JUDGMENT Das, J. - This is an application under the Indian Arbitration Act made by Birla Jute Manufacturing Company Ltd. (hereinafter referred to as the Defendant-company), for stay of Suit No. 607 of 1947 instituted against it by Tolaram Nathmull (hereinafter referred to as the Plaintiff-firm). 2. The allegations on which this application is sought to be supported are shortly as follows: By a contract in writing, being Contract No. 39A, dated March 13, 1946, the Plaintiff-firm agreed to sell and deliver and the Defendant-company agreed to purchase and pay for 2,000 maunds of mesta upon terms and conditions mentioned in the said contract. The goods were to be delivered at the Defendant-company's mill in July and or August, 1946. The said contract contained an arbitration-clause. As the Plaintiff-firm did not deliver any goods or documents of title during July and the greater part of August, 1946, the Defendant-company, on August 27, 1946, wrote to the Plaintiff-firm, intimating that if the documents of title were not received in due time it would exercise its option under the contract of cancelling the contract on the fifth working day after the due date and of charging the difference between the contract rate and the market rate on the date of cancellation of the contract. Notwithstanding this intimation the Plaintiff-firm failed to deliver the goods or documents of title within the due date, i.e., within August 31, 1946 and consequently, on September 6, 1946, the Defendant-company wrote to the Plaintiff-firm cancelling the contract and informing them that it claimed from the Plaintiff-firm the difference between the contract-rate and the market-rate. On September 14, 1946, the Defendant-company submitted its difference bill claiming Rs. 14,500 in respect of this contract. The Plaintiff-firm not having paid up, the Defendant-company, on or about November 4, 1946, referred the disputes to the Tribunal of Arbitration of the Bengal Chamber of Commerce in terms of the arbitration-clause. In its statement before the Tribunal of Arbitration the Defendant-company claimed Rs. 14,500 as difference between the contract-rate and the market-rate of Trieste or alternatively Rs. 26,680-12-9 as damages on the basis of loss of profit, particulars of which were shown in that statement. The Plaintiff-firm, on or about November 26, 1946, filed a counter-statement before the Tribunal of Arbitration, a copy of which was handed up to me. 14,500 as difference between the contract-rate and the market-rate of Trieste or alternatively Rs. 26,680-12-9 as damages on the basis of loss of profit, particulars of which were shown in that statement. The Plaintiff-firm, on or about November 26, 1946, filed a counter-statement before the Tribunal of Arbitration, a copy of which was handed up to me. There the Plaintiff-firm contended that Trieste was jute and was governed by the Jute (Price Control) Order and that as, on the failure of the Plaintiff-firm to deliver the goods it would have been illegal for the Defendant-company to purchase any Trieste at any rate higher than the maximum controlled rate and as the contract-rate was the same as the maximum controlled rate, there was no difference which the Defendant-company could claim. As regards the alternative claim it was pointed out that the purpose for which the Defendant-company had entered into the contract had not been disclosed to the Plaintiff-firm and the claim for damages on the basis of loss of profit was too remote and untenable. The Defendant-company, on or about December 6, 1946, filed a reply, reiterating its contentions and claims. While the matter was pending before the Tribunal of Arbitration, the Defendant-company was served with a writ of summons in a suit, being Suit No. 607 of 1947, filed in this Court by the Plaintiff-firm against the Defendant-company on or about March 4, 1947. The Defendant-company submits that this suit has been commenced in breach of the arbitration agreement contained in the contract and that, accordingly, the suit should be stayed. 3. Section 34 of the Indian Arbitration Act prescribes certain conditions which, must be fulfilled before the Court may be called upon to exercise its discretion and stay the suit. One of the main conditions is that the legal proceedings sought to be stayed must be in respect of matters agreed to be referred. It is, therefore, necessary to ascertain what the subject-matter of the suit is and then to consider whether such matter has been agreed to be referred. In other words, on an application for stay, the Court will find out what the disputes are and then decide whether those disputes are covered by the arbitration agreement. It is, therefore, necessary to ascertain what the subject-matter of the suit is and then to consider whether such matter has been agreed to be referred. In other words, on an application for stay, the Court will find out what the disputes are and then decide whether those disputes are covered by the arbitration agreement. If, on a scrutiny of the plaint in the light of the affidavits filed in the application and the arbitration agreement, the Court comes to the conclusion that the matters in dispute in the suit are not within the arbitration agreement there is an end of the application for stay. If the Court finds that the suit is in respect of matters agreed to be referred, the Court will have then to enquire whether the other conditions prescribed by the section have been fulfilled and lastly, whether there is any sufficient reason why the matter should not be referred to arbitration. 4. The case made in the plaint and repeated in the Plaintiff-firm's affidavit in opposition to the present application may now be summarised: * * * * [After summarising the allegations in the plaint and the affidavit the Court proceeded as follows:] On the above allegations two alternative cases are purported to be formulated, namely, (i) that the contract was and is void, having been entered into by the parties under a mutual mistake or under a misapprehension of their mutual rights and obligations (para. 2 of the plaint) and (ii) that, if it be held that the Defendant-company is not bound by the description "jute" in the said contract, then the contract was induced by fraud and misrepresentation and the Plaintiff-firm avoids the same (para. 24 of the plaint). The reliefs claimed are: (a) declaration that the said contract was and is void, (b) the said contract be cancelled and/or adjudged void and the relevant Bought and Sold Notes be ordered to be delivered up and cancelled, (c) adjudication of the rights and liabilities of the parties, (d) injunction and (e) costs. 5. Learned Counsel for the Plaintiff-firm points out that the Plaintiff-firm's case as formulated in para. 22 of the plaint is that both the parties to the contract were under a mistake as to a matter of fact essential to the contract and consequently, the contract was and is void. The alternative case formulated in para. 5. Learned Counsel for the Plaintiff-firm points out that the Plaintiff-firm's case as formulated in para. 22 of the plaint is that both the parties to the contract were under a mistake as to a matter of fact essential to the contract and consequently, the contract was and is void. The alternative case formulated in para. 24 of the plaint is that the contract was induced by fraud and misrepresentation practised on the Plaintiff-firm and there-- fore, it was voidable at the instance of the Plaintiff-firm and the flatter has avoided it. In the first case there has been no contract ab initio and in the second case the contract has come to an end by being avoided by the Plaintiff-firm. In either case there is no valid subsisting contract and consequently there is no subsisting arbitration agreement. The Defendant-company denies all the contentions. Learned Counsel for the Plaintiff-firm contends that the Plaintiff-firm's case may be good, bad or indifferent, but it is entitled to a hearing. The trial Court will go into the merits of the case and decide the matter one way or the other, but the Court, on an application for stay, ought not to prejudge the issue but should proceed on the footing of the cage as formulated in paras. 22 and 24 of the plaint. I am unable to accept this extreme contention. u/s 34 of the Indian Arbitration Act the Court has to decide, as best as it can, whether the conditions for the applicability of the section have been fulfilled. The Court, before it can exercise its discretion to grant or refuse a stay, must make up its own mind, on the materials placed before it, as to the several matters mentioned in the section. One of those matters is whether the suit is in respect of matters agreed to be referred. This the Court will ascertain on a proper construction and reading of the plaint and in the light of the affidavits used in the application for stay. The Court will certainly not prejudge any issue but will, I apprehend, ascertain what the disputes are and then decide whether those disputes are to be left to the arbitrator or are to be heard and determined by the Court itself in the suit. The Court will certainly not prejudge any issue but will, I apprehend, ascertain what the disputes are and then decide whether those disputes are to be left to the arbitrator or are to be heard and determined by the Court itself in the suit. In this view, I am fortified by the opinion of Lord Porter in Heyman v. Darwins Limited (1942) A.C. 356, 393, where, after referring to certain earlier cases to which reference will be made hereafter, His Lordship observed: ...but this does not mean that in every instance in which it is claimed that the arbitrator has no jurisdiction the court will refuse to stay an action. If this were the ease such a claim would always defeat an agreement to submit disputes to arbitration, at any rate until the question of jurisdiction had been decided. The court to which an application to stay is made is put in possession of the facts and arguments and must in such a case make up its mind whether the arbitrator has jurisdiction or not as best as it can on the evidence before it. Indeed the application to stay gives an opportunity for putting these and other considerations before the court that it may determine whether the action shall be stayed or not. 6. What, then, do the allegations in the plaint, which I have summarised amount to? The gist of this part of the case is that both parties understood and believed that mesta was governed by the Jute (Price Control) Order and entered into the contract on that footing. The other allegations are only in the nature of particulars showing or explaining how this common belief came into existence. Why did the parties think that mesta was governed by that order? Because it was well known in the trade to be so governed. Why and how was it so known in the trade? Because the contract for mesta is made in contract forms headed "jute contract," taxes are deducted by buyers of mesta under the, Bengal Raw Jute Taxation Act, 1941, the Indian Jute Mills Association issued circulars clearly indicating that mesta was governed by that order and mesta transactions are performed and adjusted according to the interpretation of the said association. Because the contract for mesta is made in contract forms headed "jute contract," taxes are deducted by buyers of mesta under the, Bengal Raw Jute Taxation Act, 1941, the Indian Jute Mills Association issued circulars clearly indicating that mesta was governed by that order and mesta transactions are performed and adjusted according to the interpretation of the said association. Up to this point the allegations in the plaint only seek to support the case that for these reasons both parties thought that mesta was jute within the meaning of the Jute (Price Control) Order and they entered into the contract on this understanding and belief. I assume that this was so. I now pass on to the other allegations in the plaint. It is said that the Defendant-company is now contending that mesta is not jute and is not covered by that order, that it has wrongfully procured the Indian Jute Mills Association, of which it is an influential member, to issue fresh circulars to support its contentions and that it has wrongfully procured all the several influential associations other than the Bengal Jute Dealers' Association of which the Plaintiff-firm is a member, to express the same views at a joint meeting of the different associations. Assuming again that this is correct, what follows? These allegations are nothing more than assertions that the Defendant-company is wrongfully repudiating the assumption that was the very basis of the contract. But the repudiation by the Defendant-company alone will not avail if the basis exists in fact. Suppose the Plaintiff-firm had come to Court on the allegation that this particular contract was entered into on the basis of a well known trade usage and the Defendant-company denied the existence of that usage. Surely the Plaintiff-firm could not say that there was no contract. The pleading of a custom which is not inconsistent with the contract implies that the party pleading is seeking to incorporate the custom as an implied term in the contract and the denial of that custom means denial of that implied term and nothing more. I find it difficult to see that there is any difference between that case and the present one. In any event, I do not see where the mistake comes in at all on the above allegations. I assume both parties entered into the contract in the common belief that mesta was governed by that order. I find it difficult to see that there is any difference between that case and the present one. In any event, I do not see where the mistake comes in at all on the above allegations. I assume both parties entered into the contract in the common belief that mesta was governed by that order. The Plaintiff-firm is nowhere accepting the position that that belief was erroneous and that mesta is not governed by the order. All that he complains of is that the Defendant-company is now wrongfully contending that mesta is not jute within the meaning of that order. Where, then, is any mistake pleaded in the plaint? The conclusion in para. 22 of the plaint does not appear to me to be at all warranted by the facts as pleaded in the earlier paragraphs. 7. Learned Counsel for the Plaintiff-firm contends that the question whether mesta is governed by the Jute (Price Control) Order depends on the decision of the Court and if the Court decides that question in the negative, that decision will enable the Plaintiff-firm to take up the further plea that there was, on that finding, a mutual mistake. In other words, the Plaintiff-firm is entitled to take up two alternative positions. In the first place, the plea that mesta is jute within the meaning of that order is a defence to the Defendant-company's claim founded on the contract. If the Plaintiff-firm fails on that plea and the Court holds that mesta is not governed by that order, it will be still open to the Plaintiff-firm to contend, on that finding, that the contract was void having been entered into under a mutual mistake. In the first place, that is not the way the matter has been pleaded in the plaint. In the second place, the contention that mesta is jute, in so far as it is a defence to the Defendant-company's claim under the contract, is clearly for the arbitrators to decide. Finally, what will be the effect of the finding of the Court that mesta is not jute within that order? It will at best show that the common assumption was erroneous. What was the common assumption which will thus be rendered erroneous? It was that the Jute (Price Control) Order governed mesta. Was it a mistake of fact or of law? It will at best show that the common assumption was erroneous. What was the common assumption which will thus be rendered erroneous? It was that the Jute (Price Control) Order governed mesta. Was it a mistake of fact or of law? It seems to me that this mistake so pleaded stands on the same footing as that shown in the illustration to Section 21 of the Indian Contract Act and such a mistake, being a mistake of law, cannot, by reason of that section, make the contract voidable. From this aspect of the matter also, the position is that the case made in the plaint and as explained by Learned Counsel does not really raise the issue of the contract being void by reason of mutual mistake as to a matter of fact essential to the contract. 8. If I assume that the question of the applicability of a particular law to a particular case is one of fact, what will be the position? Is it such a mistake of fact as will make the contract void within the meaning of Section 20 of the Indian Contract Act? I have heard a long and interesting argument as to the nature and effect of a mistake on the formation of a contract. My attention has been drawn to Section 13 of the Contract Act which defines consent. It has been argued that there can be a contract only when the parties agree upon the same thing in the same sense. If there is no concensus ad idem no contract comes into being. I do not propose to enter into any elaborate discussion on the subject. Suffice it to say that the intention of the parties are to be ascertained from the acts and conduct of the parties at the time the contract was purported to be entered into. There can be no question that both parties intended to enter into a contract in respect of mesta, which is a well known commercial commodity, which is usually bought and sold under that name. So far there is no want of consensus ad idem. The question is whether there was any other misapprehension in the mind of one or both parties. ' On that question, the principles enunciated in the leading case of Bell v. Lever Brothers Limited (1932) A.C. 161, 218 appear, to me to be applicable. So far there is no want of consensus ad idem. The question is whether there was any other misapprehension in the mind of one or both parties. ' On that question, the principles enunciated in the leading case of Bell v. Lever Brothers Limited (1932) A.C. 161, 218 appear, to me to be applicable. As pointed out by Lord Atkin in that case the mistake may be in the identity of the contracting parties or in the existence of the subject-matter of the contract at the date of the contract or in the quality of the subject-matter of the contract. In the case before me there is no question of mistake as to the identity of the contracting parties or as to the existence of the subject-matter of the contract. The contract being for sale of unascertained goods and not of specific goods, the question of the non-existence, unknown to both parties, of the subject-matter at the date of the contract, does not arise. I have, therefore, to fall back on the last category, namely mistake as to the quality of the thing contracted for. Lord Atkin said: In such a case a mistake will not affect assent unless it is the mistake of both parties and is as to the existence of some quality which makes the thing without the quality essentially different from the thing as it was believed to be of course it may appear that the parties contracted that the article should possess the quality which one or other or both mistakenly believed it to possess. But in such a case there is a contract and the enquiry is a different one, being whether the contract as to quality amounts to a condition or a warranty, a different branch of the law. 9. His Lordship then referred to Kennedy v. Panama and Mail Company (1867) L.R. 2 Q.B. 580 where the contention was that shares in a company, which was believed to have had a concluded contract with the Government for carriage of mails, were entirely different in substance from shares in a company, which, in fact, as subsequently discovered, had no such contract and therefore, the contract was void. The Court came to the conclusion in that case, that, though there was a misapprehension as to that which was a material part of the motive inducing the Applicant to ask for the shares, it did not prevent the shares from being in substance those he applied for. His Lordship then referred to Smith v. Hughes (1871) L.R. 6 Q.B. 597 where Cockburn C.J. pointed out the fallacy of confounding what was merely a motive operating on the buyer to induce him to buy with one of the essential conditions of the contract. After referring to these cases Lord Atkin concluded: In these cases I am inclined to think that the true analysis is that there is a contract, but that one party is not able to supply the very thing, whether goods or services, that the other party contracted to take ; and therefore the contract is unenforceable by the one if executory, while if executed the other can recover back the money paid on the ground of failure of consideration. 10. In Lever Brothers case there was an agreement for payment of certain compensation to the Appellant for the termination of his contract of employment. The compensation was paid. It was discovered later on that the Appellant had been guilty of such misconduct as would have entitled the Respondent to terminate the contract of employment without payment of any compensation. At the date of the agreement for payment of compensation, the Respondent did not know of the breach and the Appellant had not in mind that he had committed any breach. The suit was filed by the Respondent for refund of the compensation-money paid, on the ground that the agreement for payment of compensation was void for mutual mistake. The argument was that an agreement to terminate a broken contract was quite different from an agreement to terminate an unbroken contract and that a contract immediately determinable is a different thing from a contract for an unexpired term and that the difference in kind was illustrated by the immense price of release from the longer contract as compared with the shorter. It was held by Lord Blanesburgh, Lord Atkin and Lord Thankerton (Viscount Hailsham and Lord Warrington of Clyffe dissenting) that the action failed, as to mutual mistake, on the ground that the mutual mistake related not to the subject matter, but to the Quality of the service contract. Lord Atkin said at p. 223: But, on the whole, I have come to the conclusion that it would be wrong to decide that an agreement to terminate a definite specified contract is void if it turns out that the agreement had already been broken and could have been terminated otherwise. The contract released is the identical contract in both cases and the party paying for release gets exactly what he bargains for. It seems immaterial that he could have got the same result in another way, or that if he had known the true facts he would not have entered into the bargain. 11. Applying these principles to the facts of the case before me, it seems to me that the mistake which is pleaded is a mistake not as to the subject-matter of the contract but as to the quality thereof. That mesta is a distinct well known commercial commodity which is commonly bought and sold in the market under that name is not disputed. The pleading comes to this, that the parties thought that mesta was governed by the Jute (Price Control) Order. Even if that order does not govern mesta, mesta does not cease to be mesta. If this contract were performed, the parties would have given or taken mesta, the very thing they contracted to give or take. In my opinion, the belief that mesta was covered by that order added only a quality or incident to mesta. Mesta which is not covered by that order is nevertheless mesta and therefore, there is no mistake as to the subject-matter of the contract. The mistake, if any, is as to the quality or incident which was erroneously imputed or attached to mesta. 12. Mesta which is not covered by that order is nevertheless mesta and therefore, there is no mistake as to the subject-matter of the contract. The mistake, if any, is as to the quality or incident which was erroneously imputed or attached to mesta. 12. Without going into the merits of the disputes between the parties, but merely on a construction of the plaint in the light of the affidavits used in this application, I have come to the conclusion : (i) that the Plaintiff firm has not raised a question of mistake at all, (ii) that the case of mistake, if any, is not one of fact but of law and (iii) that, in any event, the mistake of fact, if any, is not as to the subject-matter of the contract, but only as to the quality of the subject-matter of the contract. In this view of the matter, it cannot be said that the Plaintiff-firm has raised a case of, there being no contract at all. On a proper reading of the plaint, the case is that there was a contract and the only question is whether it is still bound by that contract. That will depend on whether the common assumption as to the quality was a condition or a mere warranty. If it was a condition the parties may avoid the contract and be released from performing it, but if it was only a warranty, then the parties cannot avoid the contract and must perform it. In either case it is not a case of no contract having been entered into or of the contract being void ab initio. 13. The alternative case of fraud and misrepresentation formulated in para. 24 of the plaint is sought to be supported by the facts also pleaded in the earlier paragraphs, namely, that the contract was headed "Jute contract," the words "mesta jute" were used in one place in the margin of the contract, that the Defendant-company's confirmation letter used the word "jute" and that the Defendant-company made representations that "mesta jute" was included in "jute" as used in the Jute (Price Control) Order. A contract induced by fraud or misrepresentation is, u/s 19 of the Contract Act, voidable at the option of the party whose consent to the contract was caused by such fraud or misrepresentation. A contract induced by fraud or misrepresentation is, u/s 19 of the Contract Act, voidable at the option of the party whose consent to the contract was caused by such fraud or misrepresentation. Here also, on the pleadings, therefore, it is not a case of there being no contract at all, but it is a case of a contract which has come to end by being avoided by the Plaintiff-firm in exercise of its option u/s 19 of the contract. 14. Having thus ascertained, as best as I can, the case made in the plaint, my next concern is to find out whether the subject-matter of the suit thus ascertained is covered by the arbitration agreement. This must ultimately depend on the scope and ambit of the arbitration agreement which must be ascertained on a proper construction of the language in which it has been couched. The question whether a particular dispute is or is not within the arbitration clause has frequently come up before Courts and certain principles are now well established. It will, therefore, be useful at this stage to refer to some of the important cases. 15. The case of Willesford v. Watson (1873) L.R. 8 Ch. App. 473, 477 was concerned with a very wide arbitration clause in a mining lease. The lessees sunk a shaft in a slanting direction into the adjoining land and made use of the shaft not only to work the mines within the lessor's land but also to bring materials and refuse from other lands in the lessor's land. The lessor objected to this unless a reasonable way leave was paid, The lessees having refused to make any payment, the lessors filed a bill to restrain the lessees from conveying any substance from the adjoining lands. The lessees applied for stay. The lessors contended, amongst other things, that the disputes were outside the submission and the Court should decide the disputes. In repelling this contention Lord Selborne L.C. said: It struck me throughout that the endeavour of the Appellants has been to require, this Court to do the very thing which the arbitrators ought to do--that is to say to look into the whole matter, to construe the instrument and to decide whether the thing which is complained of is inside or outside of the agreement. 16. 16. This passage, on a cursory reading, seems to suggest that it is for the arbitrators to decide whether a particular dispute is within their jurisdiction. But it will appear from the rest of the judgment that His Lordship took up the different parts of the lengthy arbitration clause and showed that the submission was, on a proper construction, so wide as to include all manner of disputes. Here the Court, being satisfied that the scope and ambit of the submission were large enough to cover the disputes that had arisen, stayed the suit. This case only shows that the arbitration-clause may be so worded as to invest power in the arbitrators to decide whether they have jurisdiction to decide any particular dispute. I do not read this decision as laying down any general proposition that in every case and irrespective of the language used in the submission the arbitrators can invest themselves with arbitral authority by deciding the question of their own jurisdiction in their own favour. 17. Monro v. Bognor Urban District Council (1915) 3 K.B. 167,170-1 also arose out of an application for stay. There the Plaintiff, a contractor, entered into a contract with the Defendants for the construction of certain sewerage works. The contract contained an arbitration-clause, the material part of which was as follows: If at any time any question, dispute or difference shall arise between the council or their engineer and the contractor upon or in relation to or in connection with the contract the matter shall be referred to and determined by the engineer.... 18. After doing certain works the contractor refused to complete the works alleging that he had been induced to enter into the contract by fraudulent representations made in the specification as to the nature of the soil. The contractor then brought this action to recover damages for the alleged misrepresentation and to have the contract declared void. The Defendants applied for stay. The Court of appeal reversed the decision of the Chamber Judge, who had, in agreement with the Master, ordered a stay. Pickford L.J., after analysing the statement of claim came to the following conclusions: It is, therefore, in no sense an action on the contract et all. Nor do I think that it is an action in relation to or in connection with the contract. Pickford L.J., after analysing the statement of claim came to the following conclusions: It is, therefore, in no sense an action on the contract et all. Nor do I think that it is an action in relation to or in connection with the contract. In one sense it is an action in relation to and in connection with the contract because if there had never been any contract there would never have been any cause of action, there would never have been any representation and there would never have been any claim for damages. But it is not in relation to or in connection with the contract, in my opinion within the meaning of the arbitration clause. Bankes L.J. concurred in a separate judgment. Learned Counsel for the Plaintiff-firm has sought to deduce a broad general proposition from this decision, namely, that if the contract is impeached on the ground of fraud or misrepresentation, the arbitration-clause contained therein cannot apply, for that perishes with the contract. I am unable to read this decision in that way. On the contrary, the learned Lord Justices treated the arbitration clause as subsisting and only decided that the disputes were not within the clause. This case, therefore, only decides that the language used in that arbitration clause was not wide enough to include the disputes which were the subject-matter of the suit. This decision does not say that the arbitration-clause may not be so widely worded as to cover a dispute of the kind that was raised in that action. Indeed the question was not considered from that point of view. 19. The appeal before the House of Lords in Produce Brokers Company Limited v. Olympia Oil and Cake Company Limited (1916) 1 A.C. 314 arose out of an application for setting aside an award. There, a commercial contract for sale of soya beans contained an arbitration-clause as follows: All disputes from time to time arising out of this contract including any question of law appearing in the proceedings shall be referred to arbitration according to the rules endorsed on this contract.... 20. The substantial question raised by the appeal was as to the competence of the arbitrators, under the above submission, to decide as to the existence of a custom affecting the rights and obligations of the parties under the contract. The House of Lords answered the question in the affirmative. 20. The substantial question raised by the appeal was as to the competence of the arbitrators, under the above submission, to decide as to the existence of a custom affecting the rights and obligations of the parties under the contract. The House of Lords answered the question in the affirmative. In course of his speech Earl Loreburn observed at p. 322: ...a court will decide for itself whether an inferior court has clothed itself with jurisdiction by an erroneous finding on something vital to the jurisdiction. 21. To the like effect were the views expressed by Lord Parker at p. 327: The binding force of an award must depend in every case on the submission. If the question which the arbitrator takes upon himself to decide is not in fact within the submission the award is a nullity. The arbitrator cannot make his award binding by holding contrary to the true facts that the question which he affects to determine is within the submission.... Where, however, the submission is, contained in the contract it may be a question of construction whether such expressions as "all disputes arising under this contract" include questions as to the ambit of the submission itself. Prima facie I do not think that they would, though it is unnecessary to decide the point. 22. The observations I have quoted above clearly indicate that the question whether the arbitrator has jurisdiction is one which depends on the terms of the submission as interpreted by the Court. If the question arises after the award is made, as on an application for setting aside the award or in a suit upon the award, the validity of the award will depend, inter alia, upon the decision of the Court on this question of jurisdiction of the arbitrators. If this question of jurisdiction arises before the award is made, as on an application for stay of suit, the question whether the suit will go on or be stayed will depend, inter alia, on the decision of the Court on this question In either case, if the question of the arbitrators jurisdiction is raised it will be for the Court to decide it. The last part of the observations of Lord Parker throws doubt on the observations of Lord Selborne, which I have quoted earlier, but Lord Parker's observations must be regarded as being applicable to a case where the language of the arbitration clause is "all disputes arising out of this contract." 23. In Hirji Mulji v. Cheong Yue Steamship Company Limited (1926) A.C. 497,502, 510-11 the Respondent company by a charter-party made in November, 1916, agreed to place their steamship at the disposal of the Appellants at Singapore on March 1, 1917 and the Appellants agreed to employ her on specified terms for ten months from the date she was delivered to them. The charter-party contained the following arbitration clause: That any dispute arising under this charter shall be referred to the arbitration of two persons in Hongkong, one to be nominated by the owners' agents and the other by the charterers and in case such arbitrators shall not agree, then to the decision of an umpire.... 24. The ship was requisitioned by the Government before March 1, 1917 and was not released until February, 1919. The Appellants then refused to take delivery of her. An arbitrator awarded the Respondents damages for breach of Contract and they brought an action upon the award. The Judicial Committee held that there had been in 1917 a frustration of the charter-party which forthwith brought to an end the whole contract, including the submission to arbitration and that consequently the contract being executory the arbitration had no jurisdiction. In course of delivering the judgment of the Board Lord Sumner at p. 502 made the following observations: As the arbitrator was the judge, if at all, both of law and fact, the sole question is whether he had any jurisdiction to decide, as he purported to do, between the parties. This depends on the question whether or not there was any submission and that again on the question whether, at the time, when it purported to be submitted to him, there was a dispute subsisting between the parties, "under this charter", that is a, contract then subsisting. That a person before whom a complaint is brought cannot invest himself with arbitral jurisdiction to decide it is plain. His authority depends on the existence of some submission to him by the parties of the subject-matter of the complaint. That a person before whom a complaint is brought cannot invest himself with arbitral jurisdiction to decide it is plain. His authority depends on the existence of some submission to him by the parties of the subject-matter of the complaint. For this purpose a contract that has determined is in the same position as one that has never been concluded at all. It founds no jurisdiction. 25. Their Lordships held that a frustration of the kind they were dealing with brings the contract to an end forthwith, without move and automatically and along with the contract the arbitration-clause which is part of it also comes to an end. Their Lordships, however, recognised that the arbitration-clause may be so worded that it will survive although the contract comes to an end. At p. 505 Lord Sumner said: The arbitration-clause is but part of the contract and unless it is couched in such terms as will except it out of the results, which follow from frustration, generally, it will come to an end too. This must be so, if the law is that the effect of frustration is the immediate termination of the contract as to all matters and disputes which have not already arisen. 26. Again at p. 510-511: Under these circumstances, by the year 1919, when a dispute first arose, "this charter" no longer existed. This dispute was not one, of which it could be predicated that it was one arising under "this charter", since that had terminated by frustration a year before. An arbitration-clause is not a phoenix, that can be raised again by one of the parties from the dead ashes of its former self. By its very terms, as well as by the fact that it was only one part of the indivisible charter, it had come to an end also; it is unnecessary to consider in what terms, if any, a clause might have been framed which would have saved the clause alive in the event of the frustration of the adventure and the charter. 27. The case of Heyman v. Darwins Limited (1942) A.C. 356 arose out of an application for stay of suit u/s 4 of the English Arbitration Act, 1889. 27. The case of Heyman v. Darwins Limited (1942) A.C. 356 arose out of an application for stay of suit u/s 4 of the English Arbitration Act, 1889. There the contract between the parties contained an arbitration clause in the following terms: If any dispute shall arise between the parties hereto in respect of this agreement or any of the provisions herein contained or anything arising hereout the same shall be referred for arbitration in accordance with the provisions of the Arbitration Act, 1889, or any then subsisting statutory modification thereof. 28. A dispute having arisen between the parties the. Appellants commenced an action against the Respondents claiming: (a) a declaration that the Respondents had "repudiated and/or evinced "an intention not to perform" the contract and (b) damages. The Respondents, who admitted the existence of the contract and denied that they had repudiated it, applied to have the action stayed in order that it might be dealt with under the arbitration-clause. The House of Lords held that the dispute fell within the terms of the arbitration clause and that the, action ought to be stayed. Viscount Simon L.C. at p. 366 said: ...while any opinion delivered by Lord Sumner must command the respect due to that great master of the law, I think the judgment in Hirji Mulji's case, (1) so far as the effect of frustration of contract on an arbitration-clause is concerned, must not be taken as having established a general rule. Ordinarily speaking, there seems no reason at all why a widely drawn arbitration-clause should not embrace a dispute whether a party is discharged from future performance by frustration, whether the time for performance has already arrived or not. 29. Further down His Lordship summarised what he conceived to be the correct view on the matter as follows: An arbitration clause is a written submission, agreed to by the parties to the contract, and like other written submissions to arbitration, must be construed according to its language and in the light of the circumstances in which it is made. If the dispute is whether the contract which contains the clause has ever been entered into at all, that issue cannot go to arbitration under the clause, for the party who denies that he has ever entered into the contract is thereby denying that he has ever joined in the submission. If the dispute is whether the contract which contains the clause has ever been entered into at all, that issue cannot go to arbitration under the clause, for the party who denies that he has ever entered into the contract is thereby denying that he has ever joined in the submission. Similarly, if one party to the alleged contract is contending that it is void ab initio (because, for example, the making of such a contract is illegal), the arbitration-clause cannot operate, for on this view the clause itself also is void. But, in a situation where the parties are at one in asserting that they entered into a binding contract, but a difference has arisen between them whether there has been a breach by one side or the other, or whether circumstances have arisen which have discharged one or both parties from further performance, such differences should be regarded as differences which have arisen "in respect of" or "with regard to" or "under" the contract and an arbitration clause which uses these, or similar, expressions should be construed accordingly. 30. As pointed out at p. 368, His Lordship did not consider it necessary to deal with the difficult question tentatively negatived by Lord Parker, namely, whether the words "all disputes arising "under this contract" occurring in arbitration-clause cover a dispute as to the ambit of the submission. Lord Macmillan, however, at p. 370 said: Arbitration-clauses in contracts vary widely in their language for there is no limitation on the liberty of contracting parties to define as they please the matters which they desire to submit to arbitration. Sometimes the reference is confined to practical questions arising in the course of the execution of the contract; sometimes the most ample language is used so as to embrace any question which may arise between the parties in any way relating to the contract. 31. Then His Lordship proceeded as follows: I may clear the ground by disposing of one or two simple cases. If it appears that the dispute is whether there has ever been a binding contract between the parties, such a dispute cannot be covered by an arbitration-clause in the challenged contract. If there has never been a contract at all, there has never been as part of it an agreement to arbitrate. The greater includes the less. If it appears that the dispute is whether there has ever been a binding contract between the parties, such a dispute cannot be covered by an arbitration-clause in the challenged contract. If there has never been a contract at all, there has never been as part of it an agreement to arbitrate. The greater includes the less. Further, a claim to set aside a contract on such grounds as fraud, duress or essential error cannot be the subject matter of a reference under an arbitration-clause in the contract sought to be set aside. Again, an admittedly binding contract containing a general arbitration clause may stipulate that in certain events the contract shall come to an end. If a question arises whether the contract has for any such reason come to an end I can see no reason why the arbitrator should not decide that question. It is clear, too, that the parties to a contract may agree to bring it to an end to all intents and purposes and to treat it as if it had never existed. In such a case, if there be an arbitration clause in the contract, it perishes with the contract. If the parties substitute a new contract for the contract which they have abrogated the arbitration clause in the abrogated contract cannot be invoked for the determination of questions under the new agreement. All this is more or less elementary. 32. In the light of the observations made by Lord Wright and Lord Porter, to which I shall presently refer, it appears to me that Lord Macmillan in the above passage had in his mind an ordinary arbitration-clause such as one usually finds in a commercial contract and not an arbitration-clause designedly widely worded. In the earlier passage from his speech also quoted above Lord Macmillan recognised that there was no limitation on the liberty of the parties to include any dispute in the submission. Lord Wright at p. 377 observed: A submission may, however, take many different forms. It may be a special agreement to arbitrate on a particular dispute which has already arisen on some matter, such as contract, tort, trust or family arrangement.... That illustrates clearly one aspect of an arbitration agreement, namely, that it is collateral to the substantial stipulations of the contract. It may be a special agreement to arbitrate on a particular dispute which has already arisen on some matter, such as contract, tort, trust or family arrangement.... That illustrates clearly one aspect of an arbitration agreement, namely, that it is collateral to the substantial stipulations of the contract. It is merely procedural and ancillary, it is a mode of settling disputes, though the agreement to do so is itself subject to the discretion of the court. All this may be said of every agreement to arbitrate, even though not a separate bargain, but one incorporated in the general contract.... Again, the illustration I have given shows that there may be an agreement to arbitrate on a question on a contract which has on one view ceased to exist, at least as to future performance, though whether it has ceased to exist or not is disputed, or, if that is not disputed, the question of damages remains in dispute. It must depend on the construction of the collateral agreement contained in the arbitration clause, whether that agreement survives and can be insisted on for the settlement of these disputes. 33. Lord Wright continued as follows at p. 378: Repudiation of a contract is sometimes used as meaning that the Defendant denies that there ever was a contract in the sense of an actual consensus ad idem. If that is the case, a submission of disputes under the contract never comes into operative existence any more than the contract to which it was to be ancillary. Short of this, one party, though not denying that there was the appearance of assent, might claim that the consent was vitiated by fraud or duress or mistake or illegality and in that sense it is often said that he repudiates the contract. There, again, it would be a question of construction whether the collateral arbitration clause could be treated as severable and could be invoked for settling such a dispute. There is, however, a form of repudiation where the party who repudiates does not deny that a contract was intended between the parties, but claims that it is not binding because of the failure of some condition or the infringement of some duty fundamental to the enforceability of the contract, it being expressly provided by the contract that the failure of condition or the breach of duty should invalidate the contract. A dispute on such an issue would generally be within an ordinary submission of disputes under or arising out of the contract or similar words, though the award in a certain event might have the effect of declaring that the contract had ceased to be or even had never become, binding. 34. To the same effect are the following observations of Lord Wright at p. 384: Nor are the Appellants helped by the rule that, generally speaking, a dispute whether the contract ever existed, as contrasted with the question whether it has been ended, is not within the usual form of submission of differences arising out of the contract or the like, because, if there was never a contract at all, there could never be disputes arising out of it. Ex nihilo nil fit. It is all a question of the scope of the submission. Hence, if the question is whether the alleged contract was void for illegality, or, being voidable, was avoided because induced by fraud or misrepresentation, or on the ground of mistake, it depends on the terms of the submission whether the dispute falls within the arbitrator's jurisdiction. 35. At p. 385 Lord Wright finally concluded: I see no objection to a submission of the question whether there ever was a contract at all, or Whether if there was, it had been avoided or ended. Parties may submit to arbitration any or almost any question. 36. Lord Porter expressed his opinion in the following passage of his speech at p. 392: Meanwhile, I think it essential to remember that the question whether a given dispute comes within the provisions of an arbitration-clause or not primarily depends on the terms of the clause itself. If two parties purport to enter into a contract and a dispute arises whether they have done so or not, or whether the alleged contract is binding on them, I see ho reason why they should not submit that dispute to arbitration. Equally I see no reason why, if at the time when they purport to make the contract they foresee the possibility of such a dispute arising, they should not provide in the contract itself for the submission to arbitration of a dispute whether the contract ever bound them or continues to do so. Equally I see no reason why, if at the time when they purport to make the contract they foresee the possibility of such a dispute arising, they should not provide in the contract itself for the submission to arbitration of a dispute whether the contract ever bound them or continues to do so. They might, for instance, stipulate that, if a dispute should arise whether there had been such fraud, misrepresentation or concealment in the negotiations between them as to make an apparent contract voidable, that dispute should be submitted to arbitration. It may require very clear language to effect this result and it may be true to say that such a contract is really collateral to the agreement supposed to have been made, but I do not see why it should not be done. 37. His Lordship then referred to the observations of Lord Sumner in Hirji Mulji's case (supra) as showing that Lord Sumner also had visualised the possibility of providing for such an arbitration. 38. The principles deducible from the authorities I have quoted above may be summarised as follows: (i) An arbitrator cannot make his award binding by holding, contrary to the true facts, that the question which he affects to determine is within the submission. In other words, an arbitrator cannot invest himself with arbitral jurisdiction. (ii) The question of the arbitrator's jurisdiction, whether it arises before the award is made, e.g., on an application for stay of an action, or after the award is made, e.g., on an application for setting aside the award or in an action upon the award, is one for the Court to decide. (iii) The question whether a particular dispute is or is not within the jurisdiction of the arbitrator ultimately depends for its answer on a true interpretation of the arbitration agreement. (iv) Where the dispute is whether the contract which contains an usual arbitration clause had ever been entered into at all, that issue cannot go to arbitration under that clause. (v) If the dispute is whether the contract was void ab initio, e.g., for illegality the arbitration clause contained therein cannot operate. (vi) If the dispute is whether the contract was void ab initio, e.g., for mutual mistake as to a matter of fact essential to the contract, an ordinary arbitration clause contained therein cannot be availed of. (v) If the dispute is whether the contract was void ab initio, e.g., for illegality the arbitration clause contained therein cannot operate. (vi) If the dispute is whether the contract was void ab initio, e.g., for mutual mistake as to a matter of fact essential to the contract, an ordinary arbitration clause contained therein cannot be availed of. (vii) Where the parties are at one in asserting that they entered into a binding contract, but the dispute is whether the contract has come to an end, e.g., by frustration, then, according to the judicial committee, the arbitration clause contained therein, unless it is expressed in such terms as will except it out of the results flowing from frustration, will not be available. (viii) Where the parties are at one in asserting that they entered into a binding contract, but the dispute is whether there has been a breach by one side or the other or whether circumstances have arisen which have discharged one or both parties from further performance, such disputes, according to the House of Lords, should be regarded as disputes arising "in respect of" or "with regard to" or "under" the contract. (ix) The arbitration-clause may be concluded in such language as to indicate that it is a separate and collateral contract, which does not depend, for its existence of validity, on the existence or validity of the main contract, so that, although the main contract never came into being, e.g., for want of consensus ad idem, or illegality or mutual mistake or having come into being may have come to an end by frustration or rescission or by being avoided for fraud, misrepresentation or duress the collateral arbitration agreement will still survive. 39. I have already held that the case made by the Plaintiff-firm is that the contract in question was entered into under a common mistake as to the quality of the subject matter of the Court. This case means that a contract came into existence. The question whether a party is discharged from performance of the contract depends on whether the erroneous assumption constitutes a condition or warranty. At best, it is a case that the party has been discharged from his obligations under the contract by reason of the non-fulfillment of the condition. The alternative case is that the contract was induced by fraud or misrepresentation. At best, it is a case that the party has been discharged from his obligations under the contract by reason of the non-fulfillment of the condition. The alternative case is that the contract was induced by fraud or misrepresentation. This case also implies that a contract came into existence, but has come to an end by being avoided by the Plaintiff-firm. The question is, in either case, whether the arbitration clause has also perished with the contract. The answer, as I have said, depends on the true construction of the arbitration clause. 40. The arbitration clause contained in the contract is in the following terms: All matters, questions, disputes, differences and/or claims arising out of and/or concerning and/or in connection with and/or in consequence of or relating to this contract whether or not the obligations of either or both parties under this contract be subsisting at the time of such dispute and whether or not this contract has been terminated or purported to be terminated or completed shall be referred to the arbitration of the Bengal Chamber of Commerce under the rules of its Tribunal of Arbitration for the time in force and according to such rules the arbitration shall be conducted. 41. A wider arbitration clause it is difficult to find in commercial contracts. It comprises and covers all manner of questions and disputes "arising out of" or "concerning" or "in connection "with" or "in consequence of" or "relating to" the, contract. In its scope and ambit there is no limit except that it contemplates a contract. If a contract was never entered into, because, for example, the parties were not ad idem or the contract was void ah initio, e.g., by reason of illegality or mutual mistake of fact essential to the contract, this clause will not be available, for there being no contract there can be no dispute arising out of it. If a contract was never entered into, because, for example, the parties were not ad idem or the contract was void ah initio, e.g., by reason of illegality or mutual mistake of fact essential to the contract, this clause will not be available, for there being no contract there can be no dispute arising out of it. But if once it is found that there was a contract, then, although the contract may have come to an end by reason of frustration or rescission or breach of condition or by being avoided for fraud or misrepresentation or coercion, this arbitration clause clearly survives, for it is, by its language, kept operative "whether or "not the obligations of either or both parties under this contract "be subsisting at the time of such dispute" and "whether or not "this contract has" been terminated or purported to be terminated "or completed." A contract induced by fraud or misrepresentation comes into being and exists until it is avoided. Upon avoidance or termination, the obligation of the parties under the contract may not subsist, but this arbitration clause, by its language, is expected out of the results of such avoidance or termination. It appears to me that this arbitration clause is very much wider in scope and import than an ordinary arbitration clause which is usually attached to commercial contracts and which was used in the contracts which were the subject-matter of Hirji Mjdji's case and other cases I have mentioned. This clause is so expressed that it, in my opinion, constitutes an arbitration clause which is collateral to or even independent of the substantive stipulations of the contract. The substantive commercial contract and this arbitration agreement are, as it were, separate contracts rolled into one and set forth in one document for the sake of convenience. In Balabux Agarwalla's case ILR (1948) 1 Cal. 265. I have already held that this arbitration clause survived, even though the contract came to an end by reason of frustration. In my judgment, even if the substantive contract came to an end by reason of being avoided for fraud or misrepresentation or for breach of condition, this arbitration clause still survives and may well be invoked. I have already indicated what the subject-matter of the suit as pleaded is. In my judgment, even if the substantive contract came to an end by reason of being avoided for fraud or misrepresentation or for breach of condition, this arbitration clause still survives and may well be invoked. I have already indicated what the subject-matter of the suit as pleaded is. In my opinion, this suit is in respect of matters agreed to be referred and the primary condition of Section 34 of the Indian (Arbitration Act has been fulfilled. 42. It is not alleged that the Defendant-company has taken any step in the proceedings or was not at the time the suit was commenced ready or willing to do all things necessary to refer the matter to arbitration. The only remaining question is whether there is any sufficient reason why the matter should not be referred. Said Lord Wright in Heyman v. Darwins Limited (1942) A.C. 356, 388: Though the dispute is clearly within the arbitration-clause, the Court "may" still refuse to stay if, on the whole, that appears to be the better course. But the court must be satisfied on good grounds that it ought not to stay. The onus of thus satisfying the court is on the person opposing the stay, because in a sense he is seeking to get out of his contract to refer, though in truth an arbitration-clause is not of strict obligation, because it is, u/s 4, always subject to the discretion of the court. 43. The primary onus is on the Applicant for stay to satisfy the Court that the preliminary conditions prescribed by the section have been complied with. If that onus is discharged then the onus shifts on to the party opposing the stay to satisfy the Court that there is sufficient reason why the matter should not be referred. If the preliminary conditions are satisfied the Court will generally lean in favour of a stay and if I may borrow the felicitous expressions of Mitter J. in Ladha Singh Bedi v. Kalyani Prasad Singh Deo ILR (1939) 2 Cal. 181, 195, "force by an indirect method a "contumacious party who had agreed to arbitration to go to "arbitration." 44. If the preliminary conditions are satisfied the Court will generally lean in favour of a stay and if I may borrow the felicitous expressions of Mitter J. in Ladha Singh Bedi v. Kalyani Prasad Singh Deo ILR (1939) 2 Cal. 181, 195, "force by an indirect method a "contumacious party who had agreed to arbitration to go to "arbitration." 44. The Plaintiff-firm seeks to discharge the onus and establish a sufficient reason for refusing the stay in this way: In spite of its previous circulars that mesta was jute within the meaning of the jute (Price Control) Order, the Indian Jute Mills Association, of which the Defendant-company is a member, on January 7, 1947, while the arbitration was pending before the Tribunal of Arbitration, issued a circular stating or deciding that mesta was not included in that Order. There was a meeting of the representatives of five associations interested in the jute trade on January 17, 1947, when the representatives of all the associations other than the Bengal Jute Dealers' Association, of which the Plaintiff-firm is a member, expressed the views of their respective associations to the effect that mesta did not come under that order. The Calcutta Baled Jute Association has also come to a similar decision. Mr. M.P. Birla of the Defendant-company is an influential member of the Indian Jute Mills Association and one of the representatives of Birla Brothers, the managing agents of the Defendant-company, is also a member of the Calcutta Baited Jute (Association. The decisions of the two associations have been arrived at and procured by the buyers in whose interest those associations work. All the members of the Bengal Chamber of Commerce are member's of one or other of the several associations mentioned. In the premises, the arbitrators appointed by Bengal Chamber of Commerce are incompetent to try the case, because they would not be entitled to go against the mandate of their respective associations. Mr. B. Kanoria, a representative of the Birla concerns, is a member of the Calcutta ; Baled Jute Association and was a member of the committee of that association which decided that mesta was not jute. In this very arbitration, the Registrar, Bengal Chamber of Commerce, has appointed two arbitrators, namely Mr. Arcot, who is a member of the Indian Jute Mills Association and Mr. Ferguson, who is a member of the Calcutta Jute Dealers' Association. Mr. In this very arbitration, the Registrar, Bengal Chamber of Commerce, has appointed two arbitrators, namely Mr. Arcot, who is a member of the Indian Jute Mills Association and Mr. Ferguson, who is a member of the Calcutta Jute Dealers' Association. Mr. Ferguson-was also a member of the committee of the last mentioned association, which unanimously decided that mesta was not jute. The majority of members of the Bengal Chamber of Commerce, who are likely to act as arbitrators, are buyers and the interest of the majority of such members as buyers is in conflict with the interest of the sellers and they cannot be expected to deal with the matter fairly and impartially. At the time when the contract was made, it never knew that a situation like this would arise, when the buyers as a class would be arranged on one side and the sellers as a class on the other. Almost all of the arbitrators named in the panel of arbitrators for the current year are said to be buyers. 45. Some of the above allegations are denied in the affidavit in reply. It is denied that the majority of the arbitrators are buyers or that any mandate has been issued or that the arbitrators would be bound thereby. It is denied that the Indian Jute Mills Association or the Calcutta Jute Dealers' Association control the Bengal Chamber of Commerce. As to allegations concerning Mr. Arcot and Mr. Ferguson the same are dealt with in para. 8 of the reply. These allegations are not admitted. It is denied that Mr. Ferguson took any part in the decision of his committee. Paragraph 8 of the reply is verified as based on information derived from the records kept at the office of the Defendant-company. This verification does not appear to be in order at all. It is denied that the majority of the members, who are likely to be appointed as arbitrators, are buyers. The Bengal Chamber of Commerce is said to be an independent body and its tribunal does not appoint a person as arbitrator who has any interest in the subject-matter of the dispute. 46. Similar contentions were raised before me in Balabux's case (supra) which was concerned with a contract for sale of jute. The Bengal Chamber of Commerce is said to be an independent body and its tribunal does not appoint a person as arbitrator who has any interest in the subject-matter of the dispute. 46. Similar contentions were raised before me in Balabux's case (supra) which was concerned with a contract for sale of jute. In that case I said: It is not out of bounds of possibility that a situation may sometimes arise in a trade which will divide persons engaged therein into opposite groups and if such a situation does arise the Court will certainly take that into consideration. 47. In that case, however, the allegations had not been properly verified and as such could not be acted upon by the Court and the suit was stayed. In the present case, however, the allegations are properly verified and cannot be rejected off-hand. The allegations are denied, it is true, but it is quite clear on the evidence before me in this case that there has been a sharp cleavage of interest and accordingly, of opinion between the members of four important associations on one side and the members of the fifth, namely the Bengal Jute Dealers' Association on the other side: The minutes of the proceedings of the joint meeting of the representatives of the five associations make that quite clear. Further the fact remains practically uncontradicted, for the denial thereof is not properly verified, that the two arbitrators appointed in this very case are members of two associations which have declared their opinion that mesta is not governed by the Jute (Price Control) Order and that one of them is a member of the committee of his association which has so declared its opinion. 48. That a mere expression of opinion by the arbitrator does not necessarily imply a prejudgment of the question has been laid down by Blackburn J. in Hutchinson v. Hayward (1866) 15 L.T. 291 and by other cases referred to in Hogg on Arbitration at p. 72. It is true that the parties entered into the contract and agreed to refer their disputes to the Tribunal of Arbitration, Bengal Chamber of Commerce and should ordinarily be held to their contract. Possibly the Plaintiff-firm knew or should have known that the Bengal Chamber of Commerce was to a certain extent dominated by the four associations. It is true that the parties entered into the contract and agreed to refer their disputes to the Tribunal of Arbitration, Bengal Chamber of Commerce and should ordinarily be held to their contract. Possibly the Plaintiff-firm knew or should have known that the Bengal Chamber of Commerce was to a certain extent dominated by the four associations. It may also be that the opinion of a particular association may not necessarily coincide with that of a particular member thereof. Further, opinion once expressed may on further consideration be changed. But the question before me is whether, in the events that have happened and which I have detailed above, the Court should, in exercise of its discretion, hold the Plaintiff-firm to its bargain and compel it to go to arbitration, when there is some apprehension of probable bias of the arbitrators against his case. 49. In early times the Courts in England looked upon agreements to refer disputes to arbitration with a good deal of suspicion and disfavour. At common law the authority of an arbitrator might, at any time before the award, have been revoked at the will and pleasure of any party to the submission. Indeed the power of revocation was regarded as inherent or implied in any arbitration agreement. This was naturally inconvenient from the point of view of trade and commerce and statutory provisions had to be made from time to time for facilitating arbitration. It is not necessary for me to trace the growth of the law of arbitration in England from 1698 to 1889. The Arbitration. Act of 1889 having left the question of stay of proceedings to the discretion of the Court there remained no longer any question of ouster of jurisdiction of the King's Court by private tribunals and the Courts in England began to take a more benevolent view of arbitration agreements. Further, the exigencies of trade and commerce required speedy settlement of disputes and arbitration out of Court was found satisfactory and less expensive. Gradually the Courts began to encourage arbitration out of Court and to compel contumacious parties, who tried to back out of their arbitration agreement and came to Court, to go to arbitration by directing a stay of the legal proceedings commenced by him in contravention of his agreement and thereby to give effect to the' agreement of the parties. Gradually the Courts began to encourage arbitration out of Court and to compel contumacious parties, who tried to back out of their arbitration agreement and came to Court, to go to arbitration by directing a stay of the legal proceedings commenced by him in contravention of his agreement and thereby to give effect to the' agreement of the parties. This swinging back of the pendulum gathered momentum and reached its height in the decisions of the English Court of appeal, which, by staying proceedings indirectly, enforced the arbitration clauses in building contracts and compelled the contractor to refer disputes arising out of such contracts to the very engineer, architect or surveyor employed by the owners or undertakers to supervise the works of the contractor. I examined those decisions at some length in my judgment on the application for stay of Suit No. 200 of 1947 Dwarkadas Company v. Keshardeo Babua ILR (1948) 1 Cal. 190 which related to bullion transactions and it will be enough, without repeating in detail what I stated there, to only give the references here, namely, Nuttal v. Mayor etc. of Manchester (1892) 8 T.L.R. 513; Jockson v. Barry Railway Company (1893) 1 Ch. 238; Eckersby v. Mersey Docks and Harbour Board (1894) 2 Q.B. 667; Ives and Barker v. Willans (1894) 2 Ch. 478; Cross v. Leeds Corporation (1902) Hudson on Building Contracts, Vol. II, p. 339; Robert W. Blackwell and Company, Ltd. v. Derby Corporation (1909) 75 J.P. 129; G. Freeman and Sons v. Chester Rural District Council (1911) 1 K.B. 783; M'Kee v. Mayor and Corporation of Dublin (1912) Hudson on Building Contracts, Vol. II, p. 466. As I ventured to point out on that occasion, the decisions of the English Court of appeal laid down certain principles as to how the discretion of the Court should be exercised in the matter of granting or refusing a stay of proceedings instituted in contravention of arbitration clause in a building contract. Those decisions recognised that the Court had a discretion in the matter but laid greater emphasis on the sanctity of contracts entered into with full knowledge of facts and held parties to their contracts except in most extreme cases. Those decisions recognised that the Court had a discretion in the matter but laid greater emphasis on the sanctity of contracts entered into with full knowledge of facts and held parties to their contracts except in most extreme cases. Subject to these extreme exceptions, the principle of sanctity of contract was so strongly and robustly expressed in those cases dealing with building contracts that those decisions came to be regarded as laying down some sort of positive limitation on the exercise of discretion under the Arbitration Act. The sanctity of contract overshadowed the discretion of the Court. Then came two decisions of the House of Lords which restored the equilibrium and laid more emphasis on the discretion of the Court than on the sanctity of contract. 50. The case of Hickman and Company v. Roberts (1913) A.C. 229, 239 did not turn on Section 4 of the English Arbitration Act but was concerned with a building contract and the observations of the learned law lords throw considerable light on the question now before me. There the contract provided that the decision of the architect on all matters relating to the work would be final and payment would be made on his certificate. The architect, under a misapprehension, allowed his judgment to be influenced by the building owners and delayed issuing his certificate. The contractor commenced his action. The trial Court (Hamilton J,) held that by delaying the issuing of the certificate the architect had failed in duty but exonerated him from the suggestion of corrupt conduct. It was also held that the contractor by asking for further certificate after full knowledge of the breach of duty by the architect elected to treat him as the person by whose decision he was bound and as there was no certificate the action was dismissed. This decision was reversed by the Court of appeal. The Defendant appealed to the House of Lords, but the latter upheld the decision of the appeal Court. Lord Loreburn L.C. agreed with the observations of Fletcher Moulton L.J. in the Court below that the architect was no longer fit to be a judge because he had been acting in the interest of the owners. Lord Ashbourne agreed that the arbitrator did not preserve that attitude of judicial independence which was needed and required of him. Lord Loreburn L.C. agreed with the observations of Fletcher Moulton L.J. in the Court below that the architect was no longer fit to be a judge because he had been acting in the interest of the owners. Lord Ashbourne agreed that the arbitrator did not preserve that attitude of judicial independence which was needed and required of him. Lord Alverstone said that it was to be clearly understood that when a contractor puts himself in the hands of an engineer or architect as arbitrator there is a very high duty on the part of that engineer or architect to maintain his judicial position. Lord Atkinson was of opinion that the arbitrator in that case had ceased to be a free agent, that he forfeited his independence and allowed himself to be under the control or under the influence of the building owners. Lord Shaw opened his speech with the following observation: My Lords, the position of an architect in a building contract is one of great delicacy. He is placed in that position to act judicially, when, to the knowledge, of both parties, the person who is his master and his paymaster is one of the parties to the contract. It has been affirmed by courts of law, however, that that being the case his judicial position must be accepted and it follow from this that in the peculiar delicate situation in which such a man stands the courts of law must be particular to see that his judicial attitude is maintained. 51. The case of Bristol Corporation v. John Aird and Company (1913) A.C. 241, 252, 257 arose out of an application for stay. The observations made by the different learned law lords on the discretionary powers of the Court are clearer and more emphatic than in the previous case. 51. The case of Bristol Corporation v. John Aird and Company (1913) A.C. 241, 252, 257 arose out of an application for stay. The observations made by the different learned law lords on the discretionary powers of the Court are clearer and more emphatic than in the previous case. Lord Atkinson, after pointing out that if a contractor chooses to enter into such a contract he should be held to his contract, went on to say: But though the contractor is bound by that contract, still he has a right to demand that, notwithstanding those pre-formed views of the engineer that gentleman shall listen to argument and determine the matter submitted to him as fairly as he can as an honest man; and if it be shown in fact that there is any reasonable prospect that he will be so biassed as to be likely not to decide fairly upon those matters, then the contractor is allowed to escape from his bargain and to have the matters in dispute tried by one of the ordinary tribunals of the land. But I think he has more than that right. If, without any fault of his own, the engineer has put himself in such a position that it is not fitting or decorous or proper that he should act as arbitrator in any one or more of those disputes, the contractor has the right to appeal to a Court of law and they are entitled to say, in answer to an application to the Court to exercise the discretion which the 4th section of the Arbitration Act vests in them, "We are not satisfied that there is not some reason for not submitting this question to the arbitrator. In the present case the question is, Has that taken place?" 52. On an analysis of the facts His Lordship held that it had taken place. Lord Shaw referred to his opinion expressed in Hickman and Company v. Roberts (supra) and after stating that the parties stand bound by their contract proceeded as follows: Prima facie, a judge ought to be entirely apart from the subject-matter upon which he adjudicates ; prima facie, in a contract of the kind I have sketched, he is the very opposite of what he ought to be. But, my Lords, the law is now settled in the sense I have mentioned and I turn with satisfaction to the action of the Legislature, which, I think, affords an opening for relief. By Section 4 of the Arbitration Act, 1889, where proceedings on a contract containing an arbitration clause are taken, the Court, if satisfied that there is no sufficient reason why the matter should not be referred, may make an order staying the proceedings. Upon that it is open to the Court always to affirm that upon the whole there does appear to be sufficient reason why the matter should not be referred. 53. Lord Moulton after tracing the growth of the law of arbitration made the following observations: But, my Lords, it must be remembered that these arbitration-clauses must be taken to have been inserted with due regard to the existing law of the land and the law of the land applicable to them is, as I have said, that it does not prevent the parties coming to the Court, but only gives to the Court the power to refuse its assistance in proper case's. Therefore to say that if we refuse to stay an action we are not carrying out the bargain between the parties does not fairly describe the position. We are carrying out the bargain between the parties, because that bargain to substitute for the Courts of the land a domestic tribunal was a bargain into which was written, by reason of the existing legislation, the condition that it should only be enforced if the Court thought it a proper case for its being so enforced. 54. Further down, after stating that the Court should start with an earnest desire to keep the parties to the domestic tribunal, His Lordship said at p. 258: But, on the other hand, I do not think that the Legislature has ever made it incumbent on a Court to drive a man to a tribunal which would probably be unfair, however much he may have bound himself to accept it and therefore the Court must ask itself whether it is fair for this man to be refused the assistance of the Court in settling his dispute. But the Court must always remember that the parties themselves are estopped from saying that the tribunal in its constitution is unfair, because it is the one which they accepted as the basis of the contract. 55. Lord Parker, after pointing out that the Arbitration Act gave a discretion to the Court, expressed the following opinion: In making up its mind on this point the Court must of course (sic) consideration to the contract between the parties; but it should, I think, always be remembered that the parties may have agreed to the submission precisely because of the discretionary power vested in the Court under the Arbitration Act. They may very well, for instance, have said to themselves, "If in any particular case it would be unfair to allow the arbitration we are agreeing to to proceed we shall have the protection of the Court." 56. These two cases considerably helped in mitigating the rigours of the decisions of the Court of appeal based on the principle of sanctity of contract and in restoring the discretionary powers of the Court. The legislature in England in 1934 gave further relief to parties bound by arbitration agreements by enacting Section 14 of the Amending Act of 1934. In the light of these principles, the question I have to consider is whether, in the events that have happened, it will be fair to drive the Plaintiff-firm to a tribunal both the members of which are members of associations which have expressed some definite views on the question in controversy. There is, to my mind, considerable justification for the apprehension expressed by the Plaintiff-firm of probable bias of the arbitrators. I do not question the honesty and integrity of the two arbitrators, but, in the circumstances appearing in the evidence before me, it will be unfair alike to them and to the Plaintiff-firm to put them in a position of conflict with their own associations. On the whole I have come to the conclusion that this is a case where circumstances exist which are calculated to bias the minds of the arbitrators and where the Plaintiff-firm may legitimately ask the Court to release it from its bargain to go to arbitration. On the whole I have come to the conclusion that this is a case where circumstances exist which are calculated to bias the minds of the arbitrators and where the Plaintiff-firm may legitimately ask the Court to release it from its bargain to go to arbitration. In coming to this conclusion, I have also been to a certain extent influenced by the fact that Rule V(3) of the Bengal Chamber of Commerce may prevent the Plaintiff-firm from challenging the award, after one is made, on the ground that the two arbitrators who have been appointed should not have been so appointed. In the circumstances proved in this case Lam satisfied that there is sufficient reason why the matter should not be referred and accordingly I dismiss this application with costs.