Judgment Sen, J. An application under section 34 of the Indian Arbitration Act for stay at further proceedings of the suit, being Title Suit No. 25 of 1980, of the 1st Court of the learned Subordinate Judge at Alipore having been dismissed by the learned Judge by an order dated June 16, 1980, the defendant-petitioner has preferred the present appeal challenging the said order. The appeal involves a very short point which, in our view, is no longer res integra. 2. The plaintiff admittedly entered into an agreement with the defendant on June 4, 1979. This agreement incorporates an arbitration clause, being No. 8, to the effect that "All disputes and differences between the parties regarding the interpretation of this Agreement or any of the terms and conditions contained or determination of any liability or any other disputes whatsoever shall be referred to the Arbitration in accordance with the Indian Arbitration Act, 1940 or any statutory modification or enactment thereunder". 3. In instituting the above suit the plaintiff pleaded that though described as an agreement, it was really a lease for more than one year and yet, it was not registered and as such is invalid and void the plaintiff further pleaded that the agreement is void on the ground of fraud, misrepresentation and undue influence practised by the defendant upon the plaintiff. On these allegations the plaintiff sought for a declaration that the aforesaid agreement is void or voidable and as such, is not binding upon the plaintiff with other consequential and alternative reliefs. 4. Summons of such a suit being served upon the defendant, the defendant appeared and filed the application under section 34 of the Arbitration Act, out of which the present appeal arises, praying for stay of the suit on the plea that the dispute between the parties must go to arbitration in view of the arbitration agreement incorporated in the agreement itself. The learned Subordinate Judge overruled the said plea raised by the defendant and dismissed the application on the view that the subject-matter of the suit is the agreement and not interpretation of the agreement or in respect of any terms and conditions or determination of any liability or any other dispute arising out of the agreement and as such, the prayer made under section 34 of the Act is not sustainable. Feeling aggrieved, the defendant has preferred the present appeal. 5.
Feeling aggrieved, the defendant has preferred the present appeal. 5. The learned Advocate appearing in support of this appeal has contended that, in view of the wide terms of the arbitration clause, the dispute raised in the suit should have been held to be covered by the arbitration clause so that the defendant is entitled to claim stay of further proceedings of the suit to enable the parties to refer the matter to arbitration. Such a contention has been strongly contested by the learned Advocate for the respondent. 6. Having heard the learned Advocates and considering the position in law, we feel no hesitation in agreeing with the learned Subordinate Judge that on the frame of the suit and in view of the nature of the dispute raised therein, such a dispute could not have been referred to the arbitrators for arbitration under the arbitration clause incorporated in the agreement itself which is challenged as void. There is no arbitration agreement independent of the agreement challenged as void in the suit. Therefore, if the agreement as a whole is adjudged to be void, as claimed in the suit, then the arbitration agreement too would be void and certainly the arbitrators can derive no jurisdiction thereunder to arbitrate nor are the parties bound by that agreement. Such a dispute, therefore, could not be referred to arbitration under that clause in that agreement. This position is now well-settled in view of the decision of the Supreme Court in the case of (1) Khardah Co. v. Raymon & Co., AIR 1962 SC 1810 , which has been reaffirmed by the Supreme Court in the case of (2) Waverly Jute Mills v. Raymon & Co., AIR 1963 SC 90 . In the latter case the Supreme Court made it clear that if a contract is illegal or void, an arbitration clause, which has been one of the terms thereof, must also perish along with it and a dispute relating to validity of a contract is, in such cases, for the Court and not for the arbitrators to decide. 7. Such being the position in law, we are of the view that the learned Subordinate Judge rightly concluded that no case for stay under section 34 of the Act had been made out in view of the dispute raised in the suit. 8. This appeal, therefore, fails and is dismissed.
7. Such being the position in law, we are of the view that the learned Subordinate Judge rightly concluded that no case for stay under section 34 of the Act had been made out in view of the dispute raised in the suit. 8. This appeal, therefore, fails and is dismissed. The order passed by the learned Subordinate Judge is affirmed. There will be no order for costs in this appeal. No decree need be drawn up. Let this order and the records, if they have come up to this Court, be sent down to the Court below forthwith. Chakrabarti, J. : I agree.