C/IAAP/30/2020 CAV JUDGMENT

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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

R/PETN. UNDER ARBITRATION ACT NO. 30 of 2020

FOR APPROVAL AND SIGNATURE:

HONOURABLE MR. JUSTICE BIREN VAISHNAV

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1 Whether Reporters of Local Papers may be allowed to see the

judgment ?

YES

2 To be referred to the Reporter or not ?

YES

3 Whether their Lordships wish to see the fair copy of the

judgment ?

NO

4 Whether this case involves a substantial question of law as to

the interpretation of the Constitution of India or any order made

thereunder ?

NO

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LIQUIDATOR, THE KARAMSAD URBAN CO OPERATIVE BANK LTD.

Versus

THE SUPRINTENDENT OF POST OFFICES ANAND

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Appearance:

MR PREMAL S RACHH(3297) for the Petitioner(s) No. 1

MUKESHKUMAR B THAKKAR(8079) for the Petitioner(s) No. 1

KSHITIJ M AMIN(7572) for the Respondent(s) No. 1,2

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CORAM: HONOURABLE MR. JUSTICE BIREN VAISHNAV

Date : 29/10/2020

CAV JUDGMENT

1. In this petition filed under Section 11(6) of the Arbitration and

Conciliation Act, 1996, the Karamsad Urban Cooperative Bank

Ltd. (in liquidation) has approached this Court with a prayer that an

independent and impartial person be appointed as a sole arbitrator

to decide the dispute between the parties.

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2. Facts in brief are that the petitioner bank owned certain buildings

which they wanted to give on rent. The respondent no.2 – Post

Master invited tenders on 25.04.1969 for requirement of

accommodation at Karamsad Village for a post office including a

residential house for the post master. The petitioner was one of the

bidders. The bid of the petitioner was found acceptable and

therefore, a lease agreement was entered into between the

petitioner-bank and the Senior Superintendent of Post, Kheda

Division, Nadiad, (now Anand). The lease agreement commenced

from 01.07.1969 with a monthly rent of Rs.200/- for a period of

five years expiring on 30.06.1974.

3. The case of the bank is that on 05.03.1974 before the expiry of

lease, the petitioners demanded increase of rent of Rs.200/- to

300/- which was not paid but the respondents continued to occupy

the premises. On 03.08.1979, the petitioner bank refused to accept

the monthly rent and issued a notice on 21.07.1981 for the

respondents to vacate the premises. Verbal communications were

exchanged, according to the petitioner for increase of rent. On a

joint meeting in February, 1992 between the petitioners and the

respondents, it was agreed that the rent would be payable at the rate

of Rs.3/- per square feet per month amounting to Rs.5544/- per

month from 01.03.1992. According to the petitioners, the

respondents continued to default and therefore a legal notice was

sent on 23.09.1999. On 09.07.2019, the petitioner received a letter

dated 02.07.2019 from the respondents to renew the lease. On

25.07.2019 the petitioners informed that since the bank has gone

into liquidation, the respondents should vacate the premises, unless

they would want to initiate arbitration in accordance with the

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arbitration clause on the lease agreement. On 23.01.2020, the

premises was handed over by the respondents to the petitioner

bank, however, since there was a continued default of payment of

outstanding dues of Rs.1,31,44,016/- of lease rent from 1979 to

1992, the respondents were served a legal notice