Case Note & Summary
The petitioner, Jai Neptune Co-operative Housing Society Limited, filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996, seeking interim measures against the respondents, Lotus Logistics & Developers Pvt. Ltd. (developer) and the Slum Rehabilitation Authority (SRA). The petitioner had entered into a development agreement with the developer on 25th February 2008, and an addendum on 13th February 2009, for development of its plot bearing CTS No.310/B. The petitioner alleged that the developer, without its consent, obtained approval from the SRA for a slum rehabilitation scheme on the petitioner's plot and other adjacent plots, and commenced construction. The petitioner sought an injunction restraining the SRA from permitting further construction, directions to revoke permissions, appointment of a court receiver, and other reliefs. The court examined the facts and submissions. The developer contended that the agreement allowed it to obtain necessary approvals and that the petitioner had knowledge of the SRA scheme. The SRA submitted that permissions were granted as per law. The court held that the petitioner failed to make out a prima facie case for interim relief. The balance of convenience was against granting injunction as the project was at an advanced stage and would affect slum dwellers. The petitioner did not demonstrate irreparable injury. The court dismissed the petition, leaving the parties to pursue arbitration.
Headnote
A) Arbitration - Interim Measures under Section 9 - Prima Facie Case - The court considered whether the petitioner had made out a prima facie case for grant of interim injunction against the developer and the Slum Rehabilitation Authority. The court held that the petitioner failed to establish a strong prima facie case as the development agreement permitted the developer to obtain approvals and the petitioner had not objected to the SRA scheme earlier. (Paras 1-10) B) Arbitration - Balance of Convenience and Irreparable Injury - The court examined the balance of convenience and irreparable injury. It held that the balance of convenience was not in favor of the petitioner as the project was at an advanced stage and any injunction would cause greater hardship to the developer and the slum dwellers. The petitioner did not demonstrate irreparable injury. (Paras 11-20) C) Arbitration - Section 9 - Scope of Interim Relief - The court reiterated that the power under Section 9 is to protect the subject matter of arbitration and not to decide the merits. The court declined to grant the relief sought as the petitioner had an alternative remedy by way of arbitration. (Paras 21-25)
Issue of Consideration
Whether the petitioner is entitled to interim relief under Section 9 of the Arbitration and Conciliation Act, 1996, restraining the respondents from proceeding with construction on the petitioner's plot and directing revocation of permissions granted by the Slum Rehabilitation Authority, pending arbitration.
Final Decision
The petition is dismissed. No order as to costs. The parties are at liberty to pursue arbitration.
Law Points
- Section 9 of Arbitration and Conciliation Act
- 1996
- Prima Facie Case
- Balance of Convenience
- Irreparable Injury
- Interim Measures
- Development Agreement
- Slum Rehabilitation Scheme
- Consent of Society
