TaxTMI 
TaxTMI 
2007 (1) TMI 612
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....n Act, 1996 (for short "the 1996 Act") opining that the suit filed by the appellant herein was not maintainable, is in question before us. 3. Appellant and the predecessor-in-interest of the respondents entered into a Memorandum of Understanding on 8.05.2002 in relation to their businesses of export. The same Memorandum of Understanding contained an arbitration clause in the following terms: In case of any dispute between the two parties, the same shall be referred to Arbitration, by two Arbitrators, nominated by each of the parties. The Award of the Arbitrators shall be binding on both the parties. Disputes and differences arose between the parties. However, the person who was managing the affairs of the respondents firms pa....
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....rrent situation. They asked for waiver of some interest, etc. which allegedly was accepted by it. The respondents issued five post dated cheques of Rs. 11,25,000/- each, which were forwarded by a letter dated 9th January, 2003 stating: We are enclosing herewith five post dated cheques Bearing Nos.: 574351 TO 574355 (5 Cheques) drawn ICICI Bank Ltd., Mount Road, Each R. 11,25,000/- (Eleven Lakhs Twenty Five Thousand only) towards settlement of your outstanding calculated on approximate basis. Once the overseas bills are realized we shall arrive at the exact amount balance. And if anything to be paid, we shall pass it on the same to you by a separate cheque with in 30 days time. The said cheques were presented to the b....
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....nd Forty Nine only) from the date of the suit till the date of realization. 7. Respondents in the said suit filed an application praying for reference of the dispute to the arbitral tribunal in terms of the arbitration clause contained in the said Memorandum of Understanding and contended that the suit filed by the appellant was not maintainable. By reason of a letter dated 23.08.2004, the said application was dismissed opining that no dispute existed between the parties for reference to an arbitration. On a revision application filed by the respondents herein, the High Court, however, reversed the said order by the impugned judgment. 8. Mr. Annam D.N. Rao, learned Counsel appearing on behalf of the appellant, would submit that kee....
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....on 21 of the 1940 Act, the dispute could be referred to arbitration provided parties thereto agreed. Under the 1940 Act, the suit was not barred. The Court would not automatically refer the dispute to an arbitral tribunal. In the event, it having arrived at satisfaction that there is no sufficient reason that the dispute should not be referred and no step in relation thereto was taken by the applicant, it could stay the suit. Section 8 of the 1996 Act contemplates some departure from Section 34 of the 1940 Act. Whereas Section 34 of the 1940 Act contemplated stay of the suit; Section 8 of the 1996 Act mandates a reference. Exercise of discretion by the judicial authority, which was the hallmark of Section 34 of the 1940 Act, has be....
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....11. In P. Ramanatha Aiyar's Advanced Law Lexicon, 3rd edition, page 1431, it is stated: In the context of an arbitration the words "disputes" and "differences" should be given their ordinary meanings. Because one man could be said to be indisputably right and the other indisputably wrong, that did not necessarily mean that there had never been any dispute between them.... 12. Admittedly, the appellant's claim is not confined to the question regarding non-payment of the amount under the two dishonoured cheques. Thus, there existed a dispute between the parties. Had the dispute between the parties been confined thereto only, the same had come to an end. Appellant evidently has taken before us an inconsistent stand. If he w....