A court of law is the best forum to adjudicate upon disputes arising out of a transaction for the sale of a plot and the building constructed thereon, where the construction agreement is not independent but forms part of the transaction.

( 1 ) BY this order, I propose to dispose of (i) a petition filed u/s. 20 of the Arbitration Act (the act ), it being Suit No. 453-A of 1986, by Gurbaksh Singh Uppal and his wife Smt. Raj Kaur Uppal ( uppals ), the two petitioners against the sole respondent, Smt. Usha Malhotra, and (ii) an application, being I. A. 5831 of 1989, u/s. 34 of the Act, filed again by Uppals, the defendants in a suit (Suit No. 2354 of 1988) for specific performance of an agreement to sell filed by Usha Malhotra.

( 2 ) THE disputes between the parties concern property No. A-14/4, Vasant Vihar. The plot which measures 413 square Yards was held on perpetual leasehold basis by Uppals from a Society which had developed the colony. In fact, the society was the lessee, with the President of India as the lessor, and the Uppals as the sub-lessees. In the petitions, Uppals say that since under the sub-lease they were required to erect a building they, with that view, entered into an agreement of construction dated 1. 8. 1978 with Usha Malhotra. Under this agreement, a sum of Rs. 42,000. 00 was deposited by Usha Malhotra with Uppals. Certain terms of the construction agreement have then been set out in the petition. This construction agreement contained an arbitration clause, which is : that in the event of any dispute arising out of this agreement whether as to interpretation of various clauses or meaning or any works or touching the rights and obligations of the parties whatsoever the matter shall be referred to an arbitrator whose decision shall be final and binding on the parties subject to the provision that the decision of the arbitrator is within frame work of and in consonance with the spirit and letter of the terms, provisions and conditions of this agreement .

( 3 ) UPPALS say that since the disputes have arisen between the parties, these have to be referred to arbitration in terms of the aforesaid arbitration agreement. These disputes, which the Uppals claim to have arisen, are : (a) Whether respondent has obtained a completion certificate from the Delhi Development Authority certifying that the building has been completed in accordance with the terms and conditions of the lease and sent intimation thereof to the petitioners ; (b) Whether the respondent has worked out and determined the cost of construction in accordance with para 3 of the agreement and intimated the same to the petitioners ; (c) Whether the respondent is liable to restore the possession of the land and the building constructed thereon, to the petitioners, on receipt of the amount of Rs. 2,50,000 plus 25% profit on the said amount and on refund of the security money of Rs. 42,000. 00?

( 4 ) AFTER 1. 8. 1978, Uppals for the first time wrote a letter on 2. 4. 1983 requiring Usha Malhotra to intimate to them the date when the building was completed on the plot in question, and when completion certificate thereof was obtained, so as to enable Uppals to take possession of the building. Usha replied by her letter dated 9. 5. 1983 expressing surprise at the letter of Uppals. She said, the letter had been written by Uppals to blackmail her, and in fact, she was the owner of the property. Uppals, then, again wrote a letter dated 26/27th June 1983 requiring Usha to furnish to them the statement of actual expenses incurred by her on the construction of the building to enable Uppals to pay the same together with 25% of that amount, and, also, to refund the security deposit of Rs. 42,000 to Usha. She was asked to deliver peaceful and vacant possession of the building to Uppals. Since there was no response from Usha, Uppals filed this petition u/s. 20 of Arbitration Act.

( 5 ) THEN, Usha filed a suit for specific performance. She says that Uppals always intended to sell their plot, and for that purpose earlier entered into an agreement for sale with Mr. K. L. Khanna, of Rohtak Road for a consideration of Rs. 41,000. 00. She said, at that time various documents including an agreemen