Bombay High Court
Amritlal Versi Malde And Anr vs National (India) Contractors And ... on 20 April, 2021
Author: R.D. Dhanuka
Bench: R. D. Dhanuka, V. G. Bisht
Trupti /Bipin/Vai/kvm comapl-666-2021.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
COMMERCIAL APPEAL (L) NO. 666 OF 2021
WITH
INTERIM APPLICATION (L) NO. 668 OF 2021
IN
COMMERCIAL APPEAL (L) NO. 666 OF 2021
IN
COMMERCIAL ARBITRATION PETITION (L) NO. 6711 OF 2020
Mahendra Devilal Jain )
Adult of Mumbai, Indian Inhabitant )
presently residing at Flat No. 701, 13th )
Floor, Kalash Society, Kaka Saheb )
Gadgil Marg, Dadar West, )
Opp. Ashish Industries, Near Inder )
Tower, Mumbai - 400 028 ) ...Appellant
Versus
1. M/s. National (India) Contractors )
and Engineers )
A Partnership Firm, Having its )
Principal place of business at 628, H.J. )
Khatri House, 13th Road, TPS III, Khar )
(West), Mumbai - 400 052. )
2. Mr. Riyaz Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J. Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. )
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3. Mr.Faruk Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J.Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. ) ...Respondents
WITH
COMMERCIAL APPEAL (L) NO. 669 OF 2021
WITH
INTERIM APPLICATION (L) NO. 675 OF 2021
IN
COMMERCIAL APPEAL (L) NO. 669 OF 2021
IN
COMMERCIAL ARBITRATION PETITION (L) NO. 6685 OF 2020
1. M/s. Malpani Transport Co. )
A Partnership Firm, having its )
present Office at Shop Nos. 20-21, )
Bhaktwar Bldg., Irani Chawl, )
Sayani Road, Gokhale Road, )
Dadar, Mumbai- 400 025 )
2. Jugalkishor M. Malpani )
an Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. Malpani, )
Transport Co., having his present )
Office at Shop Nos. 20-21, )
Bhaktwar Bldg., Irani Chawl, )
Sayani Road, Gokhale Road, )
Dadar, Mumbai- 400 025 )
3. Sulochanadevi S. Malpani )
an Adult of Mumbai, Indian )
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Inhabitant, Partner of M/s. Malpani )
Transport Co., having her present )
Office at Shop Nos. 20-21, )
Bhaktwar Bldg., Irani Chawl, )
Sayani Road, Gokhale Road, )
Dadar, Mumbai - 400 025 ) ...Appellants
Versus
1. M/s. National (India) Contractors )
and Engineers )
A Partnership Firm, Having its )
Principal place of business at 628, H.J. )
Khatri House, 13th Road, TPS III, Khar )
(West), Mumbai - 400 052. )
2. Mr. Riyaz Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J. Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. )
3. Mr.Faruk Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J.Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. ) ...Respondents
WITH
COMMERCIAL APPEAL (L) NO.670 OF 2021
WITH
INTERIM APPLICATION (L) NO.678 OF 2021
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IN
COMMERCIAL APPEAL (L) NO.670 OF 2021
IN
COMMERCIAL ARBITRATION PETITION (L) NO. 6716 OF 2020
Devichand Ambalal Jain )
an Adult of Mumbai, Indian Inhabitant )
Presently residing at Bahari Building No.1)
Room No. 16/17, J.B. Road, )
Cotton Green, Sewri, Mumbai - 400 015) ...Appellant
Versus
1. M/s. National (India) Contractors )
and Engineers )
A Partnership Firm, Having its )
Principal place of business at 628, H.J. )
Khatri House, 13th Road, TPS III, Khar )
(West), Mumbai - 400 052. )
2. Riyaz Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J. Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. )
3. Faruk Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J.Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. ) ...Respondents
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WITH
COMMERCIAL APPEAL (L) NO. 686 OF 2021
WITH
INTERIM APPLICATION (L) NO. 691 OF 2021
IN
COMMERCIAL APPEAL (L) NO. 686 OF 2021
IN
COMMERCIAL ARBITRATION PETITION (L) NO. 6686 OF 2020
1. Rajubai Vithoba More )
an Adult of Mumbai, Indian )
Inhabitant, presently residing at )
Room No. 602, Samarth Krupa )
Sayani Road, Prabhadevi, )
Mumbai- 400 025 )
2. Vidya Vithoba More )
an Adult of Mumbai, Indian )
Inhabitant, presently residing at )
Room No. 602, Samarth Krupa )
Sayani Road, Prabhadevi )
Mumbai - 400 025 ) ...Appellants
Versus
1. M/s. National (India) Contractors )
and Engineers )
A Partnership Firm, having its )
Principal place of business at )
628, H.J. Khatri House, 13th Road )
TPS III, Khar (W), Mumbai - 400 052 )
2. Riyaz Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
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having his office at 628, H.J. Khatri )
th
House, 13 Road, TPS III, Khar (West) )
Mumbai - 400 052. )
3. Faruk Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J.Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. ) ...Respondents
WITH
COMMERCIAL APPEAL (L) NO. 705 OF 2021
WITH
INTERIM APPLICATION (L) NO. 710 OF 2021
IN
COMMERCIAL APPEAL (L) NO. 705 OF 2021
IN
COMMERCIAL ARBITRATION PETITION(L) NO. 6726 OF 2020
Bharatkumar Mohanlal Shah )
and Adult of Mumbai, Indian )
Inhabitant, presently residing at )
Shop No. 35, Irani Chawl )
Gokhale Road South, Sayani Road )
Opp. Sigma Estate, Dadar, )
Mumbai - 400 028 ) ...Appellant
Versus
1. M/s. National (India) Contractors )
and Engineers )
A Partnership Firm, having its )
Principal place of business at )
628, H.J. Khatri House, 13th Road )
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TPS III, Khar (W), Mumbai - 400 052 )
2. Riyaz Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J. Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. )
3. Faruk Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J.Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. ) ...Respondents
WITH
COMMERCIAL APPEAL (L) NO.732 OF 2021
WITH
INTERIM APPLICATION (L) NO. 745 OF 2021
IN
COMMERCIAL APPEAL (L) NO.732 OF 2021
IN
COMMERCIAL ARBITRATION PETITION (L) NO. 6689 OF 2020
1. Manibai Champalal Jain )
an Adult of Mumbai, Indian )
Inhabitant, presently residing at )
Boman Behram Building, 2nd Floor )
Room No. 13, Seth Moti Shah Road )
Opp. Super Bakery, Love Lane, )
Mazgaon, Mumbai -400 010 )
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2. Champalal L. Jain )
an Adult of Mumbai, Indian )
Inhabitant, presently residing at )
Boman Behram Building, 2nd Floor )
Room No. 13, Seth Moti Shah Road )
Opp. Super Bakery, Love Lane )
Mazgaon, Mumbai - 400 010 ) ...Appellants
Versus
1. M/s. National (India) Contractors )
and Engineers )
A Partnership Firm, having its )
Principal place of business at )
628, H.J. Khatri House, 13th Road )
TPS III, Khar (W), Mumbai - 400 052 )
2. Riyaz Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J. Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. )
3. Faruk Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J.Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. ) ...Respondents
WITH
COMMERCIAL APPEAL (L) NO.747 OF 2021
WITH
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INTERIM APPLICATION (L) NO.751 OF 2021
IN
COMMERCIAL APPEAL (L) NO.747 OF 2021
IN
COMMERCIAL ARBITRATION PETITION (L) NO. 6681 OF 2020
Kanchanbai Futarmal Jain )
an Adult of Mumbai, Indian )
Inhabitant, presently residing at )
Flat No. 609, 6th Floor, Samarth Krupa CHS )
Sayani Road, Dadar, Mumbai - 400 025 ) ...Appellant
Versus
1. M/s. National (India) Contractors )
and Engineers )
A Partnership Firm, having its )
Principal place of business at )
628, H.J. Khatri House, 13th Road )
TPS III, Khar (W), Mumbai - 400 052 )
2. Riyaz Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J. Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. )
3. Faruk Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J.Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. ) ...Respondents
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WITH
COMMERCIAL APPEAL (L) NO.755 OF 2021
WITH
INTERIM APPLICATION (L) NO 763 OF 2021
IN
COMMERCIAL APPEAL (L) NO.755 OF 2021
IN
COMMERCIAL ARBITRATION PETITION (L) NO. 6679 OF 2020
1. Amritlal Versi Malde )
an Adult of Mumbai, Indian )
Inhabitant, presently residing at )
501/502, Krishna, 79-A, )
Jain Derasar Marg, Santacruz (W) )
Mumbai - 400 054 )
2. Vijaya Amritlal Malde )
an Adult of Mumbai, Indian )
Inhabitant, presently residing at )
501/502, Krishna, 79-A, )
Jain Derasar Marg, Santacruz (W) )
Mumbai - 400 054 ) ...Appellants
Versus
1. M/s. National (India) Contractors )
and Engineers )
A Partnership Firm, having its )
Principal place of business at )
628, H.J. Khatri House, 13th Road )
TPS III, Khar (W), Mumbai - 400 052 )
2. Riyaz Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J. Khatri )
10
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House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. )
3. Faruk Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J.Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. ) ...Respondents
WITH
COMMERCIAL APPEAL (L) NO.770 OF 2021
WITH
INTERIM APPLICATION (L) NO.774 OF 2021
IN
COMMERCIAL APPEAL (L) NO.770 OF 2021
IN
COMMERCIAL ARBITRATION PETITION (L) NO. 6699 OF 2020
1. Jayshree Murlidhar Dhuri )
an Adult of Mumbai, Indian )
Inhabitant, present residing at )
Room No. 508, Samarth Krupa )
Sayani Road, Prabhadevi )
Mumbai - 400 025 )
2. Krishna Murlidhar Dhuri )
an Adult of Mumbai, Indian )
Inhabitant, surviving legal heir of )
Murlidhar Dhuri, presently residing )
at Room No. 508, Samarth Krupa, )
Sayanai Road, Prabhadevi, )
Mumbai - 400 025 )
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3. Dnyanadev Murlidhar Dhuri )
an Adult of Mumbai, Indian )
Inhabitant, surviving legal heir of )
Murlidhar Dhuri, presently residing )
at Room No. 508, Samarth Krupa )
Sayanai Road, Prabhadevi, )
Mumbai - 400 025 )
4. Leena Lakshmikant Sawant )
an Adult of Mumbai, Indian )
Inhabitant, surviving legal heir of )
Murlidhar Dhuri, presently residing )
at Room No. 214, C- Wing, )
Konkan Nagar, Jogeshwari (West) )
Mumbai - 400 060 ) ...Appellants
Versus
1. M/s. National (India) Contractors )
and Engineers )
A Partnership Firm, having its )
Principal place of business at )
628, H.J. Khatri House, 13th Road )
TPS III, Khar (W), Mumbai - 400 052 )
2. Riyaz Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J. Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. )
3. Faruk Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
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(India) Contractors and Engineers, )
having his office at 628, H.J.Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. ) ...Respondents
WITH
COMMERCIAL APPEAL (L) NO.777 OF 2021
WITH
INTERIM APPLICATION (L) NO.778 OF 2021
IN
COMMERCIAL APPEAL (L) NO.777 OF 2021
IN
COMMERCIAL ARBITRATION PETITION(L) NO. 6731 OF 2020
1. Chandrakant Sahadev Bagwe )
an Adult of Mumbai, Indian )
Inhabitant, presently residing at )
607, Samarth Krupa, Sayanai Road )
Prabhadevi, Mumbai -400 025 )
2. Vandana Parshuram Bagwe )
an Adult of Mumbai, Indian )
Inhabitant, presently residing at )
607, Samarth Krupa, Sayanai Road )
Prabhadevi, Mumbai -400 025 ) ...Appellants
Versus
1. M/s. National (India) Contractors )
and Engineers )
A Partnership Firm, having its )
Principal place of business at )
628, H.J. Khatri House, 13th Road )
TPS III, Khar (W), Mumbai - 400 052 )
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2. Riyaz Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J. Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. )
3. Faruk Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J.Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. ) ...Respondents
WITH
COMMERCIAL APPEAL (L) NO. 776 OF 2021
WITH
INTERIM APPLICATION (L) NO. 779 OF 2021
IN
COMMERCIAL APPEAL (L) NO. 776 OF 2021
IN
COMMERCIAL ARBITRATION PETITION (L) NO. 6713 OF 2020
1. Dilip Kumar Devilal Jain )
an Adult of Mumbai, Indian )
Inhabitant, presently residing at )
601, 6th Floor, Shree Sai Complex CHS )
Ltd., Sayani Road, Near Parel ST )
Depot, Mumbai - 400 0025 ) ...Appellants
Versus
1. M/s. National (India) Contractors )
and Engineers )
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A Partnership Firm, having its )
Principal place of business at )
628, H.J. Khatri House, 13th Road )
TPS III, Khar (W), Mumbai - 400 052 )
2. Riyaz Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J. Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. )
3. Faruk Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J.Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. ) ...Respondents
WITH
COMMERCIAL APPEAL (L) NO. 764 OF 2021
WITH
INTERIM APPLICATION (L) NO. 768 OF 2021
IN
COMMERCIAL APPEAL (L) NO. 764 OF 2021
IN
COMMERCIAL ARBITRATION PETITION (L) NO. 6689 OF 2020
Sohanlal Chunilal Jain )
an Adult of Mumbai, Indian )
Inhabitant, presently residing at )
Bahari Building No. 1/15, First Floor )
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J.B. Road, Sewree, Mumbai - 400 015 ) ...Appellant
Versus
1. M/s. National (India) Contractors )
and Engineers )
A Partnership Firm, having its )
Principal place of business at )
628, H.J. Khatri House, 13th Road )
TPS III, Khar (W), Mumbai - 400 052 )
2. Riyaz Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J. Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. )
3. Faruk Usmangani Khatri )
An Adult of Mumbai, Indian )
Inhabitant, Partner of M/s. National )
(India) Contractors and Engineers, )
having his office at 628, H.J.Khatri )
House, 13th Road, TPS III, Khar (West) )
Mumbai - 400 052. ) ...Respondents
.......
Mr.Naushad Engineer a/w. Mr. Hasmit Trivedi, Mr. Naresh Chheda
and Ms.Sakina Electricwala i/b. M/s. Tauris Legal for the
Appellants/ Applicants in all Appeals.
Dr.Abhinav Chandrachud a/w. Mr.Mukesh Pabari for the
Respondents in all Appeals.
......
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CORAM : R. D. DHANUKA &
V. G. BISHT, JJ.
RESERVED DATE : 31ST MARCH, 2021
PRONOUNCED DATE : 20TH APRIL, 2021
JUDGMENT :(PER : R.D. DHANUKA, J.)
1. By these Appeals filed under Section 37 of the Arbitration and Conciliation Act, 1996 (for short, "The Arbitration Act'), the appellants (original petitioners) have impugned the order passed by the learned Single Judge dismissing the Arbitration Petitions filed by the appellants under Section 9 of the Arbitration Act on the ground of jurisdiction.
2. By consent of parties, this batch of Appeals were heard together and are being disposed of by a common order. The parties have addressed this Court in Commercial Appeal (L) No. 666 of 2021 as a lead matter and have agreed that the other matters being identical to Commercial Appeal (L) No. 666 of 2021, the decision of this Court in the said Commercial Appeal (L) No. 666 of 2021 would apply to the other connected matters. Some of the relevant facts in the said Commercial Appeal (L) No. 666 of 2021 are as under :
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3. The appellant was a tenant of respondent No.1 in respect of Shop No. 8 (old shop/ tenanted premises) in the old building known as Mantri Chawl situated at City Survey No. 1138 of Mahim Division admeasuring about 4136 sq. meters. Respondent Nos. 2 and 3 are the partners of respondent No.1. The entire building was fully tenanted. The other appellants were also the tenants in respect of various tenements in the said building owned by the respondent no.1.
4. It is the case of the appellant that some time in the year 2013, respondent No.1 approached the appellant with a proposal for redevelopment of the said property under Regulation 33 (7) of the Development Control Regulations, 1991 by demolishing the old building and reconstructing a new building on the said land. On 12th May, 2014, the appellant along with other tenants entered into an agreement with respondent No.1. Under the said agreement, respondent No.1 agreed to demolish the old building and to construct a new building and to allot to the appellant a self-contained new shop admeasuring 269.12 sq. ft. on ownership basis free of cost on the terms and conditions set out therein.
5. Under clause 3 of the said agreement, respondent No.1 undertook to complete the construction of the new building within a period of 11 months with an additional grace period of three 18 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc months from the date of the last tenant handing over possession of his tenement to respondent No.1. Other terms and conditions of the agreement would be described in the latter part of this judgment.
6. It is the case of the appellant that in the month of July, 2014, the tenants of the said old building including the appellant vacated their respective premises. Respondent No.1 thereafter demolished the old building and commenced construction of the new building. During the period between 2015-2017 the respondent No.1 failed to complete the construction of the new building on the property within the stipulated period of 11 months i.e. 1st June, 2015 and also the grace period of three months. In accordance with the terms of the agreement, the appellant deposited the cheque for a sum of Rs. 1,13,068/- lying in escrow which was issued by respondent No.1 as compensation in lieu of temporary alternate accommodation for three months grace period.
7. It is the case of the appellant that several meetings were held between the parties when respondent No.1 assured the appellant that the project would be completed by March, 2017 and agreed to pay further compensation in lieu of temporary alternate accommodation till the date of handing over of possession of the new building. The respondents, however, failed 19 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc to comply with the said obligation under the said agreement and also the assurances given to the appellants. On 16 th January, 2019, the respondent No.1 issued three cheques for an aggregate sum of Rs. 1,13,068/- towards compensation in lieu of temporary alternate accommodation for the period December, 2016 to February, 2017. It is the case of the appellant that since March, 2017 till date, respondent No.1 failed to pay compensation in lieu of temporary alternate accommodation to the appellant and the other appellants.
8. On 12th February, 2019 and 16th April, 2019, meetings were held between the parties. Respondent No.1 promised the appellant and other tenants to complete the construction of the new building and to pay the arrears of compensation in lieu of temporary alternate accommodation. On 19th June, 2019, the appellant and the other tenants through their advocates' notice invoked the arbitration clause recorded in clause 16 of the said agreement dated 12th May, 2014 and nominated an arbitrator. The appellant called upon respondent No.1 to confirm the name of the arbitrator nominated by the appellant as a sole arbitrator. Vide their advocates' letter dated 26th July, 2019, respondent No.1 rejected the nomination of the Sole Arbitrator suggested by the appellant and in turn nominated another person as the Sole Arbitrator.
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9. It is the case of the appellant that in the said reply dated 26th July, 2019, respondent No.1 did not contend that the disputes between the parties were not arbitrable and fell within the exclusive jurisdiction of the Small Causes Court as contemplated under Section 41 (1) of Presidency Small Causes Court Act, 1882 or Section 33 of Maharashtra Rent Control Act, 1999. Vide letter dated 17th March, 2020, the appellant through their advocate's denied the allegations made by respondent No.1 in their advocate's letter dated 26th July, 2019 and called upon respondent No.1 to comply with the requisitions contained in letter dated 19 th June, 2019 addressed by the appellant through advocate's letter.
10. On 12th October, 2020, the appellant filed Commercial Arbitration Petition (L) No. 6711 of 2020 and other connected matters under Section 9 of the Arbitration Act inter alia praying for an order and direction against respondent No.1 to pay / deposit the outstanding compensation in lieu of temporary alternate accommodation for the period March, 2020 to October 2020 aggregating to Rs. 16,58,330.52. Similar prayer was also made in other Arbitration Petitions filed by other appellants under Section 9 of the Arbitration Act against the respondents. The appellant also filed Commercial Arbitration Application (L) No. 6719 of 2020 under Section 11 of the Arbitration Act inter alia praying for an appointment of the arbitrator.
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11. On 25th November, 2020, a learned Single Judge of this Court in those petitions filed by the appellants under Section 9 of the Arbitration Act directed the respondents to completely disclose the amount that was even according to the respondents due to each of the appellants in respect of their various premises. Such affidavit shall also indicate as to when those admitted amounts would be paid and also a commitment in regard to the displacement compensation to be paid for November, 2020 onwards. On 2nd February, 2020, respondent No.1 filed an affidavit in reply in those petitions filed by the appellants under Section 9 of the Arbitration Act. Respondent No.1 admitted in the said affidavit that it was liable to pay the arrears of compensation in lieu of temporary alternate accommodation to the appellants. In the said affidavit, respondent No.1 did not raise any issue that this Court does not have jurisdiction to entertain and dispose of those petitions filed under Section 9 of the Arbitration Act.
12. On 11th December, 2020, the learned Single Judge passed an order holding that the disputes of the appellants pertaining to specific performance of the agreement by which permanent alternate accommodation on ownership basis was to be provided to the appellants and the failure of the respondents to pay displacement compensation are not arbitrable. The Small Causes Court, Bombay will have the exclusive jurisdiction to try and dispose of the same. The learned Single Judge, however, made it 22 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc clear that the said order was confined to the reliefs under Section 9 of the Arbitration Act and was not an assessment on merits of the case of the appellants for interim or ad-interim relief including for payment of compensation. The learned Single Judge had addressed the question of jurisdiction in the said order and nothing further. Being aggrieved by the said order passed by the learned Single Judge, each of those petitioners filed separate Commercial Arbitration Appeals under Section 37 of the Arbitration Act which are being disposed by this common order.
13. Mr Engineer, learned Counsel for the appellant, tendered a list of dates and events on behalf of the appellant in Commercial Arbitration Appeal (L) No. 666 of 2021. He invited our attention to various documents annexed to the appeal memo including various orders passed by the learned Single Judge. He also invited our attention to the prayers in the petitions filed by his clients under Section 9 of the Arbitration Act before the learned Single Judge, the affidavits filed by the parties, various provisions of Presidency Small Causes Court Act, 1882, Maharashtra Rent Control Act, 1999 and various judgments.
14. The learned Counsel for the appellant invited our attention to Recital (j) (iv), Recital (j) (v), Recital (j) (vi) and Recital (j) (ix) of the said agreement dated 12th May, 2014 and clause Nos. 2.11, 2.15, 3, 4.7, 5.1 to 5.4 and 16 of the said agreement dated 12 th 23 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc May, 2014. It is submitted by learned Counsel that though the appellant had no occasion to file any statement of claim in view of the respondents refusing to appoint an arbitrator, the correspondence on record clearly indicated that each of the appellants wanted to claim specific performance of various provisions of the said agreement dated 12th May, 2014 entered into between the appellants and respondent No.1.
15. The appellant also have claim for recovery of the compensation payable by respondent No.1 to the appellant in lieu of temporary alternate accommodation which was not paid by respondent No.1 from March, 2017 till date. He invited our attention to the notice invoking arbitration agreement issued by the appellant through advocate's letter dated 19 th June, 2019 and the reply thereto by respondent No.1 to apprise this Court all the nature of disputes between the appellant and respondent No.1 relating to specific performance of the said agreement dated 12 th May, 2014.
16. It is submitted by learned Counsel that pursuant to the said agreement dated 12th May, 2014, each of the tenants including the appellant had vacated their respective tenements and handed over possession to respondent No.1 for the purpose of demolition of the entire building and for the purpose of reconstruction of the new building and to hand over the specific tenement to be constructed 24 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc in the new building to each of the tenants on ownership basis. Respondent No. 1 thereafter demolished the entire building and has reconstructed a new building on the said plot bearing City Survey No. 1138 of Mahim Division. Respondent No.1 though issued three cheques for an aggregate sum of Rs. 1,13,068/- towards compensation in lieu of temporary alternate accommodation for the period December, 2016 to February, 2017 on 16th January, 2019, respondent No. 1 failed to pay compensation in lieu of temporary alternate accommodation from March, 2017 till date. Though respondent No.1 was under an obligation to complete the construction of the new building on or before 1st June, 2015 and within three months grace period, respondent No.1 failed to complete construction of the new building and to hand over the tenements of the appellants in the new building on ownership basis.
17. It is submitted by learned Counsel that though under Recital
(j) ( ix) at page No. 89 of the appeal memo, it was provided that on the date of the tenant being offered the newly constructed office as and by way of permanent alternate accommodation on ownership basis free of cost in the newly constructed building by a notice in writing intimating the tenant to take possession thereof, the tenancy of the tenant in respect of the existing shop cum office shall automatically stand converted to ownership rights would not oust the appellants to claim ownership rights in the tenements to 25 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc be constructed in the new building which was to be handed over to the appellant on ownership basis free of cost.
18. Learned counsel placed reliance on clause 2.11 in support of his submission. The tenants of the building were to form a society under the provisions of the Maharashtra Ownership Flats (Regulation of the promotion of construction, sale, management and transfer) Act, 1963 and, more particularly, under clause 2.5 of the said agreement. He submits that both the parties have acted upon the said agreement by which respondent No.1 had agreed to offer permanent alternate accommodation in the new building on ownership basis free of cost.
19. It is submitted by learned Counsel that the amount agreed to be paid by respondent No.1 to the appellants in lieu of the temporary alternate accommodation could not have to be construed as a rent but was a displacement rent / compensation payable to the appellants in lieu of the temporary alternate accommodation. Respondent No.1 had also agreed to pay compensation to the appellant for delay in carrying out the construction of the said building. Respondent No.1 had also agreed to pay corpus fund to each of the appellants. Respondent No.1 had agreed to demolish the existing building occupied by the tenants and to construct a new building in accordance with the permission granted by MHADA under Regulation 33 (7) of the 26 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc Development Control Regulations, 1991.
20. The learned Counsel for the appellant invited our attention to the reply dated 27th July, 2019 given by respondent to the notice dated 19th June, 2019 invoking arbitration agreement by the appellant and would submit that the respondent did not raise any objection to the invocation of arbitration agreement by the appellant on the ground that no such arbitration agreement could be invoked for adjudication of the disputes raised by the appellant in the said notice before the Arbitral Tribunal in the said reply.
21. Learned counsel also invited our attention to the averments made by the respondent in paragraph 6 of the affidavit in reply filed by the respondent and would submit that the respondent had admitted that certain amount of compensation in lieu of temporary transit accommodation was already paid by the respondent to the appellant under the said agreement. He submits that any agreement which ousts the jurisdiction has to be construed strictly. He placed reliance on the judgment of this Court in case of Govindram Salamatrai Bachani vs Dharampal Amarnath Puri 1and in particular paragraph No.3 in support of his submission that any agreement which ousts the jurisdiction has to be construed strictly. He submits that in view of the enactment of Maharashtra Rent Control Act, 1999 the corresponding provision 1 (1951) 53 Bom LR 386 27 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc relating to jurisdiction, if any, of the Small Cause Court would be under Section 33 of the said Act. He submits that the said provision, however, is not at all attracted to the dispute between the appellant and respondent.
22. The learned Counsel for the appellant placed reliance on the judgment of this Court in case of Dattatray Krishna Jangam vs Jairam Ganesh Gore2 and in particular paragraph Nos. 5 to 7, 11 and 13 and would submit that this Court in the said judgment has clearly described which suits only could be tried by Small Causes Court. He submits that the dispute between the parties in no circumstances can be tried by the Small Causes Court.
23. The learned Counsel for the appellant placed reliance on the judgment of this Court in case of Chandrakant Shankar Pradhan. M/s. Verma Investment Corporation and Ors.3 and in particular paragraph No. 3 and would submit that the Court while deciding the issue of jurisdiction has to consider the averments made in the plaint. If the plaint proceeds on the basis of averments in the plaint that the suit was for specific performance of an agreement, Section 28 of the Bombay Rent Act, 1947 would not apply. The appellant in this case seeks recovery of possession of the permanent alternate accommodation agreed to be handed over by the respondent no.1 under the said agreement on ownership basis.
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There is no question of any relief being sought by the appellant for declaration that the appellant is a tenant of the respondent in respect of the said permanent alternate accommodation offered to the appellant by the respondent under the said agreement.
24. It is submitted that Recital (ix) in the said agreement is not the correct test. The Court has to see whether the appellant sued as a tenant for permanent alternate accommodation of the new tenement by the respondent without payment of any costs. He submits that the respondent would be sued as a developer and not as a landlord in the arbitral proceedings. No issue thus arises for determination as to whether the relationship between the landlord and the tenant shall be declared or not. The appellant is not seeking recovery of any rent in respect of any such premises nor seeking recovery of possession of the tenanted premises. He submits that the Small Causes Court has no jurisdiction to grant any relief of specific performance of an agreement for permanent alternate accommodation on ownership basis free of cost against the respondent.
25. The learned Counsel for the appellant placed reliance on the definition of "landlord" under Section 7 (3) of Maharashtra Rent Control Act, 1999 and would submit that only the person who is entitled to receive rent would fall under the definition of "landlord" within the meaning of Section 7 (3) of Maharashtra 29 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc Rent Control Act, 1999. He relied upon the definition of "tenant" as defined under Section 7 (15) of the said Act which provides that the rent is payable by the tenant to the landlord. It is not the case of respondent that under the said agreement the appellant would be paying any rent to the respondent as defined under Section 7 (15) of the said Act.
26. The learned Counsel for the appellant placed reliance on the judgment of the Supreme Court in case of Karnani Properties Limited versus Miss Augustine & Others 4 and in particular paragraph No.5 page No.4 in support of his submission that the rent is the payment agreed by the tenant to be paid to his landlord for the use and occupation not only of the building and its appurtenances but also of furnishings, electric installations and other amenities agreed by and between the parties to be provided by and at the cost of the landlord. He submits that in this case admittedly the respondent had not only agreed to provide the permanent alternate accommodation of a tenement in the new building on ownership basis free of cost but also the compensation in lieu of the temporary transit accommodation and thus such payment would not fall within the definition "rent" payable by a tenant to the landlord within the meaning of Section 7 (15) of Maharashtra Rent Control Act, 1999.
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27. The learned Counsel for the appellant placed reliance on the judgment of the Supreme Court in case of Abdul Kader versus G.D.Govindaraj (dead) by Lrs. 5and in particular paragraph No.5 in support of his submission that the rent includes all payment agreed by the tenant to be paid to the landlord for the use and occupation and not the payment to be made by the landlord to the tenant towards temporary transit accommodation under the said agreement.
28. The learned Counsel placed reliance on the judgment of this Court in case of Shashikant G. Mehta vs. Soonoo Minoo Khajotia and others6 and in particular paragraph 16 in support of his submission that the rent is payable by the tenant to the landlord and not by the landlord to the tenant. He also placed reliance on the judgment of this Court in case of Brainvisa Technologies Pvt. Ltd. versus Subhash Gaikwad (HUF) 7and in particular paragraph Nos. 3 and 9 and would submit that this is not a case of payment of rent or licence fee by the appellant to the respondent and thus there is no question of there being a dispute for recovery of any rent by the landlord from tenant. Neither Section 41 of Presidency Small Causes Court Act, 1882 nor the provisions of Maharashtra Rent Control Act, 1999 thus would apply to the dispute between the appellant and respondent.
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29. The learned Counsel for the appellant placed reliance on the judgment of this Court in case of Globsport India Private Limited versus Mayfair Housing Private Limited8 and in particular paragraph Nos. 17 and 18 and would submit that the claim for recovery of damages/ compensation would not fall under Section 41 of Presidency Small Causes Court Act, 1882. The appellant does not seek any adjudication as to whether the appellant is a tenant of the respondent or not in respect of the said premises. The original premises occupied by the appellant as a tenant of the respondent has been already demolished to enable the respondent to carry out construction of a new building and to offer the tenements therein to the appellants as and by way of permanent alternate accommodation free of cost.
30. This is a case of the respondent no.1 paying compensation to the appellant for delay in handing over possession of the tenements constructed in the new building as and by way of permanent alternate accommodation on ownership basis. The respondent no. 1 is under an obligation to handover possession of the tenements constructed in the new building as and by way of permanent alternate accommodation on ownership basis in the new building to the appellant pursuant to the permission granted by MHADA in favour of the respondent no.1 under Regulations 33 (7) of the Development Control Regulations, 1991. It is submitted 8 2015 SCC Online Bom 4176 32 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc that the respondent no.1 has not got the original tenements vacated from each of the appellants for carrying out repairs or pursuant to any notice for vacating the tenements issued by Mumbai Municipal Corporation or any other authority under the provisions of Maharashtra Rent Control Act, 1999.
31. The learned Counsel for the appellant invited our attention to the said agreement dated 12th May, 2014 and would submit that the said agreement was stamped under Article B25 i.e. agreement to sell/ transfer /assignment and stamp duty was paid accordingly by the respondent. The respondent cannot be allowed to now urge that the said agreement was relating to continuation of the then existing rights as a tenant also in respect of the tenements offered by respondent to the appellant in the new building.
32. Dr.Chandrachud, learned Counsel for the respondents, on the other hand, would submit that the adjudication of dispute between the landlord and tenant has to be adjudicated upon under one umbrella policy described under the provisions of Section 41 of Presidency Small Causes Court Act,1882 read with the provisions of Maharashtra Rent Control Act,1999 in respect of all the disputes between landlord and tenant. The said provisions of Presidency Small Causes Court Act,1882 and Maharashtra Rent Control Act, 1999 are social welfare legislation for the benefit of tenants.
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33. Learned counsel relied upon Recital (ix) of the said agreement, 2.5 and 4.7 thereof in support of his submission that the appellant would be continued to be tenant of the respondent in respect of the premises occupied by them till permanent alternate accommodation was handed over to the appellant and till such time the appellant would continue to pay rent to the respondent in respect of such premises. He submits that the relationship of the respondent with the appellant as landlord and tenant respectively thus continues in view of the respondent admittedly not having handed over the possession of permanent alternate accommodation on ownership basis to the appellant till date. The respondent is entitled to adjust the said monthly rent payable by the appellant to the respondent as a tenant till new shop-cum-office is handed over by the respondent to the appellant on ownership basis by way of permanent alternate accommodation. Any dispute thus between the appellant and respondent including recovery of possession of the premises in the new building and for recovery of compensation would be a dispute between the landlord and the tenant falling within the exclusive jurisdiction of the Small Causes Court under Section 41 of Presidency Small Causes Court Act, 1882 or under Section 33 of Maharashtra Rent Control Act,1999.
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34. It is submitted by the learned Counsel that even if the tenant applies for specific performance of the tenanted premises against the landlord, Section 41 of Presidency Small Causes Court Act, 1882 or Section 28 of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (for short, "The Bombay Rent Act, 1947) or Section 33 of Maharashtra Rent Control Act,1999 are still attracted.
35. The learned Counsel for the respondents distinguished the judgment of this Court in case of Chandrakant Shankar Pradhan v. Verma Investment (supra) relied upon by learned Counsel on the ground that in that case the tenant had surrendered the tenancy to the landlord which is not the situation in this case. Till the appellant would surrender the tenancy in respect of the tenements in their possession to the respondents, they continued to be tenant of the premises and do not become owner of the new tenements agreed to be handed over to them by the respondents under the said agreement.
36. It is submitted that Section 41 of Presidency Small Causes Court Act, 1882 read with the Bombay Rent Act, 1947 and Maharashtra Rent Control Act, 1999 are salutary provisions made to protect the interest of the tenants and on this ground itself, the dispute between the appellant and the respondents can be tried only by the Small Causes Court at Mumbai.
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37. The learned Counsel for the respondents submits that if the landlord demolishes the building and does not handover possession thereof to the tenant or does not pay rent to the tenant for shifting the tenants to permanent alternate accommodation, the tenant is required to file a suit for recovery of possession and for payment of rent against the landlord only before the Small Causes Court. The payment in respect of the security deposit is not recurring in nature whereas the payment of rent is of recurring nature. The law applicable for refund of security deposit would not apply to the claim for recovery of rent.
38. The learned Counsel for the respondents invited our attention to paragraph 3 (b) of the averments made in the petition filed under Section 9 of the Arbitration Act before learned Single Judge and would submit that the appellant himself had admitted in the said paragraph that the appellant is a lawful tenant of respondent No.1 in respect of the shop-cum-office No.8. It is thus clear that the dispute raised by the appellant as a tenant against the respondent as a landlord cannot be adjudicated upon by an arbitrator under the said Arbitration Agreement entered into between the parties but can be tried and adjudicated upon only by the Small Causes Court exclusively. He submits that the tenancy rights of the appellant has not come to an end till possession of the permanent alternate accommodation is handed over by 36 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc respondent to the appellant.
39. The learned Counsel for the respondents invited our attention to the averments made in paragraph (g) at page No. 42 of the paper book and would submit that in the said petition filed under Section 9 of the Arbitration Act it was the case of the appellant that the appellant was entitled to monthly displacement rent for temporary transit accommodation of the old shop per month. This relief can be granted only by the Small Causes Court and not in the arbitral proceedings. He invited our attention to the averments made in paragraph No. (n) on page Nos. 46-47 of the appeal paper book and would submit that the appellant had contended that respondent was duty bound to pay to the appellant a sum of Rs. 37, 689.33 per month towards monthly displacement rent and a sum of Rs. 1,00,000/- per month towards delay compensation for default period till handing over of new shop in the new building.
40. In paragraph No. 7 of the said Arbitration Petition, the appellant had contended that the appellant was entitled to recover the compensation. He submits that by such a clever drafting of the appellant in the arbitration petition, the appellant could not confer jurisdiction in the arbitral tribunal which the arbitral tribunal did not have. The Small Causes Court has exclusive jurisdiction to adjudicate upon such dispute between the landlord 37 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc and a tenant and no one can divest the Small Causes Court of its jurisdiction by such clever drafting.
41. The learned Counsel for the respondents invited our attention to the averments made in paragraph No. 22 of the Arbitration Petition and would submit that the said averments will have to be read with prayer clauses (a) and (b) of the said petition which would clearly indicate that the appellant had prayed for payment of compensation/ monthly displacement rent for temporary accommodation for 44 months which relief can be adjudicated upon only by the Small Causes Court and not by the Arbitral Tribunal.
42. The learned Counsel placed reliance on clause No.3 of the said agreement and would submit that since the respondents had agreed to pay compensation/ monthly displacement rent till the possession of permanent alternate accommodation was handed over to the appellant, the relationship of the respondent with the appellant as landlord and tenant continued. He relied upon clauses 5.1, 5.2 and 5.6 of the said agreement in support of his submission that the Municipal Taxes and Land under Construction taxes, during the period of construction shall be borne and paid by the respondent. The said clauses would also clearly indicate that the relationship between the respondents and appellant as landlord and tenant continued.
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43. The learned Counsel for the respondents invited our attention to the notice dated 19 th June, 2019 issued by the appellant through advocate's letter invoking arbitration agreement and, more particularly, paragraph 1 thereof in support of his submission that it is the case of the appellant that he is a lawful tenant in respect of the shop-cum-office. Even in the said notice invoking arbitration agreement, the appellant had demanded claim for compensation/ rent. He submits that under Section 41 of Presidency Small Causes Court Act, 1882 the appellant ought to have applied for recovery of compensation and alleged non- payment of compensation for monthly displacement rent or for compensation for temporary alternate accommodation. Such prayer for recovery of possession in the new building also would fall within the exclusive jurisdiction of the Small Causes Court under Section 41 of Presidency Small Causes Court Act, 1882.
44. The learned Counsel for the respondents invited our attention to Section 33 of the Maharashtra Rent Control Act, 1999 and would submit that the said provision does not refer to "charges" whereas Section 41 of Presidency Small Causes Court Act, 1882 refers to "charges". The forum for recovery of charges under Section 33 of Maharashtra Rent Control Act, 1999 and under Section 41 of Presidency Small Causes Court Act,1882 however is the same.
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45. The learned Counsel relied upon Section 16 (i) and (k) of Maharashtra Rent Control Act, 1999 and would submit that even if the developer wants to recover possession of the tenanted premises for carrying out repairs or for demolition pursuant to a notice for vacating the premises from the Municipal Corporation of Greater Mumbai, the developer is required to file a suit for recovery of possession only before the Small Causes Court and not before the Arbitral Tribunal. He also relied upon Section 21 (2)
(a) of the said Maharashtra Rent Control Act. He submits that similarly if the landlord does not handover the premises in the new building to the tenant, the tenant has to file a suit for recovery of possession against the landlord before Small Causes Court.
46. The learned Counsel placed reliance on the judgment delivered by Division Bench of this Court in case of Tejbai Tejshi Dedhia and others vs. Central Bank of India and others 9 and in particular paragraph Nos. 2, 7-13, 14, 16, 17, 19, 23-24, 29, 31 and 38 of the said judgment and would submit that since the appellant had agreed to vacate the premises to enable the respondents to construct new building subject to continuation of existing relationship of landlord -tenant in relation to the premises in the new building to be constructed on demolition of the 9 (2007) 5 Mah LJ 869 40 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc building, no Civil Suit for specific performance of such agreement by the tenant could be filed before a Civil Court for enforcement of rights and obligations of tenant and landlord as the same would be hit by Section 28 of the Bombay Rent Act, 1947. He submits that the said judgment delivered by a Division Bench of this Court would squarely apply to the facts of this Case.
47. Learned counsel for the respondents relied upon the judgment of this Court in case of Chandrakant Shankar Pradhan (supra) in paragraph 5 and would submit that admittedly in this case the agreement between the parties provided that the tenancy rights of the appellant would continue till possession of the permanent alternate accommodation in the new building would be handed-over to the appellant. He submits that in that case, there was never a relationship of the landlord and tenant between the parties. However, in this case, the relationship between the appellant and the respondent being tenant and landlord continued. He submits that the said judgment of this Court in case of Chandrakant Shankar Pradhan (supra) thus would not apply to the facts of this case.
48. Learned counsel for the respondents placed reliance on the judgment of this Court in case of ING Vysya Bank Ltd. v/s. Modern India Ltd. and Anr.,10 and in particular 1, 8, 17 and 22.
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He submits that the important public purpose underlying the conferment of exclusive jurisdiction on the Small Causes Court will be defeated, if the dispute between the parties is tried by the Arbitral Tribunal.
49. Learned counsel for the respondents placed reliance on the judgment of this Court in case of Brainvisa Technologies Pvt. Ltd. (supra) and in particular paragraphs 9 and 10 and would submit that this Court in the said judgment has set out an exception that a suit for the recovery of security deposit does not constitute a suit for the recovery of 'licence fee or charges or rent therefor', which is not the situation in this case. The dispute relating to recovery of possession by the tenant against the landlord cannot be tried under the provisions of Arbitration Act by the Arbitral forum but has to be decided only by Small Causes Court.
50. Learned counsel for the respondents placed reliance on the judgment of Supreme Court in case of Mansukhlal Dhanraj Jain and Ors., versus Eknath Vithal Ogale11, and in particular paragraphs 12, 14, 16 and 24 and would submit that the phrase 'relating to the recovery of possession' as found in Section 41(1) of the Small Cause Courts Act is comprehensive in nature. The proceedings which are concerned with the recovery of possession of suit property from the licensee and the suit for permanent 11 (1995) 2 SCC 665 42 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc injunction restraining the defendant from effecting forcible recovery of such possession from the licensee would squarely be covered under Section 41(1) of the Small Cause Courts Act.
51. Learned counsel for the respondents placed reliance on the judgment of Mahadev P. Kambekar v/s. Shree Krishna Woolen Mills Private Limited12, and in particular paragraph 26 and would submit that even if the tenancy between the landlord and the tenant would have been determined, the suit for recovery of possession would still come within the purview of Section 41(1) of the Small Cause Courts Act.
52. Learned counsel for the respondents placed reliance on the judgment of this Court in case of Nagin Mansukhlal Dagli versus Haribhai Manibhai Patel13 and in particular paragraphs 15 and 16 in support of the submission that even if relationship between the parties as landlord and tenant came to an end, the suit has to be still filed only before the Small Causes Court under Section 41 of the Presidency Small Cause Courts Act. He submits that in this case the relationship of the appellant with the respondents continued as landlord and tenant respectively.
53. Learned counsel for the respondents placed reliance on the judgment of Supreme court in case of Prabhudas Damodar 12 (2020) 14 SCC 505 13 1979 SCC OnLine Bom 29 43 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc Kotecha and Ors. versus Manhabala Jeram Damodar and Anr., 14 and in particular paragraph 28, 29(2) and 57 and would submit that all the suits and proceedings between the landlord and tenant or a licensor and licensee for recovery of possession of premises or for recovery of rent or licence fee can be tried and disposed of by the Small Causes Court exclusively. He submits that even if the appellant would have applied for recovery of possession of the premises in the new building from the respondent, the appellant was required to file such suit only in the Small Causes Court and not by invoking Arbitration Agreement. He submits that the Supreme Court has clearly held in the said judgment that all such proceedings between the landlord and tenant or licensor and licensee have to be tried by the Small Causes Court under one umbrella.
54. Learned counsel for the respondents placed reliance on the judgment of Supreme Court in case of Natraj Studios (P) Ltd. versus Navrang Studios and Anr.15, and in the particular paragraphs 17 and 24, in support of the submission that the Bombay Rent Act is a welfare legislation aimed at the definite social objective of protection of tenants against harassment by landlords in various ways. The object of conferring exclusive jurisdiction of certain Courts is pursuant to the social objective at which the legislative aims. He submits that the appellant being 14 (2013) 15 SCC 358 15 (1981) 1 SCC 523 44 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc the tenant of the respondent landlord, if the proceedings filed by the appellant for recovery of possession and rent, which can be tried by Small Causes Court exclusively are filed by the appellant before the Small Causes Court, it would achieve the social objective of conferring exclusive jurisdiction on Small Causes Court for adjudicating upon the dispute between the landlord and the tenant or vice-versa.
55. Learned counsel for the respondent placed reliance on the judgment of this Court in case of Central Warehousing Corporation, Mumbai vs.Fortpoint Automotive Pvt. Ltd., Mumbai,16 and in particular paragraphs 12, 25, 26, 30, 34 and 40 in support of the submission that under Section 41(1) of the Small Cause Courts Act being a non-obstante clause, the exclusive jurisdiction is vested in the Court of Small Causes to entertain and try all proceedings referred to therein. He submits that the appellant thus could not have invoked any arbitration agreement for referring the disputes to arbitration which disputes exclusively fell within exclusive jurisdiction of the Small Causes Court.
56. Learned counsel for the respondent placed reliance on the judgment of Supreme Court in case of Workmen of American Express International Banking Corporation v/s. Management of American Express International Banking Corporation,17 and in 16 (2010) 1 Mh LJ 658 17 (1985) 4 SCC 71 45 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc particular paragraph 4 and would submit that the Presidency Small Cause Courts Act being a social welfare legislation, the interpretation of those provisions have to be held strictly.
57. Mr. Naushad Engineer, learned counsel for the appellant in his rejoinder argument invited our attention to page 40 of the Appeal Memo i.e. averments made by the appellant in the arbitration petition filed before the learned Single Judge in paragraph 3(b), (g) and (h) and would submit that by these averments, the appellant had recited historical facts and had not claimed the reliefs in the said petition as an existing lawful tenant. He invited our attention to averments made in paragraph 3(f) and would submit that it was clearly averred by the appellant that pursuant to the representation and assurances given by the respondent no.1 to the appellant, a duly registered agreement dated 1st September, 2014 was executed between the respondent no.1 and the appellant wherein the respondent no.1 had inter-alia agreed to redevelop and construct the new building on the property. The respondents had agreed to allot to the appellant a new shop admeasuring 25.01 sq. mtrs. with loft together with amenities specified therein on ownership basis and free of costs in lieu of the said shop in the existing building for and at the consideration and of the terms and conditions recorded therein.
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58. In paragraph 3(g) of the petition, the appellant averred that the respondents had also categorically agreed to pay to the appellant monthly displacement rent for temporary transit accommodation of Rs.140/- per sq. ft. of the carpet area of the old shop per month for the period from the date of tenant vacating the old shop till handing over the new shop to the appellant by the respondent no.1 with occupation certificate during the pendency of the completion of the construction of the new building. The respondents had also agreed to handover possession of the new shop and the new building with all amenities with occupation certificate within the stipulated time prescribed in the said agreement. The said amount as and by way of displacement rent was to continue till the respondent no.1 would have handed over the possession of the new shop in the new building with occupation certificate. The said payment of displacement rent could not be confused with the rent payable by the appellant to the respondent no.1 as a tenant of the respondent no.1, which was being paid earlier.
59. Learned counsel also invited our attention to the averments made by the appellant in paragraph 4, 5, 6 and 8 of the arbitration petition and would submit that the petitioner had clearly submitted that there was valid and subsisting concluded contract between the parties being the agreement dated 12 th May, 2014. The said agreement had provided various obligations to be 47 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc complied with by the respondents. It is submitted that the respondents had also agreed to pay an amount of Rs.1 lakh per month as a compensation towards delay in completion of construction of new building behind the agreed period of 14 months from vacation of the existing building by the tenants i.e. from September 2015. There was delay of 62 months in completing the construction of new building by the respondents and thus the respondents were liable to pay an aggregate sum of Rs.62 lakhs to the appellant. In paragraph 8 of the said petition, it was averred that on failure of the respondents to make payment of the outstanding amount or to handover the new shop in the new building under the said agreement, the appellant was entitled to refer the dispute to the arbitration in accordance with the Clause 16 of the said agreement.
60. Learned counsel for the appellant also invited out attention to the notice issued by the appellant through his advocate invoking arbitration agreement and would submit that even in the said notice, the appellant had called upon the respondents to handover the possession of the redeveloped new shop with occupation certificate as the permanent alternate accommodation to the appellant and had also called upon the respondents to pay the displacement rent and various other amounts towards compensation for delay in completing construction of the new building with interest. He submits that in reply to the said notice 48 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc invoking arbitration agreement, the respondents did not raise any objection in the appellant invoking the arbitration agreement. Leaned counsel for the appellant invited out attention to the recital iv, ix and clause 2.11 at page 87 of the appeal paper book and would submit that it was clearly agreed with by the respondents that it would provide permanent alternate accommodation to the appellant on ownership basis in the new building.
61. Learned counsel invited our attention to first page of the said agreement at page 83 of the appeal paper book and would submit that the respondents had admittedly paid stamp duty under Article B25 (Agreement to Sale/Transfer/Assignment) and not as a tenancy agreement. He submits that the redevelopment carried out by the respondent no.1 was not under the provisions of the Rent Act pursuant to any notice issued by the Municipal Corporation for vacating the tenants with a obligation to handover the possession to the tenants in the new building as a tenant but has been carried out under the provisions of Regulation 33(7) of the Development Control Regulations. He invited our attention to the NOC issued by the MHADA on 13th May, 2011 annexed at page 83 of the appeal paper book in favour of the respondents directing the respondents that all the occupants of the old building shall be re-accommodated in the redeveloped building with specified area. It was also provided that during the period of reconstruction, the 49 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc respondents have to provide temporary transit accommodation to the occupiers of the old building at a specified rate. The respondents were required to surrender the surplus built-up area admeasuring 1414.41 sq. mtrs. to MBRRB Board.
62. The respondents were granted the benefit of FSI required for rehabilitation of existing occupiers plus 50% incentive FSI, whichever is higher, in accordance with the modified Development Control Regulation 33(7) and Appendix - III to the said Regulation 33(7). He submits that the appellant was thus not required to file any suit before the Small Causes Court for recovery of possession against the respondents in the new building as a tenant. He submits that none of the judgment relied upon by the learned counsel for the respondent no.1 had dealt with the claims made by a allottee of a permanent alternate accommodation on ownership basis in the new building without payment of any consideration.
63. Learned counsel distinguished each and every judgment relied upon by the Dr. Chandrachud, learned counsel for the respondent no.1. He once again placed reliance on the judgment delivered by full bench of this Court in case of Dattatray Krishna Jangam (supra) and would submit that none of the three tests laid down by the full bench of this Court in the said judgment for conferring jurisdiction on the Small Causes Court exclusively has 50 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc been satisfied in the facts of this case. He submits that the appellant had not invoked the arbitration agreement in the capacity as a tenant. The relationship between the appellant and the respondent no.1 in the said proceedings are not governed by the provision of the Rent Act under the said Agreement. The appellant had neither applied for recovery of any rent nor had impleaded the respondents as the landlords. The appellant had filed the said petition as an allottee of the permanent alternate accommodation on ownership basis. The appellant had not prayed for recovery of possession of the shop in the new building or for transfer of the shop in the new building on tenancy basis.
64. Insofar as the judgment of this Court in case of Tejbai Tejshi Dedhia and Ors. (supra) relied upon by Dr.Chandrachud, learned counsel for the respondents is concerned, the learned counsel invited our attention to paragraphs 1, 2 and 5 of the said judgment and would submit that in the said matter the proceedings were filed by the landlord invoking Section 13(1)(hh) of the Bombay Rent Act. The tenant had also filed a suit for specific performance and for monetary claim till delivery of the possession of the new premises as a tenant. In this case, the redevelopment of the property by the respondent no.1 is not under Section 13(1)(hh) of the Rent Control Act. No notice was issued by the Bombay Municipal Corporation for demolition of the building in that matter. The landlord tenant relationship 51 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc continued even qua the tenants in the newly constructed building and thus it was held by this Court in those facts that the said suit was relating to recovery of possession and thus fell within exclusive jurisdiction of the Small Causes Court. He also relied upon the paragraphs 12, 13 and 19 of the said judgment to demonstrate that the facts before this Court in the said judgment were totally different.
65. Learned counsel for the appellant relied upon the paragraph 5 of the judgment in case of Chandrakant Shankar Pradhan (supra) and would submit that the said judgment would assist the case of the appellant and not the respondent. The plaintiff in that case also was seeking to enforce his right to obtain the premises allotted to him in the new building on ownership basis. This Court had accordingly held that to such a suit, the provision of Section 28 of the Bombay Rent Act can never have any application.
66. Insofar as the judgment of this Court in case of ING Vysya Bank Ltd. (supra) is concerned, learned counsel invited our attention to paragraphs 1 and 16 of the said judgment and would submit that the said petition was filed under Section 9 of the Arbitration and Conciliation Act, 1996 for an injunction restraining the licensor from initiating proceedings for the recovery of possession of the licenced premises. In that matter, 52 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc the relationship between the parties as landlord tenant continued even in the new building. He submits that the facts before this Court in the said judgment were totally different and thus the said judgment is distinguishable in the facts of this case.
67. Learned counsel for the appellant distinguished the judgment of this Court in case of Brainvisa Technologies Pvt. Ltd. (supra). In the said judgment this Court had dealt with an application under Section 11(6) of the Arbitration and Conciliation Act, 1996 for appointment of an Arbitrator. This Court held that the applicant was never placed in possession of the premises and no reliefs relating to the recovery of possession of any immovable property/premises had been sought. The claim was for recovery of security deposit and seeking damages/ compensation which would not fall within exclusive jurisdiction of the Small Causes Court. He submits that the said judgment would not support the case of the respondents but would support the case of the appellant. In this case also the appellant has not sought any relief for recovery of possession of the tenanted premises in the building as a tenant but has prayed for recovery of new shop on ownership in the new building.
68. Learned counsel for the appellant distinguished the judgment of this Court in case of Globsport India Private Limited (supra). He invited out attention to paragraphs 17 and 18 of the 53 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc said judgment and would submit that the said judgment would support the case of the appellant and not the case of the respondent no.1.
69. Insofar as the judgment of the Hon'ble Supreme Court in case of Mansukhlal Dhanraj Jain (supra) is concerned, learned counsel for the appellant invited our attention to paragraph 1 of the said judgment and would submit that the issue for consideration of the Supreme Court in the said judgment was 'whether the suit filed by the plaintiff claiming the right to possess the suit premises as a licensee against licensor may be entertained only by the Small Causes Court as per Section 41(1) of the Presidency Small Cause Courts Act or whether it was cognizable by the City Civil Court, Bombay constituted under the Bombay City Civil Court Act'. The issue involved in these proceedings filed by the appellant are totally different. The relationship has to be in respect of the subject premises to fall under the provisions of Section 41 of the Presidency Small Cause Courts Act.
70. Learned counsel for the appellant distinguished the judgment of Supreme Court in case of Mahadev P. Kambekar (supra) and would submit that the Supreme Court in the said judgment approved the law laid down by this Court in case of Nagin Mansukhlal Dagli (supra) rejecting the submission of the learned counsel that once the tenancy is determined, such suits 54 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc would not not come within the preview of Section 41 of the Small Cause Courts Act. He submits that the appellant in this case had not applied for a declaration of the tenancy rights in the proceedings filed before the learned Single Judge under Section 9 of the Arbitration Act.
71. Learned counsel for the appellant distinguished the judgment of this Court in case of Nagin Mansukhlal Dogli (supra) on the same ground. He distinguished the judgment of Supreme Court in case of Prabhudas Damodar Kotecha and Ors. (supra). He invited out attention to paragraphs 2, 29 and 57 of the said judgment and would submit that the issues fell for consideration before the Hon'ble Supreme Court were different. The dispute was in relation to existing relationship of landlord tenant in the said matter before the Hon'ble Supreme Court.
72. Learned counsel for the appellant distinguished the judgment of Supreme Court in case of Natraj Studios (P) Ltd. (supra). He invited out attention to paragraph 1 and would submit that the issue before the Hon'ble Supreme Court was whether the licensee was deemed to have become tenant as on 1 st February, 1973 or not ? The dispute was relating to the licenced premises.
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73. Learned counsel for the appellant also distinguished the judgment of this Court in case of Central Warehousing Corporation, Mumbai (supra) and would submit that the issue involved before the full bench of this Court was 'whether in view of the provision of Section 5 of the Arbitration and Conciliation Act, 1996, if any agreement between the licensor and licensee containing a clause for arbitration, the jurisdiction of the Small Cause Courts Act under the Presidency of Small Cause Courts Act would be ousted or not'? The full bench of this Court held that inspite of arbitration agreement between the parties and non- obstante clause in Section 5 of the Arbitration and Conciliation Act, 1996, the exclusive jurisdiction of the Small Causes Court to try and decide the dispute specified in Section 41 of the Presidency of Small Cause Courts Act is not ousted. He submits that the said judgment would not apply to the facts of this case, since the dispute raised by the appellant would not fall under Section 41 of the Presidency of Small Cause Courts Act.
74. Insofar as the reliance placed by the learned counsel for the respondent no.1 on clause (ix) at page 89 of the Agreement of the appeal paper book is concerned, he submits that the respondents had already agreed to give the permanent alternate accommodation to the appellant under the said agreement dated 12th May, 2014 itself. In any event, the said clause has to be read with other clauses of the agreement which confer ownership rights 56 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc in the appellant in the new building constructed by the respondents. The respondents have already constructed the new building. The cause of action of the appellant was thus for recovery of possession of the new shop in the new building on ownership basis and for payment of arrears of displacement rent and the compensation for delay in handing over possession of the new shop in the new building on NOC basis. He submits that the learned Single Judge has not considered all the clauses of the said agreement entered into between the parties while holding that the said petition filed by the appellant under Section 9 was not maintainable. He submits that the view taken by the learned Single Judge is also contrary to law laid down by the Hon'ble Supreme Court, this Court and also the provision of Section 41 of the Presidency of Small Cause Courts Act, Section 28 of the Bombay Rent Act and Section 33 of the Maharashtra Rent Control Act.
REASONS AND CONCLUSION :-
75. The question that fell for consideration of this Court is (i) whether the reliefs sought by the appellant (original petitioner) in the petition filed under Section 9 of the Arbitration and Conciliation Act for recovery of monthly displacement rent for temporary accommodation for 44 months and (ii) for recovery of Rs.62 lakhs being monthly compensation for delay of 62 months against the respondents in handing over possession of the new 57 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc shop in the new building on ownership and (iii) whether the dispute relating to recovery of possession by the appellant from the respondent no.1 in respect of new shop in the new building on ownership basis could be tried exclusively by Small Causes Court or could be tried by the Arbitral Forum under the provision of the Arbitration and Conciliation Act, 1996 or not ?
76. The learned Single Judge has disposed of the arbitration petitions filed by the appellant under Section 9 of the Arbitration Act by holding that until there is a change of ownership in the suit premises, execution of the agreement will not operate to oust the provisions of the Maharashtra Rent Control Act, 1999 or Section 41 of the Presidency of Small Cause Courts Act, 1882. The dispute resolution procedure contemplated in the agreement must be subordinate to the exclusive jurisdiction of the provisions of Presidency of Small Cause Courts Act, 1882.
77. Learned Single Judge held that although the construction is complete, the occupation certificate is not received and no notice has been issued by the respondents. Whatever may be the other remedies in that regard, the situation in law is that the legal status of the appellant cannot be said to have changed to that of a full owner which has minimum consequence in law because the original relationship of landlord and tenant is not yet displaced. Learned Single Judge strongly placed reliance on clause (ix) of the 58 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc agreement entered into between the parties in the impugned order.
78. A perusal of the agreement dated 12 th May, 2014 entered into between the appellant and the respondents indicates that the respondents have been described as the owner/developer whereas the appellant has been described as the tenants. In recital (e) of the said agreement, it is provided that the owner had agreed to develop the said property on the terms and conditions mentioned in accordance with the IOD dated 27th February, 2003, commencement certificate dated 29th October, 2005 and approved plan dated 26th November, 2010. The respondents had desire to demolish the existing building and in its place to construct a new building as per plans approved by the Mumbai Municipal Corporation in accordance with the Regulation 33(7) of the Development Control Regulation for Greater Bombay, 1991. With a view to facilitate the demolition of the building and construction of new building as per approved plan of the Municipal Corporation, the tenant had agreed to vacate the existing tenanted shop-cum-office and to handover the possession of the same to the owner/developer for the purpose of demolition and redevelopment.
79. In recital (h), it was provided that the owners/developers offered to allot to the tenant by way of absolute ownership 59 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc permanent alternate accommodation in lieu of the existing tenancy shop-cum-office, being a self-contained shop-cum-office on ownership basis free of costs in the new building. The new building was described as rehabilitation building to be constructed in lieu of the existing building along with non designated car parking spaces as per MCGM Rules in the common parking space other than visitors parking space in the residential building which will be known as Tenant's New Ownership Shop- cum-Office on the terms and conditions mutually agreed between the parties.
80. Under recital (vii) of the said agreement, it was provided that the tenants will have to vacate and handover the existing shop-cum-office within the time prescribed. The tenant had given irrevocable written consent dated 13th December, 2005 to the owner/developer and on the basis of which the owner/developer had obtained IOD and CC from Municipal Corporation. The said consent given by the tenant was an irrevocable consent to the owner/developer and was to be treated as a consent required under the scheme of re-development.
81. In recital (ix) of the said agreement, it was provided that 'on the date of the tenant being offered the new constructed shop- cum-office as and by way of permanent alternate accommodation 60 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc on ownership basis and free of costs in a new constructed building by a notice in writing intimating the tenant to take possession of the same on or before expiry of 30 days from the date of receipt of such notice along with occupation certificate in respect of tenant's new shop-cum-office and/or the tenant taking physical possession of the tenant's new shop-cum-office, the tenancy of the tenant in respect of existing shop-cum-office shall ipso facto and automatically stand converted to ownership rights in respect of new shop-cum-office on such date of taking possession by the tenant which shall be handed-over by the owner/developer to the tenant'. The said clause further provided for payment of penalty of Rs.50,000 per month payable by the tenant to the developer in case the tenant does not shift to the newly constructed shop-cum- office on the expiry of 30 days from the date of receipt of the notice along with the occupation certificate.
82. In recital (xi) of the said agreement, it was provided that the new building to be constructed by the owner/developer in place of building no. 74B shall be fit for occupation in all respect including continue electric supply, various other amenities and occupation certificate being opted by the owner/developer. In clause 2.4 of the said agreement, the owner/developer agreed and confirmed that upon completion of construction of new building in place of building no.74B and the same being fit for occupation for the tenants, the possession of the Tenant's New Shop-cum-Office shall 61 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc be handed-over to the tenant on ownership basis free of costs and without any consideration whatsoever. The tenant can park his vehicle in the open space in the compound of the society in the space designated by the owner/developer.
83. In clause 2.5 of the said agreement, it was provided that the owner/developer agreed that the tenancy of the tenant in respect of the existing shop shall not be extinguished on demolition of the existing building no. 74B and shall continue till the tenant is intimated by a notice in writing that the new shop-cum-office on ownership basis as and by way of permanent alternate accommodation in the newly constructed building is ready and fit for occupation with amenities along with occupation certificate in respect of the Tenant's New Shop-cum-Office.
84. The respondents were entitled to demolish the entire building after receiving the vacant possession from the tenant within the time limit specified in recital (x) of the said agreement. The tenant was not required to pay any consideration cost in respect of the new shop-cum-office agreed to be constructed and handed-over to the tenant under the said agreement by the respondent no.1 Under Clause 2.11, the appellant became entitled to the new shop-cum-office on ownership basis admeasuring 25.01 sq.mtrs. of internal carper area. Under Clause 4.8 of the said agreement, the appellant agreed that before taking 62 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc the possession of the alternate/transit shop-cum-office premises, the appellant shall pay Rs.250 towards the membership/share charges to the respondent no.1 for the registration of the proposed Co-operative Housing Society.
85. Under Clause 5.1 of the said agreement, the respondents agreed and undertook to pay the displacement rent being the rent for 11 months of the temporary alternate accommodation which the appellant was required to obtain on his own. The respondents also issued a cheque for further three months rent being the extension period. Under Clause 5.2 of the said agreement, the respondents agreed to pay compensation @ Rs.2 lakhs per month per tenant from the commencement of 15 th month beyond the said period of 14 months till occupation of the new shop-cum-office was given and complete in all respect, fit for occupation, with all amenities as recorded in the said agreement. The respondents also agreed to pay Rs.3 lakhs toward corpus fund to ensure zero maintenance of the property tax to be kept in deposit with a bank in the name of the registered society. Under clause 16.1 of the said agreement, it was provided that in case of any dispute or differences between the parties relating to the said agreement the same shall be referred to arbitration.
86. It is not in dispute that the respondents did not hand over possession of the new shop-cum-office in the new building within 63 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc the time prescribed under the said agreement to any of the appellants. The appellant had accordingly issued a notice through his advocate on 19th June, 2019 and called upon the respondents to pay Rs.11,11,292/- and also Rs.46 lakhs towards monthly rent and compensation in delay in completing construction with interest. In paragraph 12 of the said letter, it was provided that the dispute and differences between the parties had arisen. The appellant nominated a Counsel of this Court to act as a sole Arbitrator and called upon the respondents to approve the name of the learned prospective Arbitrator.
87. The respondents through their advocate's letter dated 27 th July, 2019 replied to the said notice invoking arbitration agreement. In the said reply, the respondents contended that the appellant had been accepting the agreed rent paid by him without any comment, demand or objection. The demand of the appellant for compensation of Rs.1 lakh was not valid and was nullified. In paragraph (c) of the said letter, it was contended that the respondents had to apply and to submit revised plans under new Development Control Regulation, Greater Mumbai which was under consideration of the authorities which was one of the major reason for delay/extension of work. In paragraph (h), the respondents stated that they had no objection to invoke arbitration in accordance with Clause 16 of the agreement. The respondents however did not agree to the name of Mr. Nirman 64 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc Sharma, Advocate suggested by the appellant to act as a sole Arbitrator. The respondents suggested the name of Mr. Himanshu Kode, Advocate or alternatively Mr. Balbhim Patil, Advocate. The appellant by his advocate's letter dated 17 th March, 2020 denied the allegations made by the respondent no.1 in their advocate's letter dated 27th July, 2019 and called upon to pay Rs.13,41,818.40/- and Rs.54 lakhs under different heads.
88. In the affidavit-in-reply filed by the respondents before the learned Single Judge dated 2nd December, 2020, in paragraph 3, the respondents contended that the agreements were executed between the appellant and the respondents for redevelopment. In paragraph 5, it was stated that if the appellant was ready and willing to vacate the temporary alternate accommodation then respondents were ready to pay monthly displacement rent as per the terms of the agreement entered into between the parties. In paragraph 6 of the said affidavit, it is stated that the shops are ready but since occupation certificate has not been issued in view of one of the tenant having filed the suit before Small Causes Court and the same is pending, the shop of that tenant has not been demolished and therefore occupation certificate could not be granted by the Corporation. The respondents could not handover shop without occupation certificate to the petitioner as per Clauses 3 and 11.
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89. In paragraph 7 of the said affidavit, it was stated that if the appellant was ready and willing to take possession of the shop on as is where is basis, the respondents were ready and willing to handover the same within six weeks from the date of the said letter after installation of electric meter and after completing other formalities. In paragraph 8 of the said affidavit, it was stated that after executing the said agreement, respondents had given the said property to the developer namlely Darshan Developers but due to covid-19 he could not come forward for further development and the project was thus stuck and stopped till new developer would come and till old agreement with the developer gets cancelled. In paragraph 10, it was stated that in addition to the temporary alternate accommodation, the respondent no.1 paid Rs.19,51,000 as compensation for height to the petitioner.
90. In paragraph 11, the respondents stated as to how much amount had been paid to the petitioner on different dates between 2014-2015 and 2018-2019. In paragraph 13, it is stated that there was a balance amount of Rs.9,52,536/-. In paragraph 14, it is stated that since the project was stopped and the occupation certificate had not been issued due to unavoidable circumstance and due to market situation and fund issued, respondents were ready and willing to pay one current month rent and one current month arrears of rent till occupation certificate was issued. In paragraph 15, it is stated that if the appellant was ready and 66 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc willing to take the shop, he will not have to pay an arrears of the electricity bills. The respondents would install electricity meter within one month and would handover the possession on as is where is basis to the petitioner. If the appellant was not willing to take possession, the respondents would continue the rent as agreed till date of possession. In the entire affidavit, the respondents did not raise any objection in respect of the maintainability of the petition filed by the petitioner under Section 9 of the Arbitration Act on the ground that dispute could be tried only by Small Causes Court.
91. The petitions filed by the appellant appeared before the learned Single Judge on 25th November, 2020. The learned Single Judge directed the respondents to disclose the amount that was payable according to them to each of these appellants in respect of their various premises and also a commitment in regard to the displacement compensation to be paid from November 2020 onwards. In paragraph 2 of the said order, the learned Single Judge recorded that there is also an Arbitration provision in each of these agreements. A perusal of the judgment rendered by the learned Single Judge indicates that the respondents raised an issue of jurisdiction only across the bar and relied upon the judgment of this Court in case of Brainvisa Technologies Pvt. Ltd. (supra) and judgment of full bench of this Court in case of Central Warehousing Corporation, Mumbai (supra).
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92. On perusal of the provisions in the agreement entered into between the parties and the averments in the petition under section 9 of the Arbitration Act, the affidavit in reply therein and the correspondence annexed, in our prima-facie view the agreement entered into between the appellant and the respondents was not for creating any tenancy rights in the new shops to be constructed in the new building but was for allotment of the tenements in the new building on ownership basis without payment of any cost. There is thus no question of considering the appellant as a tenant of the tenements to be constructed in the new building. The appellant was allotted permanent alternate accommodation in the new building under a redevelopment scheme propounded by the respondents.
93. In this back drop of the facts, we shall now consider whether the dispute which was the subject matter of the notice invoking arbitration agreement and the petition filed by the appellant under section 9 of the Arbitration Act can be tried exclusively only by the Small Cause Courts under section 41 of the Presidency, Small Cause Courts Act or under the provisions of the Maharashtra Rent Control Act, 1999 or the same can be tried in the arbitral proceedings. Learned counsel appearing for both the parties have cited several judgments for consideration of this Court in support of their rival contention. The parties have also 68 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc relied upon the provisions of the Presidency, Small Cause Courts Act and also the Maharashtra Rent Control Act, 1999 in support of their rival contention.
94. It is not in dispute that the premises which was in possession of the appellant as a tenant were commercial premises. A Division Bench of this Court in the judgment in case of Tejbai Tejshi Dedhia (supra) had considered an appeal arising out of the order passed by the learned single Judge in the suit whereby the suit had been decreed in favour of the respondents against the appellant therein. The Municipal Corporation had issued a notice for demolition of the building. Since two of the occupants refused to hand over possession, the landlord had filed a suit for eviction in the Court of Small Causes under section 13(i)(hh) of the Bombay Rent Act, 1947. The parties thereafter had entered into an agreement by which the respondent tenant had agreed to vacate the premises in its occupation and to surrender the leasehold rights.
95. The appellant in that case agreed to allot on rental basis an area of about 1200 sq.ft. carpet area along with various amenities in the new building to be constructed at the place of old building. The appellant landlord did not hand over possession of the tenement in the new building. The tenant had accordingly filed a suit for specific performance of the agreement and for 69 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc compensation till the delivery of possession of the new premises. The Trial Court decreed the said suit which decree was impugned. A Division Bench of this Court in the facts and circumstances of that case after construing the plaint held that the plaint would disclose that the agreement was executed between the landlord and tenant, the appellant being landlord and the respondent being tenant.
96. The parties therein had agreed that in order to enable the landlord to demolish the existing structure and to construct a new building in the property, certain arrangements were arrived at between the parties with regard to obtaining vacant possession of the existing premises in occupation of the respondents and to provide with permanent alternate accommodation in the new building to be constructed by the landlord in the said property. The parties had accordingly entered into the said agreement recording these terms. In paragraph 12 of the said judgment, this Court observed that the agreement refers to the existing relationship of the landlord tenant in relation to the existing premises and further continuation of such relationship in relation to the premises in the new building to be constructed on demolition of the old building.
97. This Court accordingly held that since the parties had undisputedly disclosed a clear admission on their part about 70 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc existence of landlord and tenant relationship in respect of the premises which sought to be vacated in terms of the agreement and further disclosed an intention to continue the said relationship in respect of the new premises in the new building on completion of the construction thereon in place of the old building to be demolished, it could not be said that such an action would be merely for specific performance of the agreement for continuation of the existing leasehold rights.
98. In the facts of this case, the parties have not agreed that the appellant would be continued to be a tenant even in respect of the new shop to be constructed in the new building which would be handed over to the appellant by the respondents after completion of the construction and after obtaining the occupancy certificate. The new shops agreed to be handed over to the appellant by the respondents in the new building are to be allotted by way of permanent alternate accommodation on ownership basis and not as a tenant. The facts before the Division Bench of this Court in case of Tejbai Tejshi Dedhia & Ors. (supra) thus are clearly distinguishable in the facts of this case and would not advance the case of the respondents.
99. The issue before this Court in the judgment delivered by the learned single Judge in case of Chandrakant Shankar Pradhan 71 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc (supra) was that the issue of jurisdiction must be determined on the basis of the averments made in the plaint. In our view, the said judgment would not apply to the facts of this case. The appellant has yet to file the statement of claim in the arbitral proceedings. Be that as it may, the correspondence exchanged between the parties and the pleadings before the learned single Judge would prima-facie indicate that the appellant has demanded the possession of the new tenements to be handed over to the appellant as permanent alternate accommodation in the new building free of costs and for displacement rent and compensation. The said judgment delivered by the learned single Judge of this Court in case of Chandrakant Shankar Pradhan (supra) thus would not advance the case of the respondent no.1.
100. A learned single Judge of this Court (as His Lordship then was of this Court) in case of ING Vyasya Bank Ltd. (supra) had considered the issue whether the suit in substance and in essence is a suit relating to recovery of possession or the recovery of license fees, rent or other charges between a landlord and tenant or a licensor or licensee. If the suit relates to the recovery of possession, it is a suit to which section 41(1) of Presidency Small Causes Court applies notwithstanding the fact that some of the reliefs or a portion of the cause of action is structured around the claim for specific performance. The pleadings must be considered as a whole seeking an injunction restraining the licensor from 72 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc terminating the agreement of license and acting upon a communication calling upon the licensee to hand over vacant possession and in particular, restraining the licensor from initiating proceedings for the recovery of possession of the licensed premises.
101. In the said matter an injunction was also sought restraining the licensor from disturbing the use and occupation of the premises by the licensee, from entering into any third party rights in respect of the licensed premises. There was no issue involved in the said matter where the tenant was being offered the permanent alternate accommodation in the new building, on ownership basis. Admittedly the rights claimed by the licensee in the said matter was exclusively claimed as a licensee and not as an allottee of permanent alternate accommodation in the new building. The said judgment thus is clearly distinguishable in the facts of this case and would not advance the case of the respondents.
102. This Court in case of Brainvisa Technologies Private Limited (supra) had dealt with an application filed under section 11(6) of the Arbitration & Conciliation Act 1996 and held that the suit for recovery of security deposit does not constitute a suit for recovery of "license fee or charges or rent therefor". The license fees, charges and rent are periodical payments made for use and occupation. The security deposit is a form of security which the 73 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc landlord as licensor obtains from the licensee to whom the premises are licensed for occupation. The said order was passed by the designate of the Hon'ble Chief Justice prior to the amendment to section 11(6) of the Arbitration Act. By 2015 Amendment, the words Chief Justice or his designate by 'Court' were substituted by 'Court'. The said order was thus not a precedent. Be that as it may, the said order even otherwise would not advance the case of the respondents. The applicant in the said matter was never in possession of the premises. Neither any relief relating to recovery of possession of any immovable property was sought nor any relief for recovery of license fee, charges or rent had been sought. Learned designate Judge of the Hon'ble Chief Justice had accordingly held that the recovery of security deposit would not fall within the jurisdiction of the Small Cause Courts.
103. Hon'ble Supreme Court in case of Mansukhlal Dhanraj Jain (supra) had considered the situation where the plaintiff had contended that he was the licensee of the said premises and the defendant was the licensor and on that basis he wanted assistance of the Court to protect his possession. In the said proceedings, the plaintiff had claimed right of possession in the suit premises as a licensee against the licensor, who was threatened to disturb the possession of the plaintiff licensee without following due process of law. It is held by the supreme Court that the phrase "relating to recovery of possession" as found in section 41(1) of the Small 74 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc Cause Courts Act, 1882 is comprehensive in nature and takes in its sweep all types of suits and proceedings which are concerned with the recovery of possession of suit property from the licensee and thus the suit would fall under section 41(1) of the Small Cause Courts Act. In this case, the respondent no.1 as a landlord has not filed any proceedings against the appellant as a tenant or licensee for recovery of possession. The said judgment is thus clearly distinguishable in the facts of this case and would not advance the case of the respondent no.1.
104. Hon'ble Supreme Court in case of Mahadev P. Kambekar (Dead) (supra) considered a situation where the plaintiff had claimed to be licensee of the suit land whereas the defendant claimed to be the owner / licensor of the suit land. The dispute had arisen between the parties. The plaintiff had filed a civil suit against the defendant in that case claiming specific performance of the contract (lease deed) in relation to the suit land. The issue before the Hon'ble Supreme Court was that if the tenancy is determined whether the said suit would still come within the purview of section 41 of the Small Cause Courts Act or not. Hon'ble Supreme Court approved the view taken by this Court in case of Nagin Mansukhlal Dagli (supra) rejecting the contention that once the tenancy is determined, such suits would not come within the purview of section 41 of the Small Cause Courts Act. The facts before the Hon'ble Supreme Court in the said judgment 75 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc were totally different and are clearly distinguishable in the facts of this case. In this case the appellant claims to be the allottee of the permanent alternate accommodation in respect of the shop constructed in the new building on ownership basis and not as a tenant. The tenancy agreement between the appellant and the respondents was substituted by the allotment of shop in the new building on ownership basis without payment of any consideration or costs.
105. A Division Bench of this Court in case of Nagin Mansukhlal Dagli (supra) had considered the issue whether the suit for recovery of license fee or charge may lie either when a license subsists or after it has come to an end or not. This Court in the said judgment held that merely because the lease or license has been terminated, the suit for the reliefs for recovery of possession or for rent or compensation would still fall under section 41 of the Presidency Small Cause Courts Act. The said judgment is clearly distinguishable in the facts of this case and would not advance the case of the respondent no.1 for the reasons recorded in paragraph 104 aforesaid.
106. Hon'ble Supreme Court in case of Prabhudas Damodar Kotecha and Others (supra) had considered the question whether the suit filed by the licensor against gratuitous licensee under section 41(1) of the Presidency Small Cause Courts Act as 76 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc amended by Maharashtra Act 19 of 1976 was maintainable before the Small Cause Courts, Mumbai or not. Hon'ble Supreme Court considered the statement of objects and reasons of 1996 Amendment and held that clubbing of the expression "licensor and licensee" with "landlord and tenant" in section 41(1) of the Presidency Small Cause Courts Act and clubbing of causes relating to recovery of license fees is only with a view to bring all the suits between the "landlord and tenant" and the "licensor and licensee"
under one umbrella to avoid unnecessary delay, expenses and hardship. In that context, Hon'ble Supreme Court held that the act of Legislature was to bring all suits between "landlord and tenant" and "licensor" and licensee" whether under the Rent Act or under the Presidency Small Cause Courts under one roof. Since this Court is of the view that the nature of relief sought by the appellant in the petition filed under section 9 of the Arbitration Act was not a relief falling under the provisions of section 41(1) of the Presidency Small Cause Courts Act or the Maharashtra Rent Control Act, the said judgment of the Hon'ble Supreme Court is distinguishable in the facts of this case and would not advance the case of the respondents.
107. Insofar as the judgment of the Hon'ble Supreme Court in case of Natraj Studios (P) Ltd. (supra) relied upon by Dr.Chandrachud, learned counsel for the respondents is concerned, Hon'ble Supreme Court in the said judgment had 77 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc considered the effect of section 15-A inserted by amendment, Maharashtra Act 17 of 1973 stating that any person who was in occupation of any premises on 1st February, 1973 as a licensee was deemed to have become, on that date, for the purposes of Act, a tenant in respect of the premises or part thereof in his occupation. The appellant had filed an application under section 33 of the Arbitration Act, 1940 before this Court for a declaration that the arbitration clause in leave and licence agreement was invalid, in- operative etc. The said application was dismissed by this Court on the ground that this Court had no jurisdiction to determine the alleged rights, if any, of the appellant as a tenant.
108. Hon'ble Supreme Court in the said judgment held that the Bombay Rent Act is a welfare legislation aimed at the definite social subjective of protection of tenants against harassment by landlords in various ways. It is a matter of public policy. The scheme of the Act shows that the conferment of exclusive jurisdiction on certain Courts is pursuant to the social objective at which the legislation aims. Public policy requires that contracts which nullify the rights conferred on tenants by the Act cannot be permitted. Public policy requires that parties cannot also be permitted to contract out of the legislative mandate which requires certain kind of disputes to be settled by Special Courts constituted by the Act. In that context, Hon'ble Supreme Court held that prima-facie the agreement between the parties whose 78 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc rights are regulated by the Bombay Rents Act cannot be recognised by a Court of law. Exclusive jurisdiction is given to Court of Small Causes and the jurisdiction is denied to other Courts (1) to entertain and try any suit or proceedings between the landlord and tenant relating to recovery of rent or possession of any premises, (2) to try any suit or proceedings between a licensor and a licensee relating to recovery of license fee or charges, (3) to decide any application made under the Act and, (4) to deal with any claim or question arising out of the Act or any of its provisions.
109. In our view since none of the reliefs claimed by the appellant falls under those four test laid down by the Hon'ble Supreme Court to confer exclusive jurisdiction to the Court of Small Causes, the principles laid down by the Hon'ble Supreme Court in the said judgment would not apply to the facts of this case. There is no dispute about the proposition of law laid down by the Hon'ble Supreme Court in the said judgment.
110. A full Bench of this Court in case of Central Warehousing Corporation, Mumbai (supra) has answered the question referred to the Full Bench i.e. "Whether in view of the provisions of section 5 of the Arbitration & Conciliation Act, 1996, if any agreement between the licensor and licensee contains a clause for arbitration, jurisdiction of the Small Cause Courts under the Presidency Small 79 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc Cause Court Act, 1882 would be ousted ?". Full Bench of this Court answered the said question by holding that section 41(1) of the Presidency Small Cause Court Act is Special law in turn has constituted special Courts for adjudication of disputes specified therein between the licensor and licensee or landlord and tenant. It is held that the expression "or any other law for the time being in force" appearing in section 41(2) will have to be construed to mean that such law should provide for resolution of dispute between the licensor and licensee or landlord or tenant in relation to immovable property or licensee fee thereof, to which immovable property, provisions of that Act at applicable.
111. The full Bench of this Court accordingly held that even if the license agreement contains arbitration agreement, exclusive jurisdiction of the Court of Small Causes under section 41 of the Presidency Small Cause Courts is not affected in any manner and such arbitration agreement in such cases would not be valid and inoperative on the ground that it would be against the public policy to allow parties to contract out of exclusive jurisdiction of the Small Cause Courts by virtue of section 41 of the Presidency Small Cause Court Act. In our view, since none of the reliefs sought by the appellant in the said proceedings under section 9 of the Arbitration Act and the nature of dispute carved out in the notice invoking arbitration agreement falls within the exclusive jurisdiction of the Court of Small Causes and such reliefs can be 80 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc exclusively tried only by the arbitral forum, the said arbitration agreement recorded in the agreement cannot be declared as unenforceable or contrary to statute or the public policy. The said judgment of the Full Bench of this Court in case of Central Warehousing Corporation, Mumbai (supra) thus would not assist the case of the respondents.
112. Insofar the judgment of the Hon'ble Supreme Court in case of Workmen of American Express International Banking Corporation supra) relied upon by the learned counsel for the respondents is concerned, Hon'ble Supreme Court in the said judgment has held that the words occurring in statutes of liberal import such as social welfare legislation and human rights' legislation are not to be put in Procrustean beds or shrunk to Lilliputian dimensions. In construing these legislations the imposture of liberal construction must be avoided and the prodigality of its misapplication must be recognised and reduced. There is no dispute about proposition of law laid down by the Hon'ble Supreme Court in the said judgment. Though Arbitral Forum has jurisdiction to adjudicate and grant the reliefs sought by a party, such party cannot be referred to a Court on the ground that an Act conferring jurisdiction on a Court is social welfare legislation though such Court would have no jurisdiction to grant such reliefs claimed in arbitration. The said judgment of the Hon'ble Supreme Court in case of Workmen of American Express International Banking Corporation (supra) thus would not advance the case of the respondent no.1.
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113. This Court in case of Chandrakant Shankar Pradhan (supra) had considered the Notice of Motion in a suit filed by the plaintiff against the landlord for specific performance of the agreement, compensation in sum of Rs. 6,00,000/- and compensation for abnormal delay caused by the defendants in completing construction of the building and for various reliefs. The said suit was resisted on the ground that those reliefs could be considered only by the Small Causes Court in view of Section 28 of the Bombay Rent Act. The learned Single Judge of this Court in the said judgment has held that the issue of jurisdiction must be determined on the basis of averments made in the plaint. It was the case of the plaintiff in the plaint that the tenancy of the plaintiff was in respect of the old room in the old building. The tenancy had come to an end when the old room was demolished.
114. The plaintiff in the said suit was seeking to enforce his right to obtain the premises allotted to him in the new building on ownership basis. This Court accordingly held that to such a suit, the provisions of Section 28 of the Bombay Rent Act, can never have any application. There was no subsisting relationship of landlord and tenant between the plaintiff and defendants. When the suit agreement was specifically enforced, the plaintiff would 82 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc be able to acquire the allotted accommodation in the new building on ownership basis and not as a tenant. In our view, the facts in this case are identical to the facts before this Court in case of Chandrakant Shankar Pradhan (supra). We agree with a view expressed by the learned Single Judge of this Court in the said judgment and do not propose to take a different view.
115. In this case, the appellant had filed those proceedings under Section 9 for various interim measures which are in aid of the final reliefs which would be for recovery of possession of the new shop in the new building constructed by respondent No.1 on ownership basis free of cost and not for continuation of the tenancy in the shop to be constructed in the new building.
116. This Court in case of Rite Choice Trading Company (supra) has held as under:-
A provision in the Statute ousting jurisdiction of the Court must receive strict construction. Where the Civil Court's jurisdiction is barred expressly, it must mean that it is confined to the matters connected therewith or covered thereby. The adjudicatory forum provided therein must be competent to resolve the dispute. Jurisdiction of the Civil Court is plenary in nature. A casus omissus cannot be supplied by the Courts to oust jurisdiction of Civil Court. Court which cannot give relief claimed for has no jurisdiction to deal with the case. When a special tribunal is 83 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc created under special Statute, jurisdiction of Civil Court is ousted only in respect of those reliefs which could be granted by special tribunals in special Statute and in other respects, jurisdiction of civil court is not ousted. A plea of bar of jurisdiction of Civil Court must be considered having regard to the contention raised in the plaint. The averments disclosing cause of action and the reliefs sought for therein must be considered in its entirety. The Court would not be justified in determining the question one way or the other, only having regard to the reliefs claimed dehors the factual averments made in the plaint. The Court has to consider what in substance and not merely in form is the nature of the claim made in the Suit and the underlying object in seeking the relief therein.
117. The principles laid down in the said judgment delivered by the learned Single Judge of this Court in case of Rite Choice Trading Company (supra) would apply to the facts of this case. The proceedings were filed by the appellant under Section 9 of the Arbitration Act. The statement of claim is yet to be filed before the Arbitral Forum. The Court has to see in this case the reliefs sought in the Petition, the averments made in the Petition under Section 9 and the cause of action reflected in the notice invoking arbitration agreement for arriving at a conclusion whether those reliefs sought by the appellant could at all be considered or adjudicated upon under a Special Statute by Court of Small Causes or not. If 84 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc such reliefs sought by the appellant cannot be granted by the Small Causes Court under Section 41 of the Presidency Small Causes Court Act, 1882 read with Maharashtra Rent Control Act, the jurisdiction of the Arbitral Forum for granting substantive relief and jurisdiction of the High Court under Section 9 of the Arbitration Act to grant interim measures cannot be ousted by referring the parties to Small Causes Court.
118. In our view, the learned Counsel for respondents could not have placed reliance on few lines from the Petition filed by the appellant under Section 9 of the Arbitration Act to canvass that the appellant themselves had averred that he was tenant of respondents. A perusal of the averments made in the Petition under Section 9 of the Arbitration Act filed by the appellant indicates that the appellant had given a background of his relationship with respondents followed by the reliefs proposed to be sought in the said Petition under Section 9 and the cause of action for seeking possession of the premises allotted in the new building as and by way of permanent alternate accommodation, ownership and free of cost. The entire Petition disclosing cause of action and reliefs sought has to be considered in its entirety and not by picking up few averments out of context in the petition for the purpose of ousting the jurisdiction of the arbitral forum and the Court hearing Petition under Section 9 of the Arbitration Act.
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119. The Division Bench of this Court in case of Govindram Salamatrai Bachani (supra) has held that it is well established cannon of construction that when the legislature deprives the High Court of its jurisdiction the language used by the legislature must be strictly construed. Equally so, when the legislature confers special jurisdiction upon a subordinate Court, that language must also be construed strictly. In our view, the principles laid down by this Court in the said judgment would apply to the facts of this case. Respondents who have sought to oust the jurisdiction of this Court from granting any interim measures under Section 9 of the Arbitration Act and consequently jurisdiction of the Arbitral Forum to grant the substantive relief have to satisfy this Court beyond reasonable doubt that such reliefs as sought by the appellant can be granted exclusively only by the Court of Small Causes and the jurisdiction of this Court under Section 9 and of the Arbitral Forum if and when the matter is referred to arbitration is ousted. The provisions of Section 41 of Presidency Small Causes Court Act, 1882 read with the provisions of Bombay Rent Act thereby ousting the jurisdiction of other Courts or the Arbitral Forum has to be construed strictly.
120. This Court in case of Globsport India Pvt. Ltd. (supra) had while dealing with the Petition under Section 34 of the Arbitration Act impugning an Arbitral Award dealt with the situation where in the statement of claim filed by the claimant before the Arbitral 86 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc Tribunal, the claimant had prayed for recovery of the damages/ compensation arising out of the lawful termination of the leave and licence agreement and amenities agreement during the lock in period. This Court accordingly held that the claim for recovery of compensation/damages would not fall under Section 41 of the Presidency Small Cause Courts Act, 1882 and thus Small Causes Court will have no jurisdiction to entertain such claim.
121. This Court has also considered the fact that under the Leave and Licence Agreement entered into between the parties therein, the licensee had agreed to pay compensation in case of premature termination of leave and licence agreement during lock in period. Such provision or payment of compensation was not by way of rent which was payable during the existence of the leave and licence agreement. This Court accordingly rejected the contention of the respondent that the claim was for recovery of rent. In our view, the principles laid down by this Court in the said judgment in case of Globsport India Pvt. Ltd. (supra) delivered by one of us (R.D. Dhanuka, J.) applies to the facts of this Case. The reliefs in the Petition filed by the appellant under Section 9 for recovery of the displaced compensation and for other reliefs of the similar nature would not fall under Section 41 of the Presidency Small Causes Court Act, 1882 or under any of the provisions of the Bombay Rent Act. We do not propose to take a different view in the matter than the view taken by the learned Single Judge of this 87 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc Court in the said judgment.
122. This Court in case of M/s. Hakimraj Jaichand Holdings Pvt. Ltd. (supra) has considered Section 41 of the Presidency Small Causes Court Act, 1882 and has held that the said provision only applies in cases where the suit is related to "recovery of possession" of premises or for demand of compensation under the leave and licence agreement. In our view, the principle laid down by the learned Single Judge of this Court in the said judgment applies to the facts of this case. We do not propose to take a different view in the matter. The judgment delivered by Full Bench of this Court in Central Warehousing Corporation (supra) relied upon by both the parties also would assist the case of the appellant and not the respondents.
123. In this case, there is no prayer for recovery of possession of the shop in the new building by the appellant as a tenant but is made as an allottee of the shop in the new building on ownership basis without payment of any costs or charges and not for tenancy of the shop in the new building. Section 41 of the Presidency Small Causes Court, 1882 or the Maharashtra Rent Control Act would be thus not attracted in the facts of this case even remotely.
124. Mr. Engineer, learned Counsel for the appellant, rightly invited our attention to various averments made by the appellant 88 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc including in paragraph (n) of the Arbitration Petition contending that the respondent was duty bound to pay to the appellant a sum of Rs. 37, 689.33 per month towards monthly displacement rent and a sum of Rs. 1,00,000/- per month towards delay compensation for default period till handing over of new shop in the new building. He is right that such relief would not fall within the purview of Section 41 of the Presidency Small Causes Court or under any of the provisions of the Bombay Rent Act.
125. A perusal of Section 33 of the Maharashtra Rent Control Act, 1999 clearly indicates that the said provision does not refer to "charges" whereas Section 41 of the Presidency Small Causes Court Act, 1882 refers to "charges". The forum for recovery of charges under Section 33 of Maharashtra Rent Control Act, 1999 and under Section 41 of Presidency Small Causes Court Act,1882 however are the same.
126. Under Section 16 of the Maharashtra Rent Control Act, 1999 and, more particularly, under Section 16 (i) and (k), it is provided as to when the landlord may recover possession. The said provision clearly indicates that the landlord may recover possession if the premises are reasonably and bona fide required by the landlord for the immediate purpose of demolishing them and such demolition is to be made for the purpose of erecting new building on the premises sought to be demolished. The possession 89 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc may be also recovered by the landlord if the premises are required for the immediate purpose of demolition ordered by any municipal authority or other competent authority. The said provision under Section 16 is subject to Section 25 of the Maharashtra Rent Control Act,1999. It is not the case of respondents that the Municipal Corporation or other competent authority had issued any notice for demolition of the said building and pursuant to such notice, the old building and the tenements occupied by the appellant and other tenants were demolished.
127. Admittedly, in this case, respondents had applied for redevelopment permission under Regulation 33 (7) of the Development Control Regulations, 1991 to rehabilitate the existing tenants in the new building on ownership basis by providing permanent alternate accommodation free of cost. Respondents were also entitled to carry out construction of additional tenements. If respondents would have agreed to provide accommodation in the new building by continuing the existing tenancy rights in the new structure constructed in the new building and if the landlord would not have handed over possession of the tenements to the tenants in the new building, the tenants in that event could have filed a suit under Section 17 of the said provisions of the said Maharashtra Rent Control Act, 1999 for recovery of possession against the landlord read with Section 18 of the said Act.
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128. In this case, the appellant sought recovery of possession on ownership basis along with displacement rent and compensation under the said agreement entered into between the parties and not for recovery of possession as a tenant of the new tenement constructed in the new building by respondent No.1. The provisions of Section 16 read with Sections 18 and 19 of the Maharashtra Rent Control Act also thus would not apply in the facts of this case.
129. The Hon'ble Supreme Court in case of Karnani Properties Ltd. (supra) has considered the provisions of West Bengal Premises Rent Control (Temporary Provisions) Act, 1950 and has held that the term "rent" has not been defined in the Act. Hence, it must be taken to have been used in its ordinary dictionary meaning. If, as already indicated, the term "rent" is comprehensive enough to include all payments agreed by the tenant to be paid to his landlord for the use and occupation not only of the building and its appurtenances but also of furnishing, electric installations and other amenities agreed between the parties to be provided by and at the cost of the landlord. There is an irresistible conclusion that all that is included in the term "rent" is within the purview of the Act and the other authorities had the power to control the same.
91 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 :::Trupti /Bipin/Vai/kvm comapl-666-2021.doc 130. This Court enquired with the learned Counsel for
respondents whether it was the case of his client that any landlord can pay rent to the tenant for occupying his premises under the provisions of the Bombay Rent Act, learned Counsel for respondent No.1 had no answer. The word "rent" under the provisions of the Bombay Rent Act has to be paid by the tenant to the landlord and not by the landlord to the tenant. The rent provided under the provisions of the Maharashtra Rent Control Act and the displacement rent provided under the agreement entered into between the parties in lieu of the appellant handing over vacant possession to the landlord for the purpose of constructing the new building and to allot the tenements in the new building as and by way of permanent alternate accommodation on ownership basis without payment of any costs are two different sets of compensation and cannot be mixed up. The displacement rent along with other compensation is payable by the owner to the allottee of the premises in the new building on ownership basis whereas the rent for the purpose of use and occupation of the tenanted premises is required to be paid by the tenant to the landlord for occupying the premises of the landlord.
131. Under Section 7(3) of the Maharashtra Rent Control Act, 1999 defines 'landlord'. A perusal of the said definition clearly indicates that the landlord is the person who is entitled to receive the rent in respect of any premises, if the premises were let to a 92 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc tenant and includes any person not being a tenant who from time to time derives title under a landlord and further includes in respect of his sub-tenant, a tenant who has sub-let his premises. The term 'licensee' is defined under Section 7(5). The licensee is the person who is in the occupation of the premises or part thereof under a subsisting agreement for licence given for a licence fee or charge.
132. The term 'tenant' is defined under Section 7(15). A perusal of the said definition indicates that the person by whom or on whose account rent is payable for any premises and includes such person who is a tenant or who is a deemed tenant or who is a sub- tenant as permitted under a contract or by the permission or consent of the landlord etc. In our view, if owner has agreed to pay the displacement rent in lieu of temporary accommodation till such alternate permanent accommodation is handed over by the landlord to the allottee cannot be considered as a landlord within the meaning of Section 7(3) of the Maharashtra Rent Control Act, 1999. Similarly, the tenant who is receiving such allowance from the landlord in lieu of temporary accommodation till such time the permanent alternate accommodation is made available to him by the landlord on ownership cannot be considered as a tenant within the meaning of Section 7(15) of the Maharashtra Rent Control Act, 1999. Learned counsel for the respondent no.1 could not demonstrate as to how his client was a landlord within the 93 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc meaning of Section 7(3) though was paying displacement compensation or rent to the tenant in lieu of the temporary accommodation till the possession of the permanent alternate accommodation is handed over to the tenant on ownership basis in the new building.
133. This Court in case of Shashikant G. Mehta vs. Soonoo Minoo Khajotia (supra) has adverted to judgment of this Court in case of Hatimbhai Khurshid Hussein Bohari v/s. Chandanmal R. Sakhale and Ors., 2003 B.C.I. 770 in which it was held that the rent is a recompense paid by the tenant to the landlord for the transfer of a right to enjoy premises. The Hon'ble Supreme Court in case of Abdul Kader (supra) has held that the term 'rent' has not been defined under Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 and therefore Court shall have to go by the ordinary dictionary meaning of the term 'rent'. The Hon'ble Supreme Court adverted to its earlier judgment in case of Karnani Properties Ltd. v/s. Augustine (Miss), AIR 1957 SC 309 in which it was held that the term 'rent' is comprehensive enough to include, all payments agreed by the tenant to be paid to his landlord for the use and occupation not only of the building and its appurtenances but also furnishing, electric installations and other amenities agreed between the parties to be provided by and at the cost of the landlord. The principles laid down by the Supreme Court in case of Abdul Kader (supra) and by this Court in case of Shashikant G. 94 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 ::: Trupti /Bipin/Vai/kvm comapl-666-2021.doc Mehta (supra) applies to the facts of this case.
134. On perusal of the definition of the landlord and the tenant referred to aforesaid and considering the facts of this case, this Court cannot accept the submission of the Dr. Chandrachud, learned Counsel for the respondents that under the said agreement entered into between the parties, there was a relationship of landlord and tenant though by the said agreement, the appellant became entitled to an allotment of shop as permanent alternate accommodation on ownership basis without payment of any cost. In our view, the arguments advanced by the learned Counsel for the respondent no.1 are ex-facie contrary to well settled principles of law laid down by various Courts in various judgments referred aforesaid and also the provisions of Maharashtra Rent Control Act, 1999.
135. There is no dispute that the Rent Act is a social welfare legislation. It is surprising that the developer who has exploited the appellants in all respect has courage to urge before this Court that the provisions of Rent Act being a social welfare legislation, and is enacted to protect the interest of tenants, the existing dispute between the parties shall be referred to Small Causes Court, though in the facts of this case, Small Causes Court has no jurisdiction to entertain such dispute.
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136. The learned Single Judge of this Court in the impugned order has held that the dispute between the parties cannot be referred to arbitration mainly on the ground that under Clause
(ix) of the Agreement entered into between the parties, the tenancy would be converted into ownership rights only when the tenant was offered the newly constructed premises by way of permanent alternate accommodation on ownership basis free of cost, by a notice intimating that the tenant must take possession before the expiry of 30 days on the date of receipt of such notice accompanied by a occupation certificate in respect of the newly constructed premises. In our view, the learned Single Judge ought to have considered the entire agreement and not a particular clause in isolation.
137. In our view, the view taken by the learned Single Judge is contrary to the provisions of the Maharashtra Rent Control Act, 1999 and contrary to the principles laid down by the Supreme Court and this Court in catena of judgments referred to aforesaid. The judgments referred to and relied upon by the learned Single Judge in the impugned order are clearly distinguishable in the facts of this case. The learned Single Judge has not decided the arbitration petition filed by the appellant under Section 9 of the Arbitration Act on merits but has refused to grant any relief only on the ground that the relationship between the respondent no.1 and the appellant continued to be that of landlord and tenant.
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138. We therefore pass the following order :-
ORDER
(i) The Order passed by the learned Single Judge on 11 th
December, 2020 is set aside.
(ii) The Commercial Appeal Nos. 669 of 2021, 670 of
2021, 686 of 2021, 705 of 2021, 732 of 2021, 747 of
2021, 755 of 2021, 770 of 2021, 777 of 2021, 779 of
2021 and 764 of 2021 are allowed.
(iii) The Commercial Arbitration Petitions filed by the
appellants are restored to file.
(iv) The learned Single Judge shall decide those petitions
on its own merits and without being influenced by the observations made by the learned Single Judge in the impugned order dated 11th December, 2020 and after following the principles of law laid down in this Judgment expeditiously.
(v) In view of disposal of the Appeals, the Interim Applications filed by the Appellants do not survive and are accordingly disposed of.
(vi) There shall be no order as to costs. (V. G. BISHT, J.) (R. D. DHANUKA, J.) 97 ::: Uploaded on - 20/04/2021 ::: Downloaded on - 07/09/2021 19:09:00 :::