O R A L J U D G M E N T

1. The petitioner is seeking appointment of an arbitrator under Section

11 of the Arbitration and Conciliation Act.

2. On 13th August, 2018, the petitioner agreed to purchase 50% undivided share in property bearing No.C-41, Rajouri Garden, New Delhi- 110027 from the respondent for Rs.8,90,00,000/-. The petitioner paid Rs.1,50,00,000/- to the respondent (Rs.10,00,000/- in cash on 12th August, 2018, Rs.1 crore through RTGS on 13th August, 2018, and Rs.40,00,000/- in cash on 24th August, 2018). The balance sale consideration of Rs.7,40,00,000/- was payable on or before 15th January, 2019 against the execution of a sale deed. The arbitration agreement between the parties is contained in clause no.14 of the agreement dated 13th August, 2018.

3. On 19th September, 2018, the respondent’s wife issued a legal notice to the petitioner notifying him that the entire property bearing No.C-41, Rajouri Garden, New Delhi-110027 was her matrimonial home and purchased out of her own funds in the joint names of herself and her husband out of natural love and affection and she has instituted proceedings under Section 125 Cr.P.C. against her husband in which the Court restrained the respondent from selling the subject property on 09th March, 2018. It was further notified that the alleged agreement dated 13th August, 2018 was in violation of the stay order dated 09th March, 2018 and was illegal. The respondent’s wife notified the petitioner not to proceed with the agreement.

4. On 19th October, 2018, the respondent intimated the petitioner about the stay order dated 09th March, 2018 passed by the Principal Judge, Family Court, Tis Hazari restraining him from creating any third party interest with respect to the suit property. The respondent intimated the petitioner that he became aware of the stay order on 28th September, 2018. The respondent further notified that the agreement dated 13th August, 2018 was null and void on account of violation of the stay order and therefore, the respondent has returned the advance amount of Rs.1,40,00,000/- to the petitioner by online transfer to the petitioner’s account on 18th October, 2018. The respondent returned the balance Rs.10,00,000/- to the petitioner in January, 2019.

5. On 26th October, 2018, the petitioner instituted a petition under Section 9 of the Arbitration and Conciliation Act being OMP(I) 20/2018 against the respondent which he withdrew on 21st December, 2018.

6. On 12th November, 2018, the petitioner invoked the arbitration by legal notice.

7. On 21st December, 2018, the petitioner instituted this petition for appointment of an arbitrator under Section 11 of the Arbitration and Conciliation Act.

8. The respondent is opposing this petition on the ground that the impugned agreement dated 13th August, 2018 is null and void being in violation of the stay order dated 09th March, 2018 and therefore, not enforceable in law.

Submissions of the petitioner

9. The agreement dated 13th August, 2018 is valid and enforceable. The arbitration agreement between the parties is contained in clause 14 of the agreement dated 13th August, 2018. The petitioner invoked the arbitration vide notice dated 12th November, 2018.

10. With respect to the stay order dated 09th March, 2018, it is submitted that the petitioner was not aware of the stay order dated 09th March, 2018 at the time of execution of the agreement dated 13th August, 2018.

11. The stay order was vacated on 27th August, 2019 when the respondent’s wife withdrew the petition with liberty to file a fresh one and there is no impediment to the enforcement of the agreement dated 13th August, 2018.

12. Even if the stay order is continuing, the petitioner is entitled to the specific performance. It is submitted that the petitioner may be guilty of contempt for violation of the stay order but the petitioner cannot be denied the relief of specific performance.

Submissions of the respondent

13. The respondent is 70 years old and he executed the agreement da