2010 (2) TMI 1293

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....ontinued as a tenant holding over from month to month. On 16.8.1978 again an unregistered agreement was executed between the parties for a period of three years with the lease coming into effect from 03.03.1977. The three years term having expired by efflux of time on 03.03.1980, the appellant continued as a month to month tenant by holding over. The terms of the oral tenancy also kept on changing and on 01.01.2005, a new oral month to month tenancy came into existence whereunder the rent of the suit property was increased to Rs. 15,000/- per month. 3. On 30.08.2006, the respondent served upon the appellant a notice to quit to which the appellant replied on 30.10.2006. On 04.12.2006, a civil suit No. 286/2006 was filed by the respondent before the trial court for ejectment and recovery of mesne profits. The appellant filed an application under Section 8 of the Arbitration Act for referring the matter to a sole Arbitrator on the basis of an arbitration clause contained in the lease agreement dated 16.08.1978. This application was dismissed by the trial court holding that the terms of tenancy stood changed between the parties by an oral agreement and the defendant, therefore, coul....

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....s non-registration or because of its not having proper stamp duty, all its terms are inadmissible including the one which provides for an arbitration between the parties. An arbitration agreement can be enforced only along with the contract between the parties and such a contract must be a valid contract, admissible under law. If a contract is not admissible in law, every clause of it is inadmissible in law including arbitration clause.  6. Even if this lease agreement had been a registered lease agreement, on expiry of the lease period fixed in the original lease deed, the lease would have come to an end. Since no written lease deed was executed between the parties a new contract of tenancy had come into existence between the parties created orally. The parties cannot resort to the terms and conditions of the exhausted contract when a new contract had come into existence. If parties wanted that there should have been an arbitration clause between them in respect of further tenancy period, nobody stopped the parties from entering into such an agreement in writing, which is the basic requirement of any arbitration clause. Therefore, the reasoning of the petitioner that....

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....t appears from Clause 15 of the agreement that it provided for arbitration. The suit was instituted by the landlady on 01.07.2004 after expiry of term of agreement. Courts below have rightly held that after expiry of five years, the agreement was non-existent and the arbitration clause was not applicable. This view finds support from the law laid down by Hon'ble the Apex Court in Union of India v. Kishori Lal Gupta and Brothers AIR 1959 SC 1362.  8. In Ghulan Hassan Dar v. Controller of Aerodrome AIR 1987 J&K 25; Jammu & Kashmir High Court had considered a similar situation and observed as under:  After the expiry of the period of licence and after the expiry of period of agreement nothing survives for arbitration. The arbitration clause was for any dispute or difference of questions having regard to the covenants and conditions of the agreement and in respect of rights, duties and liabilities and duties of the contracting parties. This clause after the lapse of the agreement will cease to be effective because the petitioner's right as licensee has ended with the expiry of period of licence.  9. ....  10. .... ....

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.... till 12.10.2009, the respondent would be entitled to recover the possession of the premises through the process of the court. The present appeal arises from the aforesaid order. 10. Mr. Sandeep Sethi, the learned senior counsel for the appellant and Mr. Arun Mohan, the learned senior counsel for the respondent have been heard and the relevant documents adverted to by them have been perused. In the course of his submissions, Mr. Sandeep Sethi referred to the notice to quit dated 30.10.2006 and in particular to paragraph 10 of the said notice, which is reproduced as under:  10. That the contents of para No. 8 are denied to the extent that the commission on sales have been discontinued, however, it is admitted that the same have been included in the consolidated rent of Rs. 15,000/- per month. 11. Mr. Sethi also referred to paragraph 12 of the reply to the aforesaid notice, which reads as follows:  12. That the contents of para No. 10 are denied to the extent that the occupation of the premises by my clients is in terms of the aforesaid two agreements, it is not to be termed as a simple tenancy. However, the consolidated rent including the commission on sales in....

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....nd not at the present stage. 16. Even accepting the aforesaid contention of the learned Counsel for the appellant and for the time being, eliminating the said documents, that is, the rent receipts and the TDS certificate from consideration, I am of the view that the appellant in its pleadings having clearly admitted that there was a landlord-tenant relationship, that a consolidated rent of Rs. 15,000/- per month was being paid by it to the respondent and also that the respondent had served upon the appellant the notice to quit, which was replied to by the respondent, there was no impediment to the passing of a decree for ejectment on the aforesaid admissions, leaving the question of mesne profits to be tried on the basis of evidence adduced by the parties See Surjit Sachdeva v. Kazakstan Investment 66 (1997) DLT 54; Samir Mukherjee v. Devinder K. Bajaj 71 (1998) DLT 477; Vikas Theatres v. Punjab & Sind Bank 71 (1998) DLT 526; Shukla Malhotra v. Vyasa Bank Ltd. 73 (1998) DLT 124; Amar C. Talwar v. Export Promo Council 77 (1999) DLT 809; Deenar Builders v. Khoday Distilleries 82 (1999) DLT 809; Zulfiquar Ali Khan v. Straw Products 2000 VI AD (Delhi) 347; Jasmer Singh v. Electronic....

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....perative on this Court to use the powers reposed in it to prevent misuse of the judicial process, to cut short laws' delays and to save the aggrieved party from the travails of a long drawn out litigation, often outliving his life span itself and falling into the lap of his survivors. 19. As regards the plea of the appellant's counsel that the trial court has failed to appreciate that, the question whether the agreement dated 16.08.1978 was in fact a business agreement or purely a tenancy agreement was an issue in dispute, I am of the view that the findings of this Court in Civil Revision Petition No. 166/07 on this aspect of the matter are conclusive and binding in the instant appeal as well. This Court in the former case between the same parties having held that an oral tenancy on a month to month basis existed between the parties and the said finding having withstood the test of appeal before the Supreme Court, it is no longer open to this Court to hold that there was a business relationship subsisting between the parties and that too in the teeth of the clear admission of landlord-tenant relationship by the appellant. The principle of res judicata, as is well known, ....