Sounds like half of what they call a mock cable. The one stitch that's passed over the next 2 sts makes like a belt around the middle of the next 2 sts.
In English, your instructions say, Knit 3 stitches. [okay, 1-2-3. Knitted and on you RH needle] Then take the first stitch [this will be the 3rd one from the tip on your RH needle, the very first of the 3 sts that you knitted] and pass it over the other 2 sts [yep, just what it says. This takes your 3 sts down to 2 sts with a belt around their waists.]
What does the row after that call for? Like Mirl56 says, there needs to be an increase for each of those mock cables - usually it's a yarn-over in the middle of the 2 clumped-together sts.
Makes a pretty pattern.