Chandurkar, J. - (1.) THE respondent-plaintiff had filed a suit against Union of India, appellant in this appeal, for recovery of Rs. 68,033.95, which includes interest of Rs. 25, 575.95 on the amount of Rs. 42, 458/- being the price of goods sold and delivered by the plaintiff of the defendant and which according to the plaintiff, have been wrongly rejected by the defendant by their rejection order dated 3rd October, 1975.
(2.) PRIOR to the suit, a notice under S. 80 of the Civil Procedure Code was served on the Union of India on 31-7-70. Even prior to that, a letter was served by the plaintiff on the defendant on 1st December 1975, through the General Manager of Western Railway requiring them to pay the suit amount and this letter was accompanied by a copy of the plaint which the plaintiff proposed to file. The Union of India was thus given due information by the plaintiff as far back as 1st December 1975, that the plaintiff would file a suit if the amount due is not received. The suit is filed on 2-10-1978, which is almost the last day of limitation. Summons of the suit was served on Union of India on 27-10-1978. It was only on 9-12-1979 that Union of India took out a notice of motion for staying the suit under Section 34 of the Arbitration Act contending that the contract, in pursuance of which the goods were supplied by the plaintiff, was governed by an arbitration clause, No, 2900 contained in the Indian Railways Standard Conditions of Contract. this clause provides for an appointment of a sole arbitrator by the General Manager of the Zonal Railways for the purposes of referring all disputes and differences arising under the contract like the one in the instant case.
(3.) THE learned Judge took the view that the letters which were exchanged en the parties, there is no indication given by the defendant of their readiness and willingness to refer the dispute to an arbitrator. THE learned Judge took the view that no reply was given to notice under S. 80 of the Code of Civil Procedure and, in fact, the only document in which the defendant has indicated their readiness and willingness to refer the disputes and differences to arbitration was the affidavit filed by them in support of the notice of motion. THE learned Judge, therefore, took the view that the defendant had not shown their readiness and willingness to refer disputes to arbitrator at the commencement of the suit and they were. therefore, not untitled to succeed in the notice of motion. THE motion having been dismissed by the learned Judge, the Union of India has filed this appeal.;