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2012 DIGILAW 1902 (BOM)

Gandhi Adhivitiya Combine v. Chandravadan Bharat Myatra

2012-10-05

R.D.DHANUKA

body2012
Judgment 1. This petition is filed under Section 9 of the Arbitration & Conciliation Act, 1996. The Petitioner seeks an order of appointment of Court Receiver and mandatory injunction against the respondents to forthwith hand over possession of existing tenement/structure occupied by the respondent to the petitioner. 2. The Petitioner is a developer. By an agreement dated 1st February, 1996 entered into between Smt. Kusumben Gandhi & Ors. and four others as owners, petitioner herein and the respondent. Recital (c) of the said agreement provides that the tenant/occupant is the only Tenant/Occupant of a shop on the ground floor structure admeasuring 18.30 sq. mtr. Recital (d) provides that the owners of the said property proposed to develop the said property and has executed development agreement with the petitioner. The Petitioner has accordingly approached the tenant/occupant and offered to provide a permanent alternative accommodation in lieu of present occupied structures and for releasing, relinquishing and extinguishing the occupation rights of the tenant/occupant. The recital provides that the tenant/occupant is in occupation of the property in respect of the ground floor admeasuring 200 sq. ft. of carpet area on monthly rent of Rs. 60/-. Clause 3 of the agreement provides that the tenant agrees to hand over peaceful possession of the structures presently occupied by him before commencement of the actual demolition work of the existing structure. In clause 4 of the agreement, the developer agreed to give free of cost on ownership basis a shop admeasuring 200 sq. ft. of carpet area including area of balcony to be reconstructed on the said plot as per the plans which may be sanctioned by the Municipal Corporation of Grater Bombay. It is provided that the shop shall be located on ground floor only and shall be facing Parsi Panchayat Road. Clause 21 of the agreement provides for arbitration. 3. It is not in dispute that pursuant to the said agreement, the petitioner has started construction on the plot on which the suit structure is situated and is at advanced stage. In the year 2007, the respondent and her husband filed a suit being L.C. Suit No. (106 of 2007) against the petitioner as well as four others including the Municipal Corporation and one M/s. Akruti Builders seeking various reliefs. In the year 2007, the respondent and her husband filed a suit being L.C. Suit No. (106 of 2007) against the petitioner as well as four others including the Municipal Corporation and one M/s. Akruti Builders seeking various reliefs. The Petitioner made a statement in the said proceedings that the petitioner would comply with the terms and conditions of the agreement dated 1st February, 1996. In the said suit an exparte decree came to be passed by the City Civil Court on 4th September, 2010. 4. On 27th October, 2008, the petitioner through its advocates issued a notice invoking arbitration clause to the respondent and nominated Mr. Rajkumar Ashar as an Arbitrator. In the said notice it is stated that though the petitioner had repeatedly called upon the respondents to vacate the existing old tenements, the respondent had not complied with the same. By letter dated 6th November, 2008, the respondents through her advocate contended that the dispute was in respect of tenanted premises and she was protected under the provisions of the Rent Act. She has already filed a suit in the City Civil Court for an order of injunction against the petitioner. It is contended that the agreement have elapsed by efflux of time and thus cannot be enforced. The respondent did not appoint the arbitrator. 5. On 16th November, 2009, the petitioner once against issued notice to the respondents to vacate the premises. The Petitioner stated that the plans have already been sanctioned and excavation work at the site was about to commence and the continuous occupation of the respondent was causing obstruction to the excavation work at the site causing delay to the project. On 3rd September, 2010 the petitioner again called upon the respondent to vacate the premises. 6. The Petitioner thereafter filed Notice of Motion for setting aside the exparte decree passed by the City Civil Court. The Petitioner pointed out that it had already invoked the arbitration clause and filed application under the provisions of section 9 and 11 of the Arbitration & Conciliation Act, 1996. By an order dated 8th September, 2011 the Additional Sessions Judge, City Civil and Sessions Court allowed the said Notice of Motion and the said exparte decree passed by the City Civil Court came to be set aside. 7. By an order dated 8th September, 2011 the Additional Sessions Judge, City Civil and Sessions Court allowed the said Notice of Motion and the said exparte decree passed by the City Civil Court came to be set aside. 7. The Petitioners thereafter have filed written statement in the said suit raising a plea that the City Civil Court has no jurisdiction to try and entertain the suit in view of the arbitration clause i.e. clause 21 of the agreement. The said suit is pending. 8. The Petitioner has filed additional affidavit in Arbitration Application No. 104 of 2011. It is stated that the petitioner is ready and wiling to shift the respondent on transit rent by offering Rs.10000/-per month, but the respondent is reluctantly not accepting the same. It is stated that the petitioner has already provided the plan showing the location of the permanent alternative accommodation to the respondent. It is stated that the husband of the respondent is a practicing Doctor and has his own dispensary in another building in the same area. It is stated that the structure occupied by the respondent is in dilapidated condition and may collapse any time. Reliance is also placed on the photographs showing the condition of the structure. 9. The learned counsel appearing for the petitioner submits that most of the occupants have already vacated and the present respondent and two other commercial premises holders are the only people who have refused to vacate. The Petitioner has already obtained permission for construction of transit accommodation. It is submitted that in view of this obstructive attitude of the respondent the entire project is being substantially delayed. Though the petitioner had agreed to offer transit rent to the respondent, he has not come forward to accept the same. 10. The Petitioner is ready to provide an alternative accommodation as agreed in the agreement dated 1st February, 1996. The Petitioner has thus filed these proceedings for appointment of the Court Receiver and injunction. 11. Mr. Vashi, the learned counsel for the respondent on the other hand submits that the present proceedings under section 9 is not maintainable on the ground that the respondent is the tenant of the petitioner and the dispute between the landlord and tenant can not be referred to arbitration. The said dispute can be decided only by the Small Causes Court. 12. The said dispute can be decided only by the Small Causes Court. 12. The next submission of the learned counsel is that the suit for injunction has already been filed by the respondent in Bombay City Civil Court against the petitioner and the same is pending. The Petitioner has not made any application under section 8 of the Arbitration and Conciliation Act, 1996 for referring the dispute to arbitration. The Petitioner has thus waived his right to refer the disputes to arbitration. 13. The next submission of Mr. Vashi is that the petitioner had agreed to give larger area to the respondent and not the area recorded in the agreement. 14. In so far as issue of jurisdiction raised by Mr. Vashi is concerned, perusal of the agreement dated 1st February, 1996 entered into between the owners, petitioners and the respondent indicates that the petitioner is a party to the said agreement as developer. The respondent has agreed to surrender the structure in their occupation to the petitioner in lieu of the petitioner offering alternate accommodation on ownership basis. Till the alternative accommodation is handed over to the respondent, the petitioner has agreed to provide transit rent or other alternate premises. In my view, considering the provisions under the agreement entered into between the parties, the dispute does not pertain to any tenancy rights of the respondent. The parties having agreed to refer the dispute to arbitration, the petitioner is right in invoking arbitration clause 21 of the development agreement. I am therefore, thus not inclined to accept the submissions made by Mr. Vashi that the dispute is required to be decided by Small Causes Court and not by the Arbitrator. 15. The next submission of the learned counsel is that the petitioner has agreed to provide larger area and not the area as mentioned in the agreement is concerned, it would be appropriate to refer to a letter dated 3rd September, 1997 addressed by the respondent to the Special Land Acquisition Officer (Exh. G) to the suit filed before the City Civil Court. The respondent has stated that by the agreement dated 10th January 1996, the landlord had agreed to give respondent suitable shop on the ownership basis on the ground floor admeasuring 200 sq. ft. G) to the suit filed before the City Civil Court. The respondent has stated that by the agreement dated 10th January 1996, the landlord had agreed to give respondent suitable shop on the ownership basis on the ground floor admeasuring 200 sq. ft. carpet area facing Parsi Panchayat Road on the very same plot where he has intended to build a building which may fetch lacs of rupees as per present market value. It is stated that in the event of acquisition of the said plot for any public purpose, the respondent would be deprived of the alternate accommodation as well as lacs of rupees in monetary consideration offered by the petitioner. In any event, if according to respondent, the petitioner has offered any larger area and not the area as recorded in the agreement, it is for the respondent to agitate that issue before the arbitrator. 16.The next submission of learned counsel Mr. Vashi is that in view of the pendency of the suit filed by the respondent against the petitioner in City Civil Court and the petitioner having participated in the said proceedings and not having filed any application under section 8 of the Arbitration & Conciliation Act, 1996 has waived his right of referring the matter to arbitration is concerned, perusal of the plaint in L.C. Suit No.106 of 2007 filed by the respondent, indicates that the respondent along with her husband has filed the said suit not only against the petitioner but also Mr. D. Parekh, Akruti Builders Pvt. Ltd., Brihan Mumbai Municipal Corporation, Executive Engineer of Municipal Corporation. On perusal of the prayer clause it is clear that the respondent has not only prayed for injunction against the petitioner but has also sought substantial reliefs against M/s. Akruti Builders Private Limited and Municipal Corporation who are admittedly not parties to the development agreement entered into between the petitioner and respondents. It is not in dispute that the petitioner had taken out Notice of Motion for setting aside exparte decree. Even in the said proceedings, it was brought to the notice of the City Civil Court that there exists arbitration Clause between the parties and proceedings under section 9 and 11 have already been filed by the petitioner. It is not in dispute that the petitioner had taken out Notice of Motion for setting aside exparte decree. Even in the said proceedings, it was brought to the notice of the City Civil Court that there exists arbitration Clause between the parties and proceedings under section 9 and 11 have already been filed by the petitioner. In the written statement filed by the petitioner, the petitioner has raised the issue of jurisdiction of the City Civil Court in view of the Arbitration agreement entered into between the parties. In my view, thus there is no waiver on the part of the petitioner to refer the dispute to arbitration. 17. Even otherwise, considering prayers in the suit filed by the respondent, it is clear that it is not possible to split the reliefs claimed by the respondent in the said suit, thus that court can not refer part of the dispute to arbitration. I am therefore, of the view that merely because the said suit is filed in prior point of time by the respondent and the petitioner has not filed application under section 8 of the Act, there is no waiver on the part of the petitioner in the facts and circumstances of this case. 18. It is not in dispute that the excavation work has started on the plot on which the suit structure is situated. It is also not in dispute that the respondent has already shifted to other premises and the structure is not occupied by anybody. The Petitioner has produced photographs and copies of the plans sanctioned by the Municipal Corporation which shows the dilapidated condition of the structure and that the provision is made for providing alternate accommodation in respect of the disputed structure respectively. In my opinion, one occupant can not stall the entire project. The Petitioner has already offered the transit rent to the respondent which she has not accepted. Considering the status of the structure as reflected in the photographs produced by the petitioner, it is clear that if the said structure is not demolished, it may collapse and would also cause further delay of the project. 19. The learned counsel for the petitioner undertakes to offer Rs.10,000/-per month to respondent as transit rent from the date on which the said structure is removed and or possession thereof is handed over to the petitioner. 20. 19. The learned counsel for the petitioner undertakes to offer Rs.10,000/-per month to respondent as transit rent from the date on which the said structure is removed and or possession thereof is handed over to the petitioner. 20. For the reasons aforesaid, I am inclined to grant relief in terms of prayer clause (c) of the petition. Till the time the Court receiver takes possession, there shall be interim relief in terms of prayer clause (b). Petition is accordingly disposed of. There shall be no order as to costs. 21. The learned counsel for the respondent seeks stay of this order. Stay is refused.