1. ' The dispute in this case relates to premises bearing No, 6E/123, situated in Orangi Township, Karachi. It is common ground that the premises were originally allotted on 10-1-1975 to one Tazeem Ahmed, the brother of respondent 3, Mst. Haseena Begum. According to the applicant the aforesaid allottee transferred the premises in partly built condition to the applicant for a consideration of Rs, 5,000 through a written agreement dated 18-1-1976, and handed over the possession to him. On 5- 4-1966, however, the original allottee Tazeeni Ahmed died. The applicant then completed the construction over the premises and applied for allotment of the same submitting the agreement dated 18-1-1976 to the K. D. A. In consequence to this application the K. D. A. Allotted the premises to the applicant on 22-12-1976 and executed a Lease Deed on 29-12-1976 for 99 years.
2. ' The respondent 3 according to the allegation of the applicant had certain arrangements with him whereby she was permitted to stay in one of the rooms built on the premises and it appears some dispute arose between the parties which deteriorated their relations. A dispute was therefore raised on the part of respondent 3 which resulted in litigation before the Magistrate as well as the civil Court from which the applicant obtained a decree for ejectment and mesne profits against respondent 3.
3. ' At this stage the respondent 3 complained to the Administrator of the K. D. A. Claiming that the premises were sold to her by her brother, the original allottee on 20-5-1972 for a consideration of Rs, 2,000. The matter was eventually referred to the Commissioner, Karachi, who seems to have treated it as an arbitration case in pursuance of clause 24 of the lease deed which provides for arbitration in case of dispute between the parties. The Commissioner issued a Show-Cause Notice to the applicant which has been placed on record (Annexure "F") stating that it had been reported to him that the applicant had obtained lease of the property by fraud and misrepresentation since the original allottee Mr. Tazeem Ahmed had actually sold it to Mst. Haseena Begum and called upon him to show cause why the lease deed in question should not be cancelled. The learned Commissioner then heard the representative of the K. D. A., the counsel for respondent 3 and the applicant. After considering the submissions of the aforesaid parties and considering the documents the learned Commissioner passed the award dated 25-5-1978, holding that the lease deed in favour of the applicant was obtained by fraud and misrepresentation and that the real transferee of the plot is respondent 3 to whom a proper transfer document be issued by the K. D. A.
4. ' The applicant has submitted the present application under Order XXXIII of the Arbitration Act, 1940 for a declaration that so-called award passed by the learned Commissioner dated 25-5-1978 is invalid and has no legal effect. Notices have been served on the learned Commissioner, the K. D. A.
5. And Mst. Haseena Begum but none has filed a counter affidavit.
6. ' Today when the case is called on for hearing respondent 3 and her counsel are absent. I have heard Mr. S. Sami, for the applicant and Mr. Sabir Hussain Kizalbash, on behalf of respondents 1 and 2.
7. ' Learned counsel for the applicant has raised several objections to the validity of the impugned award. However for disposing of this petition it is sufficient to refer to only one point namely, that an arbitrator is not in law competent to determine the question whether the parties to arbitration agreement at all entered into a valid agreement for arbitration. It will be noticed that the arbitration clause is contained in the lease deed in para. 2 to which the K. D. A. And the applicant are parties, The respondent is not therefore a party to the arbitration agreement. However the whole dispute arose on the complaint of respondent 3 and the perusal of the award would indicate that the learned Commissioner proceeded to determine the dispute inter se between the applicant and respondent 3. Obviously a dispute between a party to the arbitration agreement and a stranger to such an agreement was not referable for arbitration. Secondly the question before the learned Commissioner was whether the lease deed itself was vitiated on account of the fraud and misrepresentation in fact while giving his award he reached a finding that the applicant was guilty of fraud and misrepresentation in securing the lease deed. The arbitration agreement itself is a term of the lease deed and if the lease deed was struck down as void, the arbitration agreement itself cannot survive. The dispute if at all, referred to the learned Commissioner involved the determination of the question whether the lease deed itself was a valid document as the allegation was that it was obtained by fraud and misrepresentation. The effect of the adjudication of such a dispute would inevitably have been and was in fact that the learned arbitrator held that the lease deed was not a valid document. Since the arbitration clause itself is an integral part of the lease deed, the question is whether such a dispute was within the competence of the arbitrator to decide. In Bhoudarmull v. Uma Shankar (1), it was observed : "But when the question of submission itself is an issue in the sense that the controversy is whether the parties concerned at all entered into a valid agreement for arbitration, then that controversy cannot be decided by the arbitrators.
8. That jurisdiction belongs to the Court". Again in Suwalal Jain v. Clive Mills Company (2), it was held that where the contract is itself forbidden by law A and as such illegal, the arbitration clause which forms part of the contract is also illegal and void. The taint of illegality attached to every part of the contract including the arbitration clause. It is impossible to say that the arbitration clause is a legal contract although the rest of the contract is illegal and the width of the arbitration clause does not save it from the illegality. If the arbitration agreement is illegal and therefore, legally non-existent the fountain head of the award which the arbitrator may have made purporting to act under the legally non-existent arbitration clause is also invalid.
9. ' The principles enunciated in the aforesaid decisions are fully applicable to the present case. In this case also if the lease contract was bad in law on account of the fraud and misrepresentation, the arbitration clause itself would be similarly vitiated and there will thus be obliterated the very source of the authority of the learned arbitrator to arbitrate and pass the award.
10. ' I am therefore clearly of the view that the award is illegal on the face it and cannot be sustained.
(1) AIR 1953 Cal. 618
(2) AIR 1960 Cal, 90 ' In the result I allow this application and declare that the award is a nullity in law and is not binding upon the parties.
11. ' It will however be open to the parties to seek their remedies before an appropriate forum.