The court held that an arbitration agreement must be clear and certain in order to be enforceable, and that a party who seeks a stay of a suit under S. 34 of the Arbitration Act must show that it is ready and willing to proceed with arbitration.

( 1 ) THE plaintiff-respondents in or about June 1982 instituted a suit against the defendant-appellant for a decree for Rs. 87, 266. 84 in favour of the plaintiff 1 or the plaintiff 2 (i. e. , the respondents before us); in the alternative, enquiry into the compensation payable by the defendant (i. e. , the appellant before us) to the plaintiffs for the loss and damages suffered and decree for the sum so found due on such Enquiry, Receiver, Costs etc. The fact of the case is that on or about Sept. 8, 1980 the plaintiff No. 2, Kesoram Industries and Cotton Mills Ltd. , delivered to the defendant at Tribeni 72 cases, stated to have contained Viscose Rayon Yarn, for carriage and delivery to the plaintiff to Kesoram Industries and Cotton Mills Ltd. at Amritsar. The defendant accepted the said goods for carriage. On Sept. I3, ' 1980 the truck carrying the said goods met with an accident, as a result of which some of the goods were damaged. On Jan. 12, 1981 the plaintiff No. 2 lodged a claim for Rs. 79, 578. 13 with the defendant. The defendant, however, by a letter dt. Jan. 17, 1981 repudiated the claim of the plaintiff No. 2 and requested the said plaintiff to realise their claim, if any, from the under writers. The defendant also repudiated the claim in the suit and denied their liability to compensate for loss or damages said to have been suffered by the plaintiff No. 2.

( 2 ) THE writ of summons in this suit was served on the defendant on June 28, 1982 and the appellant (i. e. , the defendant) took out an application under S. 34 of the Arbitration Act on July 27, 1982 for staying the suit instituted by the plaintiffs by contending that the transaction between the parties were governed by the Consignment Note No. GR No. CAL 29373 dt. Sept. 8. 1982 which, inter alia, contained an arbitration clause to the effect that : "all disputes with respect to the subject matter of this GR shall be got decided by reference to arbitration. The Manager of the Company shall be the Arbitrator whose decision shall be binding on both parties".

( 3 ) THE respondent before the trial Court (i. e. . the respondent No. 1 before us) opposed the said application made under S. 34 of the Arbitration Act on the grounds, inter alia, that there was no arbitration agreement between the parties and that even if there was such agreement that was vague and uncertain. The respondent also contended before the trial Court that in any event the petitioner (i. e. , the appellant before us) at the time of commencement of the proceedings and still thereafter was not ready and willing to proceed with the arbitration. The respondent also had taken another point before the trial Court that since the Arbitrator, according to the arbitration clause if there was a definite and certain arbitration agreement, was an Officer of the appellant petitioner and as such the said Arbitrator was likely to be biased and he might not act in a fair manner while determining the claim of the respondent.

( 4 ) THE plaintiff 2 in the suit subrogated and or assigned all its rights, title, interest and benefit to the plaintiff 1 in the suit (i. e. , the respondent 1 before us) in respect of the damaged goods and proceeds thereof and all rights, reliefs, actions, claims and remedies in respect thereof which the plaintiff 2 would have against the defendant in the suit (i. e. , the appellant before us) for the said loss and damages.

( 5 ) THE learned Judge held that the arbitration agreement sought to be relied on by the appellant was not clear as to which particular Manager the parties had in mind as arbitrator and as such the said arbitration agreement was vague and uncertain. The learned Judge also held that the appellant petitioner was not ready and willing to refer tile dispute to arbitration as and when the claim was preferred. Accordingly, the learned Judge dismissed the application taken out by the appellant holding that the appellant petitioner was not entitled to an ord