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TMI Blog2013 (1) TMI 240X X X X Extracts X X X X X X X X Extracts X X X X ..... usive possession. The agreement admittedly expired on December 13, 2006. He remained in permissive possession up to May 2007 when the society asked him to vacate. As per Clause 24, he would attract penalty of Rs.5,000/- (Rupees five thousand) per day as liquidated damage. Thus once the Arbitrator held that by virtue of the agreement the society did not part with possession of the flower unit and the appellant was only entrusted to run the unit on the terms and conditions stipulated therein including the one that he would have to collect the key every morning and deposit the same at the end of the day after close of the unit the Arbitrator was well within his right to direct delivery of possession. The Arbitrator came to conclusion that the agreement would denote the society would get back possession on the termination of the agreement by afflux of time or otherwise. From the case made out by the appellant, the breach under the agreement was a foregone conclusion, as the appellant’s claim for exclusive possession through tenancy was held to be not correct in view of well-settled principle of law. There could not be any further scope to adduce evidence. Arbitrator is the master of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is cost. He would also have to discharge all statutory outgoings electricity charges and other incidentals to run the counter. iii) He or his representative would visit the society every morning and would collect the key from the society s office. iv) The initial period of 13 (thirteen) years could be renewed for another 13 (thirteen) years period having a minimum commission to the society at the rate of 20 per cent provided there was no breach of any terms and conditions by the appellant. v) Society would be entitled to terminate the agreement as per Clauses 8 and 15 upon failure of the appellant to run the same by committing breach of any of the terms and conditions of the agreement and in such event he would forthwith hand over possession back to the society, default of which, would attract penalty of Rs.5,000/- (Rupees five thousand) per day. vi) Clause 25 would be denote that any dispute between the parties would be resolved by alternative resolution of dispute mechanism through arbitration. The appellant accordingly took possession. The agreement expired by afflux of time. On December 13, 2006 the society did not renew the agreement, however allowed him to continue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id not give them reasonable opportunity to defend the Statement of Claim. The society contested the arbitration by filing affidavit-in-opposition. In the affidavit the society annexed the minutes of the meeting of the arbitration to show that the appellant had prayed for adjournment and those accommodations had been given by the Arbitrator. Two Arbitrators could not conclude the proceedings during their tenure. Ultimately Sri Swarup concluded the proceeding resulting in an Award after giving adequate opportunity to the appellant. The learned Single Judge dismissed the petition by judgment and order dated August 24, 2011 appearing at page 329-358 of the paper book. His Lordship s painstaking judgment dealt with all issues that were raised before him and ultimately gave a conclusion that as per the agreement the society was entitled to terminate and was also entitled to get possession back. The liquidated damage was calculated on the basis of fixed amount as agreed by and between the parties in the agreement. His Lordship rejected the contentions of the appellant that they were tenant and they had exclusive possession of the flower shop. His Lordship based His judgment on the Ape ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his eviction upon compliance of the statutory provision of the tenancy law. He contended, tenancy not having been terminated in accordance with the tenancy law, the appellant was entitled to remain in possession and the Arbitrator could not have directed his eviction. On the money claim, he contended, since the appellant was entitled to be in possession, question of liquidated damage would not arise. The appellant lastly contended, on the identical cause suit was pending before the appropriate Court. Hence, Arbitrator could not have directed handing over of possession that would be in direct conflict with the pending suit. We are told that the said suit was still pending and awaiting disposal before the appropriate Civil Court. Mr. Mukherjee further contended that the Arbitrator concluded the hearing with undue haste. He not even considered the personal difficulty of the learned counsel who was indisposed. He referred to the medical documents, pertaining to the illness of the then Advocate-on-Record to show that the Arbitrator was biased and was bent upon to publish, the award in favour of the society. He contended, the Arbitrator, being the President of the Society, was biased ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by an alternate dispute resolution mechanism. He put emphasis on the Apex Court decision cited above. On the money claim, Mr. Basak relied on Clause-24 that would attract quantified damage of Rs.5,000/- (Rupees five thousand) per day on the agreement being terminated either by afflux of time or otherwise. He relied on the Apex Court decision in the case of Oil Natural Gas Corporation Ltd. Vs. Saw Pipes Ltd. reported in 2003 Volume 5 Supreme Court Cases page-705. He relied on paragraph-68 of the said decision which is quoted below: From the aforesaid discussions, it can be held that: (1) Terms of the contract are required to be taken into consideration before arriving at the conclusion whether the party claiming damages is entitled to the same. (2) If the terms are clear and unambiguous stipulating the liquidated damages in case of the breach of the contract unless it is held that such estimate of damages/compensation is unreasonable or is by way of penalty, party who has committed the breach is required to pay such compensation and that is what is provided in Section 73 of the Contract Act. (3) Section 74 is to be read along with Section 73 and, therefore, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gal proceedings. In case of S.L. Kapoor (supra) the Apex Court observed where on the admitted or indisputable facts only one conclusion is possible and under the law only one penalty is permissible, the Court may not issue its writ to compel the observance of natural justice, not because it is not necessary to observe natural justice but because Courts do not issue futile writs. These paragraphs, in our view, would rather help us, to hold otherwise. In the instant case, the Arbitrator came to conclusion, so do we, the agreement would denote the society would get back possession on the termination of the agreement by afflux of time or otherwise. From the case made out by the appellant, the breach under the agreement was a foregone conclusion, as the appellant s claim for exclusive possession through tenancy was held to be not correct in view of well-settled principle of law. There could not be any further scope to adduce evidence. Arbitrator is the master of his own procedure. It is not expected, he would rigidly follow the procedural law that was available in a regular civil action. Resolution of a dispute through domestic forum would not attract such procedure to be rigidly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of Smt. Rajbir Kaur (supra) the Apex Court considered dispute under the tenancy law where landlord sought eviction of the tenancy. Paragraph 10 and 23 were relied upon. The Apex Court in paragraph 10 observed exclusive possession itself is not decisive in favour of a lease and against a mere licence, for, even the grant of exclusive possession might turn out to be only a licence and not a lease where the grantor himself has no power to grant the lease . In paragraph-23 the Apex Court observed, if exclusive possession is established, and the version of the respondent as to the particulars and the incidents of the transaction is found unacceptable in the particular facts and circumstances of the case, it may not be impermissible for the Court to draw an inference that the transaction was entered into with monetary consideration in mind . Mr. Mukherjee contended that payment of Rs.5,000/- (Rupees five thousand) per month was the monetary consideration in lieu of exclusive possession being handed over to the appellant. The facts would depict otherwise. We do not find any scope of application of this decision in the present case. If we closely examine the payment clause we would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal, are as under: (i) Whether the disputes are capable of adjudication and settlement by arbitration? That is, whether the disputes, having regard to their nature, could be resolved by a private forum chosen by the parties (the Arbitral Tribunal) or whether they would exclusively fall within the domain of public for a (courts). (ii) Whether the disputes are covered by the arbitration agreement? That is, whether the disputes are enumerated or described in the arbitration agreement as matters to be decided by arbitration or whether the disputes fall under the excepted matters excluded from the purview of the arbitration agreement. That is, whether the disputes are enumerated or described in the arbitration agreement as matters to be decided by arbitration or whether the disputes fall under the excepted matters excluded from the purview of the arbitration agreement. (iii) Whether the parties have referred the disputes to arbitration? That is, whether the disputes fall under the scope of the submission to the Arbitral Tribunal, or whether they do not arise out of the statement of claim and the counterclaim filed before the Arbitral Tribunal. A dispute, even if it is ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision of the case of Naraindas Lilaram Adnani (supra) particularly paragraphs 8, 9 and 10. In paragraph-8 the Apex Court observed it would not now be fair to direct the appellant to seek his remedy of possession through the two suits which he has filed and which may take considerable time to be finally disposed of, when the consequential relief of possession could have been granted to him under the Award itself. Mr. Mukherjee contended that prayer for possession was not consequential in the present case. Examining the facts involved in the case of Naraindas Lilaram Adnani (supra) we would find that in a family dispute the resolution of dispute of a family partnership farm was assigned to the Arbitrator by the parties. The Arbitrator observed in paragraph 61 of the Award that Narain Niwas was the exclusive personal property of the deceased and the question of possession would be governed by the Bombay Rent Act. The appellant contended that the Arbitrator having held that Narain Niwas was exclusive personal property of the deceased, should have granted consequential relief of possession. Such argument was accepted by the Apex Court. In the instant case, once the Arbitrat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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