1. Rajesh Kumar Gambhir S/O Late Sh. R.L. ... vs 1. Gurpreet Singh Anand S/O Late Shri ... on 31 August, 2022

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Delhi High Court - Orders

1. Rajesh Kumar Gambhir S/O Late Sh. R.L. ... vs 1. Gurpreet Singh Anand S/O Late Shri ... on 31 August, 2022

1. The present petition has been filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as "A&C Act, 1996") on behalf of the petitioners seeking appointment of a Sole Arbitrator to adjudicate the disputes between the parties.

2. Facts in brief as narrated in the petition are that Late Shri R.L. Gambhir was the owner of Property bearing No. D-99, Pushpanjali Enclave, Pitampura, Delhi-110034 (hereinafter referred to as the "subject property"). Late Shri R.L. Gambhir died on 21st June, 2013 and he was survived by his son, namely, Mr. Rajesh Kumar Gambhir (petitioner No. 1), Smt. Shashi Gambhir (petitioner No. 2), who is the wife of brother of petitioner No.1- Rajesh Kumar Gambhir and Smt. Anita Gambhir (petitioner No.3), who is the wife of petitioner No.1-Rajesh Kumar Gambhir.

3. The respondent Nos. 1 and 2 are the builders-cum-developers of real estate properties. Late Shri R.L. Gambhir, the petitioners and respondent Nos. 1 and 2 entered into a Collaboration-cum-Redevelopment Agreement Signature Not Verified Digitally Signed ARB.P. 289/2022 Page 2 of 7 By:SAHIL SHARMA Signing Date:13.09.2022 16:06:24 dated 13th August, 2012, wherein it was agreed that the existing structure would be demolished and redeveloped into a building with four floors. Various terms were agreed in the Collaboration Agreement dated 13th August, 2012. The physical possession of the subject property was handed over to the respondent Nos.1 and 2 for commencing the redevelopment. The existing structure was demolished by the respondent Nos. 1 and 2. Late Shri R.L. Gambhir died on 21st June, 2013 and the property was bequeathed by him in favour of the petitioner Nos. 1 and 2 and respondent No. 3 in terms of the unregistered Will and Testament dated 17 th May, 2010. The petitioner Nos. 1 and 2 and the respondent No. 3 are the joint and absolute owners of the subject property.

4. It is asserted that the respondent Nos.1 and 2 stopped the redevelopment work of the subject property on the demise of Late Shri R.L. Gambhir.

5. A fresh Collaboration Agreement was entered into between the legal heirs of Late Shri R.L. Gambhir, who are the petitioner Nos. 1 and 2, and the respondent Nos. 1 and 2 for the redevelopment of the subject property.

6. Clause 25 of the Collaboration Agreement dated 09 th December, 2014 provided for the resolution of disputes through Arbitration which reads as under:

"25. That in the event of any Party being in breach of its obligation to complete their obligation(s) with regard to this Agreement, the parties hereto shall make all efforts to resolve the same in consultation with each other, however in the event, the same cannot be resolved by mutual efforts, the dispute shall be referred to the arbitration of the Sole Arbitrator be appointed by both the parties. The arbitration proceeding shall be conducted at Delhi in English language and in accordance Signature Not Verified Digitally Signed ARB.P. 289/2022 Page 3 of 7 By:SAHIL SHARMA Signing Date:13.09.2022 16:06:24 with the Arbitration and Conciliation Act, 1996 or any modified legislation time being in force. In case, the decision is not acceptable to any Party, then both the Parties have the right to move to the Hon'ble Court of Delhi".

7. It is submitted that the respondent Nos. 1 and 2 failed to strictly comply with their obligations under the Collaboration Agreement dated 09 th December, 2014 and the Agreement to Sell dated 21st March, 2016 entered into between the parties. The respondent Nos. 1 and 2 also failed to perform the obligations of completing the construction and handing over the entire project on or before 08th December, 2015, and completing the construction of the first floor portion of the subject matter property and handing over of the possession of completed and finished first floor of the subject property. The respondent Nos. 1 and 2 have unauthorizedly and illegally tried to establish their claim over the first floor by making one Rajinder Singh reside the first floor.

8. Owing to such failure of the respondent Nos. 1 and 2 to hand over the possession of the first floor, the petitioner No. 1 was constrained to file suit bearing No. CS No. 1005/2017 before the Additional District Judge, Rohini Courts, Delhi seeking partition of the subject property among the legal heirs of Late Shri R.L. Gambhir which is pending adjudication.

9. It is further asserted that the Agreement to Sell dated 21st March, 2016 is inherently linked and intertwined with the Collaboration Agreement dated 13th August, 2012 and 09th December, 2014 and the performance of one is not possible without the performance of the other. There is a clear overlap in these Agreements inasmuch as the parties are same and the subject property also remains the same. The disputes have arisen in respect of the Collaboration Agreement. The petitioner Nos. 1 and 3 in an endeavour to Signature Not Verified Digitally Signed ARB.P. 289/2022 Page 4 of 7 By:SAHIL SHARMA Signing Date:13.09.2022 16:06:24 resolve the issues had visited the office of the respondent No.1 on 07 th July, 2017, but the respondent No. 1 refused to remove Mr. Rajinder Singh from the first floor on the pretext that he wanted to make sure that respondent No. 3 and the petitioner No. 2 suffer.

9. The petitioners were thus constrained to issue Legal Notice dated 23 rd November, 2021 invoking Arbitration Clause in terms of Clause 25 of the Collaboration Agreement dated 09th December, 2014. The respondents failed to give consent for appointment of an Arbitrator. Hence, the present petition has been filed for appointment of the Arbitrator.

10. Learned counsel on behalf of the respondents has argued that the disputes raised in the present petition pertain to the Collaboration Agreement 09th December, 2014 according to which the possession had to be given till December, 2015. The claim of the petitioners is, therefore, patently barred by limitation.

11. The reliance has been placed on Vidya Drolia vs. Durga Trading Corporation (2021) 2 SCC 1, wherein the Hon'ble Supreme Court categorically held that the Court should not ordinarily accept claim ex-facie time barred. It has been held that the Court must undertake a primary first review to weed out "manifestly ex facie non-existent and invalid arbitration agreements, or non-arbitrable disputes." The prima facie view at the reference stage is to cut the deadwood, where dismissal is barefaced and pellucid, and when on the facts and law, the litigation must stop at the first stage. Only when the Court is certain that no valid Arbitration Agreement exists, or that the subject-matter is not arbitrable, that reference may be refused.

12. It is further submitted that the respondent No. 3 is a necessary party, Signature Not Verified Digitally Signed ARB.P. 289/2022 Page 5 of 7 By:SAHIL SHARMA Signing Date:13.09.2022 16:06:24 who should have been joined as a petitioner. Since she has not joined as petitioner, petitioner Nos. 1 and 2 cannot raise any disputes against the respondent Nos. 1 and 2. The present petition is not maintainable and is liable to be rejected on the ground of non-joinder of the parties.

13. Furthermore, essentially, the relief being sought by the petitioners is of an injunction which is beyond the jurisdiction as no such relief cannot be granted in Arbitration proceedings. It is, therefore, submitted the present petition is not maintainable and is liable to be dismissed.

14. Submissions heard.

15. There is no denial of there being a Collaboration Agreement dated 13th August, 2012 initially between Late Shri R.L. Gambhir and the respondent Nos. 1 and 2 and, thereafter, admittedly the Collaboration Agreement dated 09th December, 2014 was entered into between the petitioner Nos. 1 and 2 and the respondent No. 3, who were the legal heirs of Late Shri R.L. Gambhir. There is also no denial that there are inter se disputes which have been arisen in respect of the execution of Collaboration Agreement.

16. The first objection taken is that the Suit is barred by limitation, since as per the Collaboration Agreement dated 09th December, 2014, the possession had to be handed over by December, 2015. The petition has been filed in the year 2022 i.e., beyond the period of three years and is barred by limitation. However, there are specific averments made in the petition by the petitioners that the construction and the possession of the property to be constructed in terms of the Collaboration Agreement, has not been discharged by the respondent Nos. 1 and 2. Admittedly, respondent Nos. 1 and 2 are in possession of the First Floor, the Sale Deed in respect of which Signature Not Verified Digitally Signed ARB.P. 289/2022 Page 6 of 7 By:SAHIL SHARMA Signing Date:13.09.2022 16:06:24 has to be executed by them in favour of the respondent No.3 with whom they have an Agreement to Sell. The respondents have to be handed over the possession of ground floor by the petitioners which they are unable to do since the respondents are refusing to do; they have also not executed the Sale Deed in respect of the First Floor. The issue of limitation is thus a mixed question of facts and law and cannot be adjudicated in these proceedings.

17. The other objection taken is that the respondent No.3 has not joined the petitioner Nos. 1 and 2. However, this argument is not tenable as the respondent No. 3 may not have joined as a petitioner but she is a party to the entire dispute envisaged in the petition and is also a party as respondent No. 3. This argument on behalf of the respondents is also not tenable.

18. Considering the facts and submissions made, the petition is accordingly allowed and Mr. R.K. Sharma, District Judge (Retd.), Mobile No. 9871369899, is hereby appointed as the Arbitrator to adjudicate the disputes between the parties.

17. This subject to the learned Arbitrator making the necessary disclosure under Section 12(1) of the A&C Act, 1996 and not being ineligible under Section 12(5) of the A&C Act, 1996.

18. The parties are at liberty to approach the learned Arbitrator for further proceedings.

19. The petition is accordingly disposed of in the above terms.

NEENA BANSAL KRISHNA, J AUGUST 31, 2022 S.Sharma Signature Not Verified Digitally Signed ARB.P. 289/2022 Page 7 of 7 By:SAHIL SHARMA Signing Date:13.09.2022 16:06:24

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Delhi High Court - Orders