SUNIL MANCHANDA Vs. ANSAL HOUSING AND CONSTRUCTION LTD

JUDGEMENT

(1.) This is a petition under Section 11 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the Act) read with the Scheme for Appointment of Arbitrators, 1996 seeking appointment of a retired Judge of the Supreme Court of India as a sole arbitrator to adjudicate upon the dispute and differences between the parties.

(2.) The petition has been filed on behalf of six petitioners namely Mr. Sunil Manchanda, M/s. Puri Construction Ltd., M/s Florentine Estates of India Ltd., M/s Mad Entertainment Network Ltd., Mr. Arjun Puri and Mr. Mohinder Puri with the averments and allegations that the petitioners acting upon the representations of the Ansal Brothers of the respondent M/s Ansal Housing and Construction Ltd. entered into an agreement 'Development Agreement' on 14.10.2000 in regard to the development of approximately 19 acres of land in Sector 53, Gurgaon. Clause 51 of the agreement contains an arbitration agreement, which reads as under:

(3.) The said Agreement is subject to the jurisdiction of the Delhi Courts and the disputes and differences arising out of or in connection with the said agreement are liable to be referred to a retired Judge of the Supreme Court of India for settlement. It is alleged that disputes and differences have arisen between the parties as the respondent repudiated his obligation to take up the work of construction and consequently the petitioner determined / rescinded the contract for development dated 14.10.2000 by a registered notice dated 07.6.2004, It is further alleged that the respondent has refused to perform and has further disabled himself from performing his promises in their entirety consequent to which the petitioners have put to an end to the contract and claimed damages from the respondent. On the other hand, the respondent has claimed damages from the petitioner and in addition claimed specific performance of the contract dated 14.10.2000 which he is not entitled to in view of the provisions of Sections 14(i)(a) and 14(i)(b) & (d) of the Specific Relief Act. The petitioner invoked the arbitration agreement by a registered notice dated 07.6.2004 and called upon the respondent to select a retired Judge of the Supreme Court of India to act as the Arbitral tribunal to adjudicate upon the disputes between the parties. The respondent in their letter dated 03,7.2004 acknowledged the receipt of the two notices sent by the petitioner for invoking the arbitration agreement and for appointment of a sole arbitrator and sought to set up a case that the contract dated 14.10.2000 created an interest in immovable property and started representing itself to be the owner in possession of the land. It is also alleged that the respondent has acted in fraud and has committed acts of variance and in subversion of the relationship intended by the contract. The petitioners have set out in detail the acts of commission and omission committed by the respondent in relation to the development agreement and it is not necessary to refer to each of them in this order. By a letter dated 07.10.2003 the petitioner called upon the respondent, inter alia, as under: "