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TMI Blog2010 (2) TMI 1293X X X X Extracts X X X X X X X X Extracts X X X X ..... ered agreement was executed between the parties for a period of three years with the lease coming into effect from 03.03.1977. The three years term having expired by efflux of time on 03.03.1980, the appellant continued as a month to month tenant by holding over. The terms of the oral tenancy also kept on changing and on 01.01.2005, a new oral month to month tenancy came into existence whereunder the rent of the suit property was increased to ₹ 15,000/- per month. 3. On 30.08.2006, the respondent served upon the appellant a notice to quit to which the appellant replied on 30.10.2006. On 04.12.2006, a civil suit No. 286/2006 was filed by the respondent before the trial court for ejectment and recovery of mesne profits. The appellant filed an application under Section 8 of the Arbitration Act for referring the matter to a sole Arbitrator on the basis of an arbitration clause contained in the lease agreement dated 16.08.1978. This application was dismissed by the trial court holding that the terms of tenancy stood changed between the parties by an oral agreement and the defendant, therefore, could not rely upon the agreement dated 16.08.1978 to claim existence of an arbitrati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncluding the one which provides for an arbitration between the parties. An arbitration agreement can be enforced only along with the contract between the parties and such a contract must be a valid contract, admissible under law. If a contract is not admissible in law, every clause of it is inadmissible in law including arbitration clause. 6. Even if this lease agreement had been a registered lease agreement, on expiry of the lease period fixed in the original lease deed, the lease would have come to an end. Since no written lease deed was executed between the parties a new contract of tenancy had come into existence between the parties created orally. The parties cannot resort to the terms and conditions of the exhausted contract when a new contract had come into existence. If parties wanted that there should have been an arbitration clause between them in respect of further tenancy period, nobody stopped the parties from entering into such an agreement in writing, which is the basic requirement of any arbitration clause. Therefore, the reasoning of the petitioner that there was an arbitration clause in 1978 agreement was rightly rejected. When the written lease deed came to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of term of agreement. Courts below have rightly held that after expiry of five years, the agreement was non-existent and the arbitration clause was not applicable. This view finds support from the law laid down by Hon'ble the Apex Court in Union of India v. Kishori Lal Gupta and Brothers AIR 1959 SC 1362. 8. In Ghulan Hassan Dar v. Controller of Aerodrome AIR 1987 J K 25; Jammu Kashmir High Court had considered a similar situation and observed as under: After the expiry of the period of licence and after the expiry of period of agreement nothing survives for arbitration. The arbitration clause was for any dispute or difference of questions having regard to the covenants and conditions of the agreement and in respect of rights, duties and liabilities and duties of the contracting parties. This clause after the lapse of the agreement will cease to be effective because the petitioner's right as licensee has ended with the expiry of period of licence. 9. .... 10. .... 11. I find that the trial Court rightly dismissed the application of the petitioner. This petition has no force and is hereby dismissed. 6. A Special Leave Petition filed by the appellant, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deep Sethi, the learned senior counsel for the appellant and Mr. Arun Mohan, the learned senior counsel for the respondent have been heard and the relevant documents adverted to by them have been perused. In the course of his submissions, Mr. Sandeep Sethi referred to the notice to quit dated 30.10.2006 and in particular to paragraph 10 of the said notice, which is reproduced as under: 10. That the contents of para No. 8 are denied to the extent that the commission on sales have been discontinued, however, it is admitted that the same have been included in the consolidated rent of ₹ 15,000/- per month. 11. Mr. Sethi also referred to paragraph 12 of the reply to the aforesaid notice, which reads as follows: 12. That the contents of para No. 10 are denied to the extent that the occupation of the premises by my clients is in terms of the aforesaid two agreements, it is not to be termed as a simple tenancy. However, the consolidated rent including the commission on sales in terms of the agreement is ₹ 15,000/- per month. It is also admitted that the rent stands paid till date. 12. Referring to the relevant paragraphs of the written statement, Mr. Sethi also co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate from consideration, I am of the view that the appellant in its pleadings having clearly admitted that there was a landlord-tenant relationship, that a consolidated rent of ₹ 15,000/- per month was being paid by it to the respondent and also that the respondent had served upon the appellant the notice to quit, which was replied to by the respondent, there was no impediment to the passing of a decree for ejectment on the aforesaid admissions, leaving the question of mesne profits to be tried on the basis of evidence adduced by the parties See Surjit Sachdeva v. Kazakstan Investment 66 (1997) DLT 54; Samir Mukherjee v. Devinder K. Bajaj 71 (1998) DLT 477; Vikas Theatres v. Punjab Sind Bank 71 (1998) DLT 526; Shukla Malhotra v. Vyasa Bank Ltd. 73 (1998) DLT 124; Amar C. Talwar v. Export Promo Council 77 (1999) DLT 809; Deenar Builders v. Khoday Distilleries 82 (1999) DLT 809; Zulfiquar Ali Khan v. Straw Products 2000 VI AD (Delhi) 347; Jasmer Singh v. Electronics Trade Tech (2002) I AD (Delhi) 281; R.K. Aggarwal v. ITDC 1997 (1) RCR 401; Uttam Singh Dugal v. UBI (2000) 7 SCC 120; and Delhi Jal Board v. Surendra P. Malik 104 (2003) DLT 151. 17. It is settled law that ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... outliving his life span itself and falling into the lap of his survivors. 19. As regards the plea of the appellant's counsel that the trial court has failed to appreciate that, the question whether the agreement dated 16.08.1978 was in fact a business agreement or purely a tenancy agreement was an issue in dispute, I am of the view that the findings of this Court in Civil Revision Petition No. 166/07 on this aspect of the matter are conclusive and binding in the instant appeal as well. This Court in the former case between the same parties having held that an oral tenancy on a month to month basis existed between the parties and the said finding having withstood the test of appeal before the Supreme Court, it is no longer open to this Court to hold that there was a business relationship subsisting between the parties and that too in the teeth of the clear admission of landlord-tenant relationship by the appellant. The principle of res judicata, as is well known, would not only apply in different proceedings arising out of the same cause of action but would also apply in different stages of the same proceedings so that if an issue has been decided at an earlier stage against ..... X X X X Extracts X X X X X X X X Extracts X X X X
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