M.R.Mallick, J. - (1.) THIS is an appeal against the Order dated 23rd February, 1979 passed by the Judge, 10th Bench, City Civil Court at Calcutta dismissing the appellant's application u/sec. 34 of the Arbitration Act. Briefly the facts are as follows :-
(2.) THE appellant, Hindusthan Cables Limited being interested in disposing of twenty items of scrap materials issued a tender being SPC- 762/ A-82 in various leading Newspapers between 16th March and 27th March, 74. Pursuant to the aforesaid tender notice several interested parties submitted the quotation including the respondent in the prescribed form. THE aforesaid tender documents specially under general terms and conditions of the said tender contains an arbitration clause which is as follows :- " All disputes and differences except the matters decisions whereof are specifically provided for under the clause of terms and conditions of this tender should be referred to the Arbitration of the Managing Director of the Company or his nominee whose decision shall be final and conclusive under the proceedings of India Arbitration Act, 1940 and the rules thereunder and the statutory modifications thereof if any, shall be deemed to apply. If, however, no award can be made by the Arbitration within a period of 4 months from the date of entering on the reference by him, the arbitrator can enlarge time for making the award with the consent of all the parties to the arbitration proceedings". On or about April 15, 1974 the appellant accepted the offer of the respondent for Items Nos. 1, 3, 4 and 14 respectively and requested the respondent to arrange for immediate remittance of the full value. In view the terms of the contract, contract by and between the appellant and the respondent was concluded on the 15th April, 1974. The petitioner, thereafter, by a letter dated April 19, 1974 issued a formal letter of acceptance way of and/or in compliance with the formalities prevalent in the appellant company. The aforesaid letter of acceptance was a mere formality as, feed, would be evident, inter alia, from the course of conduct and/or dealings by and between the parties herein. However, in spite of repeated requests made in letters dated 29.4.74 and 7.5.74 respectively, the respondent failed and neglected to deposit the full value of stores within the stipulated period or within the extended time as granted by the petitioner. The time to deposit the full value of the materials was extended and last of such tension was made on May 7, 1974. Ultimately, by an Express Telegram dated May 17, 1974 the appellant informed the respondent as they had failed and neglected to deposit the full value of the items in breach of the contractual terms and/or in violation thereof the earnest money lying the credit of the contract was forfeited and have been taking steps for re-sale of the items at the respondent's risk and costs. Thereafter, materials covered on the aforesaid item Nos. 1, 2 and 3 were sold to one M/s. Mohon Metal Stores of 157, Netaji Subhas Road, Calcutta-1 and Item no.14 was sold to M/s. Hindusthan Drum and Supply Co. of No. 71, Princep Street, Calcutta-13 as a result whereof the appellant has suffered loss and damages to the tune of Rs. 2,02,415/-. The appellant thereafter by a letter dated 8th March, 1976 duly informed the respondent about the said loss sustained by them and demanded payment of the aforesaid sum from the respondent. Inasmuch as the respondent wrongfully failed and neglected to pay the above sum of Rs. 2,02,415/- or portion thereof, the appellant by a letter dated March 21, 1977 invoked Arbitration in terms of the aforesaid contract and duly referred the dispute to the Arbitration of the Managing Director of the appellant. The Managing Director by a letter dated March 24, 1977 nominated and/or appointed in terms of the aforesaid Arbitration clause one Mr. R. Sen and requested him to adjudicate upon the dispute. Mr. Sen, the Ld. Arbitrator directed the appellant to file the statement of claim by May 26, 1977 and the respondent to file their counter-statement of claim within a period of fortnight from the date of receipt of the said statement of claim. On or about May 23, 1977 the appellant duly filed its statement of claim before the Ld. Arbitrator. On or about June 8, 1977 the respondent requested the appellant to furnish certain particulars and to give inspection thereon as the same were absolutely necessary for them to file their counter-statement. Thereupon on June 30, 1977 the appellant acceded to the request for giving particulars and inspection of the documents sought for by the respondent and accordingly on or about July 13, 1977 the Ld. Sole Arbitrator gave direction for inspection of the documents and further extended time to file their counter-statement of facts by July 19, 1977. By a telegram dated 15.7.77 the respondent unequivocally sought for inspection of the documents on July 16, 1977 and accordingly the representatives of the respondent inspected the said documents on July 16, 1977. In the premises aforesaid, the respondent unequivocally and/or unconditionally submitted to the jurisdiction of the Ld. Arbitrator and, as such, they would be stopped and/or precluded from denying the jurisdiction of the said Ld. Arbitrator. However, on or about July 22, 1977 the appellant received a letter from the Ld. Arbitrator wherein he informed the appellant that the respondent had filed a suit and further alleged that the subject matter of the Arbitration proceeding is covered by a suit filed before the City Civil Court at Calcutta being T.S. no. 1021/77. Therefore, it is now gathered that on or about 20th July, 1977 the respondent in violation of the terms and conditions of the aforesaid contract particularly of the aforesaid Arbitration clause instituted before the City Civil Court at Calcutta a suit against the appellant claiming, inter alia, a declaration that no valid and/or binding agreement between the appellant and the respondent was entered into pursuant to the appellant's invitation to tender and praying for a decree directing the appellant to deliver up the respondent's tender document so that the same might be cancelled and for further certain incidental reliefs. 3a. The appellant has, thereafter, filed this application u/S. 34 of the Arbitration Act praying for stay of the suit no. 1021/77 u/S. 34 of the Arbitration Act contending, inter alia, that the aforesaid suit was filed when the Arbitration proceeding was pending before the Ld. Sole Arbitrator and after the respondent unequivocally submitted to the jurisdiction of the Ld. Arbitrator and sought for inspection of the document on July 5, 1977, that the said suit was instituted in order to wriggle out from the aforesaid Arbitration clause and indeed in violation thereof the said suit was instituted, at all material times the dispute raised in the suit by and between the parties are well within the ambit of the Arbitration clause, that the respondent deliberately made false allegations that there was no valid and binding agreement between the parties with a view to rendering the Arbitration clause including the proceeding nugatory and that the appellant was at all material times ready and is still ready and willing to refer the aforesaid dispute to the Arbitration and in fact, the appellant had already preferred claim before the Ld. Arbitrator in pursuance of the aforesaid Arbitration clause and there is, therefore, no reason as to why the suit being T. S. 1021/77 should not be permanently stayed.
(3.) THE present respondent contested the said application contending, alia, that there was no concluded agreement between the parties that terms of the contract was vague and unenforceable and that the appellant letter dated April 19, 1974 was by way of a counter-offer which the respondent did not accept and consequently there was no concluded contract and the present suit which was for a declaration that there was no concluded contract between the parties cannot be stayed u/S. 34 of the Arbitration Act.;