Dismissal Of Plea U/S 8 Of A&C Act Amounts To Res Judicata; S.11 Court Cannot Refer Parties To Arbitration: Delhi High Court

The Delhi High Court bench of Justice Purushaindra Kumar Kaurav, while dismissing a Section 11 petition under the A&C Act, observed that dismissing a Section 8 application under the A&C Act amounts to res judicata. The Section 11 Court cannot refer the parties to Arbitration if the order dismissing Section 8 is not set aside or interfered with. A Collaboration Agreement dated 26.11.2018 was entered into by the parties, and the Petitioner was required to carry out the construction. In lieu of the construction, the possession and ownership of the second floor were to be handed over to the Petitioner. The said construction was carried out; however, the Respondent was not handing over the possession and ownership of the property. A civil suit was initiated by Respondent No. 1 seeking a decree of permanent injunction against the Petitioner. The civil suit was instituted before the Court of the Civil Judge-01, Tis Hazari Courts (West), New Delhi. The Petitioner was served with the summons. Subsequently, the Petitioner filed a Section 8 petition. The said petition was rejected vide order dated 06.05.2023. The appeal against the order was also dismissed vide order 18.04.2023, observing that allowing the Section 8 petition and referring the parties to Arbitration would amount to splitting the parties, and such reference to Arbitration is not permissible under the A&C Act. It was the case of the Petitioner that the issues involved in the civil suit and Section 11 are different. The civil suit was instituted for a decree for permanent injunction by the Respondent No. 1, and the Petitioner seeks the possession of the second floor of the constructed property. Therefore, the Section 8 application was rejected by the Civil Judge on technical grounds. The dismissal does not bar the Petitioner from taking recourse u/s 11 of the A&C Act. It was the case of the respondents that in light of the Civil Judge dismissing the Section 8, and the Appellate Court upholding the judgment of the Civil Judge, the Section 11 petition is not maintainable. In the above terms, the Court dismissed the Section 11 petition and vacated the previous order passed on 06.05.2025. Case Name: Surender Bajaj v. Dinesh Chand Gupta and Ors.Citation: 2025 LiveLaw (Del) 1032 Case Number: ARB.P. 1076/2025 Counsel for the Petitioner: Mr. Kartik Jasra, Mr.Shivam Jasra, Ms. Vidhi Sharma and Mr. Nakul Khanna, Advs. Counsel for the Respondent: Mr. Tushar Mahajan and Mr. Tanmay, Advs. Click Here To Read/Download The Order

Dismissal Of Plea U/S 8 Of A&C Act Amounts To Res Judicata; S.11 Court Cannot Refer Parties To Arbitration: Delhi High Court

Mohd Talha Hasan

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