Jharkhand High Court
Arun Kumar Rajgariha vs Prarthana Creations Private Limited ... on 5 August, 2025
Author: Gautam Kumar Choudhary
Bench: Gautam Kumar Choudhary
2025:JHHC:22112
IN THE HIGH COURT OF JHARKHAND AT RANCHI
C.M.P. No. 366 of 2025
Arun Kumar Rajgariha, S/o Late Sanwar Mull Rajgariah, R/o Albert Ekka
Chowk, PO- GPO, PS- Kotwali, District- Ranchi, PIN-834001, State-
Jharkhand. ..... .... Petitioner
Versus
1. Prarthana Creations Private Limited having its registered office at 601, Modi
Heights II, Opposite All India Radio, Ratu Road, P.O.: Sukhdeo Nagar, P.S.:
Sukhdeo Nagar, District: Ranchi, Pin-code: 834001, State: Jharkhand.
2. Shri Vikash Modi son of Ravindra Modi, director of Prarthana Creations
Private Limited, resident of Nand Kanan, Lake Avenue, Kanke Road, P.O.:
Kanke, P.S.: Gonda, District: Ranchi, Pin-code: 834008, State: Jharkhand.
3. Ghanshyam Rajgariah, son of Late Durga Prasad Rajgariah, resident of Flat
No. IE, Block C, Spring Valley Phase II, Lalpur, P.O. & P.S.: Lalpur, District:
Ranchi, Pin-code: 834001, State: Jharkhand.
4. Anil Kumar Rajgariah, son of Late Shravan Kumar Rajgariah, resident of Flat
no.3D, Block D, Spring Valley Phase II, Lalpur, P.O. & P.S.: Lalpur, District:
Ranchi, Pin-code: 834001, State: Jharkhand.
5. Murari Lal Rajgariah, son of Late Sanwar Mull Rajgariah, resident of Flat No.
2D, Block D, Spring Valley Phase II, Lalpur, P.O. & P.S.: Lalpur, District: Ranchi,
Pin-code: 834001, State: Jharkhand.
6. Manoj Kumar Rajgariah, son of Late Sanwar Mull Rajgariah, resident of
Albert Ekka Chowk, Main Road, P.O.: GPO, P.S.: Kotwali, District: Ranchi, Pin-
code: 834001, State: Jharkhand.
7. Dinesh Kumar Rajgaria, son of Late Jugal Kishore Rajgaria, resident of
Albert Ekka Chowk, Main Road, P.O.: GPO, P.S.: Kotwali, District: Ranchi, Pin-
code: 834001, State: Jharkhand.
8. Sanjay Kumar Rajgaria, son of Late Balgovind Prasad Rajgaria, resident of
Albert Ekka Chowk, Main Road,
P.O.: GPO, P.S.: Kotwali, District: Ranchi, Pin-code: 834001, State: Jharkhand.
9. Vikash Kumar Rajgaria, son of Late Raj Kishore Rajgaria, resident of Albert
Ekka Chowk, Main Road, P.O.: GPO, P.S.: Kotwali, District: Ranchi, Pin-code:
834001, State: Jharkhand.
10. Krishna Kumar Rajgaria, son of Late Vinod Kumar Rajgaria, resident of
Albert Ekka Chowk, Main Road, P.O.: GPO, P.S.: Kotwali, District: Ranchi, Pin-
code: 834001, State: Jharkhand.
11. Vijay Kumar Rajgaria, son of Late Vinod Kumar Rajgaria, resident of Albert
Ekka Chowk, Main Road, P.O.: GPO, P.S.: Kotwali, District: Ranchi, Pin-code:
834001, State: Jharkhand.
12. Urmila Kedia, daughter of Late Ashok Kumar Rajgarhia, resident of Flat
No. 101, Rishab Apartment, O.B.C. Lane, Near Raymond Showroom, Opp.
Vendor Market, P.O.: GPO, P.S.: Sadar, Kutchery Road, District: Ranchi, Pin-
code: 834001, State: Jharkhand.
1
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13. Roshni Jalan, daughter of Late Ashok Kumar Rajgarhia, C/o Bijay Jalan,
Advocate, resident of Aroma palace, 2nd Floor, Firayalal By lane, Albert Ekka
Chowk, Main Road, P.O.: GPO, P.S.: Kotwali, District: Ranchi, Pin-code:
834001, State: Jharkhand.
14. Binay Rajgarhia, son of Late Ashok Kumar Rajgarhia, resident of Flat No.
101, Rishab Apartment, O.B.C. Lane, Near Raymond Showroom, Opp. vendor
Market, P.O.: GPO, P.S.: Sadar, Kutchery Road, District: Ranchi, Pin-code:
834001, State: Jharkhand.
15. Harshita Rajgaria, daughter of Late Mahesh Rajgaria, resident of Albert
Ekka Chowk, Main Road, P.O.: GPO, P.S.: Kotwali, District: Ranchi, Pin-code:
834001, State: Jharkhand.
16. Himanshi Rajgaria, daughter of Late Mahesh Rajgaria, resident of Albert
Ekka Chowk, Main Road, P.O.: GPO, P.S.: Kotwali, District: Ranchi, Pin-code:
834001, State: Jharkhand.
17. Devansh Rajgaria, son of Late Mahesh Rajgaria, resident of Albert Ekka
Chowk, Main Road, P.O.: GPO, P.S.: Kotwali, District: Ranchi, Pin-code:
834001, State: Jharkhand.
18. Sushila Rajgarhia, wife of Late Ashok Kumar Rajgariah resident of Flat No.
101, Rishab Apartment, O.B.C. Lane, Near Raymond Showroom, Opp. vendor
Market, P.O.: GPO, P.S.: Sadar, Kutchery Road, District: Ranchi, Pin-code:
834001, State: Jharkhand.
19. Sangita Rajgaria, wife of Late Mahesh Rajgaria, resident of Albert Ekka
Chowk, Main Road, P.O.: GPO, P.S.: Kotwali, District: Ranchi, Pin-code:
834001, State- Jharkhand.
20. Ranchi Municipal Corporation, having its office at Kutchery Road, PO- GPO
PS- Kotwali, District- Ranchi, Jharkhand, 834001
..... .... Opposite parties
CORAM: HON'BLE MR. JUSTICE GAUTAM KUMAR CHOUDHARY
For the Petitioner : Mr. Jitendra Kumar Pasari, Advocate
Mr. Avinash Kumar Pasari, Advocate
For the O.P. 1 & 2 : Mr. Vibhor Mayank, Advocate
For the RMC : Mr. Shashank Shekhar, Advocate
: Mr. Kabir, Advocate
------
06 / Dated : 05.08.2025.
Heard, learned counsel for the parties.
1. The order passed in Original Suit No. 816/2024 to refer the matter for
arbitration under Section 8 of the Arbitration and Conciliation Act, 1996
is under-challenge by the plaintiff/ petitioner in the instant Civil
Miscellaneous Petition.
2. Plaintiff is the land owner, whereas defendants-Opp. Parties are the
builders and the other co-owner(s) of the land. Plaintiff entered into a
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development agreement with respondent no. 1 and 2 on 19.11.2022
for development of the land by respondent nos. 1 and 2 as per the
terms of agreement of the land fully detailed in the schedule of the
agreement.
3. The dispute arose with respect to the claim of the plaintiff/ petitioner
for one shop to be constructed by the developer for the plaintiff on the
front side as per the understanding between the parties. It is
contended that Clause 4 in the agreement is to the extent that before
plan/map was to be presented for sanction to the Ranchi Municipal
Corporation (O.P. No.20). The developer will present the same with the
land owner for his written approval.
4. The cause of action arose when the defendants without getting the
approval presented the map for sanctioning before Ranchi Municipal
Corporation [Opp. Party No.20].
5. Plaintiff filed the suit, inter alia, for the relief of mandatory injunction on
the ongoing construction of the building on account of breach of the
terms of the agreement.
6. The learned Trial Court vide impugned order referred the dispute for
arbitration which is under challenge before this Court.
7. The relevant arbitral clause is extracted below:
"The any dispute or difference between the parties arising out of the
meaning constitute or impart of this agreement or the right and
liabilities hereunder shall be referred to the Arbitration of two
independent Arbitrators one to be appointed by the LAND OWNERS
and other by the BUILDER who shall appoint an umpire at the
commencement of the reference, and award of the arbitrator/umpire
shall be final and conclusive specially as between the parties and this
clause shall be deemed to be the submissions within the meaning of
the Arbitration and Conciliation Act, 1996 and its statutory modification
thereof from time to time. In the event of breach of this Development
Agreement and or Abuse/misuse of General Power of Attorney, either
by the BUILDERS or the LAND OWNERS the defaulting party will be
decided by the Arbitrator or Competent Court under the terms and
conditions of this agreement within Ranchi the Capital of Jharkhand
State."
8. It is argued by the learned counsel on behalf of the petitioner that there
are two parts of the above mentioned arbitral clause. The first is with
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regard to the construction of the term of agreement, which is to be
referred the matter for arbitration, and then there is second part which
is with regard to breach of terms of the agreement. Here, there was no
dispute with regard to the terms of agreement, so there was no
requirement to refer to arbitration. As it was involving breach of the
development agreement, therefore it was not mandatorily to be
referred for arbitration, which will be evident from use of the expression
"and or Abuse/misuse of General power of Attorney either by the
builder or the land owner, the dispute was decided by the Arbitrator" in
the said agreement.
9. It is submitted by learned counsel that in view of the use of word 'OR'
in this clause, the power of the Trial Court to adjudicate the dispute
was not foreclosed. It is argued that all the parties have not been made
party to the arbitral agreement, and therefore arbitrator cannot decide
the dispute affecting the right and interest of the parties who were not
parties to the suit. Law is settled that non-signatories cannot be bound
by the arbitral award, when they are not party to the arbitral agreement.
Partial bifurcation of suit, so as to refer a part of suit to arbitration is
impermissible. Reliance is placed on [(2023) 7 SCC 193], Gujarat
Composite Limited vs. A Infrastructure Limited and Ors.
10. Learned counsel for the petitioner in support of his submission has
further relied upon the judgment rendered in the case of BGM and M-
RPL- JMCT (JV) vs. Eastern Coalfields Limited, reported in 2025
SCC OnLine SC 1471.
11. Learned counsel appearing on behalf of the opposite party no. 1
and 2 submits that the dispute was both about the construction of the
terms of the agreement as well as the rights and liabilities arising
therefrom.
12. The second part of the clause specifically refers that the matter had
to be referred to the Arbitrator and, therefore, there was no infirmity in
the impugned order. It is also submitted that the reliefs for which suit
has been filed cannot be adjudicated by the Arbitrator. Learned
counsel for the Opp. Party(s) in support of his submission has relied
upon the following authorities:-
(i) (2007) 3 SCC 686 [Agri Gold EXIMS Ltd. vs. Sri Lakshmi Knits
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& Wovens and Ors.].
(ii) (2024) 6 SCC 630 [Asian Avenues Private Limited vs. Syed
Shoukat Hussain]
(iii) (2025) 2 SCC 147 at Para-81 [Ajay Madhusudan Patel vs.
Jyotrindra S. Patel].
13. Having considered the submissions advanced on behalf of both the
sides and perusing the materials on record, the arbitral clause in the
said agreement is also not in dispute. Reference to arbitration is
contested by the Plaintiff and not by the other defendants, who were
not party to the development agreement. Dispute is essentially
between the Plaintiff who is the landowner and Defendant Nos 1 &2
who are the developers, about the claim of a constructed shop on the
front side.
14. Whether there was any express or implied term in the development
agreement for constructing a shop for the Plaintiff, in view of the
express term to seek permission of the plaintiff to refer the building
plan for sanction by the Municipal Corporation, lies in the heart of the
dispute.
15. Therefore, the plea that dispute did not involve the construction of
the terms of agreement is devoid of merit. Had there been an express
term for construction of the shop, then it could have been legitimately
contended that it was all about breach of the terms of agreement.
Counsel on behalf of OP No.1 & 2 is right that dispute was about
construction of the terms of agreement, and claim of breach if any of
the said term, Arbitral clause adequately covers the area of dispute.
16. As discussed above, since the dispute covers mainly the owner of
land/ Plaintiff and the developer, therefore the other parties having not
joined the development agreement, it does not affect the merit of the
case for referring the dispute to arbitration. Law is settled that where
there is an arbitration agreement, reference to arbitrator is pre-emptory
in nature. [See Agri Gold Exims Ltd. supra]. Further even a non-
signatory can be bound to the arbitral award in given facts and
situation as held in Ajay Madhusudan Patel VS Jyotrindra S. Patel,
(2025) 2 SCC 147 wherein it has been held as under:-
"It is evident that the intention of the parties to be bound by an
arbitration agreement can be gauged from the circumstances that
surround the participation of the non-signatory party in the
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negotiation, performance, and termination of the underlying
contract containing such an agreement. Further, when the conduct
of the non-signatory is in harmony with the conduct of the others,
it might lead the other party or parties to legitimately believe that
the non-signatory was a veritable party to the contract containing
the arbitration agreement. However, in order to infer consent of the
non-signatory party, their involvement in the negotiation or
performance of the contract must be positive, direct and substantial
and not be merely incidental. Thus, the conduct of the non-
signatory party along with the other attending circumstances may
lead the referral court to draw a legitimate inference that it is a
veritable party to the arbitration agreement".
17. Under the circumstance, as clause to refer the dispute to arbitration
constituted part of the development agreement, therefore the trial
Court was right in referring the matter for arbitration. For the reasons
discussed above this Court does not find any infirmity in the impugned
order.
Civil Miscellaneous Petition stands dismissed. Pending
I.A., if any, also stands disposed of.
(Gautam Kumar Choudhary, J.)
Sandeep/ Pawan/ -
