TMI Blog2007 (1) TMI 612X X X X Extracts X X X X X X X X Extracts X X X X ..... the dispute between the parties been confined thereto only, the same had come to an end. Appellant evidently has taken before us an inconsistent stand. If he was satisfied with the payment of the said demand drafts, he need not pursue the suit. It could have said so explicitly before the High Court. It cannot, therefore, be permitted to approbate and reprobate. Section 8 of the 1996 Act is peremptory in nature. In a case where there exists an arbitration agreement, the court is under obligation to refer the parties to arbitration in terms of the arbitration agreement. Hindustan Petroleum Corpn. Ltd. v. Pinkcity Midway Petroleums [ 2003 (7) TMI 493 - SUPREME COURT] and Rashtriya Ispat Nigam Limited [ 2006 (8) TMI 515 - SUPREME COURT] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irms passed away. His daughter thereafter took over the business of the firms. By a letter dated 03.08.2003, it was stated: It is with great sorrow and regret that we write to inform you the said demise of our beloved Mr. R. Srivatsan, Managing Director of our Company on the 1 August, 2003 at 20-45 hrs after a brief illness. He suffered a massive heart attack and succumbed. However the business interests of the company will be continued to fulfil his cherished goal and vision. Our company will strive to carry forward his legacy which will serve as a beacon light in all our future endeavours. We wish to reiterate all our customers that business will be carried on a usual and all our commitments and obligations shall be made without ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terms of three cheques bearing Nos. 574351 dated 21.4.2003, 574352 dated 21.5.2003 and 574353 dated 21.6.2003 were honoured whereas the fourth cheque bearing No. 574354 dated 21.7.2003 was dishonoured on 29.07.2003. 4. Admittedly, Respondents without prejudice to their rights and contentions sent a demand draft bearing number 028881 drawn on 18.08.2003 for a sum of Rs. 11,25,000/- which was accepted by the appellant. Yet again on 12.09.2003, the respondents without prejudice to their rights sent another demand draft bearing number 029612 for a sum of Rs. 11,25,000/-. 5. Before receipt of the said payments, however, the appellant filed a suit in the District Court at Vijaywada for a decree for a sum of Rs. 36,14,887/-, the cause of act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondents herein had accepted their liabilities, it cannot be said that there existed a dispute or dispute by and between the parties within the meaning of Clause 20 of the Memorandum of Understanding dated 8.05.2002. According to the learned Counsel, as the respondents accepted their liability, pursuant whereto and in furtherance whereof, they issued post dated cheques, a suit for realization of the amount under the said cheques would not attract the provisions of the 1996 Act. Mr. Anupam Lal Das, learned Counsel appearing on behalf of the respondents, on the other hand, submitted that in view of the fact that the respondents had paid the balance amount of Rs. 22,50,000/- by way of two demand drafts dated 18.08.2003 and 12.09.200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... direction to make reference is not only mandatory, but the arbitration proceedings to be commenced or continued and conclusion thereof by an arbitral award remain unhampered by such pendency. [See O.P. Malhotra's 'The Law and Practice of Arbitration and Conciliation', 2nd Edition, pp. 346-347] 10. Respondents had not filed any written statement in the suit. They had not disclosed their defence. They indisputably had raised a dispute in regard to the claim of the appellant. We have noticed the arbitration agreement entered into by and between the parties. It is of wide amplitude. The arbitration agreement brings within its fold dispute of any nature whatsoever. It is in broadest term. Respondents had made payments without pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... demand drafts, he need not pursue the suit. It could have said so explicitly before the High Court. It cannot, therefore, be permitted to approbate and reprobate. 13. Section 8 of the 1996 Act is peremptory in nature. In a case where there exists an arbitration agreement, the court is under obligation to refer the parties to arbitration in terms of the arbitration agreement. [See Hindustan Petroleum Corporation Ltd. v. Pinkcity Midway Petroleums AIR 2003 SC 2881 and Rashtriya Ispat Nigam Limited (supra)] No issue, therefore, would remain to be decided in a suit. Existence of arbitration agreement is not disputed. The High Court, therefore, in our opinion, was right in referring the dispute between the parties to arbitration. 14. For ..... X X X X Extracts X X X X X X X X Extracts X X X X
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