# Chitra Misra & Ors v. M/S Decathlon Sport India Pvt. Ltd. & Anr

- **Citation:** (2024) 5 ILRA 1251
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2024-05-21
- **Case number:** Matter Under Article 227 No. 2475 of 2024
- **Bench:** Subhash Vidyarthi
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/chitra-misra-ors-v-m-s-decathlon-sport-india-pvt-ltd-anr-52028
- **Pages:** 15

## Headnote

Civil Law - Arbitration & Conciliation Act,
1996 - Sections 7, 11, 16(2) & 37 -
Commercial Court Act, 2005 - Section
13(1A) - Insolvency and Bankruptcy Code,
2016 - Sections 14 & 238 - Transfer of
Property Act, 1882 - Section 109 -
Claimants have purchased various portions
of property, taken on lease by respondent
no. 1 from M/s Rohtas Projects Limited, in
violation of terms and conditions of
registered lease deed - There is no
arbitration
agreement
between
the
petitioners and respondent no. 1, the
petitioners
initiated
arbitration
proceedings claiming payment of arrears of
rent, interest on arrears of rent, damages
for use and occupation of property at the
rate of rent, interest on damages, eviction
of respondent no. 1 from demise premises
and cost of proceedings - The proceedings
under IBC have been initiated against
lessor M/s Rohtas Projects Limited - A
Resolution
Professional
has
been
appointed
by
NCLT,
New
Delhi
-
Respondents have deposited entire arrears
of rent and damages etc. in NCLT and
already vacated the premises in dispute -
Hence, in view of facts and circumstances,
orders passed by Sole Arbitrator and
Commercial Court, Lucknow didn't require
any interference, dismissed. (Para 43, 44)
Petition dismissed. (E-13)

List of Cases cited:

## Text

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5 All. Chitra Misra & Ors. Vs. M/S Decathlon Sport India Pvt. Ltd. & Anr.
1251
violation of fundamental principles of law or
justice, where if the High Court does not
interfere,
a
grave
injustice
remains
uncorrected. It is also well settled that the
High Court while acting under this article
cannot exercise its power as an appellate
court or substitute its own judgment in place
of that of the subordinate court to correct an
error, which is not apparent on the face of
the record. The High Court can set aside or
ignore the findings of facts of an inferior
court or tribunal, if there is no evidence at
all to justify or the finding is so perverse,
that no reasonable person can possibly
come to such a conclusion, which the court
or tribunal has come to."

20. In light of the aforesaid, it is palpably
clear that the Commercial Court at Gautam
Buddh Nagar has failed to exercise its
jurisdiction. Accordingly, this Court, in
exercise of its power under Article 227 of the
Constitution of India sets aside the impugned
order dated March 15, 2022 passed by the
Commercial Court, Gautam Buddh Nagar.
This Court also directs the Commercial Court,
Gautam Buddh Nagar to adjudicate the
application filed by the petitioners under
Section 34 of the Act expeditiously, preferably
within a period of six months from date.

21. With the above directions, this
petition is allowed. There shall be no order
as to the costs.
----------
(2024) 5 ILRA 1251
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: LUCKNOW 21.05.2024

BEFORE

THE HON'BLE SUBHASH VIDYARTHI, J.

Matter Under Article 227 No. 2475 of 2024

Chitra Misra & Ors. ...Petitioners
Versus
M/S Decathlon Sport India Pvt. Ltd. & Anr.
 ...Opp. Parties

Counsel for the Petitioners:
Pritish Kumar, Amal Rastogi

Counsel for the Opp. Parties:
Sanjeev Singh

Civil Law - Arbitration & Conciliation Act,
1996 - Sections 7, 11, 16(2) & 37 -
Commercial Court Act, 2005 - Section
13(1A) - Insolvency and Bankruptcy Code,
2016 - Sections 14 & 238 - Transfer of
Property Act, 1882 - Section 109 -
Claimants have purchased various portions
of property, taken on lease by respondent
no. 1 from M/s Rohtas Projects Limited, in
violation of terms and conditions of
registered lease deed - There is no
arbitration
agreement
between
the
petitioners and respondent no. 1, the
petitioners
initiated
arbitration
proceedings claiming payment of arrears of
rent, interest on arrears of rent, damages
for use and occupation of property at the
rate of rent, interest on damages, eviction
of respondent no. 1 from demise premises
and cost of proceedings - The proceedings
under IBC have been initiated against
lessor M/s Rohtas Projects Limited - A
Resolution
Professional
has
been
appointed
by
NCLT,
New
Delhi
-
Respondents have deposited entire arrears
of rent and damages etc. in NCLT and
already vacated the premises in dispute -
Hence, in view of facts and circumstances,
orders passed by Sole Arbitrator and
Commercial Court, Lucknow didn't require
any interference, dismissed. (Para 43, 44)
Petition dismissed. (E-13)

List of Cases cited:

1. Mayavati Trading (P) Ltd. versus Pradyuat
Deb Burman, (2019) 8 SCC 714

2. Duro Felguera, S.A. versus Gangavaram Port
Ltd., (2017) 9 SCC 729

3. Vidya Drolia & ors. Vs Navrang Studios:
(1981) 1 SCC 523
1252 INDIAN LAW REPORTS ALLAHABAD SERIES
4. Food Corporation of India Versus Indian
Council of Arbitration & ors.: AIR 2003 SC 3011

5. Hindustan Petroleum Corporation Limited
Versus Pink City Midway Petroleum: AIR 2003
SC 2881

6. Shri Subh Laxmi Fabrics (P) Limited Versus
Chandmal Barodia & ors.: AIR 2005 SC 2261

7. Ambica Prasad Vs Alam & ors.: (2015) 13 SCC
13

8. Surender Kumar Singhal Vs Arun Kumar
Bhalotia, 2021 SCC OnLine Del 3708

9. ONGC Ltd. Vs Discovery Enterprises (P) Ltd.,
(2022) 8 SCC 42

(Delivered by Hon'ble Subhash Vidyarthi J.)

1. Heard Sri Pritish Kumar and Sri
Amal Rastogi Advocates, the learned
counsel for the petitioners and Sri S.C.
Mishra, Senior Advocate assisted by Sri
Sanjeev
Singh,
Advocate
for
the
respondents.

2. By means of instant petition filed
under Article 227 of the Constitution of
India, the petitioners have challenged the
validity of an order dated 15.07.2022 passed
by Hon'ble Justice Shri Dilip B. Bhosale
(retired), Sole Arbitrator in the arbitration
proceedings instituted by the petitioners
against the respondents, whereby an
application under Section 16(2) of the
Arbitration & Conciliation Act, 1996
(hereinafter referred to as 'the Arbitration
Act') has been allowed and the arbitration
proceedings have been dropped for want of
jurisdiction, leaving it open to the parties to
take appropriate remedy for redressal of
their grievances at proper stage before
appropriate Forum. The petitioners have
also challenged the validity of the judgment
and order dated 30.01.2024 passed by the
Presiding Officer, Commercial Court No. 1,
Lucknow in Arbitration Case No. 124 of
2022, dismissing an application under
Section 13(1A) of the Commercial Court
Act, 2005 read with Section 37 of the
Arbitration Act, filed by the petitioners,
challenging the aforesaid order dated
15.07.2022 passed by the Sole Arbitrator.

3. Briefly stated, facts of the case
are that M/s Rohtas Projects Limited had
executed a lease deed dated 07.04.2017 in
favour of M/s Decathlon Sports India
Private Ltd (the respondent no. 1), letting
out an area of 21,825 Square feet i.e. 2,028
square meters, bearing Unit Nos. GF-01,
GF-02, GF-03, GF-04, GF-05, GF-06, GF07, GF-08, GF-9, GF-9A, GF-9B, GF-10A,
GF-10B, GF-10C at Plot No. TC-G 4/4 in
Rohtas Presidential Arcade situated in
Vibhuti Khand, Gomti Nagar, Lucknow, for
a period of 20 years.

4. The petitioner no. 2, Hina Juneja
had entered into an agreement to purchase
the unit no. GF-03 on 21.05.2013 and an
agreement to sell Unit No. GF-05 of the
Complex was executed in favour of Vijay
Path Traders Link Private Limited on
28.03.2012. Rest of the petitioners claim to
have purchased various units forming part of
the leased premises from M/s Rohtas
Projects Ltd. subsequent to execution of the
lease deed in favour of the respondent no.1

5. The petitioners filed an
Arbitration application No. 48 of 2020
before this Court under Section 11 of the
Arbitration Act stating that they had been
allotted commercial units by M/s Rohtas
Projects Limited. M/s Rohtas Projects
Limited had executed a lease deed in favour
of respondent no. 1 for an area measuring
21825 square feet on 07.04.2017 for a period
of 20 years w.e.f. 16.01.2017. The
petitioners had obtained transfers of various
5 All. Chitra Misra & Ors. Vs. M/S Decathlon Sport India Pvt. Ltd. & Anr.
1253
portions of the leased property between the
years of 2017-2018 from M/s Rohtas
Projects Limited. The petitioners requested
the respondent no. 1 to clear the outstanding
liability of payment of rent under the lease
deed executed by M/s Rohtas Projects
Limited in favour of respondent no. 1 and
upon failure of the respondent no. 1 to clear
the dues, they issued a joint notice dated
25.08.2020 terminating the tenancy of
respondent no. 1 created by the lease deed
dated 07.04.2017 executed by M/s Rohtas
Projects Limited. They requested this Court
to appoint an Arbitrator for adjudication of
the dispute between the parties. Elaborate
submissions were advanced on behalf of the
parties in proceedings under Section 11 of
the Arbitration Act.

6. The learned counsel for the
petitioner had placed reliance on the
decision of Hon'ble Supreme Court in the
case of Mayavati Trading (P) Ltd. versus
Pradyuat Deb Burman, (2019) 8 SCC 714,
wherein the Hon'ble Supreme Court held
that the scope of judicial intervention, as per
under Section 11(6-A) is confined to
examination of the existence of Arbitral
Agreement and is to be understood in the
narrow sense as has been laid down in the
judgment rendered in Duro Felguera, S.A.
versus Gangavaram Port Ltd., (2017) 9
SCC 729, wherein it was held that: -

"in the event the court/judicial
authority is prima facie satisfied against the
argument
challenging
the
arbitration
agreement, it shall appoint the arbitrator
and/or refer the parties to arbitration, as the
case may be. The amendment envisages that
the judicial authority shall not refer the
parties to arbitration only if it finds that
there
does
not
exist
an
arbitration
agreement or that it is null and void. If the
judicial authority is of the opinion that
prima facie the arbitration agreement exists,
then it shall refer the dispute to arbitration,
and leave the existence of the arbitration
agreement to be finally determined by the
Arbitral Tribunal. However, if the judicial
authority concludes that the agreement does
not exist, then the conclusion will be final
and not prima facie. The amendment also
envisages that there shall be a conclusive
determination as to whether the arbitration
agreement is null and void. In the event that
the judicial authority refers the dispute to
arbitration and/or appoints an arbitrator,
under Sections 8 and 11 respectively, such a
decision will be final and non-appealable.
An appeal can be maintained under Section
37 only in the event of refusal to refer parties
to arbitration, or refusal to appoint an
arbitrator."

7. Learned counsel for the
petitioner had also referred to a decision of
the Hon'ble Supreme Court in the case of
Vidya Drolia and Others Vs. Navrang
Studios: (1981) 1 SCC 523, wherein
Hon'ble Supreme Court held as under: -

"Whether Arbitration Agreement
was in writing? or whether Arbitration
agreement was contained in exchange of
letters, telecommunication, etc.? or whether
the Core contractual ingredients qua the
arbitration agreement were fulfilled?, or
whether the subject matter of dispute is
arbitrable."
If the Court prima facie comes to a
conclusion that there is no valid arbitration
agreement then it would not refer the matter
to an Arbitrator but on the other hand, if the
validity of the Arbitration agreement cannot
be determined on a prima facie basis then it
should refer the matter to Arbitration.
"Therefore, the Rule for the Court is "when
in doubt, do refer".
1254 INDIAN LAW REPORTS ALLAHABAD SERIES
8. After recording the submissions
advanced by learned counsel for the parties,
this Court passed an order dated 25.08.2021
in Arbitration Application No. 48 of 2020.
The relevant portion of the order is as under:
-

"(16) In view of the aforesaid, this
Court proposes the name of Justice Anant
Kumar (Retired) Resident of Flat No.703,
Indraprastha Grand, Sector-4 A, Vrindavan
Yojana, Near Kandhai Park, Lucknow,
Mobile No.8004928592 as Sole Arbitrator.
(17) Let the notice in terms of
Section 12 (6) of the Arbitration and
Conciliation Act, 1996, be sent to the newly
proposed Arbitrator for seeking his consent,
list this matter on 16.09.2021."

9. The Arbitrator proposed by the
order dated 25.08.2021 did not give his
consent and, therefore, Hon'ble Justice Shri
Dilip B. Bhosale (retired) was appointed as
the sole Arbitrator by means of an order
dated 06.10.2021.

10. The petitioners filed a statement
of claim before the sole Arbitrator on
26.11.2021.

11. The respondents filed an
application under Section 16(2) of the
Arbitration Act on 28.10.2021 praying for
dismissal of the arbitration proceedings
initiated by the petitioners, as the Arbitral
Tribunal does not have the jurisdiction to
decide the dispute. A further prayer was
made for stay of the proceedings, as per the
moratorium imposed on institution of any
proceeding as per Section 14 of the
Insolvency and Bankruptcy Code, 2016
(hereinafter referred to as 'the IBC').

12. The respondents had inter alia
stated in the application under Section 16(2)
of the Arbitration Act that before execution
of the lease deed dated 07.04.2017 in favour
of the respondent no. 1, the owner of the
premises, M/s Rohtas Projects Limited had
executed two agreements to sell - (i) dated
21.05.2013 in respect of unit GF-03 in
favour of Hina Juneja (petitioner no. 2) and
(ii) dated 28.03.2012 in respect of unit GF05 in favour of M/s Vijay Path Traders Link
Private Limited but no sale deed has been
executed in respect of those units at that
point of time. The respondent no. 1 had
taken the property on lease under a bona fide
belief that the same was free from all
encumbrances and it had made substantial
investments to further develop the property
at its own expenses. The respondent no. 1
has stated that several of the petitioners did
not have registered sale deeds in their
favour. Three of the petitioners had not even
an agreement to sell executed in their favour.
The petitioners had invoked the arbitration
agreement between the Respondent no. 1
and M/s Rohtas Projects Limited without
impleading M/s Rohtas Projects Limited as
a party and they had wrongly impleaded the
respondent no. 1 whereas there was no
arbitration
agreement
between
the
petitioners and the respondent no. 1.

13. The respondent no. 1 further
contended that the proceedings under the
IBC were already pending before the
National Law Company Tribunal, New
Delhi (hereinafter referred to as "the
NCLT"), wherein a moratorium had been
imposed under Section 14 of the IBC,
according to which the proceedings cannot
be initiated against M/s Rohtas Projects Ltd.
in any other court of law. Section 238 of the
IBC Code, 2016 gives an overriding effect
to it or over other statute.

14. The respondent no. 1 also
placed reliance upon the Clause 19 of the
5 All. Chitra Misra & Ors. Vs. M/S Decathlon Sport India Pvt. Ltd. & Anr.
1255
lease agreement, which prohibits creation of
any third party interest in respect of any part
of the leased premises, without consent of
the lessee and without execution of a tripartite agreement regarding attornment of
leasehold
rights.
15. The petitioners filed objections against
the application under Section 16(2) of the
Act refuting the contentions of the
respondents. The petitioners stated that most
of them had sale deeds in their favour and
the parties had acquired rights in respect of
property prior to initiation of insolvency
proceedings. The petitioners contended that
this aspect had already been examined by
this Court while passing the order dated
25.08.2021 under Section 11 of the
Arbitration Act and, therefore, it could not
be raised again.

16. The learned sole Arbitrator
rejected the application under Section 16(2)
of the Arbitration Act by means of impugned
order dated 15.07.2022. It is s recorded in
the order dated 15.07.2022 that the
application under Section 16(2) of the Act
questioning the jurisdiction of the Arbitral
Tribunal has been filed on the following
grounds: -

"(i) The Claimants have invoked the
arbitration clause of the lease deed entered
into between the Respondents and M/S
Rohtas Projects Limited without making
M/S Rohtas Projects Limited a party to the
Arbitration Petition and the same is against
the principles of natural justice.
(ii) Some of the parties do not hold
a registered sale deed in their favour but
they have also been made parties to the
present arbitration proceedings and have
been granted right to be part of the
arbitration proceedings.
(iii) A
moratorium
has
been
imposed by the National Company Law
Tribunal (NCLT) against initiation of any
proceedings in any other court of law or
tribunal and Section 238 of the IBC shall
have overriding effect over all other laws
and the present arbitration proceedings are
barred by section 14(1)(a) of the said Code.
(iv) The Claimants did not exercise
due diligence on the charges on the leased
property despite the fact that they were
aware of the lease deed that existed between
the Respondents and M/S Rohtas Projects
Limited.
(v) In view of the special provisions
of the Uttar Pradesh Regulation of Urban
Premises Tenancy Ordinance 2021, the
arbitration proceeding initiated under the
Act, which is a general law, is not
maintainable in as much as the special law
prevails over the general law of arbitration.
The Claimants should have therefore filed
their petition under the said Ordinance of
2021 and not under the provisions of the
Arbitration and Conciliation Act, 1996."

17. The claimants/petitioners had
opposed the application filed under Section
16(2) of the Act stating that the NCLT had
jurisdiction to adjudicate on the issues
regarding corporate insolvency of the
corporate debtor Rohtas Projects Ltd. Only
and not on any issues involved between the
claimants
and
the
respondents.
The
arbitration proceedings between the parties
were not barred by the provisions of IBC.
The petitioners further submitted that this
High Court has passed the order under
Section 11 of the Arbitration Act after being
satisfied about the existence of an arbitration
agreement between the parties.

18. The Tribunal relied upon the
decisions in the cases of Food Corporation
of India Versus Indian Council of
Arbitration and Others: AIR 2003 SC
3011; Hindustan Petroleum Corporation
1256 INDIAN LAW REPORTS ALLAHABAD SERIES
Limited Versus Pink City Midway
Petroleum: AIR 2003 SC 2881 and Shri
Subh Laxmi Fabrics (P) Limited Versus
Chandmal Barodia and others: AIR 2005
SC 2261, wherein Hon'ble Supreme Court
consistently held that if the question of
jurisdiction of Arbitral Tribunal is raised by
any party, the same has to be decided by the
Arbitral Tribunal itself under Section 16 of
the Act.

19. The Arbitrator held that in view
of the moratorium imposed by the NCLT,
the Arbitral Tribunal has no jurisdiction to
proceed with the matter, therefore, although
the learned counsel for the parties had made
submissions touching rights and liabilities
of the parties, the Arbitral Tribunal cannot
embark upon to make any observation on the
rights and liabilities of the parties as it has
no jurisdiction to proceed with the matter.

20. The petitioners challenged the
aforesaid order by filing an application
under Section 13(1A) of the Commercial
Court Act, 2015 read with Section 37 of the
Arbitration and Conciliation Act, 1996,
which has been rejected by means of an
order dated 30.01.2024 passed by the
Presiding Officer, Commercial Court no. 1,
Lucknow.

21. The Commercial Court held that
although the moratorium imposed by the
NCLT, New Delhi came to an end on
13.12.2021, proceedings were going on
before the NCLT. The Arbitrator has dealt
with
the
objections
of
the
claimants/petitioners and has drawn detailed
conclusion, which do not suffer from any
legal error. The petitioners have already
cancelled the lease deed granted by the
lessor M/s Rohtas Projects Limited in favour
of the respondents and the respondents have
vacated the property in dispute and they
have deposited the entire arrears of rent
before the NCLT. In view of the aforesaid
facts, the Commercial Court found that there
was no ground to interfere in the impugned
order dated 15.07.2022 passed by the
Arbitral Tribunal and it dismissed the
appeal.

22. While assailing the validity of
both the aforesaid orders passed by the
Arbitral Tribunal as well as the order passed
by the Commercial Court no. 1, Lucknow,
Sri Pritish Kumar, the learned counsel for
the petitioners has submitted that the learned
Arbitrator has wrongly recorded in the
impugned order dated 15.07.2022 that "it is
not in dispute that during pendency of the
arbitration proceedings before this Arbitral
Tribunal,
the
NCLT
has
imposed
moratorium against the proceedings any
other Forum in respect of the subject matter
of the present arbitration proceedings",
whereas the correct position is that the
moratorium had been imposed by means of
an order dated 30.09.2019 passed by the
NCLT in C.P. No. IB-1022/(ND)/2018,
whereas
the
arbitration
proceedings
commenced in the year, 2021. Learned
counsel submitted that moratorium seized to
have affect w.e.f. 13.12.2021, as per an order
passed by the NCLT on the aforesaid date.

23. Sri Pritish Kumar has further
submitted that the respondents had merely
prayed in the application under Section
16(2) for stay of the proceedings, as per
moratorium imposed on the institution of
any proceedings as per Section 14 of the
IBC, and the learned Arbitral Tribunal has
committed an error in dropping the
proceedings, instead of staying the same till
lifting of the moratorium. Moreover, as the
moratorium has already seized to be in force
with effect from 13.12.2021 i.e. prior to
passing of the order dated 15.07.2022, the
5 All. Chitra Misra & Ors. Vs. M/S Decathlon Sport India Pvt. Ltd. & Anr.
1257
learned Arbitrator was not justified in
dropping the proceedings on the ground of
the moratorium.

24. The learned counsel for the
petitioners has also submitted that the
petitioners being transferees of the lessor,
possess the rights of lessor, as per the
provision contained under Section 109 of
the Transfer of Property Act. In support of
his contention, he has placed reliance on a
judgment of the Hon'ble Supreme Court in
the case of Ambica Prasad Vs. Alam and
others: (2015) 13 SCC 13, wherein it was
held that it is well settled "that a transferee
of the landlord's rights steps into the shoes
of the landlord with all the rights and
liabilities of the transferrer landlord in
respect of the subsisting tenancy". As per
Sri. Pritish Kumar, this Section does not
require that the transfer of the right of the
landlord can take effect only if the tenant
attorns to him and attornment is not
necessary to confer validity to the transfer of
the landlord's rights.

25. Per contra, Sri S. C. Mishra
Senior
Advocate
appearing
for
the
respondents has submitted that the lease
deed dated 07.04.2017 executed by M/s
Rohtas Projects Limited in favour of the
respondent no. 1 mentions that the "Lessor"
which expression shall, unless it be
repugnant to the context or the meaning
thereof, means and includes its successors
and permitted assigns. Upon transfer of its
rights by the lessor without permission of
the lessee, the lessee was entitled to hold the
monthly rentals of the lessor till execution of
proper
legal
documentation/deed
of
attornment amongst the lessor, the lessee
and the buyer, which was never done. The
lease deed further categorically stated that
the lessor had executed an agreement to sell
Unit nos. GF-03 and GF-05 forming a part
of the lease premises but neither the sale
deeds had been executed nor had physical
possession been handed over to the
prospective buyer. The lessor undertook the
responsibility of execution of attornment
deed/supplementary deed with the buyers of
the units before execution and registration of
sale deeds in that regard.

26. Sri Mishra further submitted
that the Resolution Professional, had
submitted an application to NCLT, a copy
whereof has been annexed by the petitioners
themselves (at page no. 213 to 233 of the
petition) stating that the members of the
suspended Board of Directors of M/s Rohtas
Projects Limited had executed sale deeds of
various units to respondent nos. 5 to 15 in
that application (including several of the
petitioners),
without
obtaining
'No
Objection Certificates' from the IDFC
Limited and Allahabad Bank (now Indian
Bank),
with
whom
the
units
were
mortgaged. The Resolution Professional
requested for a declaration that the
transactions of sale in respect of mortgaged
property without seeking 'No Objection
Certificates' from the secured creditors, is
null and void and the effect of the said
transfers be reversed.

27. The learned counsel for the
petitioners has drawn attention of the Court
to the statement of the Claim filed by the
petitioners before the sole Arbitrator,
wherein they have claimed arrears of rent,
interest on arrears of rent, damages for use
and occupation of property at the rate of
rent, interest on damages, eviction of the
respondent no. 1 from the demise premises
and cost of the proceedings. He submitted
that the respondents have already deposited
the entire amount, payable in the NCLT and
they have already vacated the premises,
which contentions are not disputed by the
1258 INDIAN LAW REPORTS ALLAHABAD SERIES
learned Counsel for the petitioners. The
respondents having already performed their
part for redressal of the grievances raised by
the petitioners through the Claim Petition,
they are not liable to do anything else for
satisfying the claims of the petitioners and,
in these circumstances, it would not be in the
interest of justice that the respondents are
made to face the arbitration proceedings.

28. Sri Mishra has further submitted
that it is not that the respondents had only
prayed for stay of proceedings through their
application under Section 16(2) of the
Arbitration Act. The prayers made in the
application under Section 16 are as follows:
-

"Prayer:-
In
the
premises,
it
is
most
respectfully prayed that the learned sole
Arbitrator may graciously be pleased to: -
(a) dismiss the arbitration initiated
by the petitioners as the Hon'ble Arbitral
Tribunal does not have jurisdiction to try the
matter, and/or;
(b) stay the proceedings as per the
moratorium imposed on the institution of
any proceedings as per Section 14 of IBC;
and/or;
(c) pass any other order as learned
Sole Arbitrator may deem fit.

29. The existence of an arbitration
agreement between the parties is the
prerequisite
for
initiating
arbitration
proceedings. Arbitration
agreement
is
defined in Section 7 of the Arbitration and
Conciliation Act, 1996 as follows: -

" 7. Arbitration agreement.-(1) In
this Part, "arbitration agreement" means
an agreement by the parties to submit to
arbitration all or certain disputes which
have arisen or which may arise between
them in respect of a defined legal
relationship, whether contractual or not.
(2) An arbitration agreement may be
in the form of an arbitration clause in a
contract or in the form of a separate
agreement.
(3) An arbitration agreement shall
be in writing.
(4) An arbitration agreement is in
writing if it is contained in-
(a) a document signed by the
parties;
(b) an exchange of letters, telex,
telegrams
or
other
means
of
telecommunication including
communication through electronic means
which provide a record of the agreement; or
(c) an exchange of statements of
claim and defence in which the existence of
the agreement is alleged by one party and
not denied by the other.
(5) The reference in a contract to a
document containing an arbitration clause
constitutes an arbitration agreement if the
contract is in writing and the reference is
such as to make that arbitration clause part
of the contract."

30. There is no arbitration
agreement between the parties, i.e the
petitioners
and
the
respondents.
An
arbitration Clause is contained in Clause 23
of the lease deed dated 07.04.2017 executed
by the M/s Rohtas Projects Limited in
favour of M/s Decathlon Sports India
Private Ltd. (respondent no. 1), which
provides as follows: -

"The parties agree that they shall
attempt to resolve to good faith and
consultation any dispute or difference
between any of the parties in respect of or
concerning
or
connected
with
the
interpretation or implementation of this
lease deed or arising out of this lease deed.
5 All. Chitra Misra & Ors. Vs. M/S Decathlon Sport India Pvt. Ltd. & Anr.
1259
In the event of dispute or difference between
the parties not getting resolved, such dispute
or difference shall be referred to the
Arbitration under the provisions of the
Arbitration and Conciliation Act, 1996 or
any statutory modification or amendment
thereof, by an arbitration Penal comprising
of three Arbitrators. The Arbitration Penal
shall
comprise
one
Arbitrator
each
appointed by the lessor and the lessee and
such Arbitrators shall appoint the third
Arbitrator."

31. The expression 'parties' used in
the above quoted Clause 23 refers to the
parties to the lease deed, which was
executed between: -

"ROHTAS PROJECTS LIMITED, a
company incorporated and validly existing
under the provisions of Indian Companies
Act, 1956 with its corporate office at 27/18,
Raja Ram Mohan Roy Marg (one way Road)
Lucknow - 226001) acting through its
authorized signatory, Mr. Pankaj Rastogi
duly authorized vide board resolution dated
6th march 2017 (hereinafter referred to as
the "Lessor" which expression shall, unless
it be repugnant to the context or the meaning
thereof, mean and include its Successors
and permitted assigns), being Party of the
FIRST PART.

AND
DECATHLON
SPORTS
INDIA
PRIVATE
LIMITED,
a
complay
incorporated and validly existing under the
provisions of the Indian Companies Act,
2956 (a wholly owned subsidiary of
Decathlon S. A., France) with its registered
office at Survey number 78/10, A2 0 -
Chikkajala Village, Bellary road, Bangalore
- 562 157, ("hereinafter referred to as "the
Lessee" which expression shall, unless it be
repugnant to the context or the meaning
thereof, mean and include its Successors
and permitted assigns), acting through _ _
_, being Party of the SECOND PART"
The lease deed further states that: -
"The Lessor is the absolute legal
owner of all that piece of immovable
property
bearing
No.
TC-G
4/4,
admeasuring 5000 square meters situated at
Vibhuti Khand, Gomti Nagar, Lucknow,
Uttar
Pradesh
which
is
currently
categorized as commercial use. The said
property is hereinafter referred to as the
Total Property and is more fully described in
the Schedule written hereunder and is
depicted in ANNEXURE A.
AND WHEREAS, the Lessor is into
the business of developing commercial and
residential projects and has constructed and
developed a commercial complex under the
name and style of 'Rohtas Presidential
Arcade', which has been operational since
2015 and is spread over 5000 square meters
(Hereinafter
referred
to
as
the
Complex/Total Property) consisting of retail
shops, stores, banks, offices etc. and
basements for parking (plans of the
Complex annexed herewith as ANNEXURE
A) after obtaining all required approvals
and sanctions in accordance with the
building plans approved by the competent
authority (ies). The Lessor has sold few units
in
the
said
Complex
to
various
parties/individuals by virtue of Agreement to
sale. Out of the Total property, the Ground
Floor measuring 21825 square feet (i.e.
2028 square meters) of covered area
bearing Unit Nos. GF-01, GF-02, GF-03,
GF-04, GF-05, GF-06, GF-07, GF-08, GF09, GF-09A, GF-09B, GF-10A, GF-10B
and GF-10C at Plot No. TC-G 4/4,
admeasuring 2028 square meters situated
at Vibhuti Khand, Gomti Nagar, Lucknow,
Uttar Pradesh for retail space is available
for lease and is owned/possessed by the
Lessor, Though the Lessor has further
1260 INDIAN LAW REPORTS ALLAHABAD SERIES
presented to the Lessee that they have
executed an Agreement to Sell dated
21.05.2013 for the Unit bearing Nos. GF03 in the name of Mrs. Heena Juneja &
Agreement to Sell dated 28.03.2012 for the
Unit No. GF-05 of the Complex in favour
of Vijay Path Traders Link Private Limited,
but no conclusive sale has taken place for
these two units. The Lessor have further
represented that as on date all the legal
rights, interests and possession of the said
two units stands in the name of the Lessor
for all the purposes and the Lessor have
obtained two separate registered Power of
Attorneys from Mrs. Heena Juneja & Vijay
Path
Traders
Link
Private
Limited
respectively authorizing the Lessor to
enter/deal/lease/execute on their behalf
such business transactions as the Lessor
may deem fit, after amalgamating their
Units with the other Units of the Complex on
the terms and conditions as the Lessor may
deem fit. The Copies of the said registered
Power of Attorneys for Unit No. GF-03 and
GF-05 are annexed hereto as ANNEXURE
B1 & B2."
* * *
"4. RENT, ESCALATION & RENT
COMMENCEMENT DATE
4.1 The Parties agree that in
consideration of the grant of Lease and the
continued right to enjoy and possess and use
the Leased Premises during the Lease Term,
the Lessee shall pay to the Lessor, the
monthly rent as detailed in ANNEXURE-1
("Monthly
Rent")
from
the
Rent
Commencement Date. It is understood
between the parties that the monthly rent is
all inclusive of any/all kind of CAM charges
during the tenure of this Lease.
4.2 The Lessee shall deposit the
amount of monthly rentals, during the tenure
of this lease and the security deposit in the
bank account numbers to be provided by the
Lessor to the Lessee, subject to Tax
Deduction at Source.
* * *"
8. OBLIGATIONS ON PART OF
THE LESSOR
* * *
8.3 In case the Lessor creates any
lien after the execution hereof, that should
be done with prior intimation to the Lessee.
However, any charge or transfer of the
Leased Premises to any third party during
the subsistence of the lease can be created
only in terms of Clause 19".
* * *
19.SALE, RIGHT OF FIRST
REFUSAL & ATTORNMENT CLAUSE
19.1 In the event of proposed sale
or transfer of its rights in any of the unit of
the Leased Premises (either partially or
whole), the Lessor shall first intimate the
Lessee in writing to ascertain the interest of
the Lessee to purchase the aforesaid
premises and the Lessee shall revert on their
interest in the aforesaid premises within 15
days of receiving such intimation. If the
Lessee does not reply within 15 days, then
the Lessor shall assume that the Lessee is
not interested in the aforesaid space and the
Lessor will be free to offer to any third party
and the Right of First Refusal shall expire
for the Lessee.
19.2 In case the Lessor doesn't
comply with the above-said condition
pertaining to the proposed sale or transfer
of its rights of the Leased Premises, and
does not intimate the Lessee then in such
event the Lessee shall be entitled to hold the
monthly rentals of the Lessor till proper
legal documentation/Deed of Attornment is
being executed between the Lessor, Lessee
and such prospective buyer on the same
terms and conditions of this Deed.
19.3 The Lessor hereby, Irrevocably
agrees and undertakes to ensure the
business continuity of the Lessee in the
5 All. Chitra Misra & Ors. Vs. M/S Decathlon Sport India Pvt. Ltd. & Anr.
1261
Leased Premises for the entire tenure of the
Lease (on the same terms and conditions) in
case of sale or transfer of ownership rights
by any manner whatsoever. In case of sale
of the Leased Premises (either in part of
full), the Lessor agrees to ensure the
business continuity of the Lessee by
executing Deed of Attornment between the
Lessor, Lessee and such prospective buyer
on the same terms and conditions of this
Lease Deed before concluding the sale
deed with such prospective buyer.
19.4 The Lessor agreed that in case
of sale of any unit of the Leased Premises,
the Lessor shall immediately inform the
Lessee before making an endorsement on
such sale or transfer and all such
sale/transfer shall be subject to execution
of Attornment Deed between the Lessor,
Lessee and such prospective buyer.
19.5 The Lessee shall have the first
right of refusal at the end of Lease Term for
further renewal of Lease Term as per the
mutually agreed terms and conditions.
19.6 It is well understood between
the parties that the Lessor have already
executed Agreement to Sell for the Unit No.
GF-03 and GF-0S forming part of the
Leased
Premises,
but
neither
the
conclusive sale have been executed nor any
physical possession of the same have been
delivered. The Lessor have represented that
such sale shall not at all any circumstance
whatsoever shall disturb the peaceful
possession and business operations of the
Lessee in the Leased Premises. The Lessor
shall ensure and takes responsibility to
execute
an
Attornment
Deed/Supplementary deed with the buyers
of such units before concluding and
registering a conclusive Sale Deed in that
regard.
19.7 The Lessor has unconditionally
agrees that they will not sell the Leased
Premises (either partially or fully) to any
third party for the initial 06 months of Lease
commencing from the handover of the
Leased Premises to the Lessee.

32. Section 109 of the Transfer of
the Property Act, 1982 relied upon by the
petitioners reads as follows: -

"109. Rights of lessor's transferee.-
If the lessor transfers the property leased, or
any part thereof, or any part of his interest
therein, the transferee, in the absence of a
contract to the contrary, shall possess all
the rights, and, if the lessee so elects, be
subject to all the liabilities of the lessor as
to the property or part transferred so long as
he is the owner of it; but the lessor shall not,
by reason only of such transfer cease to be
subject to any of the liabilities imposed
upon him by the lease, unless the lessee
elects to treat the transferee as the person
liable to him:
Provided that the transferee is not
entitled to arrears of rent due before the
transfer, and that, if the lessee, not having
reason to believe that such transfer has been
made, pays rent to the lessor, the lessee shall
not be liable to pay such rent over again to
the transferee. The lessor, the transferee and
the lessee may determine what proportion of
the premium or rent reserved by the lease is
payable in respect of the part so transferred,
and,
in
case
they
disagree,
such
determination may be made by any Court
having jurisdiction to entertain a suit for the
possession of the property leased."

33. Section 109 provides that if the
lessor transfers the property leased, in the
absence of a contract to the contrary, the
transferee shall possess all the rights of the
lessor and, if the lessee so elects, the
transferee shall be subject to the liabilities of
the lessor as to the property or part
transferred. In the present case, there was a
1262 INDIAN LAW REPORTS ALLAHABAD SERIES
contract to the contrary contained in the
lease deed itself prohibiting transfer of any
part of the leased property without prior
permission
of
the
lessee.
In
these
circumstances, the rights of the lessor shall
not stand transferred to the petitioners by
virtue of Section 109 of the Transfer of
Property Act. Further, Section 109 makes
the transferees subject to all the liabilities of
the lessor as to the property transferred, at
the option of the lessee. Here the lessee has
not exercised this option. Rather the lessee
has objected to the transfer made in favour
of the petitioners in violation of the
conditions contained in the lease deed.

34. In Ambica Prasad v. Mohd.
Alam, (2015) 13 SCC 13 relied upon by the
learned Counsel for the petitioners, the
question involved was whether the a person
having purchased a property which had been
let out and was subject to the provisions of
the Assam Urban Areas Rent Control Act,
1972, would become a landlord. The
expression "landlord" has been defined in
Section 2(c) of the Assam Urban Areas Rent
Control Act, 1972 which reads as under:

"2.
(c) 'Landlord'
means
any
person who is, for the time being receiving
or entitled to receive rent in respect of any
house whether on his own account, or on
account, or on behalf, or for the benefit of
any other person, or as a trustee, guardian
or receiver for any other person and
includes in respect of his sub-tenant, a
tenant who has sub-let any house and
includes every person not being a tenant
who from time to time derives title under a
landlord."

The Hon'ble Supreme Court held
that the definition of "landlord" is couched
in a very wide language, according to which
not only the owner but also any person
receiving rent, whether on his own account
or on behalf of or for the benefit of any other
person or as a trustee, guardian, or receiver
for any other person, is also the landlord.
However, for the purpose of eviction of a
tenant on the ground of personal need or
reasonable requirement, one must show that
he is the owner of the building.

35.