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Civil Miscellaneous Application No. 2310 in Suit No. 93 of 1976, decided on 14th March 1977.

‑‑ Use of word "shall" or "may" by itself not decisive‑Words no longer conclusive or unerring index of Legislature's intention repre senting permissive or compulsive nature of act intended to be done.

‑‑Court's jurisdiction‑Not to be easily ousted.‑[Jurisdiction].

‑‑ S. 3 and Arbitration Act (X of 1940), S. 34‑Word "shall" in S. 3 of 1937 Act‑To be construed merely as "may" so as to prevent ouster of ordinary jurisdiction of Court by agreements of parties‑-- Court possesses power to refuse stay of an application under provisions of S. 3 of 1937 Act.‑[Words and phrases‑Interpretation of statutes]. A.

A. Rauf for Plaintiff.

Jan Muhammad Dawood for Defendant No. 5.

Date of hearing : 31st January 1977.

This is an application under section 3 of the Arbitration (Protocol and Convention) Act, 1937 by the defendant No. 5, the consignors for stay of the suit filed by the plaintiff insurance company in which the other defendants are the carriers of the cargo allegedly short‑shipped or short -landed. The case of the respondent No. 5 is that under the contract for the supply of the cargo in question between them and the buyer, the Trading ‑Corporation of Pakistan. the arbitration clause provides for settlement of any dispute arising therefrom in accordance with the Rules of F. O. S. F. A. Contract No. 60 including the clause of the domicile. Since the other defendants to this suit are not parties to this contract at best the defen dant No. 5 can ask for stay of the suit against themselves and not others which would mean that the suit will be tried piecemeal for while the suit against defendant No. 5 will be stayed it will continue as against the others defendants. Such a course is most undesirable and, therefore, unless compelled by cogent reasons to be avoided. The argument of Mr. Jan Muhammad Dawood, the learned counsel for defendant No. 5 was that stay under said section 3 was not within the discretion of the Court but mandatory for the words used in the section are "shall make an order staying the proceedings" which words were sought to be contrasted by the learned counsel with reference to section 34 of the Arbitration Act, 19.10 which by the use of the word "may" give discretion to the Court to make an order of stay of the proceedings. The use of word "shall" or "may" by itself is not decisive. These words have long ceased to be a conclusive or l, unerring index of the intention of the Legislature as representing tae permissive or compulsive nature of the act intended to be done. On principle) I am unable to understand why an agreement to go to a foreign arbitration must be considered more sacred than an agreement to go to arbitration under Arbitration Act, 1940. It will be noticed that in order to enable a party to obtain a stay under section 34 he has to show that he was ready and willing to do all things necessary for the proper conduct of the arbitration while section 3 makes no such provision. It will follow therefrom that if the word "shall" in section 3 gives a mandatory meaning then notwithstanding a party's unwillingness to proceed with the arbitration or to co‑operate in the arbitration, such a party can obtain as a matter of right a stay from the Court making it difficult if not impossible to resolve the disputes between the parties. It is a well‑established rule of interpretation that the Court's jurisdiction is not to be easily ousted. If the meaning contended by the learned counsel for the defendant No. 5 is given to section 3 the Court's discretion in the matter will be subject to agreement between the parties which could not have been the intention of the Legislature. In my view, therefore, the word "shall" in this section has to be construed merely as "may" so as to prevent the ouster of the ordinary jurisdiction of the Court by agreements of C parties and Court will, therefore, have power to refuse stay of any application under the provisions of section 3 though other conditions of the section are satisfied.

2. Since there is not an appropriate case to enforce the arbitration agreement limited as it is between the plaintiff and the defendant No. 5, only this application is dismissed with cost.

S. Q Application dismissed.

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