' SALIM KHAN, J.---This first appeal against order No,6 of 2006 has been filed by the Government of the N.-W.F.P., and others against Khalid Khan and others. A suit was filed by Khalid Khan and six others against the Government of the N.-W.F.P., the Conservator of Forest, Hazara Circle and three others for recovery of Rs,11,39,250 on the ground that the plaintiffs sustained losses due to non-sale of plants of the plaintiffs and misappropriation of the amount of the plaintiffs by the defendants.
The defendants were served but they did not submit written statement, and after adjournments, filed petition for sending the matter to arbitrator in accordance with the agreement executed between the parties.
2. In fact the defendants Nos. 4 and 5 were placed ex parte on 23-10-2004, but an application for setting aside the ex parte order was submitted by them on 22-11-2004. A reply to the same was submitted by the plaintiffs on 11-2-2005, but the ex parte order was withdrawn on'the said date. It was on 4-4-2005, the date of submission of writtenstatement, that the defendants sought adjournment and further adjournment was requested for on 18-4-2005. Further adjournment was also granted to the defendants on 9-5-2005.
3. The main ground for dismissing the petition for sending the matter to the arbitrator was that the defendants had taken steps in proceedings and had not submitted application promptly. The adjournments requested for and granted to the defendants for submission of written statement were declared as steps taken by the defendants and it was held that the defendants had nut taken up the issue of sending the matter to the arbitrator at the earliest and, hence, had relinquished/ waived their rights for such request.
4. I heard the learned D.A.G. For appellant and the learned counsel for the respondents and perused the record. The learned D.A.G. Contended that the Government had not wasted any time as preparations for submitting the point of view of the Government/defendants were being made and the written statement was not yet submitted when the defendants took up the issue of sending the matter to the Arbitrator in accordance with the terms of the agreement between the parties. The learned counsel for the respondents relied in PLD 1978 Quetta 215, PLD 1981 SC 553, 1987 CLC 205 and PLD 2006 SC 196 and contended that, in the light of the provisions of section 34 of the Arbitration Act, 1940, the defendants had lost their right to make the request in question.
5. In the case mentioned in PLD 1978 Quetta 215, it was held that it was always a question of fact whether a particular act of the defendant amounted to a step in the proceedings and no hard and fast rule could be made in that behalf, but certain circumstances mentioned therein were relevant facts to determine the conduct of the defendant in that behalf. It was further held that the delay caused to the lethargic attitude of the defendant or his negligence were some of the facts showing that the defendant did not want to get the aid of arbitration clause. It was also held that applications moved for adjournments or otherwise before submission of written statement were further steps in the proceedings.
6. In the case mentioned in PLD 1981 SC 553 it was held that the mere existence of a clause providing for arbitration did not stop a suit or other legal proceedings in Court. It only entitled a party to have the legal proceedings stayed. In order that the stay might be granted under the provisions of section 34 of the Arbitration Act, 1940, certain conditions must be fulfilled and the party must take the objection and apply for stay of proceedings before taking any step, for example, the filing of written statement, that is, before he places his cards on the table. It was further held that the acts of the counsel for the appellant were not indicative of appellant's acquiescence to the method adopted by the respondent ofhaving the dispute decided by the Court or that the appellant had displayed submission to the jurisdiction of the Court or had abdicated their claim to have the matter decided in the manner provided in the arbitration clause of the agreement. In that case, the application under section 34 was granted. The proceedings in the suit were stayed with the direction that the dispute would be referred to arbitration in accordance with the arbitration agreement between the parties.
7. In case reported as 1987 CLC 2205, it was held that steps taken by applicant seeking stay of proceedings, clearly showing both acquiescence in jurisdiction of Court as well as participation in proceedings and promoting its progress, had disentitled applicant to seek stay of proceedings under section 34. It was held that the expression "taking any other steps in the proceedings" was of general nature and had wide import. It would include in its meaning any action by the party which amounts to his participation in the proceedings or its further progress. It would also include any step by the party which would show that he has acquiesced in the jurisdiction of the Court.
8. The criteria mentioned in the judgment reported as PLD 2006 SC 196 clearly indicates that plea of referring matter to arbitrator should he raised promptly at the very first opportunity and delay on any pretext would estop party from seeking stay of proceedings in the suit, and frequent requests for adjournment for filing written statement would fall within the ambit of phrase "taking any other steps in the proceedings" as used in section 34 of Arbitration Act, 1940. The application for stay of the proceedings was, therefore, dismissed.
9. In the instant case, after setting aside the ex parte proceedings/order against the respondents, the respondents requested for adjournments for submission of written statement, which amounted to their submission to the jurisdiction of the Court and their acquiescence also. By making such requests for adjournment, the appellants (then defendants) gave the mind to the opposite party that they were ready to contest the suit before the learned trial Court and were preparing for submission of written statement. There was every opportunity for the defendants to submit application for stay of proceedings at the earlier before such requests and adjournments, as they had the knowledge of the suit and have been praying for setting aside the ex parte order C against them. The defendants could make up mind urgently and could submit an application under section 34 of the Arbitration Act, 1940 at the earliest without requesting for adjournments for submission of written statement.
10. In these circumstances, I do not find any merit in the present appeal which is hereby dismissed, but the parties are left to bear their own costs.
Announced.