B. S. KAPADIA, J. ( 1 ) PRESENT appeal is directed against the order dated 2 passed by the learned 3rd Jt Civil Judge (SD) Surat dismissing the application for staying the proceedings made under Sec 34 of the Arbitration Act by the original defendants Nos. 1 and 2 at Exhs. 9 and 14 respectively in Special Civil Suit No. 355 of 1985 ( 2 ) SHORT facts of the case leading to this appeal can be stated as under: ( 3 ) THE respondent No. 1 (Org. plaintiff) has filed a suit for recovery of Rs 16 31 286 from the appellant (original defendant No. 1) and also for certain other beliefs. The plaintiff is a registered partnership firm engaged in the business as contractors for transportation of goods by road from one place to another. The defendant No. 1 appellant is a Trading Corporation and is the canalising agency of the Govt. of India for handling export and import of sugar on no-profit no-loss basis. The defendant No. 2 is the handling agent of the defendant No. 1. The plaintiff alleged that the defendant No. 2 was a formal and necessary party and no relief is prayed for against the defendant No. 2. The defendant No. 1 invited tenders for transportation of sugar from various factories in Gujarat for despatch and delivery st Kandla Port. By the letter dated 6-1-1984 the offer of the plaintiff was accepted and communicated the same to the plaintiff at Surat for lifting the stocks of sugar packed in gunny bags from various co-operative societies in Gujarat for delivery of their stevodoring/shipping clearing and forwarding agents M/s. R. Tulsidas and Company (Gujarat) at Kandla Port for export. The plaintiff also furnished a bank guarantee dated 9-7-1983 to the defentant No. 1 for a sum of Rs. 2 50 The plaintiff further alleged that in pursuance of the said transport contract plaintiff completed the assignment in three month sending with the lifting of the last load on 19-5-1984 and the plaintiff submitted freight bills from time to time and a sum of Rs. 16 31 286 was due and payable by the defendant No. 1 to the plaintiff as per the particulars given in the plaint. ( 4 ) IT is also enter alia mentioned in the plaint that three notices which are subsequently produced at Exs. 16 31 286 was due and payable by the defendant No. 1 to the plaintiff as per the particulars given in the plaint. ( 4 ) IT is also enter alia mentioned in the plaint that three notices which are subsequently produced at Exs. 3/9 3 and 10/4 were issued by the plaintiff to the defendant No. 1 for recovery of the said amount. The said notices were dated 28-4-1984 12 and 14-2-1985. However. they did not give any reply to the said notices. In the said notices it was specifically mentioned about the arbitration clause and para 16 of the plaint refers to the arbitration. Though a period of one year and three months have passed from the date of giving first notice. the defendants have not cared to give any reply to the said notice issued by the plaintiff. The clause regarding arbitration reads as under:19 All disputes ar differences whatsoever arising between the parties not of ar relating to construction meaning operation or effect of this (contract) or the breach thereof shall be settled by arbitration at New Delhi In accordance with the rules of arbitration of the Indian Council of Arbitration and the award made in pursuance thereof shall be binding on the parties. Inspite of the aforesaid clause and specific reference being made in the notice no reply whatsoever was given by the defendant No. 1 for even referring the matter to arbitration before filing of the suit nor any step was taken for arbitration even after filing of the suit. However the defendant No. 1 appears to have filed an application (Ex. 8) wherein it is mentioned as under: as the copies (of documents) are to he obtained written statement could not be prepared. Hence adjournment may he granted. The said application was given on 1-3-1986 and thereafter application (Ex. 9)was filed on 17-4-1986 for staying the proceedings under Sec. 34 of the Arbitration Act. Similar application appears to have been filed by the defendant No. 2. Bath the said applications have been dismissed by the aforesaid common order. Hence adjournment may he granted. The said application was given on 1-3-1986 and thereafter application (Ex. 9)was filed on 17-4-1986 for staying the proceedings under Sec. 34 of the Arbitration Act. Similar application appears to have been filed by the defendant No. 2. Bath the said applications have been dismissed by the aforesaid common order. The application of the diffident No. 1 is dismissed on two grounds that by filing the said application for adjournment for the purpose of filing written statement the defendant No. 1 has taken the step in the proceedings meaning thereby the defendant No. 1 had abandoned its right to refer the matter to arbitration and acquiesced in the proceedings and (ii) that the defendant No. 1 was not at the time when the proceedings were commenced not ready and willing to do the things necessary for proper conduct of the arbitration. Hence the present apostle in filed ( 5 ) MR. P. M. Raval learned Advocate appearing for the appellant (defendant No. 1) has submitted that all the applications for adjournment need not be treated attempts taken in the proceeding and each application for adjournment is to be considered on the facts of each case to know as to whether by such application the defendant has unambiguously waived his right to refer the matter an arbitration and acquiesced in the court proceeding so for an the general submission of Mr. Reval is concerned them cannot be any dispute an that point and it in also held in case of Ra happa Gurudappa v. Gurusiddappa Nuraniappa Ors. . AIR 1989 SC 635 wherein in para 10 it is held that each Court must find out from the context of each case whether this has happened or not A step taken in the suit which would disentitle the regard from obtaining stay of proceedings must be such step as would dismiss an unequivocal intention to proceed within the suit and to abandon the benefit of the arbitration agreement or the right to get the dispute received be arbitration. ( 6 ) MR. P. M Raval next submitted that this application was given with a view to get the copies of the documents and therefore it cannot to said that it was an application which can be treated as an application by which the defendant No. 1 disclosed its unequivocal intention to proceed with the suit. ( 6 ) MR. P. M Raval next submitted that this application was given with a view to get the copies of the documents and therefore it cannot to said that it was an application which can be treated as an application by which the defendant No. 1 disclosed its unequivocal intention to proceed with the suit. It may be mentioned that if the appellation of the defendant No. 1 was so get copies of the documents for the purpose of making an application under Sec. 34 of the Arbitration Act or even for preparing the raced to any application of the plaintiff for interim relief? certainly no such inference can be drawn and in the present case the application in question is an application prepared by the Advocate of the defendant No. 1 and the has not even stated therein that he has not received the copy of the plaint. The plaint clearly discloses about the arbitration agreement as also about the clause for referring the matter to arbitration. Even so he has not made an appeal cation for the purpose of preparing an application for saying the proceedings but his made intention was to not adjournment for filing written statement which could not be filed because he did not have the copies of the documents Therefore this application discloses unequivocally the defendant No. 1s intention to proceed with the suit and abounded the benefit of arbitration agree- ment or the right to get the dispute resolved by the arbitration Therefore the submission of Mr. Raval that this application does not display unequivocally the intention of the defendant No. 1 to submit to the jurisdiction of the Court and to abandon the benefit of the arbitration agreement cannot be accepted ( 7 ) IT may be mentioned that Mr. Raval has argued at length the point as to whether any application given for the purpose of adjoun- ment can be treated as a Step taken in the proceedings which would disentitle the defendant to act the benefit of the arbitration agreement For that purpose Mr. Raval has placed reliance on the judgment of the Supreme Court in the case of Food Corporation of India and Anr. v. Yadav Engineer and Contractor. Raval has placed reliance on the judgment of the Supreme Court in the case of Food Corporation of India and Anr. v. Yadav Engineer and Contractor. AIR 1983 SC 1302 In the said case the learned Advocate on behalf of the second defendant prayed for time for reply and argument to the plaintiffs application for tempor- ary injunction The trial Court did not treat that application as a step in the proceedings but the High Court treated it as such and the matter went to the Supreme Court and the Supreme Court held that the learned Judge of the High Court was clearly in error in interfering with the order made by the trial Court and confirmed in appeal In the said judgment the Supreme Court while considering the expression taking any other step in the proceeding held that it must be given a narrow meaning and that step must be taken to the main proceed. ings of the suit and it must be such step as would clearly and unambiguously manifest the intention to waive the benefits of the arbitration agreement and to acquiesce in the proceedings In the present case as stated above the application is given in the main proceedings and not in the proceedings for interim relief and it discloses clearly and unambiguously the intention to waive the benefit of arbitration agreement and to acquiesce in the proceedings. ( 8 ) IT may be mentioned that in the said case there is also reference of the judgment in the case of State of U. P. v. Janki Saran Kailash Chandra. AIR 1973 SC 2701 . In the said case also similar application was given by the District Government Counsel praying for one months time for the purpose of filing written statement. hereafter an application under Sec. 34 of the Arbitration Act for stating the proceedings in the suit was filed The trial Court granted the motion for stay of suit. On appeal the High Court held that the action of the District Govt. Counsel in applying for time to file the written statement amounted to taking a step in the proceedings within the meaning of Sec. 34 of the Arbitration Act and sets aside the order of the trial Court and rejected the request for stay of proceedings. On appeal the High Court held that the action of the District Govt. Counsel in applying for time to file the written statement amounted to taking a step in the proceedings within the meaning of Sec. 34 of the Arbitration Act and sets aside the order of the trial Court and rejected the request for stay of proceedings. The Supreme Court while rejecting the appeal observed that taking other steps in the suit proceedings cannotes the idea of doing some thing in aid of the progress of the suit or submitting to the jurisdiction of the Court for the purpose of adjudication of the merits of the controversy in the suit Considering the said observation Justice D. A. Desai delivering the judgment in the case of F. C. I. (supra) has observed that the view herein taken not only does not run counter to the view we have taken but in fact clearly supports the view because the pertinent observation is that taking step in the proceedings which would disentitle a party to obtain a stay of the suit must be doing something in aid of the progress of the suit or submitting to the jurisdiction of the Court for the purpose of adjudication of the merits of the controversy in the suit. In other words the step must necessarily manifest the intention of the party to abandon or waive its right to go to arbitration or acquiesce in the dispute being decided by Court. So it is clear from the aforesaid observation that the view taken by Justice D. A. Desai in the case of F. C. J. (supra) is not different from the one which was taken in the case of Janki Saran (supra) by the Supreme Court. In para 8 of the judgment in the case of Janki Saran ( AIR 1973 SC 2071 ) Justice Dua also has given reasons for treating an application for adjournment for the purpose of filing written statement as a step taken in the proceedings. It is inter alia observed in the said judgment that if he wanted time for further consultations he could and should have specifically made a prayer to that effect. The argument that he had voluntarily without authority to appear asked for time for filing written statement was also rejected. It is inter alia observed in the said judgment that if he wanted time for further consultations he could and should have specifically made a prayer to that effect. The argument that he had voluntarily without authority to appear asked for time for filing written statement was also rejected. It was also pointed out that the State as already observed took the benefit of the adjournment and it will be somewhat irrational and perhaps incogruous to permit the State after having taken the benefit of this adjournment to plead that the application for adjournment was not made on instructions and was unauthorised. To accede to the State Government the right to do so would clearly be Unjust to the opposite party which could have rightfully objected to the adjournment had there been any indication that the prayer was not being made on instructions from the State Government. Further in para 9 of the said judgment the argument that the trial Courts discretion has been erroneously reversed by the High Court was also rejected as devoid of any merit while observing as under:if the appellants application was for adjournment for the Purpose of filing written statement then there is no question of any exercise of discretion by the trial Court. Discretion with regard to stay under Sec. 34 of the Arbitration Act is to be exercised only when an application under that section is otherwise competent. . . ( 9 ) IN the present case the question of interfering with the desecration of the trial Court does not arise as the trial Court has rejected the application of the defendant No. 1 for stay of the suit under Sec. 34 of the Arbitration Act. The judgment reported in (State of U. P. v. Janki Saran Kailash Chandra) AIR 1973 SC 2071 has also been considered in the latest judgment of the Supreme Court in the case of Rachappa Gurudappa (supra ). After referring to the judgment reported in (State of U. P. v. Janki Saran Kailash Chandra) AIR 1973 SC 2071 in pars 12 it is observed that it appears that the Counsel appearing for the petitioner had sought adjournment specifically for filing written statement and obtained time for more than one occasion for for such purpose. After referring to the judgment reported in (State of U. P. v. Janki Saran Kailash Chandra) AIR 1973 SC 2071 in pars 12 it is observed that it appears that the Counsel appearing for the petitioner had sought adjournment specifically for filing written statement and obtained time for more than one occasion for for such purpose. It was not only the time taken to consider whether written statement should be filed as a defence to the plaint to enter into an are of controversy. but it was time taken to have the matter decided by the suit. In that case also the Supreme Court dismissed the appeal of the defendant whose application under Sec. 34 was dismissed by the trial Court as well as the Division Bench of the High Court. In the present case as stated earlier even applying the test laid down by the Supreme Court application at Ex. 8 clearly discloses that the defendant No. 1 has already disclosed its intention to abandon its right to go for arbitration under the agreement and acquiesced in the suit proceedings. ( 10 ) MR. Raval has further contended that the trial Court has also wrongly dismissed the application on the ground that the defendant No. 1 was not ready and willing to do the things necessary for the proper conduct of the arbitration and therefore also the application for stay of the suit cannot be granted. The fact remains that before filing of the suit three different notices were issued by the plaintiff to the defendant No. 1 and the said notices are produced at Ex. 3/9 3 10 In para 16 of the plaint it was clearly mentioned that even after the issuance of the notices the suit was filed on 1-11-1985 i. e. after about 9 months from the date of the last notice. Even so. the defendant No. 1 has not done anything necessary for the conduct of the arbitration proceedings. The said action on the part of the defendant No. 1 disclosed that it was not ready and willing to proceed with the arbitration. Mr. Raval has disputed that finding on the ground that mere silence would not amount to unreadiness and he in this connection relied on the judgment of the Supreme Court reported in AIR 1978 SC 1608 (State of Punjab v. M/s. Geeta Iron and Brass Works Ltd. ). Mr. Raval has disputed that finding on the ground that mere silence would not amount to unreadiness and he in this connection relied on the judgment of the Supreme Court reported in AIR 1978 SC 1608 (State of Punjab v. M/s. Geeta Iron and Brass Works Ltd. ). It may bee mentioned that in the said case the State of Punjab had gone to Supreme Court in Special Leave Petition which was dismissed. In the said case the Supreme Court has observed as under:shri Hardev Singh is right to the limited extent that where parties have by contract agreed to refer their disputes to arbitration the Court should as fat as possible proceed to give an opportunity for resolution of dispute by arbitration rather than by judicial adjudication. Even so there is a residual discretion vested In the Court to stay or not to stay having regard to the totality of circumstances. One weighty factor obviously is to find out whether the party who Invokes the arbitration clause has expressed his readiness to rely on it at the earliest stage. Though there is an observation made by the Supreme Court to the effect that as a matter of law mere silence on the part of the defendant when a notice under Sec. 80 C. P. C. is sent to him may not without mere disentitle him to move under Sec. 34 and seek stay still however in the said case considering the further conduct on the part of the State Govt. it was observed as under: an opportunity for settling the dispute through arbitration was thrown away by sheer inaction. A litigative policy for the State involves settlement of Gove rnmental disputes with citizens in a sense of conciliation rather than in a fighting mood Indeed it should be a defective on the part of the State to empower its law officer to take steps to compose disputes rather than continue them to Court. . . ( 11 ) IN the present case as stated earlier apart from not giving any reply to any of the aforesaid notices the inaction on the part of the defendant No. 1 clearly disclosed that it was not ready and willing to refer the matter to arbitration. . . ( 11 ) IN the present case as stated earlier apart from not giving any reply to any of the aforesaid notices the inaction on the part of the defendant No. 1 clearly disclosed that it was not ready and willing to refer the matter to arbitration. If at all the defendant No. 1 intended to do so it would have either given reply to that effect or would have proceeded with same action necessary for the proper conduct of the arbitration. In this case either of them is missing Therefore the trial Court has rightly come to the conclusion that the defendant No. 1 was not ready and willing to refer the matter to arbitration and therefore application under Sec. 34 of the Arbitration Act is not maintainable. ( 12 ) IN this case though the application made by the defendant No. 2 (Ex. 4) was dismissed no appeal against the same is preferred However appeal is filed by the defendant No. 1 only against the dismissal of its application. It may also be made clear that the defendant No 2 is joined merely as a proper party with a view to facilitating the adjudication of all the disputes involved in the suit It is specifically made clear that no relief is claimed against the defendant No. 2 and when there is no assertion made against the defendant No. 2 there is no question of denial thereof and hence there is no dispute and hence there is also no question of referring any dispute on behalf of the defendant No 2 to arbitration In that view of the matter application filed by the defendant No. 2 is also rightly dismissed by the trial Court Therefore there is no merit in the cross objection. ( 13 ) IN view of what is stated above I do not find any substance in any of the contentions raised by Mr. P. M. Raval and therefore there is no reason to interfere with the order passed by the learned trial Judge who refused to stay the proceedings under Sec. 34 of the Arbitration Act. In result the appeal fails and stands dismissed with no order as to costs. ( 14 ) AFTER the aforesaid judgment was dictated Mr. P. M. Raval for the appellant ant Mr. In result the appeal fails and stands dismissed with no order as to costs. ( 14 ) AFTER the aforesaid judgment was dictated Mr. P. M. Raval for the appellant ant Mr. P. S. Champaneri for the respondent No. 2 jointly made a request that operation of this judgment may be stayed for a period of fix weeks so as to enable them to approach the Supreme Court Mr. Sanjanwala for the respondent No. 1 states that reasonable time may be granted. Accordingly operation of this judgment is stayed for a period to five weeks from today. It is clarified that as the matter is very old the appellant who desires to move the Supreme Court may move the matter at the earliest 80 that no further extension of time would be necessary. It is further clarified that no further extention of time will be granted. (KMV) appeal dismissed. .