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1985 Supreme(Del) 420

High Court Of Delhi
JUGAL KISHORE VATS - Appellant
Versus
SARITA SHARMA - Respondent
First Appeal Order 152 of 1984
Decided On : 11/08/1985

Advocates Appeared:
M.L.Lonial, Y.P.Ahuja

Headnote:Arbitration Act - Section 34 — Stay of Suit — The agreement provides arbitration for the disputes as to interpretation and meaning of words touching the rights and obligations of the parties — The suit of the plaintiff for possession is based on alleged violation of the agreement — To determine the dispute between the parties various clauses of the agreement are to be interpreted.

       Held:

       There is no infirmity in the order of Trial Court staying the suit.

Sultan Singh, J.

( 1 ) THIS first appeal is directed against the judgment and order dated 6th June, 1984 of the Additional District Judge, Delhi staying the plaintiff s suit for possession against the defendants-respondents under Section 34 of the Arbitration Act.

( 2 ) BRIEFLY these- are the facts. Jugal Kishore Vats, appellant filed a suit for possession against the defendants. He has alleged that he is a member of the Sarai Julaina Co-op House Building Society Ltd. , that the society had allotted him Plot No. 49 in Sukhdev Vihar, New Delhi by a registered deed dated 17th October, 1973 between the President of India, the said society and the plaintiff and thus the lease-hold rights were transferred to him, that be got the building plans sanctioned, that on 20th November, 1978 he entered into an agreement with defendant No. 1 for the construction of a residential house on the said plot, that he executed a power of attorney in favour of defendant No. 2 and a Will in favour of defendant No. 1, that he received Rs. 49,000. 00 from defendant No. 1. In terms of the said agreement, defendant No. 1 had agreed for the construction of a building for a sum of Rs. one lac within a period of two years. Defendant No. 1 wax to receive 25% profit from the plaintiff after the completion of the building. Thus defendant No. 1 was entitled to Rs. 1,25,000. 00 besides refund of Rs. 49,000. 00 paid by defendant No. 1 to the plaintiff as security for due performance of the agreement, after obtaining completion certificate and giving one month s notice in writing to the plaintiff demanding the amount of Rs. 1,25,000. 00and Rs. 49,000. 00. It was also agreed that possession of the building and the plot would remain with defendant No. 1 until she has been paid in full in terms of the agreement. Further it was provided that if the plaintiff fails to pay to defendant No. 1 within one month from the receipt of notice, defendant No. 1 would be entitled to claim transfer of lease-hold rights in consideration of Rs. 49,000. 00. There are also other terms agreed to by the parties.

( 3 ). The plaintiff has alleged that in terms of the agreement defendant No. 1 was to complete the house within two years, obtain completion certificate and to give notice in writing demanding a sum of Rs. 1,25,000. 00 besides Rs. 49,000. 00that defendant No. 1 has not completed the building as yet, and she has committed the breach of the various terms of the agreement, that the construction made by her-is defective and of a very poor quality. A notice dated 28th January, 1982 was sent by the plaintiff to defendant No. 1 which was replied. The plaintiff therefore claims that. defendants having committed breach of the agreement of the building construction are not entitled to retain possession, and are liable to deliver possession to him. The plaintiff has thus prayed for a decree for possession besides return of all original documents delivered to defendant No. 1.

( 4 ). The defendant filed an application under Section 34 of the Arbitration Act alleging that the disputes had arisen between the parties and the disputes which are subject matter of the suit are within the frame work of the arbitration clause entered into writing by them. The plaintiffappellant in reply submits that the subject matter of the suit does not fall within the scope of the arbitration clause. The trial court, as already stated stayed the suit.

( 5 ). Clause 21 of the agreement of Building Construction dated 20th November, 1978 reads as under :

"that in case of any dispute arising out of this agreement whether as to the interpretation of the various clauses or meaning of any word touching the rights and obligations of the parties whatsoever, the matter shall be referred to an Arbitrator to be appointed by the parties hereto, whose decision shall be final, and binding on the parties subject to the proviso that the decision of the arbitrator is within the framework of and in consonance with the spirit and lett



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