w w w . L a w y e r S e r v i c e s . i n



M/S. Annai Builders Real Estates Pvt. Ltd Rep By Its Special Officer Bk. Shanmugham & Another v/s G.B. Sarath Kumar & Another

    A.Nos.3773 of 2012 and 4220 of 2012

    Decided On, 30 October 2012

    At, High Court of Judicature at Madras

    By, THE HONOURABLE MS. JUSTICE K.B.K. VASUKI

    For the Petitioners: -------- For the Respondents: ---------



Judgment Text

A.No.3773 of 2012 is filed by the owner of the properties for appointment of Advocate Commissioner to inspect and file a report on the construction completed till date and to note down the physical features of the schedule mentioned properties with the assistance of licensed Civil Engineer. Whereas, A.No.4220 of 2012 is filed by the building contractor to dismiss the application for appointment of Advocate commissioner.

2. The parties, for convenient sake, are referred to, as per their rank in A.No.3773 of 2012.

3. Few facts, which are relevant for consideration herein, are as follows:

The applicant/owner of the properties proposed to develop a housing project upon the lands in question and engaged the respondent/contractor to do the construction work. Both the parties entered into a construction agreement on 2.2.2011 subject to terms and conditions. Admittedly part of the construction work was completed. In the course of the same, dispute arose between the parties, leading in termination of construction agreement by the applicant/owner, resulting in stoppage of construction work. While according to the applicant/owner, the work completed till date is not only defective, but also not commensurate with the amount received by the respondent/contractor, according to the respondent/contractor, it is the applicant/owner, who is due and payable huge amount to the building contractor and the grievances raised by the applicant/owner regarding defective nature of construction and excess payment for the construction completed are contrary to actual state of affairs.

4. Regarding the nature of the dispute raised between the parties, the same need not be elaborately dealt with in the present application, as the same is the subject matter of arbitration, to which, the parties agreed to refer the dispute. Pending appointment of arbitrator, the applicant/owner has come forward with two applications (i)A.No.3773 of 2012 and (ii)O.A.732 of 2012. While the relief sought for in A.No.3773 2012 is for appointment of advocate commissioner to inspect the properties and file a repot and to note down the physical features of the schedule mentioned properties with the assistance of a licensed Civil Engineer, the relief sought for in O.A.732 of 2012 is for interim injunction restraining the respondent or any body claiming through them from interfering with the construction work to be carried on in the schedule mentioned properties by engaging third party/contractors by the applicant/owner.

5. This Court, at the initial hearing of both the applications, having satisfied with the reasons set out in the affidavit filed in support of the application and the circumstances under which, the applicant approached this court for the reliefs stated supra and having regard to the vast extent of the properties i.e. 46 plots on eastern and western portion respectively, thought fit to appoint two Advocate commissioners to visit the property to measure the constructed and the remaining area with the help of two licensed Civil Engineers. In pursuance of the order of this Court, the Advocate Commissioners, after giving due intimation to the parties, reached the schedule mentioned properties, but the Advocate Commissioners were unable to execute the warrant, in view of the objections raised by the respondent/contractor. The respondent/contractor thereafter filed (i)A.No.4220 of 2012 to dismiss the application for appointment of advocate commissioner and (ii)OA.789 of 2012 for an order of ad interim injunction restraining the owner/applicant from interfering with the possession of the respondent/contractor including the work allotted to the respondent/contractor.

6. The applicant/owner has come forward with the aforementioned applications for the reliefs stated supra on the ground that in pursuance of the termination of construction agreement, the respondent/contractor is duly put on notice about the intention of the applicant to carry on and to complete left over work by engaging third party contractor at the costs and responsibility of the respondent, as the applicant is answerable to third party individuals, who are the allottees of the flats within the specified time and unless and until the extent of the work completed by the respondent/contractor is ascertained, the applicant/owner may not be able to carry on with further construction work of the remaining uncompleted area and any failure to ascertain the nature and extent of the constructed area is, when further action is taken by the applicant/owner likely to give rise to further dispute between the parties and the same can be ascertained only through appointment of advocate commissioner, whose report is likely to help the parties to adjudicate the issue in effective manner.

7. Whereas, the learned counsel for the respondent/contractor opposed the reliefs sought for by the applicant mainly on the ground that this court is, under section 9 of the Arbitration and Conciliation Act, not empowered to appoint Advocate Commissioner to collect evidence as the same may not be attached any evidenciary value in the arbitration proceedings and under section 26 of the Arbitration and Conciliation Act, the same relief can be sought for before the Arbitrator and the Arbitral Tribunal is equally empowered to call for expert opinion and expert report. The next objection, which is seriously urged before this court on the side of the respondent is about the selection of licensed Civil Engineers to assist the Advocate Commissioners and the manner in which the Advocate Commissioners began to carry on the work as mentioned in the warrant.

8. It is seriously contended by the learned counsel for the respondent that the Advocate commissioners selected the Civil Engineers at the instance of the owner of the properties and the Advocate commissioners and the Civil Engineers acted in biased manner without duly considering the request made and instruction given by the respondent/contractor in the course of execution of the warrant and the respondent is not given proper opportunity to participate in the course of execution of the warrant by the Advocate Commissioners. The learned counsel for the respondent in support of such contention, also cited the following authorities (i)unreported judgment of this court made in OA.Nos.40 and 41 of 2010 and A.No.134 of 2010 dated 3.12.2010 by His Lordship Mr.Justice V.Periya Karuppiah, as he then was, Indian Kanoon-http://indiankanoon.org/doc/653754 and (ii)reported judgment in (2006) 128 DLT 691 Delhi High Court (Sanrachna (India) Inc. v. A.B.Hotels Ltd.

9. Heard the rival submissions made on both sides.

10. In order to appreciate the objections raised on the side of the respondent against the appointment of Advocate Commissioner, the relevant provisions of law to be looked into is Section 9 of the Arbitration and Conciliation Act, which reads as follows:

"Section 9. Interim measures, etc., by Court:

A party may before or during arbitral proceedings or at any time after the making of the arbitral award but before it is enforced in accordance with section 36 apply to a Court-

(i) for the appointment of a guardian for a minor or a person of unsound mind for the purposes of arbitral proceedings; or

(ii) for an interim measure of protection in respect of any of the following matters, namely:-

(a) the preservation, interim custody or sale of any goods which are the subject matter of the arbitration agreement;

(b) securing the amount in dispute in the arbitration;

(c) the detention, preservation or inspection of any property or thing which is the subject matter of the dispute in arbitration, or as to which any question may arise therein and authorising for any of the aforesaid purposes any person to enter upon any land or building in the possession of any party, or authorising any samples to be taken or any observation to be made, or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full information or evidence;

(d)interim injunction or the appointment of a receiver;

(e)such other interim measure of protection as may appear to the Court to be just and convenient;

andthe court shall have the same power for making orders as it has for the purpose of, and in relation to, any proceedings before it."

11. It is well settled that the arbitral proceedings may be invoked by a party either before, during or at any time after making the arbitral award, but before it is enforced in accordance with Section 36 of the Arbitration and Conciliation Act. It is also well settled that the purpose of enacting Section 9 is for interim measure of protection and the court is conferred with the same power for making specified orders as it has for the purpose of and in relation to any proceedings before it though the venue of the proceedings in relation to which the power under section 9 is sought to be exercised is the Arbitral Tribunal. The purpose for which, the interim order to be passed, is clearly enumerated under section 9 of the Act and the present case may fall under Section 9(ii)(c) and 9(ii)(e).

12. Though it is sought to be argued by the learned counsel for the respondent that the appointment of advocate commissioner to inspect the properties and to note down the extent of completed construction and other physical features available on land, is for the purpose of collecting evidence and the same is not permissible under law, such objection raised on the side of the respondent is legally untenable, as one of the interim measures of protection from the court, which can be sought for under section 9, is detention, preservation or inspection of any property or thing which is the subject matter of the dispute in arbitration, and authorising any person to enter upon any land or building in the possession of any party or authorising any samples to be taken or any observation to be made or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full information or evidence. Thus, this court is vested with jurisdiction to pass any order to make any observation upon or to collect any information about the property, which is the subject matter of the dispute in arbitration.

13. As a matter of fact, the respondent has in para 17 at page 6 of the affidavit filed in support of their application, referred to the object of appointment of an Advocate Commissioner under section 9 of the Arbitration and conciliation Act for the purpose of obtaining "full information or evidence". The entire averments raised in the counter would only reveal that the objection raised herein is not against the authority vested upon the Court to seek one such report, but against the manner in which the warrant is sought to be executed by the Advocate Commissioners with the assistance of particular Civil Engineer, who is not agreeable to the respondent herein.

14. It may be true that our High court and Delhi High court have in the authorities cited on the side of the respondent, under peculiar circumstances dealt with before the same, were of the view that appointment of Advocate Commissioner does not appear to be either desirable or in no way helpful to the court for preserving the property. The Delhi High court held so, having found that two sets of measurements are already made available before the arbitrator and it is for the arbitrator to decide which set of measurements and to what extent should be accepted to be correct and the Delhi High court has thus decided to leave the matter for decision by the arbitrator on the basis of material placed before him. In the case dealt with by our High Court, it is observed by the learned brother judge that "the appointment of advocate commissioner will not be in any way helpful to this court for preserving the property". The learned brother judge further added "it may be helpful to the arbitrator to decide the disputes in between the parties" and thus held that the commissioner need not be appointed at the particular stage as sought for by the applicant. Both Madras and Delhi High Courts have no where observed that this court has under Section 9 of A & C Act, no authority to pass any order for appointment of Advocate Commissioner in appropriate cases and request for appointment of Advocate Commissioner was negatived in the cases cited above only, having regard to the circumstances involved in the case at hand, as such, no general principle is laid down therein to be applied to the present case, which in my considered view, is factually distinguishable from the cases cited on the side of the respondent.

15. Here is the case, wherein, the main dispute is regarding the nature, extent and quality of the work completed and the parties are at issue about the quantum of amount payable and that the amount paid is not in commensurate with the construction completed. The claim made by the respondent/contractor is for payment of work completed. Whereas, the claim made by the applicant/owner is for completing the remaining work through third party contractor at the risk and responsibility of the respondent/contractor.

16. Before considering such claim of the parties on merits, the nature and extent of the work completed is to be necessarily ascertained. Though under section 26 of the Arbitration and Conciliation Act, the Arbitral Tribunal is empowered to call for expert opinion, the same does in no way oust the jurisdiction of this court to pass any specific order in this regard, as such, the objection raised on the side of the respondent that no order for appointment of Advocate Commissioner can be passed by this court, is both legally and factually unsustainable.

17. The next serious objection raised on the side of the respondent is against mode of execution of warrant by the Advocate Commissioners and their selection of Civil Engineer. The attention of this court is also drawn to the fact that there are disputes pending between the applicant and different building contractors, wherein similar relief is sought for in all the three cases and same set of Advocate Commissioners are appointed in two of the cases and the Engineer selected by name Natarajan and Sundar in two cases are father and son in relationship. According to the respondent, the Civil Engi

Please Login To View The Full Judgment!

neers are, at the instance of the applicant/owner, selected and acted in biased manner. 18. This court, having regard to the nature of the allegations raised on the side of the respondent herein and without going deep into the merits and demerits of the allegations raised and the reply put forth by the learned Advocate Commissioners, is in order to avoid embarrassment to all the parties, inclined to appoint two Advocate Commissioners afresh and to reissue the warrant to them for the same purpose mentioned in application A.No.3773 of 2012 and further appoint Mr.D.Pandurangan and Mr.J.Vara Prasad, Approved Panel Valuers suggested by both the learned counsel respectively to assist both Advocate Commissioners each. 19. Hence, Mr.M.A.Vimal Mohan, No.15, 9th Block, Kaviyarasu Kannadhasan Nagar, Kodungaiyur, Chennai-118 ph: 99627 89662, 91500 66642 and Mr.K.Prakash, No.201 Addl. Law Chambers, High Court Buildings, Chennai-104, ph:97907 64020, 91767 22000 are appointed as Advocate Commissioners for the same purpose mentioned in the application. The Advocate Commissioners are directed to execute the warrant with the assistance of Mr.D.Pandurangan and Mr.J.Vara Prasad, Approved Panel Valuers suggested by both the learned counsel respectively, after giving due intimation to both the parties and file their report along with plan on or before 9.11.2012. The parties are directed to extent their fullest cooperation to the Advocate Commissioners for execution of the warrant. The applicant is directed to pay initial remuneration of Rs.10,000/- each to the Advocate Commissioner immediately.
O R