Judgment :- V. V. KAMAT, J. By the impugned order dated March 30, 1994 the learned second Additional Sub Judge, Ernakulam on I.A. No. 1548/94, filed by the defendants under Section 34 of the Arbitration Act 1940, while staying the proceedings of the suit No. 198/94, has not disturbed or found it necessary to stay ad interim order and injunction granted earlier in I.A. No. 1375/94 2. These two appeals are filed by both the parties to the suit, appeal No. 377/94 being by the defendants and appeal No. 816/94 by the plaintiff, as both appear to be not satisfied with the order which on various considerations needs no disturbance at our hands 3. The civil court has power and jurisdiction to try all suits of a civil nature, unless jurisdiction is expressly or impliedly barred. At the same time by an order of stay and the impugned order is of stay what is stayed is the trial of the suit in question 4. 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. That is not because the Court regards itself bound to abdicate its jurisdiction in respect of disputes within its cognizance, it merely seeks to promote the sanctity of contracts and for that purpose stays the suit. The jurisdiction of the Court to try the suit remains undisputed, but the discretion of the Court is on grounds of equity interposed and it is for the court, having regard to all the circumstances, to arrive at a conclusion whether sufficient reasons are made out for refusing to grant stay. The question whether the proceedings of the suit are to be stayed with regard to the trial thereof or whether there is necessity of staying the said proceedings obviously becomes a position of fact finding in several litigations before the Court 5. This situation gains ground in the language of the provision for stay of legal proceedings where there is an arbitration agreement (Section 23 of the Arbitration Act, 1940) 6. This situation gains ground in the language of the provision for stay of legal proceedings where there is an arbitration agreement (Section 23 of the Arbitration Act, 1940) 6. The factors that weigh in relation to these considerations are as follows :- (i) That the party pleading for stay must be a party to an agreement or one claiming through the said party (ii) There must be his inclusion to a legal proceeding in pursuance of this agreement (iii) In regard to the application of stay it has to be made before filing a written statement or taking any other step in the proceeding in applying for the stay of such proceedings (iv) and it is thereafter the court has to satisfy that there is no sufficient reason why the matter should not be referred to in accordance with the arbitration clause, and finally such person not only at the time when the legal proceedings were commenced but even there after continues to remain ready and willing to do all things necessary to the proper conduct of the arbitration (v) Depending on all such contours of satisfaction, the court even then has a discretion and it may make an order staying the proceedings 7. The exercise of powers is a use of discretion to be exercised having regard to the totality of circumstances specified hereinbefore. Even in a situation of the last weighty factor that the party has expressed his prayer for stay at the earliest stage of the proceedings by saying his readiness to go to arbitration. In other words, readiness and willingness to go to arbitration as well as his approach to the Court with a prayer for stay at the earliest stage of the proceedings would not be the be all and end all of the situation of success for the concerned applicant. The Court has to bear in mind that even after the commencement of arbitration proceedings, the court does not cease to have its control and powers even under the arbitration Act 1940 8. The Court has to bear in mind that even after the commencement of arbitration proceedings, the court does not cease to have its control and powers even under the arbitration Act 1940 8. It is in the light of this prologue, the short dispute between the parties would need a reference for the purpose of deciding this question, namely, as to whether the trial court has exercised discretion on sound principles and whether this court in its appellate jurisdiction is called upon to disturb the same, together with the other question as to whether the ad interim order passed by the trial court on the presentation of the plaint and accompanied by the application for injunction as ordered to continue inspite of the order of stay also requires any disturbance at our hands. On February 28, 1994 the plaintiffs filed the present suit accompanied by an application (I.A. No. 1375/94) for an ex parte order of injunction. By ban order dated March 2, 1994, the trial court granted an ad interim order and injunction restraining the defendants from opening new clinics for Tabe treatment in any part of the Kerala State or use the name Tabe treatment clinics in violation of the terms and spirit of memorandum of understanding executed between the parties on November 5, 1992 9. It is in pursuance of this ex parte order of ad interim injunction that the defendants appeared and filed the impugned application (I.A. No. 1548/94) 10. In the application, it is averred that the memorandum of understanding was signed by the plaintiff/and the defendants and the conditions are reduced into writing in the nature of an agreement between the parties specifying the terms and conditions. It is thereafter averred that the allegations in the plaint that the defendants are procuring spurious medicines from unauthorised sources for tabe treatment of patients are totally incorrect. It is positively averred that the defendants are treating patients on the basis of direction from the plaintiff and applying medicines as supplied by the plaintiffs only. It is then averred that in the plaint certain averments are made solely with a view of getting over the terms of the agreement and for justifying the conduct of the plaintiff in approaching the civil court without resorting to the provisions of the arbitration clause. It is then averred that in the plaint certain averments are made solely with a view of getting over the terms of the agreement and for justifying the conduct of the plaintiff in approaching the civil court without resorting to the provisions of the arbitration clause. In this connection it is urged that the plaintiffs have no case that any step has been taken against the manufacturer of spurious medicines under the relevant provisions of the law 11. It is urged that the agreement, by its Clause 17, covers all disputes to be referred to arbitration. For completion of the fabric the said Clause 17 of the agreement is reproduced hereinbelow: "That all disputes arising in between the first party and the second party treatment clinics in the state of Kerala, or in the interpretation of the provisions of this agreement, or in the accounting of the said operation shall be referred to two Arbitrators, on each, to be appointed by each of the parties. If the dispute does not get settled then both Arbitrators will appoint an Umpire and such arbitration shall be conducted in accordance with the provisions of the Arbitration Act 1940 and the award given by the Umpire shall be treated as final and binding on both parties. The venue of arbitration will be New Delhi." 12. Thereafter it is submitted that the suit is filed only to harass the defendants and to prevent the opening of such centres as per the agreement which gives them exclusive right of the whole State of Kerala for opening and running tabe treatment by the defendants. Referring to the contents of Clause 17 a contention is raised that in the light of this clause of arbitration the suit as framed and filed is not maintainable 13. For the purpose of deciding these appeals we get the averments, summarised in the application, that the plaintiffs have alleged introduction and use of spurious medicines in the treatment in the centres by the defendants which is the cause of action for filing of the suit, amongst others, pleaded in the averments of the plaint. It is already stated that on the filing of the suit the Trial Court granted ad interim order of injunction restraining the defendants from opening the new clinics in pursuance of the agreement 14. It is already stated that on the filing of the suit the Trial Court granted ad interim order of injunction restraining the defendants from opening the new clinics in pursuance of the agreement 14. Apart there-from, the plaint as filed through its prayers in paragraph 8 prays for a declaration that the defendants have no right either to conduct and operate tabe treatment clinics or any similar establishment in pursuance of the agreement, the prayer for permanent injunction restraining the defendants from opening clinics in any part of the State of Kerala, also for a permanent injunction restraining the defendants from enrolling any patients for tabe treatment and ultimately the prayer for rendering full and correct accounts in relation to the terms of the agreement in question, which is described as memorandum of understanding dated November 15, 1992. The learned Judge by the impugned order has passed his decision on the application of certain principles enunciated in para 10 of the impugned order. He has observed that mere raising of such questions in the application for stay would not be enough as also mere ommission to raise the dispute before the suit is filed. It is observed that if there is no dispute between the parties the stay of suit will have to be refused and in this connection all that the petitioners are required to show is that the legal proceedings against them have been started in respect of a matter which is agreed to be referred and if they satisfy that requirement they would be entitled to stay. The parties pinned down to the terms of Ext. A1. The trial court has also observed that in exercise of inherent jurisdiction courts can pass interim orders before the commencement of the arbitration proceedings mainly to preserve status quo and to prevent contractual obligation consistent with the procedure of Civil Procedure Code as may be necessary to the ends of justice 15. It is against this order that both the defendants and the plaintiff through their counsel made submissions. Learned counsel for the appellants (M.F.A. No. 337/94) submitted by taking us through the agreement, especially clause No. 17 thereof, that the plaintiffs cannot file such a suit and the real proceeding which the plaintiff under law are required to initiate would be an application under Section 20 of the Arbitration Act 1940. Learned counsel for the appellants (M.F.A. No. 337/94) submitted by taking us through the agreement, especially clause No. 17 thereof, that the plaintiffs cannot file such a suit and the real proceeding which the plaintiff under law are required to initiate would be an application under Section 20 of the Arbitration Act 1940. The learned counsel contended that there is no dispute that both the parties entered into an agreement dated November 5, 1992 and therefore the agreement being a contract the rights, liabilities and reliefs get completely clustered amongst the terms and conditions of the said agreement and if the agreement specifically and clearly talks about a reference to arbitration proceeding, filing of a suit as framed is not a legal remedy. The learned counsel submitted, on the basis of reference to Section 34 of the Act, that all that is required for the satisfaction of the said provisions of Section 34 has been complied with. To illustrate the submission, the learned counsel submitted that the first action taken by him on the receipt of notice of ad interim injunction is to present this application. The learned counsel submitted that the order is dated March 2, 1994. The defendants received a notice on the next day on March 3, 1994 which was returnable on March 9, 1994. The learned counsel submitted that the present application (I.A. No. 1548/94) was filed even prior to the returnable date on March 7, 1994. The learned counsel took us through the clause and submitted that the learned Judge had no alternative and therefore has rightly stayed the proceedings of the suit. However, the learned counsel submitted that the order staying the suit had its necessary sequeter and as a result thereof the ad interim order could not have continued existence in view of the order of stay. Infact the learned counsel had a grievance with regard to the order of ad interim injunction and its continuance, because the Trial Court had granted stay to his benefit against which he had no grievance. 16. In support of these submissions the learned counsel submitted that once when the proceedings are referred to arbitration and the civil proceedings are stayed the court gets no jurisdiction to continue the ad interim order. 16. In support of these submissions the learned counsel submitted that once when the proceedings are referred to arbitration and the civil proceedings are stayed the court gets no jurisdiction to continue the ad interim order. In this context the learned counsel placed reliance on the provisions of Section 40 of the Arbitration Act dealing with the procedure and power of the court. Relying on Section 41(b) the learned counsel contended that the Court has powers only in connection with the arbitration proceedings and mere reference or stay of civil proceedings will not be understood as commencement of arbitration proceedings. Relying on the said provision the learned counsel submitted that the court's powers are always for the purpose of and in relation to arbitration proceedings, meaning thereby that there should be some arbitration proceedings in the context of which the court can exercise powers. The learned counsel also referred to the second schedule of the Arbitration Act which is referred in Section 41(b) with regard to the exercise of powers as set out there in. The contention of the learned counsel was that unless the arbitration proceedings are in sight either having commenced or in progress the Court's powers cannot come in for consideration. In other words, the learned counsel submitted in the context of the facts before us that all that has taken place here is an order of stay and it cannot be said that arbitration proceedings are in existence and therefore submit the learned counsel that Section 40 would not have any application and it cannot be invoked 17. On the other hand, the learned counsel for the plaintiffs took us through some provisions of Section 41(b) to contend that these words "for the purpose of, and in relation, to" arbitration proceedings would have to be considered meaningfully in the context of the provisions of the Arbitration Act and the rules of arbitration proceedings with the concerned court. The learned counsel took us through the several provisions of the Act and submitted that the court gets concern with the arbitration proceedings in manifold manner. Illustratively reference to Section 31 was made which requires the award in the court having jurisdiction in the matter to which the reference relates. Reference was also made to Section 28 empowering them to make an award by its enlargement. Illustratively reference to Section 31 was made which requires the award in the court having jurisdiction in the matter to which the reference relates. Reference was also made to Section 28 empowering them to make an award by its enlargement. Referring to other provisions of the Act learned counsel submitted that with reference to the arbitration proceeding the court has control with regard to the award and it has powers to modify and to remit it back and the powers to enforce the terms of the award. In other words, the learned counsel submitted that an arbitration proceeding under the Arbitration Act cannot be considered as independent and separate from the court in the context. It is in the light of these submissions and the background the learned counsel submitted that the provisions of Section 41 would require consideration. With reference to the true and correct meaning of the phrase "for the purpose of and in relation to" appearing in the said provision, the learned counsel submitted that the Court has all the powers to regulate and control the arbitration proceedings and it is only in this context the phrase in question would have to be considered. The learned counsel also submitted that in such a situation, reference to the second schedule would be illustrative of the said exercise of the powers of the Court under Section 41 of the Act. Section 41 of the Act specifically enact that the provisions of the Code of Civil Procedure shall apply to all the proceedings before the Court and to all appeals under the Act. This application of the provisions of the Code gets further illustrated by reference making it clear that the Court has power of making orders in respect of any of the matters set out in the second schedule, as it has for the purpose of, and in relation to, any proceedings before the Court. Continuing the submission the learned counsel referred us to the provisions of the second schedule by relying on Clauses 3 and 4 18. It would be necessary to reproduce these clauses 3 and 4 as follows 3. Continuing the submission the learned counsel referred us to the provisions of the second schedule by relying on Clauses 3 and 4 18. It would be necessary to reproduce these clauses 3 and 4 as follows 3. The detention, preservation or inspection of any property or thing which is subject of the reference or as to which any question may arise therein and authorising for any of the aforesaid purposes any person to enter upon or into any land or building in the possession of any party to the reference, or authorising any samples to be taken, or any observation to be made, or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full information or evidence 4. Interim injunction or the appointment of a receiver It is true that these clauses empower the court to exercise power for the detention and preservation and inspection of any property which is the subject of the reference or as to which any question may; arise therein and authorising for any of the aforesaid purpose in person, it would be seen with this Clause No. 3 gives all powers to the Court for preservation of the subject matter of the litigation. Clause 4 directly relates to interim injunction and the appointment of a receiver. Apart from the submission relating to the text of the provision, the learned counsel placed reliance on the decision of the Andhra Pradesh High Court M/s. Vijayawa Transport, Hyderabad v. Andhra Pradesh State Civil Supplies Corporation Ltd. to urge that the language of the Section as interpreted therein also supports his submission. The learned counsel specifically placed reliance on the observations in paragraph 4 of the judgment to the following effect Construing the language of Section 41 of the Arbitration Act and considering its purpose, we find no justification to give that section such a restricted interpretation that would deny a civil court the necessary adjunctive authority and jurisdiction to entertain any application and grant of any interim relief so essential for administration of justice ................. It follows, there fore that court jurisdiction to grant an interim relief should not be lightly denied by interpretation unless the language used by the statute is intractable. It follows, there fore that court jurisdiction to grant an interim relief should not be lightly denied by interpretation unless the language used by the statute is intractable. We not only find that there is no such clear words of limitation used in Section 41 of the Arbitration Act compelling us to deny the Court Jurisdiction, to grant an interim relief till an Arbitrator is appointed by on the contrary we also find the phrase 'arbitration proceeding' is wide enough to justify the granting of interim relief even before an arbitrator is appointedIt must be stated that in the context of the discretion the Division Bench of the Andhra Pradesh High Court was aware of a different view of this Court Baby Paul v. Hindustan Paper Corporation Ltd. 1978 AIR(Kerala) 223), holding that the arbitration proceedings commenced only on the arbitrator getting authority to Arbitrate and act on himself and consequently holding that the applicability of Section 41 of the Arbitration Act would automatically get postponed till the court appoints an arbitrator under Section 20 of the Act. Till then the Court is not competent to pass any order in respect of those matters anticipating reference. It will have to be specifically held that, in the view, we are taking the said decision in Baby Paul's case taking such a view is not a good law and a correct decision. The learned counsel also placed reliance on the decision of the Bombay High Court, Vashdev Bheroomal Pamaani v. M/s. M. Bipinkumar and Co. 1987 AIR(Bom) 226), in support of the submission that the Court gets jurisdiction to grant exparte ad interim injunction and subsequently in the event of stay of the proceedings of the suit, if justified on the factual situation, there is no necessity of staying interim injunction also and the Court has powers to deal with the application for temporary injunction even though the proceedings of the suit are stayed. In the process of reasoning in the said decision not only the provisions of Section 41 and Item No. 4 of the second schedule is taken into consideration but it has also been observed that the Arbitrators do not have any powers under the Arbitration Act to grant interim orders for the protection of the subject-matter of the dispute. In the process of reasoning in the said decision not only the provisions of Section 41 and Item No. 4 of the second schedule is taken into consideration but it has also been observed that the Arbitrators do not have any powers under the Arbitration Act to grant interim orders for the protection of the subject-matter of the dispute. It is further observed that the powers to pass interim orders by the Court can be exercised in respect of any of the matters set out in the second schedule for the purpose of, and in relation to, arbitration proceedings, even before proceedings under some other section of the said Act are started, but only for the purpose of, and in relation to the arbitration proceedings. It is also necessary to refer to a decision of this Court in regard to the submissions of the learned counsel for the plaintiff based on Section 10 of the Civil Procedure Code to the effect that what is stayed is the trial of the suit and in the process the court has complete jurisdiction to preserve and look after the subject-matter of the proceedings and pass necessary and proper orders in regard thereto. The learned counsel submitted that stay of civil proceedings as contemplated under Section 34 of the Arbitration Act cannot be considered differently from the principles under Section 10 of the Code of Civil Procedure with regard to the consequences of the stay of the proceedings. Making submission, para materia, by reference to Section 10 and the decision of this Court Balakrishnan v. Velayudhan 1979 KLT 827), the learned counsel submitted that the interlocutory order in the nature of issue of injunction or appointment of a receiver or attachment before judgment cannot be regarded as a matter affecting the trial of the suit. In other words, the learned counsel submitted that what is stayed by the impugned order is the trial of the suit and there is no legal impediment in the continuance of the ad interim order that is already passed and prior to the present defendants coming on the scene, in regard to its continuance and subsequent orders in regard there to 19. The cumulative effects of the above positions are that merely because an application is made at the first stage of the proceedings, even before the filing of the written statement, it cannot be said that these prompt acts would be the deciding factors in relation to the question of stay. Additionally, the order of stay is not synonimous with the Court losing all powers in regard to the proceedings and it would not be lost of the seisin over the proceedings by mere order of stay by referring the parties to arbitration. The powers of the Court, for the purpose of and in relation to the arbitration proceedings are wide enough and are to be exercised in the spirit of the principles relating to the grant of injunction, relating to the attachment before judgment and relating to the appointment of receiver as the occasion may arise on the principles of justness and convenience, its balance and in the interest of justice. Such a power is essentially discretionary in nature and the appellate Court has to be more than slow in discharging if such discretion is used either way. The Appellate Court should not interfere unless it comes to the conclusion that discretion has not been judicially exercised, discretion has been exercised by ignoring certain material aspects or by totally misreading the factual position and all this is to be approached with an attitude that the trial court in the matters of discretion has almost a jurisdiction of finality 20. On the factual positions, as we have stated above the learned Judge cannot be said to be wrong in the use of his discretionary powers. Taking into consideration the averments in the plaint and prima facie grant of ad interim injunction, in our judgment the trial court is also more than right in continuing the interim injunction and deciding to deal with it independently apart from and inspite of the order of interim stay 21. For all the above reasons both the appeals stand dismissed and the impugned order dated March 30, 1994 in I.A. 1548/94 in O.S. 1984/94 passed by the learned second Additional Sub Judge, Ernakulam stands confirmed. In the circumstances there shall be no order as to costs.