RANJIT KUMAR BOSE & ANR.versusANANNYA CHOWDHURY & ANR

                    [2014] 3 S.C.R. 645


              RANJIT KUMAR BOSE & ANR.                          A
                             v.
             ANANNYA CHOWDHURY & ANR.
              (Civil Appeal No. 3334 of 2014)

                     MARCH 07, 2014
                                                                B
     [A.K. PATNAIK AND V. GOPALA GOWDA, JJ.)

    WEST BENGAL PREMISES TENANCY ACT 1997:

     s.6 - Suit for eviction under Tenancy Act - Application by c
defendant to refer the dispute to arbitration as per agreement
- Dismissed by trial court, but allowed by High Court - Held.
In view of sub-s.(3) of s.2 of 1996 Act, arbitration agreement
between landlord and tenant has to give way to s. 6 of
Tenancy Act which confers exclusive jurisdiction on Civil 0
Judge, to decide a dispute between landlord and tenant with
regard to recovery of possession of tenanted premises in a
suit filed by landlord - Impugned judgment of High Court set
aside and matter remanded to trial court to deal with the suit
in accordance with law -- Arbitration and Conciliation Act, 1996 E
- ss.2(3) and 8.

     T.he appellants had inducted the respondents as
tenants in respect of the suit property, i-:-e. a shop room,
on a monthly rent, in terms of an unregistered tenancy
agreement which was notarized on 10.11.2003. On F
06.03.2008, the appellants served a notice· on the
respondents terminating the tenancy and asking them to
vacate the shop premises. The appellants subsequently
filed a suit in the Court of the Civil Judge (Senior
Division), against the respondents for eviction, arrears of G
rent, arrears of municipal tax, mesne profit and for
permanent injunction. In the suit, the respondents filed a
petition u/s 8 of the Arbitration and Conciliation Act, 1996
('the 1996 Act') stating that the tenancy agreement
                             645                             H
    646      SUPREME COURT REPORTS             [2014] 3 S.C.R.


A   contained an arbitration agreement, and prayed that all
    the disputes in the suit be referred to the arbitrator. By
    order dated 10.06.2009, the Civil Judge dismissed the
    petition. The respondents filed a petition under Art. 227
    of the Constitution of India before the High Court, which
B   referred the disputes to the arbitrators to be appointed
    by the parties.
          Allowing the appeal, the Court
         HELD: 1.1 Section 6 of the West Bengal Premises
c   Tenancy Act 1997 lays down that 'notwithstanding
    anything to the contrary contained in any contract', no
    order or decree for recovery of possession of any
    premises shall be made by the Civil Judge having
    jurisdiction in favour of the landlord against the tenant,
    'except on a suit being instituted by such landlord' on
0
    one or more grounds mentioned therein. It is, thus, clear
    that s. 6 overrides a contract between the landlord and
    the tenant and provides that only the Civil Judge having
    jurisdiction can order or decree for recovery of
    possession in a suit to be filed by the landlord. [para 6]
E   [652-A-C]
       1.2 In the instant case, there is an arbitration
  agreement in clause 15 of the tenancy agreement, which
  provides that any dispute regarding the contents or
F construction of the tenancy agreement or dispute arising
  out of the tenancy agreement shall be settled by
  arbitration in accordance with the provisions of the
  Arbitration and Conciliation Act, 1996. But the words
  'notwithstanding anything in any contract' in s. 6 of the
  Tenancy Act, will override the arbitration agreement in
G clause 15 of the tenancy agreement where a suit for
  recovery of possession of any premises has been filed
  by a landlord against the tenant. Such a suit flied by the
  landlord against the tenant for recovery of possession,
  therefore, cannot be referred u/s 8 of the 1996 Act to
H arbitration. [para 8] [653-A-C]
    RANJIT KUMAR BOSE & ANR. v. ANANNYA            - 647
             CHOWDHURY & ANR.
     1.3 Sub-s. (3) of s. 2 of the 1996 Act expressly A
provides that Part-I, which relates to 'arbitration' where the
place of arbitration is in India, shall not affect any other
law for the time being in force by virtue of which certain
disputes may not be submitted to arbitration. Section 6
of the Tenancy Act is one such law which clearly bars B
arbitration in a dispute relating to recovery of possession
of premises by the landlord from the tenant. Since the suit
filed by the appellants was for eviction, it was a suit for
recovery of possession and could not be referred to
arbitration because of a statutory provision in s. 6 of the c
Tenancy Act. The arbitration agreement between the
landlord and the tenant has to give way to s. 6 of the
Tenancy Act which confers exclusive jurisdiction on the
Civil Judge, to decide a dispute between the landlord and
the tenant with regard to recovery of possession of the D
tenanted premises in a suit filed by the landlord. [para 8-
9] [653-C-E; 654-E-F]
     Natraj Studios (P) Ltd. v. Navrang Studios & Anr. 1981
             =
(2) SCR 466 (1981) 1 sec 523 - relied on.
                                                              E
     Booz Allen and Hamilton Inc. v. SB/ Home Finance
Limited & Ors. 2011 (7) SCR 310     =  (2011) 5 sec 532;
Hindustan Petroleum Corporation Ltd. v. Pinkcity Midway
Petroleums (2003) 6 sec 503; Agri Gold Exims Ltd. v. Sri
Lakshmi Knits & Wovens & Ors. 2007 (1) SCR 1161 = (2007)
3 SCC 686; Branch Manager, Magma Leasing & Finance
Limited & Anr. v. Potluri Madhavilata & Anr. 2009 (14) SCR
815 = (2009) 10 sec 103- distinguished.
     1.4 The relief claimed by the appellants being mainly G
for eviction, it could only be granted by the "Civil Judge
having jurisdiction" in a suit filed by the landlord as
provided in s. 6 of the Tenancy Act. The expression "Civil
Judge having jurisdiction" will obviously mean the Civil
Judge who has jurisdiction to grant the other reliefs:
decree for arrears of rent, decree for recovery of arrears H
    648      SUPREME COURT REPORTS                [2014) 3 S.C.R.

A   of proportionate and enhanced municipal taxes, a decree
    for mesne profits and a decree for permanent injunction
    claimed in the suit. The impugned judgment of the High
    Court is set aside and the matter is remanded to the Civil
    Judge, Senior Division, who will proceed with the suit in
B   accordance with law. [para 14-15] [657-A-D]

                         Case Law Reference:
          2003 (6) sec so3        distinguished         para 3
          2007 (1) SCR 1161       distinguished         para 3
c         2009 (14) SCR 815       distinguished         para 3
          1981 (2) SCR 466        relied on             para 4
          2011 (7) SCR 310        referred to           para 4
      CIVIL APPELLATE JURISDICTION : Civil Appeal No.
D 3334 of 2014.

        From the Judgment and Order dated 16.04.2010 of the
    High Court of Calcutta in Co. No. 2440 of 2009.

E        Parthapratim Chaudhuri, Amarendra Bal, Aditya Sharma,
    K.S. Rana for the Appellants.

         Rana Mukherjee, Kasturika Kaumudi, Daisy Hannah (for
    Victor Moses & Associates) for the Respondents.

F         The Judgment of the Court was delivered by

          A.K. PATNAIK, J. 1. Leave granted.

    Facts of the Case

G      2. The appellants have inducted the respondents as
  tenants in respect of a shop room measuring 600 sq. feet at
  HA-3, Sector-3, Salt Lake City, Kolkata, and paying a monthly
  rent to the appellants. In respect of the tenancy, the appellants
  and the respondents have executed an unregistered tenancy
H agreement which has been notarized on 10.11.2003. On
     RANJIT KUMAR BOSE & ANR. v ANANNYA                     649
      CHOWDHURY & ANR. [AK. PATNAIK, J.]
06.03.2008, the appellants, through their Advocates. served a       A
notice on the respondents terminating the tenancy and asking
them to vacate the shop premises and the notice stated that
after April, 2008 the relationship of landlord and tenant
between the appellants and the respondents shall cease to
exist and the respondents will be deemed to be trespassers          B
liable to pay damages at the rate of·Rs.500/- per day for
wrongful occupation of the shop. The respondents, however,
did not vacate the shop premises and the appellants filed Title
Suit No.89 of 2008 against the respondents for eviction,
arrears of rent, arrears of municipal tax, mesne profit and for     c
permanent injunction in the Court of the Civil Judge (Senior
Division), 2nd Court at Barasat, District North 24-Parganas in
the State of West Bengal. In the suit, the respondents filed a
petition under Section 8 of the Arbitration and Conciliation Act,
1996 (for short 'the 1996 Act') stating therein that the tenancy    D
agreement contains an arbitration agreement in clause 15 and
praying that all the disputes in the suit be referred to the
arbitrator. By order dated 10.06.2009, the learned Civil Judge
dismissed the petition under Section 8 of the 1996 Act and
posted the matter to 10.07.2009 for filing of written statement     E
by the defendants (respondents herein).

     3. Aggrieved, the respondents filed an application (C.O.
No.2440 of 2009) under Article 227 of the Constitution of India
before t~e Calcutta High Court and contended that the tenancy
agreement contains an arbitration agreement in Clause 15,           F
which provides that any dispute regarding the contents or
construction of the agreement or dispute arising out of the
agreement shall be settled by Joint Arbitration of two
arbitrators, one to be appointed by the landlords and the other
to be appointed by the tenants and the decision of the              G
arbitrators or umpires appointed by them shall be final and that
the arbitration will be in accordance with the 1996 Act and,
therefore, the learned Civil Judge rejected the petition of the
respondents to refer the disputes to arbitration contrary to the
mandate in Section 8 of the 1996 Act. The appellants opposed        H
    650     SUPREME COURT REPORTS                 [2014] 3 S.C.R.


A the application under Article 227 of the Constitution of India
   contending inter alia that the dispute between the appellants
   and the respondents, who are landlords and tenants
   respectively, can only be decided by a Civil Judge in
   accordance with the provisions of the West Bengal Premises
B Tenancy Act, 1997 (for short 'the Tenancy Act'). By the
  impugned judgment dated 16.04.2010, the High Court has held
  that in view of the decisions of this Court in Hindustan
  Petroleum Corporation Ltd. v. Pinkcity Midway Petroleums
  [(2003) 6 SCC 503], Agri Gold Exims Ltd. v. Sri Lakshmi Knits
C & Wovens & Ors. [(2007) 3 SCC 686] and Branch Manager,
  Magma Leasing & Finance Limited & Anr. v. Potluri
  Madhavilata & Anr. [(2009) 10 SCC 103], the Co_µ rt has no
  other alternative but to refer the disputes to the arbitrators to
  be appointed by the parties as per the arbitration agreement.
  The High Court, however, has observed in the impugned
0
  judgment that if any dispute is raised regarding arbitrability of
  such dispute before the arbitral tribunal, such dispute will be
  decided by the arbitral tribunal.

    Contentions of the learned counsel for the parties
E
       4. Learned counsel for the appellants submitted that in
  Hindustan Petroleum Corporation Ltd. v. Pinkcity Midway
  Petroleums, Agri Gold Exims Ltd. v. Sri Lakshmi Knits &
  Wovens & Ors. and Branch Manager, Magma Leasing &
F Finance Limited & Anr. v. Potluri Madhavilata & Anr. (supra),
  this Court has not decided as to whether the dispute between
  the landlord and the tenant could be decided by the arbitrator
  in accordance with the arbitration agreement between the
  landlord and the tenant and the provisions of the 1996 Act or
G by the appropriate forum in accordance with the law relating to
  tenancy. He cited the decision of this Court in Natraj Studios
  (P) Ltd. v. Navrang Studios & Anr. [(1981) 1 SCC 523],
  wherein it has been held that Court of Small Causes alone and
  not the arbitrator as a matter of public policy has been
H empowered to decide disputes between the landlord and the
     RANJIT KUMAR BOSE & ANR. v. ANANNYA                      651
      CHOWDHURY & ANR. [A.K. PATNAIK, J.]
tenant under the Bombay Rent Act. He also relied on the              A
observations of this Court in Booz Allen and Hamilton Inc. v.
SB/ Home Finance Limited & Ors. ((2011) 5 SCC 532] in para
36 at page 54 7 that eviction or tenancy matters governed by a
special statute where the tenant enjoys statutory protection
against eviction can be decided by specified courts conferred        B
with the jurisdiction to grant eviction and such disputes are non-
arbitrable.

     5. Learned counsel for the respondents, on the other hand,
relied on the decisions of this Court in Hindustan Petroleum
Corporation Ltd. v. Pinkcity Midway Petroleums, Agri Gold            C
Exims Ltd. v. Sri Lakshmi Knits & Wovens & Ors. and Branch
Manager, Magma Leasing & Finance Limited & Anr. v.
Potluri Madhavilata & Anr. (supra) to support the impugned
judgment. He submitted that there can be no doubt that the
Tenancy Act will determine the rights of the landlord and the        D
tenant in this case, but when there is an arbitration agreement
between a landlord and a tenant, instead of the Civil Judge, the
arbitrator will decide the disputes between the landlord and the
tenant by applying the provisions of the Tenancy Act.
                                                                     E
Findings of the Court

    6. The relevant portion of Section 6 of the Tenancy Act
1997 is quoted hereinbelow:

     "6. Protection of tenant against eviction.-(1)                  F
     Notwithstanding anything to the contrary contained in any
     other law for the time being in force or in any contract, no
     order or decree for the recovery of the possession of any
     premises shall be made by the Civil Judge having
     jurisdiction in favour of the landlord against the tenant,      G
     except on a suit being instituted by such landlord on one
     or more of the following grounds:-
                                                          "
                                                                     H
    652       SUPREME COURT REPORTS                   [2014] 3 S.C.R.

A It will be clear from the language of Section 6 of the Tenancy
  Act 1997 quoted above that 'notwithstanding anything to the
  contrary contained in any contract', no order or decree for
  recovery of possession of any premises shall be made by the
  Civil Judge having jurisdiction in favour of the landlord against
8 the tenant, 'except on a suit being instituted by such landlord'
  on one or more grounds mentioned therein. It is, thus, clear that
  Section 6 of the Tenancy Act overrides a contract between the
  landlord and the tenant and provides that only the Civil Judge
  having jurisdiction can order or decree for recovery of
c possession only in a suit to be filed by the landlord.
         7. Part-I of the 1996 Act is titled 'arbitration'. Section 8 of
    the 1996 Act is extracted hereinbelow:

          "8. Power to refer parties to arbitration where there is an
D         arbitration agreement.- ill A judicial authority before
          which an action is brought in a matter which is the subject
          of an arbitration agreement shall, if a party so applies not
          later than when submitting his first statement on the
          substance of the dispute, refer the parties to arbitration.
E
          {fl The application referred to in subsection (1) shall not
          be entertained unless it is accompanied by the original
          arbitration agreement or a duly certified copy thereof.

          Ql Notwithstanding that an application has been made
F         under sub- section (1) and that the issue is pending before
          the judicial authority, an arbitration may be commenced or
          continued and an arbitral award made."
  A reading of sub-section (1) of Section 8 of the 1996 Act will
G make it clear that a judicial authority before which an action is
  brought in a matter which is the subject of an arbitration
  agreement shall refer the parties to arbitration. Without 'an
  arbitration agreement', therefore, a judicial authority cannot refer
  the parties to arbitration.
H
     RANJIT KUMAR BOSE & ANR. v. ANANNYA                     653
      CHOWDHURY & ANR. [A.K. PATNAIK, J.]
     8. In this case, there is an arbitration agreement in clause A
15 of the tenancy agreement, which provides that any dispute
regarding the contents or construction of the tenancy agreement
or dispute arising out of the tenancy agreement shall be settled
by arbitration in accordance with the provisions of the 1996 Act.
But the words 'notwithstanding anything in any contract' in B
Section 6 of the Tenancy Act, will override the arbitration
agreement in clause 15 of the tenancy agreement where a suit
for recovery of possession of any premises has been filed by
a landlord against the tenant. Such a suit filed by the landlord
against the tenant for recovery of possession, therefore, cannot c
be referred under Section 8 of the 1996 Act to arbitration. In
fact, sub-section (3) of Section 2 of the 1996 Act expressly
provides that Part-I which relates to 'arbitration' where the place
of arbitration is in India shall not affect any other law for the time
being in force by virtue of which certain disputes may not be 0
submitted to arbitration. Section 6 of the Tenancy Act is one
such law which clearly bars arbitration in a dispute relating to
recovery of possession of premises by the landlord from the
tenant. Since the suit filed by the appellants was for eviction, it
was a suit for recovery of possession and could not be referred
to arbitration because of a statutory provision in Section 6 of E
the Tenancy Act.

     9. In Natraj Studios (P) Ltd. v. Navrang Studios & Anr.
(supra), there was a leave and licence agreement between
Natraj Studios (P) Ltd. and Navrang Studios. On 28.04.1979,         F
Navrang Studios purported to terminate the leave and licence
agreement and called upon Natraj Studios (P) Ltd. to hand over
the possession of the studios to them. Natraj Studios (P) Ltd.
filed a suit on 08.05.1979 in the Court of Small Causes,
Bombay, for a declaration that Natraj Studios (P) Ltd. was a        G
monthly tenant of the studios and for fixation of standard rent
and other reliefs. Navrang Studios filed a written statement
contesting the suit. Natraj Studios (P) Ltd. filed an application
under Section 33 of the Arbitration Act. 1940 in the Bombay
 High Court for a declaration that the arbitration clause in the    H
    654       SUPREME COURT REPORTS                  [2014] 3 S.C.R.

A leave and licence agreement was invalid and inoperative. The
  High Court dismissed the application. Thereafter, Navrang
  Studios filed an application under Section 8 of the Arbitration
  Act, 1940 for appointment of a sole arbitrator to decide the
  disputes and differences between the parties under the leave
B and licence agreement. The High Court allowed the application
  and appointed a sole arbitrator. On appeal being carried to this
  Court by Natraj Studios (P) Ltd., this Court held that Section
  28(1) of the Bombay Rent Act vests an exclusive jurisdiction in
  the Court of Small Causes to entertain and try any suit or
c proceeding between a landlord and tenant relating to the
  recovery of rent or possession of any premises. This Court
  further held that the Bombay Rent Act was a welfare legislation
  aimed at the definite social objective of protection of tenants
  against harassment by landlords in various ways and public
  policy requires that contracts to the contrary which nullify the
0
  rights conferred on tenants by the Act cannot be permitted and
  it follows that arbitration agreements between parties whose
  rights are regulated by the Bombay Rent Act cannot be
  recognized by a court of law. This decision in Natraj Studios
  (P) Ltd. v. Navrang Studios & Anr. (supra) supports our
E conclusion that the arbitration agreement between the landlord
  and tenant has to give way to Section 6 of the Tenancy Act
  which confers exclusive jurisdiction on the Civil Judge, to decide
  a dispute between the landlord and the tenant with regard to
  recovery of possession of the tenanted premises in a suit filed
F by the landlord.

          10. The High Court, however, has relied on three decisions
  of this Court to hold that it is for the arbitral tribunal to decide
  under Section 16 of the 1996 Act whether it has the jurisdiction
G to decide the dispute between the appellants and the
  respondents. We may distinguish those cases from the facts
  of the present case.

      11. In Hindustan Petroleum Corporation Ltd. v. Pinkcity
H Midway Petroleums (supra), Hindustan Petroleum Corporation
     RANJIT KUMAR BOSE & ANR. v. ANANNYA                     655
      CHOWDHURY & ANR. [A.K. PATNAIK, J.]
Ltd. stopped supply of petroleum products to the dealer and          A
the dealer filed a civil suit in the Court of Civil Judge, Rewari.
for a declaration that the order stopping supply of petroleum
product was illegal and arbitrary. Hindustan Petroleum
Corporation Ltd. filed a petition under Section 8 of the 1996
Act praying for referring the dispute pending before the Civil       B
Court to the arbitrator as per Clause 40 of the Dealership
Agreement. The Civil Judge dismissed the petition and
Hindustan Petroleum Corporation Ltd. filed a revision before
the High Court, but the High Court also dismissed the revision.
Hindustan Petroleum Corporation Ltd. thereafter filed an appeal      c
before this Court and this Court held that Section 8 of the 1996
Act in its clear terms mandates a judicial authority before whom
an application is brought in a matter, which is the subject-matter
of an arbitration agreement, to refer such parties to the
arbitration. In this case, the arbitration agreement contained in    D
Clause 40 of the Dealership Agreement was not hit by a
statutory provision like the one in Section 6 of the Tenancy Act
providing that the dispute shall be decided only by a Civil Judge
in a suit notwithstanding a provision in the contract to the
contrary.
                                                                     E
      12. In Agri Gold Exims Ltd. v. Sri Lakshmi Knits &
Wovens & Ors. (supra), the parties had entered into a
memorandum of understanding in relation to the business of
export and the memorandum of understanding contained an
arbitration clause that iri case of any dispute between the two F
parties, the same shall be referred to arbitration, by two
arbitrators, nominated by each of the parties and the award of
the arbitrators shall be binding on both the parties. Agri Gold
Exims Ltd. filed a suit in the District Court at Vijayawada for
recovery of an amount of Rs.36, 14,887/" and for future interest G
on a sum of Rs.53,79, 149/-. Sri Lakshmi Knits & Wovens filed
an application under Section 8 of the 1996 Act for referring the
dispute to the arbitral tribunal in terms of the arbitration
agreement contained in the memorandum of understanding.
This application, however, was dismissed by the District Court, H
    656      SUPREME COURT REPORTS                  [2014] 3 S.C.R.

A but on revision the High Court reversed the order of the District
  Court and referred the parties to arbitration. Agri Gold Exims
  Ltd. carried an appeal to this Court and this Court reiterated
  that Section 8 of the 1996 Act is peremptory in nature and in a
  cas~ where there exists an arbitration agreement, the Court is
B under obligation to refer the parties to arbitration in terms of
  the arbitration agreement, relying on Hindustan Petroleum
  Corporation Ltd. (supra). In this case again, there was no
  statutory bar to arbitration like the one in Section 6 of the
  Tenancy Act providing that the dispute can only be decided by
c the Civil Judge in a suit.
        13. In Branch Manager, Magma Leasing & Finance
  Limited & Anr. v. Potluri Madhavilata & Anr. (supra), Magma
  Leasing Limited Public United Company (for short 'Magma')
  and Smt. Potluri Madhavilata (for short 'hirer') entered into an
D agreement of hire-purchase for the purchase of a motor vehicle
  whereunder the hirer was required to pay hire-purchase price
  in 46 instalments. When the instalments were not paid, Magma
  seized the vehicle and sent a notice to the hirer saying that the
  hire-purchase agreement has been terminated. The hirer then
E filed a suit against Magma in the Court of the Senior Civil Judge
  for recovery of possession of the vehicle and for restraining
  Magma from transferring the vehicle. Magma filed a petition
  before the Civil Judge under Section 8 of the 1996 Act praying
  that the dispute raised in the suit be referred to an arbitrator in
F terms of Clause 22 of the Hire-Purchase Agreement, which
  contained the arbitration agreement. This Court reiterated that
  Section 8 is in the form of legislative command to the court and
  once the prerequisite conditions are satisfied, the Court must
  refer the parties to arbitration. In this case again, there was no
G statutory bar to arbitration like Section 6 of the Tenancy Act
  providing that the dispute can only be decided by a Civil Judge.
         14. The High Court, therefore, was not correct in coming
    to the conclusion that as per the decisions of this Court in the
    aforesaid three cases, the Court has no alternative but to refer
H
       RANJIT KUMAR BOSE & ANR. v. ANANNYA                      657
        CHOWDHURY & ANR. [A.K. PATNAIK, J.]

the parties to arbitration in view of the clear mandate in Section      A
8 of the 1996 Act. On the contrary, the relief claimed by the
appellants being mainly for eviction, it could only be granted by
the "Civil Judge having jurisdiction" in a suit filed by the landlord
as provided in Section 6 of the Tenancy Act. The expression
"Civil Judge having jurisdiction" will obviously mean the Civil         B
Judge who has jurisdiction to grant the other reliefs: decree for
arrears of rent, decree for recovery of arrears of proportionate
and enhanced municipal taxes, a decree for mesne profits and
a decree for permanent injunction claimed in the suit.

     15. For the aforesaid reasons, we allow this appeal and            C
set aside the impugned judgments of the High Court and the
Civil Judge, Senior Division, and remand the matter to the
learned Civil Judge, Senior Division, who will now give an
opportunity to the respondents to put in their written statements
and thereafter proceed with the suit in accordance with law.            D
Considering the peculiar facts of this case, there shall be no
order as to costs.

R.P.                                              Appeal allowed.