Bombay High Court
Punjab National Bank Workers ... vs Meeti Developers Pvt Ltd on 11 February, 2021
Author: G. S. Patel
Bench: G.S. Patel
15-18-19-ARBPL8189-2020+.DOC
Arun
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
ARBITRATION PETITION (L) NO. 8189 OF 2020
WITH
INTERIM APPLICATION (L) NO. 2034 OF 2021
IN
ARBITRATION PETITION (L) NO. 8189 OF 2020
Punjab National Bank Workers Cooperative ...Petitioner
Housing Society Limited
Versus
Meeti Developers Private Limited ...Respondent
WITH ARBITRATION PETITION (L) NO. 1789 OF 2021 Meeti Developers ...Petitioner Versus Punjab National Bank Workers Cooperative ...Respondent Housing Society Limited ARUN WITH RAMCHANDRA SANKPAL Digitally signed by ARUN RAMCHANDRA SANKPAL ARBITRATION APPLICATION (L) NO. 2614 OF 2021 Date: 2021.02.12 11:00:37 +0530 Meeti Developers ...Applicant Versus Punjab National Bank Workers Cooperative ...Respondent Housing Society Limited Mr Rohaan Cama, with Anand R Pai, Yogesh Pandey and Sachin Mhatre, i/b Mhatre Law Associates, for the Petitioner in ARBPL/ Page 1 of 26 11th February 2021 15-18-19-ARBPL8189-2020+.DOC 8189/2020 and for the Respondent in ARBPL/1789/2021 and ARBAPL/2614/2021.
Mr Anoshak Davar, with Pranesh J Gada, i/b Dhanuka & Partners, for the Respondent in ARBPL/8189/2020 and for the Petitioner/ Applicant in ARBPL/1789/2021 and ARBAPL/2614/2021 Mr Saurabh Bhuta, Director of Meeti Developer present.
CORAM: G.S. PATEL, J
DATED: 11th February 2021
PC:-
1. This is a Section 9 Petition fled by Punjab National Bank Workers Cooperative Housing Society Limited ("the Society"). The sole Respondent is Meeti Developers.
2. On 17th December 2020, I made the following order in Arbitration Petition (L) No. 8189 of 2020.
" 1. Heard through video conferencing.
2. The dispute is between a society and a developer. It follows the usual trajectory, except that in this case the facts may be even more shocking. The Petitioner's members vacated in 2008, 12 years ago. In that time, no steps have been taken to carry on the development under the Development Agreement dated 15th December 2004 and the Supplementary Agreement dated 26th February 2005. About 15 to 16 years have now gone by without any progress. There are arrears of transit rent from June 2019 at the very least.
3. Having regard to these circumstances, I will grant the relief in terms of prayer clause (g), which reads thus:Page 2 of 26
11th February 2021 15-18-19-ARBPL8189-2020+.DOC "(g) That pending the commencement and culmination of the Arbitral Proceedings between the Petitioner and the Respondent and till the Award become executable, the High Court be pleased to Issue an order and injunction restraining the Respondent, its respective ofcers, servants, agents or any other persons claiming through or under them, including Contractors, labourers, men, in any manner selling, transferring, alienating, encumbering, parting with possession of or creating any third party rights of any nature whatsoever in respect of the building known as Punjab National Bank Co-operative Housing Society Ltd., being constructed and situated on the piece and parcel of the land bearing Plot No. 422(A) and 423 admeasuring 600.32 square meters and 608.68 square meters together with City Survey No. 20, C.T.S. No. 68 of TPS III, Gorai Road, Borivali (West), Mumbai 400 091;"
4. This order will continue until the next date.
5. The Respondent is absent though served. The Petitioners will serve the Respondents again.
6. Afdavit in Reply is to be fled and served on or before 6th January 2021. Afdavit in Rejoinder, if any, is to be fled and served on or before 14th January 2021.
7. List the matter on 21st January 2021."
3. About a month later, on 18th January 2021, Meeti Developers fled its own Section 9 Petition against the society. The two Petitions emanate from the set of agreements and facts. I will turn to these Page 3 of 26 11th February 2021 15-18-19-ARBPL8189-2020+.DOC shortly. Before I do that, it is best to set out the prayers that each seeks against the other.
4. The prayers in the Society's Section 9 Petition read thus:
"(a) That pending the commencement and culmination of the Arbitral proceedings between the Petitioner and the Respondent and till the Award become executable, this High Court be pleased to direct the Respondents to pay a sum of Rs.2,50,000/- (Rupees Two Crore Fifty Lakhs Only) for the damages caused to the petitioners in the form of physical and mental stress, agony and harassment;
(b) That pending the commencement and culmination of the Arbitral Proceedings between the Petitioner and the Respondent and till the Award becomes executable, the High Court be pleased to mandatorily order and direct the Respondents to make the payment of the total arrears of rent, totalling to a sum of Rs.4,02,325/- (Rupees Four Lakhs Two Thousand Three Hundred Twenty Five Only) per member, the total of which amounts to Rs.64,37,200/-
(Rupees Sixty Four Lakh Thirty Seven Thousand Two Hundred Only) for 16 fat members, as is more particularly set out in the Particulars of Claim annexed at Exhibit - "H".
(c) That pending the commencement and culmination of the Arbitral Proceedings between the Petitioner and the Respondent and till the Award become executable, this High Court be pleased to mandatorily order and direct the Respondents, its respective ofcers, servants, agents or any other persons claiming through or under them, including Contractors, labourers, men, equipment and such other paraphernalia to quit vacate and hand over quiet and peaceful physical possession of the said suit property to the Petitioners forthwith. Or, Alternatively;
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(d) That pending the commencement and culmination of the Arbitral Proceedings between the Petitioner and the Respondent and till the Award become executable, this Hon'ble Court be pleased to appoint Court Receiver, High Court, or some such other ft and proper person be appointed as the Court Receiver, with all powers under Order XXXX Rule (1) of the Code of Civil Procedure, 1908 and take the physical possession from the Respondent and/ or any person or persons or any one claiming through or under them either their staf, workers, personnel or anyone found at the suit property site, with the help of Police force, if necessary and to put the Petitioners in exclusive possession thereof, without royalty and security;
(e) That pending and commencement and culmination of the Arbitral Proceedings between the Petitioner and the Respondent and till the Award become executable, this High Court be pleased to direct the Respondents its respective ofcers, servants, agents or any other persons claiming through or under them, including Contractors, labourers, men, to remove goon/s bouncers placed by them from the said suit property;
(f ) That pending the commencement and culmination of the Arbitral Proceedings between the Petitioner and the Respondent and till the Award become executable, this High Court be pleased to issue an order and injunction restraining the Respondents from meddling and/or interfering with and/or causing any objection in any manner whatsoever, to the Petitioner society in their redevelopment process and construction of the suit property, either on their own or through any other independent Contractor or Developers;
(g) That pending the commencement and culmination of the Arbitral Proceedings between the Petitioner and the Page 5 of 26 11th February 2021 15-18-19-ARBPL8189-2020+.DOC Respondent and till the Award become executable, this High Court be pleased to Issue an order and injunction restraining the Respondent, its respective ofcers, servants, agents or any other persons claiming through or under them, including Contractors, labourers, men, in any manner selling, transferring, alienating, encumbering, parting with possession of or creating any third party rights of any nature whatsoever in respect of the building known as Punjab National Bank Cooperative Housing Society Ltd., being constructed and situated on the piece and parcel of the land bearing Plot No. 422(A) and 423 admeasuring 600.32 square meters and 608.68 square meters together with City Survey No. 20, C.T.S. No. 68 of TPS III, Gorai Road, Borivali (West), Mumbai 400 091.
(h) That pending the commencement and culmination of the Arbitral Proceedings between the Petitioner and the Respondent and till the Award become executable, this High Court be pleased to issue an Order and injunction restraining the Respondent, its respective ofcers, servants, agents or any other persons claiming through or under them, including Contractors, labourers, men, from n any manner executing any fresh or further documents/Agreements/allotments in respect of any of the Free Sale Flats/Ofces in the said suit property and also further restrain them from taking any further consideration from any of their fat/unit, buyers thereof;
(i) That pending the commencement and culmination of the Arbitral Proceedings between the Petitioner and the Respondent and till the Award become executable, this High Court be pleased to issue order and direct the Respondents to hand over to the Petitioners in original, each and every document relating to the redevelopment process of the said suit property, including but not limited to, the sanctioned plans, approvals, permissions applied for, Page 6 of 26 11th February 2021 15-18-19-ARBPL8189-2020+.DOC power of attorney, Development Agreement and all such other documents, which are in their possession in respect of the said suit property, to the Petitioners;
(j) That pending the commencement and culmination of the Arbitral Proceedings between the Petitioner and the Respondent and till the Award become executable, this High Court be pleased to issue Order and direct the Respondents to issue the respective NOCs from the following, but not limited to, Structural Engineer, Architects and Consultants, MEP Consultants, Project Management Consultant, Licensed Plumbing Contractor, Electrical Contractor, Painting and Fabrication Contractor and other such Consultants/Contractor/Agencies employed by the Respondent in respect of the said suit property;
(k) That pending the commencement and culmination of the Arbitral Proceedings between the Petitioner and the Respondent and till the Award become executable, this High Court be pleased to direct the Respondents to disclose all the Agreements for Sale/Allotment Letters, executed/entered into by them in favour of any third party/allottee/purchaser etc in respect of the Flats and Units sold by them, with all the details of the monies received and the monies outstanding;
(l) That pending the commencement and culmination of the Arbitral Proceedings between the Petitioner and the Respondent and till the Award becomes executable, this High Court be pleased to direct the Respondents, its Directors and their family members to disclose on oath;
(i) All their assets, movable as well as
immovable;
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(ii) The Companies or Firms in which they are shareholders, Directors or partners, the extent of their share or shareholding therein, the assets movable (including receivables) as well as immovable held by such Companies or Firms;
(iii) The Income Tax Returns fled by them as well as the Firm and the Companies in which they are partners or shareholders from the year 2017 till date;
(iv) The Proft and Loss Account, the Balance Sheet, the Trial Balance and the entire Ledger with detailed narration from the year 2017 till the date of the Respondents as well as its Directors;
(v) Such property/properties, movable as well as immovable, whether held by them or held through any of the persons or entity as may be owned by them or any of them or their family members and the encumbers, if any, thereon;
(vi) Bank Statements of all Bank Account held by the Respondents, its directors, and all their family members from the year 2017 till date;"
5. Meeti Developers for its part seeks the following reliefs.
"(a) Pending the commencement and culmination of the Arbitral proceedings the Respondent and its members be restrained and injuncted by an order and direction from this Hon'ble Court from executing any Agreement granting development rights in respect of suit premises to any other developer/promoter and if the same is executed the Respondent be restrained and injuncted by an order and direction of this Hon'ble Court from acting and implementing upon the same;Page 8 of 26
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(b) Pending the commencement and culmination of the Arbitral proceedings the Respondent be restrained and injuncted by an order and direction from this Hon'ble Court from disturbing the possession of the Petitioner in the suit premises.
(c) Pending the commencement and culmination of the Arbitral proceedings the Respondent and moreso its shop owners be restrained and injuncted by Order and direction of this Hon'ble Court from parting with the possession of their ships to any other person which are situate, lying and being at the premises;
(d) Pending the commencement and culmination of the Arbitral proceedings the Respondent and its members, agents or any person claiming through or by them be restrained and injuncted by an Order and direction from this Hon'ble Court from approaching the Architects, contractors, labourers etc. appointed by the Petitioner in respect of the suit premises;
(e) Pending the commencement and culmination of the Arbitral proceedings the Respondent and its members, agents or any person claiming through or by them be restrained and injuncted by an order and direction from this Hon'ble Court from applying, processing to MHADA for permissions and approvals in respect of the suit premises;
(f ) Pending the commencement and culmination of the Arbitral proceedings the Respondent be directed and ordered by this Hon'ble Court to disclose and furnish to the Petitioner the alleged Development Agreement purported to be executed by few members of the Respondent with the alleged Developer;
(g) Pending the commencement and culmination of the Arbitral proceedings the Respondent be directed and Page 9 of 26 11th February 2021 15-18-19-ARBPL8189-2020+.DOC ordered by this Hon'ble Court to disclose and furnish to the Petitioner all the details of the amounts taken from the alleged Developer;
(h) Pending the commencement and culmination of the Arbitral proceedings the Respondent be ordered and directed by this Hon'ble Court to furnish a copy of their entire minutes of the meeting book to the Petitioner."
6. I noted on 17th December 2020 that this case follows the usual trajectory. On a fuller hearing, it seems to me that that early observation is not only accurate, but in this particular case may even be an considerable understatement.
7. The contractual transactions between the parties have been through many iterations. The transactional documents themselves are not in dispute.
8. It began with a Development Agreement of 15th December 2004. At that time, the proposal was for the development of one plot on which there stood a building of ground plus one storey of 16 fats on a plot of land at Borivali (West) on Gorai Road. A copy of this Agreement is annexed at page 43, Exhibit "E". Clause 21 provided for a 24-month project completion period (page 57). The other details of this Agreement may not be immediately relevant.
9. There then followed a Deed of Rectifcation and Confrmation of 21st January 2008. A copy of this is disclosed by Meeti Developers in its Petition. Clause 3 of this 2008 document Page 10 of 26 11th February 2021 15-18-19-ARBPL8189-2020+.DOC required completion within 24 months of demolition of the old structure. This may perhaps have slightly elongated the time-frame.
10. The Society's members vacated their homes in 2008. All have been in transit accommodation since.
11. It seems that there was an adjacent plot on which there stood a structure with some eight shops. The two plots were then sought to be amalgamated, and this was done. There was now a proposal for a joint redevelopment of both plots such that the shop owners/users would be re-accommodated in commercial units while the residential occupants would get rebuilt habitation. This led to yet another document of 24th January 2011. This date is of passing relevance. It is only necessary to note it because even if we take this as the earliest possible agreement for a joint redevelopment, it appears that till 2017, Meeti Developers did next to nothing to act on it.
12. There now followed yet another Agreement of 13th December 2017 which is styled an Addendum. A copy of this is from 74 at Exhibit "G" of the society's petition. I note that all the members seem to be signatories to this Agreement. In addition the shopkeepers are also signatories.
13. Both sides agree that the arbitration provision is at page 88, in Clause 25. The arbitration is to be in Mumbai, the Courts in which have jurisdiction, and the reference is to 'an Arbitrator', evidently meaning a sole arbitrator and not a arbitral tribunal of three or more Page 11 of 26 11th February 2021 15-18-19-ARBPL8189-2020+.DOC members. Both sides agree that the provision is to be read as to the reference to a sole arbitrator.
14. A few clauses of this Agreement of 13th December 2017 are important. The Agreement itself is undisputed. At page 78, we fnd clause 2 which is a conferment by the society on Meeti Developers of development rights. The relevant portion of this, for the present purposes, is the last line of that clause which pegs the grant of development rights by the society in favour of the developers on a condition, and the condition is that the developers must "unfailingly adhere to the schedule as enumerated in the bar chart annexed" as Annexure "D". I do not have Annexure "D" but there seems to be little doubt that it did not envision a time-period that would last from 2017 to 2021. In any case, there is internal or intrinsic evidence about the actual agreed time-frames. Clause 13 of the Agreement at page 80 (there is some confusion in the numbering of the clauses) says that time is of the essence and the developer categorically accepts its responsibilities for getting the necessary approvals or no objection certifcates on the following schedule:-
(a) an no objection certifcate from MHADA within 90 days, with all necessary permissions, from the date of execution of the Agreement and upon the Society providing the necessary consent in the stipulated format;
(b) an IOD from the MCGM within 90 days of the date of receipt of no objection certifcate from the MHADA;
(c) delivery of possession by the society members within 30 days of the receipt of the IOD;Page 12 of 26
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(d) Commencement certifcate to be obtained by the Developers within 30 days of the IOD;
(e) Actual construction to begin within 15 days of the commencement certifcate from the MCGM;
(f ) And possession within 30 months from the date of the commencement certifcate.
15. The second clause 12 at page 81 tells us that if the developer fails to obtain the approvals and commence construction within the stipulated total time -- computed as 255 days -- in accordance with the preceding clauses (some of which I have summarised above), despite the society ofering vacant premises, the developers sufers two consequences. First there is a monetary penalty on a per diem basis, and if that is not paid the agreement is to stand cancelled. The second clause 13 at page 82 completes the cycle by saying that the developer must obtain an occupation certifcate or part occupation certifcate within 30 months of obtaining the commencement certifcate.
16. The fat owners vacated in 2008 and are out of possession ever since. The shopkeepers have never vacated.
17. The question therefore now is whether it can truly be said that the developers is entitled to any equitable discretionary relief under Section 9. That can only be done if in a matter like this the developers is able to demonstrate prima facie that any delay is not attributable to it and that it has, in other words, fulflled and complied with its contractual obligations.
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18. What I have heard from Mr Davar for the Meeti Developers is two things. First, that the society members "did not vacate". That is incorrect. The suggestion is that the development was held up because the developer did not get vacant possession. But that is, on any reading of it, misleading. The Addendum clearly shows that the delivery of possession was itself contingent upon the developers obtaining the necessary permissions. If the developers did not get those permissions, it could not insist on possession. Some NOC from MHADA was obtained only as late 15th June 2020. In any case, it is futile to pretend now that the residential members are still in occupation; and if by 'did not vacate' it is meant that the shopkeepers did not do so, then there is the non-fulflment of conditions precedent by the developer that have to be factored in.
19. Meeti Developers claims that it has some IOD obtained in January 2021, but this is very seriously contested. Even if this is so, it is certainly not even in substantial compliance with the provisions of the Agreement, assuming that in the performance contractual obligations, absent a specifc contractual provision, there can in law ever be any such thing as "substantial compliance". As a general statement of law, there is either compliance or there is not. The second reason the argument does not commend itself is simply that if the developer believed that it was being hard done by, that is to say it was ready to proceed but was being hampered in doing so for want of possession, then surely one would expect the developer to have come to Court in its own Section 9 Petition at any time between 2017 and 2019. That has not happened either.
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20. The other argument for equitable relief that Mr Davar advances is that the developers has paid compensation -- the amount is not relevant -- though it was 'not bound to do so', and the Society members have accepted it till as late as 2020. Payment of transit rent or displacement compensation is a contractual provision. It is nobody's case that the developers was not bound to pay any transit rent or displacement compensation at all. What the submission really amounts to is that by conduct of parties the Addendum of 13th December 2017 was somehow novated and a modifed Agreement was arrived at. This is not even remotely facie compelling. If there is to be any alteration of the Agreement, clearly it would have to be in writing and this is true whether or not the Agreement contains any specifc provision to that efect. I say this because the Addendum had the signatures of all the society members and the shopkeepers as well. I do not see how it can be said that generalised statement of payment to one or the other or in diferential amounts could lead to a novated Agreement with the diferent terms including an expansion of the time frames applicable to all. The old residential structure still stands. It is empty and vacant. The shopkeepers' structure still stands but they are in occupation. Nothing whatsoever has happened.
21. This is sadly the stark reality of redevelopment project in this city. Society members are entitled to better their living conditions. The property is theirs. They are the owners of it. It may be that in the course of redevelopment they are required to confer certain rights on a developer. After all, they are not able to aford the costs of reconstruction themselves. Allowing a developer the right to sell free sale units is compensation for the developers putting up the Page 15 of 26 11th February 2021 15-18-19-ARBPL8189-2020+.DOC rehabilitation units to re-accommodate members. This does not confer by itself in every case rights in the land in favour of a developer. There are equitable considerations to be kept in mind. A developer is in search of only thing: the profts that it will make from the project. The interest of society members are entirely diferent. What they are looking at is better homes, ones long promised to them, but ones that remained an unfulflled dream forever receding in time.
22. The contest is therefore between what is a essentially human displacement problem and the purely proft-oriented objective. If there is to be an equitable balance, then there can be no doubt on which side a Court of equity will lean. The developers may have a claim to be made in damages. It is free to pursue that claim. That cannot give it rights in specie over the property itself nor can it subject the full ownership rights of the society to its demands. Not only is the developer entirely proft-oriented, and that necessarily matters that a developer can be compensated in money terms, immediately putting them out of the reach of any interim relief, but they have also cannot said to have acquired any direct interest in the land itself. Indeed, the only situation in which a developer may be able to get some relief is if it can demonstrate that it has played it 'by the book', as it were, and there is no default on its part.
23. An attempt, however, on the other hand to choke up a development to leverage changes in development policy and available FSI to maximise proft is a strategy that comes at a real cost to society members, and is a stratagem that no Court of equity can, will or should ever countenance for a minute.
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24. The strategy is plain and, like the Emperor's clothes, it bares all. The idea is to keep the society and its members hanging by a thread, stuck in an endless cycle of delayed payments and part payments, all the while ostensibly keeping the contract 'alive', claiming rights in it, and waiting to squeeze every last drop of available buildability out of the project only to maximize profts.
25. If therefore today Meeti Developers is unable to demonstrate compliance, the fact it may have made some payment in between will be of no avail. The only way it can stave of its ejectment as a developer is to demonstrate complete and exact compliance with its contractual obligations under the contract. This it is clearly unable to do.
26. The society for its part does not have to do very much more then demonstrate the lack of compliance by the developers. The society is after all the owner of the property and its title is paramount. The society terminated the Agreement on 12th November 2020. I cannot understand why the developers even then sat idly by and did not think to come to Court till as late as 18th January 2021. That delay alone probably tells us all that we need to know about the bona fdes of the counter petition by Meeti Developers.
27. On 1st December 2020 the society invoked arbitration.
28. There is a fnal argument from Mr Davar that the termination is not in the correct form or is not by persons authorised to efect it.
Page 17 of 2611th February 2021 15-18-19-ARBPL8189-2020+.DOC That is not a question that will delay a Section 9 Court. The matter may be taken in arbitration.
29. I return now to the prayers. I do not see, on this reasoning, how any of the prayers sought by Meeti Developers can be granted. Prayer clause (d) of the Meeti Developers' Petition seeks a restraint against the society from approaching the developers, architect, contractors, labourers etc. Given the fact that the developer has done nothing, I do not even believe is has any contractors or labourers. It may have architects. Mr Cama makes a statement that the society has appointed a new developer which has its own architects and the society has no need of to approach Meeti Developers' architects for any purpose. The statement is noted and accepted.
30. Mr Cama readily accepts that some of the prayers that he presses for Section 9 in his Petition from prayer clauses (c) to (j) are in the nature of mandatory directions or injunctions. He is mindful of the decision of the Supreme Court in Samir Narain Bhojwani v Aurora Properties And Investments And Another.1 This made it clear that there are certain requirements before such order can be made. Not only must there be a prima facie case, there must be an exceptionally strong prima facie case. That requirement I believe is met in the present circumstances. The facts speaks for themselves and the way the dates fall, the exceptional prima facie case is made out. The second requirement is based on the earlier decision of the Supreme Court in Dorab Cawasji Warden v Coomi Sorab Warden. 2 1 (2018) 17 SCC 203.
2 (1990) 2 SCC 117.
Page 18 of 2611th February 2021 15-18-19-ARBPL8189-2020+.DOC This tells us that the purpose of a mandatory order is to restore a status quo ante i.e. to put parties back into a position in which they stood and not to create a new order of things. This Court has granted such reliefs before: see: Solaris Developers Pvt Ltd v Eversmile Cooperative Housing Society Ltd.3
31. For our present purposes, this is an interesting application. What the society says is simply that the developer has done nothing. It has some materials on site. That is all and that is the status quo in fact on site. What the developer is doing is putting some local goons and hoodlums on site to intimidate the society. The developer has no other presence on site whatsoever. These allegations are of course denied by Mr Davar on instructions.
32. The facts however clearly demonstrate that there is no development work within the meaning of the defnition of 'development' under the Maharashtra Regional Town and Planning Act at all. That is the status quo and that is the status quo ante that must be preserved as against Meeti Developers. It must be therefore logically follow that the kind of order that Mr Cama seeks must be granted on the case that he has made out.
33. Can a Section 9 Court order a relief that is in the nature of fnal relief even at the interim stagen The Supreme Court itself has said in Deoraj v State of Maharashtra And Ors 4 that this can be done in a given case. I believe this is one such.
3 Arbitration Petition (L) No. 593 of 2019, decided on 7th June 2019. 4 Civil Appeal No. 2084 of 2004, decided on 6th April 2004.
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34. As to the other arguments canvassed by Mr Davar in regard to the equitable consideration that he submits must weigh in the developer's favour, I believe every single one of these has been considered and answered against him by the decision of RD Dhanuka J in the The Jal Ratan Deep Co-operative Housing Society Limited v Kumar Builders Mumbai Realty Private Limited. 5 The factual situation may have been slightly diferent because there was ongoing arbitration there. But the reasoning of the Court, especially in paragraphs 28 and 29, must apply to the facts of this case.
35. I am persuaded to the prima facie view that the society has a very good chance of succeeding in the arbitral proceedings. The various defaults and delays on the part of the Respondent developers militate against the grant of any relief in its favour. There is no legal or statutory right in its favour in regard to the property. What the developer really seeks is an injunction against an owner from enjoying the full benefts of that ownership including the right to develop and exploit its property's full potential. This the developer cannot do once it is in breach of its contractual obligations under an Agreement with the society. It is really as simple as that.
36. In this view of the matter, there will be an order in the society's Petition in terms of prayer clauses (c) to (j) above. As regards prayer clause (j) all authorities at MHADA and MCGM and elsewhere are directed by virtue of this order not to insist on a NOC from Meeti Developers, its architect, engineer, surveyor or consultant as a condition or a pre-requisite to processing any 5 Arbitration Petition (L) No. 219 of 2015, decided on 24th June 2015.
Page 20 of 2611th February 2021 15-18-19-ARBPL8189-2020+.DOC application for development, permission or NOC that the society may make itself or through any other developer/s that it chooses to appoint.
37. Meeti Developers is, with immediate efect, of site in all respects. It will be entitled to remove its goods and materials, if any, from the site with 24 hours' prior notice to the Advocates for the Petitioners. Without such notice, no person on behalf of Meeti Developers is to enter upon the two project sites i.e. the residential building plot or the shopkeepers' plot.
38. The statement made by Mr Cama in regard to Meeti Developers' architects and consultants is noted and accepted on society's behalf as an undertaking to the Court.
39. At this stage, both sides request that their respective Section 9 Petition be referred to the arbitration of a person appointed by this Court. I will permit this in part. I am not permitting Meeti Developers to re-agitate these issues in arbitration. Its petition for interim relief is dismissed. It may seek any other relief, including in damages and for security for its claim, in arbitration, but not the reliefs it has sought before me today. It is clarifed that the Respondent is at liberty to challenge the termination of the Agreements by the society and may do so in arbitration. The Society will be at liberty to press for prayer clauses (a), (b), (k) and (l) of the present Section 9 Petition before the learned Sole Arbitrator. Before anyone cries wolf and starts ringing alarm bells, let me be clear about what I am doing. I am not rejecting or dismissing any final Page 21 of 26 11th February 2021 15-18-19-ARBPL8189-2020+.DOC relief or remedy the developer may have. I am dismissing the prayer for interim relief, pending arbitration. This is, after all, a Petition under Section 9, claiming interim protection, pending arbitration. I have held that the developer is not entitled to any such protection. That is all. Conversely, I have held that the Society is entitled to the interim protection it seeks, for the reasons set out above.
40. The Petition by Meeti Developers is thus dismissed.
41. I will appoint Mr Cyrus Ardeshir, learned Advocate of this Court as the sole Arbitrator to take up the diferences and disputes between the parties under the Addendum dated 13th December 2017 read with the Development Agreement of 15th December 2004, the Deed of Rectifcation and Confrmation of 21st January 2008 and the Agreement of 24th January 2011.
TERMS OF APPOINTMENT
(a) Appointment of Arbitrator: Mr Cyrus Ardeshir, learned Advocate, is hereby nominated to act as a Sole Arbitrator to decide the disputes and diferences between the parties under the documents referred to above.
(b) Communication to Arbitrator of this order:
(i) A copy of this order will be communicated to the learned Sole Arbitrator by the Advocates for the Petitioner within one week from the date this order is uploaded.Page 22 of 26
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(ii) The Advocates for the Petitioner will forward an ordinary copy of this order to the learned Sole Arbitrator at the following postal and email addresses:
Arbitrator Mr Cyrus Ardeshir Address Ofce No. 217 Vardhaman Chambers, 2nd foor, Cawasji Patel Street, Fort, Mumbai 400 001. Mobile 98200 97671 Email [email protected]
(c) Disclosure: The learned Sole Arbitrator is requested to forward, in hard copy or soft copy (or both), the necessary statement of disclosure under Section 11(8) read with Section 12(1) of the Arbitration Act to Advocates for the parties as soon as possible. The Advocates for the Petitioners will arrange to fle the original statement in the Registry. If the statement is forwarded in soft copy, a print out of the covering email is also to be fled in the registry.
(d) Appearance before the Arbitrator: Parties will appear before the learned Sole Arbitrator on such date and at such place as the learned Sole Arbitrator nominates to obtain appropriate directions in regard to fxing a schedule for completing pleadings, etc.
(e) Contact/communication information of the parties:
Contact and communication particulars are to be provided by both sides to the learned Sole Arbitrator.Page 23 of 26
11th February 2021 15-18-19-ARBPL8189-2020+.DOC The information is to include functional email addresses and mobile numbers.
(f ) Section 16 application: The respondent is at liberty to raise all questions of jurisdiction within the meaning of section 16 of the Arbitration Act. All contentions are left open.
(g) Interim Application/s:
(i) Subject to this order, liberty to the parties to
make an interim application or interim
applications including (but not limited to) interim applications under Section 17 of the Arbitration & Conciliation Act, 1996 before the learned Sole Arbitrator. Any such application will be decided in such manner and within such time as the learned Sole Arbitrator deems ft.
(ii) The Society may press its prayers (a), (b), (k) and (l) in an application under Section 17 before the learned Sole Arbitrator.
(iii) The developer may fle its claim or counter-
claim for damages or other relief as advised, including challenging the termination, and seek suitable interim reliefs such as disclosure or security, but not the present reliefs in its Section 9 petition.
Page 24 of 2611th February 2021 15-18-19-ARBPL8189-2020+.DOC
(iv) The learned Sole Arbitrator is requested to dispose of all interim applications at the earliest.
(h) Fees: The arbitral tribunal's fees shall be governed by the Bombay High Court (Fee Payable to Arbitrators) Rules, 2018.
(i) Sharing of costs and fees: Parties agree that all arbitral costs and the fees of the arbitrator will be borne by the two sides in equal shares in the frst instance.
(j) Consent to an extension if thought necessary. Parties immediately consent to a further extension of up to six months to complete the arbitration should the learned Sole Arbitrator fnd it necessary.
(k) Venue and seat of arbitration: Parties agree that the venue and seat of the arbitration will be in Mumbai.
(l) Procedure: These directions are not in derogation of the powers of the learned Sole Arbitrator to decide and frame all matters of procedure in arbitration.
42. Both Section 9 Petitions are disposed of in these terms.
43. Both sides are at liberty to press for the costs of these Petition and interest on costs if permissible in law in the arbitration proceedings.
44. Leave to amend to correct the cause title of the society's Petition to show the correct name of the Respondent.
Page 25 of 2611th February 2021 15-18-19-ARBPL8189-2020+.DOC
45. Mr Davar seeks leave to amend. That is not necessary. The developers may make an application or a claim with the necessary relief including the challenge to termination before the Arbitrator.
46. The Arbitration Application (L) No. 2614 of 2021 and Interim Application (L) No. 2034 of 2021 are also disposed of.
47. This order will be digitally signed by the Personal Assistant of this Court. All concerned will act on production of a digitally signed copy of this order.
(G. S. PATEL, J) Page 26 of 26 11th February 2021