Disposed

Basera City Developers Private Limited, through its Director Sri Anupam Prakash Pandey v. Uttar Pradesh Avas Evam Vikas Parishad through its Housing Commissioner, and Another

Allahabad HC26 Sept 2024ARBT/22/2024

Case brief

AI extract

What is this about?

A Section 11(6) arbitration application sought appointment of an arbitrator under clause-4 of a hire purchase agreement with UP Avas Evam Vikas Parishad. Applying an earlier coordinate-bench judgment on an identical clause, the court found the clause constituted an arbitration agreement and proposed Justice Renu Agarwal (Retd.) as arbitrator, pending consent.

What did the court decide?

Proposed Mrs Justice Renu Agarwal (Retd.) as arbitrator; pleadings to be sent for disclosure and consent; matter listed after receipt of reply/consent.

Basera City Developers Private Limited, through its Director… — Arbitration | Allahabad HC (2024)

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Court No. - 6

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Case :- CIVIL MISC. ARBITRATION APPLICATION No. - 22 of 2024

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Applicant :- Basera City Developers Private Limited, Through Its Director Sri Anupam Prakash Pandey Opposite Party :- Uttar Pradesh Avas Evam Vikas Parishad Through Its Housing Commissioner, And Another Counsel for Applicant :- Avdhesh Kumar Pandey,Anjali Singh,Sudeep Kumar Counsel for Opposite Party :- Puneet Chandra

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Hon'ble Rajnish Kumar,J.

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Heard Shri Shreshth Srivastava, Advocate holding brief of Shri Sudeep Kumar, learned counsel for the applicant and Shri Puneet Chandra, learned counsel for the respondents.

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This application under Section 11(6) of the Arbitration and Conciliation Act, 1996 (here-in-after referred as the Act of 1996) has been filed for appointment of Arbitrator.

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Learned counsel for the applicant submits that the parties had entered into a higher purchase agreement dated 03.10.2013. Some dispute arose in regard to the compliance of the agreement, therefore invoking the clause-4 of the agreement the applicant gave a notice dated 30.12.2023 for referring the matter to an independent Arbitrator, however the same has not been replied, therefore the applicant has approached this Court.

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He further submits that considering an identical clause in a higher purchase agreement, this Court in Arbitration Application No.44 of 2018 (Palm Infra Properties Pvt. Ltd. Lucknow Vs. U.P. Avas Evam Vikas Parishad Lucknow and Another) has appointed the Arbitrator. Thus, an Arbitrator may be appointed for adjudication of the dispute between the parties.

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Learned counsel for the respondents submits that in view of Section 7 of the Act of 1996 since there is no arbitration clause in the agreement, therefore matter can not be referred for arbitration and the application is liable to be dismissed.

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Having considered the submissions of learned counsel for the parties, I have perused the records.

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The parties had entered into a higher purchase agreement dated 03.10.2013, the clause-4 of which on reproduction reads as under:-

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"4- .. यददउकदवदनयममऔरउनककअधधनदकयकगयकअननबनधककशबददवलधककदनवरचनककयदअननबनधकक अननसदरदकयकगयकयददकयकजदनकककललएपसतददवतदकसधदवदनशचयककबदरकममककईदववददयदमतभकद उतपनहकतकआवदसआयनकदवदनशचयकरकगकऔरदकरदयद - दकशतककतदककललएससयनकरपसकयदपपथक - पपथकऐसददवदनशचयअननतमऔरबदधयकरहकगद l"

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Considering an identical clause-5 in higher purchase agreement executed between the respondent U.P. Avas and Vikas Parishad and Palm Infra Properties Pvt. Ltd., this Court in the case of Arbitration Application No.44 of 2018 has considered the provision made in clause-5 and held that there is an agreement in writing between the parties where they have agreed to refer any and all disputes between them to be decided by the private tribunal of Housing Commissioner. Thus, in the light of the discussions made and applying the principles of clause-5 of the agreement the court is of the considered view that Clause 5 of the agreement between the parties does constitute an arbitration agreement as it has all the attributes of an arbitration agreement. Clause-5 of the agreement as reproduced in the said case is extracted here-in-below:-

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"5. यददउकदवदनयममऔरउनककअधधनदकयकगयकअननबनधककशबददवलधककदनवचरनककयदअननबनधदकयक गयकयददकयकजदनकककललएपसतददवतदकसधदवदनशयचककबदरकममककईदववददयदमदभकदउतपनहकतक आवदसआयनकदवदनशचयकरकगकऔरदकरदयद - दकशतककतदककललएससयनकरपसकयदपपथक - पपथकऐसद दवदनशचयअननतमऔरबदधयकरहकगद। "

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In the aforesaid case, the coordinate Bench of this Court has held as under:-

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"In light of the aforesaid decisions cited by the respective parties, the crux of the entire controversy depends on the construction of the clause 5. From the fine reading of the judgments cited by the respondents, the distinction that is created between a clause which provides for decision to a particular authority to be final and yet not be construed as an arbitration agreement lies in the fact that such decision of the authority is final only in respect of certain matters relating to a contract and moreover it is for the purposes of facilitating and supervising control for smooth execution of work in accordance with the specifications given to ensure that quality of work is not compromised and only to that extent the decision of such authority is final and thus it does not constitute an arbitration agreement.

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However, in cases where all and every type (emphasis supplied) of dispute or difference is referable to an authority and its decision is held to be binding and final then such clause is treated as an arbitration agreement.

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This Court finds that the decision of the Hon'ble Apex Court in the case of Jagdish Chander (supra) very succinctly indicates what would constitute the essential attributes of an arbitration agreement. Applying the principle as laid down by the Hon'ble Apex Court in the case of Jagdish Chander (supra) it would indicate that in the present case as well. The Clause 5 though does not uses the word "arbitrator or arbitration" which in terms of the decision of Bihar State Mineral Development Corporation (supra) does not create any hurdle, till the time the other essential attributes are met.

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From the perusal of the Clause 5, which has been quoted above, it would indicates that the parties had clearly intended that any and all dispute or differences relating to any clause or term of the agreement or relating thereto shall be referred to the Housing Commissioner, who would adjudicate the same and such decision between the parties shall be final and binding. Thus, as indicated that the aforesaid clause contemplates and does not limit to any particular kind, type or part of dispute rather it has on all encompassing clause which states that all the disputes and differences relating to or emerging from the said agreement shall be referred to the Housing Commissioner, who would adjudicate and his adjudication would be final and binding.

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Accordingly, this Court finds that there is an agreement in writing between the parties where they have agreed to refer any and all disputes between them to be decided by the private tribunal of Housing Commissioner. The said tribunal i.e. Housing Commissioner has been empowered to adjudicate and this adjudication has been agreed by the parties to be final and binding on them. This is exactly what the Hon'ble Apex Court in the case of Jagdish Chander (supra) has clearly held.

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The other submission of the learned counsel for the respondent is that since the petitioner has filed a suit and, therefore, there is no need for appointment of an arbitrator.

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Shri Sudeep Kumar, learned counsel for the petitioner has fairly stated that the aforesaid suit had been instituted under mistaken legal advise. He has made a statement at bar that he shall unconditionally withdrawn the suit and it may be treated that the suit shall stand withdrawn and he shall make appropriate application before the court below for withdrawing the same without delay and this Court may adjudicate the controversy involved in the petition.

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Thus, in view of the statement of the learned counsel for the petitioner, second limb of the submission pales into insignificance and the suit shall have no bearing on the merits of this petition.

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Thus, in light of the discussions made above and applying the principles to Clause 5 of the agreement, this Court is of the considered view that Clause 5 of the agreement between the parties does constitute an arbitration agreement as it has all the attributes of an arbitration agreement.

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Thus, since the arbitration clause is found to be in existence in between the parties, accordingly, this Court proposes the name of Hon'ble Sanjay Harkauli (Retd.) Judge of this Court, R/o Flat No.912, F-8, Sagar Presidency, Sector-50, Noida as a proposed arbitrator to decide the dispute between the parties.

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Learned counsel for the petitioner shall provide all the pleadings within a week for seeking the consent in terms of Section 12 of the Act of 1996 from Hon'ble Mr. Justice Sanjay Harkauli (Retd.).

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Put up this matter on 03.07.2019 along with the report regarding the consent from the proposed Arbitrator."

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In view of above and applying the ratio of the judgment of the coordinate Bench, this Court also finds the existence of

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aforesaid arbitration clause-4 and accordingly proposes the name of Hon'ble Mrs. Justice Renu Agarwal ( a former judge of this Court), Resident of House No. A-304, Sector-11, Azea Botonica, Vrindavan Yojna, Lucknow, Mb. No.8400092427 as an Arbitrator in the matter.

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Let a copy of the pleadings on record alongwith the relevant provisions of the amending Act 2015 be sent to Hon'ble Mrs. Justice Renu Agarwal ( a former judge of this Court), Resident of House No. A-304, Sector-11, Azea Botonica, Vrindavan Yojna, Lucknow, Mb. No.8400092427 for eliciting her disclosure in terms of Section 11(8) read with Section 12(1) of the Act of 1996 and Schedule VI and VII as amended by Act 2015, appended thereto, as also her consent for appointment as an Arbitrator for resolving the dispute.

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Learned counsel for the applicant shall supply an additional copy of the application to the office for the said purpose within a week.

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List immediately after receipt of reply/consent.

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................................................................... (Rajnish Kumar, J.) Order Date :- 7.8.2024 Haseen U.

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Digitally signed by :- HASEENUDDIN High Court of Judicature at Allahabad, Lucknow Bench

Basera City Developers Private Limited, through its Director Sri Anupam Prakash Pandey v. Uttar Pradesh Avas Evam Vikas Parishad through its Housing Commissioner, and Another

Case brief

What is this about?

What did the court decide?

Basera City Developers Private Limited, through its Director Sri Anupam Prakash Pandey v. Uttar Pradesh Avas Evam Vikas Parishad through its Housing Commissioner, and Another

Case brief

What is this about?

What did the court decide?

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