9911796707
TMI Blog2023 (2) TMI 1339X X X X Extracts X X X X X X X X Extracts X X X X ..... approx. 25000 sq. feet on ground floor, 25000 sq. feet on first floor, total area 50000 sq. feet which also includes the mezzanine floor sides, washroom and rooms at the back, genset panel and the sundry assets area etc. at a monthly rent of Rs. 8,00,000/-(Eight Lakhs only) exclusive of all other charges. 3. It is submitted by the petitioner/lessor that the respondent/lessee is a habitual defaulter in payment of rent. It is further submitted that the petitioner/lessor terminated the tenancy vide legal notice dated 04.05.2022 and also claimed arrears of rent amounting to Rs. 29,49,350/-. 4. By way of another legal notice dated 24.05.2022, the petitioner invoked the Arbitration Clause contained in the lease deed dated 15.12.2019, and sought appointment of an arbitrator. The Arbitration Clause, as contained in the said lease deed is as under: "Clause-25 That if any dispute may arise in regard to interpretation and/or implementation of terms and conditions of this deed the same shall be referred to the Arbitrator under Arbitration & Conciliation Act, 1996, whose decision shall be final and binding on both the parties and/or the same may be defended subject to Delhi Court Jurisdi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he same may be defended subject to Delhi Court Jurisdictions only", are evidently, intended to convey that any decision of the arbitrator would be subject to jurisdiction of the Delhi Courts. The Clause cannot be construed as giving an option to any party to either take recourse to arbitration or alternatively, file a civil suit. 11. The reliance placed by learned counsel for respondent in the case of Wellington Associates (supra) is completely misconceived. The relevant clause that fell for consideration in Wellington Associates (supra) was as under: "Clause 4: It is hereby agreed that, if any dispute arises in connection with these present, only courts in Bombay would have jurisdiction to try and determine the suit and the parties hereto submit themselves to the exclusive jurisdiction of the courts in Bombay. Clause 5: It is also agreed by and between the parties that any dispute or differences arising in connection with these presents may be referred to arbitration in pursuance of the Arbitration Act, 1940, by each party appointing one arbitrator and the arbitrators so appointed selecting an umpire. The venue of arbitration shall be at Bombay." 12. It was in the context of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Clause 4 that fell for consideration in that case, that the Supreme Court found that there was no mandatory stipulation binding the parties to Arbitration, and that arbitration was not intended to be the sole remedy of the parties. On the contrary, in the present case, the arbitration clause is couched in mandatory terms and clearly provides "that if any dispute may arise in regard to interpretation and/or implementation of terms and conditions of this deed the same shall be referred to the Arbitrator under Arbitration & Conciliation Act, 1996." 14. In the context of arbitration agreement embodied in lease deeds/tenancy agreements, the Supreme Court in Vidya Drolia vs. Durga Trading Corporation (2021) 2 SCC 1, has expressly held as under: "79. Landlord-tenant disputes governed by the Transfer of Property Act are arbitrable as they are not actions in rem but pertain to subordinate rights in personam that arise from rights in rem. Such actions normally [Ed. : Certainly in those cases where the dispute only affects the parties to the arbitration clause, third-party rights would not be affected, as in the facts of the present case. It is in such cases that "such actions under th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... can only be adjudicated and enforced by the specified court/forum, and not through arbitration." 15. In Suresh Shah Vs. Hipad Technology (India) (P) Ltd. (2021) 1 SCC 529, taking note of the judgment of the Supreme Court in the case of Vidya Drolia (supra) in the context of disputes between landlords and tenants, and considering the provisions incorporated in Sections 114 and 114A of the Transfer of Property Act, it has been held as under:- "17. Such equitable protection does not mean that the disputes relating to those aspects between the landlord and the tenant is not arbitrable and that only a court is empowered to waive the forfeiture or not in the circumstance stated in the provision. In our view, when the disputes arise between the landlord and tenant with regard to determination of lease under the TP Act, the landlord to secure possession of the leased property in a normal circumstance is required to institute a suit in the court which has jurisdiction. However, if the parties in the contract of lease or in such other manner have agreed upon the alternate mode of dispute resolution through arbitration the landlord would be entitled to invoke the arbitration clause and mak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... connection with this Agreement or the security hereof or the validity, interpretation, implementation or alleged breach of this Agreement or anything done or omitted to be done pursuant to this Agreement or otherwise in relation to the security hereof, the parties shall attempt in the first instance to resolve the same through negotiation/ conciliation. If the dispute is not resolved through negotiations/ conciliation within thirty days after commencement of discussions or such longer period as the parties agree to in writing then the same shall be settled by arbitration to be held in Chennai/Delhi/Mumbai in accordance with the Arbitration and Conciliation Act, 1996 or any statutory amendments thereof and shall be referred to a person to be appointed by TCHFL. In the event of death, refusal, neglect, inability, or incapability of the person so appointed to act as an Arbitrator, TCHFL may appoint a new arbitrator. The award of the arbitrator shall be final and binding on all parties concerned. Notwithstanding anything contained hereinabove, in the event due to any change in the legal status of TCHFL or due to any change or amendment in law or notification being issued by the Cent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the defendant against the plaintiffs is concerned but will continue to have effect as far as the claims of the plaintiffs against the defendant are concerned. 28. On enquiry, whether there can be a valid arbitration clause providing for arbitration of claims of one of the party and providing for the remedy of the Court or any other for a for claims of the other party, the counsel for the defendant is unable to cite any law. 29. Section 7 of the Arbitration Act defines an 'arbitration agreement' as meaning an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not. In my view, the words "all or certain disputes" permit classification of disputes but do not permit classification of claims. The said words, in my view, do not allow a provision providing for claims of one of the parties arising in respect of a defined legal relationship to be adjudicated by arbitration but the claim of the other party arising in respect of the same legal relationship to be adjudicated by any other mode. The same would be contrary to the public policy pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onciliation Act, 1996, should in my view be interpreted so as to bring in line the principles underlying its interpretation in a manner that is consistent with prevailing approaches in the common law world. Jurisprudence in India must evolve towards strengthening the institutional efficacy of arbitration. Deference to a forum chosen by parties as a complete remedy for resolving all their claims is but part of that evolution. Minimising the intervention of courts is again a recognition of the same principle." 23. In Govind Rubber Ltd. v. Louis Dreyfus Commodities Asia (P) Ltd., (2015) 13 SCC 477, it has been held as under:- "17. We are also of the opinion that a commercial document having an arbitration clause has to be interpreted in such a manner as to give effect to the agreement rather than invalidate it. On the principle of construction of a commercial agreement, Scrutton on Charter Parties (17th Edn., Sweet & Maxwell, London, 1964) explained that a commercial agreement has to be construed, according to the sense and meaning as collected in the first place from the terms used and understood in the plain, ordinary and popular sense (see Article 6 at p. 16). The learned author ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tract, and that such derogations must be construed narrowly. Thus, in an older decision, a French appellate court declared that "[t]he arbitration agreement must be strictly interpreted as it departs from the norm-and in particular from the usual rules as to the jurisdiction of the courts." 'This restrictive interpretative presumption is archaic and out of step with the ordinary intentions of commercial parties; it is generally not applied in contemporary decisions." 27. It is also noteworthy that the Supreme Court has emphasized that while exercising jurisdiction under Section 11, the Court is to take a 'prima facie' view on issues relating to existence of arbitration agreement, and that issues of arbitrability/validity are matters to be adjudicated by the arbitral tribunal The only narrow exception is to "cut the deadwood". It has been emphasized that the watchword for the Court is "when in doubt, do refer". In this regard, reference is apposite to the observations of the Supreme Court in Intercontinental Hotels Group (India) Pvt. Ltd. v. Waterline Hotels Pvt. Ltd (2022) 7 SCC 662, as under: "19. At the outset, we need to state that this Court's jurisdiction to ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
