Case Note & Summary
The petitioner, Shree Krishna Homes Pvt. Ltd., a developer, entered into a development agreement dated 14th December 2011 with respondent No.1, a cooperative housing society, and its 11 members (respondents 2 to 12) for redevelopment of their building. Subsequently, due to changes in DC Rules, the parties entered into a supplemental agreement on 15th October 2012 altering certain terms. However, five out of eleven members (holding six flats) backed out of the agreements. The petitioner invoked the arbitration clause and sought appointment of an arbitrator. Pending arbitration, the petitioner applied for interim relief under Section 9 of the Arbitration and Conciliation Act, 1996, seeking appointment of a Court Receiver to take possession of the dissenting members' flats with powers to break open locks and take police help if necessary, and to hand over possession to the petitioner for redevelopment. The dissenting members accepted the initial development agreement but claimed that the supplemental agreement was prejudicial to them and beneficial to the developer. The Court considered the submissions and held that since the dissenting members accepted the initial agreement but not the supplemental agreement, and the matter involved disputed facts, the balance of convenience favored appointment of a Receiver to preserve the subject matter pending arbitration. The Court appointed the Court Receiver to take possession of the dissenting members' flats and hand them over to the petitioner for redevelopment, subject to the petitioner furnishing an undertaking to abide by the final award and to compensate the dissenting members if necessary.
Headnote
A) Arbitration - Interim Relief - Section 9 of the Arbitration and Conciliation Act, 1996 - Appointment of Court Receiver - The petitioner-developer sought appointment of Court Receiver to take possession of flats of dissenting members who backed out of a supplemental agreement, for redevelopment. The Court held that since the dissenting members accepted the initial development agreement but not the supplemental agreement, and the matter involved disputed facts, the balance of convenience favored appointment of a Receiver to preserve the subject matter pending arbitration. (Paras 1-5)
Issue of Consideration
Whether the petitioner-developer is entitled to interim relief of appointment of Court Receiver to take possession of flats of dissenting members pending arbitration, for the purpose of redevelopment.
Final Decision
The Court appointed the Court Receiver to take possession of the flats of the dissenting members and hand over possession to the petitioner for redevelopment, subject to the petitioner furnishing an undertaking to abide by the final award and compensate if necessary.
Law Points
- Arbitration and Conciliation Act
- 1996
- Section 9
- Interim Measures
- Court Receiver
- Appointment
- Possession
- Development Agreement
- Supplemental Agreement
- Dissenting Members
