1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION CIVIL REVISION APPLICATION No. 162 OF 2009 WITH CIVIL REVISION APPLICATION No. 163 OF 2009 Dhangar Samaj Laxmi Bazar Trust ..Petitioner. (Orig. defendant) v/s. M/s.Vasudha Construction ..Respondent. (Orig. plaintiff) ===== Mr. P.K.Dhakephalkar with K.S.Dewal & Sachin Dhakephalkar for the petitioner. Shi B.K.Bali with M/s Ridaya Sawant i/by M/s Bali Associates for respondent. ===== CORAM: A.R.JOSHI, J. DATED : 29TH SEPTEMBER, 2009 P.C.:- 1. Rule, made returnable forthwith. 2. Heard the rival submissions for long time. 3. This revision application is preferred by the original defendant- Trust being aggrieved by the order passed by 2nd Joint Civil Judge, J.D., Kalyan, Dist.Thane (‘the Trial Court’ for short), dated 2nd March 2009 under Exh. 23 in Regular Civil Suit No. 520 of 2008 The said application Exh. 23 was preferred by the present 2 petitioner-original defendant-Trust under Section 8 of the Arbitration and Conciliation Act 1996 (“the Arbitration Act” for short) for referring the said dispute which is the subject matter of the R.C.S.No. 520 of 2000 to the Arbitrator, as per the clause no. 22 of the development agreement dated 31st December 2003, entered into between the present petitioner-defendant as the Trustee and owner of the immovable property and the present respondent-original plaintiff, in whose favour certain development rights were given. 4. Prior to appreciating the rival submissions, the preliminaries of the matter as to filing of the suit can be mentioned. Admittedly, the R.C.S. No. 520 of 2008 is for injunction simplicitor preferred by the respondent-original plaintiff challenging the letter of termination dated 29th June 2007. Said letter of termination was given by the present petitioner-defendant terminating both the agreements for development i.e. first agreement for development dated 31st December 2003 and supplementary development agreement dated 24th February 2006. By both the said agreements, it was inter alia agreed between the plaintiff and defendant-Trust for development of certain plot of land belonging to the defendant 3 Trust and for which the amount of Rs.60 lacs was also to be paid by the plaintiff to the defendant-Trust plus allotment of about 16,200 sq.ft carpet area duly constructed as per the terms and conditions. The payment ought to be made in regular installments and the work was to be started within 24 months of obtaining of the IOD. It appears that by termination letter dated 29th June 2007, various grounds were mentioned as to not giving the payment by the plaintiff to the defendant-Trust in accordance with the agreement and not commencing with the construction within 24 months of obtaining IOD from the competent authority. 5. It appears that on receiving such termination letter dated 29th June 2007, R.C.S. No. 520 of 2008 was filed by the respondent- plaintiff only for simplicitor injunction and for declaration that the said letter of termination is null and void. Apparently, the Suit is valued at Rs.1000/-. In view of this, when such type of suit for injunction simplicitor is coming before the Court, then, it must be shown by the plaintiff that some legal rights and interest is involved. In the present matter, according to the plaintiff, he is authorized to continue with the terms and conditions of the said agreement and supplementary development agreement. In other 4 words, it must be said that the plaintiff wants that the said understanding entered into between the defendant-Trust and the plaintiff is to be specifically enforced and in that event it was incumbent on the plaintiff to value the suit accordingly and also to ask for appropriate relief of specific enforcement, which has not been done. Admittedly, in the present suit, it also appears that there is no separate leave obtained from the Trial Court under Order II, Rule 2 of the Civil Procedure Code reserving right for any other relief of specific enforcement of the agreements at the time of filing of the suit. The suit was filed for declaration and injunction. The aspect of leave under Order 2, Rule 2 not taken is to be decided by the concerned court with which the suit is pending. 6. What is before this court is to see whether the order passed below Exh.23 is required to be set aside, in view of the submissions by the parties and in view of the contents of paragraph no.22 of the original agreement dated 31st December 2003 . The said paragraph No.22 is reproduced hereunder : “22. IN case of any disputes, doubts, or differences arising between the parties hereto, in respect of the any of the terms and conditions 5 of this agreement or in respect of interpretation, of any of the terms or conditions of this presents or in respect of any other matter, cause or thing whatsoever not contained herein otherwise provided for, the same shall be referred to adjudication to the Arbitration subject to the provisions of the Arbitration and Conciliation Act, 1996 or any statutory modifications or re-enactment thereof for the time being in force, and each party shall appoint one arbitrator and such arbitrators shall elect one umpire and decision of the said Arbitrators shall be binding upon the parties.” 7. In the above paragraph no.22, there are no specific words that apart from the interpretation of any of the terms and conditions of the agreement, there is no scope for over extraneous things to be referred to the Arbitrator. On the contrary, it is specifically mentioned as to : “or in respect of any other matter, cause or thing whatsoever not contained herein otherwise provided for, the same shall be referred for adjudication to the Arbitration subject to the provisions of the Arbitration and Conciliation Act, 1996 ...........”. 6 This reference is specifically mentioned before this Court as there is strong argument on behalf of the respondent-plaintiff that one of the cause mentioned in the termination letter is regarding non- payment of certain installments as per the agreement, mentioned by the Trustees and for which there was no any provision mentioned in the original agreement dated 31st December 2003 or supplementary development agreement, dated 27th February 2006. It is submitted by the learned advocate for the respondent-plaintiff that this being not forming part of the understanding between the parties, this issue cannot be referred to the Arbitrator and though it is considered that other issues as to not commencing the construction within 24 months, or not obeying other conditions of the agreement can be referred to the Arbitrator. On this aspect, as to non-applicability of Section 8 of the Arbitration Act, when certain issues are beyond the scope of the agreement between the parties, the following authorities were cited : “(2003) 5 Supreme Court Cases 531 Sukanya Holdings (P) Ltd. Versus Jayesh H. Pandya & Anr. AND A.I.R 1953 Sup. Court 182 Gaya Electric Supply Co., Ltd. 7 Versus State of Bihar” 8. In the opinion of this Court, the ratio propounded these matters, can not be squarely applicable so far as the facts of the present matter are concerned. 9. It appears that, the trial court while rejecting the application-Exh. 23, got itself in confusion and mentioned in para no.8 to the following effect : “....So far as this suit and this application are concerned, the subject matter of the suit is not subject matter of the development agreement. Therefore, the provisions of Section 8(1) of the Arbitration and Conciliation Act are not applicable.” Definitely, the subject matter of the suit is the enforcement of conditions of the development agreement. Plaintiff wants to assert his right under the said agreement. Again, at this juncture, it must be mentioned that he had not asked for the specific enforcement of the agreement and only asked for declaration of the order of termination passed by the Trust as null and void. All the same reasoning given by the trial Judge is erroneous and cannot be accepted. It is argued on behalf of the respondent-plaintiff that in view of Section 36(3) of the Bombay Public Trusts Act, 1950 8 there should have been an application and reference made to the Charity Commissioner by the petitioner-defendant and there should not have been revocation of the earlier sanction given for the alienation of the Trust property. In other words, it is submitted that instead of straightway terminating the earlier agreement, respondent-defendant should have applied to the Charity Commissioner for revocation of earlier sanction granted for alienation of the property and sanction given for creating the interest in favour of the respondent-plaintiff. 10.In the opinion of this Court, the provisions of Sub-section (3) of Section 36 cannot be interpreted in the way it has been argued. Again on this ground, it is submitted that the defendants had approached the Charity Commissioner for revocation of the earlier permission and during pendency of the same, still, the letter of termination was issued. In fact , in the pleadings of the parties, there is nothing on record to show that such application is made to the Charity Commissioner for revocation of earlier permission given. Otherwise also there cannot be any application of provisions of Section 36 coming in the way for the Court to refer the matter to Arbitration. 9 11.It is also argued on behalf of respondent-plaintiff that the application-Exh.23 is made not in accordance with the Rules framed by the High Court under Section 44 of the Arbitration Act, in as much as, the mode of application is erroneous so also contents of the petition. It is submitted that it was must for the defendants to file an independent application before the Registry and which was required to have been separately numbered like plaint and it should be accompanied by the certified copies of the arbitration agreement. On this technical ground challenging the very inception of the application for referring the matter to arbitration, the learned advocate for the petitioner-defendant submitted that certain variations in the facts and contents are permitted as per the circumstances of each case and as such there is specific mention to that effect in the said rules, of which the shelter has been taken on behalf of the plaintiff-respondent. It is also submitted by the advocate for the petitioner that in the title of application, it is specifically mentioned that the application is under Section 8 of the Arbitration Act. It is further submitted that proper application was preferred to the Court, however, it was the administrative act, on the part of the Court to take it in 10 proceedings at Exh.23 and not making it as independent application for being separately numbered. There is also verification under the said application and also there was compliance of rules. It is also submitted that certified copies of development agreement and the supplemental agreement were annexed thereto. By pointing out the above, it is specifically submitted that there is sufficient compliance of the rules framed by the High Court under Section 44 of the Arbitration and Conciliation Act, 1996 and as such, merely on this technicality, the application would be considered as non-est. 12.Considering the rival submissions, the contents of the agreement, the contents of the supplementary development agreement and the terms and conditions entered between the parties, it must be said that the Trial court had erred in rejecting the application for referring the dispute to the arbitration and as such the said impugned order is required to be set aside. Consequently, the present civil revision application is accordingly disposed of with the following order : ORDER (1) Civil Revision Application No. 162 of 2009 11 is allowed. The impugned order passed by the 2nd Joint Civil Judge, J.D., Kalyan below Exh.23, dated 2nd March 2009 in Regular Civil Suit No.520 of 2007 is set aside. The prayers in the said application-Exh.23 are allowed. Rule is made absolute accordingly. (2) In view of passing of the orders in connecting Civil Revision Application 162 of 2009, the prayers in Civil Revision Application No.163 of 2009 become redundant and as such, the said Civil Revision Application is accordingly disposed of. (A.R.JOSHI,J.)