Bombay High Court
Gurukrupa Basics vs Greenscape Developers Pvt. Ltd on 13 January, 2020
Equivalent citations: AIRONLINE 2020 BOM 1478
Author: G. S. Patel
Bench: G.S. Patel
33-CARBPL757-19.DOC
Atul
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
IN ITS COMMERCIAL DIVISION
COMM ARBITRATION PETITION (L) NO. 757 OF 2019
Gurukrupa Basics ...Petitioner
Versus
Greenscape Developers Pvt Ltd ...Respondent
Mr Aseem Naphade, with Pushkal Mishra, i/b Utangale & Co., for
the Petitioner.
Dr B Saraf, i/b Abhijeet A Devkhile, for the Respondent.
CORAM: G.S. PATEL, J.
DATED: 13th January 2020 PC:-
1. The Petition is under Section 37 of the Arbitration and Conciliation Act 1996. It challenges an interim order dated 20th June 2019 of the learned sole Arbitrator made on an application under Section 17 of the Arbitration and Conciliation Act 1996. By that order, the learned sole Arbitrator continued a previous order passed by the Principal District Judge, Thane in Miscellaneous Application No. 257 of 2016 on 5th July 2018. That order of the Principal District Judge restrains the Respondent (represented today by Dr Saraf ) from creating third party interests or rights in fve fats, namely Flat Nos. 502, 503, 601, 701 and 702. By the impugned order, (which says its observations are limited to that order alone), Page 1 of 4 13th January 2020 ::: Uploaded on - 14/01/2020 ::: Downloaded on - 14/01/2020 23:58:52 ::: 33-CARBPL757-19.DOC the learned sole Arbitrator simply continued the Principal District Judge's order.
2. A brief background is like this. CIDCO foated a tender in regard to the allotment of a plot of land of 2,064.75 sq mtrs at Nerul. The Petitioner and the Respondent entered into a Joint Development Agreement dated 16th December 2011 to develop this land. Certain clauses of this agreement immediately outline the precise rights and obligations of the parties. Mr Naphade for the Petitioner has drawn attention to clause (e) at page 135 and clauses 3(xi) and 3(xiv) to contend that the Petitioner had a right to participate in the development and was not limited to the proftt sharing. For our present purposes clause (e) and its immediately succeeding clause (f ) should sufce. They read:
"e. Prior to the submission of the said ofer by the POFP to the CIDCO Ltd, both the POFP & the POSP had agreed to develop the said plot jointly wherein both the POFP & the POSP shall contribute 50% of all the premiums, expenses, fees, deposits that shall be incurred for the development of the said plot, upto the stage of obtaining the Occupancy Certifcate and handing over the possession of the premises constructed therein to their respective Purchasers and formation of the Cotoperative Society and execution of the Lease Deed / Deed of Assignment in favour of the Cotoperative Society that shall be formed.
f. It was further agreed that the POFP shall, on behalf of the Joint Venture, take active interest in all aspects relating to the development of the said plot and hence the proft sharing in the said Joint Page 2 of 4 13th January 2020 ::: Uploaded on - 14/01/2020 ::: Downloaded on - 14/01/2020 23:58:52 ::: 33-CARBPL757-19.DOC Venture shall be in the ratio of 60:40, i.e.,60% of the total proft shall be retained by the POFP and 40% of the total proft shall be retained by the POSP."
(Emphasis added)
3. The present Petitioner is the POSP, or the Party of the Second Part. As the emphasized portion clearly indicates, the Petitioner had a right in the profts of the enterprise and his rights were defned in percentage terms. He was entitled to 40% of those profts. About this, there is no dispute at least for the present.
4. Dr Saraf contends that the Petitioner did not fulfl its obligations under clause (e) but I am not immediately concerned with that. Clauses 3(xi) and 3(xiv) only say that the parties should cooperate in the development. These clauses, emphasized by Mr Naphade, do not indicate that the Petitioner had an in specie right to any defned area in the redevelopment. Yet, that was precisely the nature of the application before the learned sole Arbitrator under Section 17 where the Petitioner sought an injunction against the Respondent from creating any third party rights etc in respect of an unsold area of 13,296 sq ft.
5. The District Court considered the Section 9 Application at some length. Its order dated 5th July 2018 is from pages 89t105. In paragraph 17, the learned Principal District Judge, Mr Vinay G Joshi, found, and in my view absolutely correctly, that the intervention of the Court was necessary to protect the Petitioner's interest. He then went on to address to the nature of that interim Page 3 of 4 13th January 2020 ::: Uploaded on - 14/01/2020 ::: Downloaded on - 14/01/2020 23:58:52 ::: 33-CARBPL757-19.DOC relief and in paragraph 18 concluded -- again, in my view, correctly
-- that while the agreement provides that the Petitioner is entitled to a 40% share in the proft, this does not mean that 40% of the property is to come to his share. This reasoning is fawless. The Petitioner carried this matter in appeal but in those appellate proceedings that claim was referred to the learned sole Arbitrator for decision as an application under Section 17.
6. It is impossible to fnd fault with the order of the learned sole Arbitrator, one that continues the order passed under Section 9 by the learned Principal District Judge. I may note that the learned sole Arbitrator explicitly stated that he was inclined to continue the Principal District Judge's order until the disposal of the arbitration proceedings and that is in fact what he proceeded to do.
7. Mr Naphade is unable to demonstrate the slightest perversity in the order. It is also not shown that this order is even implausible let alone sufering from any infrmity approaching the standard of Wednesbury unreasonableness. The mandate of the Arbitration Act is clear. These are not orders to be interfered with for the asking. The overriding principle behind Section 5 to minimize judicial interference must be respected.
8. I can fnd no merit in the Petition. It is dismissed. There will be no order as to costs.
(G. S. PATEL, J) Page 4 of 4 13th January 2020 ::: Uploaded on - 14/01/2020 ::: Downloaded on - 14/01/2020 23:58:52 :::