RAVINDRA s/o VITTHALRAO SONGIRE v. LABHSHETWAR AND SAKKARWAR CONSTRUCTIONS
2009-10-08
R.M.BORDE
body2009
DigiLaw.ai
JUDGMENT : This is an application by applicant seeking appointment of Arbitrator under section 11 of the Arbitration and Conciliation Act, 1996. 2. Petitioner claims to be lessee in respect of leasehold premises belonging to the respondents. Petitioner contends that the lease is in respect of the constructed property having basement, ground floor, second floor and terrace constructed on plot No. 4 situate at Vedant Nagar, Aurangabad. It is the contention of the applicant that the parties initially executed agreement titled as Leave and License, however, according to the terms and conditions of the said agreement, the document shall have to be construed as lease agreement. It is contended that after expiry of the period prescribed under the first agreement, fresh agreement came to be executed on 19-1-2007 which is also titled as Leave and License for a period until 18-7-2009. However, according to the applicant, although the document is styled as Leave and License agreement, proper construction of the terms contained in the document make it clear that it is lease deed executed by respondents in favour of the petitioner. According to petitioner, there arose certain dispute/differences between the parties which necessitates appointment of Arbitrator. The document executed between the parties contain a clause in respect of appointment of Arbitrator for resolving the disputes arising between the parties. It is contended by the petitioner that agreement arrived at between the parties which is reduced into writing contain clause No. 21 which makes it mandatory to make reference to the Arbitrator for resolving the dispute. It is contended that there exists disputes which are required to be resolved by making appointment of the Arbitrator. Thus, according to the petitioner, there exists live claim which is required to be settled through mechanism of the Arbitrator. 3. Contentions raised by the petitioners have been opposed by the respondents mainly on two grounds. It is contended that clause 21 contained in the agreement cannot be construed as arbitration agreement within meaning of section 7 of the Arbitration and Conciliation Act, 1996. According to the respondents, the agreement necessarily or mandatorily does not require appointment of Arbitrator. As such, application seeking appointment of Arbitrator is not maintainable.
It is contended that clause 21 contained in the agreement cannot be construed as arbitration agreement within meaning of section 7 of the Arbitration and Conciliation Act, 1996. According to the respondents, the agreement necessarily or mandatorily does not require appointment of Arbitrator. As such, application seeking appointment of Arbitrator is not maintainable. Second argument advanced by the respondents is that as the petitioner himself has pleaded about the relationship between the parties as lessor and lessee and as the petitioner himself has contended that the agreement in question is essentially a lease agreement, by virtue of provisions of section 33 of the Maharashtra Rent Control Act, the questions/disputes raised by the applicant fall within exclusive domain of the forum created under the provisions of said enactment. It is contended that section 33 of the Maharashtra Rent Control Act excludes the jurisdiction to entertain any suit, proceeding or application which deals with, claims or questions relating to recovery of rent or possession arising between the landlord and tenant. Determination of the question between the landlord and tenant relating to recovery of rent or possession falls within the exclusive jurisdiction of the Civil Court in view of provisions of section 33(1)(c) of the Maharashtra Rent Control Act. According to learned counsel for the respondents, therefore, reference to Arbitrator for determination of the questions/disputes is impermissible. 4. In order to appreciate the objections raised by the respondents, it is necessary to refer to clause 21 contained in the agreement which, according to the petitioner makes it obligatory to refer the dispute to Arbitrator: 21. It is understood and by the parties to the agreement that for all disputes "Aurangabad only" will be the jurisdiction and in such event both the parties shall try to resolve the problem by negotiations and shall recourse to arbitration proceedings before approaching the Court of law and appointment of the arbitrator shall by mutual consent of parties in writing. Section 33 of the Maharashtra Rent Control Act reads thus: 33. Jurisdiction of Courts. - 1.
Section 33 of the Maharashtra Rent Control Act reads thus: 33. Jurisdiction of Courts. - 1. Notwithstanding anything contained in, any law for the time being in force, but subject to the provisions of Chapter VIII, and notwithstanding that by reason of the amount of the claim or for any other reason, the suit or proceeding would not, but for this provision, be within its jurisdiction, a. in Brihan Mumbai, the Court of Small Causes, Mumbai, b. in any area for which a Court of Small Causes is established under the Provincial Small Causes Courts Act, 1887, such Court, and c. elsewhere, the Court of the Civil Judge (Junior Division) having jurisdiction in the area in which the premises are situate or, if there is no such Civil Judge, the Court of the Civil Judge (Senior Division) having ordinary jurisdiction, shall have jurisdiction to entertain or try any suit or proceeding between a landlord and a tenant relating to the recovery of rent or possession of any premises and to decide any application made under this Act (other than the applications which are to be decided by the State Government or an officer authorized by it or the Competent Authority); and subject to the provisions of sub-section (2), no other Court shall have jurisdiction to entertain any such suit, proceeding, or application or to deal with such claim or question. It is contended by respondents that clause 21 cannot be construed as an arbitration agreement mandatorily requiring reference of dispute to the Arbitrator. Section 7 of the Arbitration and Conciliation Act, 1996 defines arbitration agreement thus: 7. Arbitration agreement :1. In this Part, "arbitration agreement" means an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not. 2. An arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement. 3. An arbitration agreement shall be in writing. 4. An arbitration agreement is in writing if it is contained ina. a document signed by the parties.
2. An arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement. 3. An arbitration agreement shall be in writing. 4. An arbitration agreement is in writing if it is contained ina. a document signed by the parties. b. an exchange of letters, telex, telegrams or other means of telecommunication which provide a record of the agreement; or c. an exchange of statements of claim and defence in which the existence of the agreement is alleged by one party and not denied by the other. 5. The reference in a contract to a document containing an arbitration clause constitutes an arbitration agreement if the contract is in writing and the reference is such as to make that arbitration clause part of the contract. According to respondents the question as regards "existence" of the arbitration agreement is required to be decided by the Court and not necessarily by the arbitrator alone. In view of the provisions of section 33 of the Arbitration Act, 1940, the question was required to be decided only by the Court and not by the arbitrator. However, section 16 of the Arbitration and Conciliation Act, 1996 confers powers on the arbitral tribunal to decide whether there exists arbitration clause. However, the language employed by section 16 of the new act is only enabling one and permits the arbitral tribunal also to decide the question relating to existence of arbitration clause. Section 16 of the Act, however, does not take away the jurisdiction of the Chief Justice of India or his designate to decide the question of existence of arbitration clause. Thus, it is contended that the question as regards existence of the arbitration agreement which necessitates reference to arbitral tribunal is required to be determined by this Court while dealing with the instant application. Reliance is placed on judgment of the Apex Court in the matter of Jagdish Chander vs. Ramesh Chander and others, reported in (2007) 5 SCC 719 . In paragraph No.8 of the judgment, Apex Court has observed thus: 8. This Court had occasion to refer to the attributes or essential elements of an arbitration agreement in K.K. Modi vs. K.N. Modi, Bharat Bhushan Bansal vs. U.P. Small Industries Corpn.
In paragraph No.8 of the judgment, Apex Court has observed thus: 8. This Court had occasion to refer to the attributes or essential elements of an arbitration agreement in K.K. Modi vs. K.N. Modi, Bharat Bhushan Bansal vs. U.P. Small Industries Corpn. Ltd, and Bihar State Mineral Development Corpn, vs. Encon Builders (I) (P) Ltd., In State of Orissa vs. Damodar Das this Court held that a clause in a contract can be construed as an "arbitration agreement" only if an agreement to refer disputes or differences to arbitration is expressly or impliedly spelt out from the clause. We may at this juncture set out the well-settled principles in regard to what constitutes an arbitration agreement: i The intention of the parties to enter into an arbitration agreement shall have to be gathered from the terms of the agreement. If the terms of the agreement clearly indicate an intention on the part of the parties to the agreement to refer their disputes to a private tribunal for adjudication and a willingness to be bound by the decision of such tribunal on such disputes, it is arbitration agreement. While there is no specific form of an arbitration agreement, the words used should disclose a determination and obligation to go to arbitration and not merely contemplate the possibility of going for arbitration. Where there is merely a possibility of the parties agreeing to arbitration in future, as contrasted from an obligation to refer disputes to arbitration, there is no valid and binding arbitration agreement. ii Even if the words "arbitration" and "Arbitral Tribunal (or arbitrator)" are not used with reference to the process of' settlement or with reference to the private tribunal which has to adjudicate upon the disputes, in a clause relating to settlement of disputes, it does not detract from the clause being an arbitration agreement if it has the attributes or elements of an arbitration agreement. They are: (a) the agreement should be in writing. (b) The parties should have agreed to refer any disputes (present or future) between them to the decision of a private tribunal. (c) The private tribunal should be empowered to adjudicate upon the disputes in an impartial manner, giving due opportunity to the parties to put forth their case before it. (d) The parties should have agreed that the decision of the private tribunal in respect of the disputes will be binding on them.
(c) The private tribunal should be empowered to adjudicate upon the disputes in an impartial manner, giving due opportunity to the parties to put forth their case before it. (d) The parties should have agreed that the decision of the private tribunal in respect of the disputes will be binding on them. iii Where the clause provides that in the event of disputes arising between the parties, the disputes shall be referred to arbitration, it is an arbitration agreement. Where there is a specific and direct expression of intent to have the disputes settled by arbitration, it is not necessary to set out the attributes of an arbitration agreement to make it an arbitration agreement. But where the clause relating to settlement of disputes, contains words which specifically exclude any of the attributes of an arbitration agreement or contains anything that detracts from an arbitration agreement, it will not be an arbitration agreement. For example, where an agreement requires or permits an authority to decide a claim or dispute without hearing, or requires the authority to act in the interests of only one of the parties, or provides that the decision of the authority will not be final and binding on the parties, or that if either party is not satisfied with the decision of the authority, he may file a civil suit seeking relief, it cannot be termed as an arbitration agreement. iv But merely use of the word 'arbitration' or 'arbitrator' in a clause will not make it an arbitration agreement, if it requires or contemplates a further or fresh consent of the parties for reference to arbitration. For example, use of words such as 'parties can, if they so desire, refer their disputes to arbitration' or 'in the event of any dispute, the parties may also agree to refer the same to arbitration' or 'if any disputes arise between the parties, they should consider settlement by arbitration' in a clause relating to settlement of disputes, indicate that the clause which states that 'if the parties so decide, the disputes shall be referred to arbitration' or 'any disputes between parties, if they so agree, shall be referred to arbitration' is not an arbitration agreement. Such clauses merely indicate a desire or hope to have the disputes settled by arbitration, or a tentative arrangement to explore arbitration as a mode of settlement if and when a dispute arises.
Such clauses merely indicate a desire or hope to have the disputes settled by arbitration, or a tentative arrangement to explore arbitration as a mode of settlement if and when a dispute arises. Such clauses require the parties to arrive at a further agreement to go to arbitration, as and when the disputes arise. Any agreement or clause in an agreement requiring or contemplating a further consent or consensus before a reference to arbitration, is not an arbitration agreement, but an agreement to enter into an arbitration agreement in future. According to learned counsel for the respondents, clause 21 contained in the agreement is merely an enabling provision which merely contemplates possibility of going to arbitration. According to him, said clause does not disclose determination and obligation to go to arbitration. There is merely possibility of the parties agreeing for arbitration in future and there is no obligation to refer the dispute to the arbitrator. Thus, there is no valid and binding arbitration agreement. Clause 21 provides that for all the disputes Aurangabad only will be the jurisdiction meaning thereby that the proceedings for settlement of dispute shall have to be initiated in the Court within the jurisdiction of Aurangabad. It further provides that both the parties shall try to resolve the dispute by negotiation which is the second mode of settlement of dispute provided under clause 21 and the third mode prescribed is in respect of reference to arbitration and that too before approaching the Court of law. Thus, bare reading of clause 21 would give an impression that firstly the dispute, if any, shall have to be presented with the forum having powers to settle the dispute within the jurisdiction of Aurangabad city, the second mode prescribed for settlement of dispute is by way of negotiation, the third mode prescribed is by having recourse to arbitration proceedings and the same shall be before approaching the Court of law, thus, meaning thereby approach to Court of law is the fourth mode prescribed for settlement of dispute. Thus, clause 21 does not spell out the mandate for making reference to arbitration for settling the dispute arising between the parties. Thus, considering the test laid down by the Apex Court in the judgment cited supra, the agreement in question in the instant matter provides merely a possibility of the parties agreeing to refer the matter to the arbitration.
Thus, clause 21 does not spell out the mandate for making reference to arbitration for settling the dispute arising between the parties. Thus, considering the test laid down by the Apex Court in the judgment cited supra, the agreement in question in the instant matter provides merely a possibility of the parties agreeing to refer the matter to the arbitration. Clause 21 of the agreement does not mandatorily require the parties to make reference of dispute to the arbitrator alone. In these circumstances, clause 21 contained in the agreement cannot be construed as arbitration agreement within meaning of section 7 of the Act mandatorily requiring reference of dispute to the arbitrator. Thus, existence of arbitration clause is sine qua non for reference of dispute to the arbitrator. In the instant matter, arbitration clause is uncertain and as such incapable to conclude that the parties are at ad idem for referring their dispute to the arbitrator. Thus, reference to arbitrator is uncalled for. 5. The second limb of argument advanced by the respondent is that the question raised by the applicant or reference of dispute sought to the arbitrator falls essentially within the exclusive domain of the judicial forum created under the provisions of Maharashtra Rent Control Act for settlement of dispute. It is contended that the dispute relating to which reference is sought is relating to recovery of possession of premises and the petitioner himself has claimed relationship of tenant and landlord subsisting between the parties. Thus, the question or dispute falls within the exclusive domain of the judicial forum created under the Maharashtra Rent Control Act and as such, reference to arbitrator for adjudication of the dispute is impermissible. Petitioner himself in the application contends that the agreement arrived at between the parties on 191-2007 although is styled as Leave and License agreement, the same is essentially lease agreement. In paragraph No.1 of the application, it is contended that the petitioner is lessee of constructed property belonging to the respondents. In order to determine which Court has jurisdiction to try the suit, it is obligatory for the Court to read the plaint or application as a whole and ascertain the real nature of the suit or proceeding.
In paragraph No.1 of the application, it is contended that the petitioner is lessee of constructed property belonging to the respondents. In order to determine which Court has jurisdiction to try the suit, it is obligatory for the Court to read the plaint or application as a whole and ascertain the real nature of the suit or proceeding. Whatever may be the form of relief claimed, if on fair reading of the plaint or application it becomes apparent that the petitioner has alleged relationship of landlord and tenant between him and the respondents, the relief claimed in the proceeding relating to recovery of rent or possession then it is the special Court alone that will have jurisdiction to decide the dispute. Thus, the pleadings raised in the application will have to be taken into account for considering the questions raised by the applicant. The petitioner in. the instant petition has claimed existence of relationship of tenant and landlord between him and the respondents. Thus, applicability of provisions of Maharashtra Rent Control Act cannot be ruled out. Section 33 of the Act excludes the jurisdiction of any other forum or entertainment of any suit, proceeding or application dealing with the claim or question relating to recovery of rent or possession falling between the landlord and tenant. It is argued by learned counsel for the respondents that the dispute arising between the parties is essentially relating to recovery of possession. The petitioner himself has pleaded in the application about existence of relationship of landlord and tenant between the parties. Thus, according to learned counsel for the respondents, reference to arbitration is barred and the clause contained in the agreement i.e. clause 21 even if construed as an arbitration agreement shall have to be declared as non est. Reliance is placed on Full Bench judgment in the matter of Dattatraya Krishna Jangam vs. Jairam Ganesh Gore, reported in 1964 Mh.L.J. (FB) 750 = 1965 BCI (0) 11. Question raised in the matter was as to whether the jurisdiction of the Special Court depends on the plaintiffs case as made out in the plaint or whether the contentions raised by the defendants are also required to be taken into consideration.
Question raised in the matter was as to whether the jurisdiction of the Special Court depends on the plaintiffs case as made out in the plaint or whether the contentions raised by the defendants are also required to be taken into consideration. It is ruled by the Court that the jurisdiction of the Court should ordinarily be determined at the time of institution of the suit when the plaint is filed, that the plea of the defendant will not determine or change the forum and that in order to decide whether a suit comes within the purview of section 28 what must be considered is what the suit as formed in substance is and what the relief claimed therein is. In a case reported in 1964 Mh.L.J. (SC) 410 = 66 BLR 205, it was held that under section 28 of the Maharashtra Rent Control Act, the exclusive jurisdiction of the Court has to be inferred only if the person invoking the jurisdiction of the Court alleges that the other party is a tenant or landlord and the question is one which is referred to under section 28 of the Act. Whether the person so invoking does not set up the claim that the other party is tenant or landlord, defendant is not entitled to displace the jurisdiction of the ordinary Court by an allegation that he stands in that relation and on that ground the Court has no jurisdiction to try the suit or proceeding or an application. It is also observed by the Court that the term appearing in section 28 of the Bombay Rent Act "relating to recovery of rent or possession" is wide and would include any suit or proceeding in connection with or having direct bearing on the question of possession of the premises. Section 33 of the Maharashtra Rent Control Act also refers to proceeding between the landlord and tenant "relating to recovery of rent or possession". The Special Court is invested with powers not only to decide the question referred to in the section but also of matters which are incidental or ancillary for determination of these questions. Reliance is placed on judgment of the Apex Court in the matter of Natraj Studio (P) Ltd. vs. Navrang Studios and another reported in (1981) 1 SCC 523 .
Reliance is placed on judgment of the Apex Court in the matter of Natraj Studio (P) Ltd. vs. Navrang Studios and another reported in (1981) 1 SCC 523 . Dispute before the Apex Court between the parties was relating to possession of the premises and the relationship between the parties claimed was that of licensor or landlord and licensee/tenant. In the facts appearing in the matter, it was held that the Court of small causes alone shall have jurisdiction to deal with the dispute and the arbitrator has none to adjudicate upon the dispute between the parties. The question arising in the matter was in respect of construction of the provisions of Bombay. Rents, Hotel and Lodging House Control Act, 1947 and the Apex Court found that the provisions of Bombay Rent Act 1947 have applicability considering the nature of the dispute. Section 28 of the Act is pari materia with section 33 of the Maharashtra Rent Control Act. Under the Bombay Rent Control Act, exclusive jurisdiction to deal with the issues is invested with the Court of Small Causes in Greater Bombay. Section 28 of the Act provides that no other Court shall have jurisdiction to entertain such suit or proceeding or application or to deal with such claim or question. Relying on the provisions of section 28 of the Act it was canvassed before the Apex Court that the jurisdictional questions fall to be decided before the Court of exclusive jurisdiction and as such adjudication by any other forum is not permissible including reference to arbitration. While dealing with the issue, the Apex Court has observed in paragraph No. 18 of the judgment thus: 18. Thus exclusive jurisdiction is given to the Court of Small Causes and jurisdiction is denied to other Courts (1) to entertain and try any suit or proceeding between a landlord and a tenant relating to recovery of rent or possession of any premises, (2) to try any suit or proceeding between a licensor and a licensee relating to the recovery of licence fee or charge, (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.
Exclusive jurisdiction to entertain any try certain suits, to decide certain applications or to deal with certain claims or questions does not necessarily mean exclusive jurisdiction to decide jurisdictional facts also. Jurisdictional facts have necessarily to be decided by the Court where the jurisdictional question falls to be decided, and the question may fall for decision before the Court of exclusive jurisdiction or before the Court of ordinary jurisdiction. A person claiming to be a landlord may sue his alleged tenant for possession of a building on grounds specified in the Rent Act. Such a suit will have to be brought in the Court of Small Causes, which has been made the Court of exclusive jurisdiction. In such a suit, the defendant may deny the tenancy but the denial by the defendant will not oust the jurisdiction of Court of Small Causes. If ultimately the Court finds that the defendant is not a tenant the suit will fail for that reason. If the suit is instituted in the ordinary Civil Court instead of the Court of Small Causes the plaint will have to be returned irrespective of the plea of the defendant. Conversely a person claiming to be the owner of a building and alleging the defendant to be a trespasser will have to institute the suit, on the plaint allegations, in the ordinary Civil Court only. In such a suit the defendant may raise the plea that he is a tenant and not a trespasser. The defendant's plea will not straightaway oust the jurisdiction of the ordinary Civil Court but if ultimately the plea of the defendant is accepted the suit must fail on that ground. So the question whether there is relationship of landlord and tenant between the parties or such other jurisdictional questions may have to be determined by the Court where it falls for determination - be it the Court of Small Causes or the ordinary Civil Court. If the jurisdictional question is decided in favour of the Court of exclusive jurisdiction the suit or proceeding before the ordinary Civil Court must cease to the extent its jurisdiction is ousted. It has also been ruled by the Apex Court that section 28 of the Act excludes reference to arbitration of a dispute relating to recovery of rent or possession of the premises. It is observed in paragraph Nos. 23 and 24 of the judgment thus: 23.
It has also been ruled by the Apex Court that section 28 of the Act excludes reference to arbitration of a dispute relating to recovery of rent or possession of the premises. It is observed in paragraph Nos. 23 and 24 of the judgment thus: 23. In Sabavva Kom Hanmappa Simpiger vs. Basappa Andaneppa Chiniwar, the question directly arose, as in the present case, whether section 28 of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, excluded reference to arbitration of a dispute relating to recovery of rent or possession of premises. It was held by a Division Bench of the Bombay High Court that the expression Court occurring in section 28 of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 included an arbitrator and therefore, the jurisdiction of the Arbitrator to make an award in respect of any dispute of the nature mentioned in section 28 was excluded. 24. In the light of the foregoing discussion and the authority of the precedents, we hold that both by reason of section 28 of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 and by reason of the broader considerations of public policy mentioned by us earlier and also in Deccan Merchants Cooperative Bank Ltd. vs. M/s Dalichand Jugraj Jain, the Court of Small Causes has and the arbitrator has not the jurisdiction to decide the question whether the respondent-licensor landlord is entitled to seek possession of the two Studios and other premises together with machinery and equipment from the appellant licensee-tenant. That this is the real dispute between the parties is abundantly clear from the petition filed by the respondents in the High Court of Bombay, under section 8 of the Arbitration Act seeking a reference to Arbitration. The petition refers to the notices exchanged by the parties, the respondent calling upon the appellant to hand over possession of the Studios to him and the appellant claiming to be a tenant or protected licensee in respect of the Studios. The relationship between the parties being that of licensor-landlord and licensee-tenant and the dispute between them relating to the possession of the licensed-demised premises, there is no help from the conclusion that the Court of Small Causes alone has the jurisdiction and the Arbitrator has none to adjudicate upon the dispute between the parties.
The relationship between the parties being that of licensor-landlord and licensee-tenant and the dispute between them relating to the possession of the licensed-demised premises, there is no help from the conclusion that the Court of Small Causes alone has the jurisdiction and the Arbitrator has none to adjudicate upon the dispute between the parties. Language employed in section 33 of the Maharashtra Rent Control Act is essentially the same as section 28 of the Bombay Rent Control Act. Section 33 opens with non obstante clause and further provides that notwithstanding that by reason of the amount of the claim or for any other reason, the suit or proceeding would not, but for this provision, be within its jurisdiction so far as clause 'c' is concerned which has applicability to the instant case. The Court of Civil Judge, Junior Division having jurisdiction in the area in which the premises are situate shall have jurisdiction to entertain and try any suit or proceeding between the landlord and tenant relating to "recovery of rent or possession of any premises" and to decide any application made under the Act. It has also been provided that no other Court shall have jurisdiction to entertain such suit, proceeding or application or to deal with such claim or question. Considering the provisions of section 33 of Maharashtra Rent Control Act, the ratio laid down by the Apex Court in Natraj Studio case (cited supra) would apply to the facts of the instant case and in view of vesting of exclusive jurisdiction with the Civil Court in view of provisions of section 33 of the Maharashtra Rent Control Act, reference to arbitrator would not be permissible. Similar view has been taken in the matter of Carona Ltd. vs. Sumangal Holding, reported in 2007(4) Mh.L.J. 551 = 2007(4) Bom.C.R. 265 . The view adopted by the Single Judge while dealing with the application under section 9 of the Arbitration and Conciliation Act 1996 has been confirmed by the Division Bench of the High Court. The observations made by the learned Single Judge in the judgment have been quoted by the Division Bench. Those are as below: "In my opinion, however, mere deletion of non-obstante clause from section 41 will not make much difference.
The observations made by the learned Single Judge in the judgment have been quoted by the Division Bench. Those are as below: "In my opinion, however, mere deletion of non-obstante clause from section 41 will not make much difference. Because of the non-obstante clause contained in section 41, the jurisdiction of the Civil Court to entertain the suit between the licensee and licensor for recovery of possession and for recovery of licence fee was expressly barred. But perusal of the provisions of section 9 of the Civil Procedure Code shows that the jurisdiction of the Civil Court to entertain the suit can be expressed barred and it also can be barred by necessary implication. It can now be taken as a settled law that when the legislature creates special forum for adjudication of disputes of a particular nature then by necessary implication, jurisdiction of the Court of Original Civil Jurisdiction to entertain those disputes is barred by necessary implication. The legislature by enacting section 41 created a special forum for adjudication of disputes between the licensor and licensee in relation to recovery of licence fee and recovery of possession. Section 41 also created forum for filing an appeal against the decision of Small Causes Court. Thus, as the legislature has created a special forum for adjudication of disputes between the licensee and licensor in relation to recovery of possession and licence fee, the jurisdiction of the Court of Original Civil Jurisdiction will be ousted by necessary implication and, therefore, applying the law laid down by the Supreme Court in Natraj Studios the reference to arbitration of the question which falls for decision before the Small Causes Court suit under section 41, cannot be possible." Reference also can be made to judgment in the matter of ING Vysya Bank Limited VS. Modern India Limited and another reported in 2008(2) Mh.L.J. 653 = 2008(2) Bom.C.R. 255 . The issue before the Court was as to whether the provisions of section 43 of the Presidency Small Cause Courts Act, 1882 would bar jurisdiction of the arbitral tribunal to entertain the claim for specific performance of an agreement of renewal of condition in an agreement of licence executed between the licensor and licensee. While holding in favour of exclusion of jurisdiction of arbitral tribunal the Court has placed reliance on the judgment of the Apex Court in the matter of Natra) Studio (cited supra).
While holding in favour of exclusion of jurisdiction of arbitral tribunal the Court has placed reliance on the judgment of the Apex Court in the matter of Natra) Studio (cited supra). In paragraph No. 11 of the judgment it is observed thus: 11. The Supreme Court reaffirmed the principle that the jurisdiction of the Small Causes Courts was exclusive and it was only that Court which could entertain suits of the description falling in section 41 (1) which was pari materia with section 28 of the Rent Act of 1947. The Court upheld the correctness of the view taken in the judgment of the Full Bench of this Court in Dattatraya Krishna Jangam Vs. Jairam Ganesh Gore, 1964 Mh.L.J. (FB) 750 = 1965 BCI 11 = AIR 1965 Bom 177 that a suit for injunction against a landlord for restraining him from forcibly evicting the tenant from possession of the premises would lie within the exclusive jurisdiction of the Small Causes Court. The Supreme Court held that once the plaintiff contends that he is a licensee of the suit premises and the defendant is a licensor and he seeks the assistance of the Court on that basis to protect his possession, it would be a suit between a licensee and licensor relating to the recovery of possession. In a given case, the Supreme Court noted an injunction suit purely based on previous peaceful possession and a subsequent threatened dispossession may stand on an entirely different footing and may not attract the sweep of section 41 (1), but the suits before the Supreme Court in that case were based on the allegation that the plaintiffs were licensees on monetary considerations who apprehended dispossession not in accordance with law at the hands of the licensors. Such a suit would attract the provisions of section 41 (1) by satisfying both the requirements viz. of being a suit between a licensor and a licensee and relating to the recovery of possession of immovable property. The Division Bench has adopted the interpretation of the phrase "suit relating to recovery of rent or possession" as recorded in the judgment of Mansukhlal Dhanraj Jain Vs. Eknath Vithal Ogale, reported in 1995(3) BCR 240 = AIR 1995 SC 1102 .
The Division Bench has adopted the interpretation of the phrase "suit relating to recovery of rent or possession" as recorded in the judgment of Mansukhlal Dhanraj Jain Vs. Eknath Vithal Ogale, reported in 1995(3) BCR 240 = AIR 1995 SC 1102 . It is also observed by the Division Bench relying on the judgment of the Apex Court that the words "relating to" are of wide import and can take in their sweep any suit in which the grievance is made that the defendant is threatening to illegally recover possession from the plaintiff-licensee. In the matter before the Division Bench, there existed relationship of licensor and licensee between the parties and contention of the petitioner is relatable to the existence of that relationship. The suit relating to recovery of possession is a concept which is much wider in its ambit than the suit for possession. Claim raised in application under section 9 of the Arbitration Act therefore fall within the sweep of the term "relating recovery of possession". It is observed in paragraph No. 19 of the judgment thus: 19. The relief that has been sought in the arbitration petition under section 9 is indicative in some measure of the nature and character of the dispute between the parties. The respondents dispute that the petitioner exercised the option of renewal as provided in the agreement. The relief which the petitioner claims in the application under section 9 is an injunction restraining the respondents from terminating the agreement; from acting in pursuance of a letter demanding possession and from adopting proceedings for securing the eviction of the petitioner or the recovery of the possession of the licensed premises. The petitioner seeks an injunction restraining the respondents from obstructing its "uninterrupted, unbroken, quiet and peaceful use, occupation and enjoyment of the licensed premises", from selling, transferring or alienating the licensed premises; obstructing or preventing the delivery of service envisaged in the agreement; obstructing supply of utilities such as electricity and water and other consequential reliefs. There can be absolutely no manner of doubt that the relief sought relate to the recovery of possession.
There can be absolutely no manner of doubt that the relief sought relate to the recovery of possession. The Division Bench ultimately while holding exclusion of jurisdiction of the arbitral tribunal held that that the recourse to arbitration under the terms of arbitration clause contained in the agreement of Leave and License would be baited by virtue of exclusive jurisdiction conferred upon the Court of Small Causes by section 41 (1) of the Presidency Small Cause Courts Act, 1882. 6. Applying the ratio laid down in the judgment cited supra to the facts of the instant case, it has to be concluded that the dispute raised by the petitioner falls within the exclusive jurisdiction of the special forum created under the provisions of Maharashtra Rent Control Act. Section 33 of the Act excludes the jurisdiction of any other forum including reference to arbitration. In this view of the matter, application tendered by the applicant seeking reference of the matter to the arbitral tribunal cannot be considered. Application thus is liable to be rejected and the same is accordingly rejected. Application rejected.