1. These three appeals filed by the defendant arise out of one and the same order disposing of three different applications of the defendant and accordingly were heard together and are being disposed of by this common judgment.

2. plaintiff and defendant are two brothers and the dispute arose between them in respect of the joint family properties. At the intervention of well-wishers on 9-1-1985 both of them referred their disputes to a tribunal consisting of three influential persons of the locality, namely, Dr. P. Rajeswara Rao, Shri K. Kondala Rao and Sri Bellala Gurumurty. The said tribunal gave some interim direction to the parties to deposit the gold and silver ornaments and some cash which was duly obeyed by the plaintiff but not by the defendant. Ultimately the Tribunal gave their award. The defendant filed an application to set aside the said award alleging fraud against the arbitrators. This application was numbered as Title Suit No. 14 of 1984.

The plaintiff being helpless to get any relief filed a suit which was numbered as title Suit No. 19 of 1985. The prayer in the suit was that plaintiff's right, title and interest in respect of Schedule ‘A’, ‘B’ and ‘C’ properties be declared and the defendant be permanently injuncted from disturbing the plaintiff's possession in respect of the said properties. The prayer for confirmation of possession and in case plaintiff is found to have been dispossessed, for recovery of possession was also made. The plaintiff also prayed for a direction for partition of the house by constructing a partition wall as well as for partition of moveable properties plaintiff also filed two miscellaneous applications for interim reliefs — one for interim injunction which was numbered as M.J.C No. 31 of 1985 and another for appointment of receiver in respect of Schedule ‘A’ and ‘B’ properties which was numbered as M.J.C No. 32 of 1985. The defendant in the said miscellaneous cases filed applications under S. 34 of the Arbitration Act for stay of further proceedings in Title Suit No. 19 of 1985. He also filed a petition under O. 1, R. 9, Civil P.C to dismiss the suit for non-joinder of necessary parties and an application under S. 151 of the Civil P.C to discharge the receiver. The application for discharge of receiver was necessary since on the application of the plaintiff for appointment of receiver in M.J.C No. 32 of 1985, the Court had passed an order on 9-10-1985 directing the local Revenue Inspector to take charge of the lands covered under Schedule ‘A’ and ‘B’ together with the standing crops thereon and to furnish necessary accounts. By a composite order dt. 19-10-1985, the learned Subordinate Judge has rejected all the applications filed by the defendant and hence these three miscellaneous appeals have been filed by the defendant.

3. The main contention urged by Mr. B.M Patnaik appearing on behalf of the appellant is that since the dispute in question was referred to a body of arbitrators and the arbitrators have already passed an award, the suit filed by the plaintiff ignoring the said award must be stayed under S. 34 of the Arbitration Act and the learned Subordinate Judge committed a gross error of law in rejecting the application for stay. Mr. B.B Ratha, the learned counsel for the respondents, on the other hand, submits that S. 34 of the Arbitration Act has no application, since the arbitrators have already passed an award and, therefore, there will be no point in passing an order of stay under S. 34 of the Act. The learned counsel further contends that the relief sought for in the suit is not the same as the one which was before the arbitrators and, therefore, the jurisdiction of the Civil Court cannot be said to have been ousted. The contentions raised on either side require careful examination.

4. S. 34 of the Arbitration Act is quoted hereinbelow in extenso:—

“Where any party to an arbitration agreement or any person claiming under him commences any legal proceedings 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 proceedings may at any time before filing a written statement or taking any other steps in the proceedings, apply to the judicial authority before which the proceedings are pending to stay the proceedings; and if satisfied that there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement and that the applicant was, at the time when the proceedings were commenced, and still remains, ready and willing to do all things necessary to the proper conduct of the arbitration, such authority may make an order staying the proceedings.”

The aforesaid provision makes it explicitly clear that a Court has a discretion to stay or not to stay a suit having regard to the totality of circumstances and the occasion for the exercise of discretion does not arise unless all the conditions stated in the section are fulfilled. This section is actually in replacement of S. 19 of the Act 9 of 1899 and corresponds to S. 4 of the English Arbitration Act, 1889. Briefly stated, the pre-conditions which are necessary to obtain an order of stay invoking the provisions of S. 34 of the Arbitration Act are:—

(i) there must be a valid arbitration agreement in existence;

(ii) The legal proceeding must have been started after the agreement to refer—

(b) by a party to the agreement or any person claiming under him; and

(b) against any other party or any person claiming under him;

(iii) the proceeding must be with respect to the matter agreed to be referred to arbitration;

(iv) the application for stay is made by a party to the legal proceeding;

(v) the application is filed before filing the written statement or taking any step in the proceeding;

(vi) the party asking for stay must be ready and willing to do all things necessary for the proper conduct of the arbitration.

If all these conditions are satisfied and if there is no sufficient reason otherwise, the Court in which such legal proceeding is started may stay the proceeding. The applicant who applies for stay must, therefore, satisfy the Court that all the conditions specified above have been fulfilled and in that event, the onus would shift to the plaintiff to show that notwithstanding fulfilment of these conditions, there is yet sufficient reason why the matter should not be referred to arbitration. Though the making of an order staying proceedings invoking the jurisdiction under S. 34 of the Arbitration Act is a matter largely in the discretion of the Court, yet the discretion should be judicially exercised and only when the conditions laid down in the section are found to be satisfied. Thus an arbitration agreement though does not affect the jurisdiction of the Court and S. 34 of the Arbitration Act does not act as an absolute bar to the jurisdiction of the Court to hear a suit, but where the parties have entered into an agreement for the arbitration, the Court would normally decide the rights of the parties according to their agreement. The Court ordinarily requires the parties to resort for resolving disputes arising under a contract to the tribunal contemplated by them at the time of the contract, just to promote the sanctity of contract. The jurisdiction of the Court to try the suit remains unfettered, but the discretion of the Court on the grounds of equity is interposed. (See, AIR 1963 SC 1044 (Michael Golodetz v. Serajuddin and Co.). It is universally accepted principle that the parties are prima facie bound by the arbitration clause and, therefore, normally they should be asked to keep to their bargain. It is undisputed that the Court should exercise its discretion in refusing to stay a suit in a sparing and cautious manner as a prima facie duty is cast upon Courts to act upon such an agreement. See, AIR 1958 All 522 (Ram Bahadur Thakur v. Thakur Das); AIR 1921 All 219 (Firm Sita Ram Nathmal v. Sushil Chandra Das and Co.) and (1873) 42 LJ Ch 447 (Willesford v. Watson). At the same time, the Court will have to consider the hardships involved and where the balance of convenience lies. The language of S. 34 requires that on an application being made for stay of the suit, the Court should look at the plaint and see for itself whether the arbitration clause applied to the dispute and, if it did, whether the nature of the dispute was such that the ends of justice would be met by the decision of the Court than of a private forum. The language of the section implies that the arbitration clause should be respected and it is only when a clear case has been made out by the plaintiff and if difficult questions of law are likely to arise, such as would inevitably entail a special case being prepared and a reference made to a Court by the arbitration, that the Court should enter upon an enquiry and decision of the case. The object of the section is to enforce the arbitration agreement between the parties and to prevent any party to it committing a breach thereof. It operates by way of an injunction to prevent the plaintiff who, contrary to the arbitration agreement, institutes the suit. This being the position of law, I would now examine the correctness of the reasonings of the learned Subordinate Judge who has rejected the application for stay.

5. The learned Subordinate Judge has held that S. 34 of the Arbitration Act has no application since admittedly the suit was filed after the award of the arbitrators. He came to the aforesaid conclusion on an interpretation of S. 34 of the Arbitration Act and relying upon the decision reported in AIR 1982 SC 1302 (Food Corporation of India v. Yadav Engineer and Contractor). Mr. Ratha, the learned counsel appearing for the respondent 1 relies on the decision of the Lahore High Court in the case of Jawahir Singh Sundar Singh, Firm v. Fleming Shaw and Co. Ltd., AIR 1937 Lahore 851 and the decision of the Madras High Court in the case of B. Raghuveeriah v. National Small Industries Corporation Ltd., 1970 Lab IC 493. Mr. Patnaik, the learned counsel for the appellant on the other hand, though did not cite any direct authority on the point but relied upon the decision of the Supreme Court in the case of Printers (Mysore) Private, Ltd. v. Pothan Joseph , AIR 1960 SC 1156. I have carefully examined the decision of the Supreme Court relied upon by Mr. Patnaik the learned counsel for the appellant and I do not find any support in the said decision for the proposition advanced by the learned counsel for the appellant. The ratio of the aforesaid Supreme Court case is that the power to stay a legal proceeding under S. 34 of the Act is discretionary and so a party to an arbitration agreement against whom legal proceedings have been commenced cannot by relying on the arbitration agreement claim stay of legal proceedings instituted in a Court as a matter of right. However, the discretion vested in the Court must be properly and judicially exercised. Ordinarily, the Court would direct the parties to go before the tribunal of their choice and stay the legal proceedings instituted before it by one of them. It would be difficult, and it is indeed inexpedient, to lay down any inflexible rules which should govern the exercise of the said discretion. The Supreme Court of course in the said case laid down some guiding principles for grant or refusal of stay. Nowhere the Supreme Court was required to answer the question whether S. 34 would have any application after the arbitration proceeding has culminated in an award of the arbitrator. This question directly came up for consideration before their Lordships of the Lahore High Court in Jawahir Singh's case, AIR 1937 Lah 851 and the Court observed:—

“……The object of passing an order staying the suit, under that section, is to allow the parties to proceed with the arbitration. But if before the application for stay is made, or has been disposed of, the arbitrators have already made the award, there will be no point in making the stay order. In that event, the proper course for the Opposite Party would be to plead the award in bar of the suit and not to obtain an order staying the suit pending arbitration, which already terminated.”

In that case, the Lahore High Court was considering the effect of S. 19 of the Arbitration Act, 1899, which is in pari materia with S. 34 of the present Act and undoubtedly, the aforesaid observations of the Court fully support the contention of Mr. Ratha, the learned counsel appearing for respondent 1. In the Madras case, 1970 Lab IC 493, it was held:—

“Section 34 of the Arbitration Act, 1940, corresponds to S. 19 of the Arbitration Act, 1899, which itself corresponded to S. 4 of the English Arbitration Act of 1889 now replaced by S. 4(1) of the English Arbitration Act of 1950. (S. 19 of the Arbitration Act, 1899, corresponded to para 18 of the 2nd Schedule to the Civil Procedure Code of 1908). Thus, S. 34 of the Arbitration Act, 1940, providing for an order of stay of judicial proceedings, has been there in the statute book in one form or another for a considerable time. The conditions to be fulfilled for invoking S. 34 of the Act have been explained and considered in several decisions, which it is unnecessary to refer to in view of the very narrow point that falls for consideration in this application and that point being whether the Court can order stay of further proceedings in the suit, when the arbitration proceedings have already culminated in an award. In my opinion, the language of S. 34 is wholly inappropriate to such a situation. The second limb of the said section states that the Court should be satisfied ‘that there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement and that the applicant was, at the time when the proceedings were commenced, and still remains, ready and willing to do all things necessary to the proper conduct of the arbitration’. The expressions underlined by me above clearly and indisputably indicate that at the time when the Court is called upon to pass an order of stay, either the matter should not have been referred to arbitration at all and the Court must be satisfied that there is no reason why the matter should not be referred in accordance with the terms of the arbitration agreement or the arbitration proceedings are pending, the matter having already been referred to the arbitrators. If the arbitration proceedings have already come to an end and have resulted in an award, the question of the Court being satisfied that there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement and the willingness and readiness of the defendant to do all things necessary to the proper conduct of the arbitration cannot arise, since there is no matter to be referred to arbitration and there is no arbitration to be conducted. The learned counsel for the applicant-defendant faintly contended that any proceedings taken before the Court under the Arbitration Act, even after an award has been passed, will constitute arbitration proceedings and, therefore, the section can apply, as the applicant-defendant has taken proceedings in the City Civil Court, Hyderabad, under S. 14 of the Act, for filing the award into the Court. In my opinion, this contention is wholly untenable and there can be no warrant whatever for such a contention either in the language of S. 34 of the Act or in the entire scheme of the Arbitration Act, 1940. Once a litigant comes before a Court with a grievance or a claim, it is the ordinary and normal function of the Court to investigate into the matter and render a decision, and stay of proceedings before it, by the very Court is an exception to the general rule and consequently any person who wants the proceedings to be stayed must bring the case within the four corners of the language of the statutory provision which he invokes in his aid. In this case, the only salutary provision on which reliance has been placed is S. 34 of the Arbitration Act, 1940, and the language of that section does not support the case of the applicant at all.”

In my opinion, the aforesaid decision also supports the contention of Mr. Ratha, the learned counsel appearing for respondent 1.

6. Apart from the aforesaid authorities, even the plain language in S. 34 of the Act supports the contention of Mr. Ratha, the learned counsel for respondent No. 1. The second part of S. 34 contemplates that if the Court is satisfied that there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement, then the Court may make an order staying the legal proceedings. But where the arbitration proceedings itself has already come to an end and the outcome is an award, the question of Court's satisfaction as to why the matter should not be referred in accordance with the arbitration agreement, does not arise at all and, therefore, to such a situation, the second part of S. 34, which is also a precondition for passing an order of stay does not apply and as such, the Court would not be justified in invoking its power of stay under S. 34 of the Act in such a case. In this view of the matter, I do not find any illegality in the impugned order refusing to stay the suit in question.

7. So far as the question of rejecting the petition under O. 1, R. 9, Civil P.C, as well as under S. 151 of the Code is concerned, I do not find any infirmity in the impugned order itself nor any contention has been raised by the learned counsel for the appellant on that score. The main contention of the learned counsel for the appellant was application of S. 34 of the Arbitration Act. The contention having been rejected by me and no other contention having been raised by the learned counsel for the appellant, all the appeals must be rejected.

8. In the ultimate result, therefore, the miscellaneous appeals fail and are hereby dismissed, but in the circumstances, without any order as to costs.

Appeals dismissed.