Case Note & Summary
The matter before the High Court of Judicature for Rajasthan at Jodhpur arose from a writ petition under Articles 226 and 227 of the Constitution of India challenging two concurrent orders of the Rent Tribunal and Rent Appellate Tribunal at Jaisalmer. The petitioner, a partnership firm operating a commercial hotel under the name M/s Shree Vinayak Hotels & Resorts, had entered into a registered lease agreement dated 10.08.2022 with respondent No.1, a private limited company, for a fixed term of four years and eleven months commencing 01.09.2022 to 01.08.2027, at an annual lease consideration of ₹50,00,000, excluding electricity, water and GST. The premises were taken for running a commercial hotel, and the petitioner claimed to have incurred approximately ₹2 crores on maintenance, repairs, promotion and other expenses. Rent was payable quarterly in advance, and the petitioner asserted that rent up to August 2024 had been paid. According to the petitioner, in April 2024 respondent No.3 demanded an increase in annual rent from ₹50,00,000 to ₹1,00,00,000 from June 2024, which was declined. The respondents then issued notices dated 13.05.2024, 15.05.2024 and 18.05.2024, allegedly to secure vacation of the premises. The petitioner replied and furnished an account of losses on 24.05.2024. Apprehending forcible dispossession, the petitioner filed a petition under Section 18 of the Rajasthan Rent Control Act, 2001 before the Rent Tribunal, Jaisalmer, which initially passed an interim order dated 26.06.2024 restraining dispossession except in accordance with law. The respondents then filed an application under Order VII Rule 11 CPC contending that the dispute was not triable by the Rent Tribunal but fell within the jurisdiction of the Commercial Court because the premises were used exclusively for commercial hotel operations. The Rent Tribunal accepted this contention by order dated 02.08.2024, holding that the lease agreement constituted a commercial dispute under Section 2(1)(c)(vii) of the Commercial Courts Act, 2015 and directed return of the petition under Order VII Rule 10 CPC for presentation before the competent Commercial Court. The petitioner's appeal against that order was dismissed by the Rent Appellate Tribunal by judgment dated 23.10.2024, which affirmed that the hotel premises were actually and exclusively used for trade or commerce and therefore the dispute fell within the Commercial Courts Act. The petitioner then filed the present writ petition. The petitioner argued that the relationship was essentially landlord and tenant, that Sections 18 and 29 of the Rajasthan Rent Control Act, 2001 conferred exclusive jurisdiction on the Rent Tribunal, that mere commercial use did not convert the dispute into a commercial dispute, and relied on judgments such as Subhash Chander v. Bharat Petroleum Corporation Ltd., Suresh Shah v. Hipad Technology, Booz Allen v. SBI Home Finance and LRs of Late Ramesh Chandra v. City Pulse Enterprise. Respondent No.1 opposed the writ petition, contending that it was not maintainable as no jurisdictional error was committed and that the premises being used exclusively for commercial hotel operations brought the lease agreement within Section 2(1)(c)(vii) of the Commercial Courts Act, 2015. The available text of the judgment concludes during the submissions of respondent No.1; no final decision or operative order by the High Court is included in the extracted portion.
Headnote
A) Civil Procedure - Return of Plaint - Order VII Rule 10 & Rule 11 CPC - Commercial Courts Act, 2015, Section 2(1)(c)(vii) - The Rent Tribunal and Rent Appellate Tribunal held that a lease agreement for premises used exclusively as a commercial hotel constituted a commercial dispute and directed return of the petition for presentation before the Commercial Court; the appellate tribunal affirmed the order. Held that the dispute was triable by the Commercial Court, not the Rent Tribunal (Paras 2, 7-9). B) Rent Control - Jurisdiction of Rent Tribunal - Sections 18 and 29 Rajasthan Rent Control Act, 2001 - Petitioner contended exclusive jurisdiction over landlord-tenant disputes and that mere commercial use did not oust the Rent Tribunal; the tribunals distinguished the case on the ground that the immovable property was a hotel actually and exclusively used for trade or commerce. Held that the Rent Tribunal lacked jurisdiction because the dispute fell under the Commercial Courts Act (Paras 8-10). C) Constitutional Law - Writ Petition under Articles 226 and 227 - Supervisory Jurisdiction - Constitution of India, Articles 226 and 227 - Petitioner invoked writ jurisdiction to quash concurrent findings of the Rent Tribunals; respondent challenged maintainability, asserting no jurisdictional error; the High Court was to examine whether the tribunals correctly applied Section 2(1)(c)(vii) of the Commercial Courts Act, 2015. Held that the writ petition raised questions regarding jurisdiction and maintainability, pending decision (Paras 1, 4, 9-10). D) Commercial Courts - Bar of Jurisdiction - Section 11 of Commercial Courts Act, 2015 - Petitioner argued that Section 11 did not bar the Rent Tribunal's jurisdiction and that statutory tenancy protections under the Rajasthan Rent Control Act exclusively governed; respondent submitted that the commercial hotel lease fell within the Commercial Courts Act. Held that the issue required determination whether Section 2(1)(c)(vii) operated to exclude Rent Tribunal jurisdiction (Paras 10-11).
Issue of Consideration
Whether the dispute arising from a registered lease agreement for a commercial hotel falls within the definition of 'commercial dispute' under Section 2(1)(c)(vii) of the Commercial Courts Act, 2015, thereby ousting the jurisdiction of the Rent Tribunal under Section 18 of the Rajasthan Rent Control Act, 2001; Whether the application under Order VII Rule 11 CPC was correctly allowed and the petition returned under Order VII Rule 10 CPC.
Law Points
- Commercial dispute includes agreements relating to immovable property used exclusively in trade or commerce under Section 2(1)(c)(vii) of Commercial Courts Act
- 2015
- Rent Tribunal jurisdiction under Section 18 Rajasthan Rent Control Act
- 2001 is exclusive for landlord-tenant disputes but may be ousted if dispute falls under Commercial Courts Act
- Section 11 of Commercial Courts Act
- 2015 bars jurisdiction of civil courts in commercial disputes
- Order VII Rule 11 CPC rejection requires consideration of plaint averments
- Ordinary landlord-tenant disputes involving commercial premises may still be triable by Rent Tribunal if not a commercial dispute under Section 2(1)(c)(vii)
