Rahul Bhargava & Anr. v. Neo Developers Pvt. Ltd.
Forum: Delhi High Court
Facts:
Homebuyers in the Neo Square project had already pursued remedies before HARERA. They subsequently approached the Commercial Court under Section 9 of the Arbitration and Conciliation Act seeking interim protection against alienation or encumbrance of the disputed units. The Commercial Court treated the prior RERA proceedings as preventing the Section 9 proceedings on the basis of election of remedies.
Issue:
Whether a party that has invoked RERA can subsequently seek interim protection under Section 9 of the Arbitration Act.
Held:
The Delhi High Court set aside the Commercial Court's approach. It held that RERA relief and Section 9 interim protection are not necessarily mutually exclusive. The RERA proceedings concern substantive statutory rights, whereas Section 9 can provide interim protective relief in aid of arbitration. The Court granted protection against creation of third-party rights.
Ratio:
The doctrine of election does not automatically prevent a party from pursuing two statutory mechanisms where the nature and purpose of the reliefs are different. A RERA remedy and interim arbitral protection can coexist.
Practical Impact:
Homebuyers should distinguish between the substantive relief sought before RERA and protective/interim measures sought under arbitration law. A prior RERA complaint does not necessarily foreclose Section 9 relief.
Relevant RERA Sections:
Section 31 — complaint; Section 18 — substantive allottee remedies; Section 79 — jurisdictional framework.
Related provision:
Section 9, Arbitration and Conciliation Act, 1996.
