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2014 Supreme(Del) 2941
Delhi High Court
Manmohan Singh, J.
Suresh Shah - Appellant
Versus
Tata Consultancy Services Ltd. - Resopndent
Arb. A. No. 14/2014
Decided On : 13-06-2014
For the Respondent:Mr. Suhail Dutt, Sr. Adv. with Ms. Ekta Kapil, Mr. Munindra Dvivedi, Ms. Divya Bhalla & Ms. Preeti Yadav, Advocates.
The court's decision emphasized that the reasonable amount was already secured, and the disputed issue of stamp duty payment was sub-judiced and pending in court, leading to the dismissal of the appeal.
Headnote:
Arbitration and Conciliation Act, 1996 - Interim Relief - Stamp Duty - Rent - [SECURITY OF AMOUNT] - [LEASED PROPERTY DISPUTE] - [Section 17 of the Arbitration and Conciliation Act, 1996] - The judgment discusses the appellant's appeal against the order passed by the learned Arbitrator in the application filed under Section 17 of the Arbitration and Conciliation Act, 1996. The appellant sought interim reliefs against the respondent, including securing the outstanding rent and stamp duty liability. The court analyzed the issues of securing the amount, payment of rent, and stamp duty liability, and concluded that the appellant's contentions were not justified. The court found that the reasonable amount was already secured, and the disputed issue of stamp duty payment was sub-judiced and pending in court. The appeal was dismissed.
Fact of the Case:
The appellant filed an appeal against the order passed by the learned Arbitrator in the application filed under Section 17 of the Arbitration and Conciliation Act, 1996. The appellant sought interim reliefs against the respondent, including securing the outstanding rent and stamp duty liability. The main grievance of the appellant was that the interim reliefs were necessary as the respondent had proceeded to terminate the sub-Lease Deed and was in the process of vacating the premises without paying the agreed rent or discharging the stamp duty liability. The appellant argued that it was difficult for them to locate a new tenant without securing permission from the Noida Authority due to the pending demand and non-discharge of liability by the respondent regarding the stamp duty.
Finding of the Court:
The court found that the reasonable amount on the issue of securing the amount was already secured, and the disputed issue of stamp duty payment was sub-judiced and pending in court. The court concluded that the appellant's contentions were not justified, and the appeal was dismissed.
Issues: The issues included securing the outstanding rent and stamp duty liability, payment of rent, and the disputed issue of stamp duty payment, which was sub-judiced and pending in court.
Ratio Decidendi: The court found that the reasonable amount was already secured, and the disputed issue of stamp duty payment was sub-judiced and pending in court. The court concluded that the appellant's contentions were not justified, and the appeal was dismissed.
Final Decision: The appeal was dismissed.
Manmohan Singh, J.:--
1. The appellant has filed the present appeal against the order dated 16th April, 2014 passed by the learned Arbitrator in the application filed by the appellant under Section 17 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “the Act”) in the arbitration proceedings bearing case reference No. DAC/522/01-14 pending between the parties.
2. Brief facts for the purpose of deciding the present appeal are that the property bearing No. 154-B, Block-A, Sector 63, Gautam Budh Nagar, Noida (“the said property”) was allotted and leased by Noida Authority to AARDEE Fashions Pvt. Ltd. which was transferred to Ms. Pooja Arora who subsequently transferred the said property to Sun Light Buildcon Pvt. Ltd. (SBPL) with the permission from the Noida Authority. Vide a sub-lease deed dated 29th September, 2007, SBPL leased the said property to the respondent (TCS) with the prior permission from the Noida Authority. Vide a letter of Attornment dated 19th April, 2011, SBPL transferred all the rights and liabilities under the sub-lease deed to the appellant except for the amendments contained in the said letter of attonrment.
3. The appellant filed a petition under Section 9 of the Act, inter alia, seeking direction against the respondent to furnish a bank guarantee to secure the outstanding rent based on the ‘area’ and rent agreed under the sub-lease-deed and on the issue of protection in respect of stamp duty, as according to the appellant, the respondent failed to pay the lease rental for a period of 9 months from April to December, 2013, by raising the disputes that the sub-leased area is not 1.75 lakh sq. ft. but it is 1.35 lakhs sq. ft. as indicated in the Occupancy Certificate and secondly, it is for the lessor/appellant to pay stamp duty liability, being demanded by authorities.
4. In the petition under Section 9 of the Act, the appellant sought following reliefs against the respondent:
“(a) Direction to pay Rs. 12,34,47,210/- as arrears of rent from quarter April-July, 2013 to the quarter October-December, 2013 with interest thereon at 12% per annum from the due date till date of realization;
(b) Direction to pay rent in terms of clause 7(a) of the sub-lease deed dated 29.9.2007 during continuation of the lease;
(c) Direction to respondent to settle/pay the liability arising on account of stamp duty, interest and penalty in respect of the Deed of Sub-lease dated 29.9.2007, demanded by NOIDA as per its final notice dated 12.2.2013; and
(d) A declaration that liability for payment of stamp duty as demanded by NOIDA by notice dated 12.2.2013 in respect of Deed of Sub-lease dated 29.9.2007 as amended, is solely on the respondent.”
5. By order dated 20th December, 2013, the Court disposed of the Section 9 petition with certain agreed directions, which inter alia included the following:
“(i) The respondent will furnish a bank guarantee, favouring the Registrar General of this Court qua the outstanding lease rent (based inter alia on the provisions of the lease deed which would include the rate and the area indicated therein).
(ii) The lease rent for the period January, 2014 and thereafter, shall be paid by the respondent for an area equivalent to 1,35,000 sq. ft. in accordance with the provisions of the lease obtaining between the parties.
(iii) The petition (under Section 9) shall be placed before the learned arbitrator, who will treat the same as an application under Section 17 of the Act.”
6. The application filed by the appellant for interim measures i.e. the petition filed under Section 9 of the Act before this Court treated as an application under Section 17 of the Act in the arbitration proceedings was heard on 22nd February, 2014. The appellant filed another application dated 1st April, 2014 stating that the sub-lease in its favour has been terminated by the respondent as per notice of termination dated 31st March, 2014 on the expiry of six months from 1st April, 2014. By the said application,
