The requirement to refer disputes to the Executive Director (Building) for settlement before arbitration, as per the terms of the Agreement, influenced the court's decision.

M. R. MALLICK, J.

( 1 ) THIS is a suit under section 20 of the Indian Arbitration Act for filing the Agreement and for passing some consequential order in terms of Clause 39 of the Agreement which, according to the plaintiff, is the Arbitration Clause.

( 2 ) ON behalf of the defendant, Life Insurance Corporation of India, a preliminary objection has been raised and an application has also been fled to that effect. An affidavit-in-opposition has also been filed raising preliminary objection against the maintainability of the petition.

( 3 ) MY attention has been drawn to Clause 39 of the Agreement and it is submitted that the present plaintiff has sought to file the Arbitration Amendment and also sought for reference to the Arbitrator as disputes have arisen on the following two points, namely, (1) Termination of Agreement ; and (2) Demand of about Rs. 7,00,000/- from the defendant, Life Insurance Corporation of India.

( 4 ) IT is submitted that the termination order is an excepted matter, not referable to arbitration. It is also submitted that Clause 39 of the Agreement clearly spells out that all disputes and differences have to be first referred to the E. D. (B) , meaning thereby, Executive Director (Building) and the decision of the Executive Director (Building) on the excepted matter of the Agreement shall be final and cannot be referable to arbitration. Regarding other matters disputes can be referred to arbitration under Clause 39 after the matter is refered to E. D. (B ). The defendant, therefore, submits that the plaintiff has not referred any of the two disputes to the Executive Director (Building) and without doing that he cannot file this application under section 20 of the Indian Arbitration Act.

( 5 ) ON considering the Supreme Court's judgment, reported in AIR 1967 SC 990 (W. C. Mcchajan v. Union of India) find that while deciding a suit under section 20 of the Indian, Arbitration Act the Court has to see only 4 points which are as follows : (1) Whether there is any valid and subsisting Arbitration Agreement between the parties ; (2) If so, whether such Arbitration Agreement was entered into by and between the parties before the institution of the suit with respect to the subject matter of the Agreement or any part thereof ; (3) Whether a dispute or difference to which such Agreement applies has arisen ; and (4) Whether the Court has a jurisdiction to pass an order under this Section.

( 6 ) ON behalf of the defendant it is submitted that dispute or difference to which the Agreement relates has not arisen and it is pointed out that until and unless the dispute or difference raised by the plaintiff in this petition is first referred to the Executive Director (Building) and his decision is taken, there cannot be any scope of any dispute being referred to arbitration.

( 7 ) III my view, this is a very narrow interpretation of the Agreement. Dispute has arisen, no doubt even at least in respect of one such matter regarding the claim of Rs. 7,00,000/ -. But the machinery for the settlement of the dispute in the first instance by the Executive Director (Building) has not yet been taken by the present plaintiff. For that purpose it cannot be said that dispute or difference has not arisen. Dispute or difference has admittedly arisen and a portion of it admittedly attracts Clause 39 of the Agreement. In that view a preliminary order regarding filing of the Agreement can be made. But, thereafter the machinery referred to in Clause 39, has to be followed -by the plaintiff before ultimately the dispute which is not an excepted dispute can be referred to the Arbitrator for arbitration.

( 8 ) IN that view of the matter, on hearing the submissions made on behalf of the plaintiff as well as the defendant and on considering the petition under section 20 of the Indian Arbitration Act, Affidavit-in-opposition, filed by the defendant and the other application filed by the defendant, I dispose of this suit with the following o

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