16 April 2025 Rent >> Property & Real Estate  

The Bombay High Court has declined to grant interim measures under Section 9 of the Arbitration and Conciliation Act, 1996, in a petition seeking the eviction of tenants, some of whom hold statutory protection and a decree in their favor, to facilitate the redevelopment of a building. The court found that the petition, filed by SJK Buildcon LLP (the Developer) acting on behalf of the Landlords of Keni House, inappropriately sought to circumvent the jurisdiction of the relevant rent courts established under the Maharashtra Rent Control Act, 1999.

The Developer had entered into a Development Agreement with Ms. Kusum Pandurang Keni and Mr. Ninad Ajay Keni (the Landlords) to redevelop Keni House, a building with 22 tenements, 18 of which are occupied by tenants. The petition labeled two groups of tenants – the legal heirs of the late Mr. Umanath Saligram Mishra (the Protected Tenants) and Mrs. Supriya Sengupta – as "non-cooperating tenants/occupants."

A critical point highlighted by the court was the fact that the Protected Tenants were not merely tenants but also held a decree from the rent courts affirming their statutory protection. A judgment by the Small Causes Court in 2012, declaring tenancy rights in Ganesh Flour Mill in favor of the original tenant, was upheld by the Appellate Court in 2015. The Landlords did not challenge this appellate judgment, making the Protected Tenants' status as legally protected tenants absolute. Despite this, the petition referred to them as "illegal occupants" of a "garage" where they operated a flour mill.

The court emphasized that the petition's objective appeared to be "speedy eviction," a matter squarely within the purview of Section 16 of the Rent Act, which governs the recovery of possession for demolition and redevelopment. Section 33 of the Rent Act further grants exclusive jurisdiction to the Small Causes Court to adjudicate such matters, overriding any other law in force. The High Court found a direct conflict between invoking Section 9 of the Arbitration Act and the specific provisions of the Rent Act designed to protect tenants.

Drawing a parallel with the Supreme Court's ruling in Bajarang Shyamsunder Agarwal vs. Central Bank of India, which protected the rights of pre-existing tenants against the powers of secured creditors under the SARFAESI Act, the High Court reasoned that the temporary interim measures under Section 9 of the Arbitration Act, lacking a non-obstante clause, could not override the statutory protections afforded to tenants under the Rent Act, especially those already affirmed by the competent rent courts.

Regarding Mrs. Supriya Sengupta, the court noted that she had lost her legal battle up to the Supreme Court, which had dismissed her Special Leave Petition and granted her a final extension to vacate the premises by January 31, 2025. With contempt proceedings reportedly filed against her in the Supreme Court for failing to vacate, the High Court deemed it inappropriate to issue any directives in her case.

In its conclusion, the High Court dismissed the petition without granting any interim measures. It asserted that the templated approach often used to evict dissenting members of co-operative societies was incongruously applied in this case, which involved individual tenants with legally established rights. The court directed the Developer and the Landlords to abide by the rule of law and respect the pre-existing tenancy rights of the Protected Tenants, emphasizing that the exclusive jurisdiction to address the issues raised lay with the rent courts under the Rent Act. The court refrained from commenting on the merits of the relocation arrangements offered to the Protected Tenants, citing its lack of jurisdiction in the matter.

Maharashtra Rent Control Act, 1999  

Arbitration and Conciliation Act, 1996