HON'BLE MR. KAMAL DE, PRESIDING MEMBER

Order No. : 10 

Date : 07.01.2020

Complainant is present through Ld. Lawyer.

OP 1 is also present through Ld. Lawyer.

OPs 2, 3, 4, 5,6 and 7 take no step. None also appears on their behalf.

IA/22/2019 is taken up for hearing.

Heard Ld. Lawyer for both sides. Considered.

The instant IA Case relates to a petition U/S. 5 of Arbitration and Conciliation Act, 1996 filed by the OP 1.

In filing the instant IA under disposal it is alleged by OP 1 that the present case/complaint petition is not maintainable in law and the only remedy, if any, lies for the complainant to invoke the arbitral proceeding for determination of dispute through arbitral tribunal in view of the clear, categorical existence of Arbitral Agreement between the complaint and the OP party vide clause/condition No. 15 of the Agreement of Sale dated 07.10.2015 i.e. annexure A of the complainant petition. It is also stated that as the subject matter of dispute is purely arbitral and needs to be decided and determined through arbitration proceeding by arbitral tribunal U/S. 5 of the Arbitration and Conciliation Act, 1996 and the present complaint petition ought to be filed in the form of reference of dispute to the arbitral tribunal as per relief provision of Arbitration and Conciliation Act, 1996.

It is also stated that no judicial intervention by Hon’ble State Commission is lawful and permission U/S. 5 of the Arbitration and Conciliation Act, 1996 and the dispute between the parties ought to be decided by the arbitrator as per the Arbitration Agreement.

Complainant files written objection contending, inter-alia that the petition is not maintainable and is filed with motivated purpose to achieve illegal gain and the petition is misleading. It is stated that from the very beginning of entering into Agreement for Sale with the OPs, the OPs paid entire consideration price and the OPs in spite of receiving of the consideration price pressurised the complainant to pay more money than the agreed consideration and had practised unfair trade practice. The OPs have also paid money towards stamp duty and registration fees. But the OPs cheated the complainant and delivered the schedule flat absolutely unfit for human accommodation. It is stated that the arbitration clause has nothing to do with the execution and registration of the Sale Deed. The complainant has prayed for dismissal of the petition.

We find that the complainant has filed this case against the OPs for failure by the OPs to complete and/or rectify the defect of construction of the said flat and also for deficiency in service and alleged unfair trade practices.

The moot question arose for consideration as to whether in view of the arbitration clause a consumer forum is at the behest of the developer is bound to refer the dispute to arbitral tribunal in spite of pendency of a consumer dispute.

In fact this question came up for consideration before the Hon’ble National Commission for consideration and opinion – ‘whether the consumer fora constituted under the Consumer Protection Act, 1986 are bound to refer the dispute raised in the complaint once an application U/S. 8 of the Arbitration and Conciliation Act, 1996 is filed by the opposite party (parties) seeking reference of the dispute to an arbitral proceeding in terms of valid arbitration agreement, despite the provision of Sec. 3 of the Consumer Protection Act 1986’. In answering the question, the Hon’ble National Commission after following views taken by the Hon’ble Supreme Court in a catena of judgement and in particular “National Seeds Corporation Limited VS Madhusudan Reddy Case 2012 (2) SCC 506 has concluded consumer forum constituted under the Consumer Protection Act, 1986 are not bound to refer the dispute raised in the complaint on an application filed U/S. 8 of Arbitration and Conciliation Act, 1996 seeking reference of the dispute to an arbitral tribunal in terms of the valid clause in the agreement entered into between the parties. The decision of the Hon’ble Apex Court clearly indicates that the decision in the case on Rosedale Developer’s Case (Supra) was considered. In the decisions reported in 2010 (6) SCALE 294 (Om Prakash Shiny VS. DCM and ors.) (2011) 13 SCALE 584 (Nivedita Sharma VS Shellular Operators Association of India and Ors.), the Hon’ble Apex Court has held that that remedy available to an aggrieved person U/S. 21 of the Act is an effective alternative remedy. In view of the proposition laid down by the Hon’ble Supreme Court in Rosedale Developer’s Case (Supra), the consumer for a is not bound to make a reference to the arbitral tribunal.

Existence of arbitration clause in agreement will not be a bar to the entertainment of a complaint by a consumer relating to deficiency in service and in this regard, we are fortified by the ruling reported in 2000 CTJ 321 Supreme Court (Skypark Careers Limited VS Tata Chemical Limited).

We are also fortified by the decision of the Supreme Court of India in review Petition (C) Nos. 2629 – 2630 of 2018 (M/S. Emaar MGF Land Limited VS AFTAB Singh).

We are convinced to hold that the complaint case filed before this Commission is for deficiency in service. OP did not refer the dispute to the arbitrator till this date. So, it is proved that OP has no desire to give relief because Arbitrator is within the gloves of the OPs. No original arbitration agreement or a certified copy thereof is also filed by the OPO – developer before this Commission.

Moreover, Sec. 34 of the Arbitration Act has not applicable to the proceeding before Consumer Forum and in this regard, ruling reported in 1993 (3) CPR 29 is applicable. At the same time, the forum has full authority and jurisdiction to give relief in respect of  the claim for deficiency-in-service as per C.P. Act and U/Sec. 3 of C.P. Act and Section 3 of C.P. Act is not derogation of the Arbitration Act and to that effect ruling reported in 1994 (CPR) 48 is relied.

After giving due consideration to the submission advanced by the Ld. Advocates appearing for the parties, we find no merit in the petition under disposal. On the contrary after entering appearance the OPs – developer/OPs should have filed written version within 45 days from the date of receipt of summons but they did not do so. In view of the decision of 3 Judges Bench of the Hon’ble Supreme Court reported in 2016 (1) Supreme 319 (New India Assurance Company Limited VS Hilly Multipurpose Limited) a maximum time 45 days only is permissible for filing the written version. Following at the reference judgements of the Apex Court the OPs cannot be allowed to file their written version if a time of 45 days is lapsed since the date of service of notice.

It appears that OPs did not file written version within stipulated period.

Consequently, we feel inclined to fix 05.02.2020 for ex-parte hearing of the case.

The instant IA Case is thus disposed of accordingly