Full Judgment
1 ORDER
SHEET APO No.201 of 2011 A.P.No.390 of 2010 A.P.No.387 of 2011 IN THE HIGH COURT AT CALCUTTA Civil Appellate Jurisdiction ORIGINAL SIDE RANJITA APARTMENT FLATOWNERs.ASSOCIATION & ORS …………………..Appellant.
Versus PRABIR KUMAR CHAKRABORTY …………………Respondent.
BEFORE: The Hon'ble JUSTICE BANERJEE The Hon'ble JUSTICE SHUKLA KABIR (SINHA) Date :
21. t September, 2012.
Heard on:
21. t September, 2012 Judgment on:
21. t September, 2012.
Appearance: Mr.Pradip Dutta, Sr.Advocate with Mr.Arindam Sinha, Advocate For the claimant.
Mr.Anirban Basu with Mr.Sayak Majumder, Advocates For the respondent.
ASHIM KUMAR BANERJEE,J :- This appeal would arise out of a trifle issue that has been carried to the last Court of the State.
The sole dispute would center around a multi-storied building having seven flats in all.
Initially, three flats were owned by one Barun Chowdhury and his family members whereas the other four flats were being enjoyed by four different allottees.
By a memorandum of understanding dated January 30, 2002, the parties agreed that they would form a residents’ association.
They would share the proportionate cost of maintenance.
The four flat owners would pay Rs.1000/- each whereas Barun Chowdhury, being owner of three flats, would pay Rs.2000/-.
If we go by the number of flats, Barun should have paid Rs.3000/-.
However, we are told, he was enjoying two smaller flats having 600 odd square feet, one of them is the subject matter of the controveRs.in the present appeal.
Barun sold one of the smaller flats, being A3 to Prabir Kr.
Chakraborty, the respondent, a teacher of South Calcutta Girls’ College being the respondent.
Barun also sold the other two flats to two different individuals.
After Barun left, seven flats were being enjoyed by seven allottees.
Initially they agreed to pay maintenance charges at the rate of Rs.1000/- per month.
Prabir objected to such decision as he would require to pay Rs.800/- considering the smaller area he was enjoying.
The others did not agree.
As a result, he had to swallow the bitter pill being the rule of majority.
Initially, he continued to pay maintenance at the rate of Rs.1000/- as decided.
Subsequently, he raised dispute and stopped paying maintenance that gave rise to a dispute that was ultimately referred to arbitration of one retired District Judge appointed by this Court under section 11 of the Arbitration and Conciliation Act, 1996.
At the fiRs.sitting of the arbitration Prabir expressed his inability to bear the cost of arbitration as he was asked to share half of the expenses.
His objection was recorded charge in the Rs.2500/- minutes.
per The sitting arbitrator apart from decided to Rs.1300/- as administrative cost aggregating to Rs.3800/- per sitting to be shared equally by the parties being association on the one hand and Prabir on the other.
It would appear from the minutes his Counsel also agreed to share the cost in principle, however, expressed his inability because of his precarious financial condition.
We are amazed to note, the Arbitrator settled this trifle issue through his award after 62 sittings.
Mr.appearing for Pradip the Dutta, association learned contends, Senior Counsel it due was to indifferent attitude of Prabir as he went on changing his counsel and thereby taking adjournments.
His contention is strenuously disputed by Mr.Bose appearing for Prabir.
Be that as it may, fact would remain, the Arbitrator could resolve the trifle controveRs.in 62 sittings and charged cost of about Rs.3 lacs as we find from the award.
The Arbitrator Rs.800/- by his month per award as decided that maintenance.
Prabir to pay accepted Prabir was the decision and paid the entire principal amount.
The Arbitrator awarded interest @15% p.a.as per the agreed rate mentioned in the Memorandum of Understanding referred to above.
Prabir filed an application for setting aside.
contention on interfered with Learned factual the Judge score.
interest did His and not accept Lordship, cost.
His his however, Lordship observed, for the trifle issue the cost was too much.
His Lordship also awarded lesser rate of interest reducing the rate from 15% to 10% p.a.Being aggrieved, the association has not come up before us by preferring the instant appeal.
We have heard Mr.Dutta at length on behalf of the appellant.
Mr.Bose also made elaborate submissions on behalf of Prabir.
Mr.Dutta would contend, since Prabir accepted the award by making payment of the principal amount, he would not be entitled to challenge the maintenance fee and the decision of the Arbitrator on that score.
On interest, Mr.Dutta contends, the Arbitrator was bound by the agreement that would incorporate the rate of interest as agreed by and between the parties.
On cost, Mr.Dutta contends that Prabir agreed to bear the cost as recorded in the minutes of the meeting of the arbitration.
Hence, he was not entitled to grumble on that issue.
Mr.understanding Bose was contends, entered into since by and memorandum between the of then owners of the premises in question Prabir not being a party to the said agreement was not bound by the clauses incorporated therein.
He also contends, the memorandum of understanding was entered into at a time when the parties did not have conveyance in respect of their respective flats they were possessing.
Hence such agreement did not have any binding effect.
On Prabir was the fighting cost, the Mr.Bose litigation strenuously against contends, six of the allottees.
Hence, he would at best be obliged to pay 1/7th of the cost.
We have considered the rival contentions.
On the principal issue we feel, Prabir missed the bus.
He accepted the award so merged with the order of the learned Single Judge.
He did not prefer any appeal from the order of the learned Single Judge rejecting his contention on the principal issue.
Moreover, he acted upon the same by making payment of the maintenance charges as directed by the Arbitrator.
We are told, subsequent maintenance charges are outstanding.
We find from the envelopes brought by Mr.Bose in Court cheques were returned by the association.
Mr.Dutta on instruction submits, in case Prabir tenders the entire arrear by tomorrow strictly as per the award, they would accept the same without any interest.
Mr.Dutta also assures this Court that a detailed calculation on the arrear outstanding on account of maintenance would be furnished to Mr.Bose and/or his Advocate-on-Record in couRs.of the day to enable Prabir to make payment by tomorrow.
On the interest issue, we are of the view, Prabir derived title from Barun, who was a party to the memorandum of understanding.
The rate has not been fixed by the Arbitrator.
Since there was initial default Prabir would have to pay interest on the defaulted amount so covered by the award.
The Arbitrator awarded interest at the agreed rate of interest of 15% p.a.We do not have any scope to disagree so far it would relate to pre-reference period.
The post reference being the interim interest and interest on the award Arbitrator.
would The depend learned upon Judge, the discretion while of the considering the application for setting aside, reduced the rate at 10% p.a.We find no scope of disagreement on that score.
Hence, Prabir would pay interest on the awarded sum @ 15% p.a.till the date of entering into the reference being October 15, 2004 and @ 10% p.a.on and from October 16, 2004 till April 13, 2011.
This leaves us with the sole question of cost.
Mr.Bose has relied upon a recent decision of the Apex Court in the case of Sanjeev Kumar Jain versus Raghubir Saran Charitable Trust reported in (2012) 1 SCC 45.where we find Apex Court considered the issue of costs of arbitration.
Several paragraphs spent for the purpose would definitely guide us to decide the issue.
On a combined reading of paragraphs 37 to 42 we would find, the Apex Court was of the view that the cost of arbitration must be reasonable.
When an aggrieved party feels that his legal right is being jeopardized, he is entitled to have redressal through the legal process as guaranteed by the Constitution.
Any citizen of the country, if feels oppressed on any count, when his legal right is in jeopardy, he would be at liberty to approach the Court of law for redressal of his grievances.
Since Court of law is bogged down with mountain of litigations, alternative dispute resolution is the apt mechanism to ease the burning issue.
Arbitration is one of the methods known in the field where parties could agree to resolve their disputes in a domestic forum.
Hence the cost should also be reasonable and affordable to avail alternate dispute resolution mechanism.
Coming to the present scenario, we feel, on a issue where maintenance was in arrear for Rs.58,000/- and odd, cost of Rs.3 lacs in an arbitration would be too much.
62 sittings were held, we do not know, at whose fault.
We fail to appreciate, how a retired District Judge could allow 62 sittings to be held to resolve this trifle issue.
We are told, Prabir already paid Rs.8,000/- to the Arbitrator.
He also paid Rs.30,000/- as per the direction of the learned Single Judge, which association did not accept.
Let him pay Rs.60,000/- in all after taking credit of Rs.8,000/-.
Mr.Bose, on instruction, accepts the cost so assessed by us and prays for six equal monthly instalments.
Since Prabir would have to pay all the arrear maintenance charges by tomorrow, we feel, interest of justice would subserve if we grant him some time to pay off the cost.
Let him pay Rs.52,000/- in four equal monthly instalments of Rs.13,000/- to he paid positively by 7th day of each succeeding month.
One single default would attract interest @10% on and from the date of default and this order would be available for execution as a decree.
So far as interest component is concerned, Mr.Dutta’s Advocate-on-Record calculation on interest and would prepare furnish it to a Mr.detailed Bose’s Advocate-on-Record within a week from date.
Let Prabir pay the interest component on the fifth month after the cost is fully paid.
Prabir is present in Court.
He has agreed to the order being passed.
The prayer for instalments has been made by Mr.Bose on specific instruction received from him.
He also assures this Court, in future he would not make any default in making payment of the maintenance.
This appeal is thus disposed of without any order as to costs in this appeal.
Urgent certified copy of this order, if applied for, be given to the parties upon compliance formalities.
[ASHIM KUMAR BANERJEE,J].SHUKLA KABIR (SINHA).J:- I agree.
[SHUKLA KABIR (SINHA),J].dg/ of all