REVA KHETRAPAL, J.

1. This appeal is directed against the judgment and decree of the learned Additional District Judge dated 21.05.2009 wherein and whereunder the suit filed by the plaintiff, being Suit No.611/2008 was held to be hit by Section 5 of the Arbitration and Conciliation Act, 1996 and hence not maintainable before the Civil Court.

2. The plaintiff, who is the appellant in the appeal, filed a suit for declaration and permanent injunction, inter alia, with the following prayers:-

“a. Pass a decre of declaration that the request for the arbitration made by the defendant No.1 on 18/03/08 bearing reference no.1634 submitted by the defendant No.1 to defendant No.2 as illegal and invalid and the impugned notice issued by defendant No.2 on 20/03/2008 pursuant thereto and/or relating thereto as illegal, invalid and void;

b. Pass a decree of declaration that the defendant No.2 has no jurisdiction and initiation of arbitration proceeding vide its letter dated March 20, 2008 is illegal, invalid and void; c. Pass a decree of permanent injunction against defendant No.1, its agent, sole proprietor and employees etc. from continuing to pursue the reference of arbitration and/or commence arbitration proceedings;

d. Pass a decree of permanent injunction prohibiting defendant No.2, its agent, officers and employees, etc. from acting upon and commencing any proceedings pursuant to the impugned notice no. ref. no. ICA/1634/AC/1631 dated 20/03/2008.”

3. The facts as alleged in the plaint are as follows:- (i) The plaintiff, a Government company within the meaning of Section 617 of the Companies Act, 1956, had entered into an agreement with the defendant No.1, which is the sole proprietory concern of one Mr. Kishore Jain at Mumbai, involved in the business of bullion (gold and silver), jewellery, diamonds, etc., on the 1st day of October, 1998, whereby the defendant No.1 was appointed as the General Sales Representative of the plaintiff for imported gold and silver for delivery at Ahmedabad.

(ii) The said agreement contained an arbitration clause, being Clause No.14 of the Agreement, which is as under:-

“14. DISPUTE: The jurisdiction for all disputes covered under the agreement shall be Indian Council for Arbitration, Mumbai (India). The Indian Arbitration Act, 1940 and the rules there under any statutory modifications thereof for the time being in force shall be applied under this agreement.”

(iii) As per the terms and conditions of the agreement, the defendant No.1 was to be paid 25% of the premium earned by the plaintiff on the import of gold and silver under the OGL scheme for delivery at Ahmedabad. The said contract was extended from time to time and finally it came to an end on 31st March, 2006.

(iv) On 30.03.2007, the plaintiff got issued a legal notice to the defendant No.1 through its counsel wherein the plaintiff directed the defendant No.1 to remove the logo of the plaintiff from the letterhead of the defendant No.1.

(v) The defendant No.1 through its counsel submitted a reply dated 19.04.2007 to the aforesaid legal notice of the plaintiff, stating that the scope of the agreement dated 01.10.1998 had been extended by the plaintiff agreeing to pay commission at 25% of the premium earned in respect of any business brought/introduced by the defendant No.1 to the plaintiff, as the plaintiff’s general sales representative.

(vi) On 22.11.2007, the defendant No.1 got issued a legal notice to the plaintiff seeking payment of the premium earned by the plaintiff between the years 1998 to 2006. The defendant No.1 also sought initiation of arbitration proceedings and named Dr. Justice B.P. Saraf as its arbitrator, requesting the plaintiff to accept him as sole arbitrator.

(vii) On 11.12.2007, the plaintiff through its counsel replied to the legal notice of the defendant No.1 dated 22.11.2007, clearly rejecting the claim of the defendant No.1, stating that there was no such agreement between the plaintiff and the defendant