VIDYA DROLIA & ORS. versus DURGA TRADING CORPORATION

VIDYA DROLIA & ORS. versus DURGA TRADING CORPORATION

The Transfer of Property Act is silent on arbitrability and ss.111, 114 and 114A do not, by necessary implication, exclude arbitration; the decisions in Natraj Studios and Booz Allen do not decide the question for Transfer of Property Act cases, and the decision in Himangni Enterprises requires reconsideration by a Bench of three judges; accordingly the matter is referred to a larger Bench, and arbitral proceedings already underway may continue (stay lifted) though any award cannot be executed without applying to this Court.

Parties
Appellants (tenants): Vidya Drolia & Ors.; Respondent (landlord): Durga Trading Corporation
Jurisdiction
India
Judgment Date
28 February 2019
Procedural Posture
Civil Appeal (civil Appeal No. 2402 of 2019) / Appeal to the Supreme Court; Judgment Disposing Appeal, Referring Question to Larger Bench
Outcome
Appeal disposed; matter referred to a Bench of three Judges for reconsideration; stay on arbitral proceedings lifted.
Legal Topics
Arbitrability, Determination of Lease (s.111 TP Act), Relief Against Forfeiture (ss.114, 114 a TP Act), Section 11(6 A) of Arbitration Act
Arbitration and Conciliation Act, 1996 Transfer of Property Act, 1882 Landlord and Tenant Law Civil Procedure (mesne Profits) Arbitrability Determination of Lease (s.111 TP Act) Relief Against Forfeiture (ss.114,114 a TP Act) Section 11(6 A) of Arbitration Act

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Parties

Vidya Drolia & Ors.

Appellants (tenants)

Durga Trading Corporation

Respondent (landlord)

Procedural Posture

Civil Appeal (civil Appeal No. 2402 of 2019) / Appeal to the Supreme Court; Judgment Disposing Appeal, Referring Question to Larger Bench

Legal Issues

  1. 1 Whether disputes between landlord and tenant governed by the Transfer of Property Act, 1882 are arbitrable
  2. 2 Whether ss.111, 114 and 114A of the Transfer of Property Act imply exclusion of arbitration by necessary implication
  3. 3 Whether the scope of Section 11(6A) of the Arbitration & Conciliation Act permits courts to decline reference where subject-matter is non-arbitrable

Ratio Decidendi

The Transfer of Property Act is silent on arbitrability and ss.111, 114 and 114A do not, by necessary implication, exclude arbitration; the decisions in Natraj Studios and Booz Allen do not decide the question for Transfer of Property Act cases, and the decision in Himangni Enterprises requires reconsideration by a Bench of three judges; accordingly the matter is referred to a larger Bench, and arbitral proceedings already underway may continue (stay lifted) though any award cannot be executed without applying to this Court.

Court Disposition

Appeal disposed; matter referred to a Bench of three Judges for reconsideration; stay on arbitral proceedings lifted.

Orders

  • Matter referred to a Bench of three Hon'ble Judges to reconsider Himangni Enterprises and related questions of arbitrability under the Transfer of Property Act
  • Stay on arbitral proceedings lifted and arbitral proceedings may continue to an award