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2014 Supreme(Del) 1577

IN THE HIGH COURT OF DELHI AT NEW DELHI
NAJMI WAZIRI, J.
AEZ INFRATECH PVT LTD - Petitioner
Versus
SNG DEVELOPERS LTD - Respondent
CM(M) 137, 138, 75, 76, 79, 81, 82, 83, 89, 90/2014
Decided On : 30.05.2014

Advocates Appeared:
Mr. Sacchin Puri with Ms. Aastha Lumba, Ms. Namitha Mathews, Advs.
Mr. Sanjay Sehgal, Adv.

Headnote:

Arbitration and Conciliation Act, 1996 - Section 8 - Arbitration - Arbitration clause - Filling of suit - Maintainability of - A batch of petitions challenge an order - Trial Court rejected the petitioner's application seeking reference of the suits to Arbitration - Respondent had agreed to book the residential apartment project being constructed by the petitioner - By allotment letter, suit property was allotted and a flat buyer's agreement was executed - Petitioner had agreed to deliver the possession of the apartments within 24 months - Subsequently, the allotment was cancelled and the suit was preferred - Interpretation of arbitration clause - Failure to respond to calls for conciliation indicates a failure of attempts to settle - Logical step is to invoke arbitration, not to file a suit in the Court - Respondent contended that arbitration clause is vague and is uncertain is also rejected - Parties has complete autonomy under the Act in respect of appointment of arbitrators, and also provides for a remedy in a situation where the mechanism agreed to by the parties fails - Impugned order is set aside and the case is hereby referred to arbitration.

JUDGMENT

NAJMI WAZIRI

1. Learned counsel for the petitioner had submitted that he had not received a copy of the reply. The reply was neither filed within time nor is there any application seeking condonation of delay of almost four weeks. Accordingly, it was not taken into consideration. Counsels for the parties stated that the matter may be heard on merits on the basis of the records available. Accordingly, the parties have been heard and the matter was reserved for consideration.

2. This batch of petitions challenge an order dated 27.09.2013 passed by the Trial Court which rejected the petitioner’s application under Section 8 of the Arbitration and Conciliation Act, 1996 (“Act”) seeking reference of the suits to Arbitration.

3. The respondent had filed the batch of suits seeking injunction and declaration thereby declaring the letter dated 30.06.2012 as null and void and inoperative against the respondent, as well as for permanent and mandatory injunction restraining the petitioners from selling, parting with, subletting, assigning or otherwise parting with possession of the suit property in the project of the petitioner namely “Aloha” at Rishikesh; etc.

4. The respondent had agreed to book the suit premises in the aforesaid residential apartment project being constructed by the petitioner. By allotment letter dated 17.06.2005 the suit property was allotted to the respondent and a flat buyer’s agreement dated 07.07.2006 was executed according to which the petitioner had agreed to deliver the possession of the apartments within 24 months thereafter. Subsequently, the allotment was cancelled and the suit was preferred seeking the reliefs aforesaid among others.

5. Admittedly, the petitioner initially sought time to file Written Statement but, thereafter filed an application under Section 8 of the Act seeking reference of the matter to arbitration. They relied on Clause 44 of the agreement which reads as under: “All or any disputes arising out of, or touching upon, or in relations to the terms of this agreement, including the interpretation and validity of the terms thereof, and the respective rights and obligations of the parties shall be settled amicably by mutual discussion, failing which, the same shall be settled through arbitration.”

6. The Trial Court dismissed the application on the ground that the application was not filed with the original Arbitration Agreement or its duly certified copy which is a mandatory requirement of Section 8(2) of the Act and in the absence of which the application would fail. The Court relied upon the ratio of Atul Singh v Sunil Kumar Singh, (2008 (2) SCC 602 (2000) 4 SCC 539) which held that non-production of original arbitration agreement or its duly certified copy along with an application under Section 8 of the Act is a clear non-compliance of the requirement of the said Section which is mandatory in nature.


7. Learned counsel for the petitioner submits that the suit itself relies upon the flat buyer’s agreement which contains the aforesaid Clause 44. The application under section 8 of the Act was moved before filing of the Written Statement and in the circumstances there was no requirement for a duly certified copy being filed since there was no dispute apropos the existence of the arbitration clause regarding the suit property. He relies on the judgment of the Supreme Court in P. Anand Gajapathi Raju & Others v P.V.G. Raju (dead) & Others, (2008 (2) SCC 602 which held that what is required to be seen by the Court is that the arbitration agreement covered all the disputes between the parties in the proceeding before it. The language of Section 8 is peremptory. It is, therefore, obligatory for the Court to refer the parties to arbitration in terms of the arbitration agreement; once an arbitration agreement exists, all rights and obligations of the parties would be governed by the Arbitration Act including the right to challenge the award. “An application before a Court under Section 8 me


























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