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IN THE HIGH COURT OF ALLAHABAD
AJIT KUMAR
Fashion World – Appellant
Versus
Banke Bihari Developers Pvt. Ltd. – Respondent
JUDGMENT :
Ajit Kumar, J.
1. Heard Sri Prakhar Saran Srivastava, learned counsel for the petitioners and Sri A.P. Srivastava, learned counsel for the respondents landlord.
2. The petitioner as well as respondents entered a lease agreement styled as ‘Memorandum of Understanding’ on 06th February, 2017 for a period of 9 years on an agreed rent as per Clause 1 of the agreement, with a right reserved with the landlord/lessor vide clause 9 to terminate the lease upon default in payment of rent.
3. Clause 21 of the Memorandum of Understanding prescribed for arbitration under the Arbitration and Conciliation Act, 1996 in the event of any dispute or deference arising out of Memorandum of Understanding. Taking recourse to the Clause 9 of the Memorandum of Understanding lessor/landlord issued a notice to the petitioner to vacate the premises in question. The petitioner upon not being paid rent and taking it to be a case of month to month tenancy instituted a suit for recovery of rent and eviction under Section 15 of The Provincial Small Cause Courts Act, 1887. Petitioner filed miscellaneous application questioning forum on the ground that as per Clause 21 of the Memorandum of Understanding reach
The Supreme Court clarified that unregistered arbitration agreements are not void and emphasized the Referral Court's limited role regarding the enforceability of such agreements.
The main legal point established in the judgment is the enforceability of arbitration agreements in the Tenancy Agreement and the Consolidated Charges Agreement under Section 8 of the Arbitration and....
An arbitration agreement in an unregistered and unstamped lease is not void; issues of stamping must be resolved by the arbitral tribunal, not the civil court.
An arbitration agreement within a lease deed remains enforceable even if the deed is unregistered, reflecting the separability doctrine.
The sufficiency of stamp duty payment rendered the document admissible, and the named arbitrator was disqualified, leading to the appointment of Hon’ble Shri Justice K. K. Lahoti as Arbitrator.
Oral extensions of lease agreements do not sustain arbitration clauses; such clauses require written documentation to remain valid following the lease's expiration.
Courts should minimize intervention in arbitration until awards are pronounced, only assessing arbitrability when objections about document validity arise under the Arbitration Act.
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