that where the contract is challenged as being void on the ground of illegality, the arbitration clause contained in the contract is also avoided ... invalidity of the arbitration clause. In other words even if the contract is held to be void the clause regarding arbitration found in a void
arbitration clause operates in respect of these purposes."
The Supreme Court, as hereinbefore mentioned, noted that however comprehensive the terms of an arbitration clause ... initio, the arbitration clause could not operate. If, however, the pleas raise grounds for avoiding a contract validly entered into, the arbitration clause survived
summed up the
position in so far as arbitration clause is
concerned. Considering that the arbitration clause
is a written submission agreed ... arbitration clause which clause is contained
in a written contract the clause can give
jurisdiction to the arbitrators under that clause
to determine a dispute
entire contract which contains the arbitration agreement is held to be void, the arbitration clause in such a void contract has no independent existence ... invalidity of the arbitration clause."
A perusal of the aforesaid provision makes it clear that an arbitration clause in an agreement shall be treated
arbitration clause contained in the main agreement under
Annexure-1. As such, the arbitration agreement is void and not
enforceable being in contravention of Sections ... validity of the arbitration
clause was also not the subject matter in dispute in the said
writ petition. Thus, the arbitration clause/agreement which
position with regard to scope of an arbitration clause in a
contract as follows :
"An arbitration clause is a written submission, agreed ... contract is illegal), the arbitration clause cannot
operate, for on this view the clause itself is also void.
If, however, the parties
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 ... Banks. 10.
193
arbitration clause, was void ab initio on the ground of
uncertainty and that there was in fact no contract owing to
mutual
regard to existence or validity of the
arbitration agreement. The Arbitration Act emphasises that
an arbitration clause which forms part of a contract shall ... disputes to
arbitration. The High Court had accepted the plea that since
the underlying contract was void, the arbitration clause
perished with it. The judgment
followed,
(3) if a contract was illegal and void, an arbitration
clause which was one of the terms thereof must perish along
with ... have held that
it a contract is illegal and void, an arbitration clause
which is one of the terms thereof, must also perish along
arbitration proceedings under the aegis
of ICC as the Facilitation Deed, which also contains the arbitration
agreement in Clause 9, is void because of fraud ... have
to decide whether the Facilitation Deed including the arbitration
agreement in Clause 9 was void on account of fraud and misrepresentation
by the appellant
