Arbitration agreements are independent of the main contract's validity; issues regarding non-stamping and enforceability must be resolved by the arbitrator.

JUDGMENT

1. This is a petition under Section 11 of the Arbitration and Conciliation Act, 1996 ("the 1996 Act").

2. Vide the unregistered licence agreement dated 22nd October, 1998, the respondent was inducted by the petitioner as a licensee in respect of three shops located at 24, Patel Road, West Patel Nagar, Market Side, New Delhi.

3. The petition asserts that the petitioner, as licensor, was entitled to terminate the license agreement at his absolute option.

4. On 21st October, 2019, the petitioner served a legal notice to the respondent, revoking the license in respect of the aforesaid three shops and calling on the respondent to hand over peaceful and vacant possession thereof, or to pay user or occupation charges in default. This was followed by a notice dated 21st December, 2019, whereby the petitioner invoked clause xiv in the license agreement, which reads thus:

"xiv) xxx

It is hereby further declared that every or any dispute, difference or question which, may at any time arise between the parties hereto, touching or arising out or in respect of this agreement, or the subject matter thereof whether during the continuance of the Agreement or after is determination in any manner, shall be referred to the Arbitration of any person mutually agreed by the Licensor and the Licensee and the decision of the Arbitrator shall be binding on both the parties."

5. The petitioner submits that despite having invoked the arbitration clause vide notice dated 21st December, 2019, the respondent did not participate in the exercise of appointing the arbitrator, resulting in the petitioner having to approach this Court.

6. The respondent has filed a reply to the petition.

7. Though the respondent does not dispute the existence of the arbitration clause or the arbitrability of the dispute per se, it is asserted that the licence agreement is an unregistered document and that, therefore, no rights could be claimed by the petitioner thereunder and that, therefore, it could neither be enforced nor could any right be claimed by the petitioner thereunder. As such, it is submitted that, even if an arbitrator were to be appointed, the arbitral exercise would be abortive.

8. Learned counsel for the respondent relies, in this context, on the judgment of the Supreme Court in SMS Tea Estates Pvt. Ltd. v. M/s Chandmari Tea Co. Pvt. Ltd., (2011) 14 SCC 66.

9. Mr. Wadhwa, learned counsel for the respondent, very fairly acknowledges that, even in this case, the Supreme Court had held that the arbitration agreement, being in the nature of a separate agreement though ensconced within the "main" agreement, existed separately and that, therefore, any infirmities attaching to the main agreement would not invalidate the arbitration agreement or impact its enforceability. Even so, he points out, the Supreme Court went on to notice that, as the agreement was unregistered, no rights could have been claimed thereunder.

10. As such, learned counsel submits that even if this petition were to be allowed, the learned arbitrator could not rely on the licence agreement as a basis to award any claim to the petitioner.

11. The issue raised by Mr. Wadhwa falls entirely outside the periphery of consideration of this Court exercising jurisdiction under Section 11 (6) of the 1996 Act, in view of Section 11 (6A) thereof, read with the judgment of the Supreme Court in Vidya Drolia v. Durga Trading Corporation, 2020 SCC OnLine SC 1018.

12. The existence of the arbitration agreement is not in dispute.

13. The issue of whether the licence agreement could be enforced or whether any rights could enure