Gujarat High Court
Tata Aia Life Insurance Company Ltd. ... vs Sujay Pankajbhai Shah (Huf) on 4 September, 2025
Author: Sunita Agarwal
Bench: Sunita Agarwal
NEUTRAL CITATION
C/FA/3100/2025 ORDER DATED: 04/09/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 3100 of 2025
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2025
In R/FIRST APPEAL NO. 3100 of 2025
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TATA AIA LIFE INSURANCE COMPANY LTD. (FORMERLY KNOWN AS
TATA AIA LIFE INSURANCE COMPANY LTD.)
Versus
SUJAY PANKAJBHAI SHAH (HUF) & ANR.
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Appearance:
MR ZALAK B. PIPALIA, ADVOCATE FOR MR VISHAL C MEHTA(6152) for
the Appellant(s) No. 1
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CORAM:HONOURABLE THE CHIEF JUSTICE MRS.
JUSTICE SUNITA AGARWAL
and
HONOURABLE MR.JUSTICE D.N.RAY
Date : 04/09/2025
ORAL ORDER
(PER : HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE SUNITA AGARWAL)
1. There is a leave note filed by learned advocate Mr. Vishal C. Mehta. However, Mr. Zalak Pipalia, learned advocate has put in appearance to submit that he has instructions to argue the matter. We, therefore, proceeded with the matter.
2. This is an appeal under Section-37 of the Arbitration and Conciliation Act' 1996 [in short referred to as "The Act' 1996"] challenging the award dated 22.02.2016 which has Page 1 of 6 Uploaded by A. B. VAGHELA(HC01079) on Tue Sep 09 2025 Downloaded on : Tue Sep 09 22:12:22 IST 2025 NEUTRAL CITATION C/FA/3100/2025 ORDER DATED: 04/09/2025 undefined been affirmed with the dismissal of the application under Section 34 of the Act' 1996 by judgment and order dated 09.05.2025.
3. Assailing the correctness of the award, learned counsel for the appellant made submissions on the merits of the award. However, the fact remains that the dispute referred to arbitration arose out of a lease agreement dated 05.09.2008, wherein the tenure of the lease was fixed for 06 years with effect from 25.07.2008. The lease period, thus, had expired on 24.07.2014. In the meantime, the lease property was sold to the respondents on 06.09.2011 by way of a registered sale- deed. The appellant lessee raised a dispute with regard to the payment of lease rent on the premise that he had given a notice dated 16.07.2012 to the lessor intimating that he wanted to vacate the lease premises after the locking period of 03 years, as per the lease-deed, was over. The dispute was raised with regard to the service of notice dated 16.07.2012 sent through UPC [Under Postal Certificate].
4. The submission of the learned counsel for the appellant is that though the service of notice dated 16.07.2012 sent Page 2 of 6 Uploaded by A. B. VAGHELA(HC01079) on Tue Sep 09 2025 Downloaded on : Tue Sep 09 22:12:22 IST 2025 NEUTRAL CITATION C/FA/3100/2025 ORDER DATED: 04/09/2025 undefined through UPC could not be proved, but the fact remains that no dispute could be raised before the Arbitrator of two other notices served through E-mail dated 03.08.2012, 08.09.2012 and the reminder letter sent on 26.10.2012. The contention, thus, is that after sending the said notices, the appellant asked the lessor to refund the security deposit which was not acceded to and hence, the appellant invoked arbitration clause to initiate arbitration proceedings. The contention is that the arbitrator has erred in allowing the counter claim though the breach was on the part of the lessor.
5. Considering the above, suffice is to note that a finding of fact has been returned by the learned arbitrator to the effect that the appellant/ original claimant had not paid the lease- rent for the use and occupation of the lease premises even after 24.07.2014, when he continued to occupy the lease premises beyond the period of lease. The damages and compensation has, thus, been awarded by the learned Arbitrator besides the dues towards the lease-rent and the electricity charges which remained unpaid during the period of occupation. The operative portion of the award reads as under:-
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NEUTRAL CITATION C/FA/3100/2025 ORDER DATED: 04/09/2025 undefined "(1) The claim petition of the claimant insurance company is rejected and the claim of the claimant is also rejected.
(2) the counter claim of the respondents is allowed. The claimant is directed to pay the amount of Rs.18,62,636=00 for arrears of rent, service tax and electric charges to the respondents. The claimant is also directed to pay compensation of Rs.27/- Lacs for the wrongful retention of the premises in question from 25/07/2014 till the date of this award and is further directed to continue to pay the compensation at the rate of Rs.1,50,000/- per month from the date of this award till the possession of the premises in question is handed over to the respondents. This total amount shall be payable within three months from the date of this order and if not paid, the same shall be payable with interest at the rate of 10% p.a. from the date of award till the amount is paid.
(3) The claimant is further directed to hand over vacant possession of the premises admeasuring 8975 sq.ft. On the First Floor bearing No.1, 2, 3 of the building known as "Wide Angle" situated at Nagalpur, Tal. Mehsana on Ahmedaband-Mehsana Highway to the respondents within three months from the date of this award.
(4) The claimant is also directed to bear the cost of this arbitration proceedings and shall pay the cost to the respondents. The cost is quantified at Rs.30,000/-."Page 4 of 6 Uploaded by A. B. VAGHELA(HC01079) on Tue Sep 09 2025 Downloaded on : Tue Sep 09 22:12:22 IST 2025
NEUTRAL CITATION C/FA/3100/2025 ORDER DATED: 04/09/2025 undefined
6. The Court under Section-34 proceedings has rejected the application noticing that the dispute raised before it was beyond the scope of Section 34 of the Arbitration and Conciliation Act' 1996.
7. Taking note of the above, on a query made by the Court as to whether the physical possession of the lease property has been handed over by the appellant to the lessor, it is submitted by the learned advocate for the appellant that the appellant - lessee is still in the occupation of the lease premises and neither the awarded amount towards lease rent etc has been paid nor even the current rent of the lease premises is being paid to the lessor.
8. Taking note of the above, finding that the appellant has no right to occupy the lease premises beyond the period of lease, moreover, there was no stay to the arbitral award in the proceedings under Section 34 of the Arbitration and Conciliation Act' 1996 and further for the fact that the appellant has not paid lease rent since after 24.07.2014, when the lease period had expired, we dismiss the present appeal outrightly.
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NEUTRAL CITATION C/FA/3100/2025 ORDER DATED: 04/09/2025 undefined
9. However, in addition to the amount awarded by the learned Arbitrator, looking of the conduct of the appellant, we dismiss the present appeal with the cost of Rs.10,00,000/- [Rupees Ten Lac Only], which shall be deposited with the Registrar General of the High Court within a period of three weeks from today. The deposits so made shall be transmitted to the Executing Court for payment to the lessor in the execution of the award.
Consequently, the pending Civil Application would not survive and is disposed of, accordingly.
(SUNITA AGARWAL, CJ ) (D.N.RAY,J) A. B. VAGHELA Page 6 of 6 Uploaded by A. B. VAGHELA(HC01079) on Tue Sep 09 2025 Downloaded on : Tue Sep 09 22:12:22 IST 2025