Mukta Gupta, J
1. By this petition under Section 11(6) of the Arbitration and Conciliation Act, 1996 (in short, the Act), the petitioner seeks appointment of a Sole
Arbitrator in terms of Clause 17 of the Lease Agreement dated 14th August 2018 and the MoU dated 21st July 2016, in respect of the disputes which
arise between the parties.
2. According to the petitioner, it is a premier cinema exhibition company and runs 845 cinema screens. In the course of its business, the petitioner
enters into arrangements with the owners/licensors of such cinema plots/malls to run cinemas. According to the petitioner, the respondent was
constructing a retail cum shopping complex/mall and entertainment centre i.e. ‘Spaze 92 Mall’ at Sector 92, Dwarka Expresseway, Gurgaon
and thus, the petitioner and the respondent entered into an agreement to lease dated 14th August 2018 being the underlying agreement between the
parties wherein the parties inter alia agreed on a mechanism and pre-conditions for handover of the premises. It was further agreed that the parties
would maintain confidentiality of the terms and information contained in the agreement. Prior to the agreement to lease, a MoU dated 21st July
2016 and an addendum to the MoU dated 28th December 2017 were entered into between the parties. Clauses 17 and 18 of the agreement to
lease read as under:-
“17 ARBITRATION:
17.1 In the event of any dispute, controversy or claim arising out of or in connection with this Agreement / Lease Deed, including any
questions regarding its existence, validity, construction and/or interpretation or termination (hereinafter referred to as the ""Dispute"") will
be resolved through joint discussions between the concerned Parties. Any Dispute not resolved through joint discussions, within 30 (Thirty)
days of its having arisen shall be referred to be resolved to a sole arbitrator appointed mutually in accordance with the Indian Arbitration
and Conciliation Act 1996 including any amendment therein and the rules prescribed thereunder (the ""Act""). This Agreement / Lease Deed
and the rights and obligations of the Parties hereunder shall retain in full force and effect pending the award in such arbitration
proceedings, which award shall determine whether and when termination of this Agreement/ Lease Deed, if relevant, shall become effective.
The award of the arbitrator shall be final and binding upon the Parties.
17.2 The seat of the arbitration shall be at New Delhi, India and the language of the arbitration shall be English.
18 GOVERNING LAW & JURISDICTION:
This Agreement/ Lease Deed shall be governed by, and construed in accordance with, the laws of India as in effect from time to time. The
courts at Gurgaon shall have jurisdiction to entertain any dispute arising out of or in connection with this Agreement/Lease Deedâ€.
3. According to the petitioner, despite negotiations in several meetings and correspondence between the parties, the premises was not ready for
handover in terms of the agreement to lease. Further, the respondent also breached the confidentiality of the agreement to lease by leveraging the
petitioner’s brand and goodwill, to invite investors and tenants, without any written permission of the petitioner. In view of the disputes arising
between the parties, the petitioner issued a termination notice dated 21st May 2021 to the respondent terminating the agreement to lease dated 14th
August 2018 and subsequently, issued notice invoking arbitration dated 19th July 2021.
 4. In response to the notice invoking arbitration, the respondent vide its reply dated 23rd July 2021 stated that after the execution of the agreement,
the respondent had incurred substantial expenditure in undertaking the completion of various works/obligations as per the agreement to lease and the
petitioner was requested to schedule its activities in the Mall accordingly and that nothing prevented the petitioner from taking possession of the
property, however, instead of taking possession of the property, the petitioner is raising the disputes.Â
5. During the course of arguments, learned counsel for the respondent states that though the agreement to lease dated 14th August 2018 provided for
settlement of disputes through arbitration, however, the MoU and the Addendum to the MoU provided no arbitration agreement and hence, the
disputes cannot be referred to arbitration.Â
6. As noted above, the petitioner is seeking reference to arbitration in terms of the lease agreement dated 14th August 2018 which provides for an
arbitration clause. The petitioner and the respondent were parties to the same. The disputes between the parties as to whether the petitioner failed
to take possession of the property or there was delay in works and whether the petitioner is entitled to recovery of claims are issues arising out of
agreement to lease dated 14th August, 2018 which are required to be dealt with in arbitration. The seat of the arbitration is at New Delhi and hence,
this Court has jurisdiction to entertain the present petition. Â
6. Consequently, Justice P.K.Bhasin, a former Judge of this Court is requested to arbitrate the disputes arising between the parties.Â
7. The learned Arbitrator would be entitled to charge fees as per the Schedule IV of the Act or as agreed by the learned Arbitrator with the consent
of the learned counsels for the parties.Â
8. The learned Arbitrator will furnish the requisite disclosure under Section 12(2) of the Act within one week of entering the reference.Â
9. The right of the respondent to file counter-claim and objections before the learned Arbitrator in accordance with law is reserved.
10. Petition is disposed of.
11. Order be uploaded on the website of this Court.
