A party cannot claim interim relief under Section 9 of the Arbitration Act if it failed to fulfill its contractual obligations, particularly regarding rental payments.

JUDGMENT

1. A petition under Section 9 of the Arbitration & Conciliation Act, 1996 (hereinafter referred to as "the Act") for seeking ad-interim injunction against the respondent from acting upon the Termination Notice dated 27th September, 2022 and to desist from making any direct communication with the petitioner's sub-tenants.

2. The petitioner executed a Lease Deed dated 22nd May, 2019 with the respondent for the commercial property in respect of the front portion of the fifth floor of Industrial Plot No.445, Phase-V, Udyog Vihar, Gurugram, Haryana, (hereinafter referred to as "the leased premises"). The petitioner's business model involved leasing out commercial properties on long term lease permitting further sub-lease of the property to prospective sub-tenants at a higher rental by refurbishing the property and providing fully customized commercial space as per the specifications and requirements of its clients/sub-tenants.

3. It is submitted that the respondent is the absolute owner of the leased property and after rounds and negotiations and discussions, the parties entered into the Lease for a period of five years commencing from 01st June, 2019. The lock-in period was of five years from the rent commencement date, renewable on mutually agreed terms. Accordingly, the lease premises were given to the petitioner, who undertook heavy expenditure in refurbishing the leased premises. A total sum of Rs.2,46,54,519/- has been invested by the petitioner on the representations of the respondent.

4. One of the mandatory preconditions under the Lease Deed was for the respondent to obtain an Occupation Certificate (OC) within thirty days plus grace period of 15 days from the execution of the Lease Agreement. However, the OC has not been procured putting the petitioner under high risk due to the Indemnification Clause contained in the sub-leases executed by it with the sub-tenants.

5. It is asserted that the payment obligation of the petitioner was subject to the fulfilment of the obligations by the respondent. Since it failed to procure OC, it was not entitled to raise invoices nor were they ever raised in respect of fifth floor.

6. Furthermore, the respondent had taken a portion of leased premises to be used by it for its own office space. The petitioner has claimed that it has invested about Rs.46,19,409/- in developing the office space of the respondent on the fifth floor despite for which it was under an obligation to make payment dehors the payment obligations of the petitioner under the Lease Deed. However, the respondent never paid any rent/maintenance charges for the usage of office space for its personal use which was developed by the petitioner.

7. Despite the mutual agreement, respondent vide Letter dated 25th September, 2020 illegally demanded payment of rent from February, 2019 even though the rent commencement date was 01st June, 2019 as per the Lease Deed. Furthermore, the demand was made by the respondent at a belated stage of almost one year after the execution of the Lease Deed and the said letter was totally misplaced. The Notice further averred that obtaining the OC was not material as the petitioner had allegedly occupied the fifth floor premises. The respondent also threatened to approach the subtenants directly in case of non compliance of the Notice.

8. The petitioner replied to the respondent in July, 2021 and reiterated that the liability to pay the rent shall not commence in view of recital B of Lease Deed providing that OC and Property Tax Receipt were the mandatory preconditions to initiate rentals under the Lease Deed. Also the Maintenance Charges payable by the respondent had not been paid since 2019.

9. The petitioner received a Letter dated 15th September, 2021 from the respondent informing that the Property Tax has been paid and the OC obtained. However, no OC was ever shared with the petitioner.

10. It is asserted that the respondent served upon the petitioner a Termination