Delhi High Court
Ms Sital Dass Jewellers & Anr. vs Asian Hotels (North) Ltd. on 6 August, 2021
$~22 to 25 & 56 to 59
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision: 06.08.2021
(i) + ARB.P. 661/2021
M/S SITAL DASS JEWELLERS & ANR.
(ii) + ARB.P. 665/2021
M/S J.H. JEWELLERS & ANR.
(iii) + ARB.P. 667/2021
M/S SITAL DASS SONS & ANR.
(iv) + ARB.P. 668/2021
ABHUSHAN & ANR.
(v) + O.M.P.(I) (COMM.) 244/2021
M/s SITAL DASS SONS & ANR.
(vi) + O.M.P.(I) (COMM.) 245/2021
ABHUSHAN & ANR.
(vii) + O.M.P.(I) (COMM.) 248/2021
M/s SITAL DASS JEWELLERS & ANR.
(viii) + O.M.P.(I) (COMM.) 249/2021
M/s J.H. JEWELLERS & ANR. ....Petitioners
Through: Mr. P.K. Agrawal, Mr. Rishabh
Tomar & Ms. Sukriti Sinha,
Advocates
Versus
ASIAN HOTELS (NORTH) LTD. ..... Respondent
Through: Mr. Sidhant Kumar & Ms. Manyaa
Chandok, Advocates
ARB.P. 661; 665; 667 & 668 of 2021 Page 1 of 9
O.M.P.(I) (COMM.) 244; 245; 248 & 249/2021
CORAM:
HON'BLE MR. JUSTICE SURESH KUMAR KAIT
J U D G M E N T (oral)
The hearing has been conducted through video conferencing.
1. The above captioned first four petitions have been preferred under
Section 11(6) of Arbitration and Conciliation Act, 1996 seeking
appointment of Arbitrators for adjudication of disputes between the parties.
2. Since the relief sought by the petitioners in these petitions is more or
less similar against a common respondent, therefore, with the consent of
counsel for the parties, these petitions have been heard together and are
being disposed of by this common order.
3. Petitioner No.1 in the above captioned first petition [ARB. P.
661/2021] is a proprietorship firm at L-81, Shopping arcade, Hotel Hyatt
Regency, Bhikaiji Cama Place, New Delhi and petitioner No.2 is the
proprietor.
4. In the third captioned petition, [ARB. P. 667/2021], petitioner No.1 is
a partnership firm and petitioner No.2 is the partner of the firm, who are
having their office L- 79, Shopping arcade, Hotel Hyatt Regency, Bhikaiji
Cama Place, New Delhi.
O.M.P.(I) (COMM.) 244; 245; 248 & 249/2021
5. Petitioner No.1/firm in first captioned petition and third captioned
petition are similar. According to petitioner firm, on 01.09.1982 a license
agreement along with a supplementary agreement was entered between
petitioner (previously known as M/s Virender Kumar & Co.) and respondent
in respect of shops in question, which was renewable every five years at the
option of petitioner. The case of petitioner is that after change of name of
petitioner/firm from M/S Virender Kumar & Co. to M/S Sital Dass Sons, an
additional space adjacent to shop L-79 viz L-79 Extn. (Renumbered as L-81)
(273 sq. ft.) in the same shopping arcade was granted by the respondent to
M/S Sital Dass Sons vide supplementary agreement dated 10.08.1984 and
the terms of original license agreement dated 01.09.1982 were to be read
along with agreement dated 10.08.1984. Vide letter dated 01.01.1992, M/S
Sital Dass Sons through its partners informed the respondent that they shall
be operating under two different names i.e. M/S Sital Dass Sons represented
by Rajendra Kumar Rakyan in shop No. L-79 ( 490 sq. ft.) and the other
represented by Mr. Jitendra Rakyan in shop no. L-79 Extn. (Renumbered as
L-81)(273 sq. ft.).
6. In the second petition [ARB. P. 665/2021], petitioner No.1 is a
partnership firm and petitioner No.2 is the partner of the firm, at L-73,
O.M.P.(I) (COMM.) 244; 245; 248 & 249/2021
Shopping arcade, Hotel Hyatt Regency, Bhikaiji Cama Place, New Delhi.
Petitioner No.1 had entered into a license agreement as well as
supplementary agreement, both dated 09.09.1992, with respondent in respect
of shop in question, which was renewable every five years at the option of
respondent, who had further vide letter dated 0 1.04.1996 transferred the
ownership of the said shop from petitioner No.1 to petitioner No.2.
7. In above captioned fourth petition [ARB. P. 668/2021], petitioner
No.1/firm who was earlier a partnership firm, by virtue of a dissolution deed
dated 01.04.2015, became a sole proprietorship firm and petitioner No.2 as
the sole proprietor, at L-78, shopping arcade, Hotel Hyatt Regency, Bhikaiji
Cama Place, New Delhi. In respect of shop in question, a license agreement
along with supplementary agreement both dated 18.02.1992 were executed
between erstwhile petitioner/firm and the respondent, which was renewable
every five years.
8. According to petitioners in these petitions, on the ground that the
internal fittings of shopping arcade were nearly 40 years old and were in
urgent need for repair and it was no longer financially profitable to continue
with the shopping arcade, the respondent vide notice dated 29.05.2020
revoked the license in respect of shop No. L-79 extn (L-81); L-79, license L-
O.M.P.(I) (COMM.) 244; 245; 248 & 249/2021
73 and L-78 w.e.f. 01.06.2020.
9. The petitioners contend that the petitioners were in exclusive
possession of the shops in question and the aforesaid notice did not mention
any violation of the terms and conditions of the license/lease agreement by
petitioners. Further submitted that petitioners had right to carry on business
at the hours suited to them and the license/lease could not have been
terminated at the will of respondent.
10. Learned counsel for petitioners submitted that agreement dated
01.09.1982 contains an arbitration clause and, therefore, vide notice dated
23.03.2021, petitioners called upon respondent to concur in the appointment
of Hon'ble Mr. Justice N.K. Mody (Retd.) as the sole Arbitrator or as
nominee Arbitrator of petitioner/firm, however, since respondent has failed
to concur with the appointment of aforenoted Arbitrator, the petitioners have
approached this Court seeking appointment of Arbitrators in these petitions.
11. Learned senior counsel appearing for respondent submits that
appointment of Arbitrator is not disputed, however, the above captioned
petitions at serial No. (vi) to (viii), filed under the provisions of Section 9 of
Arbitration and Conciliation Act be treated as the one filed under Section 17
of the Act, so that the subject matter of disputes can be given quietus in one
O.M.P.(I) (COMM.) 244; 245; 248 & 249/2021
go by the learned Arbitrator, to be so appointed by this Court.
12. At this stage, counsel for petitioners fairly concedes that if the
disputes inter se parties are being referred to one Arbitrator to arrive at just
decision in these matters, petitioners have no objection to the aforesaid
submission made by learned senior counsel for respondent and the petitions
being O.M.P.(I) (COMM.) 244/2021; 245/2021; 248/2021 and 249/2021 be
read under Section 17 of the Act.
13. It has been also brought to the notice of this Court that against illegal
eviction of petitioners, they had preferred a civil suit CS(Comm)) 237/2020
before this Court for declaration and permanent injunction against the
respondents, which was disposed of vide order dated 21.07.2020 as not
maintainable in view of Arbitration clause between the parties. Since both
the sides were aggrieved of certain observations made by the Court in the
said order, it was challenged before the Division Bench [RFA (OS)
(COMM) 12/2020]. Vide order dated 24.12.2020, the Division Bench
allowed both the appeals and gave liberty to file a petition under Section 8
of the Arbitration and Conciliation Act before the Single Judge while
directing that the interim arrangement between the parties before the learned
Single Judge, that the respondent-Asian Hotels (North) Ltd. shall not take
O.M.P.(I) (COMM.) 244; 245; 248 & 249/2021
any action against the petitioners, shall continue. Learned counsel for
petitioners emphasizes that the interim arrangement so made by learned
Single Judge and upheld by the Division Bench may continue till the
Arbitrator enters into reference.
14. Learned senior counsel appearing on behalf of respondent submits
that the aforesaid interim arrangement shall continue till the Arbitrator
enters into reference.
15. Both sides have been heard and record of these petitions has been
perused.
16. In view of contention raised by both the sides, petitions being
O.M.P.(I) (COMM.) 244/2021; 245/2021; 248/2021 and 249/2021 shall be
read under Section 17 of the Arbitration and Conciliation Act, 1996.
17. Pertinently, the agreement dated 01.09.1982 contains an arbitration
clause, which reads as under:-
"11. That in case of any dispute, difference, between the
company and you, with regard to any matter including
interpretation of this agreement and the clarification
thereof, the same shall be referred to the joint arbitration
of the Chairman of the Company or any person appointed
by the Chairman and the arbitrator appointed by you,
whose decision shall be final and binding between the
parties and shall not be questioned in any court of law."
18. Petitioners have invoked arbitration vide notice dated 23.03.2021. The
O.M.P.(I) (COMM.) 244; 245; 248 & 249/2021
arbitration agreement between the parties and invocation of arbitration are
not disputed by the respondents. Hence, these petitions deserve to be
allowed.
19. However, contention of petitioners to appoint Arbitrator of their
choice is rejected, as no party can be permitted to unilaterally appoint an
Arbitrator, as the same would defeat the purpose of unbiased adjudication of
dispute between the parties. It has so been said in view of pertinent
observations of the Hon'ble Supreme Court in Perkins Eastman Architects
DPC & Anr. vs. HSCC (India) Ltd. 2019 SCC Online SC 1517 wherein it
has been categorically stated that "in cases where one party has a right to
appoint a sole arbitrator, its choice will always have an element of
exclusivity in determining or charting the course for dispute resolution.
Naturally, the person who has an interest in the outcome or decision of the
dispute must not have the power to appoint a sole arbitrator."
20. The afore-noted dictum of Hon'ble Supreme Court in Perkins
Eastman (Supra), has been followed by Coordinate Benches of this Court in
Proddatur Cable Tv Digi Services Vs. Siti Cable Network Limited 2020
SCC OnLine Del 350 and VSK Technologies Private Limited and Others
Vs. Delhi Jal Board 2021 SCC OnLine Del 3525 in unequivocal terms.
O.M.P.(I) (COMM.) 244; 245; 248 & 249/2021
21. Concurring with the decisions as noted above, the present petition is
allowed.
22. Accordingly, Mr. R. L. Meena, former Secretary, department of
Law and Justice (Mobile: 9868601397) is appointed the Sole Arbitrator to
adjudicate the dispute between the parties.
23. The fee of the learned Arbitrator shall be governed by the Fourth
Schedule of the Arbitration and Conciliation Act, 1996.
24. The learned Arbitrator shall ensure compliance of Section 12 of
Arbitration and Conciliation Act, 1996 before commencing the arbitration.
25. Needless to say, all issues are left open for agitation by the parties and
consideration by the learned Arbitrator. It is also made clear that till the
Arbitrator enters into reference, the respondent-Asian Hotels (North) Ltd.
shall not take any action against the petitioners.
26. With aforesaid directions, these petitions and pending application, if
any, are accordingly disposed of.
(SURESH KUMAR KAIT)
JUDGE
AUGUST 06, 2021
r
O.M.P.(I) (COMM.) 244; 245; 248 & 249/2021
