Point of law: Even if there is an arbitration agreement between the parties, and even if the dispute is covered by the arbitration agreement, the Court where the civil suit is pending, will refuse an application under Section 8 of the Act, to refer the parties to arbitration, if the subject-matter of the suit is capable of adjudication only by a public forum or the relief claimed can only be granted by a special Court or Tribunal

ORDER :

1. By way of this application filed under Section 11(5) and (6) of Arbitration and Conciliation Act, 1996 (for short “the Act”), the applicant seeks for appointment of a retired Judge of this Court as an Arbitrator to settle the disputes among the applicant and respondent.

2. The brief facts of the case are that the applicant is a registered firm registered under the provisions of Indian Partnership Act, 1932 and is into the business of developing the properties by undertaking construction of flats or independent houses and also civil works of its clients. The respondent herein approached the applicant in the year 2006 stating that he is the absolute owner and possessor of Plot Nos. 51, 52, 57, 58 and 59 admeasuring 1,520 Sq. Yards in Sy. No. 31/A and Plot Nos. 53, 54 and 55 admeasuring 546 Sq. Yards in Sy. No. 31/EE and Plot No. 56 admeasuring 267 Sq. Yards in Sy. No. 31/EE, total admeasuring 2,333 Sq. Yards situated at Manikonda Jagir Village and Gram Panchayat, Rajender Nagar Mandal, Ranga Reddy District having purchased the same under Registered Document Nos. 1275/2002 dated 18.2.2002, 10918/2003 dated 30.8.2003 and 14295/2003 dated 13.11.2003 and offered the applicant for development of the said property for construction of duplex houses and entered into an unregistered Agreement dated 29.4.2006 and received a sum of Rs. 5,00,000/- as non-refundable deposit. In pursuance of the same, applicant obtained necessary sanction and permission from the competent authorities with its own expenses in the name of the respondent and commenced construction immediately by investing huge capital. However, the respondent though produced the records relating to title for obtaining necessary sanctions from the competent authorities, did not deliver the same to the applicant. On repeated persuasion by the applicant, the respondent finally executed a registered Development Agreement-cum-General Power of Attorney, dated 15.3.2007 (for short ‘Development agreement dated 15.3.2007’). However, once again respondent entered into a Registered Supplementary Development Agreement-cum-General Power of Attorney, dated 26.4.2007 (for short ‘Supplementary Development Agreement dated 26.4.2007’) in respect of some adjustments. The applicant completed the structure of all the ten villas and commenced brick work and fixed the door frames in order to complete and deliver to the respondent on priority. Thereafter, the applicant entered into agreements with the prospective purchasers in respect of his share of villas and received part sale consideration and when those purchasers approached the banks in the year 2008 for financial assistance, the said loan proposals were rejected as title deeds were not submitted by the respondent. After execution of Registered Supplementary Development Agreement, dated 26.4.2007 there was change of Guard in the applicant's firm with effect from 27.2.2009 by which an Admission-cum-Retirement Deed was drawn and the then Managing Partner Sri D. Chandrasekhar Reddy retired from the firm and one Sri T. Umesh joined as a partner and Smt. D. Sashirekha became the Managing Partner and this change was registered as Document No. 85/2009, dated 28.3.2009, which was informed to the respondent and was ratified. As the respondent started interfering with the construction activity of the applicant by sending antisocial elements, applicant filed OS No. 28 of 2011 for perpetual injunction on the file of Additional Junior Civil Judge, Rajender Nagar, R.R. District. The respondent herein also filed suit OS No. 1227 of 2014 on the file of V Additional District Judge, Ranga Reddy District challenging the registered sale deeds executed by the applicant herein as null and void. In the said suit, the applicant filed application under Section 8 of the Act.

3. As the respondent was creating troubles and obstructing the construction activity and has failed to deliver the original title documents, the applicant issued a registered legal notice date