Case Title:
Gokaldas Images Private Limited versus Aries Agro-Vet Associates (Pvt) Limited &Anr.
Date of Order:
13 April, 2022
Judge:
E.S.Indiresh
Parties:
Appellant: Gokaldas Images Private Limited
Respondents: Aries Agro-Vet Associates (Pvt) Limited
FACTS OF THE CASE
- The respondent claims to be the owner of the subject property, and the respondent and petitioner have a lease document dated May 13, 2011, which is material information for the purpose of deciding this Writ Petition.
- The respondent filed Original Suit No. 25552 of 2017 before the trial court in an effort to prevent the petitioner from subletting the property listed on the suit schedule. The respondent is requesting relief from eviction, payment of back rent, damages, and consequential injunctions.
- The lawsuit was then moved to the Commercial court i n accordance with Section 8 of the Arbitration and Conciliation Act, 1996, the petitioner, who appeared in court, filed an application requesting to send the parties to arbitration under Clause 12 of the lease agreement dated May 13, 2011.
- The respondent in this case objected to the application in question. The application to submit the parties to arbitration proceedings was denied by the trial Court by the impugned order of 08th August, 2018, after the trial Court had reviewed the evidence in the record. The petitioner submitted this plea because he feels wronged by the same.
ARUGMENTS BY THE PETITIONER
- The petitioner claimed that the trial court denied the application in accordance with the legal guidelines established by the Hon'ble Supreme Court in the case of Himangi Enterprises v. Amaljit Singh Ahulvalia, decided in Civil Appeal No. 16850 of 2017 on October 12, 2017, in which the Hon'ble Supreme Court ruled that the lease dispute is not of an arbitral nature.
- However, learned senior counsel drew the court's attention to the judgement of the Hon'ble Apex Court in the case of VIDYA DROLIA v. DURGA TRADING CORPORATION reported in (2019)20 SCC 406. He argued that the Hon'ble Supreme Court held that the judgement in HIMANGI ENTERPRISES (supra) requires a re-look by a Bench of three Hon'ble Judges of the Hon'ble Supreme Court
ARGUMENTS BY RESPONDENT
- The impugned decision was issued on August 8, 2018, and the current Writ Petition was filed in 2022, resulting in a three-year delay that prevents the petitioner from being eligible to get relief under the Writ Petition, according to the respondent, who claimed that the Writ Petition lacks substance.
- It was also argued that the dispute was nearing the conclusion of the Commercial Court's proceedings. As a result, the respondent tried to defend the impugned decision made by the trial Court by pointing to her request for relief from eviction and rent arrears.
OBSERVATION BY THE COURT
- The Trial Court determined that the lis between the parties relates to eviction as well as rent arrears and, as a result, same are non-arbitrable in nature and, as a result, dismissed filed by the defendant/petitioner herein by referring to the decision passed by the Hon'ble Supreme Court in the case of HIMANGI ENTERPRISES (supra). The Court has taken it into consideration the later judgement of the Apex Court in the case of VIDYA DROLIA (supra), which at paragraph 12 of the judgement makes the following observation:
- Arbitration is permitted in landlord-tenant conflicts covered by the Transfer of Property Act since they are not actions sin tem but rather include derived rights in personam from rights in tem. Normally, such conduct wouldn't impair the rights of third parties, have an erga omnes effect, or call for centralised adjudication. An order resolving a landlord-tenant conflict may be carried out in accordance with the State's unalienable and sovereign duties. Arbitration is not expressly prohibited by the Transfer of Property Act's provisions or automatically implied by them. Like all other Acts, the Transfer of Property Act serves a public purpose by regulating landlord-tenant interactions, and the Arbitrator would be bound by its provisions, including those that benefit and protect renters.
- In light of the aforementioned, the court reversed the reasoning in HIMANGI ENTERPRISES and old that the Transfer of Property Act does not preclude or prohibit arbitration and that landlord-tenant conflicts are arbitrable. However, when a particular court or forum has been given exclusive authority to apply and adjudicate on unique rights and responsibilities, landlord-tenant issues covered and governed by rent control laws would not be subject to arbitration. Such rights and responsibilities cannot be arbitrated or enforced outside of the designated court or venue.
CONCLUSION
In light of this, the court determined that the impugned order issued by the trial court on August 8, 2018, should be revoked. As a consequence, it was overturned, and the Writ petition was subsequently granted.
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