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TMI Blog1968 (11) TMI 114X X X X Extracts X X X X X X X X Extracts X X X X ..... he plaint are as follows: It is stated that the plaintiff was the owner of a vessel, namely, S.S. Capella and that by a charter party dated October 28, 1963 made between the plaintiff and the defendant No. 1, the Asiatic Shipping Co. Private Ltd., the appellant before us, it was agreed, inter alia, that the said vessel then in the Bay of Bengal would proceed to the port of Calcutta and the defendant No. 1 as the charterer would load goods and cargo therein and would proceed to Djakarta and Surabaya in Indonesia and deliver the cargo, on being paid 16,000 as freight. It is further alleged that the defendant No. 2, Associated Commercial Co. of India Private Ltd. In consideration of the plaintiff entering into the charter party, guaranteed th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... involves the determination of the question as to whether the principal debtor was liable, for if the principal debtor was not liable no liability could be attributed to the guarantor. Now, the principal debtor wants to go to arbitration in London. Apart from the fact that nothing whatsoever has happened in London but everything happened in India and the Far East, the Learned Judge has expressed an apprehension that the same issue as regards the liability of the principal debtor will have to be gone into, both in the suit and in the arbitration proceedings and there was every likelihood of conflicting findings. Therefore, by using his discretion he has held that he is not inclined to exercise his discretion in this case and on the facts of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nters (Mysore) Private Ltd. v. Pothan Joseph, 1960]3SCR713 . It has been pointed out that an arbitration agreement does not affect the jurisdiction of the Court, but where parties have entered into an agreement for arbitration, normally the Court would decide the rights of the parties according to their agreement. But the Court has always, a discretion to grant the stay or not and this discretion, of course, should be exercised judicially. In our opinion, in the facts and circumstances of this case, the discretion has been exercised judicially and we agree with the reasonings given by the learned Judge in not granting the stay. I have stated above the reasoning of the learned Judge and it is not necessary to repeat it. Mr. Chaudhuri, appear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interesting point, because it does not seem that any of the decided authorities have dealt with the point, exactly as it has arisen before us. I do not think there can be any doubts as regards the proposition that if an application is made to file a written statement in the Court of first instance dealing with a stay application, that, under Section 34 itself creates a bar. For that purpose, it will be necessary to look at the provisions of Section 34 itself which I set out below: 34. Where any party to an arbitration agreement or any person claiming under him commences any legal proceeding against any other party to the agreement or any person claiming under him in respect of any matter agreed to be referred, any party to such legal p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Court below, there is no harm if the applicant files a written statement or takes any step, because such things should not be done before the commencement of the proceedings but can be done afterwards. For this purpose, a decision of a single Judge of the Simla High Court has been cited, namely, Hanuman Chamber of Commerce Ltd. v. Parameshri Lal Co. AIR 1951 Simla 173. in that case, an application was made for stay under Section 34 of the said Act. The trial Court ordered that, without prejudice to the decision of the stay application, the defendant should file a written statement, as also their documents and lists of reliance . Against this order, there was an application for review and it was contended that a written statement shoul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before the Court for liberty to file written statement and asked for and obtained directions for the further conduct of the suit. There was order for the discovery and inspection and for expedition of the suit. It must not be forgotten that under Section 34, not only there must be readiness and willingness to go to arbitration at the time when the proceedings were commenced, but such readiness and willingness must continue. Here, no stay has been obtained in the Court below and an appeal has been preferred. The entire matter, therefore, is open before us. We have the same rights as those of the Court below. If this appeal succeeds, then we shall have to make an order for stay, and we cannot ignore the wordings of Section 34 which requires ..... X X X X Extracts X X X X X X X X Extracts X X X X
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