M/S Indore Multi Functional Complex Private Limited v. Kotak Mahindra Bank Limited and Anr.

1. Allowed, subject to all just exceptions.

2. Applications stand disposed of. O.M.P.(I) (COMM.) 117/2023, O.M.P.(I) (COMM.) 118/2023 and O.M.P.(I) (COMM.) 121/2023

3. These petitions have been filed by the Petitioners under Section 9 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the ‘1996 Act’) seeking the following reliefs:- “O.M.P.(I) (COMM.) 117/2023 a) Restrain Respondent No.1 from invoking or alternately direct withdrawal of invocation of bank guarantee dated 20.1.2023 issued by Respondent No. 2 for an amount of Rs.1,19,18,376/-; and b) direct Respondent No.1 and 2 not to entertain and not to encash any invocation of the bank guarantee dated 29.12.2017 which was lastly renewed on 28.12.2022 for an amount of Rs.1,19,18,376/-; and c) Restrain respondent no. 2 to withhold termination of the sub-lease agreement till disposal of the present petition; and d) Restrain the respondents not to coerce the petitioner to enter the settlement without first getting registered the Sub-Lease Agreement dated 03.02.2016; and O.M.P.(I) (COMM.) 117/2023 & connected matters e) Direct the respondent No. 2 to honour all the Reliefs including covid relief and the waiver of the rent for 20 months given in writing to the petitioner; and damages amounting to Rs.3,30,47,835/-. O.M.P.(I) (COMM.) 118/2023 a) Restrain Respondent No.1 from invoking or alternately direct withdrawal of invocation of bank guarantee; and b) direct Respondent No.1 and 2 not to entertain and not to encash any invocation of the bank guarantee dated 05.03.2020 which was lastly renewed on 27.02.2023 for an amount of Rs.1,00,00,000/ -; and c) Restrain respondent no. 2 to withhold termination of the sub-lease agreement till disposal of the present petition; and d) Restrain the respondents not to coerce the petitioner to enter the settlement without first getting registered the Sub-Lease Agreement dated 26.10.2015; and e) Direct the respondent No. 2 to honour all the Reliefs including covid relief and the waiver of the rent for 28 months given in writing to the petitioner; and damages amounting to Rs.2, 92,20,472/-. O.M.P.(I) (COMM.) 121/2023 a) Restrain Respondent No.2 from invoking bank guarantee for an amount of Rs.1,58,70,000/-; and b) direct Respondent No.1 and 2 not to entertain and not to encash any invocation of the bank guarantee dated 29.12.2017 which was lastly renewed on 28.12.2022 for an amount of Rs.l,58,70,000/-; and c) Restrain respondent no. 2 to withhold termination of the sub-lease agreement till disposal of the present petition; and d) Restrain the respondents not to coerce the petitioner to enter the settlement without first getting registered the Sub-Lease Agreement dated 03.02.2016; and e) Direct the respondent No. 2 to honour all the Reliefs including covid relief and the waiver of the rent for 40 months given in writing to the petitioner; and damages amounting to Rs.3,29,56,600/-”

4. Disputes between the parties have arisen with respect to different Sub-Lease Agreements dated 03.02.2016, 26.10.2015 and 03.02.2016 respectively in the aforementioned petitions. Bank Guarantees were furnished by Respondent No.1 for and on behalf of the Petitioners in favour of Respondent No.2. Letter of Acceptance was issued, pursuant to which, these Sub-Lease Agreements were executed for the purpose of developing multi-functional complexes in various States. O.M.P.(I) (COMM.) 117/2023 & connected matters

5. Learned counsels appearing on behalf of the parties, on instructions, submit that in view of the arbitration clause in the Sub-Lease Agreements, parties are willing to be referred to arbitration and a sole Arbitrator be appointed by this Court in terms of clause 19 of the Sub-Lease Agreements.

6. I have heard the learned counsels for the parties. Admittedly, the dispute resolution mechanism incorporated in the Sub-Lease Agreements envisages adjudication of disputes by a sole Arbitrator. Clause 19 which is similar in all the three Sub-Lease Agreements is as follows:

7. With the consent of the parties, the following directions are issued:- (a) Justice Mukta Gupta, Former Judge of Delhi High Court (Mob. No.9650788600) is appointed as a sole Arbitrator to O.M.P.(I) (COMM.) 117/2023 & connected matters adjudicate upon the disputes between the parties pertaining to and in respect of the three Sub-Lease Agreements dated 03.02.2016, 26.10.2015 and 03.02.2016 respectively. (b) Learned Arbitrator is requested to furnish a declaration in terms of Section 12 of the 1996 Act, prior to entering upon reference;

(c) Fees of the learned Arbitrator shall be regulated as per the

8. Since the Arbitral Tribunal has been constituted, it is open to the Petitioners to approach the learned Arbitrator for seeking any interim relief under Section 17 of the 1996 Act, if required.

9. It is made clear that this Court has not expressed any opinion on the merits of the case and it is open to the learned Arbitrator to decide the application as and when it is filed, in accordance with law and in the facts and circumstances of the case.

10. Since there is an urgency expressed by learned counsel for the Petitioners, the learned Arbitrator is requested to enter upon reference and fix the first date of hearing, as expeditiously as possible and as per mutual convenience of the learned Arbitrator and the parties.

11. Petitions stand disposed of with the aforesaid directions.

JYOTI SINGH, J AUGUST 10, 2023