THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY A.A.NO.181 OF 2010 ORDER This application has been taken out under Section 11 (5) of the Arbitration & Conciliation Act, 1996 read with Rule 2 (b) of the Scheme for appointment of arbitrators, seeking appointment of an Arbitrator for adjudication of the claims and disputes between the parties relatable to the Agreement for Construction dated 14-05-2009. The application averments in brief are : M/s.Maytas Properties Limited is the applicant. Mr.Prashant Konda represented by his GPA Holder is the respondent. The applicant company is incorporated under the provisions of the Companies Act, 1956. It is engaged in the business of construction and development of commercial and residential buildings. It took up the project at Bachupally under the name and style of “Maytas Hill County”. The respondent approached the applicant with a request for purchasing an apartment being Unit No.630 in Apartment No.12A, 12th Floor, Block Name: Munnar in the said Maytas Hill County project. Initially, Mr.K.Uma Kanth Reddy proposed to purchase apartment in Unit No.646 and entered into an agreement for sale with the applicant company on 18-10-2006. Subsequently, K. Uma Kanth Reddy made a request for swapping from Unit No.646 to 6530 on 4-12-2007. The said apartment allotted to K.Uma Kanth Reddy has been transferred to the respondent pursuant to a request for transfer lodged with the applicant on 4-12-2007. Upon transfer of the semi-finished apartment to the respondent, the respondent and the applicant entered into an Agreement dated 14-05-2009 for construction and completion of the said apartment. The land owners and the applicant executed a registered sale deed on 14-5-2009 in favour of the respondent in respect of semi finished flat. Maytas Hill County project was commenced and was being executed by the applicant as per schedule. Due to mis-information disseminated by the electronic and press media, the private equity investors and financial institutions which had committed funding to the applicant company resiled and withdrew from the Hill County Project causing serious and acute shortage of funds which affected the completion of the Hill County Project. The applicant company contacted its customers and appraised them as to the progress of the project and also intimated to them the factors beyond the control of the applicant company which have caused delay in the implementation of the project. The respondent issued notice dated 2-2-2010 terminating the agreement for construction and sought for cancellation of the sale deed and refund of the money and thereby, disputes occurred between the parties relatable to the construction agreement. As per Clause 6 of the Agreement for Construction, the disputes are required to be resolved by taking recourse to the provisions of Arbitration and Conciliation Act, 1996. The applicant addressed a letter dated 30-3-2010 to the respondent nominating Justice Sri V.Bhasker Rao (retired) as the sole arbitrator for resolution of the disputes that have been cropped up relatable to the construction agreement dated 14-5-2009. The respondent issued reply dated 15-4-2010 declining to give consent for appointment of Justice Sri V.Bhasker Rao (retired) as arbitrator. Hence, the application with the prayer stated supra. Notice to the respondent came to be ordered on 1-12-2010. The respondent entered appearance through a counsel and filed counter-affidavit. It is stated in the counter that the applicant company has agreed to complete the project by 31-12-2008 under the construction agreement dated 14-5-2009. In case of any further delay, the applicant company agreed to pay compensation of Rs.5/- per month per square feet for a further period of eight months. The extended period also came to be expired by 30-11-2009. The applicant failed to develop the proposed building complexes and also to develop the appurtenant land of the project. As the applicant failed to provide the services as promised, the respondent filed a complaint before the Andhra Pradesh State Consumer Redressel Commission claiming a sum of Rs.60,94,913/- for deficiency in the services. The applicant entered appearance in C.C.No.77 of 2010 and questioned the jurisdiction of the A.P. State Consumer Redressel Commission for entertaining the complaint. The objection raised by the applicant company came to be rejected and thereupon the applicant company approached the High Court. Heard learned counsel appearing for the applicant and learned counsel appearing for the respondent. Learned counsel appearing for the applicant submits that the disputes between the applicant and the respondent are relatable to construction agreement and as per the terms of construction agreement, the disputes and differences are required to be resolved by taking recourse to the provisions of Arbitration and Conciliation Act,1996. Thus, the application is maintainable. A further submission has been made that the dismissal of the application filed by the applicant before the State Consumer Redressel Commission raising objection to the very maintainability of the case is in no way hampers the applicant to approach this Court invoking the provisions of the Arbitration and Conciliation Act seeking appointment of an arbitrator. Learned counsel refers to Clause 6 of the construction agreement dated 14-5-2009, which reads as hereunder: “In the event of any dispute between the parties in connection with the validity, interpretation, implementation or breach of any provisions of this agreement or any other disputes including the question of whether there is a p[roper termination of the agreement shall be resolved through arbitration. The decision of the Arbitrator shall be final and binding on both parties. The arbitration proceeding shall be in accordance with the provisions laid down in the Arbitration and Conciliation Act, 1996 and shall be governed by the laws in A.P. subject to the authorized arbitration clauses. The venue for the Arbitration proceedings shall be Hyderabad and the language shall be in English. All the proceedings are subject to the exclusive jurisdiction of the Courts at Hyderabad limits.” Learned counsel for the respondent submits that the applicant having become unsuccessful in an application moved under Section 8 of the Arbitration and Conciliation Act before the A.P. State Consumer Redressel Commission, cannot be permitted to invoke the provisions of the self same Act. He would also contend that there is no factual dispute which is required to be resolved in view of admission of the applicant company with regard to receiving the entire sale consideration of the apartment and what is left over is repayment of money by the applicant company since the applicant company failed to complete the construction of the flat. There cannot be any adjudication on the admitted liability. In a way, the contention of the counsel is that the applicant company received the total consideration of the apartment and having received the total consideration failed to complete the construction and thereupon, the respondent terminated the construction agreement in which event the applicant company is bound to return the amount which has been received under the construction agreement dated 14-5-2009. Indisputably, the respondent and others filed complaints before the A.P. State Consumer Redressel Commission claiming compensation for deficiency in the services offered by the applicant company. The applicant company appeared before the A.P. State Consumer Redressel Commission and raised objection with regard to maintainability of the complaints. The A.P. State Consumer Redressel Commission overruled the objection raised by the applicant company. Thereupon, the applicant company filed WP No. 27689 of 2010 and batch. A Division Bench of this Court dismissed batch of writ petitions by an order dated 29-4-2011. The writ petitions came to be dismissed on the ground that remedy provided under 1986 Act is not in derogation of the other remedies to a party. For better appreciation, I may refer the relevant portion of the order passed by the Division Bench of this Court in the above batch of writ petitions, which reads as under: “Having regard to the interpretation given by the Supreme Court in FAIR AIR ENGINEERS PVT.LTD (supra) with regard to Section 3 of the 1986 Act and the ratio in LUCKNOW DEVELOPMENT AUTHORITY (supra), we are of the view that the 1986 Act, being a special enactment, created an additional remedy in favour of the consumers to raise consumer disputes before the For a constituted under the said Act, and that Section 8 of the Arbitration Act does not have the effect of taking away such a remedy from the consumers as in the case of civil suits, which are in the nature of common law remedies. If a party chooses to avail a remedy other than the consumer dispute, he shall be free to do so because the remedy under the 1986 Act is not in derogation of the other remedies available to such a party and he cannot be denied such right on the ground of availability of an alternative remedy, such as Arbitration Act as Section 3 of the 1986 Act is intended to provide an additional remedy to a party and the same is not meant to deny such a remedy to him. Further, by virtue of Section 17 of the Consumer Protection Act the parties can undoubtedly resort to filing of the complaint as specified under Section 17 of the Consumer Protection Act. The restriction as to the inherent jurisdiction would not come in the way for the complainant to file the complaint, provided he fulfils the conditions mentioned in Section 17 of the Consumer Protection Act. In this view of the matter, the orders passed by the Sate Commission does not suffer from any legal infirmity and it cannot be said that there is inherent lack of jurisdiction to entertain and adjudicate the complaint filed by respondents before it.” It is evident from the order in the above batch of writ petitions, the objection raised by the applicant company came to be overruled on the ground that the remedy provided under 1986 Act is not derogation of other remedies. In the circumstances, it cannot be said that the applicant company is barred from invoking the provisions of Arbitration and Conciliation Act merely because of dismissal of the application filed under Section 8 of the Arbitration and Conciliation Act, 1996 before the Andhra Pradesh State Consumer Redressel Commission. It is the plea of the applicant company that the project came to be stalled because of the private equity investors and financial institutions resiled from their commitment to fund the project. The validity of the termination of construction agreement can be gone into by taking recourse to the provisions of the Arbitration and Conciliation Act. In that view of the matter, I find that the applicant made out a valid ground for appointment of arbitrator for resolution of the disputes that have arisen between the parties in respect of the construction agreement, dated 14-5-2009. Accordingly, the arbitration application is ordered. Sri R.Ramanujam, a retired High Court Judge, is appointed as an Arbitrator for resolution of the disputes that have arisen between the parties in respect of the construction agreement dated 14-5-2009. He can fix his own fee. No order as to costs. __________________________ B.SESHASAYANA REDDY,J rkk Dated: 4-7-2011