Haryana

StateCommission

CC/194/2015

Vishal Setia - Complainant(s)

Versus

Unitech Lid. - Opp.Party(s)

Atul Aggarwal

15 Jul 2016

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION HARYANA, PANCHKULA

         

                                                          Application No.   :  21 of 2016

                                                          In                           

Complaint No      :  194 of 2015

Date of Institution:  10.03.2016

Date of Order      :  15.07.2016

 

1.      Vishal Setia

 

2.      Vikrant Setia

          Both sons of Sh. Satish Kumar Setia, resident of House No.1415, Street No.8, Circular Road, Abohar, District Ferozepur (Punjab).

                                      Complainants

Versus

 

1.      Unitech Limited through its Chairman/Managing Director, 6, Community Centre, Saket, New Delhi – 110017.

 

          2^nd Address

          Marketing Office, Real Estate Division (Marketing), 5^th Floor, Signatures Towers, South City-1, NH-8, Gurgaon-122001.

 

2.      Mr. Ramesh Chandra, Chairman, Unitech Limited, 6, Community Centre, Saket, New Delhi-110017.

 

3.      Mr. Ajay Chandra, Managing Director, Unitech Limited, 6, Community Centre, Saket, New Delhi-110017.

 

4.      Mr. Sanjay Chandra, Managing Director, Unitech Limited, 6, Community Centre, Saket, New Delhi-110017.

                                      Applicants-Opposite Parties

 

CORAM:             Hon’ble Mr. Justice Nawab Singh, President.

                             Shri B.M. Bedi, Judicial Member.

                                                                                                                  

Present:               Shri Atul Aggarwal, Advocate for Complainants.

                             Shri Lalit Gupta, Authorized Representative on behalf of the Opposite Parties.

 

                                                   O R D E R

 

NAWAB SINGH, J (ORAL)

 

This order shall dispose of an application moved by Unitech Limited-Opposite Parties (for short, ‘Builder’) under Section 8 read with Section 5 of the Arbitration and Conciliation Act, 1996 (for short ‘the Arbitration Act, 1996) for referring the parties to resolve the matter through arbitration in terms of Clause 13 of the Buyer’s Agreement dated November 02^nd, 2011.

2.      The complainants filed the instant complaint under Section 17 of the Consumer Protection Act, 1986 (for short, ‘Consumer Act’) with the averments that they booked a flat in the project Anthea Floors, Wildflower Country, Gurgaon of the builder by paying Rs.6.00 lacs.  The total sale consideration of the flat was Rs.58,58,382/-. In all, the complainants paid Rs.23,41,782/- to the builder.  Buyer’s Agreement- was executed between the parties on November 02^nd, 2011. 

3.      As per Clause 4.a.1 of the agreement, the possession of the flat was to be handed over to the complainants within 36 months from the date of signing the agreement, that is, November 02^nd, 2011. So, the possession was to be delivered on or before November 02^nd, 2014. A period of three months was provided as a grace period for delivery of possession. The builder failed to deliver possession of the flat within the stipulated period, the complainants sought refund of the money paid by them but the builder did not refund the same.  Thus, alleging deficiency in service and unfair trade practice on the part of the builder, the complainant filed complaint.

4.      The builder appeared and filed written version as well as application under the Arbitration Act, 1996. It was stated that the complaint was not entertainable under the Consumer Act and as per Clause 13 of the Buyer’s Agreement dated November 02^nd, 2011, the parties were to be referred to the arbitrator to resolve their disputes.  The builder denied the averments made in the complaint and prayed for dismissal of the complaint. The complainants by filing reply to the application under Section 8 of the Arbitration Act, 1996, prayed for dismissal of the same.

5.      The issue for consideration is as to whether or not the dispute can be referred to the arbitrator?

6.      Clause 13 of the Agreement is reproduced as under:-

                   “13.   ARBITRATION

13.a  All disputes, differences or disagreements arising out of, in connection with or in relation to this Agreement, shall be mutually discussed and settled between the parties.

13.b However, disputes, differences or disagreements arising out, in connection with or in relation to this Agreement, which cannot be amicably settled, shall be finally decided by arbitration in accordance with the provisions of the Arbitration and Conciliation Act, 1996. Arbitration aforesaid shall be a domestic arbitration under the Applicable Laws.

                   13.c  The venue of arbitration shall be Gurgaon or such other place as may be mutually agreed to between the parties and the Award of the Arbitrators(s) shall be rendered in English.”            

 

7.      Learned counsel for the builder has contended that after enactment of the Arbitration and Conciliation (Amendment) Act, 2015 in Section 8 of the Arbitration Act, it is mandatory for this Commission to refer the parties to arbitration.

8.      Section 8 of the Arbitration Act, 1996 is reproduced as under:-

“8. Power to refer parties to arbitration where there is an arbitration agreement.—

(1) A judicial authority before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration.

(2) The application referred to in sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof.

                   (3) Notwithstanding that an application has been made under sub-section (1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made.”

9.      After amendment of the Section in the year 2015, Section 8 reads as under:-

“8. Power to refer parties to arbitration where there is an arbitration agreement.—

(1) A judicial authority, before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party to the arbitration agreement or any person claiming through or under him, so applies not later than the date of submitting his first statement on the substance of the dispute, then, notwithstanding any judgment, decree or order of the Supreme Court or any Court, refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists.”

10.    Section 3 of the Consumer Act is relevant to adjudicate the point at issue. So, it is necessary to reproduce the provisions of Section 3 of the Consumer Act:-

“3. Act not in derogation of any other law.—The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force.”

11.    Upon reading of the Section 3 of the Consumer Act, it is clear that it provides additional remedy and existence of arbitration clause, in the agreement, to settle disputes between the parties, is not a bar to entertain a complaint filed by the consumer, alleging deficiency in service in providing services etc.  It is a remedy in addition to and not in derogation to any other remedy available to an individual.  Hon’ble Supreme Court in Skypak Couriers Ltd. v. Tata Chemicals Ltd., (2000) 5 SCC 294 held as under:-

                   “Even if there exists an arbitration clause in an 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.”

12.    In another case Trans Mediterranean Airways v. Universal Exports 2011(4) R.C.R.(Civil) 472 (SC), Hon’ble Supreme Court held as under:

                   “In our view, the protection provided under the CP Act to consumers is in addition to the remedies available under any other statute. It does not extinguish the remedies under another statute but provides an additional or alternative remedy      

13.    No doubt these authorities were rendered prior to the amendment of Section 8 of the Arbitration Act, 1996 but even then the spirit of Section 8 of Arbitration (Amendment) Act, 2015 and Section 3 of the Consumer Act is the same, that is, the remedy is in addition to and not in derogation to any other remedy available.  In a recent judgment Lt. Col. Anil Raj and Another Versus M/s Unitech Limited and another, C.C. No.346 of 2013, decided on May 02^nd, 2016 by Hon’ble Mr. Justice D.K. Jain, President, National Consumer Disputes Redressal Commission, New Delhi after considering the amendment in Section 8 of the Arbitration (Amendment) Act, 2015 held that in spite of the recent amendments in the Arbitration Act that the protection provided to the consumers under this Act is in addition to the remedies available under any other statute, including the consentient arbitration under the Arbitration Act.  It was held that the complaint filed by a consumer before the Consumer Fora would be maintainable despite there being an arbitration clause in the agreement to refer the dispute to the Arbitrator. 

14.    In view of the above, the application filed by the builder is dismissed.

 

Announced 15.07.2016

(B.M. Bedi) Judicial Member

(Nawab Singh) President

UK