Due to time-consuming and expensive litigation, many of the tenant-landlord disputes will be settled and resolved through arbitration under the Transfer of Property acts from now onwards, Supreme court announced. Under The Transfer of Property act, 1882, the Supreme Court believes that arbitral tribunals should be given power and authority to decide the fate of such disputes. Although, such disputes are currently covered and governed by state rent control laws and that’s what makes them non-arbitrable and hence, the designated forums and courts will be allowed to take any decision regarding such disputes under the legislation. There was a verdict which was announced in the case of Vidhya Drolla and others versus Durga Trading Corporation, that overruled the SC’s own judgement of 2017. This verdict was given by the jury headed by Justice NV Ramanna, Justice Sanjeev Khanna and Justice Krishna Murari on December 14. 

Abhilash Pillai who is also the partner at the law firm Cyril Amarchand Mangaldas also spoke in the favour of apex Court’s decision and said that he has immense faith in the arbitration practices and he believes that it is the fairest, responsive and most efficient dispute resolution mechanism and it wonderfully caters to all the contemporary requirements of the leasing industry. He thinks that now the speedy resolution of so many pending cases of tenant-landlord dispute can be taken care of and this will certainly help in de-stressing the courts. 

This verdict also holds extreme importance because the government is also striving hard to promote rental housing schemes across the country which is supposed to provide more flexibility to the tenants in terms of legal soups. 

Also, for more effective resolution through arbitration, a clause of arbitration has to be there, if the parties have mutually consented to solve their disputes through arbitration, said Huzefa Nasikwala, founding partner of Nasikwala Law Office.

He also pointed out clearly all the Supreme Court guidelines regarding the disputes that are not arbitrable, objections to be raised against arbitrability of the disputes and which court or forum holds the authority to decide on arbitrability and other relevant aspects.

This ruling is quite essential for big metropolitans such as Mumbai. However, the court has already clarified that such disputes fall under state rent control laws and only special courts and forums set up for this will be authorised to deal with such cases. The Transfer of Property Act is assumed to serve the special public purpose to regulate landlord-tenant relationships and the arbitrator is expected to adhere to all the provisions, including the ones that are made for the protection of tenants as per the order of 243 pages.