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K.C. Food Products (P) Ltd. v/s State of J&K & Others


Company & Directors' Information:- B. P. FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15311MP1994PTC032994

Company & Directors' Information:- S P P FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15412DL2004PTC128666

Company & Directors' Information:- J S FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15314OR1991PTC002964

Company & Directors' Information:- H R B FOOD PRODUCTS PVT LTD [Active] CIN = U15146WB1988PTC045281

Company & Directors' Information:- V D FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15400DL2012PTC231717

Company & Directors' Information:- P R FOOD PRODUCTS PRIVATE LIMITED [Strike Off] CIN = U74899DL1989PTC030483

Company & Directors' Information:- S S FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15310MH2003PTC142530

Company & Directors' Information:- B K FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15312OR1996PTC004541

Company & Directors' Information:- O H P FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U52205DL1999PTC100269

Company & Directors' Information:- K V FOOD PRODUCTS PRIVATE LIMITED [Strike Off] CIN = U15122DL2007PTC162739

Company & Directors' Information:- K. C. FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15431JK1982PTC000554

Company & Directors' Information:- K I C FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15316DL1979PTC009757

Company & Directors' Information:- R B FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15313DL2010PTC202753

Company & Directors' Information:- R K B FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15490KL2013PTC033500

Company & Directors' Information:- K.C. PRODUCTS LIMITED [Strike Off] CIN = U51909DL1990PLC039094

Company & Directors' Information:- S K G FOOD PRODUCTS PRIVATE LIMITED [Strike Off] CIN = U15419UP1991PTC013771

Company & Directors' Information:- B H FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15134DL1997PTC084273

Company & Directors' Information:- N S FOOD PRODUCTS PVT LTD [Strike Off] CIN = U15412WB1992PTC055591

Company & Directors' Information:- H N FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15146UP1990PTC011540

Company & Directors' Information:- V K FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15412UP1988PTC010023

Company & Directors' Information:- B M FOOD PRODUCTS PVT LTD [Strike Off] CIN = U15419WB1993PTC060386

Company & Directors' Information:- I K FOOD PRODUCTS PVT LTD [Strike Off] CIN = U15412WB1991PTC051852

Company & Directors' Information:- S S V FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15499AP1982PTC003547

Company & Directors' Information:- S Q P FOOD PRODUCTS PRIVATE LIMITED [Strike Off] CIN = U15100MH2003PTC139217

Company & Directors' Information:- F S FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15311MH2000PTC126031

Company & Directors' Information:- Z K FOOD PRODUCTS PRIVATE LIMITED [Strike Off] CIN = U15400MH2010PTC209818

Company & Directors' Information:- M B S FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U01112WB2003PTC096375

Company & Directors' Information:- N D FOOD PRODUCTS PRIVATE LIMITED [Strike Off] CIN = U15131DL2002PTC115754

Company & Directors' Information:- C K M FOOD PRODUCTS PRIVATE LIMITED [Strike Off] CIN = U51909KL1998PTC012358

Company & Directors' Information:- G S C FOOD PRODUCTS PVT LTD [Strike Off] CIN = U15316WB1985PTC038398

Company & Directors' Information:- A K G FOOD PRODUCTS PVT LTD [Under Liquidation] CIN = U15412WB1990PTC049789

Company & Directors' Information:- J M D FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15419DL1998PTC097578

Company & Directors' Information:- L K FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15200TG2016PTC103411

Company & Directors' Information:- FOOD PRODUCTS PRIVATE LIMITED [Strike Off] CIN = U15431JK1966PTC000304

Company & Directors' Information:- R R FOOD PRODUCTS PRIVATE LIMITED [Active] CIN = U15490PN2015PTC154753

Company & Directors' Information:- A N FOOD PRODUCTS PRIVATE LIMITED [Strike Off] CIN = U15400TG2013PTC091969

Company & Directors' Information:- R V S K FOOD PRODUCTS PRIVATE LIMITED [Strike Off] CIN = U15490DL2012PTC245851

Company & Directors' Information:- K G Y FOOD PRODUCTS PRIVATE LIMITED [Strike Off] CIN = U15400KA1984PTC005909

Company & Directors' Information:- FOOD PRODUCTS (INDIA) PVT. LTD. [Strike Off] CIN = U15311HR1994PTC032356

Company & Directors' Information:- M K FOOD PRODUCTS PVT LTD [Strike Off] CIN = U15209DL1979PTC009924

    A.A. No. 04 of 2010 & CMA No. 02 of 2010

    Decided On, 29 November 2013

    At, High Court of Jammu and Kashmir

    By, THE HONOURABLE MR. JUSTICE M.M. KUMAR

    For the Petitioner: S.K. Anand, Advocate. For the Respondents: Gagan Basotra, Sr. AAG, Ajay Abrol, Advocate.



Judgment Text

M.M. Kumar, J.

1. This is an application under Section 11 of the Jammu and Kashmir Arbitration and Conciliation Act, 1997 (for brevity 'the Act') with a prayer for appointment of an independent arbitrator and reference of the dispute which has arisen between the parties for adjudication. On facts it is conceded that there is a lease, agreement executed between the petitioner and respondent No. 2, namely, the Jammu and Kashmir State Industrial Development Corporation Limited (for brevity 'the SIDCO'). The SIDCO, after considering the request of the petitioner, had agreed to lease out the premises to the petitioner for establishment of an industrial unit to manufacture biscuits and allied products for a period of 90 years. In that regard lease deed was executed on 28.12.1981. The question with regard to the rent has been referred in Clause 1(iii). The same is set out below in extenso:-

"(iii) That it is hereby declared that the Lessee has paid to the SIDCO a sum of L 30,000/- (Rupees Thirty Thousand only) as premium at the rate of L 1500/- per kanal and advance ground rent to L 549/- (with effect from 23rd December, 1981 to 31st March, 1982) at the rate of L 100/- per Kanal in accordance with the terms and conditions set out in the allotment order in observance and performance of the several conditions and covenant as herein contained."

1.1. According to the aforesaid clause, advance ground rent of L 549/- with effect from 23rd December, 1981 to 31st March, 1982 at the rate of L 100/- per Kanal was paid as per the terms and conditions set out in the allotment letter. The petitioner-lessee had the authorisation to raise the necessary construction on the allotted premises which were required in connection with the establishment of the industrial unit to manufacture biscuits. However, it was to be done after obtaining written permission from the SIDCO. There is another clause which deals with the issue of rent, namely, clause 3(ii) and the same is set out below:-

"(ii) That the Use of the land allotted and the terms in respect of rent or other matters not specifically covered under this Deed are subject to such orders as the SIDCO may issue from time to time."

2. A perusal of the aforesaid clause would show that the terms concerning rent or other matters not specifically covered by the lease deed would be subject to such orders as may be passed by the SIDCO from time to time. It is thus obvious that the issue concerning rate of rent is not outside the scope of clause 1(iii), to which reference has already been made in the preceding para.

3. On account of an order passed on 25.04.2007 by respondent the rate of ground rent has been revised to L 3000/- per kanal per year. Due to revision of rent a dispute has arisen as to whether the SIDCO is vested with the power to enhance the rent unilaterally.

4. Learned counsel for the petitioner has drawn my attention to Clause 20 of the lease deed which provide for arbitration. In case of any dispute which may arise between the parties then the same must be referred to arbitration. The Chairman SIDCO has been named as arbitrator in clause 20 of the lease deed. Clause 20, which provide for arbitration, reads as under:-

"20. If any doubt, dispute, question of difference shall at any time hereinafter arise, concerning the construction effect or meaning of these presents or of any matter herein contained or their perspective rights and liabilities hereunder, every such doubt, dispute, question or difference shall be referred to the Chairman SIDCO for arbitration under Jammu and Kashmir Arbitration Act. The decision of the arbitrator thereon shall be final, conclusive and binding on the parties."

5. The petitioner, feeling aggrieved of the order dated 25.04.2007, revising rate of ground rent, sent a registered A/D notice on 13.05.2008, calling upon the Officer of the SIDCO to make a reference of the dispute to the arbitrator in terms of clause 20 of the lease deed. In the notice reference has also been made to a judgment of this Court in OWP No. 120/1992, which was decided on 23.11.1992, where directions were issued to the officers of the SIDCO that before enhancing the ground rent and premium, the petitioner must be associated. In the aforesaid order a reference has also been made to the arbitration clause as well but on account of the approach adopted by this Court at that stage the matter was disposed of by issuing the aforesaid directions.

6. Having heard the learned counsel for the parties and perusing the record, I am of the considered view that twin test which has been well known for appointment of arbitrator, stands satisfied in the present case. In SBP and Co. v. Patel Engineering Ltd. and Anr. (2005) 8 SCC 618 and Union of India v. Onkar Nath Bhalla (2009) 7 SCC 350, it has been laid down that if there is an arbitration clause and a dispute between the parties, then reference shall be made to the arbitration. According to clause 20 the Chairman of SIDCO is to act as an arbitrator. However, in the present case reference to the Chairman would not be desirable as after issuance of notice as early as on 13.05.2008, the respondents have failed to appoint the arbitrator within a period of 30 days in terms of the provisions of Section 11(4) and 11(5) of the Act. It is conceded as a fact that no arbitrator has been appointed till date. Accordingly it is imperative to appoint an independent arbitrator by the Court because the Chairman is the Minister Industries. He would not be free from tilt in favour of the department he heads. It has now been well settled by Hon'ble the Supreme Court that in such like cases an independent arbitrator should be appointed. In that regard reliance may be placed on the judgments rendered Datar Switchgears Limited v. Tata Finance Ltd. and anr. (2000) 8 SCC 151, Punj Lloyd Ltd. v. Petronet MHB Ltd. (2006) 2 SCC

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638, Indian Oil Corporation Limited v. Raja Transport (P) Ltd. (2009) 8 SCC 520 and Deep Trading Company v. Indian Oil Corporation, (2013) 4 SCC 35. 7. In view the above, I hereby appoint Shri Subash Gupta, retired District Judge as arbitrator. He may enter upon the reference and decide the same in accordance with law. The parties would be at liberty to take all the grounds before the arbitrator including the ground that enhancement of the rent is not arbitrary. The Registrar (Judicial) is directed to inform the arbitrator of his appointment to enter upon for his award on the claims made to him by the parties in terms of the Contract Agreement.
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