This order is arising out the MA being no. 29/2022 filed by the OPs in the CC 40/2021 challenging maintainability of this complaint.

It is stated by the OPs in the application that the petition of complaint has been filed by the Complainant against the OPs under Section 35 of the Consumer Protection Act, 2019 seeking for several prayer.

The relation and transaction arose by and between the Complainant and OPs relating to the property of the Complainant by virtue of the development agreement executed by the Complainant as the owner and the OPs as the developers on 25.07.2016. The said development agreement has been registered before the ADSR, Cossipore, Dumdum. The Complainant being the owner of the property prior to entering into the joint venture agreement i.e. development agreement was the owner and the OPs are the developer. The developer has already paid to the owner as sum of Rs. 30,00,000/- as per the registered development agreement dated 25.07.2016, but the Complainant is denying the same. Separate agreement was executed by and between the parties to sale out the owner’s allocation measuring about 500 square feet on the ground floor against Rs. 11,00,000/- and the Complainant executed registered general power of attorney in favour of the OP 2 and 3 regarding to sale out the allocation to any third party and the Complainant has received the entire consideration money. As the Complainant is denying the same the dispute is required to be solved by an arbitrator. The Complainant has relied on the development agreement and prays relief in terms of the prayer suppressing the real fact and affairs of the project under agreement. There are certain terms and conditions have been stipulated specifically in the clause 26 of the said agreement wherein it is mentioned that this Ld. Commission has no authority of entertain and adjudicate the instant complaint. Rather the dispute should be resolved under Arbitration and Conciliation Act, 1996. Therefore an arbitrator should be appointed whose opinion will be final. The remedy of the Complainant is only lying before the Arbitral Tribunal/or before the Ld. District Judge as per the Provision of  Arbitration and Conciliation Act, 1996. Prayer is made by the OP 1 to 3 for dismissal of this complaint on this score alone.

The abovementioned application has been contested by the Complainant by filing written objection stating that inspite of Arbitral Clause in the development agreement, this Ld. Commission has ample scope to adjudicate the instant dispute of the Complainant in view of several land mark Judgments passed by the Hon’ble Supreme Court as well as the Hon’ble NCDRC. The Complainant has referred to the decision of the Hon’ble Supreme Court in the case of Emaar MGF Land Ltd. Vs. Aftab Singh reported in Volume I (2015) CPJ 5 (SC) wherein it has been laid down that the Arbitration Clause in the agreement does not bar the jurisdiction of the Consumer Fora/ Commission to entertain the complaint. According to the Complainant the MA as filed by the OPs is liable to be dismissed with exemplary cost.

We have carefully perused the content of the MA and objection thereto and heard argument at length advanced by the Ld. Counsel for the parties. At the very outset it is pertinent to mentioned that though the Complainant has mentioned that citation in the written objection, but the copy of the said Judgment has not been placed before this Ld. Bench. It is seen by us that the crux of the present application revolves within a very short compass as to whether the complaint petition is maintainable or not on the groud of existence of Arbitral Clause in the development agreement.

In this respect we are to mention to the judgment of Kishore Lal vs. Chairman, Employees’ State Insurance Corporation (2007) 4 SCC 579, where the Hon’ble Supreme Court has held that-

‘The trend of the decisions of this court is that the jurisdiction of the Consumer Forum should not and would not be curtailed unless there is an express provision prohibiting the Consumer Forum to take up the matter which falls within the jurisdiction of Civil Court or any other forum as established under some enactment. The Court had gone to the extent of saying that if two different for a have jurisdiction to entertain the dispute in regard to the same subject, the jurisdiction of the Consumer Forum would not be barred and the power of the Consumer Forum to adjudicate upon the dispute could not be negated.’

In the case of Fair Air Engineers (P) Ltd vs. N.K. Modi (1996) 6 SCC 385 The Hon’ble Supreme court after taking into consideration the provisions of the Consumer Protection Act, 1986, the Arbitration Act of 1996 and the Arbitration Act, 1940 held as under:

“The provisions of the Act are to be construed widely to give effect to the object and purpose of the Act. It is seen that section 3 envisages that the provisions of the Act are in addition to and are not in derogation of any other law in force. It is true that the words ‘in derogation of the provisions of any other law for the time being in force’ would be given proper meaning and effect and if the complaint is not stayed and the parties are not relegated to the arbitration, the Act purports to operate in derogation of the provisions of the Arbitration Act. Prima facie, the contention appears to be plausible but on construction and conspectus of the provisions of the Act we think that the contention is not well founded. Parliament is aware of the provisions of the Arbitration Act and the Contract Act, 1872 and the consequential remedy available under Section 9 of the Code of Civil Procedure i.e. to avail of right of civil action in a competent court of civil jurisdiction. Nonetheless, the Act provides the additional remedy.

It would, therefore, be clear that the legislature intended to provide a remedy in addition to the consentient arbitration which could be enforced under the Arbitration Act or the civil action in a suit under the provisions of the Code of Civil Procedure. Thereby, as seen, section 34 of the act does not confer an automatic right nor create an automatic embargo on the exercise of the power by the judicial authority under the Act. It is a matter of discretion. Considered from this perspective, we hold that though the District Forum, State Commission and national commission are judicial authorities, for the purpose of section 34 of the arbitration act, in view of the object of the Act and by operation of section 3 thereof, we are of the considered view that it would be appropriate that these forums created under the Act are at liberty to proceed with the matters in accordance with the provisions of the act rather than relegating the parties to an arbitration proceedings pursuant to a contract entered into between the parties. The reason is that the Act intends to relieve the consumers of the cumbersome arbitration proceedings or civil action unless the forums on their own and on the peculiar facts and circumstances of a particular case, come to the conclusion that the appropriate forum for adjudication of the disputes would be otherwise those given in the Act.”

In Skypak Couriers Limited vs. Tata Chemicals limited (2000) 5 SCC 294) the Hon’ble Supreme Court has again in the context Arbitration Act, 1940 observed as under:-

“Even if there exists an arbitration clause in a n agreement and a complaint is made by the consumer, in relation to a certain deficiency of service, then the existence of an arbitration clause will not be a bar to the entertainment of the complaint by the Redressal agency, constituted under the Consumer Protection act, since the remedy provided under the act is in addition to the provisions of any other law for the time being in force.”

In the paragraph no-66 of the Madhusudhan Reddy’s case (supra) the Hon’ble Supreme Court has held that-

66. “The remedy of arbitration is not the only remedy available to a grower. Rather, it is an optional remedy. He can either seek reference to an arbitrator or file a complaint under the Consumer Act. If the grower opts for the remedy of arbitration, then it may be possible to say that he cannot, subsequently, file complaint under the Consumer act. However, if he chooses to file a complaint in the first instance before the competent Consumer forum, then he cannot be denied relief by invoking section 8 of the arbitration and Conciliation Act, 1996. Moreover, the plain language of section 3 of the Consumer act makes it clear that the remedy available in that act is in addition to and not in derogation of the provisions of any other law for the time being in force.”

Very recently the Hon’ble National Commission has passed one judgment on 13.05.2013 in the Revision Petition no-412/2011 in a case of DLF Limited vs. Mridul estate private Limited, based on the abovementioned judgment, wherein it has been held that Consumer Forums constituted under the C.P. Act are not bound to refer the dispute to the arbitrator in view of the arbitration clause mentioned in any document of the OP. 

In view of the abovementioned judgments of the Hon’ble Supreme Court as well as the National Commission we are of the view that in the case in hand though there exits one Arbitration Clause in the terms and the conditions of the questioned policy, this case is very well maintainable before the Consumer Forum in view of the Section-3 of the Consumer Protection  Act, 1986/2019.

Going by the foregoing discussions, hence, it is ordered that the MA being no. 29/2022 is dismissed on contest without any cost.

Be it mentioned that today evidence on affidavit is filed by the Ld. Advocate of the Complainant with copy to the other side. As such, 20.04.2022 is fixed for filing questionnaire by the OP touching upon the evidence of the Complainant.

Let plain copy of this judgment be given to the parties free of cost as per the CPR.

Dictated and corrected by

[HON'BLE MRS. Silpi Majumder]
MEMBER