Category: Property Legal

AMENDMENT OF TOWN & COUNTRY PLANNING ACT, 2020 TO BOOST REAL ESTATE

The State Govt. has passed an ordinance on 22nd May 2020 to the TOWN & country planning act. Under the New Amendment act, The Developer shall provide a Provisional plan and Plan of phased development wherein the Developer/Builder can develop the project in three phases. The developer/Builder can develop the first phase with 40% development of the layout and thirty percent in the second phase & remaining 30% in third phase.

Thus after the area earmarked for roads, parks, Playground & other civic amenities of the entire layout area & after completion of the all infrastructure in first phase development the builder has to get the completion certificate from the concerned authority along with first phase development plan and then the developer/builder will be given permission to sell the sites of the first phase development.  The permission to sell will be given only after the registration of the Real Estate Project with RERA.  Similarly the Developer/Builder will be given permission to sell the sites/flat in the second & third phase only after the completion of all infrastructure in second & Third phase development.

ENFORCEMENT DIRECTORATE PERMITTED TO ATTACH THE ASSETS OF JP MORGAN TO THE EXTENT OF MONEY DIVERTED FROM AMRAPALI HOMEBUYERS

 

Last year Supreme court has ordered for the cancellation of RERA Registration of Amrapali group, as there were huge complaints of Diversion of the money paid by Homebuyers. Nearly 42000 flat buyers were waiting for possession of the flats after payment of huge amount of sale consideration. Nether the development was done nor flat was handed over to the Homebuyers.  Thus Home Buyers group has approached the Supreme Court in this regard.

In the meanwhile there were also allegations that the Amrapali group has diverted the Money to JP Morgan. The Supreme court has kept an embargo to the ED as to not to attach the assets of JP Morgan. That know the ED has provided Sufficient document in support of diversion of funds from Amrapali group to JP Morgan through the account. Hence Supreme Court has given permission to Enforcement Directorate (ED) which has identified that an amount of Rs.187 crores has been diverted to JP Morgan by Amrapali group from the amount paid by Amrapali Homebuyers in violation of Foreign Exchange Management Act & FDI Norms.

CHECK LIST FOR VERIFICATION OF LEGAL DOCUMENTS OF FLAT/PLOT/ SITES

CHECK LIST FOR VERIFICATION OF LEGAL DOCUMENTS OF FLAT/PLOT/ SITES

Title Deeds/ Mother Deed of the land

RTC/Pahani of land

Mutation Entry of land

IHC Certificate

Nil Tenancy Certificate

Family tree

Tippani

Akharbandh

Land Survey records,

Survey Assessment

Atlas

Village map

Index of lands

RR balbagh

Secondary reclass tippani

Endorsement issued by Assistant Commissioner under sec.79A & B of KLRA & under sec.4 of PTCL Act

Registered Partition Deed/s

Registered Sale Deed/s

Registered Gift Deed (If any executed)

Will/s(If any executed)

Mortgage Deed and Discharge Deed (If land was mortgaged for any banks to secure loans)

Encumbrance certificate of land/s for past 30 years

Tax paid receipts

Registered Joint Development Agreement Executed between Builder & Land lord/s

Registered General Power of Attorney Executed by Land lord/s in favor of Builder

Conversion order issued by Deputy commissioner permitting the conversion & use of agriculture land to Non-Agriculture residential use.

Conversion fees paid challan/receipt

Permission for change of land use

Building Approved plan And License

Plan sanction issued by Competent Authority

Commencement Certificate

NOC from BWSSB, BESCOM, KSPCB, HAL, BSNL, SEIAA, Fire Department, Airport Authority of India

House & Vacant Site register extract

Betterment charges paid receipt

Work Order issued by Competent Authority

Katha certificate

Completion & Occupancy Certificate

RERA Registration certificate

Encumbrance certificate of flat/Plot/Site

KARNATAKA LAND REFORMS (AMENDMENT) ACT, 2020 WHAT DOES THE AMENDMENT TO KARNATAKA LAND REFORMS (AMENDMENT) ACT, 2020, MEANS TO INDUSTRIES?

In Karnataka, No person or Company or Trust or any authorized person cannot purchase agriculture lands unless he is an Agriculturist. Thus any one who wants to purchase an Agriculture land must be an Agriculturist unless it is specified under the Exemptions mentioned under sec.109. AS such govt. has the power under sec.109 of Karnataka Land Reforms Act to exempt the and land/s from the applicability of provisions such as sec.63, 79A, 79B & 80 and those lands can be used for Industrial Purpose, Educational Purpose, Temples,  Housing projects, for Horticulture purpose including Floriculture and have specified units for each category under the provisions.

Prior to amendment any one who wants to set up an Industry in Karnataka, shall eb able to get an extent of 20 units only, by way of the Amendment to KLR act in 2020, govt has doubled the extent of land that can be utilized for Industries as 40 units. This change will give more land utilization capacity to the Industries and expand and Improve the production, utilization of land, labor and resources available to lead to more employment opportunities and growth in the economy of the state & country. (Unit” means [one acre (40.47 ares)] of A Class land)

Further to this the Purpose of Industrial development also includes Mining of Minor minerals, whether specified or Non-Specified and also includes the Stone Crushing activities under the Karnataka regulation of stone crushers act,2011. Thus it gives an open way to reopen the stne crushing Industries which were stopped since some time.

This amendment  makes it clear that all such lands which are approved by govt. with approval of state Highlevel clearance committee or State level single window clearance committee formed under the provisions of the Karnataka Industries Facilitation Act, 2002.

Further the company who has purchased the land with permission as mentioned above shall after utilization of the land for specific purpose for which it was purchased, it cannot use the land for the specified purpose for various reasons beyond its control than the said land with govt. permission for the utilization of the said land for same purpose. Thus this way the amendment gives a long way for the Industries to set up production along with the way ahead to get back the money invested in case if the Industry is not able to run for any reasons for which it was put up.

This amendment gives a boost for Industrial investment & development in the state further also contributes to the State & National Economy.

DO U HAVE TO PAY RENT DURING THE COIVD-19 LOCKDOWN SITUATION?

If u are a tenant and staying in a rented house, apartment unit, office space or staying in a P.G. Accommodation. Then you don’t have to worry, even if u have not paid the rent then your landlord cannot evict you from the place.

While the Entire country has come to a standstill because of the Govt. Orders imposed to Contain the Pandemic COIVD -19 and if your landlord is demanding rent from you for the lockdown period. Then what you can do in this situation?

In view of lockdown orders issued the Central Govt. there is also as order issued by MHA that the landlords shall not demand rent or force the tenants to be evicted from the place in the lock down situation. The central Govt. has invoked the provisions of Disaster Management Act to control the situation and in view of the same govt. has also issued an orders to the landlords as to not to demand rent. If your landlord is demanding you rent for the lockdown period and is either threatening you or trying to evict you, then it is illegal and he will have to face the legal consequences for these actions as per the orders passed by the MHA. Thus your landlord cannot force you or evict you for the nonpayment of rent during this lockdown period.

RERA – Relief to Home Buyers

Real  Estate Regulation and Development Act, 2016

The most awaited legislation namely Real Estate Regulation and Development Act, 2016 was passed and all the provisions of the act has come in force with effect from 1st May 2017. Thus the Home buyers who were suffering with the Builders having issues of Possession, Handover of the property to home buyers and the entire issues pertaining to the Real estate has been issued and regulated under this Act. The act aims to protect the Home Buyers from defrauding Builders/Developers by bringing in the transparency, accountability and regulation of the Real estate Sector in the country. this act also provides the Home Buyers various rights and reliefs to protect themselves from the High Handed acts of the builders, which was much awaited by the large sector of Home buyers since long time.

BENEFITS TO HOME BUYERS UNDER RERA:

Under this act each and every project has to be registered with RERA and it gives confidence to the customers, and they can cross check with the project and details of the project uploaded in the webpage of RERA, so that misleading customer will not be possible by any promoter/developer.

– Deposit of money in escrow account will make it sure to the customer that the money is safe and he will be paying only on the stage wise completion of the project. So the invested amount will be safe, as there cannot be deviation of money apart from the project for which it is kept, money has to be utilized only for the said project and not for any other project.

– The authority may on receipt of a complaint or on recommendation of a committee take action and revoke the registration of the project if there is wilful default of promoter/developer, willfully involved in unfair practices, willfully makes fraudulent practices, willfully falsely represents the grade/standard of project, willfully makes false and misleading representation, willfully makes advertisement to mislead.

– Upon revocation of registration the authority shall debar the project, promoter/developer from accessing the website, specify the names of promoter/developer in the defaulters list in the website, this gives caution to the other customers/investors about the project and promoter/developer. In case of revocation by the authority the appropriate govt shall take steps for the development work to be carried out either by the association or by the local authority as it deems fit.

– If promoter fails to give or complete possession as per the agreed terms of agreement then he shall be liable for compensation with interest at such prescribed rate of interest.

– The promoter shall be responsible to get the completion / occupancy certificate under the act. Otherwise the project will be incomplete.

– Each of the project registered with the authority shall be updated with all the documents and stage wise completion of the project. This gives customers a good support to verify the credibility of the project.

– The promoter shall not take advance amount on the project without registration of the sale agreement. Once the sale agreement is done cancellation of agreement can be done only in accordance with the agreement entered between promoter and allottee.

If any person makes an investment on the basis of the advertisement or false statement and suffers any loss, then the investment shall be returned with interest and compensated.

RIGHTS AND DUTIES OF HOME BUYERS/ALLOTTEE

  • The allottee shall be entitled to obtain information relating to sanctioned plans, lay out plans, along with other specifications as approved by competent authority & such other information as provided in the act, rules & regulations made there under or under agreement of sale signed with promoter.
  • The allottee shall be entitled to know stage wise time schedule of completion of the project, including provisions for water, sanitation, electricity & other amenities & services as agreed to b/w promoter & allotte in accordance with terms & conditions of agreement for sale.
  • The allottee shall be entitled to claim possession of apartment, plot or building as the case may be, & the association of allottes shall be entitled to claim possession of the common areas, as per declaration given by the promoter under sec.4[2][1][c]
  • Allottee shall be entitled to claim the refund of amount paid along with interest at such rate as may be prescribed & compensation in the manner as may be provided under this act, from the promoter, if promoter fails to comply or is unable to give possession of apartment, plot or building as the case may be, in accordance with terms of agreement for sale or due to discontinuance of his business as a developer under the provisions of this act or rules or regulations made thereunder.
  • The allottee shall be entitled to have necessary documents & plans, including that of common areas, after handing over the physical possession of apartment or plot or building, as the case may be, by promoter
  • Every allottee who has entered into an agreement for sale to take an apartment, plot or building as the case may be, under sec 13 shall be responsible to make necessary payments in the manner & within time as specified in the said agreement for sale & shall pay at the proper time & place, the share of registration charges, municipal taxes, water & electricity charges, maintenance charges, ground rent & other charges if any.
  • The allottee shall be liable to pay interest, at such rate as may be prescribed, for any delay in payment towards any amount or charges to be paid under sub-sec.6
  • The obligations of allottee under sub-sec.6 & the liability towards interest under sub-sec[7] may be reduced when mutually agreed to between the promoter  & such allottee.
  • Every allottee of the apartment, plot or building as the case may be shall participate towards the formation of an association or society or co-operative society, or a federation of the same.
  • Every allottee shall take physical possession of the apartment, plot or building as the case may be within a period of two months of the occupancy certificate issued for the apartment, plot or building as the case may be
  • Every allottee shall participate towards registration of the conveyance deed of this apartment, plot or building as the case may be provided under sub-sec[1] of sec 17 of this act.

Daughter’s share in Hindu Joint Family Property

If a daughter is born prior to the enactment of the Hindu Succession act, 1956, still she is entitled for  a share in the Hindu Joint family property. Supreme court has said in the case of  Danamma and another VS Amar and another- That though a daughter is born prior to 1950 she is entitled for a share in Joint family property as she is a coparcener by Birth. Thus a daughter also gets equal share in the Joint Family property of a Hindu family, irrespective of whether a daughter is married or unmarried and any daughter whether she is born prior to 1950 or after the enactment of the Hindu Succession act 1956, a daughter is by Birth a coparcener. hence a daughter also gets equal share in the joint family property as a son of the family gets.

The provisions of Section 6 of the Act, as it stood prior to its amendment by the Amendment Act, 2005. This provision reads as under:

“6. Devolution of interest in coparcenary property.—When a male Hindu dies after the commencement of this Act, having at the time of his death an interest in a Mitakshara coparcenary property, his interest in the property shall devolve by survivorship upon the surviving members of the coparcenary and not in accordance with this Act:

Provided that, if the deceased had left him surviving a female relative specified in Class I of the Schedule or a male relative specified in that class who claims through such female relative, the interest of the deceased in the Mitakshara coparcenary property shall devolve by testamentary or intestate succession, as the case may be, under this Act and not by survivorship.

Explanation 1.—For the purposes of this section, the interest of a Hindu Mitakshara coparcener shall be deemed to be the share in the property that would have been allotted to him if a partition of the property had taken place immediately before his death, irrespective of whether he was entitled to claim partition or not.

Explanation 2.—Nothing contained in the proviso to this section shall be construed as enabling a person who had separated himself from the coparcenary before the death of the deceased or any of his heirs to claim on intestacy a share in the interest referred to therein.”

Explanation 1 to the aforesaid Section states that the interest of the deceased Mitakshara coparcenary property shall be deemed to be the share in the property that would have been allotted to him if the partition of the property had taken place immediately before his death, irrespective whether he was entitled to claim partition or not.

Explanation 1 to Section 6:

“…Explanation 1 defines the expression ‘the interest of the deceased in Mitakshara coparcenary property’ and incorporates into the subject the concept of a notional partition.

It is essential to note that this notional partition is for the purpose of enabling succession to and computation of an interest, which was otherwise liable to devolve by survivorship

and for the ascertainment of the shares in that interest of the relatives mentioned in Class I of the Schedule. Subject to such carving out of the interest of the deceased coparcener the other incidents of the coparcenary are left undisturbed and the coparcenary can continue without disruption. A statutory fiction which treats an imaginary state of affairs as real requires that the consequences and incidents of the putative state of affairs must flow from or accompany it as if the putative state of affairs

had in fact existed and effect must be given to the inevitable corollaries of that state of affairs.”

“[T]he operation of the notional partition and its inevitable corollaries and incidents is to be only for the purposes of this section, namely, devolution of interest of the deceased in coparcenary property and would not bring about total disruption of the coparcenary as if there had in fact been a regular partition and severance of status among all the surviving coparceners.”

According to the learned author, at pp. 253-54, the undivided interest “of the deceased coparcener for the purpose of giving effect to the rule laid down in the proviso, as already pointed out, is to be ascertained on the footing of a notional partition as of the date of his death. The determination of that share must depend on the number of persons who would have been entitled to a share in the coparcenary property if a partition had in fact taken place immediately before his death and such person would have to be ascertained according to the law of joint family and partition. The rules of

Hindu law on the subject in force at the time of the death of the coparcener must, therefore, govern the question of ascertainment of the persons who would have been entitled to a share on the notional partition”.

That apart, we are of the view that amendment to the aforesaid Section vide amendment Act, 2005 clinches the issue, beyond any pale of doubt, in favour of the appellants. This amendment now confers upon the daughter of the coparcener as well the status of coparcener in her own right in the same manner as the son and gives same rights and liabilities in the coparcener properties as she would have had if it had been son. The amended provision reads as under:

“6. Devolution of interest in coparcenary property.―(1) On and from the commencement of the Hindu Succession (Amendment) Act, 2005 (39 of 2005), in a Joint Hindu family

governed by the Mitakshara law, the daughter of a coparcener shall,―

  • by birth become a coparcener in her own right the same manner as the son

(b) have the same rights in the coparcenary property as she would have had if she had been a son;

(c) be subject to the same liabilities in respect of the said coparcenary property as that of a son,

and any reference to a Hindu Mitakshara coparcener shall be deemed to include a reference to a daughter of a coparcener:

Provided that nothing contained in this subsection shall affect or invalidate any disposition or alienation including any partition or testamentary disposition of property which had taken place before the 20th day of December, 2004.

(2) Any property to which a female Hindu becomes entitled by virtue of sub-section (1) shall be held by her with the incidents of coparcenary ownership and shall be regarded,

notwithstanding anything contained in this Act or any other law for the time being in force, as property capable of being disposed of by her by testamentary disposition.

(3) Where a Hindu dies after the commencement of the Hindu Succession (Amendment) Act, 2005 (39 of 2005), his interest in the property of a Joint Hindu family governed by the Mitakshara law, shall devolve by testamentary or intestate succession, as the case may be, under this Act and not by survivorship, and the coparcenary property shall be deemed to have been divided as if a partition had taken place and,―

  • the daughter is allotted the same share as is allotted to a son;

(b) the share of the pre-deceased son or a pre-deceased daughter, as they would have got had they been alive at the time of partition, shall be allotted to the surviving child of such

pre-deceased son or of such pre-deceased daughter; and

  • the share of the pre-deceased child of a pre-deceased son or of a pre-deceased daughter, as such child would have got had he or she been alive at the time of the partition, shall be allotted to the child of such pre-deceased child of the pre-deceased son or a pre-deceased daughter, as the case may be.

Explanation.―For the purposes of this sub-section, the interest of a Hindu Mitakshara coparcener shall be deemed to be the share in the property that would have been allotted to him if a partition of the property had taken place immediately before his death, irrespective of whether he was entitled to claim partition or not.

(4) After the commencement of the Hindu Succession (Amendment) Act, 2005 (39 of 2005), no court shall recognize any right to proceed against a son, grandson or great-grandson for the recovery of any debt due from his father, grandfather or great-grandfather solely on the ground of the pious obligation under the Hindu law, of such son, grandson or great-grandson to discharge any such debt:

Provided that in the case of any debt contracted before the commencement of the Hindu Succession (Amendment) Act, 2005 (39 of 2005), nothing contained in this sub-section shall affect―

(a) the right of any creditor to proceed against the son, grandson or great-grandson, as the case may be; or

(b) any alienation made in respect of or in satisfaction of, any such debt, and any such right or alienation shall be enforceable under the rule of pious obligation in the same

manner and to the same extent as it would have been enforceable as if the Hindu Succession (Amendment) Act, 2005 (39 of 2005) had not been enacted.

Explanation.―For the purposes of clause (a), the expression “son”, “grandson” or “great-grandson” shall be deemed to refer to the son, grandson or great-grandson, as the

case may be, who was born or adopted prior to the commencement of the Hindu Succession (Amendment) Act, 2005 (39 of 2005).

(5) Nothing contained in this section shall apply to a partition, which has been effected before the 20th day of December, 2004.

Explanation.―For the purposes of this section “partition” means any partition made by execution of a deed of partition duly registered under the Registration Act, 1908 (16 of 1908) or partition effected by a decree of a court.]”

The controversy now stands settled with the authoritative pronouncement in the case of Prakash & Ors. v. Phulavati & Ors. which has approved the view taken by the aforesaid High Courts as well as Full Bench of the Bombay High Court.

that the proviso to Section 6(1)and sub-section (5) of Section 6 clearly intend to exclude the transactions referred to therein which may have taken place prior to 20-12-2004 on which date the Bill was introduced.

Explanation cannot permit reopening of partitions which were valid when effected. Object of giving finality to transactions prior to 20-12-2004 is not to make the main  provision retrospective in any manner. The object is that by fake transactions available property at the introduction of the Bill is not taken away and remains available as and when right conferred by the statute becomes available and is to be enforced. Main provision of the amendment in Sections 6(1) and (3) is not in any manner intended to be affected but strengthened in this way. Settled principles governing such transactions relied upon by the appellants are not intended to be done away with for period prior to 20-12-2004. In no case statutory notional partition even after 20-12-2004 could be covered by the Explanation or the proviso in question.

Accordingly, it is held that the rights under the amendment are applicable to living daughters of living coparceners as on 9-9-2005 irrespective of when such daughters are born.

Disposition or alienation including partitions which may have taken place before 20-12-2004 as per law applicable prior to the said date will remain unaffected. Any transaction of partition effected thereafter will be governed by the Explanation.”

The The law relating to a joint Hindu family governed by the Mitakshara law has undergone unprecedented changes. The said changes have been brought forward to address the growing need to merit equal treatment to the nearest female relatives, namely daughters of a coparcener. The section stipulates that a daughter would be a coparcener from her birth, and would have the same rights and liabilities as that of a son. The daughter would hold property to which she is entitled as a coparcenary property, which would be construed as property being capable of being disposed of by her either by a will or any other testamentary disposition. These changes have been sought to be made on the touchstone of equality, thus seeking to remove the perceived disability and prejudice to which a daughter was subjected.

The fundamental changes brought forward about in the Hindu Succession Act, 1956 by amending it in 2005, are perhaps a realization of the immortal words of Roscoe Pound as appearing in his celebrated treaties, The Ideal Element in Law, that “the law must be stable and yet it cannot stand still. Hence all thinking about law has struggled to reconcile the conflicting demands of the need of stability and the need of change.”

Section 6, as amended, stipulates that on and from the commencement of the amended Act, 2005, the daughter of a coparcener shall by birth become a coparcener in her own right in the same manner as the son. It is apparent that the status conferred upon sons under the old section and the old Hindu Law was to treat them as coparceners since birth. The amended provision now statutorily

recognizes the rights of coparceners of daughters as well since birth. The section uses the words in the same manner as the son. It should therefore be apparent that both the sons and the daughters of a coparcener have been conferred the right of becoming coparceners by birth. It is the very factum of birth in a coparcenary that creates the coparcenary, therefore the sons and daughters of a coparcener become coparceners by virtue of birth. Devolution of coparcenary property is stage of a coparcenary is obviously its creation as explained above, and as is well recognized. One of the incidents of coparcenary is the right of a coparcener to seek a severance of status. Hence, the rights of coparceners emanate and flow from birth (now including daughters) as is evident from sub-s (1)(a) and (b).

HINDU MITAKSHARA COPARCENARY:

According to the Mitakshara School of Hindu Law all the property of a Hindu joint family is held in collective ownership by all the coparceners in a quasi-corporate capacity. The Textual authority of the Mitakshara lays down in express terms that the joint family property is held in trust for the joint family members then living and thereafter to be born (See Mitakshara, Ch. I. 1-27). The incidents of copartnership under the Mitakshara law are: first, the lineal male descendants of a person up to the third generation, acquire onbirth ownership in the ancestral properties is common; secondly, that such descendants can at any time work out their rights by asking for partition; thirdly, that till partition each member has got ownership extending over the entire property, conjointly with the rest; fourthly, that as a result of such co-ownership the possession and enjoyment of the properties is common; fifthly, that no alienation of the property is possible unless it be for necessity, without the concurrence of the coparceners, and sixthly, that the interest of a deceased member lapses on his death to the survivors.”

 Hence, it is clear that the right to partition has not been abrogated.

The right is inherent and can be availed of by any coparcener, now even a daughter who is a coparcener.

THE ARBITRATION AND CONCILIATION (AMENDMENT) BILL, 2018

THE ARBITRATION AND CONCILIATION (AMENDMENT) BILL, 2018

Amendment to Sec. 2 of  The Arbitration and conciliation act 1996 – a New clause  (Ca) is included – ‘(ca) “arbitral institution” means an Arbitral institution designated by the Supreme Court or a High Court under this Act;’;

Amendment of sec. 11  –

Under sce.11(3a)- The High court and Supreme Court judges shall have the power to designate arbitral institutions form time to time. If no Arbitral Institutions are provided the High court shall maintain a panel of Arbitrators for discharging the functions of Arbitral Institutions.

  • Concerned Chief Justice shall do the Panel of Arbitrators shall be reviewed from time to time.
  • In the case of International  Commercial Arbitration the designated Arbitral Institution appointed by the supreme court shall appoint the Arbitrators and in cases other than International Arbitrations the Arbitral Institutions designated by the High court shall appoint the Arbitrators.
  • An application made for the appointment of Arbitrators shall be disposed off within 30 days of service of notice to opposite party.
  • The Arbitral Institution shall determine the fees of Arbitral Tribunal as per schedule Fourth. This shall not be applicable for International Arbitrations and International Commercial Arbitrations where the fees has been already fixed by parties.

Amendment of sec 23- A claim statement and defense shall be completed within a period of six months of the Arbitrators receiving notice of the appointment.

Amendment of sec 29A- Award in the Arbitration cases shall be made within 12 months form the date of completion of pleadings, Except International Commercial Arbitration..

New Sec 42A is inserted- This section provides that all the proceedings of the Arbitration shall be kept confidentially except the Award that needs to be enforced and executed.

New sec 42B inserted – This sections provides that no suit or proceedings shall lie against the Arbitrators while any action is done in good faith.

Sec.43 A to sec 43 J – Provides for the Establishment and incorporation of Arbitration Council of India,  Composition of Council, Duties and Functions of the Council,  Appointment of experts and Constitution of committees, General norms for grading Arbitral Institutions, Norms of Accreditation, Depository of Awards, Power to make regulations by  council.

Thus under the Amendment act the Arbitration will be having a separate council and Institutions like any other Authorities and will be functioning as per these provisions.

New Sec 87 inserted – Unless the parties Agrees, the Amendments made to Arbitration and conciliation Amendment act 2015 – shall not apply – If the Arbitral proceedings have commenced before the Commencement of the Amendment act 2015, the court proceedings in relation to such arbitral proceedings whether such proceedings are commenced before of after the Amendment act 2015,

It shall apply only to Arbitral Proceedings and court proceedings commenced on or after the commencement of Amendment act 2015 came into force.

A new Eighth Schedule is inserted specifying the Qualifications, Experience and Norms of such Arbitrator to be appointed under the act.

section 26 of the Arbitration and conciliation Amendment act 2015  has been Omitted with effect from 23rd October 2015.

EFFECT OF NON-REGISTRATION OF PARTNERSHIP FIRMS

Indian Partnership Act

Section “69 Effect of non-registration-

(1) No suit to enforce a right arising from a contract or conferred by this Act shall be instituted in any Court by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.

(2) No suit to enforce a right arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partners in the firm.

(3) The provisions of subsections (1) and (2) shall apply also to a claim of set-off or other proceeding to enforce a right arising from a contract, but shall not affect – (a) the enforcement of any right to sue for the dissolution of a firm or for accounts of a dissolved firm, or any right or power to realise the property of a dissolved firm, or (b) the powers of an official assignee, receiver or Court under the Presidency-towns Insolvency Act, 1909, or the Provincial Insolvency Act, 1909, to realise the property of an, insolvent partner.

Under Section 69(1), a suit, inter alia to enforce right arising from a contract cannot be filed by a person Suing as a partner in a firm against the other partners of the firm unless the firms registered. Under sub-section (3) any other proceeding to enforce a right a arising from a contract by a person suing as a partner against the other partners of an unregistered Firm is also barred. Since the right to resort to arbitration flows from the contract between the parties contained in the partnership deed, a suit or any other proceeding by a partner to enforce this term in the contract against the other partners would, therefore, normally be barred under the first part of sub- section (3) of Section 69. (Vide Jagdish Chandra Gupta v. Kajaria Traders (India) Ltd. [AIR 1964 SC 1882 infra]). Subsection (3) in its later part, however, carves out certain exceptions to the bar contained in sub-sections (1), (2) and the first part of sub section(3).

Under sub-section (3)(a) this bar will not affect the enforcement of any right to sue for the dissolution of a firm or for accounts of a dissolved firm or any right or power to realise the property of a dissolved firm.

Therefore, although the partnership firm may be unregistered, one partner can sue other partners for dissolution of the firm and for accounts. The words “to sue” used in sub-section (3)(a) cannot be construed narrowly to refer only to suits for dissolution of partnership and accounts. The exception contained in sub-section (3)(a) applies not merely to sub-sections (1) and (2) but also to the first part of sub-section (3) which deals with proceedings other than suits. Therefore, in order that subsection (3)(a) would apply to all these provisions, the words “to sue” section (3)(a) must be understood as applying to any proceedings for dissolution of partnership or for accounts of a dissolved firm or to realise the property OF a dissolved firm. This proceeding may be either by way of a suit or it can even be a proceeding under the Arbitration Act to secure these rights through arbitration. [Vide Prem Lata (Smt)] & Anr. v. M/s IsharDass Chaman&Ors. (1995 2 SCC 145), a judgment to which one of us was a party.] Therefore, an arbitration clause in a partnership deed of an unregistered partnership can be enforced for the purpose of securing, inter alia, a dissolution and accounts of the partnership or for enforcing any right or power for obtaining the property of a dissolved firm.

APPLICABILITY OF ARBITRATION AND CONCILIATION ACT 1940 AND ARBITRATION AND CONCILIATION ACT 1996.

In a peculiar case, where the parties under the agreement have agreed for the applicability of Arbitration and Conciliation Act, 1940, while the agreement was done after the Arbitration and conciliation Act 1996 had come in force.

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.4664 OF 2018

(Arising out of SLP (Civil) No.14589 of 2016)

Purushottam s/o Tulsiram Badwaik ……Appellant

VERSUS

Anil & Ors. ..…. Respondents

The SLP was filed as regards the issue under which provisions of the Arbitration act, the dispute has to be decided and which Act shall be applicable, when the parties in their agreement have agreed to refer to the Arbitration and Conciliation act 1940, while the agreement was done very well after the Arbitration and Conciliation act 1996 was in force.

HELD- In view of the Arbitration and Conciliation act 1996 and repeal provisions at Sec 85 – The provisions- The correct approach, according to us, would be in promoting the object of implementing the scheme of alternative dispute resolution as was rightly submitted in MMTC Ltd. (Supra). It would be farfetched to come to the conclusion that there could be no arbitration at all. As is clear from MMTC Ltd. (Supra) what is material for the purposes of the applicability of 1996 Act is the agreement between the parties to refer the disputes to arbitration. If there be such an arbitration agreement which satisfies the requirements of Section 7 of 1996 Act, and if no arbitral proceeding had commenced before 1996 Act came into force, the matter would be completely governed by the provisions of 1996 Act. Any reference to 1940 Act in the arbitration agreement would be of no consequence and the matter would be referred to arbitration only in terms of 1996 Act consistent with the basic intent of the parties as discernible from the arbitration agreement to refer the disputes to arbitration.

Viewed thus, the High Court was not right in observing that there could be no arbitration at all in the present case. In situations where the relevant clause made reference to the applicability of “the provisions of the Indian Arbitration Act and Rules made thereunder” as was the case in MMTC Ltd. (Supra), on the strength of Section 85(2)(a) the governing provisions in respect of arbitral proceedings which had not commenced before 1996 had came into force would be those of 1996 Act alone. On the same reasoning even if an arbitration agreement entered into after 1996 Act had come into force were to make a reference to the applicable provisions of those under Indian Arbitration Act or 1940 Act, such stipulation would be of no consequence and the matter must be governed under provisions of 1996 Act. An incorrect reference or recital regarding applicability of 1940 Act would not render the entire arbitration agreement invalid. Such stipulation will have to be read in the light of Section 85 of 1996 Act and in our view, principles governing such relationship have to be under and in tune with 1996 Act. As observed earlier, the requirements of “arbitration agreement” as stipulated in Section 7 of 1996 Act stand completely satisfied in the present matter nor has there been any suggestion that the agreement stood vitiated on account of any circumstances in the realm of undue influence, fraud, coercion or misrepresentation. In the circumstances, the attempt must be to sub-serve the intent of the parties to resolve the disputes by alternative disputes resolution mechanism. The High Court was, therefore, completely in error.

We therefore set aside the judgment and order passed by the High Court and accept the appeal preferred by the appellant. The matter will have to be dealt with by the trial court in terms of Section 8 of 1996 Act. The parties shall appear before the trial court on 14th May, 2018 for effectuating the arbitration agreement.