Submitted for approval:

THE HON’BLE Ms. JUSTICE B.S.BHANUMATHI

1. Whether Reporters of Local Newspapers may be allowed to see the order? Yes/No

2. Whether the copy of order may be marked to Law Reporters/Journals? Yes/No

3. Whether Her Ladyship wish to see the fair copy of the order? Yes/No

___________________

B. S. BHANUMATHI, J

Gist:

Head Note:

Cases referred:

1 (2021) 2 SCC 1

2 C.R.No.5395 of 2016 (O & M), dated: 24.01.2023

3 (2000) 4 SCC 539

4 (2009) 10 SCC 103

5 (2003) 6 SCC 503

6 MANU/AP/0676/2016

7 MANU/AP/2321/2022

8 2024 SCC OnLine TS 1618

9 2023 SCC OnLine Del 7136

10 2015 (3) ALD 608

11 C.R.P. No. 2039 of 2014, dated. 22.08.2014

12 Arb.A./8/2024, dated: 30.01.2024

13 2017 SCC OnLine Hyd 426

14 2022 SCC OnLine AP 888

15 MANU/UP/4807/2024

16 2022 SCC OnLine SC 928

17 (2014) 208 DLT 487

ORDER:

This revision petition is filed under Article 227 of the Constitution of India against the order dated 03.02.2025 dismissing the petition in I.A.No.706 of 2024 in O.S.No.86 of 2024 on the file of the Court of Additional Civil Judge (Senior Division), Kurnool filed by the defendants under Order VII, Rule 11 CPC to reject the plaint.

The respondent / plaintiff filed suit not to evict the plaintiff from the plaint schedule property. The defendants filed I.A.No.706 of 2024 stating that there is an arbitration clause in the lease deed i.e., clause No.17, which states that any dispute in respect of the plaint schedule property shall be referred to arbitrator under the Arbitration and Conciliation Act, 1996 (in short “the Act”), however the plaintiff filed the suit suppressing the said clause, despite being fully aware of it and therefore, the suit is not maintainable and liable to be rejected.

The respondent filed counter opposing the petition and contending that the subject matter of the case being a right in rem, is not arbitrable; that an arbitration clause in a contract does not automatically exclude the jurisdiction of a civil Court and but usually indicates that the parties have agreed to resolve disputes through arbitration; that as the petitioners were disturbing the petition schedule property and trying to evict the respondent from the property, the suit had been filed and an interim order of injunction was obtained against the petitioners, because the present case is not within the scope of the arbitration clause in the lease deed; and that, at the most, such a clause enables the parties to seek the civil Court’s jurisdiction to refer the dispute to arbitrator under Section 8 of the Act.

After hearing both parties, the trial Court dismissed the petition holding that when the terms No.17 and 18 of the lease deed are read together in a pragmatic way keeping in view the decision of the Supreme Court in Vidya Drolia and others Vs. Durga Trading Corporation, 1(2021) 2 SCC 1, it can be safely concluded that the civil Court’s jurisdiction is not ousted and that when no arbitrator had been so far appointed with the consent of the parties, the civil Court certainly has jurisdiction.

Aggrieved by the order, this revision was filed.

The learned counsel for the petitioners submitted that the dispute regarding lease is no more a lis in rem, but a lis in personam and the dispute is arbitrable as held by the Supreme Court in the case of Vidya Drolia (supra). He further referred to the decision of the High Court of Punjab and Haryana in Vinay Chhatwal Vs. Sukhdev Singh and Anr, C.R.No.5395 of 2016 (O & M), dated: 24.01.2023 wherein it was held that a matter of rendition of accounts is arbitrable. In the case of Vidya Drolia (supra), at paragraph No.80, it was held as follows:

“80. In view of the aforesaid, we overrule the ratio laid down in Himangni Enterprises v. Kamaljeet Singh Ahluwalia, (2017) 10 SCC 706 : (2018) 1 SCC (Civ) 82, and hold that landlord-tenant disputes are arbitrable as the Transfer of Property Act does not forbid or foreclose arbitration. However, landlord-tenant disputes covered and governed by rent control legislatio