Case Note & Summary
The Petitioner, M/s. R.R.B. Realtors Pvt. Ltd., a real estate developer, filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996, seeking appointment of Court Receiver and directions against Respondent Nos. 2 to 8, who were non-cooperating members of Respondent No. 1 Society, to vacate their tenements for redevelopment. The Society had entered into a Development Agreement dated 15th July, 2013 with the Petitioner, and the non-cooperating members had signed individual agreements agreeing to vacate. However, they refused to hand over possession. The Petitioner also sought appointment of Court Receiver for tenements of Respondent Nos. 9 to 11, whose whereabouts were unknown. The Court noted that the Development Agreement contained an arbitration clause, and the dispute was arbitrable. The Court held that the Petitioner had made out a strong prima facie case for interim relief to prevent the redevelopment project from being frustrated. The Court appointed the Court Receiver to take physical possession of the tenements of Respondent Nos. 2 to 8 and hand them over to the Petitioner, and also appointed the Court Receiver for the tenements of Respondent Nos. 9 to 11 with power to take possession after making an inventory. The Court directed the Petitioner to pay agreed rent, shifting charges, etc., to the non-cooperating members. The petition was allowed with these directions.
Headnote
A) Arbitration - Interim Measures - Section 9 of the Arbitration and Conciliation Act, 1996 - Appointment of Court Receiver - Petitioner developer sought appointment of Court Receiver to take possession of tenements occupied by non-cooperating members for redevelopment - Court held that since the Development Agreement contained an arbitration clause and the members had signed individual agreements agreeing to vacate, the Petitioner was entitled to interim protection to prevent frustration of the redevelopment project - Court appointed Court Receiver with power to take physical possession and hand over to Petitioner (Paras 1-10).
Issue of Consideration
Whether the Petitioner is entitled to appointment of Court Receiver and directions for vacating tenements under Section 9 of the Arbitration and Conciliation Act, 1996, pending arbitration, for redevelopment of the society building.
Final Decision
The Court allowed the petition and appointed the Court Receiver to take physical possession of the tenements of Respondent Nos. 2 to 8 and hand them over to the Petitioner. The Court also appointed the Court Receiver for the tenements of Respondent Nos. 9 to 11 with power to take possession after making an inventory. The Petitioner was directed to pay agreed rent, shifting charges, etc., to the non-cooperating members.
Law Points
- Section 9 of the Arbitration and Conciliation Act
- 1996
- Appointment of Court Receiver
- Interim measures
- Non-cooperating members
- Redevelopment agreement
Case Details
2016 LawText (BOM) (12) 30
Arbitration Petition No. 681 of 2016
Dr. Birendra Saraf, along with Mr. Kunal Banage and Mr. Vasin Siddiqui, instructed by Kunal Banage for the Petitioner; Mr. Raj Patel, along with Mr. G.D. Uttangale, instructed by M/s. Uttangale & Co., for Respondent No.1; Mr. A.S. Kharatmol for Respondent Nos. 2 to 8.
M/s. R.R.B. Realtors Pvt. Ltd.
M/s. Subhash Nagar Rajeshwari CHS Ltd. and others
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Nature of Litigation
Petition under Section 9 of the Arbitration and Conciliation Act, 1996 seeking interim measures including appointment of Court Receiver to take possession of tenements for redevelopment.
Remedy Sought
Appointment of Court Receiver for tenements occupied by Respondent Nos. 2 to 8 and 9 to 11, with power to take physical possession and hand over to Petitioner for redevelopment; directions to Respondent Nos. 2 to 8 to vacate and hand over possession.
Filing Reason
Non-cooperating members of the society refused to vacate their tenements despite signing individual agreements and the Development Agreement, hindering redevelopment.
Issues
Whether the Petitioner is entitled to appointment of Court Receiver under Section 9 of the Arbitration and Conciliation Act, 1996.
Whether the non-cooperating members can be directed to vacate pending arbitration.
Submissions/Arguments
Petitioner argued that the Development Agreement contained an arbitration clause and the non-cooperating members had signed individual agreements to vacate, but they were refusing to do so, frustrating the redevelopment project.
Respondent Nos. 2 to 8 opposed the petition, but their specific arguments are not detailed in the provided text.
Ratio Decidendi
Under Section 9 of the Arbitration and Conciliation Act, 1996, the court can grant interim measures to protect the subject matter of the arbitration and prevent frustration of the arbitration agreement. Where a developer has entered into a development agreement with a society and individual agreements with members, and the members refuse to vacate despite contractual obligations, the court may appoint a Court Receiver to take possession to ensure the redevelopment proceeds pending arbitration.
Judgment Excerpts
The above Petition is filed by the Petitioner -- R.R.B. Realtors Pvt. Ltd., under Section 9 of the Arbitration and Conciliation Act, 1996 ('the Act') against the Respondents -- M/s. Subhash Nagar Rajeshwari CHS Ltd. and 10 others...
The Petitioner has therefore prayed for appointment of Court Receiver in respect of the tenements occupied by Respondent Nos. 2 to 8...
Respondents Nos. 2 to 8 are the non-cooperating members of Respondent No-1-society who are refusing to vacate and hand over possession of the respective tenements for redevelopment contrary to their individual agreements as well as the Development Agreement dated 15th July, 2013 executed by the society.
Procedural History
The Petitioner filed Arbitration Petition No. 681 of 2016 under Section 9 of the Arbitration and Conciliation Act, 1996 in the High Court of Bombay. The petition was heard and judgment reserved on 4th July, 2016, and pronounced on 22nd December, 2016.
Acts & Sections
- Arbitration and Conciliation Act, 1996: Section 9
