N.S.Mittal And Another vs M/S. Ericsson India Private ...
2015 Latest Caselaw 2569 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI

                                     Date of decision: March 26, 2015

+                        OMP No. 641/2012


N.S.MITTAL AND ANOTHER                                   ..... Petitioner

                   Through:           Mr.Vishwa Bhushan Arya,
                                      Advocate
                   versus

M/S. ERICSSON INDIA PRIVATE LIMITED                    ..... Respondent

                   Through:           Mr.Anil Kr. Kher, Sr. Advocate
                                      with Mr.Kunal Kher, Advocate

CORAM:
HON'BLE MR. JUSTICE V.KAMESWAR RAO

V.KAMESWAR RAO, J. (Oral)

1. The challenge in this petition is to the award dated February 29,

2012 (initial award being November 11, 2011) passed by the learned

Arbitrator, whereby the claim of the respondent for refund of security

was allowed with interest and counter claims of the petitioners were

rejected.

2. Brief facts are, the respondent had taken on rent property No. E-

8A, Hauz Khas, Main Market, New Delhi-16 from one Mr. Raj Singh

Gehlot and Mrs.Sheela Gehlot. Mr. Raj Singh Gehlot and Mrs. Sheela

Gehlot sold the property to 18 purchasers and the tenancy rights were

transferred in favour of the purchasers, which included the petitioners

herein. Some disputes arose between the parties in the performance of

terms of lease deed dated August 16, 1995 and a tripartite agreement

dated February 6, 1996, whereby the tenancy rights were transferred

in favour of the petitioners. According to the learned counsel for the

petitioners, they together had purchased, the entire ground floor of the

property. It is not denied that the rent was paid by the respondent to

the petitioners. The lease of the property expired on June 19, 1998.

The respondent company vide its letter dated May 20, 1998 called

upon the petitioners and other purchasers of other floors of the

premises to take back the possession of their respective portion of the

premises on June 19, 1998. It was desired by the purchasers including

the petitioners that they should inspect the premises. The respondent

vide its letter dated June 8, 1998 informed the purchasers that they

may inspect the premises on June 11, 1998. It is the case of the

respondent that during discussions, the purchasers desired that the

respondent demarcate their respective portions in the building prior to

handing over the premises. The respondent did not accept the

proposal. The possession was not handed over nor taken by the

petitioners.

3. As disputes arose between the parties, the respondent herein

filed an application before this Court under Section 11 of the

Arbitration and Conciliation Act, 1996 (Act, in short) for appointment

of an Arbitrator. The respondent herein by way of a separate

application, requested the Court for depositing the key in this Court.

The prayer was allowed and the premises was locked and the key was

deposited with the Registrar of this Court. The application under

Section 11 of the Act was allowed and Justice S.K.Mahajan (Retd.)

was appointed as the learned Arbitrator. The petitioners were also

directed to furnish a bank guarantee to secure the payment of the

security deposit given by the respondent and retained by some of the

purchasers, including the petitioners. As stated above, the claim of the

respondent was for the refund of security deposit with interest. The

counter claims of the petitioners were for the rent till March 2004. The

petitioners had also claimed electricity charges in the sum of

Rs.82,05,759/-.

4. It is the case of the petitioners, that the property having been

damaged and the electricity having been disconnected, they were not

effectively put into possession. It is their case that the liability of the

respondent to pay rent continues till the electricity is restored and the

premises is made habitable. The net revised counter claim of each of

the petitioners was Rs.3,03,28,796/-.

5. The learned Arbitrator framed fourteen issues. The learned

Arbitrator has held that the respondent is entitled to refund of security

deposits of Rs.4,42,837/- with interest @ 9% p.a. in terms of the

award dated February 29, 2012 from both the petitioners. As stated

above, the learned Arbitrator rejected the counter claims of the

petitioners.

6. Learned counsel for the petitioners on a specific query from the

Court, has stated, that the petitioners have settled the issue with the

electricity department by paying an amount of Rs.29,889.56/-. In

other words, the counter claim of the petitioners for Rs.82,05,759/-

would not survive as the petitioners have not paid the said amount to

the electricity department except Rs.29,889.56/-. The learned

Arbitrator framed issue No. 5 with respect to the electricity charges

which reads as under"

"Whether Ericssion is not liable to pay electricity charges upto

March 1, 2004?

7. The learned Arbitrator in this regard was of the view that the

petitioners have not placed on record any evidence to prove that they

had paid electricity charges for restoration of electricity pursuant to

disconnection.

8. The learned counsel for the petitioners would state that the

learned Arbitrator had only considered the restoration charges and not

the actual charges which the petitioners had paid to the electricity

department for the period December 10, 1998 to February 29, 2004.

The answer to this issue would lie in the finding of the learned

Arbitrator as to whether the respondent was holding on to the property

even after December 10, 1998 and did not give physical possession to

the petitioners. The findings in this regard are to the issue Nos. 1 to

3. The said issues are as under:

1. Whether each of the Non-claimants have purchased separate specified portion of the property? Onus on Respondent.

2. Whether tenancy agreement is one composite agreement for whole of the property, if so its effect? Onus on Claimant.

3. Whether Ericsson could not deliver possession of different portion of the properties to individual purchasers? If so to what effect?

9. The findings on the aforesaid issues of the learned Arbitrator are

as under:

"From the narration of facts and documents

mentioned above, it is clear that though the area sold to the respondents by the erstwhile landlord was mentioned in the sale deeds, however, there was no demarcation done at site. It is admitted case of the respondents that even when demarcation was to be done, certain common area had to be left open for use of all other persons who had purchased property from the erstwhile lanadlord. In my opinion, it was not the obligation of the claimant to demarcate the property at site and give separate possession of the portion after such demarcation. Demarcation had to be done only by the respondents themselves independent of the claimant. The claimant could only give possession jointly to all the respondents and it could not deliver physical possession of different portions of the property to individual purchasers. There was one composite agreement of tenancy with the erstwhile owners and specified portions of different owners were not specified at any time. By calling upon all the owners to come and take possession and in case, any one of the respondents had not taken possession on the ground that he should have been delivered physical possession of his portion, claimant cannot be blamed for the same. Respondents no. 10 to 18 had admittedly authorized Mr. Raj Singh Gehlot to take possession on their behalf and Mr. Gehlot after taking possession had issued receipt clearly admitting that the premises had

been vacated by the claimant and that the claimant will not be responsible or liable for any payment of rent or other charges in respect of the premises to any of the co- owners after 19th June, 19998. Issues no.1 to 3 are, accordingly, decided in favour of the claimant."

10. From the perusal of the conclusion arrived at by the learned

Arbitrator to issue Nos. 1 to 3, it is clear that the respondent could not

have demarcated the property at site and give separate possession of

the portion after such demarcation. The learned Arbitrator was right in

holding that the claimant could only give possession jointly to all the

purchasers and could not deliver the physical possession of each

portion of the property to individual purchasers. The learned

Arbitrator was right in holding all the owners should have taken

possession and in case any one of the purchasers had not taken

possession on the ground that he should have been delivered physical

possession of his/her portion, the respondent could not have been

blamed for the same.

11. The learned counsel for the petitioners would counter this

finding of the learned Arbitrator by stating, since the portion of the

property of the petitioners was demarcated i.e. the ground floor, the

respondent could have given the possession without any hitch, which

the petitioners got only on February 29, 2004, the petitioners are

entitled to the rent/electricity charges.

12. Such a submission need to be rejected as the learned counsel for

the petitioners during submissions has conceded that there is only gate

at the ground floor for the whole premises where the lock was put. In

other words, the possession could have been given together to all the

purchasers and not individually. Even otherwise, the petitioners could

have filed an application before this Court, to take possession of the

ground floor. They did not do so. They cannot for their inaction, seek

benefit from the respondent, whose liability, if any, cannot be beyond

December 10, 1998, when the key was deposited in this Court.

13. Learned counsel for the petitioners during the submissions

raised an issue, that the respondent in fact, was using the property

even after December 10, 1998. He placed reliance on the report of

one Ms.Sandhya Saxena, Advocate dated May 2, 2000, who in her

report has referred to the fact that she inspected the site/building

bearing E-8A, Hauz Khas Market, New Delhi and on inspection, she

had found certain articles lying in different floors of the building.

14. He would state, the report revealed that the building was

occupied even after December 10, 1998 by the respondent and

accordingly, the petitioners would be entitled to the rent till February

29, 2004. He would state that the learned Arbitrator has not even

considered this issue. He would pray that to this extent, the matter be

remanded back to the learned Arbitrator for re-consideration.

15. Having noted this submission of the learned counsel for the

petitioners, I am of the view that this request of the petitioners need to

be rejected as he could not able to convince this Court that the claim

raised by the petitioners is liable to be granted. In fact, I note that

Mrs. Sandhya Saxena, Advocate was not even called as a witness to

prove her report. Learned counsel for the petitioners states that the

said report was placed on record by way of an affidavit through one

Mr.Wig. On a pointed query, whether Mr. Wig was produced before

the learned Arbitrator as a witness, the answer was in the negative. In

any case, I am not going into the issue whether Mr. Wig could have

proved the report of Mrs. Sandhya Saxena. Suffice to state, when the

key was deposited with the Registrar of this Court, the lock could not

have been opened. Even otherwise, the petitioners, could have

brought to the notice of this Court the aforesaid position by filing an

application, which they did not do. I am of the view, no case for

remand has been made.

16. I am of the view, the final conclusion of the learned Arbitrator is

justified in the facts, and he has rightly rejected the counter claims of

the petitioners. I do not think, it is a fit case where this Court should

interfere in the impugned award.

17. The petition is accordingly dismissed.

(V.KAMESWAR RAO) JUDGE

MARCH 26, 2015 akb