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Section 17 AA Interim relief Not Automatic in Redevelopment Arbitration

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Section 17 AA relief Not Automatic in Redevelopment Arbitration

Damages, Not Specific Performance – Key Takeaway from the Judgment of Bombay HC on Stay to Termination of Development Agreement

Arbitrator’s discretion upheld – Bombay HC Refuses Section 17 Relief to Developer to stay termination of Development Agreement

such a matrix, if the Learned Arbitral Tribunal has returned a view that damages would compensate the Developer if he turns out to be correct, and the members of the Society who have been waiting since 2015 need not be forced to live in a dilapidated building hoping for an eventual resolution, such an outcome cannot be faulted.

Whether injunctive relief against the Termination Notice, in aid of final specific relief should have been granted or whether denial of an injunction on the premise that damages would adequately compensate wrongful termination will be the subject matter of the arbitral proceedings.

Section 17 – Restraint on Notice of Termination of the Development Agreement dated 15.9.2019.

On 24.10.2019 the Society terminated the Development Agreement dated 15.9.2019.   The Developer filed section 9 petition.   In the said petition, the parties filed consent terms on 24.3.2021 followed by the execution of a supplementary agreement dated 24.6.2021.  It was agreed that the Society has no objection to the Development for amalgamation of its plot with the adjoining plot.  On the same day, Power of Attorney was also executed.

On 28.3.2022, the notice for demolition of the structure on the adjoining plot was issued.  This was stayed by the Court.

On 23.6.2022, the Society issued notice of termination.

By the order dated 25.8.2023, the Arbitrator rejected section 17 application of the Developer for restraint on the notice of termination of the Development Agreement dated 15.9.2019

Judgment dated 3.11.2025 of the High Court of Bombay in Arbitration Petition No.43 of 2025 of Sangvi Lifespace Pvt Ltd  Vs.  Megh Mahal Cooperative Housing Society and another with connected petition

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