Deccan Paper Mills Co. Ltd. v. Regency Mahavir Properties & Ors., 2020
Court: Supreme Court
Coram: Justice Rohinton Fali Nariman, Justice Navin Sinha, and Justice Banerjee.
Date of Judgement: 19th of August, 2020
Petitioner: Deccan Paper Mills Co. Ltd.
Respondent: Regency Mahavir Properties & Ors.
Facts of the Case:
- The petitioner, Deccan Paper Mills Co. Ltd. filed the suit against the respondent, Regency Mahavir Properties, and others seeking for declaration of the agreement dated 22nd July 2004 and 20th May 2006 were null ab-initio. They wanted the agreement to be declared as illegal and not binding over the petitioners. They contended that even the deed of confirmation is declared as illegal and null ab-initio as consent from the petitioner was obtained wasn't free since it was obtained by fraud. The said agreement's cancellation was sought.
- While the above event was taking place, Regency Mahavir Properties & Ors. filed an application under Section 8 of the Arbitration and Conciliation Act, 1996. The aforementioned was allowed and the matter was referred for arbitration.
- Deccan Paper Mills Co. Ltd. filed a writ petition before the Hon'ble High Court of Bombay against the same. The writ petition was dismissed by the Hon'ble High Court.
- In the current appeal before the Hon'ble Supreme Court, Deccan Paper Mills Co. Ltd. prays that all agreements should be canceled since their consent was obtained via fraud, and hence the agreements are illegal. Moreover, Deccan Paper Mills Co. Ltd. contended that the proceedings under Section 31 of the Specific Relief Act, 1963 is a proceeding in rem and hence it falls under the Booz Allen Case.
Issues of the Case:
- Arbitrability of the present dispute involves allegations of fraud.
- Whether the proceedings under Section 31 of the Specific Relief Act, 1963 is proceeding in rem or proceeding in personam.
The judgment of the Case:
- The Hon'ble Supreme Court observed that 'a a person' mentioned in Section 31 of the Specific Relief Act, 1963 does not include a third person but it is restricted to a party to the written statement or any other instrument which may bind a third party. The aforementioned section determines when a written statement can be adjourned as void or voidable. The Court contended that it is clear by a section that an action under it is strictly an action inter-parties or by a person that has obtained a title by the parties and thus is in persona.
- Moreover, the Hon'ble Supreme Court relied on judgment Avital Post Studioz Limited v. H. S. B. C. that merely because a case has criminal overtones, it doesn't make it non-arbitrable.
This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being.