JAGRAT SHASTRI Vs. NUTAN TRAVELS (INDIA) PRIVATE LIMITED

JUDGEMENT

(1.) This petition is filed for appointment of an arbitrator to resolve disputes between the petitioner and the respondent arising out of a lease agreement dated 06.05.2000. The petitioner is an individual and is owner of furnished office premises situated at 125-A, Siddharth Complex, R.C.Dutt Road, Alkapuri, Vadodara ['said property' for short]. The respondent is a private company limited. The petitioner and the respondent entered into an agreement dated 06.05.2000 titled as 'lease agreement' in connection with the said property. Under such lease agreement, the petitioner leased out the said property to the respondent. The said agreement records that, the petitioner leased out the said property to the respondent for a monthly lease amount of Rs. 2,000/-. Respondent deposited a sum of Rs.6,000/- towards security deposit for outstanding dues or possible damage. The lease would commence from 06.05.2000 and would be in force at the first instance for a period of 36 months. After every 11 months, lease charges would be increased by 5%. The parties also agreed that the lessor would have the right to terminate the lease on breach of any of the conditions without prejudice to his right to realize arrears of rent. The contract contained an arbitration clause. Relevant terms of lease agreement read as under:

(2.) The parties simultaneously entered into a separate agreement for hire of furniture, fixtures and fittings of the said premise on 06.05.2000. Under this agreement, the respondent would pay a monthly sum of Rs. 5,000/- for utilizing such furniture, fixtures, fittings and services. Respondent would deposit a sum of Rs. 15,000/- towards security deposit. The period of service charge would commence from 06.05.2000 and would be in force at the first instance for a period of 36 months. After 11 moths, service charge would be increased by 5%. This agreement also contained an arbitration clause. Relevant provisions of this agreement are as under:

(3.) It is the case of the petitioner that the respondent occupied the premises, paid the lease rent but did not honour the commitment to revise the rates by 5% after initial period, as envisaged in both the agreements. The respondent, therefore, according to the petitioner had fallen in dues of Rs. 2,51,174/- which, the petitioner was entitled to recover. The petitioner, thereupon, issued a notice dated 08.03.2013 to the respondent and raised the demand of Rs. 2,51,174/- with interest and also asked for an undertaking that, the respondent shall remit the amount to compensate the losses suffered by the petitioner on account of what the petitioner described was a deliberate breach of contractual obligation. The petitioner finally reminded that upon failure to comply with the said demands, the petitioner would set in motion the legal action against the respondent.