Rent control proceedings cannot be referred to arbitration where statute vests exclusive eviction control in the Rent Controller.

An arbitration clause in a lease deed could not override proceedings under the C. P. and Berar Letting of Houses and Rent Control Order, 1949, because the statute vested exclusive power to grant or refuse eviction permission in the Rent Controller. The special rent control scheme was treated as a complete code, so the dispute could not be transferred to an arbitrator by private agreement. Any attempt to contract out of the protective legislation was contrary to public policy under Section 23 of the Indian Contract Act, 1872. A stay under Section 34 of the Arbitration Act, 1940 was therefore not maintainable and the rent control proceedings remained outside arbitration.

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Issues: Whether proceedings under the C. P. and Berar Letting of Houses and Rent Control Order, 1949 could be stayed under Section 34 of the Arbitration Act, 1940 on the basis of the arbitration clause in the lease deed.

Analysis: The arbitration clause could not govern a dispute arising under a special rent control law enacted to regulate eviction and protect tenants. The statutory scheme vested the power to grant or refuse permission for eviction exclusively in the Rent Controller, and that power could not be transferred to an arbitrator by agreement. Any attempt to take the matter outside the statutory forum would amount to contracting out of the protective legislation and would be opposed to public policy within the meaning of Section 23 of the Indian Contract Act, 1872. The Rent Control Order was treated as a complete code for the field it covered, leaving no room for an arbitral tribunal to decide the question or for a stay under Section 34 of the Arbitration Act, 1940.

Conclusion: The application for stay under Section 34 of the Arbitration Act, 1940 was not maintainable and the rent control proceedings could not be referred to arbitration.

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