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2024 Supreme(Bom) 733

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ARIF S. DOCTOR, J.
Gulshan Townplanners LLP - Petitioner
Versus
Gulshan Co-operative Housing Society Limited & Ors. - Respondents
Commercial Arbitration Petition (L) No. 34078 of 2023
Decided On : 30-09-2024

Advocates Appeared:
For the Petitioner: Mr. Shanay Shah a/w Smit K. Nagda.
For the Respondents:Mr. Mayur Khandeparkar a/w Pankaj S. Pandey, Mr. Simil Purohit, Sr. Advocate a/w Arshil Shah i/by Parisha Shah a/w Smita Durve, Rasesh Shah, Tanmay Gujarathi, Vishal Pattabiraman and Rutwij Bapat.

IMPORTANT POINT
A petition under Section 9 of the Arbitration Act requires an existing arbitration agreement between the parties, which was not present in this case.

Headnote:

Arbitration - Redevelopment Agreement - Section 9 of the Arbitration & Conciliation Act, 1996 - The court interpreted Section 9 as requiring an arbitration agreement between parties, which was absent in this case, leading to the dismissal of the petition.

Fact of the Case:

The petition involved a redevelopment agreement between a developer and a cooperative housing society, with disputes arising from the non-cooperation of a non-member occupant. The court examined the legal standing of the parties and the validity of the agreements.

Finding of the Court:

The court found that there was no arbitration agreement between the developer and the non-member occupant, and thus, the petition under Section 9 of the Arbitration Act was not maintainable.

Issues: Whether the petition under Section 9 of the Arbitration Act was maintainable against a non-member occupant who had not signed the redevelopment agreement.

Ratio Decidendi: The absence of an arbitration agreement between the petitioner and the non-member occupant rendered the petition under Section 9 of the Arbitration Act unmaintainable.

Result: The petition is dismissed with costs awarded to the respondent.

JUDGMENT :

Arif S. Doctor, J.

1. While at first blush the captioned Petition would appear to be the usual Petition filed under Section 9 of the Arbitration & Conciliation Act, 1996 (“Arbitration Act”) in matters of redevelopment agreements entered into between a Developer, (the Petitioner in the present case) and a Cooperative Housing Society, (Respondent No. 1 “the Society” in the present case), the facts of the present case would make plain that it is infact anything but so. Infact, in my view, as the facts of the present case would make clear, the present Petition is nothing but a sheer attempt to misuse of the provisions of Section 9 of the Arbitration Act.

2. The ‘disputes’ that are stated to have arisen are under a Redevelopment Agreement (“RDA”) and a Supplementary Agreement (“SA”), both dated 20th July 2022 entered into between the Petitioner i.e., the Developer, on the one hand and the Society which comprises of eleven members on the other hand. The RDA has also been individually signed/executed by each of the eleven members of the Society. Admittedly, Respondent No. 2 is neither a member of the Society nor has Respondent No. 2 signed the RDA. Infact, the Petition itself describes Respondent No. 2 as “Occupant on Respondent No. 1’s property”.

3. Before adverting to the rival contentions, it is essential to set out the following facts, viz.

    i. The Petition concerns a plot of land measuring about 461.52 sq. meters, bearing CTS No. 1163, Final Plot No. 282, T.P.S. II (1st variation final) of Village: Vile Parle (East), Dist. Mumbai Suburban (“the said land”), and a structure/building comprising of ‘A’ and ‘B’ Wings (“the said structure/building”) standing on the said land.

ii. On 13th January 1986, M/s. Gulshan Construction, through a Deed of Assignment, was granted development rights in respect of the said land by its owner, stated to be one Pyaremal Sagormal. Subsequently, M/s. Gulshan Construction built the said structure/building. The A-Wing initially comprised of a ground floor and three upper floors, and B-Wing comprising a ground floor and two upper floors. Later, a fourth floor was added to the A-Wing.

iii. M/s. Gulshan Construction then sold all the flats in the A-Wing to individual purchasers, i.e., the eleven members of the Society. The B-Wing, which has one flat per floor, was initially kept unsold and reserved by a partner of M/s. Gulshan Construction for his personal use. However, in 1993, the partner of M/s. Gulshan Construction sold all three flats in B-Wing to Respondent No. 2. In the year 2006 the individual flat purchasers of A-Wing registered and formed the Society on 22nd August 2006. It is not in dispute that (a) Respondent No. 2 is not a member of the Society, (b) the B-Wing has been independently assessed for property tax since 2001, which had at all times been paid by Respondent No. 2, (c) B-Wing has independent water and electricity connections for which separate bills are raised on and are paid by Respondent No. 2 (d) there is a compound wall between A-wing and B-wing and separate entrances to both the wings and (e) the open space around each wing was separately demarcated.

iv. In 2018, the Society, during a Special General Body Meeting (SGM) held on 8th September 2018, resolved to undergo redevelopment. However, the Petition asserts that due to the non-cooperation of Respondent No. 2, the redevelopment did not proceed. The Society thereafter in the year 2019 applied for a unilateral deemed conveyance in respect of the said land and structure/building. Respondent No. 2 contested the application for deemed conveyance. The Competent Authority, however, by an order dated 7th September 2020, allowed the application for deemed conveyance. This order was challenged by Respondent No. 2 by filing Writ Petition (St) No. 1253 of 2021 which Petition is presently pending.

v. On 3rd November 2020, the Petitioner submitted an offer to the Society for the redevelopment of the said land and said structure/building. Res

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