J U D G M E N T

ABHAY S. OKA, J.

1. The application for permission to file special leave petition is allowed. Leave granted.

FACTUAL ASPECTS Signature Not Verified Digitally signed by Anita Malhotra 2. These appeals take exception to the same judgment and Date: 2024.07.25

16:32:05 IST Reason:

order dated 7th July 2023 passed by the High Court of Judicature at Bombay. Therefore, the same are being decided together. We are setting out a few factual aspects necessary for deciding the appeals.

3. On 31st March 1993, the Maharashtra Housing and Area Development Authority (MHADA) executed a lease agreement in respect of the subject property in favour of Andheri Kamgar Nagar Co-operative Housing Society Limited (for short, ‘the Society’). It is stated to be a society of slum dwellers. The Society, by the agreement dated 6th October 1996, appointed M/s. Aurora Properties and Investments (for short, ‘M/s. Aurora’) as the property developer to implement a slum rehabilitation scheme. M/s. Aurora was to construct 237 rehabilitation tenements for slum dwellers and 40 tenements for project-affected persons (PAPs) free of cost and develop the property using the available Floor Space Index (FSI) and dispose of the same. It appears that M/s. Aurora could not discharge its obligations. Therefore, by the agreement dated 22nd September 1999 (described as an agreement for the grant of sub-development rights), the society appointed Bombay Slum Redevelopment Corporation Private Limited (the appellant) as the developer. Apart from taking over the obligations of M/s. Aurora under the development agreement dated 6th October 1996, the appellant corporation agreed to hand over 15,000 square feet of built-up area in the redeveloped property to M/s.Aurora against M/s. Aurora paying the cost of construction at Rs.600 per square foot. After that, the appellant started the development of the property. On 10th March 2003, an agreement was executed by and between the appellant and one Samir Narain Bhojwani (the respondent), under which the appellant retained 45% of the total available FSI and permitted the respondent to construct the free sale area by allotting him FSI to the extent of the remaining 55%. According to the appellant's case, the respondent was appointed as a contractor to carry out the construction activities of the said building on the site. On 3rd July 2004, a deed of confirmation was executed to register the agreement dated 10th March 2003. Thereafter, on 11th September 2009, there was a letter/tripartite agreement executed, to which M/s. Aurora, the appellant and the respondent were parties under which it was agreed that the appellant would provide 22,500 square feet of constructed area to M/s. Aurora instead of 15,000 square feet, which was agreed to be allotted under the agreement dated 22nd September 1999.

4. The dispute began on 22nd March 2012 when the respondent, by his letter, alleged default against the appellant as set out in the said letter. After the letter was sent, there was a prolonged correspondence, exchange of drafts of the sale agreements, etc. Ultimately, the respondent filed a petition before the High Court under Section 11 of the Arbitration and Conciliation Act, 1996 (for short, ‘the Arbitration Act’). An Arbitrator was appointed. The arbitral proceedings concluded in the form of an award made by the Arbitral Tribunal on 7th September 2018 in favour of the respondent (the claimant before the Arbitral Tribunal). Most of the claims made by the respondent were granted. The counter-claim made by the appellant was rejected. The appellant filed a petition under Section 34 of the Arbitration Act before the High Court to challenge the award. By the judgment dated 13th September 2019, the learned Single Judge of the High Court allowed the petition under Section 34 of the Arbitration Act and proceeded to set aside the award on various grounds, such as perversity, patent illegality, etc. The respondent filed an appeal under Section 37(1