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Factual and Procedural Background

The plaintiff instituted a suit on 13-5-63 for Rs. 34,333.69 as arrears of contract money due from the State of Jammu and Kashmir. The matter first came before the Court on 31-5-63, when the Advocate General appeared for the State and requested one and a half months to file a written statement. The Advocate General did not file the written statement within the time granted and on 6-8-63 sought further time; the hearing was adjourned to 29-8-63. On 8-8-63 the Advocate General, on behalf of the State, filed an application under Section 34 of the Arbitration Act seeking a stay of the suit and filed a Power of Attorney executed the same date. The plaintiff filed objections on 4-9-63 and the Advocate General filed a rejoinder on 12-9-63. Both parties examined witnesses (the plaintiff himself and Mr. H.K. Gandotra, Chief Engineer Roads and Buildings, Jammu). Arguments were heard on 27-12-63, and judgment was reserved.

Legal Issues Presented

  1. Whether clause No. 21 of the contract is an arbitration clause that binds the parties and requires referral of the dispute to the Chief Engineer as arbitrator.
  2. Whether the defendant (State), by seeking adjournments and otherwise participating in the proceedings, lost the right to seek a stay under Section 34 of the Arbitration Act (i.e., whether the defendant has taken a "step in the proceedings" so as to disentitle it from invoking Section 34).
  3. Whether the plaintiff actually approached the Chief Engineer P.W.D. for arbitration (factual question relevant to whether arbitration was pursued).

Arguments of the Parties

Advocate General / Defendant's Arguments

  • The suit cannot proceed before the civil Court because of an arbitration clause in the agreement; disputes are bound to be decided by an arbitrator (the Chief Engineer).
  • The defendant was, at the time the suit was instituted and thereafter, ready and willing to do all things necessary for proper conduct of arbitration.
  • There is no sufficient reason why the matter should not be referred to arbitration in accordance with the arbitration agreement.
  • The Advocate General contended he obtained his Power of Attorney on 8-8-63 and therefore should be deemed legally conversant with the case as of that date (argument relevant to whether prior adjournments constituted a "step").

Plaintiff's Arguments (as presented by Mr. Bhan)

  • There is, in the first place, no arbitration clause in the agreement (i.e., clause No. 21 is not an arbitration clause).
  • Even if there were such a clause, the defendant lost the right to rely on it because the Advocate General took two adjournments for filing the written statement and took other procedural steps before making the Section 34 application.
  • The plaintiff referred to several authorities in support of the proposition that taking procedural steps (such as asking for adjournments) amounts to taking a step in the proceedings and precludes invoking Section 34.

Table of Precedents Cited

Precedent Rule or Principle Cited For (as stated in the opinion) Application by the Court (how the opinion used or treated the authority)
Roop Kishore v. United Provinces Government, Lucknow, AIR 1945 All 24 Cited by the plaintiff in support of his contention (listed among authorities relied upon by the plaintiff). Referred to as an authority relied upon by the plaintiff; the Court considered authorities on this topic when addressing whether procedural steps preclude Section 34 relief.
Bansidhar Narayanji v. E.B. Sukhia, AIR 1957 (Madhya Pradesh) 24 Cited by the plaintiff (part of plaintiff's list of authorities). Not specifically discussed in detail in the reasoning; included among authorities presented by the plaintiff.
Edward Radbone v. Juggilal Kamalapat, AIR 1943 Bom 228 Cited by the plaintiff (listed among plaintiff's authorities). Referred to as cited by the plaintiff; the Court's detailed reasoning did not adopt a specific holding from this entry in the text.
Abdul Quddoos Dost Mohammad Momin v. Abdul Gani Abdul Rahman, AIR 1954 Nag 332 Cited by the plaintiff; (this Nagpur decision is later cited by the Court on the adjournment/step-in-proceedings point). The Court cited AIR 1954 Nag 332 for the proposition that an oral application for time to file a written statement is undoubtedly taking a step in the proceedings.
Murlimal Santram v. Banarsidas and Sons, AIR 1935 Siad 62 Cited by the plaintiff (listed among plaintiff's authorities). Listed among authorities cited by the plaintiff; not separately discussed in the Court's core analysis in the opinion text.
Dewanchand v. State of J. & K., AIR 1961 J. & K. 58 Cited by the Advocate General in support of the contention that the arbitration clause (or equivalent clauses) can oust civil court jurisdiction. The Court examined this authority but described its reasoning as cryptic and not sufficiently discussed to be followed; it did not treat the authority as dispositive.
Governor General v. Simla Banking and Industrial Co., AIR 1947 Lah 215 Cited by the Advocate General to support that absence of the words "arbitration" does not prevent a clause operating as an arbitration agreement (per the Lahore ruling). The Court acknowledged the Lahore ruling but stated that the intention to clothe a person with arbitrator powers must be clear; the Court found the Lahore decision not fully persuasive for the present clause.
Prem Nath Pran Nath v. Amba Parshad, AIR 1941 Lah 64 Cited by the Advocate General (listed among Advocate General's authorities). Referred to as among the Advocate General's authorities; the Court cited the Lahore High Court's view elsewhere when discussing when proceedings are deemed to have commenced, but this particular citation was listed by the Advocate General.
State of Bombay v. Adamjee Hajee Dawood & Co., AIR 1951 Cal 147 Principle that a civil Court's jurisdiction cannot be ousted except by express terms or necessary implication; right to sue in civil court is protected by Section 9 CPC. The Court relied on this authority to state the ordinary rule that civil matters must be instituted in civil courts and that the power of a civil court cannot be taken away except by express provision.
In re Sri Krishna Khanna and Bros., AIR 1934 Sind 29 Authority that references to arbitration are to be strictly construed because they deprive a party of resort to ordinary tribunal. The Court cited this case to support strict construction of arbitration agreements.
Cardiff Collieries Ltd. v. Meredith, (1929) 45 TLR 321 Illustration that an engineer or similar figure acting as exclusive judge by certificate does not necessarily constitute submission to arbitration. The Court cited this decision to illustrate that where an engineer's certificate is conclusive on certain matters that does not automatically make him an arbitrator.
Karnanj Industrial Bank v. Satya Niranjan, AIR 1924 Cal 789 Cited for the proposition that an application or request by a defendant to file a written statement can amount to taking a step in the proceedings under S.34. The Court cited this Calcutta High Court authority in support of the rule that seeking time to file a written statement is a step in the proceedings.
Subal Chandra v. Md. Ibrahim, AIR 1943 Cal 484 Cited as supporting the proposition that taking steps such as seeking adjournment to file a written statement amounts to a step in the proceedings. Included by the Court among Calcutta High Court authorities holding that requests to file written statements amount to steps in the proceedings.
Sadhan Kumar v. Sunil Kumar, AIR 1948 Cal 59 Cited as another Calcutta High Court authority supporting the "step in the proceedings" rule. The Court grouped this case with other Calcutta decisions as establishing the relevant principle.
United Provinces Government (Defendant) v. Shri Har Nath (Plaintiff), AIR 1945 All 24 Allahabad Division Bench authority discussing an application for adjournment and whether it is a step in the proceedings under S.34. The Court quoted and relied on the Allahabad view that prima facie an application for adjournment should be treated as a step, placing burden on defendant to show circumstances to the contrary.
Union of India v. Girish Chandra, AIR 1953 All 149 Cited among Allahabad authorities holding that an application for adjournment to file a written statement may be a step in the proceedings. Used by the Court to show that Allahabad High Court rulings follow the proposition that adjournment requests amount to steps in the proceedings.
Firm Chimanram Mothilal v. Firm Vandravandas Goverdhandas, AIR 1948 Bom 55 Cited by the Bombay High Court for the test whether an act is a "step in the proceedings" — whether the act displays an unequivocal intention to proceed with the suit and give up arbitration. The Court cited this Bombay authority to state the "true test" for whether an act is a step in the proceedings.
Nuruddin Abdul Husein (Plaintiff) v. Abu Ahmed Abdul Jalli (Defendant), AIR 1950 Bom 127 Cited by the Bombay High Court for the same "true test" (whether the act displays an unequivocal intention to proceed before the civil court). The Court relied on the Bombay High Court's articulation to explain tests to determine whether a step in proceedings has been taken.
Jadavji Narsidas Shah & Co. v. Hirachand Chatrabhuj, AIR 1954 Bom 174 Cited for Chagla C.J.'s two tests for application of Section 34: (1) there must be some application made by the party in the proceedings; and (2) that application must indicate preference for civil court over domestic forum. The Court used this authority to set out the two tests (from Chagla, C.J.) applied to determine whether Section 34 could be invoked.
State of Himachal Pradesh v. Lalchand Shahi, AIR 1953 Him Pra 75 Cited for the proposition that a person cannot be deemed to have taken a step in proceedings if he was not aware of the proceedings; a counsel's adjournment prayer made without client instructions did not amount to a step. The Court cited this authority to note the exception that where a defendant was unaware of proceedings, an adjournment prayer may not be a "step."
Mushtaq Ahmad, J. (quoted in AIR 1949 All 611) Quoted on the point that government status alone does not justify departure from the general rule concerning steps in proceedings. The Court cited this passage to reject the Advocate General's suggestion that the State's status justified different treatment.

Court's Reasoning and Analysis

The Court proceeded in two principal strands of analysis corresponding to the issues framed.

1. Whether clause No. 21 is an arbitration clause:

  • The Court set out clause No. 21: "In the event of any dispute between the contractor and the department, the decision of the Chief Engineer, P.W.D.J and K. Government shall be final and binding on both the parties."
  • The Court applied established principles: arbitration clauses are to be strictly construed; a clause depriving a party of access to civil courts must be established by express terms or necessary implication (citing State of Bombay v. Adamjee Hajee Dawood and In re Sri Krishna Khanna).
  • The Court relied on precedents (including Cardiff Collieries) to explain that the role and capacity in which a person acts matters — a certificate or decision by an engineer does not necessarily amount to an arbitrator's award.
  • Applying these principles, the Court found that, read alone, the language of clause (21) does not clearly designate the Chief Engineer as an arbitrator: the clause simply makes the Chief Engineer's decision "final and binding" but does not specify the capacity or legal character of an arbitrator being conferred.
  • The Court acknowledged authorities (Lahore and Jammu & Kashmir decisions) which held that absence of specific words like "arbitration" does not rule out an arbitration agreement, but found those rulings not fully persuasive for the present clause and described one (AIR 1961 J. & K. 58) as too cryptic to follow.
  • Crucially, the Court observed that the plaintiff himself admitted knowledge of a clause providing that disputes "shall be referred to the Chief Engineer P.W.D for arbitration whose decision shall be final" and that the plaintiff had approached the Chief Engineer. That admission established that, between the parties, the clause had been treated as an arbitration clause (consensus ad idem), so the plaintiff was bound insofar as he had acted on that understanding.

2. Whether the defendant lost its right to seek stay under Section 34 by taking steps in the proceedings:

  • The Court examined the chronology: Advocate General first appeared 31-5-63 and sought time to file the written statement; he again sought adjournment on 6-8-63; the Power of Attorney was dated 8-8-63 and the Section 34 application was filed the same day.
  • The Court noted the legal rule established by multiple High Court authorities (Calcutta, Allahabad, Bombay, Nagpur) that an application or request by a defendant to file a written statement, including oral requests for adjournment, prima facie constitutes a "step in the proceedings" under Section 34, and places on the defendant the burden of showing circumstances to the contrary.
  • The Court considered the defendant's contention that the Advocate General only became fully instructed (via Power of Attorney) on 8-8-63; the Court found this argument unpersuasive because the Advocate General had made unconditional appearances on earlier dates and had not qualified his appearances by saying he lacked instructions. The Court therefore deemed the Advocate General as having been engaged and conversant with the case from his first appearance on 31-5-63.
  • Given the absence of cogent evidence to the contrary and the earlier unconditional appearances and requests for adjournment, the Court concluded that the Advocate General's requests for adjournments (including the second request on 6-8-63) constituted steps in the proceedings that deprived the defendant of the right to invoke Section 34 thereafter.
  • On the separate factual question whether the plaintiff actually sought arbitration from the Chief Engineer, the Court found the plaintiff had not proved that he made any effective attempt to have the matter decided by arbitration; there was no mention of such approach in the plaint or notice and testimony on this point was loose. The Court decided this factual point against the plaintiff (though it treated that discussion as not strictly necessary given other findings).

Holding and Implications

Holding: The Court rejected the defendant's application under Section 34 of the Arbitration Act and directed that the suit proceed before the civil Court. The application under Section 34 was rejected and the suit was ordered to go ahead.

Direct consequences for the parties (as ordered by the Court):

  • The defendant was directed to file its written statement within three weeks from the date of the judgment.
  • The defendant's application for a stay under Section 34 of the Arbitration Act was dismissed and the civil suit was to continue.

Broader legal implications: The opinion does not purport to lay down a novel precedent; it applies established principles about strict construction of arbitration clauses and the well-developed body of authority that procedural steps (such as seeking adjournments to file written statements) are prima facie "steps in the proceedings" which can preclude invocation of Section 34. The Court remarked that certain authorities (e.g., AIR 1961 J. & K. 58) were cryptic and not followed in that aspect.

Application rejected.

    Radha Krishan Mirza v. State Of Jammu And Kashmir

    1. A suit for Rs. 34,333.69 was instituted by the plaintiff against the defendant, the State of Jammu and Kashmir, on 13-5-63 as arrears of some contract money due to him from the State. The suit came up before me on 31-5-63. On that day the learned Advocate General put in his appearance on behalf of the defendant. State of J. and K. It was directed that a copy of the plaint be furnished to the Advocate General in order to enable him to file his written statement for which he wanted one and a half month's time. When the written statement was not filed by the Advocate General on behalf of the State within the time granted, the case was again put up before me on 6-8-63. On that day the learned Advocate General again made a request, for further time to enable him to file his written statement. The case was adjourned to 29-8-62, giving him farther time to file the written statement, as no objection to further adjournment was taken by the other side. On 8-8-63 the Advocate General on behalf of the State put in an application under Section 34 of the Arbitration Act requesting this Court to stay the proceedings in the suit in terms of that section. Along with this application he filed a Power of Attorney on behalf of the State in his favour executed on the same date. The plaintiff's learned counsel filed objections to this application of the defendant on 4-9-63 and a rejoinder to the objections was filed by the Advocate General on 12-9-63. The parties wanted to lead evidence with regard to the application for stay and the objections thereto. The plaintiff examined himself as a witness and on behalf of the State Mr. H.K Gandotra, Chief Engineer Roads and Buildings, Jammu, was examined as a witness. I heard the arguments in the case on 27-12-63. After hearing arguments I reserved judgment.

    2. The learned Advocate General has stated that the suit of the plaintiff cannot proceed because of the arbitration clause in the agreement and the plaintiff is bound to get the case decided in terms of that clause by an arbitrator. The defendant was at the time when the suit was instituted and still remains ready and willing to do all things necessary to the proper conduct of the arbitration, and further there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement to the arbitration of the arbitrator. Mr. Bhan appearing for the plaintiff has stated that in the first place there is no arbitration clause in the agreement and secondly the defendant has lost that right because he took two adjournments for filing the written statement and because he had taken other steps in the proceedings before putting in his application under Section 34 of the Arbitration Act (hereinafter to be mentioned as the Act in this order). Mr. Bhan has referred to the following authorities in support of his contention:

    Roop Kishore…(Plaintiff); v. United Provinces Government, Lucknow…(Defendant).*. Lucknow, AIR 1945 All 24, Bansidhar Narayanji… v. E.B Sukhia…Non-Applicant., AIR 1957 Madh Pra 24, Edward Radbone v. Juggilal Kamalapat, AIR 1943 Bom 228, Abdul Quddoos Dost Mohammad Momin v. Abdul Gani Abdul Rahman, AIR 1954 Nag 332, Murlimal Santram v. Banarsidas and Sons, AIR 1935 Siad 62:

    3. On the other hand the learned Advocate General has referred to the following authorities:

    Dewanchand v. State of J. and K., AIR 1961 J. and K. 58, Governor General v. Simla Banking and Industrial Co., AIR 1947 Lah 215, Prem Nath Pran Nath v. Amba Parshad, AIR 1941 Lah 64.

    4. I shall first take up the point whether there is an arbitration clause in the agreement and whether the plaintiff can be bound in terms of that clause and other material on record to have been a party to an arbitration agreement. The clause referred to by the learned Advocate General is clause No. 21 of the agreement which is in the following words:

    “In the event of any dispute between the contractor and the department, the decision of the Chief Engineer, P.W.D.J and K. Government shall be final and binding on both the parties.”

    5. In this connection the learned Advocate General has referred me to AIR 1961 J. and K. 58 and AIR 1947 Lah 215 (Supra). The ordinary rule is that all civil matters shall be instituted in a civil Court of competent jurisdiction; the jurisdiction of a civil Court cannot be taken away unless it is, expressly so provided by some enactment for the time being in force. Therefore, when a party wants, to snatch away the ordinary powers of a civil Court, he has clearly to establish that the civil Court is precluded by an express provision of some enactment to hear a cause. As has been held in State of Bombay v. Adamjee Hajee Dawood and Co., AIR 1951 Cal 147:

    “Every person has a right to bring a suit which is of a civil nature and the Court has jurisdiction to try all suits of a civil nature under Section 9 of the CPC. If this right has got to be taken away that must be taken away by express terms or by recessary implication.”

    6. Similarly it has been held in In re Sri Krishna Khanna and Bros., AIR 1934 Sind 29 that a reference to arbitration will be strictly construed because it deprives a party of his right to resort to the ordinary tribunal.

    7. It has been laid down in Halsbury's Laws of England, 3rd edn. vol. 2, page 5 that

    “The Chairman of a conciliation board is not an arbitrator, and an architect or engineer is not in the position of an arbitrator where, as frequently happens, a contract simply provides that on certain questions his certificate is conclusive.”

    8. Similarly on page 6 (ibid) we find ‘where the engineer was to be the exclusive judge on all matters arising out of the contract and his certificate was to have the force of an award’ it was held that such an agreement did not constitute submission to arbitration. Cardiff Collieries Ltd. v. Meredith, (1929) 45 TLR 321.

    9. To my mind the language of cl. (21) of this agreement does not constitute an arbitration clause at all. What is the essence of an arbitration clause is that the parties must consciously submit to the jurisdiction of a person or persons in his or their capacity of arbitrator or arbitrators and not in any other capacity. It is true, as has been said in this case, that the decision of the Chief Engineer shall be final and binding on both the parties. It is not clear from the language of this clause in what capacity the Chief Engineer P.W.D had to give his decision. It may be that his decision would be binding on the parties because of his professional skill, because of some noble traits in his character, his popularity in society, his spiritual powers or his position in the department, or any other quality or attribute of his. What is of the essence in an arbitration clause is that a certain person is to be designated as an arbitrator and that designation brings to him certain powers lad responsibilities and clothes him with a legal character. In the absence of any such character being bestowed upon him, I am afraid any person's decision cannot be regarded as an arbitrator's award.

    10. It is true that no particular form of language is necessary to designate a certain person as an arbitrator, but the intention of the parties must be clear and unmistakably reduced into writing that they appoint a particular individual or individual as arbitrator or arbitrators in the case of a dispute. Without that express condition I am afraid we cannot stretch a stipulation as clause (21) in the present agreement as an arbination clause wherein the Chief Eagineer would be held to be an arbitrator within the meaning of the Arbitration Act. The two authorities referred to by the learned Advocate General are AIR 1947 Lah 215 and AIR 1961 J. and K. 58 (Supra): in the Lahore ruling all the terms of the contract were not reproduced except clause (25) which said that the decision of the Superintending Engineer shall be final and conclusive and binding on all the pa ties to the contract. Their Lordships have simply held that the absence of the words ‘arbitration’ ‘arbitrator’ and ‘arbitration agreement’ did not make an arbitration agreement any the less an agreement of that sort.

    11. So far so good. As already stated the intention of the parties should be to clothe the per Page: 78son with the powers of an arbitrator, no matter what language may be used in the agreement or the arbitration clause.

    12. AIR 1961 J. and K. 58 (Supra) has simply followed this authority without discussing the matter in detail and in the absence of any argument in support of its view, I am afraid the finding is too cryptic to be followed.

    13. With all this, I am afraid the above discussion in this case is of an academic nature and may sound as an obiter dictum, because in this case the plaintiff has himself admitted:

    “I know that there is a clause in the agreement that any dispute between me and the State shall be referred to the Chief Engineer P.W.D for arbitration whose decision shall be final, and that is why I approached him.”

    14. This clinches the matter so far as the plaintiff is concerned. The plaintiff has taken clause (21) clearly as an arbitration clause in the agreement and on his own showing he approached the Chief Engineer P.W.D for arbitration in the dispute between him and the State in this case. So whatever lacuna may be existing in cl. (21) of the agreement, there has been no misgiving in the mind of the parties that by incorporating this clause they appointed the Chief Engineer P.W.D as an arbitrator for any dispute arising out of the contract. To that extent, apart from ray interpretation of cl. (21) read by itself, the entire material on record including the statement of the plaintiff leads to the inference that the parties acted with consensus ad idem on the matter of appointing the C.E P.W.D as their sole arbitrator in the dispute.

    15. The second argument advauced by Mr. Bhan is that as the learned counsel for the defendant State took two adjournments to file his written statement, the protection given under Section 34 of the Act to get the suit stayed in the civil Court could not be enjoyed by the defendant. As already stated, the Advocate General first appeared for the defendant State on 31-5-63. On that day it was directed that a copy of the plaint be supplied to him and he sought a month and a hall's time for filing the written statement. He again appeared for the State on 6-8-63 and made another request for filing the written statement. For this purpose an adjoumment was granted to him. But from the file it is not clear on what date the Advocate General came in possession of a copy of the plaint. I called the learned Advocate General and asked him if he could make a statement on the subject, but he professed his inability to throw any light on the matter. So, in the absence of any cogent evidence on the record the bald facts are that the Advocate General represented the State on 21-5-63 and sought an adjournment for filing the written statement.

    16. The copy of the plaint was sent to the Chief Secretary along with the notice of the suit on 16-5-63. On the subsequent hearing also — on which day he must be presumed to have gone through the plaint and other relevant papers — he again made a request for adjournment of the case to enable him to file his written statement. There are numerous authorities on this point which lay down that an application or a request whether whether or oral, made by a defendant to file his written statement would amount to taking a step in the proceedings debarring the defendant from setting, up the plea of the stay of the suit under S. 34 of the Act. The Calcutta High Court has persistently followed this view. Karnanj Industrial Bank v. Satya Niranjan, AIR 1924 Cal 789, Subal Chandra v. Md. Ibrahim, AIR 1943 Cal 484 and Sadhan Kumar v. Sunil Kumar, AIR 1948 Cal 59.

    17. The High Court of Allahabad in a series, of cases reported as AIR 1945 All 24; United Provinces Government…(Defendant); v. Shri Har Nath…(Plaintiff)., AIR 1949 All 611 and Union of India v. Girish Chandra, AIR 1953 All 149 has also held that an application for adjournment enabling a defendant to file his written statement would be tantamount to taking a step in the proceedings. In AIR 1945 All 24, a Division Bench authority, Dhax, J. has said:

    “It may be possible to hold in some cases that an application for adjournment of a case to enable the defendant to file a written statement was not a step in the proceedings within the meaning of S. 34 of the Act, but prima facie such an application should be treated as a step in the proceedings within the meaning of S. 34 and the whole burden should be upon the defendant to establish the circumstances which will lead to the result that effect should not be given to the prima facie meaning of lie application.”

    18. This means that in the absence of any fact showing that the defendant did not intend to submit to the jurisdiction of the civil Court, the presumption would be that he was taking a step in the proceeding which would deprive him of pleading that the suit should be stayed and the matter referred to the arbitrator.

    19. The later authorities also lead to the same conclusion that an adjournment sought by the defendant for filing his written statement would constitute a step in the proceedings as contemplated by S. 34.

    20. The Nagpur High Court in AIR 1954 Nag 332 has held that an oral application for time to file a written statement is undoubtedly taking a step in the proceedings. An application is as good an application even if it is made orally instead of in writing.

    21. The Bombay High Court in Firm Chimanram Mothilal v. Firm Vandravandas Goverdhandas, AIR 1948 Bom 55 and Nuruddin Abdul Husein…Plaintiff; v. Abu Ahmed Abdul Jalli…Defendant.*, AIR 1950 Bom 127 has laid down that

    “the true test for determining whether an act is a step in the proceedings is not so much the question as to whether it is an application — although of course, that would be a satisfactory test in many cases — but whether the act displays an unequivocal intention to proceed with the suit and to give up the right to have the matter disposed of by arbitration.”

    22. Chagla, C.J in Jadavji Narsidas Shah and Co. v. Hirachand Chatrabhuj, AIR 1954 Bom 174 has laid down two tests for the application of S. 34. According to him the two tests which ought to be applied are, that there must be some application made by the party in the proceedings, Page: 79and that application must be of such a nature as to lead the Court to the conclusion that the party prefers to have his rights and liabilities determined by the civil Court rather than by the domestic forum upon which the parties might have agreed.

    23. The converse of this proposition may be stated like this: If a party after knowing the case against him prays for an adjournment to file, the written statement, that will be deemed to be a step in the proceedings.

    24. The High Court of Lahore in AIR 1941 Lah 64 has held:

    “Having regard to the provisions of O. 5 R. 2 of the CPC a proceeding must be taken to have commenced within the meaning of Section 19 of the Arbitration Act only when the defendant is supplied with a copy of the plaint and the fixing of ??? by the Court for filing a written statement when the defendant has been supplied with a copy of the plaint cannot, in any sense, be regarded as a step taken by the defendant in the proceedings inasmuch as time for filing the written statement is necessarily given by the Court.”

    25. In State of Himachal Pradesh v. Lalchand Shahi, AIR 1953 Him Pra 75 it has been laid flown:

    “No person can be deemed to take any step in the proceedings who is not aware of what the proceedings are. Therefore the prayer for adjoumment of a counsel who upto that moment had received no instructions from his client did not amount to the taking of a step in the proceedings under S. 34 of the Act.”

    26. Basing his argument on this authority, the learned Advocate General stated that be had actually got his Power of Attorney from the State on 8-8-63 on which day he applied for stay of the proceedings. Therefore he should be deemed to be legally conversant with the facts of the case on that day. I am afraid this argument is farfetched and cannot help the learned Advocate General for the following reasons:

    27. When the Advocate General put in his appearance on 31-5-63 it was an unconditional appearance on behalf of the State. The subsequent appearance also was unqualified. The drawing up of a regular Power of Attorney is of no consequence. If the Advocate General were not fully briefed on these two hearings, he should have given some such indication in the Court. On the other hand be in unequivocal terms stated that he had been engaged by the defendant and was appearing for the defendant without any qualification or reservation. He must have discussed the facts of the case with his principals long before he executed the Power of Attorney. He has not taken us into confidence when his principals contacted him in this case, bud the latest date of his having been engaged in the case shall be deemed to be 31-5-63 when he first appeared for the defendant in the suit. After that he took two adjournments to file the written statement. There is no reason advanced by the learned Advocate General why his two requests or at least one of them, the latter in order of time, should not be deemed to be a step in the proceedings disqualifying him from invoking the provisions of S. 34 of the Act, unless, of course, it can be argued in the words of Mushtaq Ahmad, J. in AIR 1949 All 611 that

    “No classification is suggested of the cases in which the rule would apply and those in which it would not apply. At least nothing has been urged by the learned counsel to show that the rule would not apply in the present case except that the defendant was the U.P Government. We do not consider that this circumstance can be taken as a ground for departing from the rule laid down in the ruling mentioned above”.

    28. The law makes no distinction in a case where the defendant is the State from one where the defendant is a private person.

    29. About the question of fact whether the plaintiff approached Mr. H.K Gandotra Chief Engineer for arbitration, I do not think that it is necessary to adjudicate upon this matter in view of my above findings, but none-the-less as the point was raised, I think it worth-while to say something about this controversy also. I feel the plaintiff has not been able to prove that he ever made any attempt at getting the matter decided by arbitration of the Chief Engineer P.W.D There is no such mention of his having approached anybody for arbitration in either the notice or the plaint. The oral statements on this aspect of the case are very loose on either side, but I am convinced that there has never been a real request or offer by the plaintiff to the Chief Engineer to get the matter settled by arbitration. This point is therefore decided against the plaintiff. In view of the above authorities and the findings arrived at by me I am sure that the learned Advocate General after knowing the full facts of the case long before 6-8-63 applied for extension of time for filing the written statement, which will be deemed to be a step in the proceedings, no matter that he or his principals changed their mind on the 8th August. The right which they had under S. 34 had been completely lost on the 6th of August when a second adjournment was sought for in filing the written statement. The suit cannot, therefore, be stayed and must go ahead. The defendant is directed to put in his written statement within three weeks from today and the application of the defendant under S. 34 of the Act for stay of the suit is rejected.

    BH/VRB/D.V.C

    30. Application rejected.

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    Comments

    Radha Krishan Mirza v. State Of Jammu And Kashmir
    (Jan 2, 1964)