Case Note & Summary
The petitioner, Shri Krishan Sai Development Corporation, filed an Arbitration Petition under Section 9 of the Arbitration and Conciliation Act, 1996, seeking interim reliefs including appointment of a receiver and possession of Flat Nos. 404 and 202 from respondent nos. 2 and 3, who were members of respondent no. 1 society. The petitioner had entered into a development agreement with the society for redevelopment of the property, which contained an arbitration clause. However, respondent nos. 2 and 3 were not parties to that agreement. The court examined whether interim relief under Section 9 could be granted against persons who are not parties to the arbitration agreement. The court noted that the arbitration clause only bound the petitioner and the society, and respondent nos. 2 and 3, as members, were not signatories and did not claim through the society. The court held that the petition was not maintainable against them as there was no arbitration agreement between the petitioner and respondent nos. 2 and 3. Consequently, the court dismissed the petition, leaving the petitioner to pursue other remedies available in law.
Headnote
A) Arbitration - Interim Relief under Section 9 - Maintainability - The petitioner sought appointment of receiver and possession of flats from respondent nos. 2 and 3, who were not parties to the development agreement containing the arbitration clause - The court held that interim relief under Section 9 can only be granted against a party to the arbitration agreement or a person claiming through such party - Since respondent nos. 2 and 3 were not signatories to the agreement and did not claim through the society, the petition was not maintainable against them (Paras 1-34). B) Arbitration - Parties to Arbitration Agreement - Third Party - The development agreement was between the petitioner and the society only - Respondent nos. 2 and 3, as members of the society, were not bound by the arbitration clause in the absence of any specific agreement or statutory provision making them parties - The court held that the arbitration clause cannot be enforced against non-signatory members (Paras 2-34). C) Arbitration - Interim Relief - Possession of Property - The petitioner sought possession of flats for redevelopment, but the dispute regarding possession was not covered by the arbitration agreement as the members were not parties - The court held that no interim relief could be granted under Section 9 as the main arbitration itself was not maintainable against respondent nos. 2 and 3 (Paras 1-34).
Issue of Consideration
Whether the petitioner is entitled to interim relief under Section 9 of the Arbitration and Conciliation Act, 1996, seeking possession of flats from respondent nos. 2 and 3, who are members of the society but not parties to the development agreement containing the arbitration clause.
Final Decision
The court dismissed the Arbitration Petition, holding that the petition under Section 9 of the Arbitration and Conciliation Act, 1996 is not maintainable against respondent nos. 2 and 3 as they are not parties to the arbitration agreement. The petitioner is at liberty to take such other remedies as may be available in law.
Law Points
- Section 9 of the Arbitration and Conciliation Act
- 1996
- interim relief
- arbitrability
- parties to arbitration agreement
- third party
- redevelopment agreement
- cooperative society
- member's rights
