BHAWANI SINGH - (1.) The petitioner is a company incorporate under the Indian Companies Act, 1956 on January 15, 1992 with registered office at New Rajender Nagar, New Delhi and branch office at LJB -38, Antriksh Bhawan, 22, K - G, Marg, New Delhi, Shri Rajpat Sawhney is one of its Director authorised by resolution of the company dated April 7, 1994 to initiate proceedings. Respondent 1 is the State Financial Corporation established under section 3 of the State Financial Corporation Act, 1951. It is a body corporate having perpetual succession and a common seal and as such falls within the definition of "State" as defined under Article 12 of the Constitution of India. Respondent 2, namely, M/s. Himachal Holiday Resorts (P) Ltd is also a company incorporated under the Indian Companies Act, 1956 and owns "Hotel Tragopan" (hereafter the Hotel) situated at Manali, District Kulu, Himachal Pradesh. Syal, resident of R -548, Shankar Road, New Delhi; (ii) Shri Vijay Mehra, son of Shri Dau Dayal Mehra, resident of F/185, Vikas Puri, New Delhi ; (iii) Shri Rajat Sawhney, son of Shri R. C. Sawhney, resident of 28, Rajendra Park, New Delhi, By the same resolution, Shri Rasik Khosla, Managing Director of respondent 2 was authorised to execute the licence deed in favour of the aforesaid persons. Consequently, a licence deed dated October 30, 1991 was executed between respondent 2 through Managing Director Shri Rasik Khosla and Shri Araan SyaJ, Shri Rajat Sawhaey and Shri Vijay Mehra by means of which the Hotel was given on licence basis to these persons for a period of four years and possession thereof was also to be handed over to them. The terms and conditions of the licence were reduced into writing (Annexure C -I) and finally by Annexure D. Apart frdm certain obligations of the petitioner; respondent 2 was not to interfere in any manner in day -today running of the Hotel by the petitioner an d to pay the interest at the rate of 24 per cent per annum to the petitioner in case the possession of the Hotel was not handed over to the petitioner by March 31, 1992. Respondent 2 was responsible to deal with respondent 1 for payment of its loan and interest thereon and the petitioner was under no obligation whatsoever for any such matter between the respondents. The petitioner was entitled to be indemnified by respondent 1, in case it suffered any loss on account of stoppage of work by interference of respondent 1 or any other Government authority. The petitioner was under obligation to meet the running expenses, payment of Sales Tax, Luxury Tax, Telephone, Electricity bills etc. Besides, it was under an obligation not to transfer or assign or sub -let or part with the possession without the previous consent in writing of respondent
(2.) The petitioner was to maintain the Hotel and all its assets including fittings, fixtures, furnitures, furnishings, carpets, amenities, services, crockery, cutlery, glassware, kitchen equipments etc. etc. and to hand over the Hotel and all its assets at the end of licence period to respondent 2 in good condition.
(3.) Licence deed contains an arbitration clause that in case of any dispute or differences which may arise between the parties on any matter, the same would be settled according to the provisions of the Indian Arbitration Act inforce at that time. Among others, the following two conditions also form part of the licence deed: "(i) Yearly instalment of Rs. 9 Lakhs (Rupees Nine Lakhs only) was to be paid by the licensee(s) to the licensor. However, for the first year Rs 4.5 lakhs (Rupees Four Lakhs Fifty Thousand Only) were to be paid before 31st of January, 1992 out of which Rs. 1 5 lakhs (Rupees One Lakh Fifty Thousand Only) were being paid vide (a) DD No. 291106 dated 29 -10 1991 drawn on State Bank of India, Manali for a sum of Rs 1 00 lakhs (Rupees One Lakh Only) (b) DD No. 600436 dated 29 -10 1991 drawn on Punjab National Bank, Manali for a sum of Rs. 50,000 (Rupees Fifty Thousand Only) as the signing amount and the balance of Rs 3.00 lakhs was payable by 15th of January 1991. - (ii) For the next three years the payment was to be made in four (4) equal quarterly instalments commencing from March every year i. e. payment for each quarter was to be made in advance.;