Karnataka High Court
M/S Vasathi Housing Limited vs Mr. A. T. Babu Rao on 27 June, 2018
Author: B.Veerappa
Bench: B. Veerappa
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 27TH DAY OF JUNE, 2018
BEFORE
THE HON'BLE MR. JUSTICE B. VEERAPPA
CIVIL MISCELLANEOUS PETITION No.54/2018
BETWEEN:
M/S VASATHI HOUSING LIMITED,
(FORMERLY KNOWN AS
M/S VASATHI HOUSING AND
INFRASTRUCTURE PVT LTD)
A COMPANY INCORPORATED UNDER THE
COMPANIES ACT 1956,
PRESENTLY HAVING ITS REGISTERED OFFICE
AT NO. 8-2-269/S/41,
SAGAR SOCIETY, ROAD NO.2,
BANJARA HILLS, HYDERABAD - 500 034.
REPRESENTED BY ITS AUTHORIZED
SIGNATORY, SRI P.V.RAVINDRA KUMAR,
S/O SRI P.V.RATAM,
AGED 61 YEARS.
... PETITIONER
(BY SRI DEVARAJ K. S., ADVOCATE)
AND:
1. MR. A. T. BABU RAO
S/O LATE SRI A THUKARAMA RAO,
AGED ABOUT 67 YEARS,
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2. MR. A.T. SHANKAR RAO,
S/O LATE SRI A. THUKARAMA RAO,
AGED ABOUT 58 YEARS,
BOTH RESIDING AT NO.6/6,
H.B.SAMAJA ROAD CROSS,
BASAVANAGUDI,
BENGALURU - 560 004.
3. M/S ANU BUILDERS AND DEVELOPERS,
A PARTNERSHIP FIRM,
HAVING ITS OFFICE AT NO.119,
4TH CROSS, MALLAPPA LAYOUT,
KALYAN NAGAR,
BENGALURU - 560 043.
REPRESENTED BY
ITS MANAGING PARTNER
MR. M. VENKATARAM.
4. MR. SATHYA TEJA,
S/O SRI K. MUNIYAPPA,
AGED ABOUT 42 YEARS,
RESIDING AT NO. 83/1,
MALLAPPA LAYOUT,
BABUSAPALYA POST,
KALYAN NAGAR,
BENGALURU - 560 043.
5. MRS. SOWBHAGYA,
W/O SRI B.S.VIJAYA KUMAR,
AGED ABOUT 39 YEARS,
6. MR. ASHOK KUMAR,
S/O SRI NARAYANA SWAMY,
AGED ABOUT 30 YEARS,
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THE RESPONDENT NOS. 5 AND 6
ARE RESIDING AT NO. 163, 4TH CROSS,
MALLAPPA LAYOUT,
BABUSAPALYA POST, KALYAN NAGAR,
BENGALURU - 560 043.
7. MR. M. VENKATRAM,
S/O SRI K. MUNIYAPPA,
AGED ABOUT 48 YEARS,
8. MR. M. MYLARI,
S/O SRI K. MUNIYAPPA,
AGED ABOUT 44 YEARS,
RESPONDENT NOS. 7 AND 8 ARE
RESIDING AT NO.83/1,
MALLAPPA LAYOUT,
BABUSAPALYA POST,
KALYAN NAGAR,
BENGALURU - 560 043.
... RESPONDENTS
(BY SRI R. B. PRAKASH, ADVOCATE FOR R1(ABSENT);
R2 TO R8 ARE SERVED BUT UNREPRESENTED)
THIS CMP IS FILED UNDER SECTION 11(6) OF THE
ARBITRATION AND CONCILIATION ACT 1996, PRAYING TO
APPOINT AN ARBITRATOR AND IN PURSUANCE TO THE
ARBITRATION AGREEMENTS DATED: 06.08.2010 VIDE
ANNEXURES-B & C RESPECTIVELY AND THE INVOCATION
OF THE ARBITRATION CLAUSE FOR ADJUDICATING THE
DISPUTES BETWEEN THE PETITIONER AND THE
RESPONDENTS.
THIS CMP COMING ON FOR ADMISSION THIS DAY,
THE COURT MADE THE FOLLOWING:-
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ORDER
The petitioner filed the present Civil Miscellaneous Petition under the provisions of Section 11(6) of the Arbitration and Conciliation Act, 1996 to appoint an Arbitrator in pursuance to the arbitration agreements dated 6.8.2010 as per Annexures-B and C and invocation of the arbitration clause for adjudicating the disputes between the petitioner and the respondents.
2. It is the case of the petitioner that on 6.8.2010 the petitioner entered into two Joint Development Agreements ('JDAs' for short) with Respondent Nos.1 and 2 in respect of 'A' schedule property and Respondent Nos.4 to 8 in respect of 'B' schedule property, for developing the adjacent 'A' and 'B' schedule properties into multistoried residential apartments. Under the JDAs, the petitioner has paid a sum of Rs.5,00,000/- to Respondent Nos.1 and 2 and a sum of Rs.2,60,00,000/- to Respondent Nos.4 to 8 5 towards interest free refundable security deposit. On 3.11.2010, intimation letter issued by the BBMP for amalgamation of the schedule 'A' and 'B' properties into schedule 'C' property. On 10.5.2013 licence was issued by the BBMP to construct a residential apartment complex upon the schedule 'C' property. Thereafter on 16.5.2013 petitioner and respondents entered into supplementary cum allocation agreement for allocation of the apartments. Petitioner completed construction of the terrace slab work with respect to A,B and C blocks in the months of July 2016, May 2016 and February 2017 respectively and have completed block work with respect to A,B and C blocks in the months of October 2016, July 2016 and April 2017 respectively. The petitioners have completed internal plastering work of A,B and C blocks in the months of November 2016, October 2016 and June 2017 respectively. Further, the petitioners have completed external plastering work of A,B and C blocks in the months of January-2017, 6 December-2016 and July-2017 respectively. Likewise, painting work has also been completed with respect to A,B and C blocks in the months of April 2017, March 2017 and September 2017 respectively.
3. Despite completion of the work as mentioned above, respondents failed to refund the security deposit made by the petitioner. Therefore the petitioner by letter dated 7.11.2017 called upon the respondents to pay the refundable security deposit together with recoverable deposits paid towards BWSSB, BESCOM. Clubhouse and Smart Community, in all amounting to Rs.9,10,36,648/-. Thereafter notice issued by the petitioner demanding Rs.14,71,50,000/- from the respondents, on account of various defaults on the part of the respondents. Thereafter in response to the letter dated 7.11.2017, the Respondent Nos.1 and 2 sent a reply dated 2.1.2018 to the petitioner, stating that, in terms of the Joint Development Agreements dated 6.8.2010, the stipulated period for completing the 7 construction of the apartment complex had expired on 6.12.2013. Therefore, Respondent Nos.1 and 2 claimed compensation at the rate of Rs.5/- per square feet on their respective share in the project. Respondent Nos.3 to 8 also issued a reply notice asking the petitioner to furnish details about the work and denying having to pay the refund and also requesting the petitioner to settle the issue through conciliation. Inspite of the legal notice issued by the petitioner to the respondents, they have not come forward for settlement. Therefore, petitioner is before this Court.
4. The Respondent Nos.2 to 8 are served, but unrepresented. When the matter came up before this Court on 20.6.2018, learned counsel for Respondent No.1 was absent and in order to give one more opportunity, the matter was adjourned by one week. Accordingly, the matter is listed today. Even today, none appeared for Respondent No.1. Therefore this Court has no other 8 option except to decide the case on merits after hearing the learned counsel for the petitioner.
5. I have heard Sri K.S. Devaraj, learned counsel for the petitioner.
6. Sri K.S. Devaraj, learned counsel for the petitioner reiterating the averments made in the petition has contended that there is no dispute with regard to Joint Development Agreements dated 6.8.2010 entered into between the petitioner and the respondents in respect of 'A' and 'B' schedule properties. He also contended that there exists arbitration clause in both the JDAs. Clause 22 is the arbitration clause in one JDA, whereas Clause 19 is the arbitration clause in the 2nd JDA. Inspite of issue of legal notice, the respondents have not come forward to settle the dispute and Respondent Nos.3 to 8 in reply requested to settle the issue through conciliation by appointing the sole 9 Arbitrator. Therefore he sought to allow the present Civil Miscellaneous Petition.
7. I have given my anxious consideration to the arguments advanced by the learned counsel for the petitioner. It is an undisputed fact that petitioner entered into one JDA with Respondent Nos.1 and 2 in respect of 'A' schedule property and another JDA with Respondent Nos.4 to 8 in respect of 'B' schedule property. Under the JDAs, the petitioner has paid a sum of Rs.5,00,000/- to Respondent Nos.1 and 2 and a sum of Rs.2,60,00,000/- to Respondent Nos.4 to 8 towards interest free refundable security deposit. A dispute arose between the parties and therefore the petitioner has invoked arbitration clause in the JDAs entered into between the parties and issued the legal notice as contemplated under the provisions of the Act.
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8. In view of the aforesaid reasons, there is no impediment to appoint the sole Arbitrator to resolve the disputes between the parties in respect of two Joint Development Agreements dated 6.8.2010 entered into between the parties.
9. Accordingly, the Civil Miscellaneous Petition is allowed. Sri S. Siddalingesh, former District Judge is appointed as the sole Arbitrator to resolve the disputes arising out of two JDAs. dated 6.8.2010 entered into between the parties, in accordance with law.
Registry is directed to send a copy of this order to Sri S. Siddalingesh, former District Judge and Respondent Nos.1 to 8 as well as to the Arbitration Centre for reference.
Sd/-
JUDGE gss/-