- 1 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 26TH DAY OF MARCH, 2025 PRESENT THE HON'BLE MR JUSTICE V KAMESWAR RAO AND THE HON'BLE MR JUSTICE T.M.NADAF COMMERCIAL APPEAL NO.313 OF 2024 BETWEEN: M/S JSM CORPORATION PRIVATE LIMITED A COMPANY INCORPORATED UNDER THE COMPANIES ACT, 1956, HAVING ITS REGISTERED OFFICE AT 3RD FLOOR, TODI BUILDING, MATHURDAS MILL COMPOUND, LOWER PAREL WEST, MUMBAI – 400 013 ALSO AT SHIRO LOUNGE BAR, UNIT NO.222, 3RD FLOOR, UB CITY, NO.24, VITTAL MALLYA ROAD, BENGALURU – 560 001 ALSO HAVING OFFICE AT EMBASSY POINT, I FLOOR, 150, INFANTRY ROAD, BANGALORE – 560 001 REPRESENTED BY ITS AUTHORISED REPRESENTATIVE MR. SANJAY MAHTANI …APPELLANT (BY SRI. SRIHARI S & MS. SUNEHA BHANDARY, ADVOCATES FOR SRI. AJESH KUMAR S, ADVOCATE) Digitally signed by MADHUSHREE H Location: High Court of Karnataka - 2 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 AND: 1. M/S BRUNTON DEVELOPERS A REGISTERED PARTNERSHIP FIRM HAVING ITS OFFICE AT THE FALCON HOUSE, NO.1, MAIN GUARD CROSS, BENGALURU – 560 001 REPRESENTED BY ITS PARTNER, MR T.B.VENKATESH. 2. M/S PRESTIGE CUISINE A REGISTERED PARTNERSHIP FIRM HAVING ITS OFFICE AT: UNIT NO.207, COPPER ARCH, NO.83, INFANTRY ROAD, BENGALURU – 560 001 REPRESENTED BY ITS PARTNER, MR T.B. VENKATESH. …RESPONDENTS (BY SRI. C.K.NANDA KUMAR, SENIOR COUNSEL FOR SRI. RAGHURAM CADAMBI, ADVOCATE FOR C/R ) THIS COMAP IS FILED UNDER SECTION 13(1A) OF THE COMMERCIAL COURTS ACT, 2015 PRAYING TO SET ASIDE THE IMPUGNED ORDER DATED 05.06.2024 PASSED ON I.A.NO.1 IN COM. OS NO.835/2023 BY THE COURT OF LXXXII ADDL. CITY CIVIL AND SESSIONS JUDGE, AT BENGALURU (CCH-83) AT ANNEXURE-A AND CONSEQUENTLY ALLOW THE APPLICATION FILED BY THE APPELLANT HEREIN UNDER SECTION 8 OF THE ARBITRATION AND CONCILIATION ACT AT ANNEXURE-G AND REFER THE PARTIES TO ARBITRATION IN TERMS OF CLAUSE 12 OF THE AGREEMENT TO LEASE DATED 31.05.2008 AT ANNEXURE-F. THIS APPEAL COMING ON FOR ADMISSION THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE V KAMESWAR RAO and HON'BLE MR JUSTICE T.M.NADAF - 3 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 ORAL JUDGMENT (PER: HON'BLE MR JUSTICE T M NADAF) This appeal has been filed by the defendant challenging the order dated 05.06.2024, passed on I.A.No.1 filed under Section–8 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘Act 1996’ for brevity) in Com. OS No.835/2023, by the LXXXII Addl. City Civil And Sessions Judge, Bengaluru (CCH-83) at Annexure-A. 2. The parties will be referred to as per their ranking before the Trial Court for easy reference. 3. The facts leading to the case are as under: The defendant / appellant is a company incorporated under the Companies Act. The company entered into an agreement to lease on 31.05.2008, with M/s. United Breweries (Holdings) Ltd and M/s. Prestige Estates Projects Pvt. Ltd. As per the lease agreement, the suit schedule property i.e. the demised premises (morefully - 4 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 described in Schedule-B to the suit) bearing Unit No.222, Triple Height (between Canberra And Comet Block) measuring 4210 square feet super built-up area (covered area) and 2756 square feet outside seating area in UB City built on Schedule ‘A’ property. The lease agreement in respect of the demised premises was for three terms, each term for three years period commencing from 01.07.2008 and ending on 30.06.2017. The plaintiffs purchased the property from its erstwhile owners i.e., M/s. United Breweries (Holdings) Ltd. and M/s. Prestige Estates Projects Pvt. Ltd. Plaintiff No.1 purchased share of M/s.United Breweries (Holdings) Ltd., by way of a sale deed dated 21.05.2012 and the plaintiff no.2 purchased share of M/s. Prestige Estates Projects Pvt. Ltd., by way of a sale deed dated 11.11.2011 in the ‘B’ schedule property. A letter of acknowledgment of attornment was issued by M/s. United Breweries (Holdings) Ltd., to the defendant regarding the sale of defendant’s portion in the ‘B’ schedule property and recognized the plaintiffs as the owners to the extent of their share and instructed the - 5 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 defendant to pay the rent from 01.07.2012 to the plaintiffs. 4. The defendant asserts that in view of attornment, the plaintiffs are stepping into the shoes of earlier owners and bound by the lease agreement. Accordingly, they are collecting the rents from the defendants. The defendant on 30.12.2016 made a representation for renewal of lease and license agreement executed on 31.05.2008 to the plaintiffs, which reads as follows: “Subject: Renewal of Leave and License Agreement executed on 31 May, 2008. Sir, With reference to the above mentioned subject, we hereby wish to slate that upon completion of the current term of the Agreement on 30th June, 2017, we would like to renew the said Agreement, subject to mutual consensus on the terms & conditions at the time of such renewal. We shall execute the fresh agreements for the renewed term assuming both parties reach a mutual consensus of the commercial terms & conditions. - 6 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 Kindly consider this our intimation of prior six month notice before expiration of the contract as per the Clause 5.1 of the Agreement. Thanking you, Sincerely. For JSM Corporation. Private Limited Authorised Signatory” However, the same has not yielded any fruits. 5. The plaintiffs filed a suit against the defendant in COM O.S.No.835/2023, seeking the following reliefs : “WHEREFORE, the Plaintiffs humbly pray that this Hon'ble Court may be pleased to pass a Judgment and Decree in favour of the Plaintiff as follows: A. Directing the Defendant to quit, vacate and deliver vacant and peaceful possession of the Schedule B Property to the Plaintiffs; B. Direct the Defendant to pay the Plaintiffs a sum of 7,39,21,403/- (Rupees Seven Crores Thirty Nine Lakhs Twenty One Thousand Four Hundred and Three only), towards arrears of rent up to 22.08.2022; C. Direct the Defendant to pay an interest of Rs.1,91,65,250/- (Rupees One Crore Ninety One Lakhs Sixty Five Thousand Two Hundred and Fifty only) towards interest on the arrears - 7 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 of rent of Rs. 7,39,21,403 (Rupees Seven Crores Thirty Nine Lakhs Twenty One Thousand Four Hundred and Three only) from the dates on which the Rents became due till 22.08.2022; D. Direct the Defendant to pay to the Plaintiffs mesne profits at the rate of 24.38,100/- (Rupees Twenty Four Lakh Thirty Eight Thousand One Hundred only) per month, As damages for the illegal use and occupation of the Schedule B Property from 22.08.2022 till the date on which the Defendants hand over vacant and peaceful possession of the Schedule Property to the Plaintiffs; E. In the alternative, direct an enquiry to be held under Order XX, Rule 12 of the Code of Civil Procedure, 1908, to determine the mesne profits that the Defendant is liable to pay the Plaintiffs, from August 2022 till the date on which the Defendant hands over vacant and peaceful possession of the Schedule B Property to the Plaintiffs; F. Grant such other and further reliefs as this Hon'ble Court deems fit, including costs of this suit.” - 8 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 6. After service of notice, the defendant appeared and filed I.A. No.1 under Section-8 of Act 1996, seeking to refer the parties to arbitration under Clause-12 of the agreement of lease dated 31.05.2008. In the Affidavit supporting the said application, the defendant contended that in view of the agreement to lease dated 31.05.2008, the plaintiffs having purchased the property in the year 2011 and 2012 stepped into the shoes of erstwhile owners and are bound by the terms of the lease agreement, in view of attornment clause contained in the lease agreement. Clause–12 of the agreement states about dispute resolution, particularly at clause – 12.4, which states that the dispute shall finally be settled by arbitration by a Sole Arbitrator to be mutually agreed upon by the parties and in the event of difference of opinion for appointment of a Sole Arbitrator, the party aggrieved can seek appointment of the Arbitrator by approaching this Court in accordance with the provisions contained in Act 1996. It is further contended that in view of memorandum of understanding dated 15.05.2014, between the - 9 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 defendant and M/s. United Breweries (Holdings) Limited and Prestige Estate Projects Private Limited, the parties are required to approach an Arbitrator for a dispute resolution. Since the dispute as made out by the plaintiffs pertain to the leased premises under the agreement to lease dated 31.05.2008, the same is required to be resolved through dispute resolution mechanism as contemplated under the agreement. 7. It is further contended that the defendant has disputed the amount claimed by the plaintiffs in their reply notice dated 17.08.2022, to the notice issued by the plaintiffs terminating the lease and seeking possession of the property. With these contentions, the defendant sought the matter to be referred to an Arbitrator for dispute resolution. 8. The plaintiffs filed their objections to the application asserting that the plaintiffs were not parties to the said agreement and the terms and conditions in the agreement cannot bind them and is not effective against - 10 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 the non-signatories. Further, contended that the agreement to lease dated 31.08.2008 expired by efflux of time on 30.06.2017 and the present suit filed by the plaintiffs seeking the reliefs inter-alia, arrears of rent from September 2018. Therefore, the present cause of action is beyond the transaction contained in the arbitration agreement. Hence, stresses that the arbitration clause is redundant and perished contract by efflux of time, could not be invoked. Further, stated that the attornment contained in the lease agreement has no binding force on the plaintiffs with respect to the arbitration clause at the most the attornment is only an acknowledgment of ownership and for collection of rent and cannot be construed more than that. 9. The trial court upon considering the rival contentions passed the order dismissing the application filed under Section–8 of Act 1996, holding that the arbitration clause contained in the agreement to lease 31.05.2008 stands perished with efflux of time and the - 11 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 same cannot be enforced. The reasons for the said conclusion starts from paragraph No.11 onwards, which are reproduced as under: “11. The lease agreement has expired by efflux of time and the dispute between the parties is not covered by the lease agreement. The landlord is seeking ejectment of the tenant and the said dispute is not covered by the agreement. Therefore, the arbitration clause in the lease agreement does not cover this dispute. 12. Now, the question arises whether in whether in view of non compliance of terms of Lease agreement, still the condition mentioned in Lease Deed with regard to Arbitration survives. In view of the settled proposition of Law by the Hon'ble Supreme Court in Kishorilal Gupta's case (supra) and in M/s V.S. Enterprizes's case (supra) and in view of the express, clear and unambiguous intention of the parties expressed in the lease deed, no scope for drawing upon hypothetical considerations or supposed intentions of the parties arise. In view of the terms of the lease deed the arbitration clause contained therein stands perished with efflux of time. Since the lease has not been renewed at the instant of the petitioner, the contract already stands extinguished by efflux of time. - 12 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 13. Clause 5.1 of Lease deed reads as under: "If the Lessee desires to seek renewal of the lease on or before 30.06.2017, the Lessee shall issue a notice to the Lessors at lease six months prior to the date of the expiry of the Lease Term, expressing its desire to renew, failing which the Lease shall stand terminated at the expiry of the Lease Term. Clause 5.2 of Lease deed reads as under: On issuance of renewal notice by the Lessee, both parties shall finalize and conclude the terms of renewal during the six months time and execute a Lease Deed for the renewed term. If the Lessors and the Lessee do not reach fresh lease deed, the Lease granted in favour of the Lessee shall stand terminated at the expiry of the Lease Term granted herein and all the consequences of termination detailed in this agreement shall follow. Provided nothing contained in this clause shall be construed as giving right to the Lessee to seek renewal of the lease and the Lessors have absolute right to accept or reject the Lessee's request for renewal without assigning any reasons. Memorandum of understanding dtd.15.05.2014, clause 18 and 19 contended that: "This Memorandum of Understanding shall be valid for a period of 3 Years (three years), - 13 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 renewable thereafter on mutually agreed terms and conditions at the sole option of the Lessors. Notwithstanding any of the terms and conditions herein, Lessee or Lessors shall have the right to terminate this Memorandum of Understanding with three (3) months advance notice in writing. This Agreement shall be co-terminus with the Lease agreement date 16th January 2009 in respect of Unit No 222, on Triple Height, in between Canberra Block and comet Block. In case, the Lease agreement is terminated for any reason whatsoever, then this Understanding shall also stand Memorandum of Understanding shall also stand terminated forthwith" 14. Admittedly, in this case, the lease was not renewed. As per the above clause of the Lease deed, the Lessor have absolute right to accept of reject the Lessees request for renewal without assigning any reason. 15. In the present case, from the averments of W/S it is clear that, thought the Defendant has sent draft Lease Deed for renewal, but the plaintiff has not accepted. Hence, it is clear that, after 30.06.2017, there is no written lease agreement between the Plaintiff and Defendant. 16. From the above discussion, it is clear that, since the Lease deed between the parties has come to an end there is no question of invoking the alleged - 14 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 Arbitration clause nor the question of surviving such Arbitration clause remains. The arbitration clause has become equally defunct, in valid, not in pursuance of Lease after expiry of the Lease period. In subsisting and not applicable as the Defendant possession is this regard, I relied upon the decision of M/s.V.S.Enterprises v/s B.R.Sharma - 2012 2 RCR Civil 160 - wherein Hon'ble High Court held that: "2. It is a case where the plaintiff-respondent filed a suit for possession by way of ejectment as also relief of as a permanent injunction seeking. consequence thereof. Facing this suit, the defendant- petitioner filed an application under the aforesaid provisions for referring the matter to arbitration for proper adjudication of the matter as per the terms of the lease agreement dated 6.9.2004 (Annexure P2). "4. The application was opposed claiming that the lease agreement dated 6.9.2004 was for a period of three years and the said period had expired on 5.9.2007. It is further averred that the lease has not been renewed thereafter and the plaintiff has sought vacant possession of the premises. He has also claimed that he has served a legal notice to the defendant- petitioner dated 10.4.2008 terminating the tenancy. Alleging that the lease agreement was, not in force on the date of filing of the suit, - 15 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 therefore, clause 12 of the agreement regarding arbitration would not come into operation." 17. The lease under the aforesaid clause was initially to be for a period of 3 years. It could be terminated earlier but not within six months of the commencement. There is no provision for its extension in this agreement. The lease agreement dated 6.9.2004 has expired on 5.9.2007 and moreover no agreement between the parties extending the term of the lease, although not provided for in the agreement. The occupation of the tenant over the demised premises after the expiry of this lease agreement is not under this agreement. He is a tenant over the premises under the law, which protects his possession. 18. The lease agreement has expired by efflux of time and the dispute between the parties is not covered by the lease agreement. The landlord is seeking ejectment of the tenant and the said dispute is not covered by the agreement. Therefore, the arbitration clause in the lease agreement does not cover this dispute. 19. Admittedly, in the present case, the Defendant neither paid the arrears of rent nor he got renewed the lease after giving three months' prior notice as per the terms of the lease agreement nor he vacated the demised premises. The lessor had to approach - 16 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 the Civil Court for vacation of the demised premises in question. 20. Thus, in view of the settled proposition of law by the Supreme Court in Kishorilal Gupta's case (supra) and this Court in M/s V.S. Enterprizes's case (supra) and in view of the express, clear and unambiguous intention of the parties expressed in the lease deed, no scope for for drawing upon hypothetical considerations or supposed intentions of the parties arise. In view of the terms of the lease deed the arbitration clause contained therein stands perished with efflux of time. Since the lease has not been renewed at the instant of the petitioner, the contract already stands extinguished by efflux of time. 21. The logical outcome of the above discussion would be that arbitration clause perished with the lease deed dated 31.05.2008 coming to an end and the same cannot be enforced. The possession of the petitioner is unauthorised, so the arbitration clause will have no effect so far as the suit for possession by way of ejectment, for recovery of arrears of rent and mense profits is concerned. In these circumstances, the case cannot be referred at all to the arbitration. The terms of the lease deed does not provide for reference of future disputes to arbitration. In view of this, the Court cannot refer to arbitration clause for the disputes other than those - 17 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 specifically referred to in the arbitration agreement/clause unless the parties agreed to refer such disputes. 22. In the light of the above discussions, I hold that, the application filed by the Defendant is liable to be dismissed. Accordingly, answer the point no.1 in "Negative". 10. Assailing the order passed by the trial court stated supra, the defendant is in appeal. 11. Heard Sri.Srihari.S and Ms.Suneha Bhandary, learned counsel for Sri.Ajesh Kumar.S, Advocate for the appellant and Sri.C.K.Nanda Kumar, learned Senior Counsel for Sri.Raghuram Cadambi, Advocate for Caveator /respondent, perused the order impugned and materials placed on record. 12. Sri.Srihari, learned counsel for the appellant reiterating the grounds urged in the memorandum of appeal, submits that the agreement to lease dated 31.05.2008 was for three terms, each term consisting of three years ending on 30.06.2017. The plaintiffs having - 18 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 purchased the property in the year 2011 and 2012 from the erstwhile owners, in view of attornment clause stepped into the shoes of earlier owners and are bound by the terms of the lease agreement. That apart, the plaintiffs and the defendant are claiming rights under the agreement entered into between the defendant/appellant and erstwhile owners and respondents/plaintiffs having purchased the property in dispute are bound by clause– 12.4 of the agreement. He further submits that though the lease period comes to an end in 2017, but the lease continued between the plaintiffs and the defendant which amounts to continuation / deemed renewal of agreement to lease. As such, the clause is still in existence and the plaintiffs cannot maintain a suit, the parties are required to be relegated for arbitration. He further asserts on clause no.6 found in sale deed dated 21.05.2012 and 11.11.2011, which reads as under: “6) POSSESSION: The Sellers have this day delivered and put the Purchasers in constructive possession of Schedule ‘B’ - 19 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 Property. The Schedule ‘C’ property is tenanted and hence the Sellers have delivered to the Purchasers possession thereof by attornment of the tenancy of the tenant therein. The Purchasers shall be entitled to receive / recover the rent of the Schedule ‘C’ Property on and from this day. The Sellers have also transferred separately the interest free Refundable Deposit paid by the said tenant to the Purchasers, which the Purchaser acknowledge receipt thereof and agree to refund the same to the tenant on termination of tenancy in terms of the Lease Agreement entered into between the Sellers and the said tenant, the Certified Copy of which is delivered to the Purchasers. The Purchasers having gone through the same have agreed to be bound by the terms and conditions of the Lease Deed.” 13. He further asserts that before expiration of agreement to lease dated 31.05.2008 he has made a representation for renewal which is in accordance with clause–(5) to the agreement. To buttress his arguments, he relied on the judgments of the Hon’ble Apex Court in the case of (i) Brij Raj Oberoi vs. Secretary Tourism and Civil Aviation Department and Another1, (ii) 1 (2022) 17 SCC 81 - 20 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 Central Wearhousing Corporation And Another vs. M/s.Sidhartha Tiles And Sanitary Pvt. Ltd.2, and the judgment of this Court in the case of (iii) Gokalda Images Pvt. Ltd. Vs. Aries Agro – VET Associates (Pvt) Ltd3. 14. Refuting the submissions of the learned counsel for the appellant, Sri.C.K.Nanda Kumar, learned Senior Counsel for the respondents would submit that the application under Section-8 of Act 1996 is not maintainable as the agreement to lease dated 31.05.2008 between the erstwhile owners and the defendant had come to an end by efflux of time. That apart, the plaintiffs are not signatories to the said agreement to lease, thus the attornment clause cannot be construed beyond the acknowledgment of ownership and payment of rent. In the absence of agreement between the parties, the tenancy for the demised premises has been on a month to month 2 2024 SCC Online 2983 3 W.P.No.1305/2022, dtd. - 21 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 basis with rents being paid as per the terms orally agreed between the parties. The defendant started defaulting on payment of rents since September 2008 onwards, despite several reminders having been sent and opportunities to rectify the default and repeated warnings. As the defendant have failed to pay the rent which ultimately made the plaintiffs to issue notice terminating the tenancy and asking the defendant to quit and deliver the Schedule ‘B’ property and to pay arrears of rent with interest and also mense profits. 15. The learned Senior Counsel further asserts that, to invoke Section-8 of the Act 1996, first there must be compliance of Section-7 of the Act 1996. Section-7 is very specific in its application, which states about arbitration agreement. Sub-section-(1) specifies that the parties by means of arbitration agreement agreed to submit to arbitration all disputes which may arise in respect of a defined legal relationship whether contractual or not. Sub- section - (2) states that there must be an arbitration - 22 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 clause and Sub-section-(3) states that it shall be in writing and Sub-section-(4) states the modes whereby the agreement of arbitration be construed as it is in writing. In the case on hand, there was no agreement to lease between the plaintiffs and the defendant. The agreement to lease dated 31.05.2008 was between the defendant and the erstwhile owners, though there is an attornment, which is only in respect of acknowledgment of ownership and the payment of rent and nothing more than that which is clear from the letter of the erstwhile owner addressed to the defendant dated 29.06.2012. The defendant having agreed for the same, continued as a tenant on month to month basis. 16. Sri.C.K.Nanda Kumar further stresses upon the alleged letter dated 30.12.2016 issued by the defendant seeking to renew the lease executed on 31.05.2008, wherein, the defendant requests for a renewal on mutual consensus on terms and conditions and for execution of a fresh agreement on the mutual consensus of the - 23 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 commercial terms and conditions. It is asserted that there was no such agreement between the plaintiffs and the defendant and on an oral understanding they continued as owner and the tenant on month to month tenancy and in view of default in payment of rent, the tenancy was terminated and the suit filed seeking for the appropriate reliefs against the defendant. In that view of the matter, in the absence of any arbitration clause and any agreement between the parties, the application filed under Section-8 of Act 1996 is not maintainable. 17. The learned Senior Counsel further asserts that, the arguments of the appellant on renewal clause is futile, for the reason that the agreement gets terminated by efflux of time and follows the consequences of termination clause as enumerated in clause-11, especially clause-11.1. He further asserts that the conduct of the party continuing in the demised property on an understanding of month to month basis, acquiesced by conduct in continuing as tenant on month to month rent basis. Since there was - 24 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 default in the payment of rent as has been agreed, the present suit is filed for the reliefs. In the given facts, the application under section-8 of the Act 1996 is not maintainable. 18. He relies on the judgment of Coordinate Bench of this Court in the case of Balakrishna Gambhir vs. Sumalatha R. Shetty4 and submits that the application under Section-8 of the Act 1996 is not maintainable once the alleged agreement to lease comes to an end by efflux of time, the clause contained therein with respect of Arbitration also gets perished. 19. From the above, narration and contentions of the parties, the undisputed facts in the lis are as under: i) The defendant entered into an agreement to lease dated 31.05.2008, with the erstwhile owners of the parties. 4 MFA No. 5331/2014, dtd. 03.03.2023 - 25 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 ii) The plaintiffs purchased the property from the earlier owners by way of a registered sale deed in the year 2011 and 2012. iii) The letter issued by one of the earlier owner to the defendant acknowledging the ownership of the present plaintiffs and payment of rents. iv) The letter / representation by the defendant issued seeking for renewal, wherein, he has sought for renewal subject to mutual consensus on the commercial terms and conditions between the parties, which was not acceded. v) The plaintiffs are not the signatories to the agreement to lease dated 31.05.2008. vi) The agreement to lease dated 31.05.2008 expired by efflux of time as there is no renewal. - 26 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 20. The disputed facts are as under: i) As per the defendant, despite the expiry of agreement to lease the clause contained in the arbitration continues in view of attornment clause contained in the agreement to lease and the plaintiffs being the subsequent purchasers stepped into the shoes of the earlier owners and the relationship continued. ii) As per the plaintiffs the lease agreement was with the earlier owners and the same expired by efflux of time, as such the clause of arbitration also gets perished. The defendants continued as tenant on month to month tenancy by accepting the rents to the demised property. 21. In view of the above undisputed facts, the agreement to lease dated 31.05.2008 comes to an end by efflux of time, the same was not renewed. It is trite law that, the arbitration clause contained in the agreement gets perished with the agreement which expires by efflux of time. A perusal of clause–12, contained in the said agreement to lease reproduced above states - 27 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 specifically with the opening words ‘expect as otherwise specifically provided in this Deed, the following provisions apply only if any dispute or difference arises between the parties arising out of or relating to lease of the demised premises. (emphasis supplied) In view of expiry of the agreement to lease by efflux of time, there is no lease between the parties subsisting in respect of the demise property, on the earlier terms and condition. The demised property continued on month to month rent basis as per the mutual oral understanding, as there is a short fall in payment of monthly rent by the defendants despite reminders and the requests, which ultimately resulted in issuance of notice of termination followed by institution of suit seeking for appropriate relief as extracted above by us. 22. The contention of the defendant that the clause holds good for future dispute after the expiry of the agreement to lease does not hold any water as the clause extracted above do not provide any such details as to - 28 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 whether disputes arising after or subsequent to the expiry of the contract or any other future disputes between the parties could be referred for Arbitration. 23. In view of the same, the contentions of the defendant cannot be accepted to maintain an application under Section – 8 of the Act 1996. 24. We hold that the learned Senior counsel is right in his submission, that, to invoke Section-8 there must be compliance of Section-7 of the Act 1996 which contemplates that there shall be an arbitration agreement in writing between the parties exposing the consensus of the parties to bind themselves under the agreement in respect of the arbitration. In the absence of such a compliance; Section-8 application is not maintainable. That apart, sub-section-(2) of Section-8 in a pellucid manner stipulates that - “an application referred to in sub- section (1) shall not be entertained unless it is accompanied by a original arbitration agreement or a duly certified copy thereof.” As per the admitted facts stated - 29 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 above, the agreement to lease comes to an end by efflux of time, admittedly there is no subsequent renewal of any arbitration agreement in writing between the parties to the lis. In these circumstances, the application under section-8 is not at all maintainable in law, is as much as, the dispute raised by the plaintiff is for the period post September 2018 and admittedly there is no fresh lease for that period. 25. So far as the judgments relied by the defendant / appellant, the same are distinguishable on facts. That apart, by the subsequent conduct, after the expiration of the agreement to lease by efflux of time, except a representation in the year 2016 there is nothing on record to show that there is an arbitration agreement entered into between the parties or there is renewal of the earlier agreement between the parties. The defendant acquiesced to the mode of tenancy continuing on month to month basis by payment of rent. The alleged default in payment - 30 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 of rent has given a cause for the plaintiffs to institute a suit seeking for reliefs stated above. 26. We hold that the judgment relied on by the plaintiffs applies with all force to the case on hand, wherein, the Coordinate Bench of this Court has manifestly encountered a similar situation on facts holding that an application under section-8 of the Act 1996 is not maintainable. The reasons in the order contained in paragraph No.12 onwards are reproduced as follows: “12. A bare perusal of the aforesaid clause reveal that the parties have agreed to have dispute between them to be referred for arbitration during the subsistence of the lease agreement. This is clear from the use of the terminology "Lessor" and "Lessee". After the expiry of the lease agreement the relationship between the parties do not survive and they no longer remain as "Lessor" and "Lessee". Further the said clause do not indicate as to whether, future disputes also are to be referred to arbitration. In other words the said clause do not provide any details as to whether the disputes arising after the expiry of the contract and, or any other, future dispute between the parties could be referred for arbitration. The Apex Court in the case of UNION OF INDIA VS KISHORE - 31 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 LAL GUPTA AND BROS. reported in AIR 1959 SC 1362 (which is referred to in the case of M/s.Eigen Technical Services Private Limited supra) has held as under: "10. The following principles relevant to the present case emerge from the aforesaid discussion: (1) An arbitration clause is a collateral term of a contract as distinguished from its substantive terms; but nonetheless it is an integral part of it; (2) however comprehensive the terms of an arbitration clause may be, the existence of the contract is a necessary condition for its operation; it perishes with the contract; (3) the contract may be non est in the sense that it never came legally into existence or it was void ab initio; (4) though the contract was validly executed, the parties may put an end to it as if it had never existed and substitute a new contract for it solely governing their rights and liabilities thereunder; (5) in the former case, if the original contract has no legal existence, the arbitration clause also cannot operate, for along with the original contract, it is also void; in the latter case, as the original contract is extinguished by the substituted one, the arbitration clause of the original contract perishes with it; and (6) between the two falls many categories of disputes in connection with a contract, such as the question of repudiation, frustration, breach etc. In those cases it is the performance of the contract that has come to an end, but the contract is still in existence for certain purposes in respect of disputes arising under it or in connection with it. As the contract subsists for certain - 32 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 purposes, the arbitration clause operates in respect of these purposes. 11. We have held that the three contracts were settled and the third settlement contract was in substitution of the three contracts; and, after its execution, all the earlier contracts were extinguished and the arbitration clause contained therein also perished along with them. We have also held that the new contract was not a conditional one and after its execution the parties should work out their rights only under its terms. In this view, the judgment of the High Court is correct. This appeal fails and is dismissed with costs." 13. Reiterating the aforesaid principles of law laid down by the Apex Court, in the identical fact situation of the matter the High Court of Punjab and Haryana in the case of M/s.Eigen Technical Services Private Limited (supra) has also held that on expiry of the lease by efflux of time the arbitration clause contained therein would also stand perished. We are in agreement with the said proposition of law. 14. In the instant case the relief sought in the plaint, as already noted above, is apart from seeking direction to the appellant/defendant No.1 to deliver vacant possession of the suit schedule A' premises free from any obstruction from second and third respondents, the plaintiff has also sought for recovery of money towards unauthorized use and occupation of the premises after expiry of the lease period. That apart second and third respondents are the - 33 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 sub-lessees allegedly inducted by the appellant/first defendant into the premises and the said persons are not parties either to the lease deed or to the arbitration agreement. As already noted the arbitration clause also do not provide the scope and nature of the dispute to be referred for arbitration. 15. The reliance placed by the counsel for the appellant on the Judgment of the Apex Court in the case of VIDYA DROLIA AND OTHERS is of no avail, as in the instant case there is no subsisting arbitration agreement. Learned counsel could not point out if the disputes that the subject matter of the suit are envisaged to be resolved through Arbitrator under clause 22 of the lease agreement. Therefore the question of determination of prima facie existence of a valid arbitration agreement does not arise. For the aforesaid reasons and analysis we find no infirmity or illegality committed by the trial court in rejecting the application by its impugned order. Appeal lacks merit and stands dismissed.” 27. We are in full agreement with the view taken by the trial court, holding that the application filed under section – 8 of Act 1996 is not maintainable especially in - 34 - NC: 2025:KHC:13216-DB COMAP No. 313 of 2024 paragraph No.21. In these circumstances, the appeal fails as devoid of merit. Accordingly, we pass the following: ORDER i. The present appeal filed calling in question the order dated 05.06.2024, passed on I.A.No.1 filed under Section–8 of the Arbitration and Conciliation Act, 1996 in Com.O.S.No.835/2023, by the LXXXII Addl. City Civil And Sessions Judge, Bengaluru (CCH-83) vide Annexure-A is dismissed as devoid of merit. ii. In the facts and circumstances, costs made easy. iii. In view of dismissal of the appeal, I.A.No.1/2024 for stay, stands dismissed as infructuous. Sd/- (V KAMESWAR RAO) JUDGE Sd/- (T.M.NADAF) JUDGE JJ List No.: 1 Sl No.: 28