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IN THE HIGH COURT OF DELHI AT NEW DELHI

Reserved on : 28^th March, 2008

Date of Decision : 4^th April, 2008.

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OMP NO.183/2008

M/S EXCLUSIVE MOTORS PVT. LTD.

..... PETITIONER

Through Mr. A.S. Chandiok, Sr. Advocate with Mr. Ravi Gupta,

Mr. Ankit Jain, Ms. Yashodhara and Ms. Benu Sodhi, Advocate.

versus

M/S INDIA TOURISM DEVELOPMENT ..... DEFENDANT

Through Mr. Rajiv Nayyar, Sr. Advocate with Mr. Sushant Kumar,

Mr. Kaustubh Sinha and Ms. Shreya Sharma, Advocate.

CORAM: MR. JUSTICE S. RAVINDRA BHAT

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 the judgment should be reported

in the Digest?

Yes

S. RAVINDRA BHAT, J.

1.

In this proceeding, under section 9 of the Arbitration and Conciliation Act, 1996 –

(hereafter called the Act), a direction to restrain the respondents with an ad interim order from

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taking forcible possession of suit premises, which is a 5248 sq. ft. space situated at the lower

ground, located in Hotel Samrat, (hereafter called “ the suit premises”) are claimed. The

petitioner also seeks suspension of the operation of a letter dated 8 January 2008 and directions

that the respondents, their employees agent etc should carry out necessary repairs for stopping

the seepage and leakage of water in various portions of the suit premises.

2.

The brief facts necessary for deciding this case are that after negotiations between the

parties, the respondent agreed to let out on license basis, the suit premises to the petitioner, for

use as a world-class showroom for luxury cars, so as to feed a "high class clientele". The

respondent informed the petitioner that its competent authority had approved letting out the area

of approximately 5200 sq.ft @ Rs. 50 per square feet, per month, excluding taxes, if applicable

and electricity charges. The offer was initially valid for three years but renewable for another

three years subject to the condition that the showroom is a "high profit clientele" and of world

class standards. The parties entered into an agreement on the 18th of December 2004.

3.

The petitioner relies on some of the conditions in the agreement such as Clause 4 which

stipulates that the license agreement is renewable by the licensor, namely the respondent on

expiry of the period stipulated in clause 3 subject to the showroom being high-profile clientele

and world class standard and on existing terms and conditions. The same condition also went

further to state that the duration of each extended period would not be for a more than three years

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for each such extension and that at the time of each such a renewal or extension, the parties were

to execute a fresh license deed, for the premises, licensed, on the same terms and conditions, the

licensee had to apply for renewal three calendar months before the expiry of license. Clause 5

stated that at the time of each such renewal, the licensee was to a fresh license deed for the

premises and in case the licensee failed secure renewal of the licence for the period, on the

expiry of the licensed deed, the licensee was to be considered to be in unauthorized occupation

of the space, leaving the licensor with liberty to initiate proceedings under the due process of

law. Clause 11 stipulated that during currency of the licence, if the licensee required any

structural alterations to the premises including that of its frontage, for purpose of his business, he

was to request, in writing, to the licensor to carry out such alterations at the cost of the licensee.

The licensor had the absolute right to carry out any external renovation work during the term of

the licence period. The licensee, under clause 12, had to get the space organized and carry out

the interior decoration of the premises at its cost after gett