Trehan Promoters & Builders Pvt. ... vs Welldone Technology Parks ...
2009 Latest Caselaw 3560 Del

 *               IN THE HIGH COURT OF DELHI AT NEW DELHI


                                                                       Date of Reserve: August 31, 2009
                                                                      Date of Order: September 04, 2009

+OMP 507/2009
%                                                         04.09.2009
    Trehan Promoters & Builders Pvt. Ltd.                 ...Petitioner
    Through: Mr. Vikas Dhawan and Mr. S.P. Das, Advocates

          Versus

          Welldone Technology Parks
          Development Pvt. Ltd.                                                               ...Respondent
          Through: Nemo


          JUSTICE SHIV NARAYAN DHINGRA

1.        Whether reporters of local papers may be allowed to see the judgment? Yes.

2.        To be referred to the reporter or not?                                                                    Yes.

3.        Whether judgment should be reported in Digest?                                                            Yes.


          JUDGMENT

1. By this petition under Section 9 of the Arbitration & Conciliation Act,

1996 (for shot, "the Act") the petitioner has made the following prayers:

"a. pass an ad interim measures direction of interim injunction against the Respondent restraining the Respondent from, in any manner, acting contrary to and/ or inconsistent with the terms of the collaboration agreement dated 2-3-2005 and the supplementary collaboration agreement dated 10-7-2007 and in particular restraining the respondent from constructing and/or building any road providing entry and exit only to Pocket 'D' and blocking the entry and exit point to pocket 'A' from the main Gurgaon-Sohna Road in violation of the sanctioned plans."

2. As per the facts disclosed in the petition, the petitioner company

having registered office in Delhi entered into a collaboration agreement with

respondent having registered office at Lucknow. The collaboration agreement

OMP 507/2009 Trehan Promoters & Builders Pvt. Ltd. v.Welldone Technology Parks Development Pvt. Ltd Page 1 Of 7 was executed at New Delhi for developing an IT Park for commercial space on

the land owned by petitioner at Village Tikri Tehsil, District Gurgaon, Haryana

by the respondent at its own cost and the petitioner was to get 50% of the

total sanctioned FSI and 50% was to go to respondent in terms of the

sanctioned building plan. The parties allocated their shares on paper in the

entire project. It is stated that as per sanctioned plan, a common entry and

exit to Pocket A and D of the project was to be from Gurgoan-Sohna Road.

Respondent, who was responsible for construction and development of the

site, recently started working on main entry and exit by deviating from the

sanctioned plan. While, as per the sanctioned plan, a common entry and exit

to Pocket A and D of the project was to be provided, the respondent insisted

on constructing an entry and exit road only for Pocket D falling in its share,

thereby, preventing access to Pocket A from the main Gurgaon-Sohna Road.

It is submitted that this action of respondent amounted to breach of

collaboration agreement.

3. The cause of action for the petitioner to approach this Court arose

when respondent started providing entry and exit for the different blocks of

the project under collaboration agreement at Gurgaon-Sohna Road which falls

within the jurisdiction of Court at Haryana. The relief which the petitioner has

sought from this Court is that the respondent should be restrained from

providing exit near Block D of Gurgaon-Sohna Road of the project instead of

providing exit near block A. In view of these facts, the petitioner was asked to

address the arguments on the issue of jurisdiction of this Court. It is

submitted by petitioner that since the prayer made by the petitioner is for

compliance of the terms of collaboration agreement and this compliance is to

be obtained from personal obedience, this Court will have jurisdiction in terms

OMP 507/2009 Trehan Promoters & Builders Pvt. Ltd. v.Welldone Technology Parks Development Pvt. Ltd Page 2 Of 7 of proviso to Section 16 of Civil Procedure Code. The petitioner relied on Mrs.

Bhawna Seth v DLF Universal Limited & Anr. CS (OS) 2110 of 1998 decided on

19th February 2007 and Adcon Electronics Pvt. Ltd. v Daulat & Anr. JT 2001(7)

SC 580. In Adcon Electronics Pvt. Ltd. (supra), the Supreme Court had

considered Clause 12 of Letter Patent of High Court of Bombay and Section

22 of the Specific Relief Act and observed that a suit for land is a suit in which

relief claimed relates to title or delivery of possession of land or immovable

property and a suit for specific performance of contract to execute and

register a lease with alternative claim for damages is not a suit for land within

the meaning of Clause 12 of the Letters Patent Act. In my considered view,

this judgment is not applicable to the case of petitioner herein that

approached this Court under Section 9 of the Arbitration & Conciliation Act

since this judgment has not addressed and dealt with the issue of jurisdiction

under Section 9. It is settled law that every judgment of the High Court or the

Supreme Court decides lis before it and unless and until a general law is laid

down, the judgment is not to be treated as a statute.

4. In Bhavna Seth's case (supra), this Court after considering the various

judgments passed by this Court and Adcon Electronics Pvt. Ltd. (supra) and

Harshad Chiman Lal Modi v. DLF Universal Ltd. & Anr. (2005) 7 SCC 791,

observed that a distinction has been carved out in respect of a suit where no

possession has been claimed of the land (subject matter of suit) and a suit in

which possession of the land has been claimed. The suit in Bhavna Seth's

case (supra) was also for specific performance of the contract i.e. for

enforcement of the contract for sale and for execution of sale deed. The

counsel for plaintiff in that case told the Court that plaintiff would not press

for relief of possession and plaintiff reserved its right to file separate suit for

OMP 507/2009 Trehan Promoters & Builders Pvt. Ltd. v.Welldone Technology Parks Development Pvt. Ltd Page 3 Of 7 possessions at a later stage. Since the plaintiff did not claim relief for

possession, despite the fact that the property was not situated within the

jurisdiction of this Court, this Court considered on the basis of Adcom

Electronics Pvt. Ltd. (supra) that this Court shall have territorial jurisdiction to

entertain and try the suit. The case of Bhavna Seth (supra) was also under

Specific Relief Act.

5. Section 9 of the Arbitration & Conciliation Act, 1996 gives powers to the

Court to pass an interim order to the following effects:

"(i) for the appointment of a guardian for a minor or person of unsound mind for the purposes of arbitral proceedings; or

(ii) for an interim measure of protection in respect of any of die following matters, namely:-

(a) the preservation, interim custody or sale of any goods which are the subject- matter of the arbitration agreement;

(b) securing the amount in dispute in the arbitration;

(c) the detention, preservation or inspection of any property or thing which is die subject- matter of the dispute in arbitration, or as to which any question may arise therein and authorizing for any of the aforesaid purposes any person to enter upon any land or building in the possession of any part or authorizing any samples to be taken or any observation to be made, or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full information or evidence;

(d) interim injunction or the appointment of a receiver;

(e) such other interim measure of protection as may appear to the Court to be just and convenient, and the Court shall have the same power for making orders as it has for the purpose of, and in relation to, any proceedings before it."

6. Section 9 is applicable only where a party has invoked the arbitration

clause or has intention to invoke the arbitration clause. Section 9 is not in the

nature of provisions of Specific Relief Act where a party can come to the

OMP 507/2009 Trehan Promoters & Builders Pvt. Ltd. v.Welldone Technology Parks Development Pvt. Ltd Page 4 Of 7 Court and pray for a relief of performance of the contract and ask the Court to

compel the other party to abide by the terms and conditions of the contract

and seek an injunction from the Court that the party should be restrained

from violating the terms and conditions of the contract. In fact, Section 9 of

the Act envisages existence of an arbitration clause whereunder the disputes

resolution mechanism is provided and the parties had chosen the arbitration

as a dispute resolution mechanism instead of choosing the Court to resolve

their disputes. Resort to the Court under Section 9 of the Act is for limited

purpose of preserving the property which is the subject matter of dispute so

that by the time the arbitrator decides the dispute, the property itself is either

sold away or disposed of by the opposite side, or being of perishable nature is

likely to perish or where there is need to appoint a receiver, the Court passes

an order for appointing a receiver. The extent and scope of relief under

Section 9 of the Act cannot extend so as the Court directs a party to

specifically perform the contract so that the party approaching the Court has

not to go to the arbitrator for breach of contract. Section 9 does not envisage

a situation where the order of the Court under Section 9 itself settles the

disputes between the parties. Neither by the instrumentalities of Section 9,

the Court can put the party back into pre-dispute situation and ask the party

to comply with the contract. Even under Order 39 Rules 1 & 2 CPC, which is

referred to as akin to Section 9 of the Act, an interim relief cannot be granted

which is same as the relief sought in the suit, and which amounts to disposal

of the suit itself. [P. Subbarao and Ors. v Andhra Pradesh Association FAO

(OS) 25 2007 Delhi DB]. If the Court could direct specific performance of the

contract under Section 9 of the Arbitration & Conciliation Act, and could place

the parties in the position prior to rising of dispute, no dispute would ever go

to the arbitrator and by an interim relief itself, the Court would be finally

OMP 507/2009 Trehan Promoters & Builders Pvt. Ltd. v.Welldone Technology Parks Development Pvt. Ltd Page 5 Of 7 disposing of all the disputes between the contracting parties by just directing

specific performance of the contract, irrespective of the breach on the part of

one or the other.

7. I also consider since the property is situated outside the territorial

jurisdiction of Delhi this Court would have no jurisdiction. The parties entered

into the collaboration agreement for developing the immovable property. The

disputes regarding development of the property, construction, entry, exit are

the disputes in respect of immovable property and the rights of the parties

therein. Clause 16(d) of CPC provides that for determination of any right or

interest for immovable property, the suit has to be instituted in the Court

within the local limits of whose jurisdiction the immovable property is

situated. Whether the petitioner should have a gate on the main Gurgaon-

Sohna Road or on the side road as sought to be constructed by respondent is

a dispute of rights of petitioner in respect of the property only. It is not a

dispute qua a personal right against the respondent. The proviso cannot be

explained in a manner that for every relief under Section 16 CPC personal

obedience is pleaded. For example, in case of Clause 16(a) CPC, if respondent

is in possession of the immovable property, he can be directed to handover

possession of immovable property and the immovable property can be

recovered by the respondent being compelled by personal obedience of such

a direction of the Court. Similarly, respondent can be compelled by personal

obedience to partition the immovable property by handing him over a site

plan and drawings of lines on site plan where he has to construct the walls.

Even the foreclosure of mortgage, sale or redemption can be got done

through the personal obedience of the parties. The immovable property is

incapable of performing any act in itself. It is only the owner/ lessor/ lessee

OMP 507/2009 Trehan Promoters & Builders Pvt. Ltd. v.Welldone Technology Parks Development Pvt. Ltd Page 6 Of 7 /mortgagee/ licensee who has to do the different acts in respect of the

property. If the property has to be transferred from A to B, A has to personally

execute a sale deed in favour of B. It is the person concerned with the

property who has to do certain acts in respect of the property for all purposes

concerning the property. I, therefore, consider that personal obedience

cannot be stretched to such an extent that Section 16 of CPC itself becomes

redundant. I find no act in respect of the property which cannot be got done

through personal obedience by directing the owner/ person concerned with

the property.

8. In my view, the proviso would not be applicable in order to invoke the

jurisdiction under Section 2 (i) (e) read with Section 9 of the Arbitration &

Conciliation Act, 1996 so as to claim relief qua the property situated in

Gurgaon, Haryana from the Court in Delhi.

9. In view of my foregoing discussion, I find that this Court has no

territorial jurisdiction to entertain the present petition. The petition is liable to

be dismissed and is hereby dismissed in limine. No orders as to costs.

September 04, 2009                                                       SHIV NARAYAN DHINGRA J.
rd

OMP 507/2009 Trehan Promoters & Builders Pvt. Ltd. v.Welldone Technology Parks Development Pvt. Ltd Page 7 Of 7