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2013 Supreme(Del) 347
IN THE HIGH COURT OF DELHI AT NEW DELHI
MANMOHAN SINGH, J.
KARTAR SINGH – Petitioner
versus
M/S MIRKANA ENGINEERING PVT. LTD. – Respondent
ARB.P. No.98/2012
Decided On : APRIL 02, 2013
Dr. Vijendra Mahndiyan, Adv. with Ms. Pallavi Awasthi, Adv.
Mr. Vikas Arora, Adv. with Mr.Mohit Taneja, Adv.
The arbitration agreement is independent of the lease deed and remains valid even if the lease deed is unregistered.
Headnote:
lease deed - Dispute Resolution - Arbitration and Conciliation Act, 1996 - Section 16
Fact of the Case:
The petitioner leased out a plot to the respondent, who vacated the premises before the lock-in period and caused damage. The petitioner sought lease money and damages. The respondent claimed refund of security deposit and denied causing damage.
Finding of the Court:
The court found that there was a controversy between the parties and referred the disputes to arbitration as per the arbitration clause in the lease deed.
Issues: Controversy over lease termination, damage to premises, refund of security deposit, and invocation of arbitration clause.
Ratio Decidendi: The arbitration agreement is independent of the lease deed and remains valid even if the lease deed is unregistered. The court is concerned with the arbitration agreement and the arbitration clause, which should be considered at the appropriate stage by the arbitrator.
Final Decision: The disputes are referred to arbitration under the aegis of Delhi High Court Arbitration Centre.
MANMOHAN SINGH, J.
1. The case of the petitioner is that the petitioner is owner of a plot measuring 4200 sq. yds. located at Khasra Nos.115 and 116, Jagatpur, Wazirabad Road, Delhi-110084.
2. The respondent is the authorized dealer of M/s Tata Motor Limited for passengers vehicles and required space for carrying out its activities such as stockyards/body shop/workshop and as such approached the petitioner to lease out his aforesaid plot for the said purpose.
3. A lease deed dated 29th April, 2009 was entered into between the parties. As per the terms and conditions of the said lease deed, there was a lock-in period of three years and no party was entitled to terminate the said lease prior to expiry of the said period of three years. However, the respondent company vacated the leased premises prior to expiry of lock-in period. Therefore, the petitioner became entitled to claim the lease money for the remaining 16 months from the respondent i.e. `12 lac besides claiming the damage to the property of the petitioner.
4. It is further stated that the respondent vacated the premises and handed over the key of the premises to the son of the petitioner without settling the accounts in full and final settlement. While inspecting the premises, it was noticed by the petitioner that the respondents officials caused substantial damage to the demised premises; the details of which are as under:
(i) Carpet green grass area measuring 110?x247? has been badly damages.
(ii) The boundary walls have been defaced and require the painting and plastering.
(iii) Substantial damage to the sanitary fittings has been caused.
(iv) Entrance ramp has also been damaged by the respondent company?s officials.
5. As per the terms of the lease, the respondent was required to hand over the possession of the premises as per its original condition at the time of creation of the tenancy. The petitioner obtained the detail from the architect who had given his estimate to the tune of `2,13,020/- for repairing of all these works which the respondent was liable to pay to the petitioner.
6. The petitioner thereafter got issued a legal notice dated 24th January, 2011 to the respondent who gave his reply dated 10th March, 2011 but did not agree with the allegation made by the petitioner in its notice.
7. The details of the claims raised by the petitioner are mentioned in para 11 of the petition. The petitioner also got issued a legal notice dated 29th December, 2011 upon the respondent calling upon him to concur within 30 days for the appointment of sole Arbitrator namely Mr. Yatendra Kumar, CA. The respondent despite of receiving the said notice and after lapse of 30 days did not concur with the appointment of sole Arbitrator. Thus, the petitioner has filed the present petition. In the notice for invoking the arbitration clause the respondent was called upon to pay a sum of `12,63,020/- after adjusting the amount of `1,50,000/- deposited by the respondent as interest free security.
8. Notice of this petition was issued to the respondent who filed his reply, inter alia, on the ground that the present petition is not maintainable as the case of the petitioner is based upon lease deed dated 29th April, 2009 which is unregistered and insufficiently stamped and as such cannot be read into nor can be relied upon for any purpose even for the purposes of reading the arbitration clause in the agreement. It is stated by the respondent that the non-registration of the document cannot be relied upon. As the said lease deed is not properly stamped and until deficient stamp duty along with the penalty is paid, the document cannot be looked into and no cognizance of any nature even for invoking the arbitration clause cannot be considered by this Court, in view of the decision rendered by the Supreme Court in the case of S.M.S. Tea Estate Pvt. Ltd. v. Chandmari Tea Co. Pvt. Ltd., 2011 (7) Scale 747. With regard to merit of the case, it is stated by the respondent that the respo
