AI Drafter 
TaxTMI 
TaxTMI 
2016 (12) TMI 1675
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....of the Supreme Court of India. 4. The disputes between the parties relate to the payment of lease rent and fees for facility management, in respect of the premises (hereafter 'the said premises'), which were taken on lease by Store One in a commercial complex known as "Shop in Park (North)". The lease for the said premises was terminated by Store One prior to the expiry of the lock-in period and that had resulted in claims, inter alia, for rent/damages being made against Store One. 5. The Arbitrator considered the disputes and awarded rent for the period 01.04.2008 to 22.03.2010 alongwith interest at the rate of 12% per annum up to the date of the award in favour of M/s Annapurna Infrastructure Pvt. Ltd. (hereafter 'Annapurna') and M/s Paliwal Overseas Pvt. Ltd (hereafter 'Paliwal'). Further, the Arbitrator also awarded damages equivalent to the rent for a period of six months from 22.03.2010 in favour of Annapurna and Paliwal along with future interest at the rate of 12% per annum. In addition, the Arbitrator also made an award in favour of M/s Pragya Products Pvt. Ltd. (hereafter 'Pragya') for facility management services and electricity charges alongwith interest a....
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....nterest free refundable security deposit. After the mall was constructed, Store One was put in possession of the said premises, admeasuring 67,613 square feet for its outlet. In terms of the Lease Deed between Store One and Pragya, Store One commenced payment of monthly rent of Rs. 41,78,348.18/- with effect from 20.09.2007 to Pragya. 7.4 Thereafter, on 08.08.2008, Pragya executed sale deeds - sixteen in number - in favour of Annapurna and Paliwal. By virtue of the sale deeds, Annapurna and Paliwal became joint owners of the property in question including the said premises. Although, Annapurna and Paliwal became owners of the property in question, Pragya continued to be liable for providing facilities/services. 7.5 Store One claims that there were deficiencies in the services rendered and, therefore, Store One stopped the payment of Common Area Maintenance (CAM) charges from July, 2008. Thereafter, Store One issued a notice dated 05.08.2008 under Clause 7.2 of the Lease Deed to Pragya indicating certain deficiencies and called upon Pragya to rectify the same as per Clause 7.2 of the Lease Deed. 7.6 On 01.09.2008 and 04.09.2008, Annapurna and Paliwal sent notices to Store O....
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....riod but were also obligated to mitigate the damages by letting out the said premises; therefore, the Arbitrator limited the damages to rent equivalent to six months. 9. The operative part of the impugned award is set out below:- "10. CONCLUSIONS: 10.1 In the light of the discussion, analysis and conclusion abovestated, all the issues as framed stand answered. 10.2 Annapurna is entitled to the following amount from Store One: a. Rs. 2,67,52,283/- on account of rent from 01.04.2008 upto 22.03.2010 along with interest @ 12% per annum w.e.f. 23.03.2010 upto the date of Award. Be it stated that the aforesaid sum is arrived at after deducting the security deposited by Store One and ordered to be paid back in terms of order contained herein. b. Rs. 1,11,56,145/- on account of damages equivalent to rent for a period of 6 months from 22.03.2010. c. Future interest @ 12% per annum on the amounts, as calculated above, from the date of the Award till the date of realization. 10.3 Paliwal is entitled to the following amount from Store One: a. Rs. 2,67,52,283/- on account of rent from 01.04.2008 upto 22.03.2010 alo....
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....of six months after Store One had admittedly handed over the possession of the said premises. He submitted that Arbitrator had assumed that six months was a reasonable time for Annapurna and Paliwal to find alternate tenant(s). However, there was no material or evidence on record on the basis of which the Arbitrator could have formed this view. He submitted that since the Arbitrator had accepted Store One's contention that after issuance of the notice of termination, Annapurna and Paliwal were under an obligation to mitigate the loss by leasing out the premises to another tenant, the Arbitrator could not have assumed an arbitrary period for Annapurna and Paliwal to do so. Since Paliwal and Annapurna had not taken steps to mitigate their damages, they would not be entitled to claim the same from Store One. He also submitted that there was no reason to arbitrarily fix 22.03.2010 as the date from which the period of six months would begin. 13. I have heard the learned counsel for the parties at length. 14. In order to appreciate the contention that the notice dated 05.08.2008 issued by Store One was not vague, as held by the Arbitrator, it is necessary to refer to Clause 7.2....
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....e deficiencies pointed out also lacked the necessary specifics. In view of the above, the Arbitrator's conclusion that the notice was vague and untenable cannot by any stretch be held to be perverse or patently illegal. The Arbitrator further held that the notice of termination dated 08.09.2008 was also untenable since the same had not been addressed to Annapurna and Paliwal. The Arbitrator had noticed that, admittedly, prior to the issuance of notice of termination dated 08.09.2008, Store One had received legal notices dated 01.09.2008 and 04.09.2008 on behalf of Annapurna and Paliwal respectively wherein Store One was informed that Annapurna and Paliwal had acquired the said premises from Pragya. Thus, the notice of termination was required to be addressed to Annapurna and Paliwal which was admittedly, not done. The conclusion of the Arbitrator that the termination of lease was thus invalid, is also not amenable to judicial review under Section 34 of the Act since the same is neither patently illegal nor perverse. 18. The contention that Annapurna and Paliwal were always aware of the termination of the lease and therefore the termination of the Lease Deed ought to be held vali....