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IN THE HIGH COURT OF DELHI AT NEW DELHI
Chandra Dhari Singh, J.
Naveen Bathla – Appellant
Versus
M/s Youth Destination & Anr. – Respondents
Arb.P. 102 of 2023
Decided On : 24-03-2023
Arbitration - Rent Dispute - Arbitration and Conciliation Act, 1996, Section 11
Fact of the Case:
The petitioner filed a petition seeking appointment of a Sole Arbitrator for redressal of disputes arising from a Rent Deed. The respondent opposed the petition, citing a violation of Section 10 of the Act.
Finding of the Court:
The court considered the arguments and found it appropriate to appoint an independent Sole Arbitrator to adjudicate the disputes between the parties under the Rent Deed.
Issues: Dispute over appointment of arbitrator, interpretation of Section 10 of the Arbitration and Conciliation Act, 1996
Ratio Decidendi: The court held that an arbitration agreement containing an even number of arbitrators cannot be a basis for invalidating the agreement. It referred to previous judgments to support the interpretation of Section 10 and emphasized the importance of consent of both parties in appointing an arbitrator.
Final Decision: Ms. Radhika Bishwajit Dubey, Advocate, was appointed as a sole arbitrator to adjudicate the disputes between the parties. The parties were directed to appear before the arbitrator within 10 days, and all contentions were kept open.
ORDER
Chandra Dhari Singh, J. (Oral)--The present petition has been filed on behalf of the petitioner under Section 11 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as "the Act") seeking appointment of a Sole Arbitrator for redressal of disputes between the parties qua the Rent Deed dated 16th April, 2019.
2. Learned counsel appearing on behalf of the petitioner submitted that the petitioner is the rightful owner of the premises bearing no. 639, Ground Floor, Dr. Mukherjee Nagar, Delhi-110009 and the respondent No. 1 is a partnership firm and the respondent No. 2 is one of the partners in respondent No. 1 firm.
3. It is submitted on behalf of the petitioner that in order to operate an institute for imparting education, the parties executed a Rent Deed dated 16th April, 2019, for a period of 03 years commencing from 1st May, 2019 and expiring on 30th April, 2022.
4. It has been submitted on behalf of the petitioner that in accordance with Rent Deed, the rent of the property was fixed at Rs.2,75,000/- per month for first year, Rs.2,88,750/- per month for the second year and Rs.3,03,190/- per month for the third year after the deduction of the TDS and exclusive of the payment of water bills, electric bills and GST.
5. It has been submitted that in light of the outbreak of the COVID-19 pandemic, the rent of the property, pursuant to mutual negotiations was reduced and the same subsequently did not increase after the pandemic was over, in accordance with the terms and conditions of the Rent Deed.
6. Learned counsel appearing on behalf of the petitioner submitted that the petitioner vide notice dated 9th June, 2021 intimated the respondents regarding the increment in rent and to clear the arrears of rent pending on the respondent herein towards the petitioner, failing which the petitioner would terminate the said agreement.
7. It has been submitted on behalf of the petitioner that there was no response to the said communication by the respondent. Therefore, the petitioner vide letter dated 14th July, 2021 terminated the Rent Deed and asked the respondent to vacate the above-mentioned property.
8. It has been submitted on behalf of the petitioner that a commercial suit was instituted on behalf of the petitioner bearing CS(COMM) No. 110/2022 before the Rohini Courts, North District, New Delhi which was eventually withdrawn vide order dated 16th September, 2022 due to the presence of the arbitration clause, i.e., clause 12 in the said deed.
9. Learned counsel appearing on behalf of the petitioner submitted that in view of the existence of the arbitration clause, the petitioner in accordance with Section 21 of the Act, invoked clause 12 of the Rent Deed vide notice dated 3rd December, 2022. It is further submitted that the said notice was not replied by the respondent.
10. In view of the foregoing submissions, it has been prayed on behalf of the petitioner that an independent arbitrator may be appointed by this Court to adjudicate upon the dispute arising between the parties.
11. Per contra, learned counsel on behalf of respondent vehemently opposed the averments made in the instant petition and submitted that clause 12 of the Rent Deed dated 16th April, 2019 provides for panel of two arbitrators, which is in violation of Section 10 of the Act.
12. However, the learned counsel appearing on behalf of the respondent fairly conceded that the dispute between the parties is arbitral in nature and has no objection if this Court appoints an independent Sole Arbitrator for redressal of disputes between the parties.
13. Heard the learned counsel for the parties and perused the record.
14. This Court has taken into consideration the arguments advanced on behalf of the respondent and therefore finds it evident to peruse Section 10 of the Act, which reads as follows:
"10. Number of arbitrators.-(1) The parties are free to determine the number of arbitrators, provided that such number shall not be an even number.
(
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