The MOU did not novate the Lease Deeds and the arbitration clause in the Lease Deeds remained applicable. The respondent's failure to appoint an arbitrator within the specified time entitled the petitioner to the appointment of an independent sole arbitrator.

Manmohan Singh, J.

1. By this order, I propose to decide the two petitions being Arb.P. Nos.407/2012 & 408/2012 filed by the same petitioner.

2. The facts in the first petition being Arb.P.No.407/2012 are that the parties entered into three Lease Deeds dated 15th December, 2009, 17th April, 2010 and 6th May, 2011 whereby the respondent agreed to let out to the petitioner the 4th Floor, 1st Floor and 2nd Floor of the premises at 118, Shahpur Jat, New Delhi. The details and description of the said Lease Deeds entered into between the parties are given as under:-

3. As per clause 2 contained in the above three Lease Deeds, the petitioner had deposited with the respondent a total advance deposit of Rs.24,30,000/- on account of refundable security deposits.

4. Similarly, as per the facts stated in another petition being Arb.P.No.408/2012, both the parties had also entered into other two Lease Deeds dated 1st December, 2008 and 1st January, 2009 whereby the respondent agreed to let out to the petitioner Ground Floor and Lower Ground Floor and 3rd Floor of the same premises. The details and description of the said Lease Deeds entered into between the parties are given as under:-

5. As per clause 2 contained in the above two Lease Deeds, the petitioner had deposited with the respondent a total advance deposit of Rs.26,79,600/- on account of refundable security deposits.

6. Clause 8 of the respective Lease Deeds provides that either of the parties to the Lease Deeds had the option to terminate the abovementioned Lease Deeds by giving three months advance notice in writing.

7. The petitioner by way of its letter dated 29th February, 2012 conveyed to the respondent its intention to vacate the abovementioned premises because of business and commercial reasons and had terminated all the five Lease Deeds and promised to hand over the vacant possession of the leased premises to the respondent on 31st May, 2012. A request was made by the petitioner to the respondent to release the total security deposits of Rs.51,09,600/-which includes the security deposits of Rs.24,30,000/- which is the subject matter of Arb.P.No.407/2012 and Rs.26,79,600/-against the premises of Ground Floor & Lower Ground Floor and 3rd Floor which is the subject matter of Arb.P.No.408/2012.

8. By way of letter dated 1st March, 2012, the respondent had acknowledged and accepted the notice of termination of Lease Deeds and inclined to take the vacant possession of the leased premises on 31st May, 2012 and to refund the security deposits within 15 days from taking the physical possession on the said date, as per the case of the petitioner. However, the respondent failed to release the security deposits, as alleged by the petitioner.

9. Thereafter, the respondent entered into a Memorandum of Understanding (MOU) dated 14th March, 2012 with the petitioner in respect of issues related to the termination of all the five Lease Deeds.

10. The petitioner’s case is that pursuant to the terms of the MOU dated 14th March, 2012, the petitioner had approached Mr. Anil Kumar, Manager of the respondent and discussed with him the issue about handing over the vacant possession of the leased premises. However, he had shown reluctance in taking of physical possession of the leased premises for some reasons. Thereafter, Mr. J.S.Arora, Head-Legal Department of the petitioner’s Group Company personally visited Mr. Anil Kumar on 24th May, 2012 and also on 25th May, 2012 and tried to clarify things and make him understand to take back the physical possession of the leased premises on the agreed date. However, Mr. Anil Kumar was still reluctant. Thereafter, Mr. Amit Grover, Manager (Property & Administration), representative of the petitioner again discussed the issue with Mr. Anil Kumar on 26th, 28th, 29th and 30th of May, 2012, but said representative of the respondent refused to take back the physical possession of the property from the petitioner. On 30th May, 2012, the petitioner issued