Polestar Realtors Private Limited vs Rachana Co Operative Housing Society Limited

CNR No : HCBM020154682026

arbpl15468-2026-J.doc
AGK
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
ARBITRATION PETITION (L) NO.15468 OF 2026
Polestar Realtors Private Limited … petitioner
Vs.
1. Rachana Coop. Housing Society Ltd.
2. Ramanand Rai Sharma
3. Hari Sewak Rai Sharma
4. Alok Kumar Rai Sharma
ATUL
GANESH
KULKARNI
5. Kalindi Rai
6. Ashok Rai
Digitally signed
by ATUL
GANESH
KULKARNI
Date: 2026.07.17
14:05:30 +0530
7. Divya Rai
8. Cynthia Burroghs
9. Ashley Burroughs
10. Rishikesh Kanegaonkar
11. Arvind B. Kanegaonkar
12. Shubhada Vaze
13. Kapol Vidyanidhi Trust
14. Kanchan Rochlaney
15. Sharad Rochlani
16. Musaddique Shaikh
17. Dr. Anil Dixit
18. Dr. Rajesh Kumar
19. Jivesh Developers & Properties Pvt. Ltd.
20. Samshiba Properties Private Limited
21. Shivsagar Properties Private Limited
22. Shibani Properties Private Limited
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23. Moonrise Properties Private Limited
24. Samir Bhojwani
25. Jivesh Bhojwani
26. Monica Jaisinghani
… respondents
WITH
INTERIM APPLICATION (L) NO.23252 OF 2026
IN
ARBITRATION PETITION (L) NO.15468 OF 2026
M/s. Saboo and Varun … Applicant
In the matter between
Polestar Realtors Private Limited … Petitioner
Vs.
Rachana Cooperative Housing
Society Limited & Others … Respondents
Mr. Mustafa Doctor, Senior Advocate with Nitya Parikh,
Kinnar Shah, Aditi Bhargava & Tejasvati Singh i/by Divya
Shah & Associates for the petitioner.
Mr. Zubin Benramkamdin, Senior Advocate with Akshay
R. Pai, Avadhut V. Patil, Suryajeet Ravrane, Omkar
Ravrane, & Harshwardhan Gaikwad i/by Siddhi Bhosale
for respondent No.1.
Mr. Surya Das for respondent No.2.
Ms. Prachi Tatake, for respondent Nos.8, 10, 11, 12, &
17.
Mr. Bharat Choudhari with Abinash Pradhan, Garima
Agrawal & Yash Dedhia i/by Wadia Ghandy & Co., for
respondent No.13.
Mr. UditKumar Gupta for respondent Nos.14 & 15.
Ms. Masira Shaikh i/by Trilegal for respondent No.16.
Mr. Girish Godbole, Senior Advocate with Sachin S.
Rawool for respondent No.19.
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Mr. Sachin S. Rawool for respondent Nos.20, 22, & 23.
Mr. Shailendra Kanetkar with Sachin S. Rawool for
respondent No.21.
Mr. Zal Andhyarujina, Senior Advocate with Parimal K.
Shroff, D.V. Deokar, Sachin Pandey, & D. Parikh i/by
Parimal K. Shroff & Co., for respondent Nos.24 & 25.
Mr. Mayur Khandeparkar with Sachin S. Rawool for
respondent No.26.
Mr. S.U. Kamdar, Senior Advocate i/by Shubham Sawant
for the applicant in IAL/23252/2026.
CORAM : AMIT BORKAR, J.
RESERVED ON : JULY 10, 2026.
PRONOUNCED ON : JULY 17, 2026
JUDGMENT:
1. The present petition is filed under Section 9 of the
Arbitration and Conciliation Act, 1996. By this petition, the
petitioner is asking for temporary relief till the disputes are
referred to and decided by an Arbitral Tribunal. According to the
petitioner, respondent Nos.2 to 26 are not handing over possession
of their respective flats and are creating obstruction in the
redevelopment work. Therefore, the petitioner has requested this
Court to direct those respondents to vacate their flats and
cooperate in the redevelopment. In the alternative, the petitioner
has also prayed for appointment of a Court Receiver to take
possession of the flats and hand over the same to the petitioner so
that the redevelopment work can proceed without any hindrance.
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2. According to the petitioner, the facts leading to the present
petition are as follows. The petitioner claims to be the owner of
the property known as Rachana Plots. Under a registered Lease
Deed dated 10 July 1960, the predecessors of the petitioner leased
the land admeasuring about 5000 square yards, equivalent to
about 4145.8 square metres, comprising CTS Nos. C-40, C-49, C-
50, C-51, C-52, C-53 and C-54 of Village Bandra, then known as
Danda, to respondent No.1 Society for a period of 99 years. Since
then, respondent No.1 Society has been holding the property as a
lessee under the said Lease Deed. It is further stated that on 7
November 1981, the Society entered into a Development
Agreement with M/s. Saboo and Varun. According to the
petitioner, this agreement was contrary to the terms and conditions
of the Lease Deed. Later, on 22 May 2014, the petitioner filed T.E.
and R. Suit No.177/192 of 2014 before the Small Causes Court
seeking eviction of the members of the Society. During the
pendency of the said suit, the petitioner made an offer to the
Society on 22 December 2016 for redevelopment of the property.
Thereafter, a Special General Body Meeting of the Society was held
on 8 January 2017. In that meeting, the members accepted the
petitioner's offer for redevelopment. Subsequently, on 20 January
2017, consent terms were executed between the petitioner and the
Society. In view of the settlement arrived at between the parties,
the suit came to be disposed of by a consent decree dated 7 March
2017.
3. It is the petitioner's case that the proposed Development
Agreement was approved by the Society in its Special General
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Body Meeting held on 16 December 2022. Thereafter, the
Development Agreement was formally executed between the
petitioner and the Society on 26 December 2023. During the
period between 2023 and 2025, five more members also executed
supplemental development agreements in favour of the petitioner.
The petitioner further entered into another Development
Agreement on 10 January 2025 with Meena Society in respect of
adjoining land admeasuring 1428.30 square metres bearing CTS
Nos. C/15, C/16 and C/17, Old Survey No.164/A and Plot No.82
of Village Bandra. According to the petitioner, both the Rachana
Plots and Meena Plots are being jointly redeveloped under
Regulations 33(10) read with 33(11) of the Development Control
and Promotion Regulations, 2034. For carrying out the
redevelopment, the petitioner obtained Intimation of Approval
from the Slum Rehabilitation Authority on 4 February 2026 and 16
February 2026. After receiving those approvals, the petitioner
issued a notice dated 20 February 2026 calling upon the Society
and its members to vacate their flats and hand over possession
within a period of 45 days. The petitioner further states that by a
letter dated 14 April 2026, the Society informed that declarations
of consent had been received from 37 members. Thereafter,
between 15 April 2026 and 17 April 2026, the petitioner's
advocates issued three separate notices to the remaining 26
members, giving them one final opportunity to vacate the premises
and hand over possession. According to the petitioner, respondent
Nos.2 to 26 did not comply with those notices or perform their
obligations. It is because of this continued refusal that the present
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arbitration petition has been filed.
4. Learned Senior Advocate Mr. Doctor, appearing for the
petitioner, submitted that the petitioner and respondent No.1
Society have executed a Development Agreement dated 26
December 2023. He submitted that the agreement contains an
arbitration clause and disputes have now arisen between the
parties under that agreement. Since the disputes are required to be
referred to arbitration, the present petition under Section 9 of the
Arbitration and Conciliation Act has been filed seeking interim
protection against respondent Nos.2 to 26 till the disputes are
decided by the Arbitral Tribunal. Learned Senior Counsel further
submitted that under the Development Agreement, the petitioner
is described as the Owner and Developer, while respondent No.1 is
the Co-operative Housing Society. Respondent Nos.2 to 26 are
members of the Society. According to him, these members have
acted in breach of the Development Agreement, particularly
Clauses 15.2 and 15.3, by refusing to vacate and hand over
possession of their respective flats. It was submitted that unless
possession is handed over, the petitioner cannot begin the
redevelopment work contemplated under the agreement.
Therefore, the petitioner seeks directions against respondent Nos.2
to 26 to vacate their flats pending reference of the disputes to
arbitration. It was further submitted that the petitioner is the
owner of the land situated at Bandra, which has been leased to
respondent No.1 Society. At present, two buildings stand on the
said land and the members of the Society are residing in those
buildings. According to the petitioner, in the Special General Body
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Meeting held on 8 January 2017, the Society passed a resolution
appointing the petitioner as the developer for redevelopment of
the property. Learned Senior Counsel submitted that on or about
10 December 2022, the General Body of the Society approved the
Development Agreement proposed to be entered into between the
petitioner and the Society. According to him, under the terms of
that agreement, the petitioner was given the right to undertake
and complete the redevelopment project in the manner considered
appropriate by the petitioner, subject to the terms contained in the
agreement. It was further submitted that after obtaining the
Intimation of Approval from the Slum Rehabilitation Authority on
4 February 2026 and 16 February 2026, the petitioner became
entitled to commence redevelopment. Accordingly, a notice dated
20 February 2026 was issued to the Society under Clause 15.2 of
the Development Agreement calling upon the members to vacate
their flats. Along with the notice, the petitioner also forwarded a
draft declaration for consenting members to execute. Learned
Senior Counsel further pointed out that thereafter the Society
informed the petitioner that a Special General Body Meeting
would be held on 26 February 2026. The purpose of the meeting
was to discuss the members' queries regarding the Letter of Intent
and Intimation of Approval obtained by the petitioner and also to
consider revision of commercial terms such as transit rent and
hardship compensation. According to the petitioner, at that
meeting the members approved the Letter of Intent and Intimation
of Approval issued by the Slum Rehabilitation Authority. It was
also resolved that the monthly transit rent would be increased
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from Rs.125 per square foot to Rs.162 per square foot. The
minutes of the said meeting were produced before this Court
during the hearing held on 10 July 2026.
5. It was further submitted that by a letter dated 14 April 2026,
the Society informed the petitioner that declarations of consent
had been received from 37 members. Thereafter, five more
members also submitted their declarations. Thus, according to the
petitioner, when the present petition came to be filed, 42 out of 63
members had already given their consent after issuance of the
Intimation of Approval. The petitioner contends that only the
remaining 26 members are refusing to vacate their flats and are
thereby preventing the redevelopment work from proceeding. It is
on this basis that the present petition has been filed. By way of the
present petition, the petitioner has sought several interim reliefs
pending commencement and completion of the arbitration
proceedings. The petitioner has prayed that respondent Nos.2 to
26 should be directed to vacate the specified flats in the existing
Rachana Buildings and cooperate in the redevelopment of the
Rachana and Meena Plots. The petitioner has also prayed for
appointment of the Court Receiver with authority to take physical
possession of the said flats, if necessary with police assistance and
by breaking open locks, and thereafter hand over possession to the
petitioner for demolition and redevelopment. The petitioner has
further sought permission for the Court Receiver to execute and
register the Permanent Alternate Accommodation Agreements on
behalf of the disputing members, permission to deposit transit
rent, hardship compensation and other monetary benefits with the
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Court Receiver, and permission to hand over possession of the
newly constructed flats to the Court Receiver. Lastly, the petitioner
has sought an injunction restraining respondent Nos.2 to 26 and
persons claiming through them from creating any third party
rights, transferring or encumbering the existing or proposed flats,
or in any manner obstructing or interfering with the
redevelopment of the Rachana Plots and Meena Plots.
6. Learned Senior Advocate Mr. Doctor, while replying to the
objections raised by respondent Nos.19 to 26, submitted that these
respondents are not only members of the Society but are also
family members of respondent No.24 or are companies and entities
owned and controlled by respondent No.25, who is the son of
respondent No.24. He submitted that respondent No.24 was
earlier appointed by the Society as the developer for
redevelopment of the property. However, the Society terminated
that Development Agreement on 27 October 2015. Though
respondent No.24 challenged the termination by filing Commercial
Suit No.409 of 2017 before this Court, no interim order restraining
the Society or protecting respondent No.24 has been granted in
that suit. Learned Senior Counsel submitted that the main
objection raised by respondent Nos.19 to 26 is that the
redevelopment now being carried out is different from what was
originally contemplated in the Development Agreement. According
to those respondents, the project was initially expected to proceed
on the basis of an Intimation of Disapproval issued by the
Municipal Corporation, but the petitioner has instead obtained an
Intimation of Approval from the Slum Rehabilitation Authority
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under Regulation 33(11) of the Development Control and
Promotion Regulations, 2034. They have also alleged that the
petitioner has wrongly included the neighbouring plot in the
redevelopment though such course is not permitted under the
Development Agreement. In reply, learned Senior Counsel
submitted that these objections are completely incorrect and
without any basis. According to him, the Development Agreement
itself clearly shows that the Society knowingly appointed the
petitioner as the Owner and Developer and agreed that the
petitioner would be free to complete the project in the manner
considered appropriate. He submitted that the agreement
specifically permits the petitioner to take benefit of any
Government scheme available under law, provided the
redevelopment is carried out in accordance with the Development
Control and Promotion Regulations, 2034. It was further submitted
that the agreement also permits the petitioner to use every legally
available FSI benefit, amalgamate neighbouring plots, and modify
or revise the plans, so long as the area of the flats to be given to
the members remains unaffected. Learned Senior Counsel invited
attention to various recitals and clauses of the Development
Agreement. According to him, those provisions recognise the
petitioner as the owner and developer of the property and confer
wide rights to utilise the entire development potential available
under law. The agreement also permits the petitioner to avail
additional FSI, TDR and other development benefits, including
those arising from amalgamation of adjoining plots. It further
authorises the petitioner to undertake and complete the
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redevelopment in the manner considered appropriate, amend
layouts and plans subject to protection of the members' carpet
area, choose beneficial Government schemes, utilise the
development rights after approval, demolish the existing
structures, and carry out the redevelopment in accordance with
the sanctioned plans and permissions. On the strength of these
provisions, it was submitted that the present redevelopment is fully
supported by the terms of the Development Agreement. Learned
Senior Counsel therefore submitted that the allegation that the
redevelopment is being carried out contrary to the approval
granted by the Society is, on the face of the record, incorrect.
According to him, this objection has been raised only as an
afterthought. He submitted that none of the affidavits filed by the
contesting respondents explains how the present redevelopment
would prejudice or adversely affect them. According to the
petitioner, these submissions were made only during oral
arguments without any proper factual foundation. Learned Senior
Counsel further submitted that the conduct of the respondents
itself shows that this objection was never raised earlier. After
obtaining the Intimation of Approval, the petitioner circulated the
same to the Society by its letter dated 20 February 2026, and the
Society in turn circulated it among all its members. At that stage,
no member raised any objection regarding the nature of the
redevelopment. On the contrary, after seeing the Intimation of
Approval and the proposed scheme, 42 out of the 63 members
executed their declarations of consent. He also pointed out that
during the hearing held on 10 July 2026, the Society produced the
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resolution passed in the General Body Meeting dated 26 February
2026 approving the proposal. It was therefore submitted that the
objections now raised by respondent Nos.19 to 26 are without
substance.
7. Learned Senior Counsel then dealt with the objections raised
by respondent Nos.19 and 21. He submitted that these
respondents have claimed ownership over certain additional flats
which, according to them, should also be treated as part of the
redevelopment project. In reply, learned Senior Counsel submitted
that these so called flats are vacant units measuring about 100
square feet each. According to the petitioner, the Society itself has
never recognised respondent Nos.19 and 21 as owners of those
premises. He submitted that the dispute regarding ownership or
membership in respect of those units is purely an internal dispute
between the Society and the persons claiming rights over them.
Such dispute relates to membership of the Society and is not the
subject matter of the present proceedings under Section 9. It was
further submitted that the possession of those units is presently
with the Society and that the Development Agreement itself
provides that disputes concerning such waitlisted members are to
be dealt with by the Society at its own cost.
8. Learned Senior Counsel next referred to the objections raised
by respondent Nos.14 and 15. He submitted that these
respondents, besides being members of the Society, were earlier
shareholders of the petitioner company. According to them, the
Development Agreement is void from the very beginning because
disputes relating to the shareholders' agreement are pending
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before the competent Court. In answer to those objections, learned
Senior Counsel submitted that the disputes between the present
shareholders of the petitioner company and respondent Nos.14
and 15, who claim rights as former shareholders, have no
connection with the present redevelopment or with the
Development Agreement executed with the Society. According to
him, those disputes fall entirely outside the arbitration agreement
contained in the Development Agreement. He also pointed out that
respondent Nos.14 and 15 have not obtained any interim order in
the proceedings filed by them concerning the ownership or
shareholding of the petitioner company.
9. Learned Senior Counsel thereafter dealt with the objections
raised by respondent Nos.8, 10, 11, 12 and 17. He submitted that
these respondents have relied upon proceedings filed before the
Cooperative Court challenging the resolutions of the Society and
the authority of the Managing Committee to approve the
Development Agreement. In reply, learned Senior Counsel
submitted that those proceedings were filed before the Cooperative
Court only on 18 May 2026, whereas the present petition had
already been filed on 28 April 2026. According to him, the timing
itself shows that the proceedings before the Cooperative Court are
only an afterthought and a reaction to the present petition. He
further submitted that these respondents have not challenged the
earlier General Body Resolution dated 8 January 2017 by which
the petitioner was appointed as the developer and its proposal for
redevelopment was accepted. It was also submitted that issues
relating to the internal management of the Society will be decided
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by the Cooperative Court in due course, and till today those
respondents have not obtained any order restraining the Managing
Committee from acting under the Development Agreement.
10. Learned Senior Counsel then referred to the objection raised
by respondent No.13. According to respondent No.13, the
members could not be asked to vacate their flats unless Permanent
Alternate Accommodation Agreements had first been executed in
their favour. In reply, learned Senior Counsel submitted that the
petitioner has already stated in paragraph 15 of the rejoinder
affidavit that it is ready and willing to execute Permanent
Alternate Accommodation Agreements with every member on or
before the respective member vacates the premises, provided the
members cooperate in the process. According to the petitioner,
those agreements could not be executed earlier because the
Society had not finalised the allotment of the new flats and the
members themselves were not cooperating. He further pointed out
that the advocate appearing for respondent No.1 Society informed
the Court that a notice dated 7 July 2026 had already been issued
convening a Special General Body Meeting on 12 July 2026 for
approving the draft Permanent Alternate Accommodation
Agreements and finalising the allotment of new flats. Copies of the
draft agreements had also been circulated to all the members
along with the notice.
11. On the basis of all these circumstances, learned Senior
Counsel submitted that the objections raised by the contesting
respondents are, on the face of the record, frivolous and many of
them fall outside the scope of proceedings under Section 9 of the
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Arbitration and Conciliation Act. He further submitted that it is a
settled principle in matters relating to redevelopment that the
decision of the majority of the members ordinarily prevails.
According to him, the majority of the members have already
approved the Development Agreement, accepted the
redevelopment proposed under the Intimations of Approval dated
4 February 2026 and 16 February 2026, and are willing to proceed
with the project. It was therefore submitted that, in the interest of
justice, the interim reliefs prayed for by the petitioner deserve to
be granted.
12. Learned Senior Advocate Mr. Benramkamdin, appearing for
respondent No.1 Society, submitted that under the Development
Agreement, the petitioner was given full authority to redevelop the
property under any scheme permitted by the Development Control
and Promotion Regulations, 2034. He referred to various clauses of
the Development Agreement in support of this submission.
According to him, since the Society is only a lessee of the land, it
could not impose restrictions upon the petitioner's right to develop
the property in the manner permitted under the agreement. The
only limitation placed upon the petitioner was that the
redevelopment should not reduce or affect the area of the new
flats to be allotted to the members of the Society. He further
submitted that for more than thirty months, none of the dissenting
members had raised any objection regarding the manner in which
the redevelopment was proposed. Learned Senior Counsel further
submitted that after obtaining the Letter of Intent and the
Intimation of Approval dated 4 February 2026 and 16 February
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2026, the petitioner issued a notice calling upon the Society to
vacate the buildings in accordance with the Development
Agreement. Along with the notice, the Society was requested to
obtain declarations from the consenting members and to intimate
the date on which all members would hand over possession of
their respective flats so that the redevelopment work could
commence. It was further submitted that since the Intimation of
Approval had been obtained from the Slum Rehabilitation
Authority, certain members had queries regarding the location of
the PTC and also requested revision of the transit rent because the
prevailing rental rates in the locality had increased considerably.
For this reason, the Society convened a General Body Meeting on
26 February 2026. Respondent Nos.8, 10, 11, the predecessor of
respondent No.13, respondent No.14, and respondent Nos.16 and
17 attended that meeting. According to learned Senior Counsel, all
doubts raised by the members were clarified during the meeting.
The petitioner also agreed to increase the transit rent from Rs.125
per square foot to Rs.162 per square foot. The redevelopment
plans approved by the Slum Rehabilitation Authority were also
accepted by the General Body. He pointed out that, pursuant to the
directions of this Court, the minutes of the said meeting were
produced during the hearing held on 10 July 2026. Learned Senior
Counsel submitted that after the aforesaid meeting, 42 out of the
total 63 independent members of the Society executed their
declarations giving consent to the redevelopment. Learned Senior
Counsel further submitted that only the members occupying the
remaining flats did not execute the declarations of consent.
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According to him, respondent Nos.8, 10, 11, 12 and 17 are
supporting respondent No.24, who was the earlier developer, for
reasons best known to them. He submitted that the predecessor of
respondent No.13, who is also presently acting as its trustee, had
himself executed the Development Agreement and attended the
meetings relating to redevelopment. It was further submitted that
respondent Nos.14 and 15 are creating obstacles because they
have pending litigation in which they are seeking higher amounts
from the petitioner in relation to sale of shares. He also submitted
that respondent Nos.19 to 23, 25 and 26 are either persons or
entities controlled by respondent No.24, who, according to the
Society, is interested in delaying the redevelopment because of the
Commercial Suit filed by him and his personal interest in the
matter. Learned Senior Counsel submitted that every important
decision relating to redevelopment has been taken by the General
Body of the Society in its meetings. According to him, the General
Body has approved both the Development Agreement and the
redevelopment plans sanctioned by the Slum Rehabilitation
Authority. He pointed out that 42 out of 63 members are
supporting the redevelopment, whereas only a minority occupying
21 flats are opposing it. Out of those 21 flats, 11 flats are stated to
be held by entities controlled by respondent No.24. It was further
submitted that respondent Nos.13 to 15 cannot now raise
objections because they had themselves executed the Development
Agreement. Even respondent No.8 jointly owns her flat with
respondent No.9, who has signed the Development Agreement,
approved the redevelopment plans and executed the declaration of
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consent. Learned Senior Counsel also pointed out that respondent
Nos.2 to 7, who together own one flat, and respondent No.18 have
not participated in the present proceedings and therefore have not
put forward any defence.
13. Learned Senior Counsel submitted that although several
objections have been raised by the dissenting members, the Society
would deal only with those objections which concern the Society
directly. Dealing first with the objections of respondent Nos.19 and
21 regarding eight additional waitlisted flats, learned Senior
Counsel submitted that the Development Agreement clearly
records that the buildings consist of only 63 flats belonging to the
members. According to him, the recitals of the Development
Agreement specifically refer to eight waitlisted members to whom
share certificates had been issued, but who neither possess any
flats nor contributed towards construction of the buildings and
whose membership has not been recognised by the Society. The
agreement also records that any dispute regarding those claims
would be dealt with by the Society at its own cost. It was
submitted that the claims now raised by respondent Nos.19 and 21
relate only to these waitlisted memberships. Learned Senior
Counsel further submitted that respondent Nos.19 and 21 have
already been recognised as members in respect of the flats forming
the subject matter of the present petition. Therefore, according to
him, they were aware at least from December 2022 that the
Society had not recognised their alleged rights over the additional
waitlisted flats. Despite such knowledge, they never challenged
that position. He submitted that the dispute regarding those eight
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waitlisted memberships is not the subject matter of the present
proceedings. If respondent Nos.19 and 21 wish to pursue those
claims, they must do so by initiating appropriate proceedings
under the Maharashtra Co-operative Societies Act and cannot use
those disputes to prevent or delay the redevelopment. Learned
Senior Counsel also submitted that respondent Nos.19 and 21 are
not even in possession of the spaces which they claim. According
to him, these are small vacant spaces of about 100 square feet each
which are unoccupied and not fit for residence. They are
admittedly in the possession of the Society and were never in the
possession of respondent Nos.19 and 21. He further submitted that
these spaces have no doors, windows, water connection or
electricity connection. Photographs of those spaces were produced
before the Court during the hearing held on 9 July 2026. It was
further submitted that respondent Nos.19 and 21 have neither
been charged maintenance nor have they paid any maintenance in
respect of those alleged units. According to the Society, the only
maintenance bill relied upon by those respondents is of the year
2010, which was issued when respondent No.24 was acting as the
developer. Even according to those respondents, no maintenance
has been paid thereafter. Learned Senior Counsel submitted that
originally the Society had invited applications from persons
interested in becoming members and purchasing flats in Building
'A'. Share certificates were issued to eight persons on the
understanding that they would purchase flats in the proposed
building. However, Building 'A' was never constructed and
therefore those persons never paid any consideration to the
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Society. He further submitted that when respondent No.24 took
over the redevelopment, he had agreed to settle the claims of those
waitlisted members and had paid certain amounts to respondent
Nos.19 and 21 in his capacity as the then developer. Learned
Senior Counsel submitted that if respondent Nos.19 and 21 decide
to pursue claims relating to those waitlisted memberships, the
Society will contest those claims on their own merits in the
appropriate proceedings. It was further submitted that the
redevelopment, which has been approved by the General Body and
is desired by the majority of the members, cannot be brought to a
complete halt merely because respondent Nos.19 and 21 may raise
some future claim relating to the waitlisted memberships.
14. Learned Senior Counsel then dealt with the contention
raised by respondent Nos.24 to 26 that the Development
Agreement contemplated redevelopment through the Municipal
Corporation and not through the Slum Rehabilitation Authority
under Regulation 33(11). According to him, this contention is
contrary to the express terms of the Development Agreement and
has been raised only after filing of the present petition with a view
to obstruct the redevelopment. He pointed out that no such
objection was ever raised before the present proceedings. Learned
Senior Counsel submitted that the Society itself has no objection to
the petitioner undertaking redevelopment under any legally
permissible scheme, so long as the members receive the new flats
promised under the Development Agreement. According to him,
the terms of the Development Agreement, particularly the
provisions relating to development potential, FSI and other
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relevant clauses, clearly permit the petitioner to undertake
redevelopment in the manner now proposed. It was further
submitted that the petitioner had supplied copies of the approved
plans and the Intimation of Approval to the Society along with the
notice to vacate. Since some members had queries regarding the
sanctioned plans, the Society convened the General Body Meeting
on 26 February 2026 and invited representatives of the petitioner.
According to learned Senior Counsel, all questions raised by the
members were answered during that meeting and thereafter the
General Body approved the plans sanctioned by the Slum
Rehabilitation Authority. Learned Senior Counsel submitted that
merely because some clauses of the Development Agreement refer
to the Municipal Corporation or to obtaining an Intimation of
Disapproval, it cannot be inferred that redevelopment was
permitted only through the Municipal Corporation. According to
him, if such restriction had really been intended, the Development
Agreement would have specifically prohibited redevelopment
under the Slum Rehabilitation Authority scheme. He further
submitted that the General Body itself approved the
redevelopment under the Slum Rehabilitation Authority scheme in
its meeting held on 26 February 2026. It was also submitted that
the respondents have made general submissions regarding
prejudice and irreparable loss only during oral arguments before
the Court. According to learned Senior Counsel, these allegations
do not find place in their affidavits and were never raised before
the General Body. He submitted that the manner in which
redevelopment is to be carried out is a commercial decision to be
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taken by the General Body of the Society, and individual members
cannot substitute their own views for the decision taken by the
majority. He further submitted that Courts ordinarily do not
interfere with such commercial decisions or rewrite the terms of a
concluded agreement between the parties. On these grounds,
learned Senior Counsel submitted that the permissions obtained by
the petitioner are fully in accordance with the Development
Agreement and do not amount to any change in the nature of the
redevelopment.
15. Learned Senior Counsel then dealt with the objection that
the term of the Managing Committee had expired and therefore
the Development Agreement and subsequent actions were void. He
submitted that proceedings on this issue are pending before the
Deputy Registrar under Section 154B(19)(3) of the Maharashtra
Co-operative Societies Act, 1960. According to him, no interim
order has been passed in those proceedings since they were
initiated in the year 2022. Therefore, the mere pendency of those
proceedings has no bearing upon the present petition. He further
submitted that all major decisions relating to redevelopment have
been taken by the General Body with the required majority and in
the interest of the members, and not by the Managing Committee
acting on its own. In conclusion, learned Senior Counsel submitted
that the majority of the members have consented to the
redevelopment proposed by the petitioner and have executed
declarations giving their consent. According to him, the members
are anxious to proceed with the redevelopment because the
existing buildings are old and in a dilapidated condition, portions
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of the slabs have started falling, and serious cracks have appeared
in the overhead water tank. He therefore submitted that the
Society supports the reliefs sought by the petitioner so that the
redevelopment project may proceed without further delay.
16. Learned Advocate Ms. Prachi Tatake, appearing for
respondent Nos.8, 10, 11, 12 and 15, submitted that these
respondents are senior citizens who have been residing in the
Society for more than forty years. According to her, they have
consistently opposed what they describe as the illegal functioning
of the Managing Committee whose term has already expired. She
submitted that these respondents are the original disputants in
proceedings filed under Section 91 of the Maharashtra Co-
operative Societies Act before the Co-operative Court and are also
complainants before the Deputy Registrar of Co-operative
Societies. It was argued that they have never consented to the
redevelopment proposed by the Society. On the contrary, they have
challenged the execution of the Development Agreement dated 26
December 2023 on the ground that the Society failed to follow a
fair, transparent and lawful procedure. She further submitted that
these respondents have never agreed to redevelopment under
Regulations 33(10) and 33(11) of the Development Control and
Promotion Regulations or to the amalgamation of neighbouring
plots. Learned counsel submitted that for several reasons the
Development Agreement does not create any valid or binding
rights in favour of the petitioner. According to her, once the
Development Agreement itself is invalid, the petitioner cannot seek
the interim reliefs prayed for in the present petition under Section
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9 of the Arbitration and Conciliation Act. Learned counsel further
submitted that a petition under Section 9 can be entertained only
if the disputes intended to be referred to arbitration are capable of
being decided through arbitration. According to her, the petition
proceeds on the assumption that such disputes are arbitrable
because the Development Agreement contains an arbitration
clause. She argued that this assumption is fundamentally incorrect
because the Development Agreement was executed by a Managing
Committee whose term had already expired and on the basis of a
resolution allegedly passed only by a small number of members.
Even assuming that such resolution was valid at that time, it could
not be treated as an informed and express consent of all the
members for redevelopment under Regulations 33(10) or 33(11).
She submitted that such informed consent is required under
Section 79A of the Maharashtra Co-operative Societies Act. In the
absence of such consent, according to her, the disputes are not
arbitrable and therefore no relief can be granted under Section 9.
Learned counsel also relied upon the decision in Booz Allen and
Hamilton Inc. v. SBI Home Finance Ltd. She submitted that the
disputes sought to be raised by the petitioner are not capable of
being referred to arbitration because they involve rights affecting
the public at large and rights in rem. According to her,
redevelopment under Regulations 33(10) and 33(11) was never
agreed upon by the parties and therefore such issues cannot be
decided in arbitration. Learned counsel further submitted that
these respondents have throughout opposed what they describe as
the illegal functioning of the Managing Committee. According to
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her, after expiry of its term, the Managing Committee continued to
control the affairs of the Society without any legal authority, took
important policy decisions, executed the Development Agreement
and changed the entire nature of the redevelopment. She alleged
that the redevelopment scheme was altered from one originally
proposed to one under Regulations 33(10) and 33(11) in collusion
with the petitioner so as to confer undue benefits upon those
involved.
17. Learned counsel pointed out that the existing Managing
Committee was elected on 10 April 2016 and its tenure expired on
9 April 2021. It was further submitted that the proposal originally
given by the petitioner in the year 2017 has undergone substantial
changes over the years with the support of the office bearers of the
Society, who according to the respondents, continued to function
even after expiry of their term. Learned counsel submitted that the
nature and scope of the redevelopment, the planning authority, the
utilisation of FSI and the amalgamation of adjoining plots are all
materially different from what was originally proposed and that
none of these changes has been approved by the members.
According to her, although the Development Agreement refers to
the Municipal Corporation as the planning authority, the petitioner
has unilaterally approached the Slum Rehabilitation Authority and
obtained Intimations of Approval dated 4 February 2026 and 16
February 2026 without obtaining the consent of the members and
contrary to the terms of the Development Agreement. In support of
the above submission, learned counsel referred to various clauses
of the Development Agreement. She submitted that Clause 3.3
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contemplates approval of plans by the Municipal Corporation and
obtaining an Intimation of Disapproval, whereas the petitioner has
obtained an Intimation of Approval from the Slum Rehabilitation
Authority. She further submitted that Clause 3.6 requires consent
of the Society members before amalgamation of plots, but no such
consent was obtained. According to her, Clause 18.2 permits
demolition and exercise of development rights only after issuance
of an Intimation of Disapproval and also contemplates registration
of the project under RERA. She also submitted that Clause 20.2
requires the developer to place the approved plans and the
Intimation of Disapproval before the Society for verification, which
according to her has not been done. She further pointed out that
the Second Schedule to the Development Agreement records
details of only 63 members and provides that any claims made by
persons not included in the list are to be dealt with by the Society
at its own cost. According to her, the Development Agreement
ignores eight additional flats and also does not account for the two
flats belonging to the intervenors in the present proceedings. She
submitted that as a result, the majority relied upon by the
petitioner is itself incorrect and the members of the Society may
ultimately have to bear the expenses of disputes raised by third
parties, chawl tenants and transit tenants. Learned counsel further
submitted that the Society does not possess the required majority
to proceed with the Development Agreement because, according to
her, the total number of flats is 73 and not 63. She pointed out
that the General Body Meeting held on 16 December 2022 was
attended by only 24 members, many of whom are themselves
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respondents in the present petition. According to her, such
attendance cannot constitute valid consent of the members. She
also submitted that copies of the relevant documents and minutes
of the meetings were never supplied to the members. Learned
counsel submitted that the General Body Resolution dated 16
December 2022, the meetings allegedly held in November and
December 2022, and the subsequent resolution passed in January
2026 approving the appointment of the petitioner and execution of
the Development Agreement have all been challenged before the
Co-operative Court. According to her, objections regarding the
meetings held in November and December 2022 were raised by
these respondents through complaints before the Managing
Committee and the Deputy Registrar. They had also sought
inspection of the Society records, but according to the information
received from the Deputy Registrar, such inspection was not
granted. She further pointed out that directions for conducting fair
elections were issued on 25 February 2026. According to her,
objections were also submitted before the Managing Committee in
January and February 2026 after the respondents came to know
about the proposed redevelopment under Regulations 33(10) and
33(11). Similar objections were raised in the Special General Body
Meeting held on 25 February 2026. She lastly submitted that an
appeal challenging the General Body Resolution dated 25 February
2026 was allowed by the Divisional Joint Registrar by an order
dated 3 July 2026. Learned counsel submitted that by changing
the redevelopment from the original proposal to redevelopment
under Regulation 33(11) without any valid resolution of the
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General Body, the petitioner has substantially altered the
Development Agreement. According to her, such a fundamental
change could not have been made without first passing a proper
resolution approving the modification of the Development
Agreement. She further submitted that the petitioner now
proposes to construct Project Affected Tenement buildings and
shift them to another plot under a clubbing scheme, as discussed
in the Special General Body Meeting held on 26 February 2026.
According to her, that meeting itself has been challenged. She
therefore argued that the present redevelopment is not in
accordance with the original Development Agreement and, in the
absence of approval by a legally constituted Managing Committee
and a valid resolution of the General Body, no directions under
Section 9 of the Arbitration and Conciliation Act can be issued
against these respondents. Lastly, learned counsel submitted that
these respondents have already filed Co-operative Dispute No.
CC/II/125 of 2026 before the Co-operative Court challenging all
the General Body Resolutions passed from the year 2022 onwards.
According to her, the present petition under Section 9 has been
filed only to defeat and bypass the issues raised in those
proceedings. She pointed out that the dispute before the Co-
operative Court is still pending and was listed for hearing on 10
July 2026.
18. Learned Advocate Mr. Choudhari, appearing for respondent
No.13, submitted that the present written submissions are in
addition to the affidavit in reply dated 29 June 2026 filed on
behalf of respondent No.13 and the oral submissions advanced
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during the course of hearing. Learned counsel first submitted that
the Permanent Alternate Accommodation Agreement (PAAA) has
not yet been executed and registered. According to him, the
present petition, which came to be filed on 28 April 2026 under
Section 9 of the Arbitration and Conciliation Act, is therefore
premature and not maintainable. He submitted that even from the
facts stated by the petitioner in the petition itself, it is clear that
the necessary preconditions for seeking such relief had not been
completed when the petition was filed. Learned counsel pointed
out that in paragraph 25 of the petition, the petitioner has stated
that after obtaining the required permissions, a notice dated 20
February 2026 was issued to respondent No.1 Society calling upon
the Society and its members to hand over possession of their
respective flats within a period of 45 days. He further submitted
that paragraph 28 of the petition records that since respondent
Nos.2 to 26 had not submitted their declarations of consent, the
petitioner issued three further notices dated 15 April 2026 calling
upon them to avoid creating any obstruction in the redevelopment
and to submit their declarations mentioning the date on which
possession of their flats would be handed over. Learned counsel
also referred to paragraph 56 of the petition, wherein the
petitioner has stated that the Society was in the process of
completing the allotment of new flats in the proposed building.
According to him, the petitioner has itself stated that the
Permanent Alternate Accommodation Agreements would be
executed and registered only after the Society completed the
process of allotting the new flats. Learned counsel then invited
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attention to Clause 19.1 of the Development Agreement dated 26
December 2023. According to him, the said clause specifically
requires the developer to execute and register Permanent Alternate
Accommodation Agreements in favour of the members before
issuing any notice calling upon them to vacate their existing flats.
On the basis of the above clause, learned counsel submitted that
the petitioner could have acquired a right to issue vacation notices
only after execution and registration of the Permanent Alternate
Accommodation Agreements. According to him, until that
requirement was fulfilled, no cause of action had arisen in favour
of the petitioner. He therefore submitted that the notices dated 20
February 2026 and 15 April 2026, as well as the filing of the
present petition on 28 April 2026, were all premature and without
any legal foundation. Learned counsel further submitted that in
the Special General Body Meeting held on 12 July 2026, a
resolution regarding allotment of new flats was passed despite
objections raised by certain members. According to him, some
members had requested reasonable time to examine the proposed
allotment and consider its advantages and disadvantages before
taking any decision. However, that request was rejected by the
office bearers of the Society. It was further submitted that the
members were not given adequate time to study the details of the
proposed allotment of the new flats. According to learned counsel,
because of the hurried manner in which the process was carried
out, serious prejudice has been caused to several members.
Learned counsel therefore submitted that not only was the petition
filed before any cause of action had arisen, but even on the date
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when the matter was finally heard and reserved for orders, the
petitioner had still not acquired a valid cause of action to seek the
reliefs prayed for.
19. Learned counsel next submitted that the redevelopment
plans themselves are not final. He referred to paragraph 24 of the
petition, wherein the petitioner has stated that the Slum
Rehabilitation Authority has approved the redevelopment of both
the Rachana Plots and the adjoining Meena Plots by issuing
Intimations of Approval dated 4 February 2026 and 16 February
2026. However, according to learned counsel, the minutes of the
Special General Body Meeting held on 26 February 2026 disclose a
different position. Referring particularly to the discussion under
Agenda No.1, he submitted that the petitioner informed the
members that although the approved plans presently show the
Project Affected Tenement buildings on the Society's plot, those
buildings would ultimately be shifted to another plot under a
clubbing scheme and the plans would be amended in due course.
According to him, this itself shows that the sanctioned plans are
not final even according to the petitioner. Learned counsel
thereafter submitted that the present petition filed under Section 9
is itself misconceived and amounts to misuse of the process of the
Court. According to him, the principal relief sought by the
petitioner is a direction requiring respondent Nos.2 to 26 to vacate
their flats and cooperate with the redevelopment of the Rachana
and Meena Plots. Learned counsel submitted that although the
petitioner has sought appointment of the Court Receiver, the real
object behind that prayer is to obtain vacant possession of the flats
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before commencement of arbitration proceedings. According to
him, if the relief sought is granted, the petitioner would
immediately demolish the existing buildings even before an
Arbitral Tribunal is constituted and before arbitration proceedings
actually begin. Learned counsel further submitted that paragraph
35 of the petition itself shows that disputes between the petitioner
and respondent Nos.2 to 26 are proposed to be referred to
arbitration. According to him, despite this, the petitioner does not
wish to wait for constitution of the Arbitral Tribunal and instead
seeks substantially the same relief from this Court under Section 9.
It was therefore submitted that a petition under Section 9 is not
the proper remedy for seeking the reliefs claimed in the present
case. According to learned counsel, the reliefs prayed for are not
temporary or protective in nature. If granted, they would virtually
amount to granting the petitioner its final relief even before
arbitration proceedings commence. Learned counsel submitted
that the reliefs sought by the petitioner cannot be treated as
interim measures of protection. According to him, such issues
should properly be decided by the Arbitral Tribunal after it is
constituted. He further submitted that nothing stated in the
petition discloses any urgency or emergency requiring this Court to
grant such drastic relief at the present stage. Learned counsel
therefore submitted that if circumstances so require, it would
always be open for the petitioner to approach the Arbitral Tribunal
after its constitution and seek appropriate interim protection under
Section 17 of the Arbitration and Conciliation Act.
20. Without prejudice to the above submissions, learned counsel
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submitted that if this Court is nevertheless inclined to grant any
relief in favour of the petitioner, adequate safeguards should first
be provided to protect respondent No.13. In this regard, he
referred to Clause 22.1 of the Development Agreement, under
which the petitioner has agreed to retain an area measuring 3000
square feet in the new building as security. According to him, that
area is to remain reserved until the petitioner achieves the
milestones specified in the agreement. Learned counsel further
submitted that respondent No.13 has heard the objections raised
by various parties in the present proceedings and is concerned
about the large number of litigations pending against the
petitioner in different Courts and forums. According to him,
respondent No.13 is mainly apprehensive whether, in view of these
disputes, the redevelopment project will be completed at all and
whether respondent No.13 will ultimately receive its permanent
alternate flat in the newly constructed building. It was further
submitted that respondent No.13 has two genuine concerns. First,
there is apprehension that the petitioner may fail to complete the
redevelopment project and hand over possession of the new flat
after obtaining the Occupation Certificate. Secondly, there is
apprehension that there may be delay or default in payment of
transit rent, hardship compensation and other monetary benefits
payable under the Development Agreement. Learned counsel
therefore prayed that, if any relief is granted to the petitioner, the
petitioner should first be directed to furnish sufficient security,
either by way of a bank guarantee or any other suitable security, so
as to safeguard the rights and interests of respondent No.13 in
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respect of the new flat proposed to be allotted in place of existing
Flat No.A-601. On the above grounds, learned counsel submitted
that the petitioner has failed to make out any case for grant of the
drastic reliefs sought in the petition and therefore the petition
deserves to be dismissed.
21. Mr. Gupta learned counsel adopted the submissions made on
behalf of respondent Nos.14 and 15. It was submitted that the
flagship company of the petitioner's director, Mr. Vinay Patil,
namely Samruddha Resources Limited, is facing insolvency
proceedings before the National Company Law Tribunal and
several proceedings under Section 138 of the Negotiable
Instruments Act. It was further submitted that the balance sheet of
Polestar, produced by the petitioner in rejoinder, shows negligible
capital and no business activity. According to respondent Nos.14
and 15, these circumstances show that the petitioner lacks the
financial strength and technical capability to complete the
redevelopment and therefore the claims made by the petitioner are
without substance. It was further submitted that the minutes of
the meeting dated 26 February 2026 relied upon by the petitioner
are fabricated, manipulated and prepared only to create an
impression that the members had consented to the redevelopment.
Learned counsel lastly submitted that despite repeated written
requests, copies of the minutes of the meeting were never
circulated to the members. According to him, the minutes were
deliberately withheld and were forwarded only at about 11.50
p.m. so as to prevent the members from raising objections. He
further submitted that the video recording of the Special General
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Body Meeting dated 26 February 2026, which according to him
contains objections raised by several members, has been
deliberately withheld. It was argued that the contents of the video
recording are inconsistent with the minutes relied upon by the
petitioner and that this amounts to practising fraud upon the
Court.
22. Learned Senior Advocate Mr. Godbole, appearing for
respondent No.19, submitted that the present petition under
Section 9 of the Arbitration and Conciliation Act has been filed
against respondent No.19 only in respect of Flat Nos. A/303 and
A/701 situated in Building 'A' of respondent No.1 Society.
According to him, respondent No.19 is holding a total of nine flats
in Building 'A', namely Flat Nos. A/101, A/102, A/103, A/202,
A/203, A/204, A/303, A/403 and A/701, in its capacity as a
member of the Society. He submitted that respondent No.19
possesses share certificates in respect of some of these flats and has
also been issued maintenance bills by the Society from time to
time. Learned Senior Counsel submitted that through the present
petition the petitioner seeks directions requiring respondent No.19
to vacate the two flats mentioned above and also seeks
appointment of a Court Receiver to take physical possession of
those flats with police assistance so that the petitioner may
demolish the existing building. According to him, even if such
relief is confined only to the two flats referred to in the petition,
demolition of Building 'A' would inevitably affect the remaining
seven flats claimed by respondent No.19 in the same building. He
submitted that the petitioner has neither sought any relief nor
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made out any case in respect of those remaining seven flats, which
are not covered either by the vacation notices or by the present
petition. Learned Senior Counsel further submitted that the
Development Agreement dated 26 December 2023 proceeds on the
basis that respondent No.1 Society consists of 63 members.
According to him, this is factually incorrect because the Society
actually consists of 73 members. In support of this submission, he
relied upon the order dated 20 September 2022 passed by the
Deputy Registrar, Co-operative Societies, H-West Ward, Mumbai,
under Section 18 of the Maharashtra Co-operative Societies Act
read with Rule 17 of the Maharashtra Co-operative Societies Rules,
whereby the Society was bifurcated into one Society having 73
members and another Society having 8 members.Learned Senior
Counsel submitted that the petitioner now proposes to construct
Project Affected Tenement buildings under Regulation 33(11) of
the Development Control and Promotion Regulations, 2034 and
thereafter shift those buildings from the Society's plot to another
plot under a clubbing scheme. According to him, this proposal is
reflected in the minutes of the Special General Body Meeting held
on 26 February 2026. He argued that such redevelopment is not
contemplated under the original Development Agreement and
amounts to a substantial variation or modification of that
agreement. According to him, no such modification could have
been made unless a valid resolution had first been passed by the
Society and a registered addendum had been executed amending
the Development Agreement. He therefore submitted that until
such resolution and registered addendum come into existence, the
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petitioner could not issue vacation notices to the members or
initiate proceedings under Section 9 of the Arbitration and
Conciliation Act. On that basis, he submitted that the vacation
notice dated 17 April 2026 is premature, invalid and
unenforceable.
23. Learned Senior Counsel further submitted that the minutes
of the meeting dated 26 February 2026 cannot by themselves be
treated as a valid resolution of the Special General Body Meeting.
According to him, every resolution passed in such meeting must
thereafter be circulated to all members and also be confirmed or
ratified in a subsequent General Body Meeting before it becomes
effective. He submitted that since no such ratification has taken
place, the minutes cannot be treated as approval of the revised
redevelopment plans or redevelopment under Regulation 33(11).
Learned Senior Counsel further argued that even assuming the
minutes dated 26 February 2026 amount to a valid resolution, the
Development Agreement could not automatically stand amended.
According to him, a written and registered addendum modifying
the Development Agreement was still necessary. Since no such
registered addendum has been executed, he submitted that the
petitioner cannot rely upon the alleged changes in the
redevelopment scheme. Learned Senior Counsel submitted that the
provisions relating to vacation notices contained in Clauses 15.2
and 15.3 of the Development Agreement could come into
operation only after such registered addendum was executed and
incorporated into the agreement. According to him, only thereafter
could valid vacation notices be issued to the members and only
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thereafter could proceedings under Section 9 of the Arbitration
and Conciliation Act be initiated. He therefore submitted that both
the vacation notices and the present petition are premature, illegal
and not maintainable in law. Learned Senior Counsel also
submitted that the petitioner cannot seek relief under Section 9 in
a manner which indirectly affects the rights of members and non-
members whose premises are not even included in the present
petition. According to him, several other flats in Building 'A' are
occupied by persons who are not parties to these proceedings or
whose flats are not covered either by the Development Agreement,
the vacation notices or the present petition. He therefore
submitted that the petitioner has no cause of action to seek relief
affecting those persons through the present proceedings. Learned
Senior Counsel further submitted that the principal object of the
present petition is to obtain vacant possession of certain flats so
that demolition of the existing building and redevelopment can
commence. He pointed out that, according to the order of the
Deputy Registrar dated 20 September 2022, there are altogether
73 occupied flats in the Society building. He also submitted that
during the hearing held on 9 July 2026, the petitioner itself
accepted that position. According to him, the present petition seeks
possession only of some specified flats and does not seek any relief
in respect of the remaining occupied flats. Therefore, even if all the
reliefs claimed in the petition are granted and the occupants of
those specified flats vacate their premises, demolition of the
building and commencement of redevelopment would still not be
possible because many other occupied flats would continue to
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remain in possession of their respective occupants. He therefore
submitted that the petitioner has failed to establish any real
urgency or immediate necessity for invoking the extraordinary
jurisdiction of this Court under Section 9 of the Arbitration and
Conciliation Act. On the above grounds, learned Senior Counsel
submitted that the petitioner has failed to make out any case for
grant of interim relief and that the present petition deserves to be
dismissed with costs.
24. Learned Advocate Mr. Rawool, appearing for respondent
Nos.20, 22 and 23, submitted that the provisions relating to
issuance of a vacation notice under Clauses 15.2 and 15.3 of the
Development Agreement could come into operation only after a
registered addendum modifying the Development Agreement had
been executed and incorporated into those clauses. According to
him, only thereafter could the petitioner issue valid vacation
notices to the members of respondent No.1 Society and thereafter
initiate proceedings under Section 9 of the Arbitration and
Conciliation Act. He therefore submitted that both the vacation
notices and the present petition are premature, misconceived and
invalid in law, and consequently no interim relief can be granted in
favour of the petitioner. Learned counsel further submitted that
respondent Nos.20, 22 and 23 adopt and rely upon all the
submissions advanced on behalf of respondent Nos.19, 21, 24, 25
and 26. He submitted that those submissions may also be treated
as forming part of the case of respondent Nos.20, 22 and 23. On
the basis of the above submissions, learned counsel contended that
the petitioner has failed to make out any case for grant of relief
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under the present petition and therefore the petition deserves to be
dismissed with costs.
25. Learned Advocate Mr. Kanetkar, appearing for respondent
No.21, submitted that the present petition under Section 9 of the
Arbitration and Conciliation Act, 1996 has been filed against
respondent No.21 only in respect of Flat No. A/502 situated in
Building 'A' of respondent No.1 Society. According to him,
respondent No.21 is holding two flats in Building 'A', namely Flat
Nos. A/104 and A/502, in its capacity as a member of the Society.
Learned counsel submitted that by the present petition the
petitioner seeks a direction requiring respondent No.21 to vacate
Flat No. A/502 and also seeks appointment of a Court Receiver to
take physical possession of that flat with police assistance so that
Building 'A' can be demolished. According to him, even if such
relief is granted only in respect of Flat No. A/502, demolition of
the building would also affect the rights of respondent No.21 in
respect of its other flat, namely Flat No. A/104. He submitted that
the petitioner has neither sought any relief nor made out any case
regarding that remaining flat, which is not covered by the vacation
notice or by the present petition. Learned counsel further
submitted that the Development Agreement dated 26 December
2023 proceeds on the basis that respondent No.1 Society has only
63 members. According to him, this is not factually correct because
the Society actually consists of 73 members. In support of this
submission, he relied upon the order dated 20 September 2022
passed by the Deputy Registrar, Co-operative Societies, H-West
Ward, Mumbai, under Section 18 of the Maharashtra Co-operative
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Societies Act read with Rule 17 of the Maharashtra Co-operative
Societies Rules, whereby one Society consisting of 73 members and
another Society consisting of 8 members came to be recognised
after bifurcation. Learned counsel submitted that the petitioner
now proposes to construct Project Affected Tenement buildings
under Regulation 33(11) of the Development Control and
Promotion Regulations, 2034 and thereafter shift those tenements
from the Society's plot to another plot under a clubbing scheme.
According to him, this proposal was discussed in the Special
General Body Meeting held on 26 February 2026. He submitted
that such redevelopment is not contemplated under the original
Development Agreement and amounts to a material variation or
modification of its terms. According to him, no such change could
have been made without passing a valid resolution of the Society
and executing a registered addendum modifying the Development
Agreement. He therefore submitted that until such resolution is
passed and the addendum is executed and registered, the
petitioner cannot issue any vacation notice to respondent No.21 or
initiate proceedings under Section 9 of the Arbitration and
Conciliation Act. Learned counsel further submitted that the
minutes of the meeting dated 26 February 2026 cannot be treated
as a valid resolution of the Special General Body Meeting.
According to him, every resolution passed at such meeting is
required to be circulated to all members and thereafter ratified and
confirmed in a subsequent General Body Meeting before it
becomes effective. Since no such ratification or confirmation has
taken place, he submitted that the minutes cannot be treated as
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approval of the revised redevelopment plans or redevelopment
under Regulation 33(11) of the Development Control and
Promotion Regulations, 2034. Learned counsel further submitted
that even assuming the minutes dated 26 February 2026 amount
to a valid resolution of the Society, the Development Agreement
could not stand modified automatically. According to him, a
written and registered addendum between the petitioner and
respondent No.1 Society was still necessary. Since no such
registered addendum has been executed, the petitioner cannot rely
upon the alleged changes in the redevelopment scheme. Learned
counsel submitted that the provisions relating to issuance of a
vacation notice under Clauses 15.2 and 15.3 of the Development
Agreement could come into operation only after such registered
addendum had been incorporated into the agreement. According
to him, only thereafter could the petitioner issue a valid vacation
notice to the members and thereafter institute proceedings under
Section 9 of the Arbitration and Conciliation Act. He therefore
submitted that both the vacation notice and the present petition
are misconceived, premature and invalid in law, and consequently
no relief can be granted to the petitioner. Learned counsel also
submitted that the petitioner cannot invoke Section 9 of the
Arbitration and Conciliation Act in a manner which affects the
rights of members and non-members whose flats are not included
in the present petition. According to him, the petitioner has no
cause of action to seek relief, directly or indirectly, against persons
whose premises are neither covered by the Development
Agreement nor by the vacation notice or the present proceedings.
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On the basis of the above submissions, learned counsel contended
that the petitioner has failed to make out any case for grant of
interim relief and therefore the present petition deserves to be
dismissed with costs.
26. Learned Senior Advocate Mr. Andhyarujina, appearing for
respondent No.25, submitted that the present petition under
Section 9 of the Arbitration and Conciliation Act has been filed
only as a counterblast to the proceedings already initiated by
respondent No.24. According to him, respondent No.24 has filed
Commercial Suit No.409 of 2017 against respondent No.1 Society,
the present petitioner and M/s. Saboo and Varun seeking specific
performance of the Tripartite Agreement dated 8 December 2006
along with other consequential reliefs. He submitted that the
present proceedings have been instituted only to defeat the rights
asserted by respondent No.24 in the said suit. Learned Senior
Counsel further submitted that in Commercial Suit No.409 of
2017, this Court had passed an order dated 5 May 2017 in Notice
of Motion (L) No.253 of 2017 observing that all steps taken by the
defendants would remain subject to the further orders of the Court
at the time of final hearing of the Notice of Motion. According to
him, the said Notice of Motion is still pending for final hearing and
disposal before this Court. Learned Senior Counsel also referred to
Interim Application No.2696 of 2026 filed in the same Commercial
Suit. He pointed out that by order dated 24 June 2026, this Court
observed that any steps taken by the defendants during the
pendency of the proceedings would remain subject to the orders to
be passed in the Interim Application. Learned Senior Counsel
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submitted that the said Interim Application is still pending. He
further submitted that under the earlier Development Agreement
dated 8 December 2006, respondent No.24 had already obtained
sanctioned plans for construction of Building 'C' on the Society's
property, having an area of 563.86 square metres comprising
ground floor and three upper floors. According to him, those
sanctioned plans had remained valid up to 4 April 2026. Learned
Senior Counsel submitted that under the present Development
Agreement dated 26 December 2023, the petitioner has, contrary
to its own contractual obligations, amalgamated the property of
respondent No.1 Society with the adjoining property of Meena
Apartment Co-operative Housing Society under the Development
Control and Promotion Regulations, 2034. According to him, by
doing so the petitioner has changed the identity of the suit
property involved in the pending Commercial Suit. He further
submitted that the petitioner now proposes to construct Tower
No.3 at the same location where Building 'C' had already been
sanctioned under the earlier Tripartite Agreement dated 8
December 2006 executed in favour of respondent No.24. Learned
Senior Counsel further submitted that the Development Agreement
dated 26 December 2023 refers to the Municipal Corporation of
Greater Mumbai as the planning authority. However, according to
him, the petitioner has instead approached the Slum Rehabilitation
Authority and obtained Intimations of Approval dated 4 February
2026 and 16 February 2026. He submitted that this course of
action is contrary to the terms of the Development Agreement
itself.
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27. Learned Senior Counsel also submitted that the petitioner
now proposes to construct Project Affected Tenement buildings
under Regulation 33(11) of the Development Control and
Promotion Regulations, 2034 and thereafter shift those tenements
from the Society's plot to another plot under a clubbing scheme.
According to him, this proposal was stated to have been discussed
in the Special General Body Meeting held on 26 February 2026. He
submitted that such redevelopment is outside the scope of the
original Development Agreement and amounts to a material
variation or modification of its terms. According to him, no such
modification could have been made without first passing a valid
resolution of the Society and thereafter executing and registering
an addendum amending the Development Agreement. He
therefore submitted that until such resolution is passed and the
registered addendum comes into existence, the petitioner cannot
issue vacation notices to respondent Nos.24 and 25 or invoke
Section 9 of the Arbitration and Conciliation Act. Learned Senior
Counsel further submitted that interim relief under Section 9 of
the Arbitration and Conciliation Act can be granted only when the
petitioner shows its readiness and willingness to perform its own
obligations under the Development Agreement. According to him,
the Development Agreement has become unenforceable because
there is neither a valid resolution of the Society approving the
altered redevelopment nor any addendum or corrigendum
modifying the agreement. He further submitted that there are
admitted departures between the contractual terms contained in
the Development Agreement and the redevelopment now proposed
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by the petitioner. Therefore, according to him, the petitioner itself
is not acting in accordance with the Development Agreement and
consequently is not entitled to seek interim protection under
Section 9. Learned Senior Counsel also submitted that the
petitioner is not entitled to any interim relief because such relief
can only be granted in aid of the final relief which may ultimately
be claimed in arbitration. According to him, the petitioner cannot
ultimately succeed on the basis of the present Development
Agreement since that agreement does not contemplate
redevelopment under Regulation 33(11) of the Development
Control and Promotion Regulations, 2034. Therefore, according to
him, no interim relief can be granted at this stage. On the basis of
the above submissions, learned Senior Counsel contended that the
petitioner has failed to make out any case for grant of relief under
the present petition and therefore the petition deserves to be
dismissed with costs.
28. Learned Advocate Mr. Mayur Khandeparkar, appearing for
respondent No.26, submitted that the petitioner referred to the
minutes of the Special General Body Meeting dated 26 February
2026 for the first time only when a query was raised by this Court
during the hearing held on 9 July 2026. According to him, the
petitioner has never produced any valid resolution passed in that
meeting. He submitted that there is no proper foundation in the
petition regarding the alleged Special General Body Meeting or the
alleged resolution approving the Letter of Intent, the proposed
Permanent Transit Camp buildings, or the redevelopment of the
Rachana Society property along with the adjoining Meena
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Apartment property. Learned counsel further submitted that
respondent No.1 Society has placed considerable reliance upon the
minutes of the Special General Body Meeting dated 26 February
2026. According to him, those minutes themselves record that the
petitioner informed the members that the Permanent Transit Camp
buildings shown on the approved plans would not ultimately be
constructed on the Society's plot and would instead be shifted to
another plot in accordance with the usual practice followed in
redevelopment projects. He submitted that the petitioner had also
informed the members that the plans would be amended in future
so that the Permanent Transit Camp buildings could be shifted to
another plot under a clubbing scheme. According to learned
counsel, this itself shows that even on 26 February 2026 the
redevelopment plans had not attained finality and further changes
were contemplated by the petitioner. He therefore submitted that
Clause 15.2 of the Development Agreement had not come into
operation and consequently the petitioner could neither issue
vacation notices to the members nor maintain the present petition
under Section 9 of the Arbitration and Conciliation Act. Learned
counsel further submitted that the petitioner now proposes to
construct Permanent Transit Camp buildings under Regulation
33(11) of the Development Control and Promotion Regulations,
2034 and thereafter shift those buildings from the Society's plot to
another plot under a clubbing scheme. According to him, this
proposal, which is stated to have been discussed in the Special
General Body Meeting held on 26 February 2026, is outside the
scope of the Development Agreement dated 26 December 2023.
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He submitted that such a proposal amounts to a variation or
modification of the Development Agreement and could not have
been implemented without first passing a valid resolution of the
Society and thereafter executing and registering an addendum
amending the Development Agreement. According to him, unless
these requirements are fulfilled, no vacation notice can be issued
to respondent No.26 or any other member and proceedings under
Section 9 of the Arbitration and Conciliation Act cannot be
maintained.
29. Learned counsel further submitted that even assuming,
without admitting, that the minutes dated 26 February 2026
amount to a valid resolution of the Special General Body Meeting,
the Development Agreement could still not stand modified
automatically. According to him, a written and registered
addendum between the Society and the petitioner was necessary
to bring such changes into effect. Since no such addendum has
been executed, he submitted that the petitioner cannot rely upon
the altered redevelopment scheme. Learned counsel also submitted
that the minutes of the meeting dated 26 February 2026 do not
constitute a valid and binding resolution of the Special General
Body Meeting. According to him, every resolution passed at such
meeting is required to be circulated to all members and thereafter
ratified and confirmed in a subsequent General Body Meeting
before it becomes effective. Since no such ratification or
confirmation has taken place, he submitted that the minutes
cannot be treated as approval of the revised redevelopment plans
or redevelopment under Regulation 33(11) of the Development
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Control and Promotion Regulations, 2034. Learned counsel further
submitted that the Development Agreement itself contains no
provision or foundation regarding amendment of the building
plans or redevelopment under the revised scheme resulting in the
Letter of Intent with the Permanent Transit Camp component.
According to him, in the absence of such contractual provision, no
vacation notice could have been issued under Clause 15.2 of the
Development Agreement and consequently no petition under
Section 9 of the Arbitration and Conciliation Act could have been
filed on the basis of such notice. Learned counsel submitted that
the provisions relating to issuance of vacation notices under
Clauses 15.2 and 15.3 of the Development Agreement could
become operative only after a registered addendum incorporating
the modified terms into the Development Agreement had been
executed. According to him, only thereafter could the petitioner
issue valid vacation notices to the members and thereafter initiate
proceedings under Section 9 of the Arbitration and Conciliation
Act. He therefore submitted that both the vacation notices and the
present petition are misconceived, premature and invalid in law,
and consequently no relief can be granted to the petitioner.
Learned counsel further submitted that respondent No.26 adopts
and relies upon all the submissions advanced on behalf of
respondent Nos.19, 21, 24 and 25. According to him, those
submissions may also be treated as part of the case of respondent
No.26. On the basis of the above submissions, learned counsel
contended that the petitioner has failed to establish any case for
grant of interim relief and therefore the present petition deserves
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to be dismissed with costs.
30. Learned Senior Advocate Mr. Kamdar, appearing on behalf of
M/s. Saboo and Varun, submitted that the applicant has filed the
present Interim Application seeking intervention and impleadment
in the present petition filed under Section 9 of the Arbitration and
Conciliation Act. According to him, the petitioner has sought relief
only in respect of the flats occupied by 63 members and has not
included Flat Nos. A/804 and A/904 belonging to the applicant, as
well as certain other flats. Learned Senior Counsel submitted that
the petitioner has sought directions requiring respondent Nos.2 to
26 to vacate their respective flats and has also prayed for
appointment of a Court Receiver to take physical possession of
those flats with police assistance so that Building 'A' can be
demolished. According to him, if such relief is granted, the rights
of the applicant, who owns Flat Nos. A/804 and A/904 in the same
building, will also be directly affected. It is for this reason that the
applicant has sought permission to intervene and be impleaded in
the present proceedings. Learned Senior Counsel submitted that
the applicant is the owner of the aforesaid two flats and has been
in lawful possession thereof. According to him, the applicant
continues to occupy those flats and regularly pays all maintenance
charges, municipal taxes, electricity bills, water charges and other
outgoings in respect of those premises. It was further submitted
that, to the knowledge of both the petitioner and respondent No.1
Society, these two flats have been given on leave and licence basis
since the year 2007 and continue to remain under such
arrangement even today. Learned Senior Counsel submitted that
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without issuing any notice to the applicant in respect of these two
flats and without initiating any proceedings against the applicant,
the petitioner and respondent No.1 Society are attempting to
obtain orders from this Court permitting demolition of the entire
building. According to him, this has been done by suppressing the
fact that the applicant has independent rights in the said two flats.
Learned Senior Counsel further submitted that despite being fully
aware of the applicant's rights, the petitioner has deliberately and
intentionally neither impleaded the applicant as a party to the
petition nor served any notice upon it. Learned Senior Counsel
submitted that Building 'A' was completed and occupied in the
year 1999 and that its lift had been installed in the year 1998.
According to him, the building is less than thirty years old, is
structurally sound, its reinforced concrete structure has been
properly maintained, and therefore it does not require demolition.
Learned Senior Counsel further submitted that the Development
Agreement dated 26 December 2023 incorrectly proceeds on the
basis that respondent No.1 Society has only 63 members.
According to him, the Society in fact consists of 73 members. In
support of this submission, he relied upon the order dated 20
September 2022 passed by the Deputy Registrar, Co-operative
Societies, H-West Ward, Mumbai, under Section 18 of the
Maharashtra Co-operative Societies Act read with Rule 17 of the
Maharashtra Co-operative Societies Rules, whereby one Society
consisting of 73 members and another Society consisting of 8
members came to be recognised after bifurcation. Learned Senior
Counsel submitted that the applicant owns Flat Nos. A/804 and
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A/904, but the petitioner has not referred to those flats anywhere
in the present petition. According to him, the applicant is the
original developer who had constructed Building 'A' and the
aforesaid two flats are its unsold flats, which continue to belong to
the applicant. Learned Senior Counsel further submitted that the
petitioner cannot invoke Section 9 of the Arbitration and
Conciliation Act in a manner which affects the rights of members
or non-members whose flats are not even included in the present
petition. According to him, the petitioner has no cause of action to
seek relief, either directly or indirectly, against persons whose
premises are neither covered by the Development Agreement nor
by the vacation notices or the present proceedings. Learned Senior
Counsel reiterated that the Development Agreement records only
63 members of the Society, whereas according to the order dated
20 September 2022 passed by the Deputy Registrar, the Society
actually consists of 73 members. He submitted that the said order
clearly supports the applicant's contention regarding the actual
strength of the Society. Learned Senior Counsel also submitted that
the applicant has been regularly paying maintenance charges to
respondent No.1 Society. According to him, the maintenance bills
and payment receipts produced along with the Interim Application
establish the applicant's continued rights and possession in respect
of the two flats. On the basis of the above submissions, learned
Senior Counsel prayed that no relief should be granted to the
petitioner in the present arbitration petition. He further requested
that the Interim Application filed by the applicant for intervention
and impleadment be allowed.
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REASONS AND ANALYSIS:
31. I have heard learned Senior Counsel and learned Advocates
appearing for all parties. I have also gone through the pleadings,
and documents relied upon by them. After considering the entire
material, it appears that the Court is required to see the
Development Agreement in full, the conduct of all parties after
execution of the agreement, the legal provisions governing
redevelopment and also keep in mind that powers exercised by this
Court under Section 9 of the Arbitration and Conciliation Act are
of limited nature. Therefore, every objection and every submission
has to be seen in its proper background before arriving at any
prima facie opinion.
32. The petitioner has approached this Court before
commencement of arbitration proceedings and seeks interim
protection under Section 9 of the Act. According to the petitioner,
respondent No.1 Society and the petitioner entered into a
Development Agreement dated 26 December 2023 which contains
an arbitration clause. It is the petitioner's case that the Society and
all members are required to follow the obligations arising from the
said agreement. The petitioner submits that after obtaining
Intimation of Approval from the Slum Rehabilitation Authority, it
became entitled to ask all members to vacate their respective
premises so that redevelopment work could start. According to the
petitioner, majority members have accepted the redevelopment
proposal and executed consenting declarations. However,
respondent Nos.2 to 26 have not vacated their premises and
because of their refusal, the redevelopment project has been
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stalled. It is therefore the petitioner's case that unless interim
protection is granted, the entire project will remain delayed even
though majority members are ready to proceed. The petitioner has
further submitted that under the Development Agreement wide
powers have been given to it for carrying out redevelopment.
According to the petitioner, the only restriction is that the agreed
area of the new flats to be allotted to the members should not be
reduced. It is submitted that the agreement permits utilisation of
available FSI, additional development potential, TDR,
amalgamation of neighbouring plots, revision of plans and
adoption of Government schemes which may become available
from time to time. Therefore, according to the petitioner, obtaining
approvals from the Slum Rehabilitation Authority and carrying out
joint redevelopment by amalgamating the adjoining Meena Society
plot is within the rights given under the Development Agreement
and does not amount to breach of the agreement.
33. The petitioner has placed reliance upon the conduct of
respondent No.1 Society and majority of its members after the
Intimation of Approval was received. According to the petitioner,
copies of the approvals were circulated amongst all members.
Thereafter, a Special General Body Meeting was convened where
members discussed the redevelopment proposal, considered the
sanctioned plans and also discussed enhancement of transit rent. It
is submitted that after those discussions the members approved the
redevelopment proposal and accepted enhancement of transit rent.
Thereafter, forty two out of sixty three members executed
declarations showing their willingness to participate in
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redevelopment. According to the petitioner, this shows that a small
section of members is opposing the redevelopment whereas the
majority has accepted the proposal. Therefore, the petitioner
submits that minority opposition cannot be permitted to stop
redevelopment which has received approval from the Society.
34. Respondent No.1 Society has supported the submissions
advanced by the petitioner. According to the Society, the
Development Agreement accepts the petitioner as Owner as well as
Developer and gives it authority to undertake redevelopment by
adopting any scheme. The Society submits that nowhere does the
agreement restrict redevelopment only through the Municipal
Corporation. According to the Society, the important aspect is that
every member should receive permanent alternate accommodation
and all benefits promised under the Development Agreement. So
long as those rights remain protected, the petitioner is free to
adopt any permissible statutory scheme for completing the
redevelopment. The Society has submitted that decisions relating
to redevelopment have been taken by the General Body of the
Society. According to the Society, appointment of the petitioner as
developer, approval of the Development Agreement, acceptance of
revised commercial terms, enhancement of transit rent and
acceptance of redevelopment plans have all received approval
from the General Body. Therefore the collective decision taken by
majority members cannot be defeated only because some members
are opposing redevelopment. It is submitted that once the General
Body has approved the project, the minority members cannot
prevent implementation of that decision.
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Scope of Jurisdiction under Section 9 of the Arbitration and
Conciliation Act and Nature of the Disputes Raised:
35. At this stage, it becomes necessary to understand the nature
of jurisdiction exercised by this Court under Section 9 of the
Arbitration and Conciliation Act. Proceedings under Section 9 are
not intended for deciding every dispute which may arise between
the parties. This Court is not expected to decide questions relating
to title, validity of resolutions. The purpose of Section 9 is to grant
appropriate interim protection wherever such protection becomes
necessary in aid of arbitration. Therefore, while considering the
present petition, this Court has to remain conscious that it is not
deciding the final rights of the parties.
36. The Division Bench of this Court in Pranav Constructions
Limited v. Priyadarshini Cooperative Housing Society Limited
Arbitration Appeal (L) No. 20093 of 2025 decided on 14 July 2025
has explained the scope of Section 9 in redevelopment matters. It
has been held that grievances of individual members regarding
validity of General Body resolutions, appointment of developer,
implementation of redevelopment, entitlement to additional area
or similar issues cannot be decided in proceedings under Section 9.
Such disputes are required to be taken before the competent forum
under the Maharashtra Co-operative Societies Act or before the
Civil Court, wherever such remedy is available. The Court
exercising jurisdiction under Section 9 is concerned with grant of
interim protection and not with adjudication of disputes between
the Society and its members. The Division Bench has observed that
where the Society and its members are bound by the Development
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Agreement, refusal of some members to perform their contractual
obligations may give rise to disputes capable of being referred to
arbitration. In such circumstances, the Court exercising powers
under Section 9 can consider grant of appropriate interim
protection. At the same time, the Court must remain careful that
interim relief granted at this stage should not amount to deciding
disputes which are required to be adjudicated by another forum
after trial.
37. Keeping the above principles in mind, the facts of the present
case now require careful examination. Different respondents have
raised several objections. Some respondents challenge the validity
of resolutions passed by the Society. Some question the authority
of the Managing Committee. Others contend that redevelopment
under Regulation 33(11), amalgamation of adjoining plots,
execution of Permanent Alternate Accommodation Agreements,
recognition of membership, pendency of proceedings before the
Co-operative Court, Commercial Court, statutory authorities and
claims relating to additional premises create impediments in
granting any relief under Section 9. Thus, numerous objections
have been raised from different angles and all of them require
consideration. However, merely because such objections have been
raised, it would not be proper at this stage to decide every one of
them. The issue which requires examination is whether these
objections are of such nature that they remove the jurisdiction of
this Court under Section 9 or whether they are disputes which are
required to be decided by other forum while this Court still retains
power to consider interim protection.
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38. The petitioner has submitted that every objection raised by
the respondents concerns either internal management of the
Society or claims of particular members. According to the
petitioner, such objections neither affect the existence of the
arbitration agreement nor destroy the binding nature of the
Development Agreement. Respondent No.1 Society has adopted
the same stand and has contended that these disputes cannot
prevent implementation of redevelopment approved by the
majority members. The contesting respondents have taken
different stand. According to them, the basis of the Development
Agreement has undergone a substantial change because
redevelopment is proposed under another statutory scheme and
because several contractual requirements have not been fulfilled
before issuance of the notices requiring members to vacate. It is
their case that these are not internal disputes of the Society.
According to them, these issues go to the root of the petitioner's
right to invoke Section 9 and therefore the petition is not
maintainable.
39. Thus, the controversy before this Court is not confined to the
question whether respondent Nos.2 to 26 are refusing to vacate
their premises. The issue appears to be whether the objections
raised by the respondents are disputes which must be decided
before some other forum while interim protection under Section 9
can be considered, or whether those objections strike at the
foundation of the present petition. It is this question which now
requires examination while considering the submissions advanced
on behalf of contesting respondent.
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Objection Regarding Authority of the Managing Committee to
Execute and Implement the Development:
40. The objections raised by respondent Nos.8, 10, 11, 12, 13,
14 and 15 are on four aspects. Firstly, they say that the Managing
Committee had no authority to execute and act upon the
Development Agreement. Secondly the redevelopment which is
proposed is not the same redevelopment which was earlier placed
before the members and accepted by them. Thirdly, it is their case
that before asking the members to vacate their flats, the petitioner
was required to complete obligations under the Development
Agreement, which has not been done. Lastly, they have relied upon
proceedings which are pending before the Co-operative Court, the
Deputy Registrar and other statutory authorities to submit that in
view of those proceedings, this Court should not grant any interim
relief under Section 9 of the Arbitration and Conciliation Act.
Therefore, according to these respondents, the petition deserves to
be rejected.
41. So far as the challenge to the authority of the Managing
Committee is concerned, learned counsel appearing for these
respondents submitted that the term of the Managing Committee
expired sometime in April 2021 and it ceased to have authority to
continue taking decisions on behalf of the Society. According to
them, once the tenure came to an end, every decision thereafter,
including execution of the Development Agreement, became
without authority in law. It is further submitted that complaints
regarding continuation of the Managing Committee are pending
before the Deputy Registrar and even directions have been issued
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for holding fresh elections. Therefore, according to these
respondents, decisions taken after expiry of the Committee's tenure
cannot create obligations against the members.
42. The petitioner as well as respondent No.1 Society have
opposed the above submissions. According to them, redevelopment
has not proceeded merely because of decisions taken by the
Managing Committee. They submit that the appointment of the
petitioner as developer, approval of the Development Agreement
and all other decisions have been approved by the General Body of
the Society. Therefore, even if certain disputes regarding the
Managing Committee are pending before the authorities, such
proceedings do not make resolution passed by the General Body
invalid nor do they stop the redevelopment process. Their
submission is that the will of the General Body cannot be ignored
only because questions regarding the Managing Committee are
pending.
43. Prima facie, merely because the tenure of the Managing
Committee is expired, it may not be possible to hold that every
subsequent act done by the Society becomes void. Whether the
Committee continued, whether elections ought to have been held
earlier, whether the office bearers could continue to discharge their
functions and what consequence follows from those facts are all
questions which arise under the Maharashtra Co-operative
Societies Act. Those issues are pending before the authorities. In
proceedings under Section 9, this Court is not expected to finally
examine those questions or record any findings upon them. Those
matters have to be left open for the authorities who are seized of
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them.
Objection that Redevelopment under Regulations 33(10) and
33(11) of the DCPR and Amalgamation of Plots Constitute a New
Project Requiring a Fresh Resolution:
44. The next objection raised by these respondents relates to the
change in the redevelopment scheme. Learned counsel submitted
that the Development Agreement contemplated redevelopment
through the Municipal Corporation. However, thereafter the
petitioner obtained approvals from the Slum Rehabilitation
Authority under Regulations 33(10) and 33(11) of the
Development Control and Promotion Regulations. According to
them, amalgamation of neighbouring plots, relocation of the
Permanent Transit Camp buildings and utilisation of different
statutory benefits have altogether changed the nature of
redevelopment. It is therefore submitted that this is no longer the
same project which was approved by the members and a fresh
resolution of the Society together with a addendum to the
Development Agreement became necessary before proceeding
further.
45. The petitioner has disputed this submission. According to the
petitioner, the Development Agreement contains several clauses
giving wide authority to adopt any Government scheme, utilise
every available development potential, amalgamate adjoining
plots, revise layouts and modify plans whenever necessary,
provided the area to be allotted to the members is not reduced.
Respondent No.1 Society has also supported this stand. According
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to the Society, after considering the revised proposal the General
Body accepted redevelopment through the Slum Rehabilitation
Authority and therefore there is no departure from the contractual
arrangement between the parties.
46. I have examined the relevant clauses of the Development
Agreement on which both sides have placed reliance. In my
opinion, the submission advanced on behalf of the respondents
cannot be accepted. The agreement does not merely authorise
redevelopment through one authority. On the contrary, the
definition of "Development Potential" is drafted in wide terms. It
includes every kind of FSI, TDR, additional development rights,
Government FSI, advantages arising from amalgamation of
neighbouring plots and all other development benefits available
under applicable laws, regulations and schemes including the
Development Control and Promotion Regulations, 2034. Thus, the
parties have agreed that the developer would be entitled to take
benefit of every development potential available during execution
of the project.
47. Clauses 3.4 and 3.5 also support the same interpretation.
Clause 3.4 authorises the Owners/Developers to utilise maximum
permissible FSI available under the Development Control
Regulations or any other applicable law. It further authorises
amendment of floor plans and layout plans of the plots and even
amalgamated plots, subject only to the condition that the area of
the members' new flats is not adversely affected without prior
approval of the Society. Clause 3.5 further provides that the
Owners/Developers shall be entitled to undertake and complete
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the project in such manner as they may deem fit. These clauses do
not indicate that redevelopment must remain confined to one
planning authority throughout the entire execution of the project.
48. Similar intention is reflected in Clause 15.9. Though
reference is made therein to obtaining IOD and payment of
premiums to the Municipal Corporation and other appropriate
authorities, the clause specifically records that the
Owners/Developers shall be entitled to opt for such Government
schemes as they deem beneficial and as may be permitted by the
various authorities. The expression "other appropriate authorities"
and the specific permission to adopt Government schemes cannot
be ignored while interpreting the contract. If the intention of the
parties was to prohibit redevelopment under any statutory scheme
other than the Municipal Corporation, nothing prevented them
from incorporating an express prohibition to that effect. No such
restriction is found in the Development Agreement.
49. Clauses 18.1 and 18.2 also make the position clear. Under
those clauses, the Society has conferred unrestricted rights upon
the developer to prepare, amend, modify and revise plans and
layouts and to obtain sanctions from the competent authorities.
The developer has also been given unrestricted right to utilise the
development potential and to carry out redevelopment in such
manner as it may deem fit in accordance with sanctioned plans
and approvals. Reading these clauses together, it becomes difficult
to accept the submission that every modification in planning or
every change in the route amounts to alteration of the
Development Agreement.
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50. Much emphasis was placed by the respondents upon the
proposal relating to Permanent Transit Camp buildings and
amalgamation of neighbouring plots. However, even these aspects
appear to have been contemplated by the contractual provisions.
The definition of Development Potential includes advantages
arising from amalgamation of neighbouring plots and utilisation of
every available development benefit under applicable law.
Therefore, merely because the petitioner has adopted a
redevelopment involving amalgamation or relocation of certain
components permitted under law, it cannot be concluded that a
new contract has come into existence.
51. The conduct of the parties after obtaining the Intimation of
Approval also assumes importance. The material placed on record
shows that after obtaining the approvals from the Slum
Rehabilitation Authority, the petitioner circulated the approvals to
the Society by communication dated 20 February 2026. The
Society circulated the same amongst its members. Thereafter, a
Special General Body Meeting was held on 26 February 2026 in
which the redevelopment proposal, sanctioned plans and the
questions raised by the members were discussed. It is also not
disputed that thereafter forty two members executed declarations
expressing their consent. No objection has been shown to have
been raised after circulation of the Intimation of Approval on the
ground that redevelopment through the Slum Rehabilitation
Authority was impermissible. This conduct of the parties also
weakens the respondents' submission.
52. Beyond making a submission that the nature of
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redevelopment has changed, no material has been placed on
record to demonstrate that the area of the permanent alternate
accommodation of the members has been reduced or that any
contractual benefit assured to the members under the
Development Agreement stands withdrawn. Mere change in the
statutory mechanism through which redevelopment is
implemented is not sufficient stall redevelopment approved by
majority of members, particularly when the contractual safeguards
in favour of the members continue to remain intact.
53. Therefore, I am unable to accept the submission that
redevelopment under Regulations 33(10) or 33(11),
amalgamation of neighbouring plots or adoption of statutory
benefits available under the Development Control and Promotion
Regulations, 2034 amounts to breach of the Development
Agreement. On the contrary, the clauses of the Development
Agreement indicate that the parties conferred flexibility upon the
petitioner to adopt such schemes and development benefits as may
become available during execution of the project. Therefore, the
contention that a fresh resolution of the Society and a registered
addendum became mandatory merely because redevelopment is
being implemented through the Slum Rehabilitation Authority
deserves to be rejected. I therefore hold that this objection raised
by the contesting respondents has no merit, at this stage.
54. Whether the redevelopment proposed falls within the four
corners of the Development Agreement or whether it amounts to
modification of the agreement is a matter which may require
detailed examination of the contractual terms, surrounding
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circumstances and evidence which may be led by the parties. Such
exercise falls within the jurisdiction of the Arbitral Tribunal. At the
present stage, this Court is only concerned with examining
whether the existence of such contractual dispute is sufficient to
deny interim protection.
Objection Regarding Non Execution of Permanent Alternate
Accommodation Agreements Before Issuance of Vacation Notices:
55. Respondent No.13 has raised objection regarding execution
of the Permanent Alternate Accommodation Agreement. According
to respondent No.13, under the terms of the Development
Agreement, execution of the Permanent Alternate Accommodation
Agreement in favour of every member was a necessary condition
before any notice calling upon the members to vacate their existing
premises could be issued. It is therefore submitted that since no
such Permanent Alternate Accommodation Agreement had been
executed or registered in favour of the members at the relevant
time, the petitioner had no right to issue the vacation notices and
no direction for handing over possession can be granted by this
Court. The petitioner has disputed the submission. It is pointed out
that in the Affidavit in Rejoinder a statement has been made that
the petitioner is ready and willing to execute the Permanent
Alternate Accommodation Agreement in favour of every member
before the respective member vacates his premises. According to
the petitioner, the agreements could not be executed earlier
because the Society had not completed the process of allotment of
individual permanent alternate flats and several members were not
cooperating in finalisation of that process. Respondent No.1
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Society has informed the Court that notice was issued for
convening a Special General Body Meeting for approving the draft
Permanent Alternate Accommodation Agreements and for
finalising allocation of the new flats. Copies of the proposed
agreements were also circulated to the members.
56. After considering the rival submissions, I do not find
substance in the objection raised by respondent No.13. The
Development Agreement has to be read as one complete document
and not by separating one clause from the remaining provisions.
The object behind execution of the Permanent Alternate
Accommodation Agreement is to secure the rights of every member
before possession of the existing premises is parted with. It cannot
be read in such manner so as to stop the redevelopment process
when the material on record shows that the petitioner has
expressed readiness to execute such agreements before each
member hands over possession and the Society was in the process
of finalising allotment of the flats.
57. It also cannot be ignored that execution of the Permanent
Alternate Accommodation Agreement depends upon identification
and allocation of the permanent alternate flat. If the allotment
process was under completion and the Society had initiated the
procedure for approval of the draft agreements, mere absence of
executed agreements on the date when the petition came to be
filed cannot render the redevelopment process illegal. The
contractual obligations of both parties are reciprocal. The
developer is required to execute the Permanent Alternate
Accommodation Agreement and the members are expected to
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cooperate in completion of the allotment process. One party
cannot refuse cooperation and rely upon the delay as a defence. In
my opinion, the apprehension expressed by respondent No.13 can
be taken care of by directing that no individual member shall be
required to hand over possession unless the petitioner first
executes and registers the Permanent Alternate Accommodation
Agreement in favour of such member in accordance with the
Development Agreement and complies with its obligations
regarding transit rent, hardship compensation and other
contractual benefits. Once such protection is available, the
objection raised by respondent No.13 does not survive.
58. Accordingly, I hold that the non-execution of the Permanent
Alternate Accommodation Agreements does not invalidate the
proceedings under Section 9 nor does it disentitle the petitioner
from seeking interim relief. At the same time, the petitioner shall
remain bound to execute and register the Permanent Alternate
Accommodation Agreement in favour of every member before
taking over possession of that member's premises. Subject to such
compliance, the objection raised by respondent No.13 deserves to
be rejected.
Objection Regarding Validity of the Minutes and Resolutions of the
Special General Body Meeting:
59. Another submission which has been pressed is that the
minutes of the Special General Body Meeting held on 26 February
2026 cannot be treated as a valid resolution of the Society.
According to the contesting respondents, those minutes were
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neither circulated in accordance with law nor confirmed in any
subsequent General Body Meeting. Therefore, according to them,
those minutes cannot amount to approval of the revised
redevelopment proposal or acceptance of redevelopment through
the Slum Rehabilitation Authority. The petitioner and respondent
No.1 Society have disputed the above contention. According to
them, the General Body was informed about the approvals
obtained by the petitioner, the revised terms were discussed,
transit rent was enhanced, and all doubts raised by the members
were answered. Thereafter, majority members accepted the
proposal and executed declarations expressing their consent to the
redevelopment. Thus, according to the petitioner and the Society,
the minutes reflect the decision taken by the members.
60. Whether the minutes satisfy procedural requirement
prescribed under the Maharashtra Co-operative Societies Act and
the bye-laws of the Society appears to be an issue falling within
the jurisdiction of the competent authorities who examine validity
of General Body proceedings. It is also not disputed that the
respondents have challenged several General Body resolutions
before the Co-operative Court and other authorities. Those
proceedings are pending. Therefore, this Court may not be
required to decide validity of those resolutions.
Objection Based on Pendency of Proceedings:
61. The respondents have relied upon pendency of proceedings
before the Co-operative Court, the Deputy Registrar and the
Divisional Joint Registrar. According to them, once those
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proceedings are pending, this Court should not exercise powers
under Section 9 till those authorities decide the disputes raised
before them. They submit that grant of any interim relief may
prejudice their rights in those proceedings. In my opinion, mere
pendency of proceedings before another forum may not create a
bar against exercise of powers under Section 9. Unless there is
order restraining implementation of the Development Agreement
or prohibiting continuation of redevelopment, pendency of
proceedings may not determine the rights of the parties.
Objection Based on Internal Disputes Concerning Shareholding
and Management of the Petitioner Company:
62. Respondent Nos.14 and 15 have relied upon disputes
relating to the shareholding pattern and ownership of the
petitioner company. According to them, because of those disputes,
the Development Agreement becomes incapable of enforcement.
They submit that unless those disputes are resolved, no relief
should be granted in favour of the petitioner. The petitioner has
opposed this submission by contending that disputes relating to
the internal shareholding of the petitioner company have no
connection with the arbitration agreement executed between the
petitioner and respondent No.1 Society. It is submitted that no
Court has passed any interim order restraining the petitioner from
acting under the Development Agreement. Therefore, according to
the petitioner, such disputes cannot prevent it from enforcing its
contractual rights arising under the Development Agreement.
Prima facie, disputes concerning ownership or internal
management of the petitioner company appear to stand on a
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different footing from the contractual obligations arising under the
Development Agreement executed with respondent No.1 Society.
Unless those proceedings result in restraint against the petitioner,
it may not be possible to hold that the Development Agreement
has become unenforceable merely because such proceedings are
pending.
63. Thus, the objections raised by respondent Nos.8, 10, 11, 12,
13, 14 and 15 raise issues requiring examination by the competent
forums before whom those disputes are pending or may be raised
but are not sufficient to deny exercise of power by this Court under
Section 9 of the Arbitration and Conciliation Act.
Objection Regarding Additional Flats, Waitlisted Members and
Alleged Membership Rights:
64. Another objection has been raised by respondent Nos.19 and
21. According to them, apart from the flats which are subject
matter of the present petition, they are owners or persons entitled
in respect of certain additional flats situated in the Society
building. It is their submission that those flats have not been
considered while preparing the redevelopment proposal and
therefore unless their rights in respect of those premises are
protected, the redevelopment cannot be permitted to proceed.
According to them, demolition of the existing building would
prejudice their rights in additional premises and therefore the
petitioner cannot seek any interim relief under Section 9. The
petitioner as well as respondent No.1 Society have disputed the
above contention. According to them, the claim made by
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respondent Nos.19 and 21 does not relate to recognised flats
forming part of the redevelopment. It is pointed out that the so
called premises are small units of approximately 100 square feet. It
is submitted that these units are lying vacant and are not occupied
by respondent Nos.19 and 21. According to the petitioner, those
units do not have doors, windows, water connection or electricity
connection and cannot be treated as habitable flats. It is pointed
out that photographs of these units were produced before the
Court during the course of hearing. The petitioner has submitted
that respondent Nos.19 and 21 have never been recognised by the
Society as members in respect of those alleged additional units.
According to the petitioner, the Development Agreement proceeds
on the basis of recognised membership of the Society and records
that claims of certain waitlisted members would remain separate
and would be dealt with by the Society and at its own costs. It is
therefore submitted that assuming respondent Nos.19 and 21
assert some rights in those additional units, such dispute is
between them and the Society and cannot become a ground to
stop the redevelopment.
65. I find substance in the submission advanced on behalf of the
petitioner. The material placed on record indicates that the petition
concerns enforcement of obligations arising under the
Development Agreement executed between the petitioner and
respondent No.1 Society. The dispute sought to be raised by
respondent Nos.19 and 21 in respect of the additional units stands
on different footing. That dispute is regarding recognition of their
rights as members or owners in respect of those premises. Such
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issue does not arise from the obligations undertaken by the
petitioner under the Development Agreement. The Development
Agreement assumes significance in this regard. Recital C read with
the relevant recital dealing with waitlisted members records that
certain claims regarding additional members or waitlisted persons
exist and that such claims shall be dealt with by the Society at its
own costs. Therefore, while executing the Development
Agreement, the parties were conscious that disputes relating to
those alleged members were existing and agreed that such
disputes would remain outside the obligations undertaken by the
developer. Once such arrangement has been incorporated in the
Development Agreement, respondent Nos.19 and 21 cannot insist
that those disputes must be decided before redevelopment can
commence. The respondents have not placed any material before
this Court showing that they are in settled possession of those
additional units. On the contrary, the case of the petitioner and the
Society is that possession of those units remained with the Society
and that the alleged units are lying vacant. This factual position
has not been displaced by any material placed before this Court.
Even assuming rival claims exist regarding those premises, such
disputed questions of possession, ownership and membership
cannot be adjudicated in proceedings under Section 9 of the
Arbitration and Conciliation Act.
66. Learned counsel appearing for respondent Nos.19 and 21
argued that unless those additional units are recognised for
redevelopment, prejudice would be caused to them. I am unable to
accept this submission. If respondent Nos.19 and 21 possess any
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legal right in respect of those alleged units, such right is not
extinguished merely because redevelopment proceeds. They
remain free to establish their alleged entitlement before the
competent authority or forum in accordance with law. If they
succeed in establishing such rights, appropriate reliefs can be
worked out against the Society in accordance with the
adjudication. Therefore, mere pendency of dispute cannot operate
as a bar against the redevelopment process.
67. It is important to note that respondent Nos.19 and 21 are
recognised by the Society in respect of the flats forming part of the
redevelopment. Their objection does not relate to those recognised
flats. Their objection is regarding certain additional units. Thus
they seek to utilise an independent membership dispute as a
ground for preventing implementation of the Development
Agreement in respect of other members of the Society. Such course
cannot be permitted. A dispute relating to an individual's
additional entitlement cannot be allowed to stall redevelopment
which has been approved by the members of the Society.
68. The submission of the petitioner that these claims relate to
waitlisted membership cannot be ignored. Whether respondent
Nos.19 and 21 are entitled to recognition as members in respect of
those units, whether share certificates have been issued, whether
those units constitute flats and whether any enforceable right
survives in their favour are all issues requiring detailed
examination of the Society records, and other evidence. Such
adjudication falls within the jurisdiction of the competent forum
under the Maharashtra Co-operative Societies Act or any other
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forum having jurisdiction. Those questions cannot be decided on
affidavits filed in proceedings under Section 9.
69. For all these reasons, I am of the view that the objection
raised by respondent Nos.19 and 21 regarding the exclusion of
additional flats from the redevelopment has no merit so far as the
present petition is concerned. The said dispute is a separate
dispute relating to membership and alleged ownership. It does not
affect the enforceability of the Development Agreement executed
between the petitioner and respondent No.1 Society. Consequently,
it cannot be permitted to obstruct the redevelopment process.
Respondent Nos.19 and 21 will be at liberty to pursue their
remedies before the competent forum in accordance with law.
Objection that All Persons Claiming Rights in Building A are
Necessary Parties and that the Petition Suffers from Non Joinder:
70. The respondents have argued that even if the petition seeks
relief against certain specified respondents, the effect of the order
would be demolition of the entire Building 'A'. According to them,
once the building is demolished, every person who is occupying
any portion of that building, whether he is made a party or not,
will be affected. It is therefore submitted that unless every person
claiming any right in the building is before the Court and has been
given an opportunity of hearing, no order permitting demolition
should be passed. According to the respondents, passing such
order in absence of affected persons may result in prejudice to
persons who are not before the Court. The petitioner has argued
that the present proceedings arise under Section 9 of the
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Arbitration and Conciliation Act and the petitioner is seeking
interim protection only against those members who are refusing to
perform their obligations under the Development Agreement.
According to the petitioner, every possible dispute relating to every
occupant of the building cannot be brought within the scope of
one petition under Section 9. It is submitted that if any person
claims an independent right over any premises, such person is free
to take recourse to the remedies available under law. Those
independent disputes cannot become a ground to prevent
implementation of the redevelopment approved by the Society.
71. After considering the rival submissions, I do not find merit in
the objection raised by the respondents. It is true that demolition
of a building affects every person who has a interest in that
building. However, that principle cannot be stretched to mean that
a redevelopment approved by the Society can not proceed unless
every claimant asserting some right is brought before the Court in
proceedings under Section 9. Such interpretation would make
execution of redevelopment projects impossible because disputes
of different nature concerning different persons may continue for
years.
72. The petition is founded upon the obligations arising from the
Development Agreement executed between the petitioner and
respondent No.1 Society. The petitioner seeks enforcement of those
obligations against the persons who are bound by the
Development Agreement and whose refusal to vacate is
obstructing the redevelopment. The scope of the present
proceedings is confined to that relationship. It is not a
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representative proceeding for deciding title, membership or
possession of every person who may claim some interest in the
building. It deserves to be noticed that law does not require that
every dispute connected with the property must attain finality
before redevelopment can commence. If such principle is accepted,
even a doubtful claim raised by one person would be sufficient to
stop the entire redevelopment for an indefinite period. Such
consequence would defeat the object of collective redevelopment
undertaken by a co-operative housing society. At the same time, it
is true that the rights of persons who are not parties before the
Court cannot be decided behind their back. However, the present
proceedings do not decide any such rights. If any person, who is
not a party to the petition, claims an independent title,
membership or any other right in respect of any premises, such
person remains free to establish those rights before the competent
forum. Nothing in the present proceedings concludes such rights.
Therefore, the apprehension that rights of third parties would
stand defeated is without substance.
73. It is also important to notice that several respondents have
stated that proceedings are pending before different forums
regarding membership disputes, ownership claims and other
issues. Those proceedings will continue on their own merits.
Passing an order under Section 9 in the present petition does not
amount to adjudication of those disputes. Therefore, no prejudice
can be said to have been caused merely because those persons are
not parties to the present proceedings.
74. The submission of the petitioner that only those respondents
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who are obstructing redevelopment have been proceeded against
needs to be accepted. Interim protection under Section 9 is
granted according to the immediate dispute. The Court is not
expected to enlarge the proceedings by directing the petitioner to
implead every person who may have some claim over the property,
particularly when those claims do not arise from the arbitration
agreement. The respondents have not been able to show that
existence of necessary party, without whose presence no effective
order can be passed. A distinction has to be maintained between a
person whose rights may be available and a person whose
presence is necessary for deciding the dispute arising under the
Development Agreement. The former may pursue his remedies
separately. The latter becomes necessary for adjudication in
proceedings under Section 9. In the present case, the respondents
have failed to establish that claimant falls in the second category.
For these reasons, I am unable to accept the submission that no
order under Section 9 can be passed unless person claiming some
right in Building 'A' is impleaded before this Court. The rights of
non-parties are not adjudicated by the present order. They remain
free to pursue their remedies in accordance with law. Those
disputes cannot be permitted to obstruct redevelopment approved
by the Society. The objection raised by the respondents is,
therefore, rejected.
Objection Regarding Total Number of Members and Validity of
Majority Approval:
75. Another objection pressed by respondent No.13 relates to the
total number of members of respondent No.1 Society. According to
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him, the Development Agreement wrongly proceeds on the basis
that the Society has sixty-three members, whereas the order
passed by the Deputy Registrar records that the Society consists of
seventy-three members. Therefore, the basis on which majority
support is claimed by the petitioner is incorrect. The petitioner and
the Society have denied the above submission. According to them,
the figure of sixty-three members refers to those members who are
recognised under the Development Agreement for the
redevelopment property. They submit that the remaining claims
relate either to waitlisted members or to persons whose
membership is disputed and whose rights have been kept open
under the Development Agreement. Therefore, those disputed
claims cannot be counted while determining majority support for
redevelopment.
76. This Court is unable to accept the contention of respondent
No.13 that merely because there is dispute regarding total number
of members, it follows that the majority relied upon by petitioner
becomes non-existent. The controversy is not only about numbers.
Dispute is regarding status of certain persons who claim
membership. Unless it is first decided that such persons are
entitled to be treated as members, they cannot be added while
calculating majority required for redevelopment. This issue
regarding membership needs to be decided by authorities under
the Maharashtra Co-operative Societies Act. Such proceedings are
intended to examine whether persons are entitled to become
members. These are questions requiring examination of records of
the Society and other evidence. Such enquiry cannot be
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undertaken in a petition under Section 9 where the Court exercises
limited jurisdiction. The Development Agreement does not ignore
existence of claims. On the contrary, it proceeds on basis of
recognised members and at the same time keeps disputes relating
to other claimants open for adjudication. Therefore, prima facie it
cannot be said that petitioner has suppressed other claims.
Whether those claims succeed or fail is a matter to be decided
before the competent forum. Till such adjudication takes place,
this Court cannot proceed on assumption that every claimant has
acquired status of a member.
77. Even otherwise, the issue before this Court is not whether
membership of Society is sixty-three or seventy-three. The limited
question is whether existence of such dispute is sufficient to non-
suit the petitioner. In my prima facie opinion, the answer has to be
in the negative. A dispute regarding status of some members
cannot render every resolution passed by the Society ineffective,
nor can it destroy the relationship created under the Development
Agreement. Unless the competent forum records a finding that the
resolutions are invalid or that the composition of the Society stood
different in law, this Court cannot proceed on assumption that
majority approval never existed. For these reasons, I am not
inclined to accept the submission of respondent No.13 that the
petition must fail only because there is dispute regarding whether
the Society consists of sixty-three or seventy-three members.
Objection Based on Earlier Development Agreement, Pending
Commercial Suit and Alleged Rights of the Previous Developer
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78. Respondent Nos.24, 25 and 26 have made submissions
regarding the redevelopment agreement executed in favour of
respondent No.24. According to them, respondent No.24 had
entered into a Tripartite Agreement in the year 2006, had obtained
sanctioned plans and thereafter filed Commercial Suit No.409 of
2017 after termination of that agreement. It is submitted that
orders passed by the Commercial Court in those proceedings make
all further steps taken by the petitioner subject to the final orders
which may be passed in that suit. Therefore, according to them,
the petitioner cannot claim unrestricted rights to proceed with
redevelopment. The petitioner has not disputed that the
Commercial Suit is pending. However, it is submitted that
respondent No.24 has not obtained any injunction restraining
either the Society or the petitioner from proceeding further.
According to the petitioner, mere pendency of litigation without
any prohibitory order does not stop exercise of rights arising under
the present Development Agreement. Therefore, according to the
petitioner, the Commercial Suit cannot defeat the present petition.
In my opinion, prima facie, mere pendency of a Commercial Suit
may not make every transaction entered into by the Society invalid
unless there exists order operating against the parties.
79. A major part of the arguments advanced by respondent
Nos.24, 25 and 26 concerns redevelopment under Regulation
33(11) of the Development Control and Promotion Regulations.
According to them, the Development Agreement originally
contemplated redevelopment through the Municipal Corporation
and not through the Slum Rehabilitation Authority. They submit
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that construction of Permanent Transit Camp buildings, shifting of
those buildings under a clubbing scheme, amalgamation of
adjoining plots and adoption of a different redevelopment model
have materially altered the original project approved by the
Society. According to them, what is now being implemented is not
the same redevelopment which was earlier accepted.
80. Respondent Nos.20, 22 and 23 have adopted the submissions
advanced on behalf of respondent Nos.19, 21, 24, 25 and 26.
Similarly, respondent No.26 has adopted those submissions. Thus,
the objections raised by respondent Nos.19 to 26 revolve around
the effect of membership claims and the necessity of obtaining
approvals. These issues require detailed examination. However,
they are matters to be decided before the appropriate forum
Analysis of the Submissions of the Intervenor M/s. Saboo and
Varun:
81. An Interim Application has also been filed by M/s. Saboo
and Varun seeking intervention and impleadment in the present
proceedings. According to the applicant, though the petitioner is
seeking orders which may result into demolition of the entire
Building 'A', the applicant has not been joined as a party even
though it claims ownership over Flat Nos. A/804 and A/904
situated in the same building. It is submitted that if demolition is
permitted, the rights claimed by the applicant in those two flats
will also get affected. Therefore, according to the applicant, it is
both a necessary as well as proper party and without hearing it no
effective order should be passed. The applicant has submitted that
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it was the original developer who had constructed Building 'A' and
that the above two flats still continue to remain its unsold
premises. It is also submitted that the applicant has continued to
remain in possession of those flats, has been paying maintenance
charges and other outgoings and since the year 2007 those
premises have been given on leave and licence basis. According to
the applicant, all these facts are within the knowledge of both the
petitioner and respondent No.1 Society. The grievance made by the
applicant is that no notice has been issued to it and no proceedings
have been initiated against it. According to the applicant, while
seeking an order which may permit demolition of the building, the
petitioner has not disclosed the existence of the applicant's rights
in the aforesaid two flats. Therefore, according to the applicant,
the petition suffers from non-joinder of necessary parties and on
that ground also the reliefs claimed by the petitioner deserve to be
refused.
82. According to the petitioner, the present petition is filed
against those persons whose refusal to vacate is creating
obstruction in implementation of the redevelopment project. It is
submitted that the present proceedings are not intended to decide
every dispute relating to every premises situated in the building.
According to the petitioner, merely because some claims are raised
in respect of certain flats, the same cannot defeat a petition
seeking interim protection against persons who are bound by the
Development Agreement and who are to be acting contrary to its
terms.
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83. In my prima facie opinion, mere assertion by the applicant
that it has rights in two flats does not lead to the conclusion that
the entire petition under Section 9 becomes not maintainable. If
the applicant is able to establish rights in those premises, such
rights cannot be defeated because redevelopment is undertaken.
Redevelopment does not extinguish ownership rights. Whatever
rights the applicant may establish before the competent forum
would continue to remain available in accordance with law.
Therefore, merely because this Court proceeds to consider the
present petition, it does not follow that the applicant loses any
remedy available to it.
84. The argument that the petition is liable to be dismissed for
non-joinder of the applicant cannot be accepted. The petitioner has
sought reliefs against specified respondents who, according to it,
are obstructing redevelopment and whose occupation is covered by
the present dispute. The applicant is not a party to the
Development Agreement. It also does not claim that it executed
the Development Agreement or agreed to the arbitration clause
contained therein. Its claim is founded upon an independent
source. Therefore, the controversy raised by the applicant is
different from the dispute presently raised between the petitioner
and respondent No.1 Society. In this regard, the distinction
recognised by this Court in redevelopment matters deserves notice.
Where a person is a stranger to the arbitration agreement and
asserts title, such claim cannot be adjudicated in proceedings
under Section 9. Such independent claim does not render every
petition under Section 9 not maintainable. The Court is required to
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examine whether effective interim relief can be granted against
parties to the arbitration agreement while leaving the independent
claims of third parties to be decided before the appropriate forum.
In the facts of the present case, the applicant has not demonstrated
that any relief is claimed in the petition against Flat Nos. A/804
and A/904. The apprehension expressed by the applicant is that
demolition of the building may incidentally affect the rights. Such
apprehension cannot justify dismissal of the entire petition. At the
highest, it requires that whatever rights are claimed by the
applicant shall abide by the decision of the competent forum.
Therefore, I am unable to accept the submission that the petition
deserves to fail merely because M/s. Saboo and Varun claims rights
in Flat Nos. A/804 and A/904.
Objection that the Existing Building Does Not Require
Redevelopment:
85. The applicant has submitted that Building 'A' is sound, is less
than thirty years old and does not require demolition. According to
the applicant, the cement concrete structure has been maintained
over the years and therefore there is no necessity for
redevelopment. On that basis it is submitted that the foundation of
the redevelopment proposal is doubtful. The petitioner has
disputed the above submission and has relied upon the resolutions
passed by the Society approving redevelopment. Respondent No.1
Society has also submitted that with passage of time the buildings
have deteriorated and the members have taken a decision to
undertake redevelopment after considering all aspects. According
to the Society, once the General Body has resolved to redevelop the
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property, individual opinions regarding the condition of the
building cannot override the decision taken by the majority.
86. The above submissions show that differences exist between
the parties regarding the necessity of redevelopment. However,
whether redevelopment is beneficial, whether reconstruction
should be undertaken or whether the building should continue are
matters which fall within the domain of the General Body of the
Society. Unless the decisions taken by the General Body are set
aside by a competent forum, those decisions continue to operate
and cannot be ignored merely because some members hold a
different opinion.
Consolidated Conclusion on the Effect of the Above Objections in
Proceedings Under Section 9:
87. Thus, upon overall consideration of the submissions
advanced by the intervenor as well as the remaining respondents,
it becomes clear that several disputes continue to survive between
the parties. Some disputes relate to membership. Some concern
validity of resolutions. Others involve interpretation of clauses and
legal consequences arising from proceedings pending before
different forums. All these disputes require adjudication by the
competent forums before whom they are pending or before whom
they may be instituted.
88. Having considered the matter in its entirety, this Court is
satisfied that the objections raised by the contesting respondents
relate to disputes which are required to be adjudicated before the
competent authorities, the Civil Court or the Arbitral Tribunal.
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Those disputes cannot receive final adjudication in proceedings
under Section 9. Their pendency is not sufficient to dismiss the
present petition. The conclusion of this Court does not proceed on
the footing that every contention raised by the respondents is
incorrect. The conclusion is based upon the overall assessment that
the objections urged lie outside the limited jurisdiction exercised
by this Court under Section 9 and that all such issues remain open
for adjudication before the forums competent to decide them. The
present proceedings are restricted to consideration of interim
protection in aid of arbitration and cannot be converted into
proceedings deciding every dispute relating to the redevelopment
project.
89. In view of the foregoing discussion, and upon overall
assessment of the material record, the following order is passed:
(i) The Arbitration Petition is partly allowed;
(ii) Pending commencement and conclusion of the arbitral
proceedings arising out of the Development Agreement
dated 26 December 2023, respondent Nos.2 to 26 are
directed to hand over vacant and peaceful possession of Flat
Nos. B/3, B/8, B/11, B/13, B/19, B/20, B/36, A/303, A/404,
A/502, A/503, A/601, A/701, A/702, A/703, A/704, A/801,
A/802, A/803, A/1002 and A/1003 situated in respondent
No.1 Society at Somnath Lane, Off Hill Road, Bandra (West),
Mumbai 400050, to the petitioner within a period of four
weeks from date of compliance of clause (iii) and (vi) below
by the petitioner;
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(iii) Before seeking possession from any individual
respondent, the petitioner shall execute and register the
Permanent Alternate Accommodation Agreement in favour of
such respondent/member in accordance with the
Development Agreement. The petitioner shall also pay or
secure payment of transit rent, hardship compensation and
every other monetary benefit payable under the
Development Agreement up to the date of handing over
possession;
(iv) In the event any respondent fails to hand over
possession within the period stipulated above, the Court
Receiver, High Court, Bombay, is appointed Receiver in
respect of the aforesaid premises with all powers under
Order XL of the Code of Civil Procedure;
(v) The Court Receiver shall first issue a notice of seven
days to the defaulting respondent calling upon such
respondent to hand over possession;
(vi) If possession is still not handed over, the Court Receiver
shall be entitled to take physical possession of the concerned
premises, with police assistance if necessary, including by
breaking open the locks, and thereafter hand over possession
to the petitioner for the purpose of redevelopment;
(vii) If any respondent refuses or fails to execute the
Permanent Alternate Accommodation Agreement after the
petitioner has complied with all contractual requirements
and has tendered the agreement for execution, the Court
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Receiver is authorised to execute and register the Permanent
Alternate Accommodation Agreement on behalf of such
defaulting respondent, so as to give effect to the
Development Agreement;
(viii) The petitioner is permitted to deposit with the Court
Receiver the transit rent, hardship compensation and other
monetary benefits payable to any respondent who refuses to
accept the same or whose entitlement is under dispute. Such
deposit shall constitute sufficient compliance with the
petitioner's obligation to tender those payments, subject to
final adjustment in accordance with the arbitral award or
any competent proceedings;
(ix) Upon completion of redevelopment, the petitioner shall
hand over possession of the redeveloped permanent
alternate accommodation of the defaulting respondents to
the Court Receiver, who shall deliver possession to the
persons found entitled thereto in accordance with the
Development Agreement and subject to the outcome of any
pending proceedings concerning membership, title or
entitlement;
(x) Pending delivery of actual possession as per clauses (ii)
or (iv), respondent Nos.2 to 26, their servants, agents and
persons claiming through them are restrained from creating
any third party rights, transferring, alienating, encumbering,
parting with possession of, or otherwise dealing with the
aforesaid existing flats or the corresponding permanent
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alternate accommodation to be allotted in lieu thereof in a
manner prejudicial to the rights created under the
Development Agreement;
(xi) It is clarified that the disputes relating to validity of the
resolutions of the Society, legality of the Managing
Committee, membership disputes, waitlisted members,
ownership of additional flats, proceedings pending before
the Co-operative Court, Deputy Registrar, Divisional Joint
Registrar, Commercial Court or any other competent forum,
and every other independent dispute raised by the contesting
respondents are expressly kept open. None of the
observations contained in this judgment shall be construed
as deciding those disputes on merits;
(xii) It is further clarified that all findings recorded in this
judgment are prima facie and confined to adjudication of the
present petition under Section 9 of the Arbitration and
Conciliation Act, 1996. The Arbitral Tribunal and every other
competent forum shall decide the disputes independently
and without being influenced by any observations made
herein;
(xiii) The petitioner shall invoke arbitration within ninety
days from the date of this order;
(xiv) There shall be no order as to costs.
(xv) All pending Interim Applications, if any, stand disposed
of.
(AMIT BORKAR, J.)
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