M/S Adarsha Developers vs Mr Umapathi Alias Umapthi K Reddy on 11 September, 2013

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Karnataka High Court

M/S Adarsha Developers vs Mr Umapathi Alias Umapthi K Reddy on 11 September, 2013

Bench: Huluvadi G. Ramesh

                          1


     THE HIGH COURT OF KARNATAKA AT BANGALORE

     DATED THIS THE 11TH DAY OF SEPTEMBER, 2013

                       BEFORE

     THE HON'BLE MR. JUSTICE HULUVADI G. RAMESH

                C.R.P.NO.496/2012 (INJ)


BETWEEN

1.    M/S. ADARSHA DEVELOPERS
      NO.10, VITTAL MALLYA ROAD
      BANGALORE - 560 001
      A REGISTERED PARTNERSHIP FIRM
      REPRESENTED BY ITS PARTNER
      AND AUTHORIZED SIGNATORY
      MR. B.M. KARUNESH

2.    MR. B.M.KARUNESH
      AGED ABOUR 46 YEARS
      S/O. LATE SRI. B.M.MADAIAH
      PARTNER,
      M/S. ADARSHA DEVELOPERS
      NO.10, VITTAL MALLYA ROAD
      BANGALORE - 560 001

3.    MR. B.M.JAYESHANKAR
      AGED ABOUT 53 YEARS
      S/O. LATE SRI. B.M. MADAIAH
      PARTNER,
      M/S. ADARSHA DEVELOPERS
      NO.10, VITTAL MALLYA ROAD
      BANGALORE - 560 001
                                    ... PETITIONERS

(BY SRI SHYAM KOUNDINYA.A.S, ADV.)
                          2


AND

1.    MR. UMAPATHI ALIAS
      UMAPTHI K. REDDY
      AGED ABOUT 59 YEARS
      S/O SRI. KRISHNAPPA
      RESIDING AT NO. 362
      BELLANDUR VILLAGE
      (NEAR POST OFFICE)
      BANGALORE EAST TALUK
      BANGALORE - 560 103

2.    MR. AVINASH REDDY
      AGED ABOUT 26 YEARS
      S/O. MR. UMPATHI K. REDDY
      RESIDING AT NO.362
      BELLANDUR VILLAGE
      (NEAR POST OFFICE)
      BANGALORE EAST TALUK
      BANGALORE - 560 103

      NOW BOTH 1 AND 2 RESIDING AT
      NO.9562, SHADOWGROVE DRIVE
      RANCHO CUCAMONGA
      CA 92730, USA
                               ... RESPONDENTS

(BY SRI UMAPATHI @ UMAPATHI K. REDDY,
 PARTY IN PERSON)


      THIS CRP FILED UNDER SEC.115 OF CPC AGAINST
THE ORDER DATED 12.10.2012 PASSED ON IA NO.3 IN
O.S.NO.5/2012 ON THE FILE OF THE 24TH ADDL. CITY
CIVIL & SESSIONS JUDGE, BANGALORE, DISMISSING THE
IA NO.3 FILED UNDER SEC.8 OF THE ARBITRATION AND
CONCILIATION ACT 1996.
      THIS PETITION COMING ON FOR ADMISSION THIS
DAY, THE COURT MADE THE FOLLOWING:-
                             3


                        ORDER

Heard the counsel for the petitioner and the respondent - party in person.

2. This petition is in respect of Joint Development agreement between the petitioner who is a developer and respondent who is the landlord. Referring to clause 23 of the agreement dated 8.12.2006, order has been passed by the trial Court on the application filed in I.A.3 seeking for appointment of Arbitrator as per Section 18 of the Arbitration and Conciliation Act, 1996, opining that there is no scope for referring the matter to the Arbitrator.

3. Having regard to the tenor of clause 23 of the agreement, learned counsel appearing for the petitioner has argued that arbitration clause which is provided is meant to be adjudicated between the developer and the landlord and there is no meaning to interpret that arbitration clause should be only between owners in 4 case of dispute. Accordingly, he submitted that prima facie error is committed by the trial Court.

4. The respondent who is party in person, has submitted that even if it is read independently, clauses 23 and 27 of the joint development agreement duly provide for specific performance in case of breach of the agreement and there is no specific clause for reference of dispute to arbitration between developer and landlord/owner, as such the trial Court has rightly dismissed the I.A. filed by the petitioner herein.

5. Apart from clause 23 which provides for arbitration, clause 27 specifically provides that owner and developer, both of them are entitled to seek specific performance and in case of default, they can claim damages. Clause 29 provides that in the event of breach by either party, the other party i.e., the aggrieved party would be entitled for specific performance and also would be entitled to recover all the losses and 5 expenses as a consequence of such breach from the party committing breach.

6. Though arbitration clause 23 provides for arbitration, it is opined by the trial Court that arbitration of dispute is provided between the owners and not between the developers and landlord/owner. However, in view of clauses 26, 27 & 29 of the said agreement, in case of breach, both the owners and developer are entitled to seek specific performance. Therefore, I do not find any merit in the contention of the counsel for the petitioner.

7. Hence the petition is dismissed. Consequently, I.A.1/12 filed for stay does not survive for consideration and the same is disposed of.

Sd/-

JUDGE RS/*

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