Delay in Section 11(6) applications condonable under Section 5 Limitation Act only exceptionally with strong cause, such as prior litigations preserving arbitration subject matter like redevelopment project against third-party acquisition.

JUDGMENT :

SANDEEP V.MARNE, J.

1) This is an Application filed by the Applicant under Section 11 of the Arbitration and Conciliation Act, 1996 (the Arbitration Act) for appointment of an Arbitrator for adjudication of disputes between the parties arising out of Deed of Alteration of Partnership dated 10 April 2013. Since there is delay of 258 days in filing the Application, the Applicant has filed Interim Application (L) No.11418 of 2026 for condonation thereof.

2) The Applicant is a registered Limited Liability Partnership Firm. The subject matter of dispute between the parties is the property known as -Panwala chawl Nos. 2 and 3 situated at City Survey No.1/112 of Parel Sewri Division, Building No.75-75A and 75-B, Dr. S.S. Rao Road, Lalbaug, Mumbai (suit property). The property originally belonged to a private trust, which are acquired by M/s. R.B. Builders and Developers (the Firm) pursuant to order passed by this Court. At that time, there were 7 partners namely Respondent Nos.1 to 7 in the Firm. The acquisition was for the purpose of redevelopment of the suit property. The Maharashtra Housing and Area Development Authority (MHADA) issued NOC for redevelopment of the property in the year 2008, which was modified in the year 2010. The Municipal Corporation granted Intimation of Disapproval (IOD) dated 4 August 2010. A Memorandum of Understanding came to be executed between the Respondents and sister concern of the Applicant (Poonam Infra) for transfer of development rights for consideration of Rs.20.70 crores. It is the case of the Applicant that its nominee made a payment of Rs.4 crores to the Firm. Deed of Admission of Partner dated 30 April 2011 was executed, under which Applicant’s nominee -Poonam Infra, a partnership firm was added as 8^th partner in the Firm having 15% pro ratio. Poonam Infra was to make contribution of its share for carrying on construction and redevelopment of the project. The Firm obtained commencement certificate dated 9 December 2011. Construction commenced and was completed upto the plinth level. A stop work notice was issued in the year 2012, which was revoked in the year 2013. According to the Applicant, it later realised that its sister concern-Poonam Infra cannot be a partner of another Firm and accordingly, Deed of Alteration of Partnership Firm dated 10 April 2013 was executed, under which the Applicant was made 8^th Partner in the Firm. According to the Applicant, MHADA issued show cause notice to the Firm for revocation of NOC. On 29 December 2016 MHADA directed the Firm to effect redevelopment work and pay rent to the tenants, which the Firm was unable to pay. Thereafter litigation took place between the Society, Firm and MHADA relating to the redevelopment project.

3) In the light of above background, the Applicant decided to withdraw itself from the project and sought refund of amount of Rs.29,63,67,674.97. The notice issued by the Applicant was responded by the Respondents denying the contents therein. The Applicant apparently filed police complaints. By notice dated 20 June 2020, the Applicant invoked arbitration clause. Since no response was received, the Applicant filed Arbitration Petition No.241 of 2023 under Section 9 of the Arbitration Act seeking interim measures. On 20 July 2020, this Court granted ad-inte