Full Judgment Text
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* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of Decision: 16.01.2025
+ FAO (COMM) 12/2025
WTC NOIDA DEVELOPMENT COMPANY PVT. LTD.
.....Appellant
Through: Mr. Shaunak Kashyap, Ms.
Nistha Gupta & Ms. Gayatri
Dahiya, Advs.
versus
MS. ARTI KHATTAR & ORS. .....Respondents
Through: None.
CORAM:
HON’BLE MR. JUSTICE NAVIN CHAWLA
HON’BLE MS. JUSTICE SHALINDER KAUR
NAVIN CHAWLA, J (ORAL)
CM APPL. 2672/2025—exp.
1. Allowed, subject to just exceptions.
FAO (COMM) 12/2025 & CM APPL. 2671/2025—Addl.doc.
2. This appeal has been filed by the appellant, challenging the
Order dated 13.01.2025 passed by the learned District Judge
(Commercial Court-6), South-East, Saket District Court, in OMP (I)
(COMM.) No.2/2025, titled WTC Noida Development Company Pvt.
Ltd. vs. Ms. Arti Khattar & Anr., dismissing the petition filed by the
appellant under Section 9 of the Arbitration and Conciliation Act,
1996, as being not maintainable, holding that the arbitration clause
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contained in the lease deed dated 01.11.2013 was no longer binding
on the parties.
3. The learned counsel for the appellant submits that the appellant
had taken on lease commercial space in Plaza M-6, Uppal Plaza,
Jasola Commercial Complex, New Delhi, from the respondents vide a
lease deed dated 01.11.2013. The said lease deed admittedly contained
an arbitration agreement between the parties in the form of Clause 7
(e), thereof. The lease was initially for a period of three years. It was
later extended for a period of further three years, until 31.10.2019. It
was later extended on the same terms and conditions on 22.06.2020,
and 01.04.2021. By a notice dated 05.12.2024, the respondent directed
the appellant to vacate the leased premises, and thereafter, on
04.01.2025, directed the Maintenance Agency to disconnect the
utilities at the premises. The Maintenance Agency, acceding to the
direction, disconnected the electricity and water supply to the lease
premises on 05.01.2025. Aggrieved of the same, the appellant filed the
abovementioned petition under Section 9 of the Arbitration and
Conciliation Act, 1996, inter alia, pleading as under:
“12. Despite the Petitioner's best efforts to
maintain the commercial relationship shared
with Respondents No. 1 & 2, an email dated
05.12.2024 was sent to the Petitioner
demanding it to vacate the demised premises.
After telephonic discussion to resolve the
issues amicably and reaching an oral
agreement on the same, the Petitioner
addressed an email dated 26.12.2024 to
Respondents No. 1 & 2, regarding the
continuation of lease and transferring the
lease agreement to an associated company
vide simultaneous termination of existing lease
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agreement with WTC Noida Development
Company Private Limited and execution of
fresh lease deed with Propbridge Services
Private Limited. Accordingly, a proposal to
adjust the amount of rent accruing till
31.12.2024 from the Security Deposit and
terminate the Lease Deed at the end of
December 2024. Furthermore, the petitioner
requested Respondents No. 1 & 2 to execute a
fresh lease deed in favour of „Propbridge
Services Private Limited' with effect from
01.01.2025. In response, Respondents No. 1 &
2 sought the details of the Security Deposit to
facilitate the settlement of dues. Pursuant
thereto, a draft cancellation deed had also
been drawn up between the Parties, however,
it is yet to be executed. A copy of the email
dated 05.12.2024 sent to the Petitioner is
annexed herewith and marked as
DOCUMENT - 7.
13. In January 2025, soon after the
intervening holiday period was over, the
Parties resumed with the formalities for
transferring of the Lease Deed. On
03.01.2025, the Parties were in the process of
exchanging financials to facilitate the transfer.
While this process was still underway, to the
utter shock and surprise of the Petitioner,
Respondent No. 2 sent an email dated
04.01.2025 to Respondent No. 3 (Maintenance
Agency) directing it to disconnect the supply of
essential utilities i.e., electricity and water for
the demised premises. In response, Respondent
No. 3 sent an email dated 05.01.2025 acceding
to the aforesaid request of disconnecting
supply of electricity and water for the demised
premises. True copies of emails dated
04.01.2025 and 05.01.2025 are annexed
herewith and marked as DOCUMENT - 8
(COLLY).”
4. The learned counsel for the appellant submits that the learned
District Judge, at a preliminary stage of the petition and without even
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issuing notice of the same to the respondents, has dismissed the
petition, holding that the arbitration agreement contained in the lease
deed dated 01.11.2013, was no longer valid. He submits that the
learned District Judge has misconstrued the pleadings especially
paragraph 12 and 13 of the petition.
5. The learned counsel for the appellant further submits that the
learned District Judge has placed reliance on the judgment of this
Court in Mukesh Khurana vs. Rahul Chaudhary , 2024 SCC OnLine
Del 4686. He submits that the said Judgment has been stayed by the
Supreme Court vide an Order dated 25.10.2024 passed in Special
Leave Petition (Civil) 23980/2024.
6. We have considered the submissions made by the learned
counsel for the appellant.
7. As the learned District Judge dismissed the petition filed by the
appellant without even issuing notice of the same to the respondents,
we do not deem it necessary to issue notice of this appeal to the
respondents.
8. In Vidya Drolia v. Durga Trading Corpn. (2021) 2 SCC 1, the
Supreme Court held that it is only rarely and as a demurrer that the
court may interfere at the stage of Section 8 and/or Section 11 of the
Arbitration and Conciliation Act when “it is manifestly and ex facie
certain that the arbitration is non-existent, invalid or the disputes are
non-arbitrable”.
9. In SBI General Insurance Co. Ltd. v. Krish Spinning, 2024
SCC OnLine SC 1754, the Supreme Court held that “ whether there
has been a discharge of contract or not is a mixed question of law and
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fact, and if any dispute arises as to whether a contract has been
discharged or not, such a dispute is arbitrable as per the mechanism
prescribed in the underlying contract ”. It was held that the arbitration
agreement, by virtue of presumption of separability, survives the
principal contract in which it was contained. The Arbitration
Agreement forming part of a contract is treated as an agreement
independent of other terms of the contract. The question whether the
underlying agreement stands discharged, itself may be a dispute
arising out of or in relation to or under the substantive contract, and
would not be precluded from reference to arbitration.
10. In the present case, the learned District Judge had not even
called upon a response from the respondents as to whether they admit
to the existence of an arbitration agreement between the parties. It was
not an objection of the respondents that the arbitration agreement was
no longer in existence. It was, therefore, premature for the learned
District Judge to have determined this issue ex-parte without even
calling upon the respondent to give its stand on the same. The above-
referred pleadings of the appellant, in our view, do not in any manner
justify a finding that the arbitration agreement between the parties
stood extinguished. The learned District Judge has, therefore, fallen in
passing the Impugned Order and dismissing the petition filed by the
appellant in-limine .
11. Accordingly, we set aside the Impugned Order and remand the
matter back to the learned District Judge. The appellant shall appear
st
before the learned District Judge on 21 January, 2025.
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12. We make it clear that we have not given any finding on the
existence or non-existence of the arbitration agreement or on the
arbitrability of the disputes raised by the appellant. These issues
would have to be considered afresh by the learned District Judge after
receiving a response from the respondent, while remaining influenced
by any observation made in the Impugned Order dated 13.01.2025.
13. Order dasti .
(NAVIN CHAWLA)
JUDGE
(SHALINDER KAUR)
JUDGE
JANUARY 16, 2025/ab/sk/IK
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Digitally Signed
By:NEELAM
Signing Date:20.01.2025
17:51:52