Petitioner seeks appointment of arbitrator to resolve the disputes pertaining to immovable property bearing bungalow Nos.170 and 171 of Diwalibaug Society, Adajaan area, Surat. It is not in dispute that the petitioner and the respondents entered into an agreement on 8th October 2010 whereby, they decided to approach the Arbitrator to resolve the dispute between the parties with respect to the said property. Despite such agreement, since the respondents filed Special Civil Suit No.543/10 with respect to same subject matter property, the petitioner moved an application Ex.13 opposing such suit in view of the arbitration agreement. Such application was allowed by the learned Additional Senior Civil Judge, Surat by order dated 10.10.2011 and the suit was stayed.
The petitioner, issued a notice through his advocate on 24.1.2011 and urged the respondents to resort to arbitration. The petitioner appointed one Hiteshbhai Hasmukhbhai Sadadiwala as his Arbitrator calling upon the respondents to nominate their arbitrator within seven days. The respondents replied to such notice vide its communication dated 29.1.11 and opposed the arbitration proceedings. The petitioner once again issued legal notice dated 18.10.11, in which the petitioner once again asserted that Shri Hiteshbhai Hasmukhbhai Sadidiwala would be his arbitrator. In response to such notice, the respondents replied by communication dated 8.11.11 and appointed one Shri Pradipkumar Parsottamdas Solapurwala as their arbitrator. The petitioner, however, objected to the same vide its letter dated 16.11.11 contending that Shri Pradipkumar Parsottamdas Solapurwala initiated civil suit against the petitioner and that he is also facing criminal case which is pending before the court of Additional Chief Judicial Magistrate. Counsel for the petitioner clarified that such criminal case has been filed by the son of the petitioner.
At that stage present petition for appointment of arbitrator has been filed. The respondents filed reply mainly contending that the petitioner's objection to Pradipkumar Solapurwala acting as an arbitrator is baseless and no prejudice is likely to be caused.
Counsel for the respondent also submitted that there is no arbitration agreement and that therefore, reference cannot be made. He relied on a decision of the Apex Court in the case of K.K.Modi v. K.N.Modi, (1998) 3 SCC 573 wherein it was observed that among the attributes which must be present for an agreement to be considered as an arbitration agreement, one of them is that the arbitration agreement must contemplate that the decision of the Tribunal will be binding on the parties to the agreement. He submitted that the arbitration envisaged under the agreement dated 8th October 2010 is not of binding nature.
Having heard the learned counsel for the parties and having perused the documents on record, I am of the opinion that the request of the petitioner for appointment of Arbitration is required to be granted. Firstly, under agreement dated 8th October 2010, the parties specifically agreed to resort to arbitration to resolve the disputes which had arisen with respect to bungalow No.170 and 171 of Diwalibaug Society. Such agreement is therefore an arbitration agreement. In fact, parties specifically agreed that disputes are required to be resolved through arbitration. Of course, it is added that if for any reason such disputes cannot be resolved through arbitration, parties keep their right to approach the court of law in tact. This is, however, not something as to suggest that arbitration which the agreement envisages, would not be of binding nature. The award that the Arbitrator may pass under such agreement would necessarily bind the parties. There is nothing stated in the agreement to make the award of the Arbitrator not binding. I am unable to accept the contention of the counsel for the respondent that the agreement is more in the nature of mediation or conciliation and not arbitration. The agreement specifically provided for arbitration for resolving the dispute with respect to the property in question. It never provided that the arbitrator's award shall not be binding.
With respect to appointment of Shri Pradipkumar Solapurwala, admittedly, there are civil and criminal proceedings in which he is involved. One of such proceedings is initiated by son of the petitioner himself. He, therefore, certainly cannot be an unbiased judge who can act as an arbitrator.
Under the circumstances, Shri C.K.Buch, Retired Judge of the High Court of Gujarat is requested to act as Sole Arbitrator to resolve the disputes between the parties under the agreement. The petition stands disposed of accordingly.
(Akil Kureshi J.) (vjn) Top