Bombay High Court
Bandra (East vs Chembur Nishant Co-Operative on 27 November, 2012
Bench: R.D. Dhanuka
.. 1 .. ARBAP-248/12
IN THE HIGH COURT OF JUDICATURE AT BOMBAY.
ORDINARY ORIGINAL CIVIL JURISDICTION
ARBITRATION APPLICATION NO.248 OF 2012
G.A.BUILDERS PRIVATE LIMITED, )
a company registered under the provisions )
of the Companies Act, 1956 and a Group )
Company of RNA Builders (A.A.) and having )
its registered office at RNA Corporate Park, )
next to Collector Office, Govt. Colony,
V/s.
Bandra (East), Kala Nagar, Mumbai - 400 051. ) ... Applicant.
CHEMBUR NISHANT CO-OPERATIVE )
HOUSING SOCIETY LIMITED, )
a society registered under the Maharashtra )
Co-operative Societies Act, 1960, having )
its registered office at Building No.32, )
Subhash Nagar, Chembur, )
Mumbai 400 071. ) ... Respondent.
Mr Pratik Sakseria, with Ms. Nidhi Singh i/b M/s Vidhi Partners for the
Petitioner.
Mr Niranjan Shimpi i/b Kishore G. Nagavekar for the Respondent.
CORAM : R.D.DHANUKA J.
DATED : NOVEMBER 27, 2012.
P.C.
1. By this application filed under Section 11 of the Arbitration and
Conciliation Act 1996, applicant seeks appointment of Arbitrator relying upon
Clause-47 of the alleged agreement dated 27 February 2010.
Asmita 1/6
.. 2 .. ARBAP-248/12
2. Respondent Society is owner of a plot of land adm.896.98 sq.metres
along with building thereon being building no.32, known as 'Chembur Nishant
Co.Op. Housing Society Ltd', bearing Survey No.67 to 71, C.T.S. No. 826 situate
at Subhash Nagar, Chembur. The building was in need of urgent repairs. It is
the case of the applicant that the Society had proposed to redevelop the property.
By letter dated 23 January 2009, applicant gave terms of the development to the
respondent Society. On 1 February 2009, Special General Meeting of the
respondent Society came to be held in which, members unanimously gave their
consent and approval to the development proposal to be furnished by the
applicant. It is the case of the applicant that on 27 February 2010, applicant and
respondent Society entered into development agreement, whereby respondent
Society agreed to grant development rights in respect of the property to the
applicant.
3. It is the case of the applicant that the applicant paid a sum of Rs.
1,54,82,752/- to Maharashtra Housing & Area Development Authority (MHADA)
for seeking necessary application/permission for allotment of additional buildable
area. It is not in dispute that applicant submitted Confirmation Deed dated 17
June 2011 and got the said alleged agreement registered unilaterally.
Asmita 2/6
.. 3 .. ARBAP-248/12
4. The applicant, thereafter by letter dated 30 September 2011 called
upon the Society to execute irrevocable Power of Attorney in its favour in
accordance with the said alleged agreement dated 27 February 2010. It is the
case of the Society that Society has not received any such alleged letter dated 30
September 2011.
5. The applicant thereafter issued notice invoking alleged arbitration
clause and filed this application for appointment of Arbitrator.
6. The respondent Society has filed detailed affidavit-in-reply. It is the
case of the Society that a draft of the proposed agreement to be finalized was
furnished by the applicant to the Society which was undated consisting many
blanks. It is submitted that the applicant had obtained signature of the
members of the Society on the said draft copy of the proposed agreement to be
finalized, by misrepresenting them that a member would get partial amount from
the developer at the time of execution. However, none of the members received
any amount from the applicant. It is averred in the affidavit that the applicant
obtained consent of the members by playing fraud upon them. It is averred that
the agreement being relied upon by the applicant is unilaterally registered with
Deed of Confirmation, which is a manipulated document and is different than
the copy of the agreement which was furnished to the respondent Society. It is
Asmita 3/6
.. 4 .. ARBAP-248/12
averred that petitioner is relying upon a fabricated document and is thus
unenforceable as against the respondent Society which the Society and/or its
members have not executed at any point of time.
7. The learned counsel appearing for the applicant submits that it is not
in dispute that Society passed a resolution to enter into development agreement
with the applicant. It is submitted that there is no dispute that copy of agreement
being relied upon by the Society consists seal of the Society and also signature of
office bearers. It is submitted that initial consideration agreed to be paid by the
applicant to the members was though tendered by the applicant to the members,
the same was not accepted. It is submitted that pursuant to the agreement, the
applicant has taken steps and has paid a substantial amount to MHADA. It is
submitted that since the respondent Society has refused to comply with their part
of obligation, dispute has arisen and thus, matter is required to be referred to
arbitration under Clause-47 of the agreement.
8. The learned counsel appearing on behalf of the respondent Society on
the other hand, submits that applicant has manipulated and fabricated the
material clause of the agreement as well as has played fraud in execution of the
agreement. It is submitted that only a draft agreement was furnished to the
respondent Society. Applicant never paid any consideration amount. The final
Asmita 4/6
.. 5 .. ARBAP-248/12
terms and conditions of the agreement were never agreed. According to
respondent Society, the terms and conditions of the final Deed of Development
Agreement were not concluded and thus, no agreement has been arrived at. The
learned counsel for the respondent Society invited my attention to Clause-21 of
the draft agreement, which was furnished to the Society, which has been scored
off by the applicant in the agreement dated 27 February 2010 relied upon by the
applicant. The learned counsel invited my attention to various recitals and other
clauses of the alleged agreement to demonstrate that various blanks which were
found in the draft development agreement furnished to the respondent Society
had been subsequently filled up. It is submitted that after furnishing the draft of
the agreement proposed to be entered into, the applicant never furnished any
document nor any terms were finalized. It is submitted that thus, when there are
serious allegations of forgery, manipulation and fabrication in the material terms
of the agreement and the agreement not having been concluded, dispute cannot
be referred to the Arbitrator and such dispute can only be decided by the Civil
Court.
9. On my query raised to the learned counsel appearing for the applicant,
the learned counsel fairly admitted, on taking instructions, that copy of the
agreement dated 27 February 2010 relied upon by the applicant, was never
Asmita 5/6
.. 6 .. ARBAP-248/12
furnished to the respondent Society. It is admitted position that at no point of
time further consideration was offered to the Society. It is also admitted
position that before signing the Deed of Confirmation and getting the document
registered, Society was never informed. It is also admitted position that before
making payment to MHADA, applicant never obtained consent from the
respondent Society.
10.
The record produced by both the parties indicates that there is serious
dispute about existence of arbitration Agreement. It is admitted position that
there is difference in the copy of the agreement relied upon by the applicant and
the copy furnished to the respondent Society. The copy, admittedly furnished to
respondent Society, does not bear signature of the applicant whereas copy relied
upon by the applicant bears signature of the applicants.
11. In view of these serious allegations of forgery, fabrication and
manipulation and in the circumstances aforesaid, I am of the view that such
dispute cannot be referred to arbitration and can be tried only by Civil Court.
Application is therefore rejected.
12. There shall be no order as to costs.
( R.D.DHANUKA, J.)
Asmita 6/6
