The collateral efficacy of an unregistered lease deed and the jurisdiction of the Commercial Court under Section 9 of the Act, 1996, as per the terms of the sub-lease agreement.

JUDGMENT :

R.C.S. Samant, J.

Heard.

1. This is an Appeal filed under Section 37 of the Arbitration and Conciliation Act, 1996 (in short “the Act, 1996”) against the impugned order dated 21.10.2021 passed by the Commercial Court (District Level), Raipur, C.G., by which the petition filed by the respondent under Section 9 of Act, 1996 has been allowed and relief has been granted to the respondent.

2. The subject matter in this case is the property measuring 2000 sq.ft. situated at Surya Treasure Island, near Apollo Hospital, Junwani Road, Surya Vihar, Smriti Nagar, Bhilai, C.G. with 5 kitchens constructed on it. The respondent and the appellants entered into an agreement on 30.09.2021 by which the appellants were provided a property by way of sub-lease agreement on terms and conditions as agreed. The respondent invoked the arbitration clause and filed the application under Section 9 of the Act, 1996 before the Commercial Court (District Level) Raipur, C.G. pleading that the appellants had made default in payment of lease amount which has become outstanding to the tune of Rs.1,18,10,000/- praying for relief of attachment of the property and attachment of the bank accounts of the appellants including other reliefs. The learned Commercial Court has passed the order allowing the application under Section 9 of the Act, 1996 and directing attachment of the bank accounts of the appellants and also directed to furnish a bank guarantee of the amount claimed by the respondents.

3. It is submitted by the learned Senior Counsel for the appellants, that it was agreed between the parties that before the sub-lease dated 30.09.2020 was to be made enforceable, appropriate stamping and registration was required as per the provisions under Transfer of Property Act, 1882. As the sub-lease was to extend beyond one year, and the sub-lease deed was not extended or registered, therefore, the appellant continued as tenant of month to month basis. Finding in the impugned order that the appellant had not made any payment to the respondent is totally false. There had been some delay in payment of the monthly rent in December 2020. There had been a clause for dispute resolution but without pursuing the same the respondent chose to invoke the arbitration clause of the unstamped, unregistered sub-lease dated 30.09.2020.

4. It is submitted by the learned Senior counsel for the appellants that the learned Commercial Court had no territorial jurisdiction to entertain the application under Section 9 of the Act, 1996 as the Seat of the Arbitration for the sub-lease according to the agreement was to be Indore. It is submitted that Hon’ble Supreme Court in the case of B.G.S. S.G.S. Soma J.V. v. N.H.P.C. Limited reported in (2020) 4 SCC 234, it is held very clearly regarding the place where should be the Seat of Arbitration. Hence, the impugned order passed is without jurisdiction, therefore, not sustainable.

5. Reliance has been placed on the judgments in the case of Hindustan Construction Co. Ltd. v. N.H.P.C. Ltd. reported in (2020) 4 SCC 310, Brahmani River Pellets Ltd. v. Kamachi Industries Ltd. reported in (2020) 5 SCC 462, Indus Mobile Distribution (P) Ltd. v. Datawind Innovations (P) Ltd. reported in (2017) 7 SCC 678, Balapreetham Guest House Pvt. Ltd. v. Mypreferred Transformation and Hospitality Pvt. Ltd. reported in 2021 SCC OnLine Mad 1126, Arvind Constructions Co. (P) Ltd. v. Kalinga Mining Corporation reported in (2007) 6 SCC 798, Adhunik Steels Ltd. v. Orissa Manganese and Minerals (P) Ltd. reported in (2007) 7 SCC 125, Ramesh Chandra Sankla v. Vikram Cement reported in (2008) 14 SCC 58, Modi Rubber Ltd. v. Guardian International Corporation reported in 2007 SCC OnLine Del 502 and Ajay Singh v. Kal Airways Private Limited and Others reported in 2017 SCC OnLine Del 8934.

6. The respondent party though served with notice has not given appearance and neither is represented by any counsel.

7. Considered on the submissions. The first submission regarding the non-oper