PARSVNATH ESTATE DEVELOPERS PVT LTD  Vs FACEBOOK INDIA ONLINE SERVICES PVT LTD

ARB.P. 31/2021 and contd. matter Page 1 of 8
$~5 and 6
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Decided on 7th January, 2021
+ ARB.P. 31/2021
PARSVNATH ESTATE DEVELOPERS PVT LTD. Petitioner
Through: Mr. Vijay Nair, Mr.
Manoranjan Sharma, Mr. Varun Garg and
Mr. Rishu Kant Sharma, Advs.

versus

FACEBOOK INDIA ONLINE
SERVICES PVT LTD ….. Respondent
Through: Mr. Tejas Karia, Mr. Varun
Pathak, Mr. Gauhar Mirza, Ms. Nayantara
Narayan, Mr. Shyamal Anand and Mr.
Thejesh Rajendran, Advs.
AND

+ OMP(I)(COMM) 2/2021
FACEBOOK INDIA ONLINE SERVICES PVT LTD THROUGH ITS AUTHORISED SIGNATORY
MS. SANJH PUROHIT ….. Petitioner
Through: Mr. Tejas Karia, Mr. Varun
Pathak, Mr. Gauhar Mirza, Ms. Nayantara
Narayan, Mr. Shyamal Anand and Mr.
Thejesh Rajendran, Advs.

Versus

PARSVNATH ESTATE DEVELOPERS PVT LTD.
THROUGH ITS AUTHORISED REPRESENTATIVE MR. VIVEK GARF …Respondent
Through: Mr. Vijay Nair, Mr.
Manoranjan Sharma, Mr. Varun Garg and
Mr. Rishu Kant Sharma, Advs.
2021:DHC:58ARB.P. 31/2021 and contd. matter Page 2 of 8
CORAM:
HON’BLE MR. JUSTICE C. HARI SHANKAR

O R D E R (ORAL)
% 07.01.2021
(Video-Conferencing)

C .HARI SHANKAR, J.

IA 193/2021 and 151/2021

1. Allowed, subject to all just exceptions.

2. The applications stand disposed of.

ARB.P. 31/2021 and OMP(I)(COMM) 2/2021

1. Arb. P. 31/2021 and OMP (I) (COMM) 2/2021 arise out of a
Sub-License Agreement and a Maintenance Agreement, executed on
11th May, 2017 between Facebook India Online Services Pvt. Ltd.
(hereinafter referred to as “Facebook”) and Parsvnath Estate
Developers Pvt. Ltd. (hereinafter referred to as “Parsvnath”) .

2. Under the said agreements, Parsvnath granted Facebook the
license to use and occupy the office space, located at the 7th Floor,
Commercial Complex, owned by Parsvnath and undertook to provide
certain maintenance services and utilities. The terms of the agreements were to continue from 1
st April, 2017 till 31st
3. Facebook claims to have deposited the security deposit of ₹
4,58,39,904/ -, under the aforesaid agreements. March, 2020.

2021:DHC:58ARB.P. 31/2021 and contd. matter Page 3 of 8

4. That the agreements came to an end on 31st March, 2020, it
appears, is not in dispute. The grievance of Facebook as ventilated in
OMP (I) (COMM) 2/2021 appears to be that Parsvnath is not
refunding the security deposit, deposited by Facebook, despite expiry
of the aforesaid two agreements, and that certain amounts were deducted by Parsvnath from the said security in violation of Clause 4.3
of the Sub -License Agreement.
5. Facebook contends that though C lause 4.3 read with 13.6 of
Sub License Agreement requires handing over peaceful and vacant
possession of the premises by Facebook to Parsvnath on or before 31
st
March, 2020, it was unable to do so owing to intervention of the COVID-2019 pandemic and consequent lockdown imposed by the Government. Consequent to lifting of the lockdown, however, it is submitted that Facebook was ready and willing to handove r the
premises to Parsvnath since 3
rd
7. Parsvnath, on the other hand, contends in its petition under
Section 11 of the Arbitration and Conciliation Act, 1996 (hereinafter June, 2020 and Parsvnath is not taking
possession thereof and is insisting on continued payment of rent by
Facebook.

6. Facebook also takes exemption to the charging of maintenance
fees, sub -license fees and car parking fees by Parsvnath, during the
period from March to May, 2020, when the lockdown was in force, as
well as charging of electricity charges for the month of April, 2020.

2021:DHC:58ARB.P. 31/2021 and contd. matter Page 4 of 8
referred to as “1996 Act”) (Arb. P. 31/2021) that Fac ebook has
defaulted in granting peaceful and vacant possession of the premises
to Parsvnath by 31st March, 2020 and has not tendered any satisfactory
explanation for not paying sub- license fees to Parsvnath after March,
2020. It is also urged by Parsvnath that Facebook continues to remain
in illegal possession of the premises of the Parsvnath till date, and that
considerable amounts remain to be paid by Facebook to Parsvnath.
Mr. Tejas Karia, learned counsel for the Facebook and Mr. Vijay Nair,
learned co unsel for the Parsvnath, submit that Facebook’s claims
against Parsvnath are in the region of ₹4.5 crores, whereas Parsvnath’s
claims against Facebook, after adjustment of security deposit, are in
the region of ₹5.3 crores.
8. Clearly, there are arbitrable disputes between the parties.
9. In these circumstances, Facebook has moved OMP (I) (COMM)
2/2021 before this Court seeking certain pre arbitral interim reliefs.
10. Parsvnath has moved Arb. P. 31/2021, seeking appointment of
an arbitrator to arbitrate on the aforesaid disputes under Section 11(6)
of the 1996 Act.

11. Clause 17.10 of the Sub-L icense Agreement, dated 23
rd
“17.10 In the event of any and all disputes, controversies or
differences which may arise between the Parties out of or in August,
2017 provides for arbitration to resolve the dispute between Facebook
and Parsvnath and reads thus:

2021:DHC:58ARB.P. 31/2021 and contd. matter Page 5 of 8
relation to or in connection with this Agreement, the
interpretation thereof, or its breach ( collectively referred to
as the “Dispute”), the authorized representatives of the
Parties shall first attempt to resolve the Dispute by mutual
discussions and agreement. If the Dispute is not resolved
within 30 (thirty) days of the Parties attempting to resolve the
same, the Dispute shall then be referred to a binding
arbitration, with the procedural law of such arbitration
governed by the Arbitration and Conciliation Act, 1996, as
amended from time to time. The Parties shall mutually
appoint a single arbitrator, who shall be a retired judge of the
Supreme Court/High Court or an arbitrator from the panel of
arbitrators appointed by the Supreme Court/High Court of
Delhi, within a period of 15 (fifteen) days (“Fifteen Day
Period”) of a written notice by any Party (“Dispute
Notice”). The venue of the arbitration shall be New Delhi,
India. The fees of the arbitrator and expenses shall be borne
by the Parties in equal percentages or as provided by the
tribunal in the arbitration award. Each side will, in the event
that no costs are awarded, bear their respective attorney’s costs. The language of arbitration shall be English. The law
governing the arbitration shall be Indian law. The award shall
be binding on the Parties hereto. Judgment on the award shall
be enforced by any court of competent jurisdiction.
Notwithstanding the aforesaid during the pendency of the
arbitration proceedings the Parties shall be liable to perform
all its obligations and comply with all its covenants specified
in this Agreement except where such covenant is the subject
matter of arbitration.”

12. Clause 14.1 of the Maintenance Agreement makes Clause 17.10
of the Sub-License Agreement applica ble to the Maintenance
Agreement. As such, both the agreements are governed by the same arbitration clause.

13. Learned counsel for the parties have not been able to arrive at a
consensus regarding the name of the arbitrator to arbitrate on the
dispute between them.
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14. It is in these circumstances that Parsvnath has filed Arb. P.
31/2021 under Section 11(6) of the 1996 Act, seeking intervention of
the Court for appointment of an appropriate arbitrator to arbitrate on
the dispute between the parties.
15. Mr. Karia, learned counsel for Facebook, is agreeable to the
appointment of the arbitrator by the Court, and to OMP (I) (COMM)
2/2021 being treated as an application under Section 17 of the 1996 Act, to be decided by the learned sole arbitrator. He, how ever,
submits that he is seeking appointment of a receiver to take possession
of the premises in his client’s occupation and that, owing to his
remaining continued in possession of the premises and Parsvnath
allegedly, not taking possession thereof, t he cl aim of Parsvnath against
Facebook is increasing substantially, month by month.

16. Needless to say, Facebook denies the validity of the claim.

17. The a bove submission of Mr. Karia is noted. It shall remain
open to Facebook to impress, on the learned s ole arbitrator being
appointed by the present order, the urgency of deciding the issue raised in OMP (I) (COMM) 2/2021, consequent to treat ing it as an
application under Section 17 of the 1996 Act. This Court has no doubt that the learned sole arbitrator would deal with the matter with the
urgency it deserves.
18. In view of the above, this Court appoint s Hon’ble Mr Justice
2021:DHC:58ARB.P. 31/2021 and contd. matter Page 7 of 8
K.S. Radhakrishnan, an eminent former Judge of the Supreme Court
of India , as the sole arbitrator to arbitrate on the dispute between the
parties. The contact details of the learned sole arbitrator are provided
as under:

Hon’ble Mr. Justice K.S. Radhakrishnan
Former Judge, Supreme Court of India,
87, Anand Lok, 2nd Floor,
NEW DELHI – 110049

Phone No. 9560013636
Email ID : jusksr@gmail.com

19. OMP (I) (COMM) 2/2021 would be treated as an application
under Section 17 of the 1996 Act, and decided by the learned
arbitrator in accordance with law.

20. The parties may contact the learned sole ar bitrator at the
aforesaid contact details within 48 hours of receipt by email of the
copy of the present order by the Registry of this Court. The Registry
is directed to email a copy of this order to both parties as expeditiously as possible, as soon as i t is available, so that the arbitral proceedings
could take off immediately thereafter.
21. The l earned arbitrator would file the requisite disclosure under
Section 12(2) of the 1996 Act within a week of entering on the
reference.

21. The f ees of the learned arbitrator shall be determined by the
2021:DHC:58ARB.P. 31/2021 and contd. matter Page 8 of 8
learned arbitrator in consultation with the parties .

22. In order to expedite the adjudication of the prayers contained in
OMP (I) (COMM) 2/2021 by the learned arbitrator , Parsvnath is
directed to f ile a response thereto, before the learned arbitrator, within
a period of two weeks of the learned arbitrator entering on the
reference.
23. With the aforesaid directions, both these petitions stand
disposed of with no orders as to costs.

C. HARI SHANKAR, J.
JANUARY 7, 2021
Sr.bararia
2021:DHC:58