M/S. MEHEK-E-PUNJAB RETREAT PVT. LTD Vs. ARYAN DHATU PRIVATE LIMITED
LAWS(CAL)-2019-7-44
HIGH COURT OF CALCUTTA
Decided on July 10,2019

M/S. Mehek-E-Punjab Retreat Pvt. Ltd Appellant
VERSUS
Aryan Dhatu Private Limited Respondents

JUDGEMENT

SUBHASIS DASGUPTA,J. - (1.) The impugned order being No.38 dated 19th June, 2018 passed by the learned Civil Judge (Junior Division), 1st Court, Barasat, 24 Parganas (North) staying suit till the award and thereby referring the subject matter in dispute to the arbitrator on the prayer of the defendant/opposite party under Sections 5 and 8 of the Arbitration and Conciliation Act, 1996, in connection with Title Suit No.3 of 2017 is subject of challenge in this revisional application. Admittedly an agreement for leave and licence dated 1st day of December, 2015 was executed between the parties. The agreement contained an Arbitral Clause (Clause 8). The petitioner/licensee filed a suit in the court below (T.S 3 of 2017) praying for declaration of his tenancy right. In the pending suit, the landlord/licensor/opposite party filed a petition under Sections 5 and 8 of the Arbitration and Conciliation Act for making reference to Arbitrator for resolving the dispute pertaining to leave and licence agreement for the presence of the Arbitral Clause, contained in Clause 8, of the agreement. The court below upon seeing the primacy of the Clause 8 contained in the leave and licence agreement referred the matter to Arbitrator staying the suit till the award is passed by the Arbitrator. Learned advocate for the petitioner submitted that the order making reference to Arbitrator was illegal and the pending suit ought not to have been stayed, as the rights of the petitioner could not be determined by the Arbitrator. It was thus proposed by the learned advocate for the petitioner that instead of making reference of the subject mater of dispute to Arbitrator, the court below ought to have adjudicated the matter in controversy between the parties, and further stay was granted making contravention of the provisions of the law.
(2.) Learned advocate for the opposite party/landlord/licensor adverting to the copy of the final award, passed on 30.11.18 by the Arbitrator, submitted most arduously that the instant revisional application had been rendered infructuous, on the ground that the stay of the suit was granted till the award is passed by the Arbitrator. Thus, according to opposite party as soon as the award was passed, the stay order could not be construed to be operative any more. It was the definite stand of the opposite party that the petitioner, now seeking relief with the aid of Article 227 of the Constitution of India had already submitted to the jurisdiction of the Arbitrator after the subject matter in dispute was referred to the Arbitrator by the court below, and after entering appearance, the petitioner challenged the arbitrability of the subject matter in dispute by filing an application under Section 16 of the Arbitration and Conciliation Act, which was rejected by the Arbitrator by order dated 31st October, 2017, holding "43. Since the right of the Respondent, if any, not protected by special Statute of Rent Control this Arbitral Tribunal has the jurisdiction to adjudicate upon the disputes between the parties arising under or not of the said Agreement and there being no embargo under the law discussed above I have no hesitation to hold that this Arbitral Tribunal has jurisdiction to adjudicate upon the disputes between the parties emanating from the said agreement in respect of their rights there under. 44. However, other questions expecting the point of jurisdiction will remain open for contest between the parties at the time of further hearing in this proceeding on the basis of the pleadings filed by the parties and evidence adduced in the matter. 45. This application under Section 16 of the Arbitration and Conciliation Act, 1996, therefore, fails and the same stands dismissed." Upon referring such facts, learned advocate for the opposite party submitted that arbitrability of the subject matter in dispute could not be allowed to be agitated once more, when petitioner had already submitted to the jurisdiction of Arbitrator and participated successfully in the arbitration proceeding.
(3.) Learned advocate for the opposite party further submitted that the petitioner had already challenged the award passed by the Arbitrator under Section 34 of the Act before the appropriate Appellate Authority. It was sought to establish that with the recording of award directing petitioner to be evicted, there left nothing to be adjudicated,, and when the appeal is pending for setting aside the award, the instant revisional aplication not only had been rendered infructuous, but also being without any merits, liable to be dismissed. Learned advocate for the petitioner being inspired by decision, rendered by Apex Court, reported in 2017(7) Supreme 456 in the case of Himangni Enterprises vs. Kamaljeet Singh Ahluwalia submitted that Arbitration and Conciliation Act, 1996 would not apply to tenancy dispute despite existence of Arbitral Clause in the leave and licence agreement. It was thus sought to be established by the petitioner that civil court alone would have the jurisdiction, and the petitioner ought not to have been relegated to the jurisdiction of Arbitrator. The Apex Court in the case referred above, upon consideration of decisions reported in (1981) 1 SCC 523 delivered in the case of Natraj studios (P) Ltd. vs. Navrang Studios and Anr. and (2011) 5 SCC 532 delivered in the case of Booz Allen and Hamilton INC vs. SBI Home Finance Limited and Ors. held that Civil Court alone would have the jurisdiction to decide the tenancy dispute. In both the cases considered by the Apex Court, the reference to Arbitrator under Section 8 was challenged in a pending eviction suit of landlord, what was originally not granted by the court below on the prayer of defendant/tenant.;


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