Allowed

Mohd Hasen v. Mohammed Dasthagiri and Anr.

Telangana HC20 Oct 2022CRP/1888/2015

Case brief

AI extract

What is this about?

Civil Revisions Petitioner challenged the numbering of an execution petition based on a village elders' award. The Court held that without an arbitration clause, the award was unenforceable and the execution petition was impermissible.

What did the court decide?

Impugned order numbering execution petition was set aside and the execution petition was dismissed.

Mohd Hasen Vs Mohammed Dasthagiri and Anr. — Arbitration | Telangana HC (2022)

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IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD

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THURSDAY,THE TWENTIETH DAY OF OCTOBER TWO THOUSAND AND TWENTY TWO

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PRESENT

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THE HON'BLE SRI JUSTICE A,VENKATESHWARA REDDY

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CIVIL REVISION PETITION NO: 1888 OF 2015

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Petition under Article 227 ot the Constitution of lndia aggrieved by the order in EP No.485 of 2014 on the file of the Court of the Principal District Judge at Warangal.

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Between:

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Mohd. Hasen, S/o.Yakub Ali, aged 51 years, Occ: Agriculture R/o.Gavicherla Village, Sengam Mandal, Warangal District.

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...PETITIONERYJUDGMENT DEBTOR

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AND

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Mohammed Dasthagiri, S/o.Mahaboob Ali, aged 41^years, Occ: Agriculture Rl/o.Gavicherla Village, Sengem Mandal, Warangal District.

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Mohammed Mahaboob Ali, S/o.Mahaboob Ali, aged 61^years, Occ: Agriculture R/o.Gavicherla Village, Sengem Mandal, Warangal District.

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...RESPONDENTS/DECREE HOLDERS

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l.A. NO: 1 OF 201s(CRPMP. NO: 2510 OF²⁰¹⁵⁾

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Petition under Section^'151 CPC^praying that in the circumstances statedⁱⁿ the affidavit filed therewith, the High^Court may be^pleased stay all further p[oceedings pursuant to notice in the EP No.4B5/2014 served on petitition herein in the interest of^justice

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Counsel for the Petitioner: SRI S. LAKSHNII^K,ANTH

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Counsel for the Respondent No.1: SRI^{P. DEVENDER}

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Counsel forthe Respondent No.2: NONE^APPEARED

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The Court made the following: ORDER

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THE HON'BLI SRI JUSTICE A.VENKATESH\IrIIlLr\ REDDY CIVIL R I)VISION PETITION NO. I888 OII 2iOI5 ORDER

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This Civ I Revision Petition is filed under Arl-ic1,: 227 of the Constil r-ltion of India by the petitioner^/ jrrdg;ment debtor aggrie' ed by numbering of E.P.No.485 of 2O l4 on the file of the Principal District Judge at !/arangr,Ll cn the basis of an unenforceable deed of agree'r r,:r t dated 12.06.2013 r [eging that the petitioner is orvner and possessor of -he agricultural land admeasur r.g Ar:. 1-30 guntas in S '.Nos.467 and 468 of Gavicher ir Village, Sengem Manc ,ai, Warangal District.

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2 . It r s submitted by revision petiti,rnr:r th at he was intendinl to sell the said propert5r and appr:r;zrch,:d the 2"d responde: rt aird entered into an agreemer t cf sale at Rs.4,70,000/ per acre against the prevailing nrurrKet value of Rs.10,00,C)0/- per acre in the said localiry. He was deceived by the respondents, particrllarlv tht: 2^d respondent h ,rs acted with malafide intentions a.nd made the petitione r to enter into agreement ol' t;erle dated O9.O7.2O12. As per terms of the said agret:ment, the

AVR.J ( RP 1888 20ri

purchaser Sri Mohammed Dasthagiri i.e. the 1"t respondent herein has to pay the balance sale consideration on or before 15.03.2013 and get the sale deed registered but he failed to pay the balance sale consideration and thereafter, the petitioner, having reaJized the intention of the respondents, got issued lega1 notice dated 13.06.2013 cancelling the said agreement of sa,ie and also enclosed Demand Draft bearing No.79O002, dated 13.06.2013 for Rs.4,50,000/-. While so, the respondent No.2 convened a meeting before the village elders r,"'herein the petitioner was forced to agree to receive Rs.5,1O,O0O/instead of Rs.4,70,000/- as agreed in the agreement of sale dated 09.O7.2012 but the l"t respondent is not a signatory to the said resolution. Respondent No. 1 alone is party to the agreement entered between the parties ald there is no privity of contract between the petitioner and 2d respondent and the alleged resolution dated 12.06.20i3, passed by the elders is not binding. Thus, the learned Principal District Judge erred in numbering the execution petition against the petitioner.

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AVR.J ( RI lli88 :1)li

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H ,:ard learned counsel on lrotl-r sides. Submissions rnade on either side have re:eive I due consideratior ol this Court.

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T'rirt on 09.O7.2012 the petitirrnr::r herein Mohd.Hasen has executed the agreement of sirle in favour of Mohammt,l Dasthagiri i.e. the 1"t responderrt,^rr[,, i" ,n. father of 2rl respondent 1n respect of agricr.rlturril land admeasurinl Ac. 1-30 guntas 1n Sy.Nos.46'Z ,rnd 468 of Gavicherla ,/illage, Sengem Mandal, War.a.rr qal )istrict agreeing to r r:ll the said land at Rs.4,70,000/- per a,:re and received Rs.^r,00,000/- agreeing to receive the sraid ilmount on or befor' 15.03.2013 after measuremerlr oi tlie said land and to execute registered sale deed. It e,ppears that the petitionr r / judgment debtor has failed to comply the terms of a5 reement and the matter was refr:rred to the Panchayat e lders. As per the agreement datr:r1 12.0,1.2013, in the pres 3nce of Panchayat elders, a setl.lement was arrived at t ,:tween the petitioner and the 12,,d reslrondent and as per the said agreement dated 12.Cr6.2013 it was decided by ee elders to enhance the rate to I?r;.5, 1 ),000/\ per acre a^.rd the vendee shall pay the s€ud xnount \

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AVIt.J ( RP r888 20ri

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immediately and get the land registered. However, immediately on 13.06.2013 the petitioner herein, having realized the malafide intentions of the respondents, has got issued legal notice dated 13.06.2013 cancelling the said agreement dated 09.07.2012 and also enclosing a Demand Draft for Rs.a,50,OOO/- to the said legal notice. The respondents have got issued a suitable reply dated 05.07.2013 stating that the said award of elders is equivalent to civil Court's decree under Arbitration and Conciliation Act and it cannot be cancelled unilaterallv and that the respondents are entitled to execute the said award

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A re-joinder notice was also issued on lO.O7.2Ol3 and thereafter, the respondents have filed Execution Petition vide E.P.No.485 of 2014 before the Principal District Judge at Warangal and that the action of assigning number or registering the Execution Petition is assailed by the petitioner herein alleging that the award of the elders is not binding, there is no arbitration clause in the agreement and Mohammed Dasthagiri i.e. the l"t

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cR, lnlis 2015

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respondent, in whose favour the said allr eerner It was executed, is rot a party to the award.

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Ir is true that as per the agreernent dated O9.O7.2O12, it was executed in favour c,f Moh,mmed Dasthagiri, i/o.Mohammed Mahaboob AJi by the revision petitioner h, rein rriz.Mohd.Hasen and whereas, as rer the settlement agreement arrived at before th: elc.ers on 12.06.2013, Mohammed Dasthagiri is not^,a. llarty to the proceedings and that the revision petiti,cn,:r and 2"d respondent are only the parties. Thus, though the agreement rf sale dated O9.O7.2012 is betwe:n the petitioner r rnd the 1"t respondent, rvhereas t.he 1"t respondent is not a party to the zr.lle'ged award dated12.O6.2O13. In-fact, there is no arbitration clause in the entire E;reement dated 09.07.2OL2. The rirrl_r, cc,ndition that is menl ioned therein is that after measure:nent of land on or befo'e 15.03.2013 the revision petitioner herein would execr te registered sale deed in favour of Mohammed Dasthagiri i e. the l"t respondent on receiving the balairce sale conside ration, but curiously on L2.O6.2r)li3 the alleged award was rxecuted between the petitioner hr,rein, who is

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cRP_ rR88 l0ri

the judgment debtor and the 2'd respondent, who is the son of Mohammed Dasthagiri i.e. the 1*t respondent herein, wherein it was decided by the elders to enhance the price of the land to Rs.5,1O,OO0/-. However immediately, upon realizing the conspiracy, the revision petitioner has got issued legal notice dated 13.06.2013 to both the respondents cancelling the said agreement of sale and the award and also sent a Demand Draft for an amount of Rs.4,5O,OO0/- along with the said notice. Nowhere in the reply notice the factum of sending the Demand Dra-ft for Rs.4,50,0O0/- by the revision petitioner is denied. On the other hand, it is mentioned that the award has become a decree under Arbitration and Conciliation Act and the revlsl0n petitioner cannot unilaterally send bankers' cheque declaring the cancellation of agreement and that the award has become a decree for specific performance in favour of the respondents and they are entitled to take steps for execution of the same.

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Be it stated that Mohammed Dasthagiri i.e. the l"t respondent in^whose favour^{the agreement} of sale was executed is not a party to the^agreement or the award of I ) I

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AVR.I ( Rr 1888 20 r5

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the elders da ecl 12.06.2013. There is no privitv o:'ccntract between the 2"d respondent and the pt:titiorter lrerein. Mohammed I^rasthagiri i.e. the 1"t respondent ir, not r. pa-rty to the proce,:dings dated 12.O6.2O13 before the^,:lders. There is no lause in the agreement for refe:'t:nce of the disputes to tl e arbitrators.

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Ar per Section 2(bl of Arbilr,ltion and Conciliation Ar:t, 1996, as amended u'.e.f C4 11.2020, arbitration 4 ;reement mears an agreement rcferrec to in Section 7 of he Act. Essentials of arbitration Ergre()ment, as envis:ger in Section 7 of the Act, i e th:rt the arbitration al reement means an agreement trr tl:e parties to submit to ilrbitrator all or certain disprrtes rlhiclr have arisen or wh ch may arise between them in rt:spect of a dehned legal relationship, whether contrac t ua,i o.- not. Such an art ..tration agreement may be in lhe form of arbitration cli ruse in a contract or in the form of a se )a-rate agreement. Whenever it is a separato arbit ration --jrgreement, it :;hall be in writing, signed by the prrr.ties..

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Here in the instant case undisputedly neither there is any clause for arbitration in the agreement dated 09.O7 .2072 nor there is any separate arbitration agreement between the parties. When there was no arbitration clause in the agreement dated O9.O7.2012 the matter was referred to the village elders on 12.06.2013 and an agreement was entered between the 2"a respondent and the petitioner though the 2"d respondent is not a party to the agreement dated 09.07.2012 and that the first respondent in whose lavour the agreement of sale is executed is not a party to the said alleged award dated 12.06.2013, passed by the village elders. But the respondents, invoking the provisions of Section 36 of Arbitration and Conciliation Act approached the Principal Civil Court for enforcement of the said award and filed the Execution Petition, which was numbered by the Principal District Court assailing the same the Revision Petition is filed.

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Learned counsel for the revision^petitioner would submit that the respondents are not entitled to invoke the provisions of Section^{36 of Arbitrationand} ... Conciliation Act and that as^{per Section} 34 of the Act, -j^oL .p

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there is a pt r:iod of sixty days as mentionecl f,rr fil.ng an application t r set aside the arbitral awa-rd. .irr llie instant case, the aJ eged award is passed on l2.A€. .2,013 and Execution Pr:-ition is filed on 26.08.20 13 befrrre exciry of 30 days per ocl AS contemplated under Se<:tiorr 3,1(3) of Arbitration a rd Conciiiation Act. The alleged i1;reenrent of sa-le dated .)9.O7 .2013 is not a registere i d ocrrment. Undisputedll it is hit by Section 17 of Regrstration Act and Section 35 o Indian Stamp Act and it is not r:nfor':eab1e. Learned cot nsel for the petitioner has relir:cl r,n the principles lai I in the following decisions:

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(1) C raran Sharan Khemka Vs. M/s.Ar:hint C remicals and anotherr.

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(2) S ram Rao and three others Vs. Illlahadevi a rd nine others2.

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1 1. L'arned counsel for the petitioner als<- relied on the principl s laid in Civil Revision Petitiorr l\os.1340; 1779, 1533,2140 and 2841 o{ 2Ol5 of Divis:on Bench of Erstwhile H ;1h Court of Andhra Pradesn 'Potlab:rthuni Srikanth ar d others Vs.Shriram City Urrion F:.nance Limited).

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,04 SCC OnLine iajasthan 166

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,15 SCC OnLine {lderabad 524

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Per contra, learned counsel for the respondents would submit that the civil revision petition is a premature one, the revision petitioner is at liberty to take all such pleas before the execution Court and this Court cannot decide at this st2ge as to whether the Execution Petition is maintainable or not and that the parties may be relegated to the Principal District Judge's Court with a liberty to raise all such issues and it is the trial Court, which has to decide the execution petition on merits.

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In Charan Sharan Khemka case (1st supra) a learned Single Judge of Rajasthan High Court, while dealing with essentials of arbitral award, held that when a document does not contain essentia-l ingredients, it does not be given the status of arbitral award and it is not executable under Section 36 of the Act.

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In Sham Rao case (2"d supra) learned Single Judge of Erstwhile High Court of Andhra Pradesh, while dealing with the nomenclature of the document, defined the essentials of arbitration agreement^as defined under Section 2(a) of Arbitration and^Conciliation Act.

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-4./

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1 5. A plain reading of Section 2 (e ) and (b) of Arbitration r nd Conciliation Act makes it clear that arbitration a :ireement means an agreemen,- rrs rr ferred under Sectiot 7 of the Act and such clause fo: arbitration may be mad : part of the agreement or Lhere rnal be a sepa-rate agn ement for arbitration. Whene ver su lh an agreement is there, it must be in writing, signr:cl b1' both the parties. 'Vhereas, in the present case ther,: is nc such arbitration cl ruse in the agreement dated O9.(l't.')-Ol2 nor there is any separate arbitration agreement lrr:twee n the parties. Hen( ,:, the reference of matter to the r illerge :lders and passing ,,f anY such award dated 12.06.201..1 a-e not enforceable under Section 36 of Arbitre-tion and Conciliation 1r:t. As such immediately on the next date i.e. on 13.06.20 I ] itself, the revision petitioner h;rs got issued a legal notice b1' returning the amount receivei, thro ugh a Demand Draf annexed to the said notice and t rv:rs r:plied by the respor rlents and a re-joinder was also ir;suetl. By no stretch of magination the document date(l 12.06.2013 would be cal ,:d as an arbitration award fo:: th,: simple reason that the said award is not signt:d b1 the-

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l"t respondent, who is a party to the agreement of sale dated 09.07.2OL2 and that it is only signed by the lna respondent, who is the son of 1.t respondent and that there is no clause of arbitration either in the agreement dated 09.07 .2012 or there is any separate agreement.

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1 6. In that view of the matter, in my considered opinion, learned Principal District Judge at Warangal erred in entertaining the execution petition basing on the said award dated 12.06.2013, which has no binding force for the simple reason that there is no clause for arbitration in the agreement of sale dated 09.07.2012 and that the parties to the said document dated 09.07.2012 arc not the parties to the alleged arbitration award dated 12.06.2013. In that view of the matter, the order impugned assigning the number to execution petition basing on the said award dated 12.06.2013 is iiable to be set aside by invoking the powers conferred under Article 227 of Constitution of India to rectify the^{jurisdictional} errors^committed by the Court

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below.

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Ir the result, this Civil Revisicr F'etition is allowecl, ord ,:r impugned numbering Execuri:n F'etition vide E.p.No.z E5 of 2O l4 on the file of the l)ri;r,:ipr I)istrict Judge, Ware ngal is hereby set aside. Const:r;u.en,ly the said Bxecutir n Petition in E.P.No.485 of 2Ol4 s dismissed. In the circun stances of the case, there sha-il lrt no order as to the costs. Miscellaneous applications, if rrrrl pr nding, shall stands losed.

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SD/. .KRI SHNA^KUMAR DI:PUTY REGISTRAR ,/

,TRUE COPY' w

SEC'TION^OFFICER

To,

I H? 'J8?JSil^{il"ulj'l*??.3lH:11"9?ik} rp,pucr 5. 5; 6c^{i; s;i il. Devenoer, Advocate[oPUC]}

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