Section 9 of the Arbitration and Conciliation Act, 1996 vests wide powers with the Court for granting interim orders, at all stages of an arbitration proceeding: Delhi High Court.
Section 9 of the Arbitration and Conciliation Act, 1996 said that a party may, before or during arbitral proceedings or at any time after the making of the arbitral award but before it is enforced in accordance with section 36, apply to a court. The judgment was given by the High court of Delhi in the case of Narangs International Hostel private limited vs. Delhi International Airport Limited. Case No: [294/2021 &amp; I.A. 10860/2021] By the Hon’ble Mr. Sanjeev Narul Justice. The counsel for petitioner was Mr. Kapil Sibal &amp; Mr. Akhil Sibal and counsel for respondent represented by Dr. Abhishek Manu Singhvi, Senior Advocate with Mr. Anuj Berry, Mr. Chaitanya Safaya, Mr. Amit Bhandari and Ms. Prerna Acharya, Advocates. The International Airports Authority of India granted lease of airport land to NIHPL for the “purpose of carrying on flight catering business at the Delhi Airport, Palam” for a period of 30 years (ending on 31st August 2011), by way of a Lease Deed dated 20th August, 1982. Clause 19 of General Condition of contract contained an arbitration clause. DIAL became AAI’s successor-in-interest for the Original Lease Deed by way of an Operations, Maintenance and Development Agreement dated 04th April 2006, executed between AAI and DIAL, in respect of IGI Airport. The Original Lease Deed also provided “an option of extension upto 10 years” in its recital. A meeting was held between NIHPL, DIAL &amp; AAL where lease was extended for a period of 10 year. NIHPL contends that shortly thereafter, DIAL started pressurizing it to enter into a license agreement instead of the lease, and threatened to disallow access of airport to NIHPL for providing in-flight catering services. In 2016, once again, faced with DIAL’s denial of access to the Airport, NIHPL approached this court by way of a writ petition, which was disposed of by recording statement of DIAL that the Original Lease Deed stands extended till August 2021 and that DIAL would extend the necessary permits and passes for access to the Airport premises. The counsel for petition said that DIAL had been constantly pressurizing NIHPL to enter into a license agreement even the fact that DIAL &amp; NIHPL are signatories’ member wherein, the parties agreed to extend the original lease deed for a period of 10 year. Even after entering into the agreement dated 2009 as well as the SLA dated 17th May 2013 with NIHPL, DIAL has been taking a dishonest stand that there is no valid lease, and hence, NIHPL must enter into a license with DIAL on terms divergent from the subsisting lease. The counsel further stated that the livelihood of 1500 employees along with their families will be at stake, if relief is not granted to NIHPL with immediate effect. The counsel for respondent said that, there is unexplained delay and laches on the part of NIHPL in not approaching the court earlier. The counsel further said that the SLA is void and invalid, and thus NIHPL has no right to seek extension of the lease. The counsel said that in terms of Section 14(d) of the Specific Relief Act, 1963, a determinable contract cannot be specifically enforced, and therefore an interim injunction cannot be granted. The court analysis and find that, for grant of relief of injunction, the court is guided by the principles applicable to Order 39 Rules 1 &amp; 2 of the Code of Civil Procedure, 1908. In order to succeed, NIHPL has to meet the three-pronged tests of “(i) prima facie case, (ii) balance of convenience and (iii) irreparable harm or injury”. The Court must also be mindful that jurisdiction at the pre-arbitration stage is to be exercised only to ensure that an award passed by an Arbitrator should not be rendered in fructuous. In other words, interim order should only be passed in aid of the imminent arbitration proceedings. In order to agree on an extension, the parties have to imperatively arrive at a consensus on mutually agreed terms – i.e., the parties have to be ad idem. Clause 2 cannot be interpreted to mean that NIHPL can compel DIAL to sit at the negotiating table, much less enter into a contract. Parties have an opportunity to extend the lease on mutually agreed terms, but DIAL’s choice to not negotiate an extension is entirely its own business decision, and the court cannot compel it otherwise. DIAL cannot be compelled to enter into a contract, most certainly not by this court, while exercising jurisdiction under Section 9 of the Act. Even if that relief is left for adjudication in arbitration, in the absence of a prima facie right in favor of NIHPL, there is still no justification to be found to grant an interim relief of the nature as sought in the petition. The Court does not find any merit in the present petition and accordingly, the same is dismissed. The pending application also stands disposed of.
IN THE HIGH COURT OF DELHI AT NEW DELHI Date of Decision: 27th August 2021 O.M.P.(I)294 2021 & I.A. 10860 2021 NARANGS INTERNATIONAL HOTELS PRIVATE LIMITED ..... Petitioner Through: Mr. Kapil Sibal & Mr. Akhil Sibal Senior Advocates with Mr. Kshitiz Garg Mr. Anshum Jain and Mr. Rahul Kochal Advocates. DELHI INTERNATIONAL AIRPORT LIMITED ..... Respondent Through: Dr. Abhishek Manu Singhvi Senior Advocate with Mr Anuj Berry Mr. Chaitanya Safaya Mr. Amit Bhandari and Ms. Prerna Acharya Advocates. HON BLE MR. JUSTICE SANJEEV NARULA VIA VIDEO CONFERENCING] SANJEEV NARULA J.has been filed by the Lessee Narangs International Hotels Pvt. Ltd.seeking urgent interim relief against the Lessor Delhi International Airport Limited being aggrieved by DIAL’s email dated 02nd July 2021 asking NIHPL to initiate steps for vacation of DIAL’s premises in view of the expiry of lease on 31st August 2021. O.M.P.(I)294 2021 NIHPL seeks the following urgent reliefs: “[A] Direct that pending the adjudication of the arbitration proceedings between the Parties status quo as on date be maintained by the Parties regarding the flight catering operations of the Petitioner B] Restrain the Respondent from taking any coercive steps to impede the flight catering operations of the Petitioner including discontinuing issuance of necessary permits passes to its personnel vehicles for entry to the Airport premises or taking any steps to oust it from the leased land C] Pass ad interim ex parte orders in terms of the above prayers.” The facts leading to the filing of the present petition as narrated therein are briefly captured below: International Airports Authority of India granted lease of airport land to NIHPL for the “purpose of carrying on flight catering business at the Delhi Airport Palam” for a period of 30 years by way of a Lease Deed dated 20th August 1982 hereinafter referred to as ‘Original Lease Deed’]. Clause 19 of the General Conditions of Contract appended thereto contained an arbitration clause. 3.2. The Delhi Airport Palam Airport was renamed in 1986 as the Indira Gandhi International Airport(COMM.) 294 2021 Agreement dated 04th April 2006 executed between AAI and DIAL in respect of IGI Airport.3.4. The Original Lease Deed also provided “an option of extension upto 10 years” in its recital. Later as recorded in the minutes of meeting dated 27th November 2009 held between NIHPL DIAL and AAI the lease was extended for a further period of 10 yearson the basis whereof the Section 9 petition was withdrawn.1 The said agreement also contained an arbitration clause. 1 Order dated 20th May 2013 passed by a coordinate bench of this court in OMP No. 435 2013. O.M.P.(I)294 2021 In 2016 once again faced with DIAL’s denial of access to the Airport NIHPL approached this court by way of a writ petition which was disposed of by recording statement of DIAL that the Original Lease Deed stands extended till August 2021 and that DIAL would extend the necessary permits and passes for access to the Airport premises.2 In terms of clause 2 of the SLA the parties were to “discuss and mutually finalize the mode terms and conditions of the extension prior to the Term” of the SLA which is ending on 31st August 2021. Accordingly from 2019 onwards NIHPL addressed several letters inviting DIAL to discuss and finalize the extension to which it received no response. In 2021 yet another writ petition was filed by NIHPL in this Court seeking directions to DIAL to negotiate and arrive at an extension of the Original Lease Deed. The Court while adjourning the matter observed that the parties were free to discuss the extension in the 3.10. Thereafter in a meeting of the parties dated 07th May 2021 DIAL offered to enter into a license agreement with NIHPL for one year beyond August 2021 at the same monetary terms as the lease instead of proposing extension of the lease. 3.11. After various communications back and forth during the pendency of the above stated writ petition DIAL asked NIHPL to vacate vide email dated 02nd July 2021. 2 Order dated 28th August 2018 passed by a coordinate bench of this court W.P.(C.) 8768 2016. 3 Order dated 28.04.2021 passed by a coordinate bench of this Court in W.P.(C.) 3957 2021. O.M.P.(I)294 2021 3.12. NIHPL invoked arbitration vide notice dated 06th July 2021 and in view thereof withdrew the writ petition on 13th July 2021. However despite lapse of 30 days from the date of notice no response was received from DIAL. 3.13. Faced with the impending vacation of premises which is just 4 days away from today and aggrieved by DIAC’s lack of proposal for extension of lease for reasons elaborated in the contentions of the parties hereinafter NIHPL has filed the present petition for interim relief pending the formation of the Arbitral Tribunal. 4. Mr. Kapil Sibal and Mr. Akhil Sibal Senior Advocates who appear for NIHPL make the following submissions: 4.1. DIAL has been constantly pressurizing NIHPL to enter into a License Agreement with it notwithstanding the fact that DIAL and NIHPL are signatories to the minutes of meeting dated 27th November 2009 wherein the parties agreed to extend the Original Lease Deed for a period of 10 years and additionally a further extension post August 2021 was also contemplated. 4.2. Despite entering into the Agreement dated 2009 as well as the SLA dated 17th May 2013 with NIHPL DIAL has been taking a dishonest stand that there is no valid lease and hence NIHPL must enter into a license with DIAL on terms divergent from the subsisting lease. In 2016 NIHPL was compelled to approach this court for the second time 8768 2016] on account of DIAL’s withholding of entry of NIHPL’s personnel and vehicles at the Airport. In the court O.M.P.(I)294 2021 the AAI as Respondent No. 2 took the stand that it need not sign the SLA due to the terms of OMDA whereunder all future arrangements shall be entered into between only NIHPL and DIAL. The relevant portions of the orders dated 28th September 2016 and 28th August 2018 in W.P.(C.) 8768 2016 read as under: Order dated 28th September 2016: “Learned counsel for the petitioner contends that the petitioner is a lessee under Lease Agreement dated 20.8.1982 which was a lease for a period of 30 years with the option to the petitioner to have the same extended for a period of further 10 years. It is contended that the said option was exercised and by the Minutes of meeting dated 27.11.2009 the petitioner as also the respondents agreed to the extension of the lease for a further period of 10 years w.e.f. August 2011 to August 2021 on the same terms and conditions as also on the terms and conditions as modified therein. It is contended that subsequently a tripartite supplementary lease dated 17.05.2013 was prepared. However the Airports Authority of India till date has not signed the same though the same has been signed by the petitioner as well as by respondent instructions with regard to the signing of the said document.” Learned counsel for respondent No.2 prays for time to take Order dated 28th August 2018: alia praying as under: The petitioner has filed the present petition inter issuance of appropriate writ order or direction in the nature of mandamus or any other appropriate writ by directing the Respondents to issue to the Petitioner necessary vehicles permits passes ADP NOC permissions etc. for the access of personnel and vehicles at the IGI airport for providing in flight catering services upto 31.03.2017 in accordance with Lease deed dated 20th August 1982 as extended on 27th November 2009 ii)Issuance of appropriate writ order or direction in the nature of mandamus or any other appropriate writ by O.M.P.(I)294 2021 directing the Respondents not to withhold the entry of personnel or vehicles of the Petitioner at the IGI airport for providing in flight catering services in terms of lease deed dated 20th August 1982 as extended on 27th November Mr Tripathi learned Senior Counsel appearing respondent no.1 DIAL concurs with the submission that the lease dated 20.08.1982 stands extended till August 2021 in terms of the Minutes of the Meeting dated 27.11.2009. He further states that in view of the above the DIAL would extend the necessary vehicles permits and passes for granting access to the Airport premises. The learned counsel appearing for the Airport Authority of India also states that a decision has been taken that all arrangements ad agreements in future would be with the DIAL. Further the AAI has no objection to the above. In view of the above the petitioner’s grievance stands addressed. No further orders are required to be passed in this disposed of.” The petition and the pending application are accordingly 4.4. Thus the parties agreed without prejudice to act in terms of the SLA. Clause 2 thereof stipulates that parties will discuss and mutually finalize the mode terms and conditions of the extension prior to the Term for the period post August 2021. The effect scope and enforceability of this extension clause will be the subject matter of arbitration. For now the court can take note of the plain wording of the clause. It contemplates an extension of the existing lease. DIAL has not made any proposal for extension of lease and rather has proposed a license instead which is contrary to the understanding between the parties. 4.5. NIHPL is one of the pioneers of the flight catering business along with Taj and Oberoi carrying out its operations for the last 40 years O.M.P.(I)294 2021 employing thousands of personnel. In these circumstances the subject matter of the arbitration should be preserved at this stage by restraining DIAL from taking any coercive steps to oust NIHPL including denying requisite permissions to NIHPL’s personnel and vehicles for access to the Airport. 4.6. The livelihood of 1500 employees along with their families will be at stake if relief is not granted to NIHPL with immediate effect. 4.7. The balance of convenience lies in favour of NIHPL and irreparable loss and injury would be caused in case an interim relief is not It is not the case of NIHPL that it is claiming a right of automatic extension of the lease. However it is entitled to in terms of Clause 2 of the SLA to seek enforcement of it’s right to call upon DIAL to negotiate the mode terms and conditions of an extension. 4.9. Reliance was also placed on the judgment of the Supreme Court in Hardesh OresLtd. v. Hede & Co. 4 to contend that extension is different from renewal. In the case of renewal a new lease is required while in the case of extension the same lease continues in force for an additional period of time. The extension of lease also does not require any registered document to be executed. 4.10. Reliance was also placed on Section 14(3)(c)(ii) of Specific Relief Act 1963 as it was the prior to the 2018 Amendment to argue that the court can enforce specific performance in a case where the plaintiff has a substantial interest in the performance of the contract and the interest is of such a nature that compensation in money terms for non 4 2007 5 SCC 614 at para 29 and 30. O.M.P.(I)294 2021 performance of the contract is not an adequate relief. 5 Dr. Abhishek Manu Singhvi Senior Counsel for DIAL on the other hand strongly contested the present petition by making following 5.1. There is unexplained delay and laches on the part of NIHPL in not approaching the court earlier. On this ground alone the petition deserves to be dismissed. NIHPL knew all alongthat DIAL had an obligation to award a contract by way of tender in terms of Clause 8.5.7 of OMDA. Even then instead of availing judicial remedies it engaged in unnecessary correspondence and has approached this Court at the very last moment. In fact DIAL has not even received the purported notice of invocation dated 06th July 2021. 5.2. The SLA is void and invalid and thus NIHPL has no right to seek extension of the lease. This position has been accepted by NIHPL as evident from the order dated 28th August 2018 passed in W.P. 8768 2016. In terms of OMDA DIAL can only award a sub lease license of the premises to a party selected through a tender process. 5.4. The Clause 2 of the SLA does not give any automatic right of extension in favour of NIHPL. It only obligates the parties to discuss and mutually finalize the mode terms and conditions of the extension prior to the Term. Therefore no mandatory injunction can be granted 5 This contention made orally during the hearing does not form part of the written submission filed by O.M.P.(I)294 2021 at the interim stage to extend a lease expiring on 31st August 2021. Reliance is placed upon Indian Hotels Company Ltd. v. NDMC.6 5.5. DIAL is the best judge of its business operations. It is for DIAL to choose the number of sub contractors it should have at the IGI 5.6. DIAL in good faith and without prejudice to its rights made an ad hoc offer for a license to NIHPL which was expressly rejected. Multiple correspondences between the parties would show that NIHPL was unagreeable to enter into a fresh license for a period one year post the expiry of the present lease. The offer given by DIAL was expressly rejected by NIHPL who sought “a fair and reasonable proposal for the extension of the lease.” NIHPL wanted only an offer that suited itself which is against the basic tenets of mutual discussion and thus today this offer cannot be foisted upon DIAL as it lapsed as far back as on 02nd July 2021. In terms of Section 14(d) of the Specific Relief Act 1963 a determinable contract cannot be specifically enforced and therefore an interim injunction cannot be granted. Reliance is placed upon Royal Orchid Associated Hotels Private Limited v. Kesho Lal 5.8. There is a bar to arbitration under the Public Premises Act 1971. Clause 19 of the General Conditions of Contract appended to the Original Lease Deed specifically excludes disputes which fall within the purview of the 6 2016 SCC OnLine Del 5733. 7 2020 SCC OnLine Del 1708. O.M.P.(I)294 2021 said Act. Therefore the occupation of the subject premises by NIHPL post 31st August 2021 can only be decided under the Public Premises Act and hence the issues sought to be urged by NIHPL are not arbitrable. Relevant extract of Clause 19 of the General Conditions of Contract appended to the Original Lease Deed is extracted below: “19. All disputes and differences arising out of or in any way touching or concerning this agreement Act and the rules framed thereunder which are now in force or which may hereafter come into force are applicable shall be referred to the sole arbitrationprima facie case balance of convenience andirreparable harm or injury. The Court must also be mindful that jurisdiction at the pre arbitration stage is to be exercised only to ensure that an award passed by an Arbitrator should not be rendered infructuous. In other words interim order should only be passed in aid of the imminent arbitration proceedings. Although NIHPL is correct in saying that the scope effect and enforceability of the extension clause will be the subject matter of arbitration yet NIHPL has to certainly satisfy and establish a prima facie O.M.P.(I)294 2021 case and manifest the necessary ingredients enumerated above for grant of interim relief. To determine this the court has to examine the contractual obligations flowing from the agreements in question. Firstly DAIL has contended that the SLA is not a valid document and thus DIAL is not governed by the terms stipulated thereunder. In the opinion of the Court adjudication on this issue would require appreciation of evidence which however would only be feasible in arbitration. For now taking a prima facie view based on the stand taken by DIAL before a coordinate bench of this court in the order dated 28th August 2018 in W.P.(C.) 8768 2016 the court finds the SLA to be subsisting and thus governing the relationship between the parties. It is also undisputed that the arrangement recorded thereunder grants NIHPL the right to occupy the premises at IGI Airport till 31st August 2021. That said the next question that falls for consideration is the enforceability of NIHPL’s right under the terms of the SLA. For that let’s straightaway go to the SLA relevant clauses whereof are extracted SUPPLEMENTARY LEASE DEED “ As per the Original Lease Deed dated 20th August 1982 NIHPL had an option to renew the lease for a further period of 10years from 31 August 2011 till 31st August 2021 and the same option has been exercised by NIHPL. The Parties agreed and decided amongst other things in the Joint O.M.P.(I)294 2021 Meeting held on 27 November 2009 at New Delhi to renew and extend the lease of the premises for a further period of 10years effective from 31 August 2011 on the same terms and conditions as the Original Lease Deed save and except a Royalty(as defined hereinafter) of 13%of the Gross Turnover. The MOU dated 27.11.2009 is annexed as Schedule In view of the above it has been agreed between the Parties to execute this Supplementary Lease Deed to the Original Lease Deed in writing thereby extending the terms of the original lease deed by another 10 ten) years from 01 September 2011 to 31 August 2021 on the same terms and conditions as contained in the Original Lease Deed except as stated therein. NOW THEREFORE IN CONSIDERATION OF THE PROVISIONS AND MUTUAL COVENANTS CONTAINED HEREIN IT IS HEREBY AGREED BY AND BETWEEN THE PARTIES AS FOLLOWS: 2. The parties hereby extend the term of the Original Lease Deed for the period of 10years from 01 September 2011 to 31 August 2021(“Term”). For the period post 31 August 2021 the parties will discuss and mutually finalize the mode terms and conditions of the extension prior to the Term or such extended period agreed to between DIAL and NIHPL. 14. 14. This Deed shall expire automatically after the expiry of the Term unless terminated as provided in this Deed. termination and prior determination of the Term of this Deed shall be governed by the provision of the Original Lease Deed and this Deed. Without prejudice to AAI and or DIAL’s right to repossess the Leased Premises along with any building and structures thereon all other rights remedies and legal action if any on expiry termination or sooner determination of the Lease if NIHPL fails to hand over peaceful vacant possession of the Leased Premises then DIAL shall be entitled to not refund the Security Deposit till the Leased Premises is handed over to DIAL. DIAL shall charge the Rent along with simple interest at the rate of 18% per annum thereon till such time NIHPL handovers to DIAL the Leased Premises.” termination consequences of expiry emphasis supplied] O.M.P.(I)294 2021 10. Great emphasis has been laid by Mr. Sibal on Clause 2to contend that DIAL is contractually bound to necessarily come forward to join NIHPL on the negotiating table. The court is however unable to read any such enforceable right in favour of NIHPL in the manner of interpretation of clause 2 that is being urged by it. The aforenoted clause clearly defines the expiry of the term of the lease as 31st August 2021. It only envisages an option available to the parties to discuss the possibility of an extension prior to the termination of the period of the lease. While it undoubtedly also provisions for an extension in the future but that is with a caveat in case the parties may so desire upon mutual discussions. The court cannot read that as an absolute automatic or vested right of extension being carved out in favour of NIHPL. In order to agree on an extension the parties have to imperatively arrive at a consensus on mutually agreed terms i.e. the parties have to be ad idem. Clause 2 cannot be interpreted to mean that NIHPL can compel DIAL to sit at the negotiating table much less enter into a contract. Parties have an opportunity to extend the lease on mutually agreed terms but DIAL’s choice to not negotiate an extension is entirely its own business decision and the court cannot compel it otherwise. A binding agreement can only come about if the earlier agreement is renewed on mutually agreed terms in the absence whereof the term of SLA is bound to terminate on the stipulated date. In fact Mr. Sibal has categorically stated that he is not claiming an automatic right of extension. He has painstakingly taken the court through the documents on record to demonstrate that the conduct of DIAL has been dishonest and that they have not come forward to negotiate the terms of O.M.P.(I)294 2021 extension of the lease. He has relied upon the email dated 13th May 2021 to argue that DIAL has instead offered to allow NIHPL to continue in the premises subject to the execution of a year long license agreement. During the course of the arguments a specific query was put to Dr. Singhvi as to whether the offer made by DIAL in the aforenoted email was still open i.e. whether DIAL was still desirous of entering into a fresh Licence Agreement with NIHPL. In response thereto Dr. Singhvi took the Court through several correspondences between the parties subsequent the aforenoted communication and stated that the offer stood lapsed as far back as 2nd July 2021 in terms of the conduct of and laches on part of NIHPL. 12. These communications being an accurate account of the events that transpired give us an insight into NIHPL’s stand regarding DIAL’s offer of entering into a fresh Licence Agreement. It would thus be apposite to refer to the email dated 14th May 2021 which is the first response of NIHPL to the offer noted above. The same is extracted herein below: “From: Ambassador’s Sky Chef <dfk@ambassadorindia.com> Sent: 14 May 2021 19:12 To: ‘Sanjiv Edward’ <Sanjiv.Edward@gmrgroup.in> CC: ‘Ashish Batra’ <Ashish.Batra@gmrgroup.in> ‘Beena Patwal’ Subject: RE: Your email dated 26.04.2021 regarding lease deed dated 20.08.1982 and MoU dated 27.11.2009 and order dated 28.08.2018 passed by the Hon’ble High Court Dear Sanjeev Thank you for email dated 13th May 2021 along with the attached minutes of the discussions we had via Zoom last Friday. At the outset I would like to bring to your notice that during our discussions last Friday I had clearly explained to you and your team that our subsisting Lease Deed dated 17th May 2013 has a specific clausefor extension of the existing lease post 31st August 2021. The said clause provides for the Parties to discuss and mutually finalise the mode terms and conditions of the extension of the lease. In view of this clause I had O.M.P.(I)294 2021 explained that Ambassador Sky Chef stood on a entirely different footing as compared to the other flight catering units at Delhi and any tender that you may come up with for appointment of new flight kitchen concessionaire would not be applicable to us. As such the only thing that remains is for us to discuss and mutually finalise fair and reasonable terms for the extension of our existing lease. In addition please note that Clause 2 of the Lease Deed dated 17th May 2013 provides for an “extension” of the subsisting lease and hence there is no question of having it converted into a license. Thus DIAL is contractually obligated to extend the lease and not convert it into a License. As stated during our meeting on 07th May 2021 and in my email dated 11th May 2021 in the present scenario even the most optimistic projections do not envisage a revival of domestic or international traffic of at least another 4 5 years. Given the losses we have suffered and continue to suffer since the outbreak of the Corona virus pandemic along with the difficulties faced in collecting our old outstanding dues including the GST Revenue Share paid to DIAL TDS etc. all paid by us from our own pocket a complete revival of the business is necessary which would require a considerable period of time. This will not be possible with a shorter term lease as on the one hand we have to invest substantial sums into the upgradation of the existing flight catering unit to prevent the spread of COVID as also ensure compliance with enhanced hygiene standards and on the other all airlines insist on a minimum 5 year residual land lease period before renewing or entering into fresh catering contracts. In view of the above and also considering the stiff competition that we will face from new airports opening in the vicinity including the Jewar airport your proposal for a one year extension is neither commercially feasible or nor financially viable and is contrary to the spirit of the long and cordial relationship that we enjoy. We again request you to reconsider your proposal and let us have you offer for extension of the lease for a much longer period and on far more favourable terms and conditions than the present terms considering the financial crisis that our business is facing and is likely to continue to face in the near future. Best Regards Murali Krishnan” 13. The above email reveals that NIHPL has been looking for an offer that suits them on their terms. Subsequent email communications also narrate the same story. The relevant part of a few of such communications are extracted herein below: O.M.P.(I)294 2021 i) Email dated 21st May 2021: “From: Ambassador’s Sky Chef <dfk@ambassadorindia.com> Sent: 21 May 2021 15:17 To: ‘Sanjiv Edward’ <Sanjiv.Edward@gmrgroup.in> CC: ‘Ashish Batra’ <Ashish.Batra@gmrgroup.in> ‘Beena Patwal’ Subject: RE: Your email dated 26.04.2021 regarding lease deed dated 20.08.1982 and MoU dated 27.11.2009 and order dated 28.08.2018 passed by the Hon’ble High Court Dear Sanjiv This is further to my trailing email dated 14th May 2021. As explained in my email clause 2 of the Supplementary Lease Deed dated 17th May 2013 requires us to discuss and mutually finalise the mode terms and conditions of the extension of our subsisting lease for the period post 31st August 2021 prior to the expiry of the terms of the subsisting lease i.e. on 31st August 2021. As you are aware we have been continuously requesting for a meeting to discuss and conclude the terms of the extension since last over 2.5 years. In view of the prevailing circumstances as explained in my various communications to you including my email dated 14th May 2021 we await your fair and reasonable proposal for such extension. Considering the paucity of time and the urgency of the matter we again request you to kindly send us your revised proposal at the earliest so that the terms and conditions for the extension of the lease can be agreed and finalized sufficiently prior to the expiry of the existing lease on 31st August Thanking you. Best Regards Murali Krishnan” ii) Email dated 28th May 2021: “To: ‘Sanjiv Edward’ <Sanjiv.Edward@gmrgroup.in> Cc: ‘Ashish Batra’ <Ashish.Batra@gmrgroup.in> ‘Beena Patwal’ Subject: RE: Your email dated 26.04.2021 regarding lease deed dated 20.08.1982 and MoU dated 27.11.2009 and order dated 28.08.2018 passed by the Hon’ble High Court Dear Sanjiv At the outset we state that we have not made any insinuations which are contrary to the factual and legal position and deny all contentions and O.M.P.(I)294 2021 allegations made by you which are contrary to or inconsistent with what has been stated by us in regard to the subject matter. We reiterate that in terms of Clause 2 of the Supplementary Lease Deed dated 17th May 2013 we are entitled to an extension of our subsisting lease of the period post 31st August 202 1 prior to the expiry of the term of the existing lease i.e. 31st August 2021. The extension clause thus provides for extending the subsisting lease on fair and reasonable terms and not conversion of the lease into a license. We are not opposed to your issuing a competitive tender for appointing a new IFK concessionaire at the IGI Airport. However the issuance of such tender and appointment of a new IFK concessionaire at the IGI Airport has no relation to or bearing on the extension of our subsisting lease. In view of what is stated above and in our earliest emails we again request you to send us your fair and reasonable proposal for the extension of the subsisting lease post 31st August 2021. Considering the paucity of time and urgency of the matter we request for your immediate action on the same. Thanking you. Best Regards Murali Krishnan Vice President” iii) Email dated 7th June 2021: “From: Ambassador s Sky ChefSent: Monday June 7 2021 5:03 PM To: Sanjiv Edward CC: Ashish Batra Beena Patwal Subject: RE: Your email dated 26.04.2021 regarding lease deed dated 20.08.1982 and MoU dated 27.11.2009 and order dated 28.08.2018 passed by the Hon ble High Court Dear Sanjiv Further to our trailing email dated 28th. May 2021 considering the urgency of the matter and the paucity of time available we request you to kindly send your fair and reasonable proposal for extension of the subsisting Supplementary Lease Deed dated 17th. May 2013 for the period post 31st.August 2021 at your earliest. Best Regards Murali Krishnan Vice President” iv) Email dated 15th June 2021: O.M.P.(I)294 2021 “From: Ambassador’s Sky Chef <dfk@ambassadorindia.com> Sent: 15 June 2021 16:00 To:‘Sanjiv.Edward@gmrgroup.in’ <Sanjiv.Edward@gmrgroup.in> CC: ‘Ashish.Batra@gmrgroup.in’ <Ashish.Batra@gmrgroup.in> ‘Beena.Patwal@gmrgroup.in’ <Beena.Patwal@gmrgroup.in> Subject: RE: Your email dated 26.04.2021 regarding lease deed dated 20.08.1982 and MoU dated 27.11.2009 and order dated 28.08.2018 passed by the Hon’ble High Court Dear Sanjiv Thank you for your email dated 10th June 2021. We note with regret and disappointment your refusal to comply with your obligations under the Supplementary Lease Deed dated 17th May 2013 and particularly Clause 2 thereof. We reiterate that the offer made by you pursuant to the discussions held on 7th May 2021 is neither fair nor reasonable and is not in compliance with your obligations under the Supplementary Lease Deed. As stated earlier Clause 2 of the Supplementary Lease Deed specifically requires us to discuss and mutually finalise the mode terms and conditions of the extension of our subsisting lease for the period post 31st August 2021 prior to the expiry of the subsisting lease on 31st August 2021. DIAL is therefore contractually obligated to extend the existing lease and not convert it into a license as proposed by you. As mentioned in our earlier emails it will take at least another 4 to 5 years for revival of domestic and international air passenger traffic and consequently the flight catering business which has suffered and continues to suffer heavily on account of the outbreak and spread of the coronavirus pandemic. A short term lease or a one year license as proposed by you is the present circumstances given the long time period that will be required to recoup the losses incurred over the last one and half years of the pandemic as well as the investments made to upgrade the hygiene and food safety standards of the flight catering unit to prevent the spread of Covid pandemic. In addition you are aware that all airline catering contracts are for a period 3 5 years and that they insist on a minimum five year residual land lease before renewing or entering into fresh catering contracts. Although DIAL is a signatory to OMDA it has subsequently executed the Supplementary Lease Deed dated 14th May 2014 with Narangs International Pvt. Ltd. The said Supplementary Lease Deed contains an extension clause i.e. Clause 2 as per which DIAL is obligated to extend the aforesaid Lease Deed by way of a fresh lease on fair and reasonable terms prior to 31st August 2021. To the best of our knowledge OMDA does not bar or prohibit DIAL from extending existing leases and ensuring the continued performance of its obligations. We reiterate that the provisions of Clause 2 of the Supplementary Lease fair and reasonable or commercially viable O.M.P.(I)294 2021 Deed dated 17th May 2013 not only confers a right in our favour to seek an extension of the subsisting lease but also casts an obligation on DIAL to extend the existing lease on fair and reasonable terms prior to 31st. August We are unable to understand your statement in the last para of your aforesaid email “so that further action can be taken at the earliest for the continuity of services to the Airlines” and request you to clarify the same. We once again request you to reconsider your earlier proposal and send us a fair and reasonable proposal for the extension of the lease to enable us to conclude the matter at the earliest prior to 31st. August 2021 as required under the terms of the Supplementary Lease Deed. Thanking you Yours sincerely Best Regards Murali Krishnan Vice President” 14. The above quoted mails establish that although NIHPL sought extension of the lease for a prolonged time it was not agreeable to a license agreement. This stance of NIHPL is certainly against the tenets of mutual discussion. The terms offered by DIAL were not acceptable to it and were rejected on the basis of its commercial wisdom. It insisted on a lease agreement which DIAL refused to countenance by citing restrictive provisions of the OMDA. DIAL’s stand has been explicit yet NIHPL continued to flog the proverbial dead horse by engage back and forth with its correspondence. The mutual negotiation thus failed much earlier in time yet NIHPL preened itself to be hopeful and did not relent. Now when the realisation has dawned on it that the term of the lease is going to expire in 4 days it has spurred into action at a much belated stage. 15. Mr. Sibal had argued that the terms of the proposed license agreement are not at variance with the lease and thus the court may direct that the parties can without prejudice to their rights and contentions continue under O.M.P.(I)294 2021 license subject to final adjudication of the claim before the Arbitral Tribunal. This prayer appears to be appealing but unfortunately it is without any contractual foundation. The date of expiry of the agreement has been set. Adherence to contracted terms is the prime factor in any contractual relationship. DIAL cannot be compelled to enter into a contract most certainly not by this court while exercising jurisdiction under Section 9 of the Act. Even if that relief is left for adjudication in arbitration in the absence of a prima facie right in favour of NIHPL there is still no justification to be found to grant an interim relief of the nature as sought in the petition. The terms of the SLA have to spell out some enforceable right in favour of NIHPL and a corresponding obligation on DIAL for NIHPL to be entitled to the relief of injunction. Just because disputes have arisen and that would require adjudication by the Arbitral Tribunal does not necessarily invite an interim order. 16. The terms of the SLA do not create a vested right in favour of NIHPL. The terms of the SLA could only have been relied upon for initiating a negotiation. That cannot however mean that DIAL has to be compelled to choose its vendors. Negotiation as noted above has been in vain for the last two years as it manifests from the correspondence placed on record. The court also finds merit in the contention of DIAL that it is the best judge of the business operations it seeks to conduct at the IGI Airport and it is for DIAL to choose how many sub contractors it should have at the Airport. Therefore in the opinion of the Court NIHPL has not made out any outline of a prima facie case balance of convenience or irreparable loss in its O.M.P.(I)294 2021 17. Section 14 of the Specific Relief Act 1963 as substituted vide its 2018 Amendment enumerates contracts which cannot be specifically enforced. One such category of contracts given in Sub section is a contract which by its very nature is determinable. This court in its prima facie opinion finds the present lease being of a specified term to be determinable in nature. This is also evident from clause 5 of the Original Lease Deed which reads as under: In the event of any default failure negligence or breach in the opinion of the Authority on the part of the Lessee in complying with all or any of the condition mutually agreed between the parties the Authority shall be entitled and be at liberty to determine the lease forthwith and resume possession of the premises wherever provided without payment of any compensation or damages and also forfeit in full or in part the amount deposited by the Lessee for the due performance of the agreement.” sic)18. Futher as NIHPL has failed to establish a case for grant of interim relief no need is felt to examine and determine the question of arbitrability of disputes in the context of bar under the Public Premises Act. 19. Even under the Specific Relief Act 1963 the contentions of NIHPL are not merited. As the contract is determinable it cannot be specifically enforced thus the nature of injunction sought by NIHPL for restraining its ouster from the premises cannot be granted under Section 41(e) of the Specific Relief Act 1963. NIHPL cannot claim injunction in the nature of specific performance once the agreement has expired by efflux of time. 20. Before parting the court must also record that NIHPL has been in O.M.P.(I)294 2021 occupation of the premises for a long period of four decades. Its status under the Original Lease Deed as well as the SLA acquired upon gaining entry to the premises is at the highest that of a ‘tenant’. Thus there is no right in favour of NIHPL to occupy the premises or continue as a lessee in perpetuity. The right to seek extension has to be construed consistent to and in accordance with the covenants of the lease deed which requires DIAL’s consent. In this regard there is no ambiguity. DAIL’s refusal to extend the lease licence on the ground that it has an obligation to award contract by way of tender in terms of Clause 8.5.7 of OMDA cannot be called unfair or arbitrary even if one applies that yardstick which is although not strictly applicable in commercial matters. DIAL’s insistence on adhering to the conditions of OMDA must also not be brushed aside lightly. Resorting to public auction is indeed universally recognized as the most apposite method that subserves public interest promotes transparency public participation fair price maximization of revenue and promotes fair competition. Thus on aspect as well the Court does not find any right to have accrued in favour of In view of the foregoing the Court does not find any merit in the present petition and accordingly the same is dismissed. The pending application also stands disposed of. AUGUST 27 2021 SANJEEV NARULA J O.M.P.(I)294 2021 