JUDGMENT 1. This Application is taken by the Defendant in the Suit in C.S. No. 934 of 2010 to refer the dispute between the Plaintiff and the Defendant in respect of the loan agreements, dated 9.3.2009, 16.4.2009, 28.4.2009 and 9.6.2009 to arbitration and consequently dismiss the Plaint in C.S. No. 934 of 2010. 2. The brief acts which are necessary for the disposal of the above said application are as follows: a. The Respondent/Plaintiff has filed the above Suit for the following relief: a. Directing the Defendant to pay a sum of Rs. 30,00,000/- as damages for non-release of documents in respect of the schedule mentioned Cranes, for which repayment had been fully made by the Plaintiff, which has caused financial loss to the Plaintiff. b. Declaring the Letter dated 11.11.2010 sent by the Defendant to the Plaintiff as null and void, non-est in law and void ab initio and not binding upon the Plaintiff. c. Permanent injunction restraining the Defendant, their men, servants, agents, Legal Representatives and assigns or any one claiming through or under them, from in any manner interfering with the business of the Plaintiff, on the basis of their Letter dated 11.11.2010 without releasing to the Plaintiff, the original documents in respect of the 5 of the schedule mentioned Cranes (items 1 to 4 & 6) for which the Plaintiff had effected full repayment. 3. The case of the Plaintiff is that during the year 2006 the Defendant sanctioned a financial assistance to the tune of Rs. 3.00 crores, which was released in two parts, lastly in 2009. The Plaintiff has given his property as security and also signed in blank Bond papers. The Defendant had not come forward to provide the Plaintiff with a copy of the Loan Agreement entered into between them for availing of the above financial assistance. The said loan amount of Rs. 3.00 crores was sanctioned by the Defendant for purchase of ten Cranes as mentioned in the Schedule. 4. It is the further case of the Plaintiff that there is no dispute with regard to settlement of two Cranes and they have settled their money towards three more Cranes and hence the amount still due to the Defendant is only in respect of the balance of five Cranes. Till date, the Plaintiff has paid a sum of Rs. 3,90,97,204/-. In the year 2010-11, the Plaintiff has paid more than Rs. Till date, the Plaintiff has paid a sum of Rs. 3,90,97,204/-. In the year 2010-11, the Plaintiff has paid more than Rs. 77,57,156/- to the Defendant. Admittedly, the balance amount to be paid by the Plaintiff to the Defendant is only Rs. 68,05,054/- as on 13.11.2010. The Plaintiff is taking all steps to settle the balance due. While so, the Defendant sent an E-mail dated 21.6.2010 threatening the Plaintiff with seizure of the Cranes in the event of the Plaintiff is not making any further payments within five days thereof. 5. It is the further case of the Plaintiff that they have cleared repayment in respect of 5 out of 10 Cranes and they owe only a sum of Rs. 68,05,054/- covering the balance of five Cranes only. In spite of repeated demands and requests by the Plaintiff seeking issuance of No Due Certificate and return the original documents regarding five Cranes, the Defendant denied to provide the same. On the other hand, the Defendant has been giving pin-pricks to the Plaintiff and causing damages to the Plaintiff by sending his employees with henchmen and seizing the Cranes and thereby the Plaintiff is unable to discharge its duties to its customers, who in turn claim damages, for unfinished work. Hence, the above Suit has been filed for the reliefs stated supra. 6. On appearance, the Defendant has filed the above application under Section 8 of the Arbitration and Conciliation Act, 1996 to refer the matter to arbitration. 7. In the Affidavit filed in support of the above application, it is stated that the Plaintiff had borrowed money and have executed Loan Agreement in respect thereof with the Defendant-Company. The Plaintiff has executed four contracts alone with the Defendant and the other contracts have been executed by the Director of the Plaintiff-Company in his individual capacity. In the said Agreements, the parties have mutually agreed as follows: “22(a). All disputes, differences any/or claim arising out of this Agreement whether during its subsistence of thereafter shall be settled by arbitration in accordance with the provisions of the Arbitration and Conciliation Act, 1996, or any statutory amendments thereof and shall be referred to the sole Arbitration of an Arbitrator nominated by the Managing Director of the Lender. The Award given by such an Arbitrator shall be final and binding on the borrower to this Agreement. The Award given by such an Arbitrator shall be final and binding on the borrower to this Agreement. It is a term of this Agreement that in the event of such an Arbitrator, to whom the matter has been originally referred dying or being unable to act for any reason, the Managing Director of the Lender, at the time of such death of the Arbitrator or of his inability to act as Arbitrator, shall appoint another person to act as Arbitrator. Such a person shall be entitled to proceed with the reference from the stage at which it was left by his predecessor. (b) The venue of Arbitration proceedings shall be at Chennai. (c) The Arbitrator so appointed herein above, shall also be entitled to pass an Award on the hypothecated asset and also on any other securities furnished by or on behalf of the Borrower.” 8. The Plaintiff after obtaining a blanket stay of repossessing the vehicles by the Applicant has completely stopped paying the amounts due and payable by the Plaintiff to the Defendant. On the aforesaid pleadings, the Applicant/Defendant sought for the dismissal of the Suit by referring the matter to arbitration. 9. The Respondent/Plaintiff filed a Counter reiterating the averments made in the Plaint, which have been set out in the preceding paragraphs. Further, it is stated that the Applicant has not made out a case to refer the dispute for arbitration and the Affidavit filed in support of the Application seeking reference is bereft of merits. On the aforesaid pleadings, the Respondent sought for the dismissal of the above Applications. 10. Heard the learned Counsel on either side. 11. The main submission of the learned Counsel for the Applicant is that the Loan Agreement contains the Clause for Arbitration. When there is a Clause for Arbitration, the Respondent ought to have referred the matter for arbitration and instead of referring the matter to arbitration, he has filed the present Suit. Therefore, by dismissing the Suit, the dispute has to be referred to arbitration. In support of this contention, the learned Counsel for the Applicant relied upon a decision reported in Hindustan Petroleum Corpn. Ltd. v. Pinkcity Midway Petroleums, 2003 (2) CTC 438, wherein it has been held as follows: “13. Therefore, by dismissing the Suit, the dispute has to be referred to arbitration. In support of this contention, the learned Counsel for the Applicant relied upon a decision reported in Hindustan Petroleum Corpn. Ltd. v. Pinkcity Midway Petroleums, 2003 (2) CTC 438, wherein it has been held as follows: “13. A perusal of this clause clearly shows that the parties to the Dealership Agreement had agreed to refer their dispute arising out of the Agreement, of whatsoever nature it may be, to an Arbitrator as contemplated in that Agreement. Section 8 of the Act in clear terms mandates that a Judicial Authority before which an action is brought in a matter which is the subject of an Arbitration Agreement to refer such parties to arbitration, the language of this Section is unambiguous.” 12. Further, by relying upon the above passage in the said decision, the learned Counsel for the Applicant submitted that when an Agreement between the parties contains the clause for arbitration, irrespective of the nature of the dispute, if such matter is brought before the Judicial Authority, such Judicial Authority shall refer the matter to arbitration. 13. Per contra, the learned Counsel for the Respondent submitted that the relief sought for in the Plaint particularly permanent injunction restraining the Defendant from in any manner interfering with the business of the Plaintiff on the basis of the Letter, dated 11.11.2010 without releasing to the Plaintiff the original documents in respect of the item 5 of the Schedule mentioned Cranes, would not fall within the purview of an arbitrable issue and therefore, there is no need to refer the subject matter for arbitration. 14. In support of his contention the learned Counsel for the Respondent relied on the following decision: a. Sukanya Holdings Pvt. Ltd. v. Jayesh H. Pandya, 2003 (2) CTC 431; b. Arul Singh v. Sunil Kumar Singh, 2008 (2) CTC 856. 15. By way of reply, the learned Counsel for the Applicant submitted that even if there is a prayer for injunction, the same could be referred to an Arbitrator. 16. In support of his contention, the learned Counsel for the Applicant relied on the following decision: a. Olympus Superstructures Pvt. Ltd. v. Meena Vijay Khetan, 1999 (2) Arb.LR 695 (SC). In the said decision it has been held as follows: “32. 16. In support of his contention, the learned Counsel for the Applicant relied on the following decision: a. Olympus Superstructures Pvt. Ltd. v. Meena Vijay Khetan, 1999 (2) Arb.LR 695 (SC). In the said decision it has been held as follows: “32. One of the points raised in the grounds in this Court is that the grant of Specific Performance is discretionary and the discretion to grant or not to grant Specific Performance has been conferred by the Specific Relief Act, 1963 on the Civil Court and hence the Arbitrator cannot be deemed to have been empowered to grant such a relief. We may point out that the Punjab High Court in Laxmi Narayan v. Raghubir Singh, MANU/PH/0104/1956, the Bombay High Court in Fertiliser Corporation of India v. Chemical Construction Corporation, ILR (1974) Bom 856 and the Calcutta High Court in Keventer Agro Ltd. v. Seegram Comp. Ltd., Apo 498 of (1997) & Apo 449 of (401) (dated 27.1.98) have taken the view that an Arbitrator can grant Specific Performance of a contract relating to immovable property under an award. No doubt the Delhi High Court in Smt. Sulochana Uppal v. Shri Surinder Sheet Bhabri, AIR 1991 Del. 138 , has, however, held that the Arbitrator cannot grant Specific Performance. The question arises as to which view is correct. 34. In our opinion, the view taken by the Punjab, Bombay and Calcutta High Courts is the correct one and the view taken by the Delhi High Court is not correct. We are of the view that the right to Specific Performance of an Agreement of Sale deals with contractual rights and it is certainly open to the parties to agree with a view to shorten litigation in regular Courts - to refer the issues relating to Specific Performance to arbitration. There is no prohibition in the Specific Relief Act, 1963 that issues relating to Specific Performance of contract relating to immovable property cannot be referred to arbitration. Nor is there such a prohibition contained in the Arbitration and Conciliation Act, 1996 as contrasted with Section 15 of the English Arbitration Act, 1950 or Section 48(5)(b) of the English Arbitration Act, 1996 which contained a prohibition relating to Specific Performance of contracts concerning Immovable property. 35. It is stated in Halsburys' Laws of English, 4th Ed. (Arbitration Vol. Nor is there such a prohibition contained in the Arbitration and Conciliation Act, 1996 as contrasted with Section 15 of the English Arbitration Act, 1950 or Section 48(5)(b) of the English Arbitration Act, 1996 which contained a prohibition relating to Specific Performance of contracts concerning Immovable property. 35. It is stated in Halsburys' Laws of English, 4th Ed. (Arbitration Vol. 2 para 503) as follows: Nature of the dispute or difference: The dispute or difference which the parties to an Arbitration Agreement agree to refer must consist of a justiciable issue triable civilly. A fair test of this is whether the differences can be compromised lawfully by way of accord and satisfaction (Cf. Bacon's Abridgement and Award A). Reference is made there to certain disputes like Criminal offences of a public nature, disputes arising out of illegal agreements and disputes relating to status, such as divorce, which cannot be referred to arbitration. It has, however, been held that if in respect of facts relating to a Criminal matter, (say) physical injury, if there is a right to damages for personal injury, then such a dispute can be referred to arbitration Keir v. Leeman, 1846 (9) Q.B, 371. Similarly, it has been held that a husband and wife may, refer to arbitration the terms on which they shall separate, because they can make a valid agreement between themselves on that matter Soilleux v. Herbst, 1801 (2) Bos 444; Wilson v. Wilson, 1848 (1) HL Cas 538; Cahill v. Cahill, 1883 (8) App Cas 420. 36. Further, as pointed in the Calcutta case, merely because there is need for exercise of discretion in case of Specific Performance, it cannot be said that only the Civil Court can exercise such a discretion. In the above case Ms. Ruma Pal, J. observed: … merely because the Sections of the Specific Relief Act confer discretion on Courts to grant specific performance of a contract does not means that parties cannot agree that the discretion will be exercised by a forum of their choice. If the converse were true, then whenever a relief is dependent upon the exercise of discretion of a Court by statute e.g. the grant of interest or costs, parties should be precluded from referring the dispute to arbitration. We agree with this reasoning. If the converse were true, then whenever a relief is dependent upon the exercise of discretion of a Court by statute e.g. the grant of interest or costs, parties should be precluded from referring the dispute to arbitration. We agree with this reasoning. We hold on Point 3 that disputes relating to Specific Performance of a contract can be referred to arbitration and Section 34(2)(b)(i) is not attracted. We overrule the view of the Delhi High Court. Point 3 is decided in favour of Respondents.” 16a. Relying upon the dictum laid down in the above judgment the learned Counsel for the Applicant submitted that even a prayer for injunction can be referred to Arbitration if the Agreement contains the clause for Arbitration. 17. Countering the said submissions of the Applicant, the learned Counsel for the Respondent submitted that when the subject matter includes subject matter of Arbitration Agreement as well as other disputes, such subject matter cannot be referred to arbitration as there is no provision for splitting cause of parties and refer the subject matter of Suit to Arbitrators. In this regard, the learned Counsel relied upon the decisions referred to supra in Paragraph 14 of this Order. 18. In the decision relied upon by the learned Counsel for the Respondent/Plaintiff reported in Sukanya Holidays Pvt. Ltd. v. Jayesh H. Pandya, 2003 (2) CTC 431, it has been held as follows: “12. For interpretation of Section 8, Section 5 would have no bearing because it only contemplates that in the matters governed by Part 1 of the Act, Judicial authority shall not intervene except where so provided in the Act. Except Section 8, there is no other provision in the Act that in a pending Suit, the dispute is required to be referred to the Arbitrator. Further, the matter is no required to be referred to the Arbitral Tribunal, if — (1) the parties to the Arbitration Agreement have not filed any such Application for referring the dispute to the Arbitrator, (2) in a pending Suit, such Application is not filed before submitting first statement on the substance of the dispute; or (3) such Application is not accompanied by the original Arbitration Agreement or duly certified copy thereof. This would, therefore, mean that Arbitration Act does not oust the jurisdiction of the Civil Court to decide the dispute in a case where parties to the Arbitration Agreement do not take appropriate steps as contemplated under sub-sections (1) & (2) of Section 8 of the Act. 13. Secondly, there is no provision in the Act that when the subject matter of the suit includes subject matter of the Arbitration Agreement as well as other disputes, the matter is required to be referred to arbitration. There is also no provision for splitting the cause or parties and referred the subject matter of the suit to the Arbitrators. 14. Thirdly, there is no provision - as to what is required to be done in a case where some parties to the suit are not parties to the Arbitration Agreement. As against this, under Section 24 of the Arbitration Act, 1940, some of the parties to a Suit could apply that the matters in difference between them be referred to arbitration and the Court may refer the same to arbitration provided that the same can be separated from the rest of the subject matter of the Suit. Section also provided that the Suit would continue so far as it related to parties who have not joined in such Application. 15. The relevant language used in Section 8 is - in a matter which is the subject matter of an Arbitration Agreement, Court is required to refer the parties to arbitration. Therefore, the Suit should be in respect of ‘a matter’ which the parties have agreed to refer and which comes within the ambit of Arbitration Agreement. Where, however, a Suit is commenced - ‘as to a matter’ which lies outside the Arbitration Agreement, there is no question ‘a matter’ indicates entire subject matter of the Suit should be subject to Arbitration Agreement.” 16. The next question which requires consideration is - even if there is no provision for partly referring the dispute to arbitration, whether such a course is possible under Section 8 of the Act? In our view, it would be difficult to give an interpretation to Section 8 under which bifurcation of the cause of action that is to say the subject matter of the Suit or in some cases bifurcation of the Suit between parties who are parties to the Arbitration Agreement and others is possible. In our view, it would be difficult to give an interpretation to Section 8 under which bifurcation of the cause of action that is to say the subject matter of the Suit or in some cases bifurcation of the Suit between parties who are parties to the Arbitration Agreement and others is possible. This would be laying down a totally new procedure not contemplated under the Act. If bifurcation of the subject matter of a Suit was contemplated, the legislature would have used appropriate language to permit such a course. Since there is no such indication in the language, it follows that bifurcation of the subject matter of an action brought before a Judicial Authority is not allowed. 17. Secondly, such bifurcation of Suit in two parts, one to be decided by the Arbitral Tribunal and other to be decided by the Civil Court would inevitably delay the proceedings. The whole purpose of speedy disposal of dispute and decreasing the cost of litigation would be frustrated by such procedure. It would also increase the cost of litigation and harassment to the parties and on occasions there is possibility of conflicting judgments and orders by two different forums. 19. Further, the Apex Court in the decision reported in Arul Singh v. Sunil Kumar Singh, 2008 (2) CTC 845 has held as follows: “9. The first relief claimed by the Plaintiffs in the Suit is a decree for declaration that the reconstituted Partnership Deed dated 17.2.1992 was illegal and void and there was no intention or desire of Shri Rajendra Prasad Singh to retire from the partnership and further that the Plaintiffs being heirs of Shri Rajendra Prasad Singh will be deemed to be continuing as partners to the extent of his share. It is true that the Plaintiffs have also sought rendition of accounts and their share of profits from the partnership as well as interest over the unsecured loan and the principal amount of unsecured loan on rendition of accounts. For getting this relief, the Plaintiffs undoubtedly rely upon the partnership deed dated 13.1.1989. However, this Deed of 1989 could be relied upon and form the basis of the claim of the Plaintiffs only if the Partnership Deed dated 17.2.1992 was declared and void. For getting this relief, the Plaintiffs undoubtedly rely upon the partnership deed dated 13.1.1989. However, this Deed of 1989 could be relied upon and form the basis of the claim of the Plaintiffs only if the Partnership Deed dated 17.2.1992 was declared and void. If the deed dated 17.2.1992 was not declared as void and remained valid and operative, the Plaintiffs could not fall back upon the earlier Partnership Deed dated 13.1.1989 to claim rendition of accounts and their share of profits. Therefore, in order to get their share of profits from the partnership business, it was absolutely essential for the Plaintiff Appellants to have the Partnership Deed dated 17.2.1992 declared as illegal, void and inoperative. The relief for such a declaration could only be granted by the Civil Court and not by an Arbitrator as they or Shri Rajendra Prasad Singh through whom the Plaintiffs derive title, are not party to the said deed. The Trial Court had, therefore, rightly held that the matter could not be referred to arbitration and the view to the contrary taken by the High Court is clearly illegal.” 20. The dictum laid down in the above Judgment would reveal that if there is a Clause for arbitration, the mater can be referred to arbitration. But when the subject matter of the Suit includes the subject matter of the arbitration as well as the other disputes not covered under the agreement the Civil Court can proceed with the Suit. So far as the instant case is concerned, the Respondent had sought for a permanent injunction as against the Applicant herein on the allegation that the Defendant has been giving pinpricks and causing damages to the Plaintiffs by sending his employees with henchmen and seizing the Cranes and hence, the Plaintiff is unable to discharge its duties to its customers, who in turn claim damages, for unfinished work. Hence, I am of the opinion that the said nature of relief sought for by the Respondent falls outside the scope of Arbitration Clause as provided in the Agreement between the parties. That apart, I find that the Plaintiff has claimed Rs. 30.00 lakhs as damages for the non-release of the documents of in respect of the Schedule mentioned Cranes for which repayment had been fully made by the Plaintiff. 21. That apart, I find that the Plaintiff has claimed Rs. 30.00 lakhs as damages for the non-release of the documents of in respect of the Schedule mentioned Cranes for which repayment had been fully made by the Plaintiff. 21. Since the dispute is only with regard to the release of the document in respect of which the Applicant has already made payment, I do not find any dispute within the meaning of Arbitration Clause found in the Agreement. Since each Agreement is independent in nature and on that account also I am of the opinion that this Application cannot be entertained and the matter cannot be referred to arbitration. Accordingly, the above Application is dismissed.