ASIAN AVENUES PVT LTD Vs. SYED SHOUKAT HUSSAIN

JUDGEMENT

(1.) The present appeal is by the defendant in a suit filed by the respondent. The respondent-plaintiff claims to be the owner of the suit property, more particularly described in the plaint. There was a Development Agreement-cum-General Power of Attorney (for short, 'the Development Agreement') executed on 23/10/2008 by and between the appellant and the respondent. By the Development Agreement, the appellant was granted permissive possession for the purposes of carrying out development work on the property subject matter of the Development Agreement. There was a dispute between the parties, which led to the respondent cancelling the Development Agreement. The respondent issued a legal notice to the appellant calling upon him to execute a deed of cancellation of the Development Agreement. The prayer in the suit is for a decree directing the appellant to execute a deed of cancellation in respect of the Development Agreement. There is also a prayer for the delivery of possession of the suit property.

(2.) After the suit summons was served, the appellant filed an application under Rule 11 of Order VII of the Code of Civil Procedure, 1908 (for short, 'CPC'). The application was filed on the ground that in view of the arbitration clause in the Development Agreement, the dispute ought to be referred to arbitration. There was a prayer made for referring the dispute to arbitration. The Trial Court rejected the plaint. The Trial Court also exercised power under Sec. 8 of the Arbitration and Conciliation Act, 1996 (for short 'the Arbitration Act'). The Trial Court directed the parties to refer their dispute to arbitration. In a revision application preferred by the respondent, the High Court has interfered and has set aside the order of the Trial Court.

(3.) The learned counsel appearing for the appellant pointed out that the High Court relied upon a decision of the Division Bench of the same Court, which holds that the adjudication on the issue whether there is a cancellation of the Development Agreement will operate in rem and therefore, the arbitration clause cannot be invoked.