2015 Supreme(SC) 967

SUPREME COURT OF INDIA
Dipak Misra, Prafulla C. Pant, JJ.
Sumer Builders Pvt. Ltd. – Appellant
Versus
Narendra Gorani – Respondent
CIVIL APPEAL NO. 4267 OF 2015 [Arising out of SLP(C) No. 11215 OF 2015]
Decided On : 15-10-2015

IMPORTANT POINT
In a ‘suit for land’ clause 12 of Letters Patent applies.

Headnote:(a) Letters Patent – Clause 12 r/w Section 120, 16, 17 and 20 of the Code of Civil Procedure, 1908 – Sections 16,17, 20 and 120 are not applicable to High Court – Hence only clause 12 of Letters Patent apply in the present case. (Para 13)

       (b) Letters Patent – Clause 12 – Suit for land – Where the relief relates to adjudication of title to land or immovable property or delivery of possession of the land or immovable property, it will be a “suit for land”. (Para 14)

       (2001) 7 SCC 698; (2015) 8 SCC 219 – Relied upon

       AIR 1950 FC 83; AIR 1952 Bom. 365; (2001) 7 SCC 698; AIR 1929 Mad. 721; AIR 1960 Cal. 626 – Referred

       (c) Letters Patent – Clause 12 r/w Section 9, Arbitration and Conciliation Act, 1996 – MoU – Development agreement creating certain interests in the land in favour of the appellant – Core dispute pertaining to possession of the land – The petition u/s 9 is “suit for land” in terms of clause 12 of Letters Patent – It cannot be treated as money suit – Suit being suit for land and land being situated in Indore, Bombay High Court was right that it did not have jurisdiction under clause 12. (Para 33)

       Facts of the case:

       Parties to the lis entered into an agreement on 28.2.2008 for development of the land of the respondent. As per the said agreement, the appellant was required to develop a residential project and/or commercial complex and/or multiplex and/or hotels and/or malls etc. as permissible in law. The respondent had handed over the vacant possession of the land to enable the appellant to start the development work. Clause 13 of the development agreement contains an arbitration clause. A Memorandum of Understanding (MoU) was entered into between the parties, which stipulates that the developer was required to construct a township project consisting of one commercial building, 11 residential wings in four buildings and one club house under licence from the Indore Municipal Corporation. It was further agreed that if the MoU was terminated, the developer would not have any right, title or interest in the township project and would be required to remove his employees and machineries from the land.

       As disputes arose with regard to payment, the respondent terminated the MoU, forfeited the security deposit and invoked the arbitration clause by issuing a notice through his Advocate on 6.6.2013. The appellant herein replied to the termination notice by stating that it had carried out substantial construction on the property by constructing three buildings and by taking many other steps. It was also stated by the appellant that the environmental clearance certificate for the project was not obtained by the respondent and, therefore, further work was stopped. The appellant required the respondent to perform his part of the contract in obtaining the requisite environmental clearance, execute irrevocable power of attorney, refund the part of the amount payable and pay interest on the security deposit.

       When arbitration was demanded by the respondent, the appellant on 16.7.2013 replied that the arbitration tribunal had to be in Mumbai. It was also put forth that it was in physical possession of the property and its construction material, machinery, office equipments and other equipments were at the site.

       The appellant moved the High Court of Bombay for grant of leave under Clause 12 of the Letters Patent by filing an application under Section 9 of the 1996 Act asserting that the courts at Bombay have the territorial jurisdiction, and accordingly leave was granted.

       The respondent after entering appearance filed an application praying for revocation of leave.

       The Single Judge revoked the leave that was earlier granted.

       The Division Bench declined to interfere with the order passed by the learned Single Judge.

       Finding of the Court:

       High Court rightly held that Clause 12 of Letters Patent applies to present case and hence Bombay High Court had no jurisdiction.

       Result: Appeal dismissed.