IN THE HIGH COURT OF JUDICATURE AT MADRAS
N. SATHISH KUMAR, J.
3i Infotech Limited, Navi Mumbai - Petitioner
Versus
P. Balasubramanian & Others - Respondent
Original Petition No. 487 of 2015 & Application No. 8404 of 2018
Decided On : 16-07-2019
Arbitration - Lease Agreement - Arbitration and Conciliation Act - Section 34
Fact of the Case:
The claimant filed a petition to set aside an arbitration award related to a lease agreement for office units. The claimant sought to reject the respondent's claims, allow the counter claim, and remit the matter to the Arbitral Tribunal.
Finding of the Court:
The court found that the respondent did not hand over possession of the premises to the claimants as claimed, and the claimants were entitled to arrears of rent, damages, and interest. The court also found that the arbitrators had considered the entire aspects and awarded reasonably based on the evidence and exhibits.
Issues: The issues included jurisdiction of the Arbitral Tribunal, truth and acceptability of claims, possession of demised premises, counter claim, rate of interest, and entitlement to relief.
Ratio Decidendi: The court held that the respondent did not hand over possession as claimed, and the arbitrators had considered all aspects and awarded reasonably based on the evidence and exhibits.
Final Decision: The Original Petition was dismissed, and no costs were awarded.
(Prayer: The Original Petition has been filed under section 34 of the Arbitration and Conciliation Act to set aside the award dated 10.06.2015 passed by the Arbitral Tribunal insofar as it is against the petitioner, reject the claims of the Respondents and allow the counter claim of the petitioner and alternatively remit the matter to the Arbitral Tribunal to decide the issue in accordance with the findings of this Court with costs.)
1. This Original Petition has been filed by the Claimant to set aside the award dated 10.06.2015 passed by the Arbitral Tribunal insofar as it is against the petitioner, reject the claims of the Respondents and allow the counter claim of the petitioner and alternatively remit the matter to the Arbitral Tribunal to decide the issue in accordance with the findings of this Court. For the sake of convenience the parties are referred as per their own rankings before the Arbitral Proceedings.
2. The brief facts of the claimant's case is as follows:
2(a) The claimants are the co-owners of the four office units situated at 7th Floor of the building known as Prince Techno park, Old Mahabalipuram Road, Thoraipakkam, Chennai. They entered into a Lease Agreement tilted as Lease Deed dated 01.08.2007 with M/s. SDG Software Technologies Ltd., on the monthly rent of Rs.11,80,000/- and the monthly rent shall be calculated at the rate of Rs.40/- per sq.ft. to be paid by the Lessee to the Lessors on or before the 7th day of each month in the following manner
Office Unit No.
Name of the owner
Area (in sq.ft.)
Monthly Rent
Security Deposit
701
Mr.B.Balasubramanian
7299
2,91,960/-
35,03,520/-
702
Mr.Prabhakr Jain (50%)
Mrs. Anita Jain (50%)
7325
1,46,500/-
1,46,500/-
17,58,000/-
17,58,000/-
703
Mr.Rajiv Sawhney (50%)
Mr.Kamini Sawhney(50%)
7503
1,50,060/-
1,50,060/-
18,00,720/-
18,00,720/-
704
Mr.Rajv Sawhney (50%)
Mrs.Kamini Sawhney(50%)
7373
1,47,460/-
1,47,460/-
17,69,520/-
17,69,520/-
Total
29500
11,80,000/-
1,41,60,000/-
2.(b) Lease was agreed to commence from 1.10.2007 and the intial lease period will be 3 years i.e., upto 30.09.2010. The said 3 years initial lease period was agreed to be lock in period. After the initial three years lease period after 30.09.2010, the lessee has the option to issue three months advance notice and terminate the lase and hand over the leased premises to the claimants. Originally the Lessee/Respondent company was amalgamated with M/s.SDG Software Technologies Ltd., and the Respondents also made payments to the claimants regularly. The Respondent also undertook to arrange for the remittance of the rents in the loan accounts. Accordingly the Respondent forwarded letters to the banks undertaking to credit the rents into the bank accounts and hand over the vacant and peaceful charge of the leased property to the banks in the event it vacated the premises leased property. The Respondents have always been irregular in making the payment of rent. The Respondent has also paid delayed interest for delay in payment of rents to the 2nd and 3rd Claimants. The Claimants demanded rents by their various letters and the Respondent took a false stand that the lease was terminated and possession was handed over on 30.09.2010 itself. Several demands from the Claimants were failed to evoke any response. Therefore, claim was preferred before the Arbitrator for payment of Rs.6,06,96,548/- and also delivery of possession and various other reliefs.
3. It is the case of the Respondent that there was no formal handing over of the possession by the Claimants to the Respondent. It is his further case that the commencement of the lease was marked by the payment of rents and similarly the termination was by way of written communication followed by the stoppage of payment of rents. It is contended that by letter dated 5.8.
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