The power to appoint a Receiver in cases of non-payment of rent and possession of premises should be exercised by the Arbitral Tribunal, and parties should approach the Arbitral Tribunal for appropriate relief.

JUDGMENT

Rajiv Sahai Endlaw, J. - CM APPL. 9203/2021 (of the appellant for exemption)

1. Allowed, subject to all just exceptions and as per extant Rules.

2. The application is disposed of.

FAO (COMM) 63/2021 and CM APPL. 9202/2021 (of the appellant for interim relief)

3. This appeal, under Section 37(2) of the Arbitration and Conciliation Act, 1996 read with Section 13 of the Commercial Courts Act, 2015, impugns the order dated 11th February, 2021 of the Commercial Court on an application for interim measures, under Section 9 of the Arbitration Act, being OMP (COMM) No. 611/2020 preferred by the appellant.

4. We have heard the counsel for the appellant at length.

5. The Arbitration Agreement between the appellant and the respondent is contained in a registered Lease Deed dated 7th March, 2019, for a period of 9 years, executed by the appellant as landlord in favour of the respondent tenant with respect to Flat No. 11, 1st and 2nd Floor, Khan Market, New Delhi. The application under Section 9 of the Arbitration and Conciliation Act, from the order wherein this appeal arises, was filed by the appellant, complaining of non-payment of agreed rent by the respondent tenant and seeking reliefs of, (i) directing the respondent tenant to pay arrears of rent and to continue to pay future rent to the appellant; (ii) appointment of a Receiver to take over possession of the tenanted premises; (iii) direction to the respondent tenant and its directors to file a list of their movable and immovable assets; and, (v) restraining the respondent tenant from alienating, transferring and in any manner creating third party interest in movable and immovable assets including the tenanted premises.

6. The Commercial Court, vide the impugned order, though has granted the reliefs of directing the respondent tenant to pay Rs.25,00,000/- to the appellant landlord and though has restrained the respondent tenant from creating third party rights in the tenanted premises, but has not granted the other reliefs.

7. The appellant, in this appeal, is aggrieved from non-grant of the relief of appointment of Receiver with respect to the premises.

8. The Commercial Court has declined appointment of Receiver, reasoning (i) that there was a dispute between the parties with respect to payment of rent during the national and local lock down owing to the prevalent pandemic; (ii) that the term of tenancy had not expired by efflux of time; (iii) that on opening of the lock down, the restaurant business being carried on by the respondent tenant in the tenanted premises had started picking up; (iv) that the respondent tenant had shown intention to clear the arrears and pay reasonable rent; (v) Arbitrator had already been appointed to adjudicate the disputes between the parties; and, (vi) that there was nothing to indicate that the respondent tenant was acting in a manner so as to defeat the realisation of the monetary award/decree which may be passed by the Arbitrator in favour of the appellant.

9. The contention of the counsel for the appellant is, that once the respondent tenant was in default of payment of rent and had not complied with the directions for payment of rent, appointment of Receiver of the property should have axiomatically followed. Strong reliance is placed on S.C. Mehta Vs. Aviral Kaushik, (2007) 93 DRJ 769, followed in order dated 4th April, 2014 of this Court in OMP 146/2014 titled Asha Dass Vs. Fiorano Motors LLP, both of Single Judges of this Court.

10. In S.C. Mehta supra, the tenant did not comply with the direction for payment of rent issued in exercise of powers under Section 9 of the Arbitration Act and also failed to appear in the Court and his appearance was compelled by issuing bailable warrants; upon such appearance, the tenant gave an undertaking to the Court, to pay the arrears of rent; however he was in breach of that undertaking also and was held guilty of contempt of Court and orders, by the Contempt Court, for attachment of movable and immovable pr