TaxTMI 
TaxTMI 
1997 (8) TMI 527
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.... and subject to the terms and conditions contained in five several hire-purchase agreements in writing all dated 14th June, 1995 ("the said agreements" for short). The said agreements were each executed by the said defendant but not by the second defendant. Each of the said agreements is identical in terms and contains an arbitration clause to which I shall refer presently. Copies of the said agreements which are annexures to the plaint are also annexures to the present application. 3. In terms of the said agreements the first defendant executed demand promissory notes in favour of the plaintiff and the second defendant executed letters of guarantee. Simultaneously, with the execution of the aforesaid documents the first defendant also made over to the plaintiff fifty five several post-dated cheques for ₹ 11,45,883/- each covering the amounts of the agreed quarterly instalments payable under each of the said agreements. The said defendant also made over to the plaintiff eleven several postdated cheques in payment of the additional hire-charges in consequence of increase in the rate of interest aggregating ₹ 96,565/- for each quarter from 1st October, 1995 and....
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....at this stage to set out the Arbitration Clause contained in each of the said agreements which is identical in terms ("the said arbitration agreement" for short):-- "If any difference, dispute or question shall arise between the parties as to the interpretation, meaning or effect of this Agreement or as to the rights of liabilities of the parties arising hereunder or as to any other matter or things relating to this Agreement or arising out of or in connection herewith either during the continuance of this Agreement or after any termination or purported termination hereof, the same shall be referred to sole arbitration of any person appointed by Messrs. Mukherjee and Biswas, 10, Old Post Office Street, Calcutta-700001 for arbitration and the decision of the arbitrator whether on questions of law or of fact, shall be final and binding on the parties. The venue of arbitration shall be Calcutta. Time for making a reference to arbitration is within six months of the arising of a dispute regarding any matter arising out of this contract. Provided, however, that if the Company apprehends that the Hirer may alienate or charge or dispose of the Hired Article or may cause t....
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....on is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration." "(2) xxxxxxx " "(3) Notwithstanding that an application has been made under Sub-section (1) and that the issues is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made." 11. The "party" referred to in Section 8(1) to my mind is a party who is entitled to maintain the application thereunder. The party to the arbitration agreement who has himself instituted a suit is clearly not the "party" envisaged. The first defendant although a party to the said arbitration, agreement has elected to institute the aforesaid suits in enforcement of its rights and as such it cannot be said to be a "party" within the meaning of that Sub-section. It was submitted by the learned Counsel on behalf of the said defendant that the said defendant was not aware of its right to enforce the said arbitration agreement when it instituted the aforesaid suits in this Court and in....
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.... will be almost entirely destroyed, and the very object with which it was enacted will be frustrated. The purpose of such a statute surely was that on any point specifically dealt with by it, the law should be ascertained by interpreting the language used instead of, as before, by roaming over a vast number of authorities in order to discover what the law was, extracting it by a minute critical examination of the prior decisions." The aforesaid observations of Lord Herschell apply with equal force to the said Act, which is a consolidating and amending Act. 15. There is another reason why the present application should fail. 16. The said arbitration agreement expressly provides that recourse thereto can only be had if reference is made "within six months of the arising of a dispute". This suit was instituted for recovery of amounts due and payable by the defendants on account of the 4th, 6th and 7th instalments under the said agreements for which post-dated cheques had been issued by the first defendant and which have all been dishonoured by non-payment. Such dishonour took place long prior to 29th April, 1997 when the present application was made. If any dispute w....
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.... consider the cases cited by the learned Counsel for the first defendant in this regard. In this context it may be of interest to refer to the observations of the learned Master of Rolls Sir George Jessel in the case of "Russell v. Russell": Law Reports (1880) 14 Ch D 471 at pp. 476-7 :-- "I now come to the first ground, where personal fraud is in issue. Though I quite agree it is within the discretion of the Court to say, where one of the two partners desires it, that a dispute shall not be aforesaid to arbitration, yet I must consider for a moment which of the two partners does desire to exclude arbitration. Does the party charging the fraud desire it, or the party charged with the fraud desire it? Where the party charged with the fraud desires it, I can perfectly understand the Court saying, "I will not refer your character against your will to a private arbitrator". It seems to me in that case it is almost a matter of course to refuse the reference, but I by no means think the same consideration follows when the publicity is desired by the person charging the fraud. His character is not at stake, and the other side may say, "The very object that ....