Hemant Gupta C.J.- The petitioner, owner of a Premises at Bhopal, has sought resolution of the disputes between the parties arising out of an agreement dated 7.12.2010, whereby the Premises described in the agreement, were given on license for a period of three years i.e. from 7.12.2010 ending on 30.11.2013.
The relevant clauses of the agreement read as under:-
"2. That the period of usage of the said Premises shall be 3 (Three) years starting from 07/December/2010 and ending on 30th/November/2013.
xxx xxx xxx
8. That the outer security of the Premises shall be the responsibility of Sekurit Company according to their normal protocol, whose charges are payable by the Hirer, and the Hirer shall enter into a separate agreement with the said designated Security Agency, at the approved rates and terms of the Company.
xxx xxx xxx
15. That the said Premises may/shall be vacated by giving 6 (Six) month''''s clear notice by the Hirer or the Company to the other party. If the Hirer does not give the said notice for vacation, then the deposit under clause 5 mentioned above, shall be forfeited by the Company. Provided, however that vacation by either party shall not be sought before the expiry of 1 (One) year from the commencement of usage.
16. That it is expressly agreed between the parties that this Hiring Agreement shall remain in force throughout the period hereinbefore mentioned, and neither the Company, nor the Hirer shall be entitled to the vacation of the Premises or termination of this agreement, except as provided in clause 15 or by some act of God, or as may be mutually agreed upon.
17. That the Company agrees that the Hirer paying the Hiring and other charges hereby reserved, and observing and performing the conditions herein above contained shall and may peacefully enjoy the use of the Premises during permitted working hours for the whole period herein provided, without let or hindrance by the Company except as provided in clause 16 above.
18. That in the event of any dispute between the parties with regard to the provisions of this agreement the same shall be settled by arbitration as per provisions of the Arbitration and Conciliation Act, 1996."
2. The respondent hereinabove has not vacated the alleged licensed Premises after the expiry of license period. Thereafter, the petitioner served a notice dated 3.10.2015, seeking consent of the respondent for resolution of the dispute by a sole arbitrator. Since there was no consent forthcoming from the respondent, the petitioner invoked the jurisdiction of this Court under section11(6) of the Arbitration and Conciliation Act, 1996 (for short the ''''Act''''), on 2.12.2015.
3. In reply, the stand of the respondent interalia is that the agreement is not an agreement of license, but is an agreement of tenancy and, therefore, the dispute between the parties cannot be referred to an arbitrator, as a tenant could be evicted from the Premises only in accordance with provisions of MP Accommodation Control Act, 1961. It is also contended that there is no dispute in respect of any of the terms of the agreement; therefore, the arbitration clause cannot be resorted to by the petitioner.
4. Learned counsel for the petitioner relies upon Section 11(6A) as well as Section 16(1)(a) of the Act, to contend that the arbitration clause is an independent clause, independent of other terms of the contract, and therefore, even after the expiry of the license period, the dispute between the parties arising out of the agreement have to be referred to an arbitrator. Reliance is placed upon the judgments of the Supreme Court reported asN. N. Srinivasa v. Kuttukaran Machine Tools Limited . (AIR 2009 SC 2217);Ashapura Mine-Chem Limited v. Gujarat Mineral Development Corporation ., (2015) 8 SCC 193; and,Indian Oil Corporation Limited v. Sps Engineering Limited ., 2011 (3) SCC 507, to contend that even if the agreement is void, still the dispute between the parties have to be referred to an arbitrator.
5. The dispute between the parties is not in respect of any terms of the agreement. The dispute is after expiry of the period of the license arising out of the term of agreement. The petitioner asserts as the respondent has not handed over possession of the Premises to the petitioner and thus the respondent is a ''''trespasser''''.
6. The dispute between the parties with regard to provisions of ''''this agreement'''' are to be settled by an Arbitral Tribunal as per clause 18 of the agreement reproduced above. Therefore, the dispute to be decided by an Arbitral Tribunal has to be in respect of provisions of ''''this agreement'''' i.e. in respect of any of the terms of the agreement. The period of usage of the Premises came to an end on 30.11.2013. There is no clause in the agreement as to what will happen after the expiry of the license period. Since there is no dispute in respect of any of the terms of the agreement, therefore, any dispute arising after the expiry of the period specified in the agreement cannot be referred to an arbitrator, as such dispute was not agreed to be resolved by an arbitrator.
7. The Judgment in N. Srinivasa''''s case (supra) arises out of the fact wherein the parties entered into an agreement for sale of the property in dispute. The dispute arose when the owner failed to execute sale deed in pursuance of an agreement to sell. Hon''''ble Supreme Court found that the High Court has not gone into the question regarding whether the time was essence of the contract or not, therefore, such question was required to be decided by an arbitrator. It is in this background, the Court held that the Arbitral Tribunal is required to decide if the time was essence of the agreement or that agreement ceases to exist or not. Thereafter the Court observed as under:
"36. That apart, the survivability of the arbitration clause in the agreement was also questioned by the respondent in their objection to the application for injunction but since that question has also been kept open for the decision of the arbitrator by the High Court as well, we have no hesitation in our mind to hold that since the said question shall also be decided by the arbitrator while deciding the disputes between the parties, there is no ground why the order of status quo granted by the trial court shall not be maintained till the award is passed by the arbitrator.
37. It is well settled that even if an agreement ceases to exist, the arbitration clause remains in force and any dispute pertaining to the agreement ought to be resolved according to the conditions mentioned in the arbitration clause. Therefore, in our view, the High Court was not justified in setting aside the order of the trial court directing the parties to maintain status quo in the matter of transferring, alienating or creating any third-party interest in the same till the award is passed by the sole arbitrator".
8. Thus the question before the Court was in relation to specific performance of an agreement of sale of property. Such agreement remains in force and any dispute pertaining to the agreement ought to be resolved according to the conditions mentioned in the arbitration clause. The dispute was in respect of terms of the agreement, therefore, the dispute was required to be decided by an Arbitral Tribunal alone.
9. In the present case, for the sake of repetition, it may be stated that there is no dispute in respect of any of the term of the agreement, which alone could be referred to an Arbitral Tribunal. The dispute is that after the expiry of the period of usage that is not handing over possession by the respondent. The handing over of possession was not a condition in the agreement; that the Arbitral Tribunal cannot be constituted to decide disputes which are outside the agreement.
10. In M/s SPS Engineering Limited''''s case (supra), the contract was awarded to carry out infrastructure work relating to drinking water system. The Hon''''ble Supreme Court held that in an application under Section 11 of the Act, the Chief Justice or his designate is not expected to go into the merits of the claim, and examine the tenability of the claim under section 11 of the Act. I do not find that such judgment is of any help to the petitioner as the nature of possession, whether as a tenant or a licensee, is not being examined by this Court, as that is the matter which is required to be decided by the competent authority. I find that the arbitration clause is not applicable in respect of a dispute arising after the expiry of the usage period.
11. In Ashapura Mine-Chem Limited''''s case (supra), the Court was considering an arbitration clause contained in the Memorandum of Understanding (for short ''''MOU''''), relating to a Joint Venture. Again, in the said case, the dispute arose in respect of the terms of the MOU, whereas there is no dispute in respect of the agreement in the present case, but the dispute is only after the expiry of the period of agreement. In view of such facts, even the said Judgment is of no help to the petitioner.
12. The reliance of the petitioner upon Section 11(6A) and Section 16(1)(a) of the Act is misconceived. Though arbitration clause is an independent clause and can be resorted to even if the agreement is void, but the arbitration clause in the present case on templates the dispute to be resolved by an Arbitrator with regard to the provisions of the ''''this agreement'''' alone. Since there is no dispute in respect of any of the terms of the ''''agreement'''', therefore, the dispute cannot be referred to an Arbitrator in view of the fact that even if the clause relating to dispute resolution is considered to be independent, but the disputes which are arising out of the ''''agreement'''' alone could be referred to the Arbitral Tribunal.
13. In view thereof, I find that the consequences of non-handing over of possession of the Premises after the expiry of the usage period is not a dispute referable to an arbitrator.
14. Consequently, I do not find any merit in the present petition. It is accordingly dismissed.