2018 (11) TMI 1688 - HC - Indian Laws

Appointment of Arbitrator - resolution of dispute between the parties - Section 8 of the Arbitration and Conciliation Act, 1996 - HELD THAT - The dispute between respondent No.1- owner falling under first part and appellant No.1- co-developer falling under third part, are not comprehended by any of the Sub-clauses of Clause-19 so as to refer the same to an Arbitral Tribunal. While the Court below has adopted the same reasoning as was given by us above, it however relied on an additional ground for dismissing the I.As., viz., that unlike the addendum to Supplementary Development Agreement in the present case, the Addendum of the remaining three societies contained a clause for reference of disputes between the owners and the society to an arbitrator. The Court below has rightly declined to refer the dispute raised by respondent No.1 to Arbitral Tribunal - Appeal dismissed.

Summary

Issues:
Interpretation of Clause-19 of the Addendum to the Supplemental Development Agreement for resolving disputes through arbitration between a society and owners.

Analysis:
The appeals arose from identical interlocutory applications filed under the Arbitration and Conciliation Act, 1996, seeking the appointment of an arbitrator to resolve disputes between a society and owners. The core issue revolved around whether Clause-19 of the Addendum to the Agreement covered disputes between the society and owners. The main contention was the interpretation of the clause to determine the scope of disputes subject to arbitration.

The main limb of Clause-19 did not explicitly mention arbitration, while the second limb outlined the procedure for resolving disputes among the parties. The court analyzed sub-clauses (a) to (g) to ascertain the nature of disputes and the parties involved in arbitration. Sub-clause-(e) specifically referred to disputes between owners of the same building, excluding the society described as a co-developer. The court concluded that the disputes between the owner and co-developer were not covered by any sub-clause of Clause-19 for arbitration.

The court upheld the decision of the lower court to dismiss the interlocutory applications, emphasizing that the disputes between the owner and co-developer were not within the purview of the arbitration clause. Additionally, the court noted that the interpretation of Clause-19 was consistent with the reasoning provided by the lower court. The dismissal of the appeals led to the vacating of interim orders and the dismissal of pending miscellaneous petitions.

In conclusion, the court found no merit in the Civil Miscellaneous Appeals, affirming the lower court's decision to decline arbitration for the dispute raised by the owner. The judgment highlighted the importance of interpreting contractual clauses accurately to determine the scope of disputes subject to arbitration, ensuring clarity in resolving legal conflicts between parties involved in agreements.