The main legal point established in the judgment is the binding nature of the terms in Ex.C4 and the limited scope of Section 34 of the Arbitration and Conciliation Act, 1996.

JUDGMENT

(Prayer: Appeal filed under Section 36 of Arbitration and Conciliation Act, 1996 read with Clause 15 of the Letters Patent Act, to set aside the fair and dccreetal order dated 21.11.2017 passed by this Court in O.P.No.253 of 2017.)

T.V. Thamilselvi

1. Challenging the fair and decreetal order passed in O.P.No.253 of 2017 dated 21.11.2017, the appellant has filed the above Original Side Appeal.

2. The Brief facts of the case are as follows:-

(i) The appellant filed the original petition under Section 34 of the Arbitration and Conciliation Act, 1996, to set aside the award dated 11.11.2016 passed by the Sole Arbitrator.

(ii) According to the respondent/claimant company, they are well reputed operator in South India, operating hotels, restaurants, eateries and also operating several 'food courts' at 'I.T. Parks' in and around Chennai. The respondent/claimant and the appellant entered into a Term Sheet dated 23.10.2007 and as per the Term Sheet, the respondent/claimant would establish the food courts at I.T Park proposed to be established by the appellant at Navaloor Village, Chengalpet, Kancheepuram District.

(iii) After entering into the Term Sheet dated 23.10.2007 (Ex.C1), both the parties entered into a lease deed on 18.01.2008, for the lease of the area to be operated as a food court by the appellant and the lease commenced from 15.04.2008, which expressly provided that the monthly rent was payable only after certain conditions were met. The appellant did not hand over the premises as per the time agreed between the parties. Therefore, the respondent issued a notice on 30.07.2008, terminating the Term Sheet dated 23.10.2007 as the IT park was not functional and therefore, called upon the appellant to refund the security deposit of Rs.1,00,00,000/-(Rupees One Crore only) along with an interest at the rate of 18% from the date of payment. Representatives of the appellant/ company approached the respondent/claimant and there was discussion between the parties pursuant to the termination notice dated 30.07.2008 (Ex.C3). The appellant had represented that after completing various works at the site, there will be more than 4000 employees would be employed at the IT Park and a short time may be given to them to complete the works. Based on the representations and in the light of the revised terms agreed between the parties, the respondent company withdrew its termination of the Term Sheet dated 23.10.2007 by way of its letter dated 30.07.2008. The key terms promised and represented by the appellant were recorded in the letter dated 13.08.2008 (Ex.C4) and sent by the respondent to the appellant. The modified arrangement between the parties in the letter dated 13.08.2008 (Ex.C4) are as follows

'a) The claimant would not have to pay and rent and maintenance until the claimant actually started the operations of the food court;

b) As the food court operations depended on the number of employees, the Claimant would be required to start operating the food court only after the confirmation was received from the Respondent that there were 4000 employees permanently working at the premises of the I.T Park.

(c) After the confirmation of the fact that 4000 employees were permanently working at the IT Park, then, the Claimant would have 4 months time to carry out all the fitouts and establish the food court and that such 4 months period would be a rent free period.

(iv) Thus, Ex.C4 has reference to the assurance said to have been given by the appellant. Even after the receipt of the Ex.C4 letter, the appellant failed to comply with the assurance given by them and also the terms and conditions mentioned in Ex.C4. Hence, the respondent/claimant issued a legal notice dated 18.07.2009 (Ex.C5), calling upon them to refund the security deposit amount of Rs.1,00,00,000/-(Rupees One Crore only) with interest. The appellant did not return the security deposit amount and therefore, the respondent/claimant has initiated arbitration