Allowed

Smt Yashoda Venkatesh v. M/S Globe Detective Agency (P) Ltd.

Karnataka HC20 Apr 2022WP/20052/2019

Case brief

AI extract

What is this about?

The High Court of Karnataka allowed a writ petition filed by a defendant challenging an order dismissing an application to refer a landlord-tenant dispute to arbitration. Relying on Vidya Drolia, the Court quashed the impugned order and remanded the matter to the trial court to adjudicate the jurisdictional plea.

What did the court decide?

The order dated 16th March 2019 was set aside, the writ petition was allowed, and the matter was remanded to the trial court to hear the arbitration plea within three months.

Smt Yashoda Venkatesh Vs M/S Globe Detective Agency (P) Ltd. — Arbitration | Karnataka HC (2022)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 20^TH DAY OF APRIL, 2022

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BEFORE

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THE HON’BLE MR. JUSTICE E.S. INDIRESH

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WRIT PETITION NO.20052 OF 2019 (GM-CPC)

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BETWEEN

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SMT. YASHODA VENKATESH W/O SRI VENKATESH AGED ABOUT 35 YEARS RESIDING AT NO.104, KRS ROAD, METAGALLI INDUSTRIAL AREA MYSURU-570016.

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PRESENTLY R/AT NO.2-50 (B) KANDADY HOUSE KADABETTU POST AND VILLAGE BANTWALA TALUK MANGALURU DISTRICT-574 265.

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...PETITIONER

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(BY SRI M R VIJAYA KUMAR, ADVOCATE)

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AND

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M/S. GLOBE DETECTIVE AGENCY (P) LTD NO.601-603, EROS APARTMENTS NO.5, NEHRU PLACE NEW DELHI-110019 ALSO AT 102-103 MONEY CENTRE, 121 7^TH BLOCK, KORAMANGALA BENGALURU -560 095

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REPD. BY ITS DIRECTOR MR. PUNEET KUMAR

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SRI HITENDRA RAO PROPRIETOR M/S. VASTRA LAUNDRY

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THIMMEGOWDA MANAGER BIG BASKET

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SRI RAMESH M/S. VISHWAKARMA ENTERPRISES

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SRI SABASTIAN M DAS PROPRIETOR APEX

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THE MANAGER KARNATAKA MILK FEDERATION

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ALL ARE HAVING THEIR OFFICES AT NO.104 (KODAGU FOODS) KRS ROAD METAGALLI INDUSTRIAL AREA MYSURU-570 016.

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….RESPONDENTS (BY SRI M S VARADARAJAN, ADVOCATE FOR R1; NOTICE TO R2, 4 AND 6 ARE SERVED BUT UNREPRESENTED) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER DATED 16^TH MARCH, 2019 PASSED IN IA NO.2 FILED BY THE PETITIONER UNDER SECTION 8 OF THE ARBITRATION AND CONCILIATION ACT 1996 READ WITH SEC. 151 OF CODE OF CIVIL PROCEDURE BY REFERRING THE MATTER TO ARBITRATION IN THE FILE OF ORIGINAL SUIT NO. 4 OF 2017

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PENDING BEFORE THE III ADDITIONAL SENIOR CIVIL JUDGE AND JMFC AT MYSURU, VIDE ANNEXURE- F

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THIS PETITION COMING ON FOR PRELIMINARY HEARING THIS DAY, THE COURT MADE THE FOLLOWING:

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O R D E R

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This Writ Petition is filed by defendant No.1 in Original Suit No.4 of 2017 on the file of the III Additional Senior Civil Judge and CJM, Mysuru questioning the order dated 16^th March, 2019, dismissing the IA.2 filed by defendant No.1.

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The relevant facts for adjudication of this writ petition are that, the plaintiff has filed suit against the defendant seeking relief of vacating and handing over the suit schedule property with payment of arrears of rent. The said suit is contested by the defendants. The defendants raised preliminary objection by filing IA.2 under Section 8 of the Arbitration and Conciliation Act, 1996 (for short, hereinafter referred to as ‘Act’), referring clause 8.11 and 8.13 of Leave and Licence Agreement dated 14^th March, 2014 regarding the jurisdiction inter alia arbitration clause in the said agreement. The said application was contested by the plaintiff. The trial Court, after considering the

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material on record, by impugned order dated 16^th March 2019 dismissed IA.2 and being aggrieved by the same, the defendant No.1 has presented this Writ Petition.

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I have heard Sri M.R. Vijaya Kumar, learned counsel appearing for the petitioner and Sri M.S. Varadarajan, learned counsel appearing for respondent No.1.

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Sri M.R. Vijaya Kumar, learned counsel appearing for the petitioner submitted that the impugned order passed by the trial Court requires reconsideration, as the trial Court has no jurisdiction to entertain the suit and in view of the existence of the arbitration clause in the Leave and Licence agreement dated 14^th March 2014, the suit is not maintainable before the trial Court and as such, he argued for setting aside the impugned order passed by the trial Court.

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Per contra, Sri Varadarajan M.S., learned counsel appearing for the respondent No.1 submitted that the plaintiff is the owner of the property in question and the defendant No.1, being a lessee, has not paid the rents for considerable period and therefore, he contended that the arrears of rent is in an

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extent of Rs.35,93,000/- and also damages has to be paid by the defendant to the plaintiff and therefore, he contended that the arguments advanced by the learned counsel appearing for the petitioner taking plea of jurisdiction and the arbitral clause, is only to protract the proceedings before the trial Court and therefore sought for dismissal of the Writ Petition.

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In the light of the submission made by the learned counsel appearing for the parties, I have carefully considered the recitals in the Leave and Licence Agreement dated 14^th March, 2014 and 01^st August, 2014. It is not in dispute that the suit is filed by the plaintiff seeking vacation of the premises by the defendant. Clause 8.13 of the aforementioned agreement provides for arbitration clause. At this juncture, it is relevant to refer to the three Judge Bench judgment of the Hon'ble Apex Court in the case of VIDYA DROLIA v. DURGA TRADING CORPORTION reported in (2021)2 SCC 1, wherein at paragraphs 79 and 80 of the judgment, the Hon'ble Apex Court observed thus:

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“ 79. Landlord-tenant disputes governed by the Transfer of Property Act are arbitrable as they are not action sin tem but pertain to subordinate rights in personam that arise from rights in tem. Such actions normally would not affect third-party rights or have erga omnes effect or require centralised adjudication. An award passed deciding landlord-tenant disputes can be executed and to inalienable and sovereign functions of the State. The provisions of the Transfer of Property Act do not expressly or by necessary implication bar arbitration. The Transfer of Property Act, like all other Acts, has a public purpose, that is, to regulate landlordtenant relationships and the Arbitrator would be bound by the provisions, including provisions which enure and protect the tenants.

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80. In view of the aforesaid, we overrule the ratio laid down in HIMANGI ENTERPRISES and old that the landlord-tenant disputes are arbitrable as the Transfer of Property Act does not forbid or foreclose arbitration. However, landlord-tenant disputes covered and government by rent control legislation would not be arbitrable when specific court or forum has been given exclusive jurisdiction to apply and decide special right and obligations. Such rights are obligations can only be adjudicated and enforced by the specified court/forum, and not through arbitration. ”

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In that view of the matter, I am of the view that the impugned order is liable to be set aside, and the matter to be remanded to the trial Court for passing orders afresh. Accordingly, Order dated 16^th March 2019 passed on IA.2 in Original Suit No.4 of 2017 by the III Additional Senior Civil Judge and CJM, Mysuru is set aside. Resultantly, Writ petition is allowed and the matter is remanded to the trial Court to consider the plea of objection raised by the defendants relating to the jurisdictional aspects and arrears of rents if any, as contended by the respondents and pass appropriate orders in accordance with law within an outer of three months from the date of receipt of certified copy of this order. It is also made clear that this Court has not expressed any opinion on the merits of the case and the trial Court is directed to decide the application independently, as narrated above.

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Sd/JUDGE

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lnn

Smt Yashoda Venkatesh v. M/S Globe Detective Agency (P) Ltd.

Case brief

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Smt Yashoda Venkatesh v. M/S Globe Detective Agency (P) Ltd.

Case brief

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