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2002 Supreme(Del) 1572

High Court Of Delhi
R.C.AGRAWAL - Appellant
Versus
DELHI TOURISM AND TRANSPORTATION DEVELOPMENT CORPORATION LIMITED - Respondent
Interim Application 8461 of 1996
Decided On : 10/04/2002

Advocates Appeared:
MANINDER SINGH

Headnote:Arbitration and Conciliation Act, 1996 - Sections 7, 8 & 16 — Arbitration clause — Invocation — An arbitration clause cannot be invoked after expiry of the agreement or contract between the parties or in the absence of renewal of the expired agreement, and on expiry of the agreement, civil suit is the only remedy available to the applicant.

       Held:

       The arbitration agreement hay to be in writing duly signed by the parties. In the instant case the arbitration agreement upon which the respondent is banking became dead almost 20 years back. Merely because the plaintiff has not taken the remedy for 10-15 long years and letters after letters were sent and ultimately he served the legal notice-does not mean that he is left remediless. The only remedy available to the plaintiff is by way of suit and not through arbitration as claimed by the respondent/applicant.

J. D. KAPOOR

( 1 ). Short question involved for determination in this application under Section 8 is whether the arbitration clause can be invoked after the expiry of the agreemient or contract between the parties or in. the absence of renewal of the expired agreement.

( 2 ) THE facts are more or less broadly bromtited and are as under:

( 3 ) THE applicant floated a tender notice on 16th April, 1982 inviting sealed tenders for offer of shop premises for opening of Indian made Foreign liquor (in short IMFL) shops in various areas of Delhi, Pursuant to this notice plaintiff submitted its tender offering the suit premises for sale of IMFL. As a consequence the parties entered into a licence agreement dated 15th July, 1982. As per clause 4 of the said agreement the licence was granted for a period of one financial year beginning from April, 1982 and ending on 31st March, 1983. Clause 15 of the said agreement was an arbitration clause which is to the following effect:-

"if any dispute of differences arises between the parties here to or their representatives or in regards to any other matter under these presents, save as to any matter the decisioon whereo is herein before expressly provided for, the same shall he referred to the solo arbitration of the Chairman of Delhi Tourism Development Corporation Ltd. , and if he is unable or unwilling to act, to the sole arbitration some other person appointed by him. It will be no objection to any such appointment that the person appointed is/was an employee of the Corporation or that he had to deal with the matters to which the contracts relates and that in the course of his duties as such employee of the Corpn. He had expressed views on all or any of the matter in dispute or difference. The reference to the Arbitration shall be deemed to be a submission within the meaning of the Arbitration act, 1940, or any statutory modification or reenactment thereof, and the rules made there under for the time being in force shall apply to such reference and this deed shall be deemed to be submission to such arbitration. "

( 4 ) THE respondent requested the plaintiff vide communication dated 31st May, 1988 to enter into or renew the agreement and enclosed the draft agreement alongwith it. In response the plaintiff reminded the respondent/applicant that. he was no more interested in entering into or renewing any agreement on the sane terms and conditions.

( 5 ) HE also made it clear in the said communication that he has written several letters to the defendant before terminating the agreement for vacating the premises and again called upon the defendant to vacate the premises at the earliest. The plaintif did not pay any heed and was served a legal notice. It did not have any effect upon the respondent which gave rise to the instant suit. . .

( 6 ) THERE is no dispute as there is unvarying unanimous current of opinion that the arbitraton clause in any agreement is incorporated with the sole intention of resolving the disputes that would arise during the currency of the agreement. Mr. Maninder Singh, learned counsel for the respondent, has referred to large number of authorities to convass the point that any dispute arising between the parties even after the agreement or contract has expired is liable to be determined and decided by way or arbitration if the parties in the original agreement had agreed to do so. I am afraid all the authorities relied upon by Mr. Singh are to the effect that the Arbitration clause operates till the agreement or a contract is in existence. If the agreement becomes non-existent or expires, the remedy not is to get the dispute decided or determined by way of arbitration clause.

( 7 ) IN the same vein the contention of Mr,singh that section 16 of the Arbitration Act, 1996 empowers the arbitrator to rule on its own jurisdiction as well as on objection with regard to the existence or validity of the arbitration agreement is of no consequence as this power is conferred upon the Arbi




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