UNION OF INDIA Vs. SATYA DEVI

JUDGEMENT

(1.) THIS is an appeal against an order of the Sub Judge (A. D. M.) Jammu rejecting the application filed by the defendant for staying the proceedings in view of an arbitration clause in the agreement between the parties which is the subject matter of the suit.

(2.) THE plaintiff filed the present action for ejecting the defendant on the ground that the lease had expired by efflux of time and that the plaintiff wanted the house for her personal necessity. Under the terms of the lease, between the plaintiff and the defendant it was specifically agreed to between the parties that after the expiry of the lease, the lease would be renewed at the option of the lessee if certain conditions were fulfilled In this connection clause 14 of the lease runs thus : -

(3.) ANOTHER clause in the lease deed which is clause 17 provides that if there is any dispute or difference between the parties, it should be referred to an arbitrator to be appointed by the Government of India. The stand taken by the defendant was that as the controversy between the parties centered round the interpretation of the terms of the lease, the matter should have been referred toâ„¢ arbitration and the suit should have been stayed under Section 34 of the Arbitration Act - The learned Judge has, however, held that as there was no relationship of landlord and tenant between her and the defendant the arbitration clause cannot be invoked at all We are, unable to agree with the view taken by the learned Subordinate Judge. Clause 14 of the lease, which has been quoted above, gives a clear option to the lessee to renew the lease and once the lessee exercises such an options the lease would stand renewed, and the lesser has no discretion in the matter. The only limitation imposed on the renewal of lease is that the lessee should have committed any breach of the terms of the contract. It is not disputed that the defendant had in fact issued a notice within the time prescribed by clause 14 of the agreement exercising its option of renewing the lease. It is also not disputed that there was any breach of any covenant of the lease by the lessee. In these circumstances, therefore, it is clear to us that once the defendant exercised his option in renewing the lease under clause 14 of the agreement, it cannot be said that the lease had come to an end and the relationship of landlord and tenant had ceased to exist. Learned counsel for the other side submitted that the notice for renewal given by the defendant was not by a competent authority, and therefore, the lease must be deemed to have expired Even this, in our opinion, would be really a matter of interpretation of clause 14 of the agreement of the lease and it cannot be said in these circumstances, that arbitration clause cannot be invoked. In fact, the arbitrator would be in a much better position to decide as to whether the notice was given by a competent person or not, than the court. It is not the allegation of the plaintiff that the contract itself was void or anything of the sort. In these circumstances, therefore the controversy between the parties is, no doubt, regarding the interpretation, of certain terms of the lease and is, therefore, clearly covered by clause 17, the arbitration clause in the agreement between the parties.