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February 10, 2026 Ashwini Vallakati F-J-ARBAP-103-2025+.doc
24. Each of the named arbitrators has declined the arbitral mandate. This has led to the Section 11 proceedings owing to the rejection of consent by the Society to appointing an arbitrator.
25. The individual members of the Society, each of whom is a party to an arbitration agreement, have formed the Society, and the Society claims that it has no privity to any arbitration agreement with the Developer, or with the Temple Trust. On the other hand, the Developer contends that the arbitration agreement with each and every member of the Society would translate into an arbitration agreement with the Society, since each of the constituents of the Society, has an arbitration agreement with the Developer. The Temple Trust claims that it is claiming through the Developer to enforce its rights, which have clearly been recognised in each of the agreements between the Developer and each member of the Society.
26. The Section 8 Application was allowed by the Learned City Civil Court. I find that the each of the Society's constituents has privity to the arbitration agreement with the Developer, and the Society seeks a declaration that the gift of land made to the Temple Trust, which is clearly recorded in the agreements, that each and every member of the Society has signed, is sought to be declared as illegal. On the face of it, February 10, 2026 Ashwini Vallakati F-J-ARBAP-103-2025+.doc this makes the Society a veritable party to the arbitration agreement. While the Society disclaims privity to the arbitration agreement with the Developer, each and every agreement for sale executed by each and every constituent of the Society contains an identical arbitration agreement.
30. The Society has contended that it is not a veritable party to the agreements and that there is no mutuality of intention among the members of the Society to have their disputes resolved by arbitration. This is a mere statement of a formal objection that entirely lacks substance. The very cause for the Society's existence is the collection of interests of its members. Each and every member has privity to the arbitration agreement executed with the Developer. Each such counterparty to the arbitration agreement with the Developer has come together to form the Society. Therefore, the very cause of the Society's existence is the extension of the identical interests enjoyed by its members who came together to form the Society. In fact, each and every bilateral agreement between the Developer and each member of the Society records that the Society would be formed. The Society's incorporation is a logical extension of what was contemplated in the agreement containing the arbitration clause. For the Society, whose very reason for existence is rooted in the agreements containing the arbitration clause, to contend that the arbitration clause would not entail the Society being a veritable party, rings hollow.
31. It is also contended on behalf of the Society that there is no February 10, 2026 Ashwini Vallakati F-J-ARBAP-103-2025+.doc subsequent agreement between the Developer and the Society ratifying the arbitration agreement. This is unnecessary in the facts of this case, since the very constitution of the Society is contemplated in the bilateral agreements between the Developer and each counterparty who is now a member of the Society. The very formation of the Society is a facet of these bilateral agreements. The fact that the Society would be formed is an action contemplated in the agreements between the Developer and each member of the Society. In the factual matrix of this case, the very existence of the Society is an outcome of the agreements between the constituents of the Society and the Developer, with the formation of the Society being an action pursuant to these very agreements. Arbitrability Issues: