IN THE HIGH COURT OF DELHI AT NEW DELHI
RAJIV SAHAI ENDLAW, J.
M/S FORTUNE GRAND MANAGEMENT PVT. LTD. – Appellant
Versus
DELHI TOURISM & TRANSPORT DEVELOPMENT CORPORATION - Respondent
W.P.(C) No.588/2016
Decided on : 25-04-2016
Arbitration Agreement - Dispute Resolution - Public Premises (Eviction of Unauthorised Occupants) Act, 1971 - [Section 18.3 of the Agreement] - The court discussed the interpretation of the arbitration clause in the Agreement and its relationship with the Public Premises Act. It highlighted the exclusivity of the Estate Officer's jurisdiction under the Public Premises Act and the non-arbitrability of disputes falling within its purview. The court emphasized that matters within the jurisdiction of the Public Premises Act are not arbitrable, and the Estate Officer has exclusive jurisdiction over such proceedings.
Fact of the Case:
The petition challenged the initiation of proceedings under the Public Premises Act by the respondent, contending that disputes should be resolved through arbitration as per the Agreement. The respondent terminated the Agreement, leading to parallel proceedings under the Arbitration Act and the Public Premises Act.
Finding of the Court:
The court found that the initiation of proceedings under the Public Premises Act was valid, emphasizing the non-arbitrability of disputes falling within its jurisdiction. It dismissed the petition, stating that the Estate Officer's jurisdiction is exclusive and cannot be bypassed through arbitration.
Issues: The key issue was whether the initiation of proceedings under the Public Premises Act was valid despite the existence of an arbitration clause in the Agreement.
Ratio Decidendi: The court held that disputes falling within the jurisdiction of the Public Premises Act are not arbitrable, emphasizing the exclusive jurisdiction of the Estate Officer under the Act.
Final Decision: The petition was dismissed, and the application for stay of proceedings before the Estate Officer was deemed infructuous and disposed of.
RAJIV SAHAI ENDLAW, J.
1. The petition impugns the proceeding initiated by the respondent in Petition No.1/2016 titled Delhi Tourism and Transport Development Corporation Vs. M/s Fortune Grand Management Pvt. Ltd. before the Estate Officer under the Public Premises (Eviction of Unauthorised Occupants) Act, 1971 (PP Act) on the grounds i) that the Agreement dated 16th August, 2013 between the parties provide for resolution of all disputes by reference to Arbitral Tribunal comprising of three Arbitrators with the petitioner and the respondent appointing one Arbitrator each and the third Arbitrator being appointed by the two Arbitrators; ii) that the petitioner prior to initiation of proceedings under the PP Act had already initiated arbitral proceedings by instituting petitions in this Court under Section 9 and Section 11(6) of the Arbitration and Conciliation Act, 1996 (Arbitration Act) and till the question whether the purported termination of the agreement by the respondent is legal or not, the possession of the petitioner of the premises cannot be said to be unauthorized and two parallel proceedings cannot simultaneously go on; and, iii) that Sh. Piyush Agarwal Estate Officer who has issued the notice is biased / prejudiced having already acted on behalf of the respondent in the dispute with the petitioner by filing a caveat in this Court.
2. The petition came up first for consideration on 27th January, 2016 when the counsel for the respondent appearing on advance notice relied upon International Amusement Ltd. Vs. India Trade Promotion Organization AIR 2015 SC 749. However on a prima facie consideration of the said judgment, the same appeared to be in the context of arbitration clause subject matter of agreement therein and which was found to be materially different from the arbitration clause in the agreement between the parties hereto. Accordingly, the matter was listed for further consideration on 29th January, 2016. On 29th January, 2016, the counsels were heard further on the aspect whether the PP Act would prevail over the arbitration agreement and finding the issue to be a legal one, need for counter affidavit was not felt and judgment was reserved. The petitioner thereafter applied for stay of proceedings before the Estate Officer and which application came up for consideration on 18th March, 2016 when notice of the same was issued though no stay granted.
3. The bid of the petitioner / its predecessor for renovation, operation, maintenance, marketing, management and transfer of Food Court and Shops in Dilli Haat, Pitampura was accepted and an Agreement dated 16th August, 2013 was signed between the parties and where under the respondent granted to the petitioner for a period of 10 years the exclusive right, authority, authorization to plan, operate, allocate, market, maintain and manage the food court, restaurant and shops at Dilli Haat, Pitampura. Clause 18 of the said agreement is as under:
“18. Dispute Resolution
18.1. Dispute resolution
18.1.1. Any dispute, difference or controversy of whatever nature howsoever arising under or out of or in relation to this Agreement (including its interpretation) between the Parties, and so notified in writing by either Party to the other Party (the “Dispute”) shall, in the first instance, be attempted to be resolved amicably in accordance with the conciliation procedure set forth in Clause 18.2.
18.1.2. The Parties agree to use their best efforts for resolving all Disputes arising under or in respect of this Agreement promptly, equitably and in good faith, and further agree to provide each other with reasonable access during normal business hours to all non-privileged records, information and data pertaining to any Dispute.
18.2. Conciliation
18.2.1. In the event of any Dispute between the Parties, either Party may call upon the Chairman of the DTTDC to mediate and assist the Parties in arriving at an amicable settlement thereof. If the Dispute is not resolved as evidenced by
International Amusement Ltd. Vs. India Trade Promotion Organization AIR 2015 SC 749
Natraj Studios (P) Ltd. Vs. Navrang Studios (1981) 1 SCC 523
Ranjit Kumar Bose Vs. Anannya Chowdhury (2014) 11 SCC 446
Central Warehousing Corporation
Ashoka Marketing Ltd. Vs. Punjab National Bank (1990) 4 SCC 406
India Trade Promotion Organisation Vs. International Amusement Limited (2007) 142 DLT 342
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