Delhi Court | “Mere temporary non-use of premises cannot be covered under Force Majeure clause”; Miniso to pay rent arrears for lockdown and post lockdown period

District Court, Saket, Delhi: Raj Kumar Chauhan, J., directed “Miniso” to pay the rent arrears for the lockdown and post lockdown period stating that the company has no dearth of money as the company has been operating almost 10 similar premises on rent in Delhi successfully.

Lease

Allegations placed by the petitioners are that they had leased their property to respondent i.e. Miniso Life Style Private Limited.

Monthly Rent

Monthly rent of the leased out property was Rs 9,75,000/- plus GST per month and the same was to be paid in equal proportions to lessor 1, 2 and 3 as per the agreement signed between the parties.

Head of Business Development of Miniso i.e. respondent asked the petitioner to consider the waiver of rent for the time period of lockdown — April, 2020 to May, 2020.

Further, the petitioner informed the respondent that as per clause 12 of the agreement i.e. Force Majeure Clause was not applicable to the existing circumstances and respondent cannot take unjust and wrongful benefit of said clause.

Though the petitioners agreed to waive the penal interest on the delayed payment @18% p.a. but the respondent continued to threaten for creating third party interest in the demised premises.

Petitioners were represented by Counsels Gaganmeet Singh Sachdeva, Sumit Thakur and Counsel for the respondent was Akash Tyagi.

Legal Notice

Petitioners had to in view of the above circumstances send a legal notice for recovery of rent and arrears on 23-05-2020.

Later the respondent sent a proposal of paying 70% of the arrears of rent for the month of April and 90% of the rent for June and July, 2020.

Petitioners in good­faith and trust sent the invoices of the rent for the above stated months and requested the respondent to pay the payment after deducting 15% rebate for arrears of rent for April, May, alongwith rent of June and July.

Despite sharing the invoice the respondent did not clear the arrears of rent and stopped taking calls from the petitioners.

In view of the above circumstances, the present petition was filed.

Respondents contention was with regard to the maintainability of the petitions stating that Clause 12 of the Lease Deed provides eventualities wherein in case the demised Premises is, whether fully or partially, destroyed or damaged by any Act of God, such as by flood, earthquake, storm etc. save and except fire, becomes unfit for occupation or use, the rent payable by the respondent shall be suspended till such time as the Demised Premises is once again rendered fit for use and occupation by the respondent.

Counsel for the Petitioners relied upon the decision in, Sona Corporation India (P) Ltd. v. Ingram Micro India (P) Ltd., O.M.P (COMM.) 249/2018 and Ramanand v. Dr Girish Soni, R. C. Rev. No. 447 of 2017.

The above two cases were cited with respect to the contentions that Court under Section 9 of the Arbitration Act can direct the payment of rent due as well as future rent in the same manner as the Court can grant in a civil suit under Order 39 Rule 10 CPC.

Adding to the above, the latter case was relied upon to rebut the respondent’s claim for waiver of rent.

Decision

Bench on perusal of the referred provisions and sections of Arbitration Act and CPC held that the respondents are directed to pay admitted rent to the petitioner for the period which has not been paid for the leased premises alongwith future payment also be paid as per the lease deed.

Further, adding to its analysis of the facts, Court stated that on perusal of the force majeure clause in the agreement, it can be stated that the lessee is entitled to suspension of the rent only if the property has been damaged or destroyed by any force Majeure event.

Admittedly, the property in question has not been damaged/destroyed in force majeure event.

Hence, in view of the law laid down by Delhi High Court in the decision of Sona Corporation India (P) Ltd. v. Ingram Micro India (P) Ltd., O.M.P(COMM.) 249/2018 and Ramanand v. Dr Girish Soni, R. C. Rev. No. 447 of 2017, Court concluded its decision stating that,

“mere temporary non-use of the tenanted premises by the respondent and yet being in power and possession of the premises in view of the temporary lockdown due to the COVID-19 Pandemic, the said event cannot be covered under the force Majeure clause of the lease agreement.”

Therefore, the respondent cannot claim waiver of rent.

Hence the Court is empowered under Section 9 of the Arbitration Act to order payment of arrears of rent for the lockdown period and also post lockdown period.

In view of the above terms, petitions were disposed off. [Uma Sharma v. Miniso Life Style (P) Ltd., 2020 SCC OnLine Del 979, decided on 06-08-2020]

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