Case Note & Summary
The petitioner, Kamla Homes and Lifestyle Private Limited, a developer, filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996, seeking interim reliefs including appointment of a receiver and injunction against respondent Nos. 2 to 5, who were members of respondent No. 1 society. The developer had entered into a Development Agreement with the society for redevelopment of the property. The dispute arose when respondent Nos. 2 to 5, who were occupying flat No. 11, refused to vacate the premises, claiming entitlement to alternate accommodation. The developer sought possession of the flat for demolition and redevelopment. The court examined whether the dispute was arbitrable under the arbitration agreement. The Development Agreement contained an arbitration clause only for disputes between the developer and the society, not for disputes with individual members. The court held that the dispute regarding possession and entitlement to alternate accommodation was not covered by the arbitration agreement and thus not arbitrable. Consequently, the Section 9 petition was not maintainable. The court further observed that the appropriate remedy for the developer was to approach the Cooperative Court under the Maharashtra Cooperative Societies Act, 1960, which has exclusive jurisdiction over disputes between a society and its members regarding occupation of premises. The petition was dismissed with no order as to costs.
Headnote
A) Arbitration - Interim Relief under Section 9 - Jurisdiction - The court held that a petition under Section 9 of the Arbitration and Conciliation Act, 1996, is maintainable only if the underlying dispute is arbitrable under the arbitration agreement. Since the Development Agreement between the developer and the society did not contain an arbitration clause covering disputes with members regarding possession or alternate accommodation, the Section 9 petition was not maintainable. (Paras 1-10) B) Cooperative Societies - Jurisdiction of Cooperative Court - Disputes between a society and its members regarding occupation of premises fall within the exclusive jurisdiction of the Cooperative Court under the Maharashtra Cooperative Societies Act, 1960. The developer, claiming through the society, cannot bypass this remedy by invoking arbitration. (Paras 11-15) C) Arbitration - Scope of Arbitration Agreement - The arbitration clause in the Development Agreement only covered disputes between the developer and the society, not disputes with individual members. Therefore, the dispute regarding possession of flat No. 11 was not arbitrable, and the Section 9 petition was dismissed. (Paras 16-18)
Issue of Consideration
Whether a developer can seek interim relief under Section 9 of the Arbitration and Conciliation Act, 1996, for possession of premises from society members pending arbitration, when the Development Agreement does not contain an arbitration clause covering such disputes.
Final Decision
The petition is dismissed. No order as to costs.
Law Points
- Section 9 of the Arbitration and Conciliation Act
- 1996
- cannot be invoked for disputes that are not arbitrable under the arbitration agreement
- disputes relating to possession and entitlement to alternate accommodation under a Development Agreement are not arbitrable when the agreement does not provide for arbitration of such disputes
- the Cooperative Court under the Maharashtra Cooperative Societies Act
- 1960
- has exclusive jurisdiction over disputes between a society and its members regarding occupation of premises.
