Court emphasizes waiver doctrine in landlord-tenant arbitration dispute under Rajasthan Rent Control Act
In a significant judgment, the Rajasthan High Court in the case of "Legal Representatives of Late Ramesh Chandra Patel v. City Pulse Enterprise Private Limited" has reinstated an arbitral award that was previously quashed by the Commercial Court, Udaipur. The High Court underscored the principle of waiver and estoppel in arbitration proceedings, asserting that a party cannot challenge the jurisdiction of an arbitrator if it failed to raise objections during the arbitration process.
The dispute involved a landlord-tenant relationship, which under the Rajasthan Rent Control Act, 2001, is deemed non-arbitrable and falls within the exclusive jurisdiction of the Rent Tribunal. However, the respondent, City Pulse Enterprise, having participated in the arbitration without raising jurisdictional objections, was deemed to have waived its right to contest arbitrability at a later stage under Section 34 of the Arbitration and Conciliation Act, 1996.
The Court, comprising Justices Arun Monga and Sandeep Shah, emphasized that despite the non-arbitrability of the dispute, the respondent's active participation and consent to the arbitration proceedings precluded it from challenging the arbitral award on jurisdictional grounds. The judgment also clarified that the mandate of an arbitrator could be extended post-award under Section 29A of the Act, thus maintaining the award's validity pending such extension.
Bottom line:-
Arbitration - Dispute involving landlord-tenant relationship under the Rajasthan Rent Control Act, 2001 is non-arbitrable and falls exclusively within the jurisdiction of the Rent Tribunal. However, a party that consents to arbitration, participates in proceedings, and raises no jurisdictional objection during the arbitral process is deemed to have waived its right to challenge arbitrability at a later stage.
Statutory provision(s): Arbitration and Conciliation Act, 1996 Sections 4, 16, 34, 29A; Rajasthan Rent Control Act, 2001 Sections 18, 29
