MISC. Petition No. 58 of 2025 · The High Court
Case Details
- 1 - NC: 2025:KHC:23414 CMP No. 58 of 2025 HC-KAR IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 1ST DAY OF JULY, 2025 BEFORE THE HON'BLE MR. JUSTICE ASHOK S.KINAGI CIVIL MISC. PETITION NO. 58 OF 2025 BETWEEN: 1. A.V. RAJACHARYA S/O. A. VENKATACHALAIAH, AGED ABOUT 60 YEARS, 2. SMT. R. VIJAYA W/O. A.V RAJACHARYA AGED ABOUT 58 YEARS, 3. R.KIRAN S/O A.V RAJACHARYA AGED ABOUT 33 YEARS. 4. R.DHARMENDRA S/O A.V RAJACHARYA, AGED ABOUT 29 YEARS. PETITIONERS NO.1 TO 4 RESIDING AT "KIRAN FARM", "KANNAMANGALA" VILLAGE AND POST, KASABA HOBLI, DEVANAHALLI TALUK, BENGALURU RURAL DISTRICT - 562 110.
Legal Reasoning
8. There is no dispute regarding the execution of a Joint Development Agreement between the parties to the petition. The grievance of the petitioners is that the respondent did not fulfil the terms and conditions of the Joint Development Agreement dated 10.07.2013. The respondent has failed to commence the construction of - 6 - NC: 2025:KHC:23414 CMP No. 58 of 2025 HC-KAR block B, C, D and A and the commercial complex as on that date of the peititon. The respondent was also required to hand over 40% of the share in block-B to the petitioners as well as the flat numbers that were required to be handed over by the respondent to the petitioners. The petitioners, having fed up with the delaying attitude of the respondent on implementation of the project, invoked the arbitration clause No.31 of the Joint Development Agreement dated 10.07.2013, that reads as follows: "31. Dispute Resolution: 31.1 In case of any disputes as to the design and specifications of the plans and quality of material the decision of the arbitrator shall be final. to regard 31.2 In event of any dispute arising between parties hereto with the interpretation of the terms hereof the same shall be resolved amicably by the parties hereto and incase the same is not resolved the dispute shall be referred to Arbitration in terms of Arbitration and Conciliation Act of 1996. this Agreement or 31.3 Neither party shall sue the other party without prior notice thereof to the other party and pending lis the agreement or obligation undertaken herein by the OWNER shall be in force and not suspended and the rights of DEVELOPER shall be in force unless restrained by a Court. - 7 - NC: 2025:KHC:23414 CMP No. 58 of 2025 HC-KAR 31.4 The Courts in Bangalore/Devanahalli shall alone have the jurisdiction." 9. From the perusal of clause 31 of the Joint Development Agreement, which provides an arbitration clause, it discloses that, any dispute arises between the parties with regard to the agreement dated 10.07.2013, the same shall be resolved amicably by the parties and in case, the same is not resolved, the dispute shall be referred to arbitration. Admittedly, the petitioner issued a notice to the respondent on 17.10.2024 vide Annexure-F to settle the matter amicably, by performing his part of contract in terms of Joint Development Agreement dated 10.07.2013. 10. Notice was issued to the respondent. Despite service of notice, the respondent did not reply to the legal notice. 11. The petitioner, by invoking an arbitration clause, issued an arbitration notice on 20.11.2024 vide - 8 - NC: 2025:KHC:23414 CMP No. 58 of 2025 HC-KAR Annexure-H under Section 31 of the Arbitration and Conciliation Act, 1996. The respondent did not reply to the arbitration notice. There is an arbitration clause in the Joint Development Agreement. The dispute arises between the parties to the petition in terms of the Joint Development agreement has to be resolved through an arbitration. Admittedly, as of these exists an arbitration clause in Joint Development Agreement dated 10.07.2013 and the must be resolved through arbitration. Thus, the petitioners have made out a ground to refer the dispute to the Arbitrator. In view of the above discussion, I answer the point for consideration in affirmative. 12. Accordingly, I proceed to pass the following:
Arguments
(BY SRI. NARAYANA BHAT.M, ADVOCATE) …PETITIONERS Digitally signed by SUNITHA K S Location: HIGH COURT OF KARNATAKA - 2 - NC: 2025:KHC:23414 CMP No. 58 of 2025 HC-KAR AND: SRI. T.U. BALAN, PROPRIETOR, M/S. BIJITH INTERNATIONAL BUILDERS, FLAT NO.109, BIJIT CLASSIC, SY NO.41, K NARAYANAPURA MAIN ROAD, BENGALURU - 560 077. AND ALSO AT "BIJITH KRUPA APARTMENT" OPP POORVA TIVOLI HILLS DEVENAHALLI DODDABALLAPUR ROAD, DEVANAHALLI VILLAGE, DEVANAHALLI TALUK, BENGALURU RURAL DISTRICT - 562 110. (RESPONDENT - SERVED) …RESPONDENT THIS CMP FILED UNDER SECTION 11 OF THE ARBITRATION AND CONCILIATION ACT, 1996 PRAYING TO APPOINT AN ARBITRATOR IN ACCORDANCE WITH CLAUSE 31 OF THE JOINT DEVELOPMENT AGREEMENT DATED 10.07.2013 MARKED AS ANNEXURE A AS AMENDED BY THE ADDENDUM DATED 13.10.2021 MARKED AS ANNEXURE E TO RESOLVE THE DISPUTES BETWEEN THE PETITIONERS AND THE RESPONDENT. THIS PETITION, COMING ON FOR ADMISSION, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE ASHOK S.KINAGI - 3 - NC: 2025:KHC:23414 CMP No. 58 of 2025 HC-KAR ORAL ORDER This Civil Miscellaneous Petition is filed by the petitioners under Section 11(6) of the Arbitration and Conciliation Act, 1996, seeking for an appointment of the Arbitrator in terms of clause 31 of the Joint Development Agreement dated 10.07.2013 vide Annexure-A. 2. Brief facts leading to the filing of this petition are as follows: A joint development agreement came to be entered into between the petitioners and the respondent on 10.07.2013 and the Addendum dated 13.10.2021. A General Power of Attorney was executed by the petitioners on 10.07.2013 in favour of the respondent-company. Building plans were sanctioned in respect of the all five blocks and Commencement certificate was issued, which was served on the respondent. As per the terms and conditions of the Joint Development Agreement, the respondent was recalled to complete the construction of - 4 - NC: 2025:KHC:23414 CMP No. 58 of 2025 HC-KAR residential and commercial complexes including 5 months' grace period. The respondent did not complete the project within the time stipulated in the Joint Development Agreement and the grace period. 3. The petitioner invoked an arbitration clause by issuing a legal notice on 20.11.2024 vide Annexure-H. The respondent did not reply to the arbitration notice. Hence, this petition. 4. Notice was issued to the respondent. Despite service of notice, the respondent remained unrepresented. 5. Heard the arguments of learned counsel for the petitioners. 6. The learned counsel submits that the petitioners and the respondent have entered into a Joint Development Agreement dated 10.07.2013 and it was agreed that the respondent could complete the project within the stipulated period. Despite being granted sufficient - 5 - NC: 2025:KHC:23414 CMP No. 58 of 2025 HC-KAR opportunity, the respondent did not complete the project within the time. The petitioners invoked an arbitration clause by issuing the notice. The respondent did not reply. Hence, he prays to allow the petition. 7. Considering the submissions of the learned counsel for the petitioners, the point that arises for consideration is as follows: "Whether the petitioners have made out a ground to refer the dispute to the arbitrator in terms of clause 31 of the Joint Development Agreement dated 10.07.2013 vide Annexure-A as per the provisions of the Arbitration and Conciliation Act, 1996 and rules."
Decision
ORDER i. The Civil Miscellaneous petition is allowed. ii. Hon’ble Justice Sri. K.Bhakthavatsala, former Judge, High Court of Karnataka, is nominated as - 9 - NC: 2025:KHC:23414 CMP No. 58 of 2025 HC-KAR the sole Arbitrator to resolve the dispute between the parties to the petition, as per the provisions of the Arbitration and Conciliation Act, 1996 and the Rules. iii. The office is directed to communicate this order to the learned sole Arbitrator and the Arbitration and Conciliation Centre, Bengaluru. iv. In view of the disposal of the petition, any pending I.A's if any, disposed of accordingly. Sd/- (ASHOK S.KINAGI) JUDGE PK List No.: 1 Sl No.: 20 CT: BHK