Are tenancy-related disputes arbitrable?

The Transfer of Property Act, 1882 (act), provided a general legislation regarding the transfer of immovable properties and interests. Subsequently, with the view of specifically regulating tenancy relationships, primarily to control inflated rentals and illegal dispossession of tenants, rent control legislations were passed in several countries, including in India, especially after the Second World War.

Tenancy-related disputes have seen a huge increase in in India and these notorious of being long drawn and slows down the courts significantly. Rent control legislations also resulted in a decrease in the quality of leasing in general. Several states, therefore, amended the scope of rent control legislations, limiting them to certain well-defined parameters. Tenancy disputes not falling within the ambit of the rent control legislations were usually filed under general provisions of applicable laws.

After liberalization, India has seen the emergence of large commercial projects. Given the commercial nature of these leasing transactions and the huge financial implications involved, parties usually concurred to resolution by arbitration.

But as the Arbitration and Conciliation Act, 1996, does not have specific provisions excluding any category of disputes as non-arbitrable, the Supreme Court and various high courts have held tenancy and eviction matters to be non-arbitrable.

Gerald Manoharan is a partner and Vishnu Vinayak is a junior associate in the Bengaluru office of J. Sagar Associates. Their views are personal.

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Gerald Manoharan| Tel: +91 80 435 03610
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Vishnu Vinayak | Tel: +91 80 435 03623
Email: vishnu.vinayak@jsalaw.com
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