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DELHI HIGH COURT
NEENA BANSAL KRISHNA
Stella Indusstries Ltd. – Appellant
Versus
Vero Moda Retails Private Ltd. – Respondent
JUDGMENT
Neena Bansal Krishna, J. (Oral)--A petition under Section 11(6) of the Arbitration & Conciliation Act, 1996 has been filed on behalf of the petitioner for appointment of an arbitrator.
2. It is stated that the petitioner Company which is the absolute owner of the shop bearing No. GF 67 & 68, Ground Floor, MGF Metropolitan Mall, MG Road, Gurgaon, Haryana entered into a Lease Agreement dated 18th January, 2016 with the respondent. According to the terms of lease, the period of tenancy was six years three months four days w.e.f. 1st April, 2016 with the initial rent being Rs.8,58,400/- per month plus service tax. In terms of the clause 3.2 of the Lease Agreement, the rent was escalated by 15% after every three years. The rate of rent last payable was Rs.11,35,234/- per month plus tax as applicable. An interest free refundable security of Rs.51,50,400/- was given by the respondent at the time of entering into the lease Agreement. Since about March, 2020 after the imposition of lock down due to outbreak of COVID 19, the respondent stopped paying the rent, taxes and the maintenance charges. Even the electricity charges were not paid.
3. A Legal Notice dated 4th August, 2020
The court upheld its jurisdiction to appoint an arbitrator in landlord-tenant disputes based on an arbitration clause, affirming party autonomy in jurisdictional matters despite objections.
Landlord-tenant disputes are arbitrable, and the appointment of an arbitrator cannot be done unilaterally by one party.
The central legal point established in the judgment is the appointment of a Sole Arbitrator in accordance with the arbitration clause, the objection to unilateral appointment, and the agreement betwe....
Appointment of a sole arbitrator under Section 11(6) of the Arbitration and Conciliation Act, 1996 in cases of serious breach of lease terms.
Court emphasized that a party's failure to respond to notices regarding breach of contract leads to the appointment of an arbitrator to resolve disputes, as stipulated by the Arbitration and Concilia....
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