M/S Emaar MGF Land Limited & Anr. v. Aftab Singh
Court: Supreme Court
Bench: Two Judge Bench of Honourable Supreme Court
Facts of the Case
A couple of petitions were filed by people who had booked residential villas, flats, or plots in Gurgaon or Mohali which were projects of a builder. The petitioners had signed a Buyer's Agreement. The buyer's agreements consisted of an arbitration clause. The buyer had promised to deliver possession of the villas, plots and flats on a certain date but had failed to do so. The petitioners filed a case at respective Consumer Forums. They sought directions to the builder to deliver possession and pay compensation for the delay. The builder filed a set of applications under Section 8 of the Arbitration and Conciliation Act, 1996 and prayed that the disputes must be resolved via Arbitration due to the presence of an Arbitration clause in the Buyer's Agreement signed between the builder and the buyers.
Section 8: Pre amendment in 2015 - Section 8 stated that only parties to an Arbitration Agreement may seek reference to Arbitration.
Post amendment in 2015: People claiming through the parties and the parties themselves may seek reference to Arbitration.
Issues of the Case: After the 2015 Amendment, does the newly inserted Section 8(1) of the Arbitration and Conciliation Act mandate the National Consumer Dispute Redressal Commission (N. C. D. R. C.) constituted under the Consumer Act?
National Consumer Dispute Redressal Commission (N. C. D. R. C.)'s Judgement
Before the Amendment, it was determined that Consumer Forums were not bound to hear disputes on Arbitration under Section 8 of the Arbitration and Conciliation Act, 1996. It was observed that Section 2(3) of the Arbitration and Conciliation Act, 1996 recognizes schemes under other legislations that make disputes non-arbitrable. The Consumer Forum stated that as per the overall structure of the consumer forum act and precedents set, the newly inserted Section 8 (1) of the Arbitration and Conciliation Act, 1996 cannot be construed as a mandate to the Consumer Forums to refer the parties to Arbitration as per the terms of the Arbitration Agreement signed between the parties. Aggrieved by the judgment, an appeal was filed to the Supreme Court.
Supreme Court's Judgement
The Hon'ble Apex Court upheld N. D. C. R. C.'s judgment and stated that an Arbitration Clause in a Buyer's Agreement doesn't circumscribe the jurisdiction of a Consumer Forum, notwithstanding the amendments made to the newly inserted Section 8(1) of the Arbitration and Conciliation Act in the 2015 Amendment.
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.