Comfort Homes Inn (Bangalore) Private Limited vs The Bangalore Metropolitan Transport Corporation

A.N. Venugopal Gowda, J.—Petitioner has obtained office space to an extent of 1,15,874 square feet in the building belonging to the respondents agreeing to pay licence fee at the rate of Rs. 15,06,362/- p.m. along with service tax with effect from 01.04.2012. According to the petitioner, the licence fee was paid without committing any default. The petitioner claims that during the gestation period between 01.10.2011 to 31.03.2012 - six months, the flooring out of interior refurbishment work was done and that it is not liable to pay the licence fee. Respondent No. 2 having demanded payment of Rs. 45,10,095/-, being the arrears of licence fee, by issuance of a communication dated 27.09.2014, as at Annexure-A, this writ petition was filed to quash the said demand and grant consequential reliefs.

Heard Sri V.B. Shivakumar, learned advocate for the petitioner and perused the writ petition record.

Indisputedly, the agreement between the petitioner and the respondents, as at Annexure-G, provides for resolution of disputes by having recourse to arbitration. An arbitration proceeding in respect of certain claims/disputes between the parties is pending. The demand made vide Annexure-A, can also be the subject matter of arbitration in terms of clause (12.3) of the Concession Agreement (Deed of licence), as at Annexure-G.

In The Empire Jute Co. Ltd. and Others Vs. The Jute Corporation of India Ltd. and Another, , the construction of the contract entered into by and between the parties was in question. There existed an arbitration agreement which was of wide amplitude; by reason whereof not only the dispute relating to quality of the jute sought to be supplied may be gone into, the construction, meaning and operation and effect of the contract or breach thereof, if any, would have also fallen for determination of an arbitrator. Since there was disputed questions relating to facts as also the law, which were required to be determined by the arbitrator, particularly having regard to Section 5 of Arbitration and Conciliation Act, 1996, it was held that, writ petition not ordinarily maintainable, if arbitration clause exists.

In the instant case, the arbitration clause in Annexure-G is of wide amplitude. The demand made vide Annexure-A can also be the subject matter of consideration by the arbitrator, before whom an arbitration proceeding is already pending. In the circumstances, this writ petition being not maintainable, cannot be entertained.

In Unity Service Station Indian Oil Dealers Vs. Indian Oil Corporation Ltd., , it was held that the existence of an alternative remedy does not affect the jurisdiction of the Court to issue a writ, but the existence of an adequate legal remedy is a thing to be taken into consideration in the matter of granting writ. Since, the contract between the parties was in the realm of private law-any dispute relating to interpretation of the terms and conditions of such a contract, it was held that the same cannot be agitated in a writ petition. Writ petition was not entertained since the parties having agreed to settle their dispute by arbitration, were directed to avail the remedy in terms of the contract. It was held that the writ court will not permit recourse to any other remedy without invoking the remedy by way of arbitration. The said decision squarely applies to the case on hand.

In the result, writ petition is rejected, without going into the merit of the matter sought to be raised for consideration and decision. However, liberty stands reserved to the petitioner to approach the arbitrator for resolution of the dispute which has arisen on account of the demand made vide Annexure-A.