AMBICA BERI vs FORUM ATMOSPHERE FLAT OWNERS ASSOCIATION

In the High Court at Calcutta
Civil Appellate Jurisdiction
Appellate Side




The Hon’ble Mr. Justice Sabyasachi Bhattacharyya
And
The Hon’ble Mr. Justice Sandip Kumar De






F.M.A.T. No. 342 of 2026
+
CAN 1 of 2026



AMBICA BERI

-Versus-

FORUM ATMOSPHERE FLAT OWNER’S ASSOCIATION



For the appellant : Mr. Rudraman Bhattacharya, Sr. Adv.,
Mr. Shuvasish Sen Gupta,
Mr. Sourojit Dasgupta,
Mr. Siddhartha Banerjee,
Mr. Souvik Ganguly,
Ms. Rajeshwari Prasad, Advs.

For the respondents : Mr. Jaydip Kar, Sr. Adv.,
Mr. Krishnaraj Thaker, Sr. Adv.,
Mr. Shaunak Mitra,
Mr. Anwar Hossain, Advs.


Heard on : 22.09.2026 & 23.09.2026

Reserved on : 23.09.2026

Judgment on : 28.09.2026

2

Sabyasachi Bhattacharyya, J.:-

1. The petitioner in an application under Section 9 of the Arbitration and
Conciliation Act, 1996 (hereinafter referred to as “the 1996 Act”) has
preferred the present appeal against the refusal to grant an ad interim
injunction sought in connection with the said application. The genesis of
the application is a notice dated August 3, 2026 issued by the respondent, a
company incorporated under Section 8 of the Companies Act, 2013 (for
short, “the 2013 Act”), being a notice of the second Annual General Meeting
(AGM) of the respondent/Association (Company) to be held on August 26,
2026.
2. In the said notice, it was alleged that the appellant, who claims to be the
owner of one of the apartments in the building complex “Forum
Atmosphere”, being Apartment No.E-101, is not a rightful or recognized
owner of the said apartment and that the appellant’s share certificate of the
respondent-Association is disputed and denied by the respondent. It was
further mentioned that the said notice of the second AGM of the respondent
was being issued for “abundant caution” and “procedural compliance” and
shall not be construed to confer or recognize any right, power, title or
interest or membership status of the appellant in respect of the property-in-
dispute.
3. The appellant issued a notice under Section 21 of the 1996 Act on August
24, 2026 for referring the matter to arbitration, flagging the disputes and
differences which have arisen between the parties in respect of the
appellant’s right as a shareholder.

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4. Consequentially, the application under Section 9 of the 1996 Act, registered
as Miscellaneous (Arb.) Case No.64 of 2026, was moved before the learned
District Judge at Alipore, District – South 24 Parganas, inter alia seeking
injunction restraining the respondent and its men and agents from
convening the proposed second AGM on August 26, 2026 without allowing
the petitioner/appellant to exercise her rights of membership, attendance
and voting therein and from giving effect or further effect to the letter dated
August 3, 2026 insofar as it restrains the petitioner/appellant from
exercising such rights.
5. Learned senior counsel for the appellant contends that the premise of the
respondent’s allegations is that the construction in which the apartment-in-
question is situated is illegal and that the share certificate of the
respondent-Company issued in the name of the appellant is disputed.
However, the Kolkata Municipal Corporation (KMC) has regularised such
construction in accordance with law, the documents relating to which were
produced before the Trial Court. Moreover, the share certificate issued in
favour of the appellant in respect of the respondent-Company was also
furnished before the learned Trial Judge.

6. It is contended that a shareholder in the company is entitled to voting rights
in respect thereof, which is borne out by Clause 50 of the Articles of
Association of the respondent-Company, which provides that each member
of the unit shall have voting rights and shall have such number of votes
which equals the number of shares held by him or her in the company.
7. Learned senior counsel points out that in terms of the arbitration clause
incorporated in the Articles, any difference or dispute arising between the
company an any of its members touching the true intent or construction of

4

the incidents or consequences of the Articles or of the statutes or anything
thereafter done, executed, omitted or suffered in pursuance of the Articles or
of the statutes or touching any breach or alleged breach or otherwise
relating to the premises or to the Articles or statutes shall be the subject-
matter of arbitration.
8. Pursuant to the said arbitration clause, arbitral proceedings have been
commenced by issuance of a notice under Section 21 of the 1996 Act at the
behest of the appellant.
9. Learned senior counsel appearing for the appellant cites Life Insurance
Corporation of India v. Escorts Ltd. and Others , reported at (1986) 1 SCC 264
and Vodafone International Holding BV v. Union of India and Another ,
reported at (2012) 6 SCC 613 , in support of the proposition that the rights of
a shareholder include the right to elect directors and to participate in the
management through them and to vote on resolutions at meetings of the
company.
10. It is argued that the learned Trial Judge overlooked the aforesaid facts and
law in refusing to grant ad interim injunction, thereby adversely affecting
the valuable rights of the appellant as a shareholder of the respondent-
Company.
11. By relying on Section 47 of the 2013 Act, learned senior counsel reiterates
the contention that every member of a company has voting right, limited
only by the shares held by such member. By relying on the Articles of
Association of the respondent-Company, it is also contended that even proxy
votes are permitted to be cast by the owners of the apartments in the
concerned building complex, who are also shareholders of the respondent-
Company (Association).

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12. Learned senior counsel appearing for the respondent, in reply, argues that,
in terms of Section 6 of the 2013 Act, the said Act has overriding effect on
the Memorandum and Articles of a company and any provision contained in
such Memorandum or Articles shall be void to the extent to which it is
repugnant to the provisions of the 2013 Act.
13. Learned senior counsel places reliance on Section 241 of the 2013 Act,
which provides for an application before the National Company Law
Tribunal (NCLT) by any person aggrieved by the affairs of the company
having been conducted in a manner prejudicial to the public interest or in a
manner prejudicial or oppressive to him or to any other member or members
or in a manner prejudicial to the interests of the company.
14. Since the nature of the present complaint pertains to the alleged conduct of
the affairs of the company in a manner prejudicial and oppressive to the
appellant, the remedy before the appellant lies in an application under
Section 241, read with Section 242, of the 2013 Act.
15. Under Section 244 of the said Act, in case of a company having a share
capital, not less than one hundred members of the company or not less than
one-tenth of the total number of its members, whichever is less, or any
member or members holding not less than one-tenth of the issued share
capital of the company, have a right to apply under Section 241. The
present appellant, thus, does not qualify to apply under the said provision,
in view of the appellant holding less than one-tenth of the issued share
capital.
16. Section 430 of the 2013 Act, it is argued, bars the jurisdiction of a Civil
Court in respect of any suit or proceeding regarding any matter which the
Tribunal or the Appellate Tribunal is empowered to determine by or under

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the 2013 Act or any law for the time being in force, as well as from granting
any injunction in respect of any action taken or to be taken in pursuance of
any power conferred by or under the 2013 Act, or any other law for the time
being in force, by the Tribunal or the Appellate Tribunal.
17. Since the arbitration clause is a part of the Articles of the respondent-
Company and the violation alleged is of the provisions of the Articles
themselves, by operation of Section 6, read with Section 430 of the 2013
Act, it is argued, it is the Tribunal which has exclusive jurisdiction to decide
such disputes. Hence, it is argued that the application under Section 9 of
the 1996 Act itself is not maintainable.
18. It is next contended that in view of the arbitration clause being a part of the
Articles of the company, which deal with the management and affairs of the
company and do not pertain to any property, any dispute as to ownership of
an apartment held in the concerned building complex is beyond the scope of
the arbitration clause. Thus, it is argued that the invocation of Section 9 of
the 1996 Act itself is without jurisdiction.
19. Learned senior counsel appearing for the respondent next refers to the
notice under Section 21 of the 1996 Act issued by the appellant and
contends that the same is restricted to the notice of the AGM of the
company, to be held on August 26, 2026. Since the said meeting has
already been held, the notice has already spent its force. It is argued that
per se , the dispute referred to in the said notice does not cover voting rights
of the appellant as a shareholder for all time to come. Hence, the
application under Section 9 of the 1996 Act, it is argued, has been rendered
infructuous.

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20. While deciding the issues involved in the present appeal, the Court is first to
look at the arbitration clause. In terms of the said clause, which is
incidentally a part of the Articles of Association of the respondent-Company,
whenever any difference or dispute arises between the company on the one
hand and any of its members on the other, touching upon the true intent or
construction or incidents or consequences of the Articles or governing
statutes or anything done, executed, omitted or suffered in pursuance of the
same or touching any breach or alleged preach or otherwise relating to the
premises or to the Articles, arises, the same shall be subject to arbitration.
21. It is trite law that an arbitration clause has to be in writing in terms of
Section 7(3) of the 1996 and, under sub-section (2) of Section 7 thereof, may
be either in the form of an arbitration clause in a contract or in the form of a
separate agreement.
22. Sub-section (1) of Section 7 defines “arbitration agreement” as an agreement
by the parties to submit to arbitration all or certain disputes which have
arisen or which may arise between them in respect of a defined legal
relationship, whether contractual or not.
23. Hence, the arbitration clause stands on a standalone footing, independent of
the other clauses of the Articles of the respondent-Company where it
incidentally finds place. Thus, the scope of the arbitration clause need not
necessarily be restricted to the alleged breach of the Articles themselves,
within the paradigm of the 2013 Act, but also extends to whatever disputes
have been mentioned therein to be included within its purview. As such, the
dispute regarding the ownership of the appellant’s apartment, being covered
by the said clause, is also a potential subject-matter of arbitration. The
arbitration clause cannot be said to governed by the 2013 Act merely

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because it is placed incidentally in the Articles of the respondent-Company,
which might otherwise operate within the matrix of the 2013 Act.
24. In the present case, the rights claimed by the appellant are on the premise
of her ownership of an apartment in the building complex over which the
respondent-Company has the charge of management, flowing from her
membership of the respondent-Company as a shareholder thereof, as well as
the appellant’s rights, including voting rights, incidental to such
shareholding. As provided in Section 47 of the 2013 Act and reiterated in
1
Life Insurance Corporation of India (supra) and Vodafone International
2
Holding BV (supra) , the right to vote for a director and to participate in the
management of the company through them, as well to vote in resolutions
taken in meetings of the company, is an integral and inalienable right
incidental to shareholding. Seen thus, the disputes, in respect of which the
application under Section 9 has been filed and the notice has been issued
under Section 21 of the 1996 Act, pertain directly to the incidents and
alleged breach of the Articles of Association of the respondent-Company.
However, the dispute is not restricted to the same but also relates to the
premises of which the appellant is an owner.

25. We find from the annexures to the application filed in connection with the
present appeal, which were also produced before the learned Trial Judge at
the time of moving the ad interim prayer of injunction under Section 9 of the
1996 Act, that by an order dated May 24, 2025, the Special Officer
(Building), KMC categorically recorded that the structural stability of the
construction of the premises-in-question was certified by an expert and

1

Life Insurance Corporation of India v. Escorts Ltd. and Others , reported at (1986) 1 SCC 264
2

Vodafone International Holding BV v. Union of India and Another , reported at (2012) 6 SCC 613

9

there was no infringement on the part of the appellant. On the premise of
the same, it was also communicated to the Officer-in-Charge of the local
police station by the Assistant Engineer (C), Building, that the illegal
construction at E-101, the apartment of the appellant, had been regularised
under Section 400(1) of the KMC Act, 1980 by the Special Officer (Building)
on May 24, 2025.
26. Thus, it is prima facie evident that the construction of the apartment-in-
question of the appellant has been regularised by the KMC, which is the
designated authority in such matters, and there cannot be any further
grievance on the ground of illegality of such construction on the part of the
respondent.
27. It is further seen from the share certificate issued in favour of the appellant
by the respondent-Company that the appellant is the owner of a share in the
Company. Thus, under Section 47 of the 2013 Act, and as per the
proposition laid down in the cited judgments referred to above, the right to
participate and vote in resolutions taken in meetings of the Company is an
integral and inextricable incident of such shareholding.
28. Even in the impugned notice dated August 3, 2026, the existence of the
share certificate has not been denied as such. The respondent merely
alleges that the said share certificate is “disputed and denied”, without
explicitly mentioning the reason(s) for such denial.
29. However, from the materials produced before the Trial Court as well as
before this Court, there cannot be any manner of doubt that a strong prima
facie case of the appellant’s shareholding in the respondent-Company as
well as ownership of the apartment-in-question, as well as the legality of the
construction of the same upon regularisation, has been prima facie

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established by the appellant. Thus, the appellant was otherwise entitled to
participate in the AGM held on August 26, 2026 as well as has the right to
participate and vote in all other meetings to be held by the respondent-
Company on the strength of her shareholding and ownership of her
apartment.
30. Insofar as the argument of the reference to arbitration and the application
under Section 9 being infructuous is concerned, the said proposition is not
sustainable, since, in the notice under Section 21 of the 1996 Act, the
appellant has flagged disputes in respect of the very rights of the appellant
as a shareholder. It is well-settled that a notice under Section 21 is not a
plaint in a suit. Thus, it would suffice if the rudiments of the disputes are
enumerated therein, even without the full particulars of the disputes being
disclosed. A notice under the said provision is a mere precursor to the main
arbitral proceeding, although the proceeding commences therefrom in law.
The entire conspectus of the disputes is only to be disclosed at a later stage,
in the statement of claim to be filed before the Arbitral Tribunal, as and
when constituted, and need not be explicitly referred to in the Section 21
notice itself.
31. The immediate trigger of the application under Section 9 was the notice
dated August 3, 2026, which was not restricted merely to the AGM to be
conducted on August 26, 2026 but struck at the very root of the ownership
of the appellant in respect of the apartment-in-question as well as the status
of the appellant as a shareholder of the respondent-Company, thus, coming
squarely within the ambit of the arbitration clause.

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32. As such, it cannot be said that the cause of action for the arbitral reference
and/or the application under Section 9 has spent its force, being much
wider and pervasive than the AGM held on August 26, 2026.
33. This issue is, thus, decided against the respondent and in favour of the
appellant.
34. The appellant harps on the purported bar under Section 6, read with
Section 430, of the 2013 Act. However, such argument, though attractive at
the first blush, is specious. Within the ecosystem contemplated in the 1996
Act, in particular Section 7 thereof, an arbitration agreement, is an
agreement in its own right, a stand-alone contract independent of the parent
agreement of which it is a part, if at all. Section 7(2) of the 1996 Act clearly
recognizes that an arbitration agreement may be either in the form of an
arbitration clause in a contract or in the form of a separate agreement.
Thus, even if the arbitration agreement is embodied in a clause of a
document, it overreaches the said document itself and partakes the
character of an independent contract, equivalent to a separate agreement.
Thus, the arbitration clause in the present case, although contained in the
Articles of Association of the respondent-Company, is not limited to the said
Articles and cannot be confined to the paradigm of the same.

35. From the arbitration clause itself, it is patent that the same covers disputes
not only regarding the terms of the Articles and their breach but also any
dispute or difference otherwise relating to the premise. Hence, the disputes
which have arisen between the parties in the present case, pertaining both
to the shareholding rights of the appellant and the legality of the
construction of the apartment/premise belonging to the appellant and her
ownership of the same, come within the ambit of the said clause.

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36. Since the arbitration clause is an independent contract of its own, it
operates beyond the purview of the Articles of Association and is not
restricted to the architecture of the 2013 Act.
37. Section 6 merely provides that the provisions of the 2013 Act shall have
overriding effect over the Articles of a company. However, since the
arbitration clause is not, per se , a provision in the Articles, although it is
incidentally contained in the Articles, but a stand-alone contract between
the parties, it does not come within the algorithm of Section 6.
38. Even otherwise, Section 430 of the 2013 Act concerns the bar to a Civil
Court, and not to arbitration. Unless, by its very nature, a dispute is not
arbitrable, for example being a dispute in rem or flowing from a specific
statute designating a particular forum, there is no bar to the arbitrability of
a dispute even if it is otherwise amenable to the jurisdiction of the Civil
Court or the Tribunal designated under the 2013 Act.
39. The dispute in the present case is not restricted to any oppression coming
within the paradigm of the 2013 Act but is of much wider ambit, extending
to ownership rights in respect of the apartment-in-question and the validity
of the share certificate of the appellant.

40. Thus, the bar under the 2013 Act is not applicable in the present case from
any perspective whatsoever.
41. Hence, this argument of the respondent is also not tenable in the eye of law.
42. In view of the above, we find that the learned Trial Judge failed to advert to
the relevant provisions of law as well as the materials produced before the
said Court in refusing ad interim injunction to the appellant despite a strong
prima facie case having been made out. Even otherwise, the balance of
convenience and inconvenience is in favour of grant of injunction, since the

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valuable rights of the appellant in respect of the apartment owned by her in
the concerned building complex as well as her right to participate and vote
in meetings of the respondent-Company is being continually infringed by the
notice dated August 3, 2026. The urgency involved is evident, since the
respondent-Company is proceeding to conduct meetings by excluding the
appellant, despite her having a prima facie valid share certificate and her
ownership of a flat in the building complex.

43. We cannot but also take note of the fact that the nature of denial to the
share certificate and ownership of the appellant is bald and without any
particulars. Moreover, the respondent tacitly acknowledged such rights by
giving a notice of the second AGM of the respondent-Company to the
appellant, which is required to be given only to members of the Company.
44. In such view of the matter, we find that the impugned order is vitiated both
in law and in fact and cannot be sustained.
45. Accordingly, F.M.A.T. No. 342 of 2026 is allowed on contest, thereby setting
aside the impugned order, bearing Order No.01 dated August 25, 2026,
passed by the learned District Judge at Alipore, District – South 24
Parganas, in Miscellaneous (Arb.) Case No.64 of 2026, and granting
injunction restraining the respondent from giving any effect or further effect
to the letter dated August 3, 2026, insofar as it restrains the appellant from
exercising her right of membership, attendance and voting in the meetings
of the respondent-Company, till disposal of Miscellaneous (Arb.) Case No.64
of 2026.
46. CAN 1 of 2026 is consequentially disposed of.
47. It is made clear that the aforesaid findings are tentative in nature and shall
not unduly influence the learned Judge taking up the application under

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Section 9 of the Arbitration and Conciliation Act, 1996 at any further stage
of the proceeding.
48. There will be no order as to costs.
49. Urgent photostat certified copies of this judgment, if applied for, be supplied
to the parties upon compliance of all formalities.


(Sabyasachi Bhattacharyya, J.)


I agree.

(Sandip Kumar De, J.)