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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
Somasekhar Sundaresan
Dimple Enterprises – Appellant
Versus
Wework India Management Pvt. Ltd. – Respondent
JUDGEMENT :
Somasekhar Sundaresan, J.
Context and Factual Background:
1. Whether the declaration of law in Vidya Drolia[ Vidya Drolia vs. Durga Trading Corporation – 2021 2 SCC 1] about disputes under bilateral lease deeds being arbitrable, has no relevance for arbitrability of such disputes in Greater Mumbai is the key question raised in these proceedings.
2. This Petition is essentially an Appeal under Section 37 of the Arbitration and Conciliation Act, 1996 (“Arbitration Act”) challenging an order / award dated October 6, 2020 (“Impugned Order”) passed by a Learned Arbitral Tribunal allowing an application under Section 16 of the Arbitration Act, holding that disputes and differences between the parties over a lease deed are not arbitrable.
3. The Petitioner, Dimple Enterprises, a partnership firm (“Dimple”) entered into a Lease Deed with WeWork India Management Pvt. Ltd. (“WeWork”) on May 28, 2018, leasing out 1,50,005 square feet of carpet area in a building called K. Raheja Platinum for a period of ten years. The lease rental payable was in the sum of Rs.~ 2.57 Crores per month, escalated by 15% every three years.
4. To secure payment of lease rentals, electricity and other related
The court established that lease disputes, without special tenant protections, are arbitrable, overruling prior decisions and endorsing the Supreme Court's findings in Vidya Drolia.
Arbitration agreements under the Arbitration & Conciliation Act remain valid and binding despite exclusive jurisdiction claims by special statutes like the Presidency Small Cause Courts Act.
The main legal point established in the judgment is that disputes governed by the Transfer of Property Act are arbitrable, while those governed by rent control legislation are non-arbitrable and can ....
Disputes between landlords and tenants governed by rent control legislation are non-arbitrable and must be addressed exclusively by statutory authorities.
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