(Prayer: Petition filed under Section 34 of the Arbitration and Conciliation Act, 1996, praying to set aside the Award dated 26.02.2025 passed by the Sole Arbitrator, Mr.V.Chandrasekaran, Advocate, concerning disputes between the Petitioners and Respondents.)

1.This petition has been filed under Section 34 of the Arbitration and Conciliation Act (for the sake of brevity, hereinafter referred to as 'the Act') against the Award passed by the Sole Arbitrator dated 26.02.2025.

2.The petitioners are the claimants. The case of the petitioners is that they are the absolute owners of their respective individual dwelling units together with proportionate undivided share of land forming part of the super-structure known as Jains Ashraya Phase II at K.K.Nagar, Chennai. They are also the members of the Flat Owners Association.

3.The petitioners were aggrieved by the maintenance charges fixed by the Association on the ground that the maintenance amount was not properly fixed considering the UDS allotted to each of the individual flat owners and was fixed in an arbitrary manner. The request made by the petitioners for refixing the maintenance charges also did not evoke any positive response from the Association. Hence, they invoked the arbitration clause and filed a petition in Arb.O.P.No.8 of 2022 for appointment of an Arbitrator. Since the parties were not able to reach any settlement, the Sole Arbitrator was appointed by this Court by an order dated 30.10.2023.

4.The petitioners filed statement of claim and sought for the following reliefs:

                   a) Declare the procedure adopted by the Respondent for revision of maintenance charges payable by members of the Jains Ashraya Phase II Flat Owners Association communicated to the Claimants and other members on 14.02.2022 and implemented from 01.04.2022 as unlawful and violative of the Clause 12.1.2. By Laws of the Association, and;

                   b) Declare the method of computation adopted by the Respondent for revision of maintenance charges payable by members of the Jains Ashraya Phase II Flat Owners Association communicated to the Claimants and other members on 14.02.2022 and implemented from 01.04.2022 as arbitrary, and not reflective of the actual assessable area occupied by the Claimants, and consequently, not binding on them, and;

                   c) Direct the Respondent to remove the name of the Claimants from the list of defaulters for maintenance charges and restore any and all rights they may have as members of the Association forthwith, and;

                   d) Direct the Respondent to comply with the Point No.8 of the Agenda forming a part of the AGM Notice dated 01.09.2022 issued by them, and consequently, conduct a General Body meeting for discussion on the Private Terrace areas forming a part of the apartment complex.

5.The respondent filed a statement of defence and also made a counter claim for a direction to the petitioners to pay the arrears of maintenance of Rs.32,418/- with penalty and interest.

6.The Sole Arbitrator on considering the pleadings framed the following issues:

                   i. Whether clause 12.1.2 of the bylaws of the association was complied with in AGM dated 12.12.20217

                   ii. Whether the AGM dated 12.12.2021 included the agenda 'maintenance' thereby attracting clause 12.1.2?

                   iii. Whether the revision of maintenance has been carried out in accordance with bylaws?

                   iv. Whether the maintenance fixed is in excess of the ownership of the members of the association/flat owners?

                   v. Whether the revision of maintenance charges by the respondent is binding on the claimant?

                   vi. Whether the authorized signatory of the respondent in the present case Ms. Gowri Bharathi is a competent representative as per the bylaws of the flat owners association?

                   vii. Whether the respondents are entitled to claim a sum of Rs. 32,418/- with or without penalty from the claimants which is variable for the future period towards alleged arrears of maintenance charges payable by them?

                   viii. Whether the Respondents are mandated to comply with Point No., 8 of the agenda forming a part of the AGM notice dated 01.09.2022 issued by them to conduct a General Body meeting for a discussion on the Private Terraces forming a part of the Apartment complex?

7.The petitioners relied upon thirty two documents which were marked as Exhibits A1 to A32. The respondent relied upon fifteen documents which were marked as Exhibits B1 to B15.

8.The Sole Arbitrator on considering the pleadings, evidence on record and facts and circumstances of the case rejected the claim petition and allowed the counter claim and directed the petitioners to pay the arrears of maintenance along with penalty and interest. Aggrieved by the same, the present petition has been filed before this Court.

9.Heard the learned Senior Counsel appearing on behalf of the petitioners and the learned counsel appearing on behalf of the respondent and this Court carefully perused the materials available on record and also carefully went through the Award passed by the Sole Arbitrator.

10.The main ground that was urged by the learned Senior Counsel appearing on behalf of the petitioners is that the petitioners had established the fact that the total area available as UDS is only 58,962.369 Sq. Ft. and the extent of 9594.631 Sq. Ft. was retained by the Developer and it was not proportionately divided among the owners of the dwelling units. Apart from that, there is a difference of about 19517 Sq. Ft. while comparing the documents and the actual extent that was taken for the purpose of calculation of the revised maintenance charges. In spite of the same, the entire extent was taken into consideration and the Association had refixed the maintenance charges disproportionate to the property enjoyed by the petitioners.

11.The learned Senior Counsel further questioned the manner in which the Annual General Body Meeting was held and the revised maintenance charges that was fixed in violation of Rule 12.1.2 of the by-laws of the respondent Association.

12.The Tribunal while dealing with the above issues came to a clear conclusion that the builder had illegally retained 9594.631 Sq. Ft. without proportionately dividing the same to the owners/members of the Association and that such retention of the undivided share will not bind the owners of the property. As a matter of fact, the Tribunal rendered a finding that an extent of 9594.631 Sq. Ft. was not under the control of the Developer and it was not maintained by the Developer and it formed part of the common area maintained by the Association.

13.Insofar as the legal position is concerned, it is now too well settled that once all the residential units are conveyed in favour of the respective owners, a Developer can never retain any portion of undivided share in the land alone. Therefore, the finding rendered by the Tribunal that the so called retention of undivided share by the Developer is illegal, is perfectly in accordance with law.

14.The Tribunal further went on hold that, while determining the maintenance payable by the respective owners, apart from the UDS portion, the common areas and other facilities must also be taken into consideration. The reasoning given by the Tribunal in Paragraph No.8 of the Award does not suffer from any perversity.

15.The last issue pertains to the manner in which the meeting was conducted by the Association. For this purpose, the Tribunal has placed reliance upon Ex.A30, which shows that, out of 114 members, 67 members of the respondent Association participated in the Annual General Body meeting including the claimants and it was resolved to continue with the prevailing system of maintenance charges on the basis of square feet and nearly 105 members out of 114 members agreed to pay maintenance as per the existing system. Thus, a majority of the members had agreed to pay the revised maintenance charges as per the resolution in the Annual General Body Meeting and the same was binding on all the members of the Association. The Arbitral Tribunal also took into consideration Clause 5.2.2 of the by-laws of the Association to hold that every member is liable to pay the maintenance charges as decided in the Annual General Body meeting.

16.In the considered view of this Court, the Award of the Sole Arbitrator is supported by reasons and it does not suffer from any perversity or manifest illegality warranting the interference of this Court in exercise of its jurisdiction under Section 34 of the Act. Applying the principles of Ssangyong Engineering & Construction Co. Ltd., vs. National Highways Authority of India (NHAI) reported in 2019 15 SCC 131, this Court holds that the Award passed by the Sole Arbitrator does not fit in any of the eight pigeon holes identified in this judgement.

17.In the result, this original petition stands dismissed. No Costs. Consequently, connected application is closed.