MISC. Petition No. 91 of 2025 · The High Court
Case Details
- 1 - NC: 2025:KHC:18198 CMP No. 91 of 2025 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 22ND DAY OF APRIL, 2025 BEFORE THE HON'BLE MR JUSTICE ASHOK S.KINAGI CIVIL MISC. PETITION NO. 91 OF 2025 BETWEEN: SATCHMO HOLDINGS LIMITED (FORMERLY M/S NEL HOLDINGS SOUTH LIMITED AND PRIOR TO THAT, KNOWN AS NITESH ESTATES LIMITED A COMPANY INCORPORATED UNDER COMPANIES ACT, 1956, NO. 110, A WING, ANDREWS BUILDING, LEVEL 1, M.G. ROAD, BANGALORE- 560001 REPRESENTED BY ITS SENIOR GENERAL MANAGER AND AUTHORISED SIGNATORY. MR. JAGANATHAN (BY SRI. K.N. PHANEENDRA, SR. COUNSEL FOR SRI. KRUTIKA RAGHAVAN, ADVOCATE) …PETITIONER AND: 1. ALPHA DEVANAHALLI PROPERTIES LLP (PREVIOUSLY ALPHA DEVANAHALLI PROPERTIES PRIVATE LIMITED) A LIMITED LIABILITY PARTNERSHIP, INCORPORATED UNDER THE LIMITED LIABILITY PARTNERSHIP ACT, 2008 HAVING OFFICE AT NO. 135/A-35, 9TH MAIN, RMV EXTENSION, SADASHIVANAGAR BANGALORE - 560080 ALSO AT NO. 210/2, BELLARY ROAD, SADASHIVANAGAR, BANGALORE-560080 Digitally signed by SUNITHA K S Location: HIGH COURT OF KARNATAKA - 2 - NC: 2025:KHC:18198 CMP No. 91 of 2025 2. ROCKY RAI, INDIAN ADULT, 7E/26-27, RASMAHAN APARTMENT, 8TH CROSS, 9TH MAIN ROAD, RMV EXTENSION, SADASHIVNAGAR, BANGALORE 560080 3. RICKY RAI 7E/26-27, RASMAHAN APARTMENT, 8TH CROSS, 9TH MAIN ROAD, RMV EXTENSION, SADASHIVNAGAR, BANGALORE 560080 4. B. G. CHANNAPPA
Legal Reasoning
S/O. LATE MR. H. GURUSIDAPPA, AGED ABOUT 70 YEARS, RESIDING AT NO. 135/A-35, 9TH MAIN ROAD, RMV EXTENSION, SADASHIVNAGAR, BANGALORE – 560080 5. DHANYA KUMAR, S/O. B. G. CHANAPPA AGED ABOUT 40 YEARS, R/ AT NO. 135/A-35, 9TH MAIN ROAD, RMV EXTENSION SADASHIVNAGAR, BANGALORE - 560080 (BY SRI. BADRI VISHAL, ADVOCATE FOR R1 TO R3 R4 & R5 ARE SERVED) …RESPONDENTS THIS CIVIL MISCELLANEOUS PETITION IS FILED UNDER SEC.11(6) OF ARBITRATION AND CONCILIATION ACT 1996., PRAYING TO EXERCISE ITS JURISDICTION AND POWER UNDER SEC.11(6) OF THE ARBITRATION AND CONCILIATION ACT, 1996 AND TO APPOINT AN ARBITRAL TRIBUNAL, AS PER CLAUSE 3 THE SECOND SUPPLEMENTARY AGREEMENT DATED 28.04.2017 (ANNEXURE A3), AND CLAUSE 10 IN THE THIRD - 3 - NC: 2025:KHC:18198 CMP No. 91 of 2025 SUPPLEMENTARY AGREEMENT DATED 29.04.2023 (ANNEXURE A5) TO ADJUDICATE AND RESOLVE THE DISPUTES THAT HAVE ARISEN UNDER THE AGREEMENTS (ANNEXURE A - A5) BETWEEN THE PETITIONER AND THE RESPONDENTS. THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE ASHOK S.KINAGI ORAL ORDER This Civil Miscellaneous Petition is filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as Act, 1996 for short) for the appointment of an Arbitrator as per clause 3 of the 2nd supplementary agreement dated 28.04.2017 vide Annexure -A3 and clause No.10 in the third supplementary agreement dated 29.04.2023 vide Annexure -A5 to resolve the dispute between the petitioner and the respondents. 2. The brief facts leading rise to the filing of this petition are as follows: Respondents No.1 to 3 are the owners of the lands measuring 43 acres 1.15 guntas, situated at Guttahalli - 4 - NC: 2025:KHC:18198 CMP No. 91 of 2025 Village, Kasaba Hobli, Devanahalli Taluk, approached the petitioner with a proposal to develop the property into a residential plotted developed area with the amenities including a club house and commercial space. Pursuant to the discussions, the petitioner and the respondents entered into the registered joint venture agreement dated 18.12.2013. 3. The joint venture agreement provides specific timelines for the commencement and completion of the construction work. The petitioner and the respondents entered into first supplementary agreement on 28.02.2014 with stipulated clear timelines, including grace period. Respondent No.1 failed to complete the construction as contemplated under the supplementary agreement dated 28.02.2014, and the second supplementary agreement was executed on 28.04.2017 extend the time for completing the construction. Despite revised timelines under the second supplementary agreement and subsequent meetings, respondent No.1 did not complete - 5 - NC: 2025:KHC:18198 CMP No. 91 of 2025 the construction within the specific timelines. Consequently, a third supplementary agreement was executed on 29.04.2023 for completion of remaining development and civil works, and respondent No.1 breached the said supplementary agreement, despite sending multiple legal notices and reminders and failed to take any corrective measures. 4. The petitioner filed a commercial Arbitration Application No.450/2024 against the respondents before the learned 89th Additional City Civil and Sessions Judge (CCH 90), Bengaluru and sought for an interim injunctive reliefs pending the disposal of the arbitration proceedings and also filed an application I.A.No.1, praying for an ad- interim ex-parte injunction. The learned 89th Additional City Civil and Sessions Judge allowed the application and granted an ad-interim ex-parte injunction till next date of hearing. The petitioner issued a notice under Section 21 of the Act, 1996 on 09.01.2025. The said notice was served on the respondents. The respondents failed to provide the - 6 - NC: 2025:KHC:18198 CMP No. 91 of 2025 consent for the arbitration. Hence, the petitioner is constrained to file this petition. 5. Heard Sri. K.N. Phaneendra learned Senior Counsel for Ms. Krutika Raghavan, Advocate for the petitioner and Sri. Badri Vishal, Advocate for respondents No.1 to 3. 6. Learned counsel for respondents No.1 to 3 submits no objection to allow the petition and refer the matter to the Sole Arbitrator to resolve the dispute arising under second and third supplementary agreements dated 28.04.2017 and 29.04.2023 respectively vide Annexures – A3 and A5 between the petitioner and the respondents. 7. Perused the records and considered the submissions of the learned counsel for the parties. 8. The point that arises for consideration is: “Whether the petitioner made out a ground to refer the dispute to the Arbitrator in terms of Clause 3 of the second supplementary - 7 - NC: 2025:KHC:18198 CMP No. 91 of 2025 agreement dated 28.04.2017 vide Annexure - A3 and clause 10 in the third supplementary agreement dated 29.04.2023 vide Annexure - A5” 9. It is not in dispute that the petitioner and the respondents have entered into joint a venture agreement dated 18.12.2013 and the said document was registered. The said joint venture agreement provides the specific timelines for commencement and completion of the construction work. The respondents failed to complete the construction as stipulated in the first supplementary agreement dated 28.02.2014. The second supplementary agreement was executed on 28.04.2017 and extended the time for completing the construction. Despite the extension of time respondent No.1 did not complete the construction work within the specific timelines. 10. The third supplementary agreement was executed on 29.04.2023 between the petitioner and respondent No.1. Despite the revised timelines under the - 8 - NC: 2025:KHC:18198 CMP No. 91 of 2025 supplementary agreements and subsequent meetings, respondent No.1 failed to fulfill its obligation. The petitioner filed a Com.A.A.No.450/2024 before the 89th Additional City Civil and Sessions Judge (CCH 90), Bengaluru and sought an ad-interim ex-parte injunction. The Sessions Judge was pleased to allow the application and granted ad-interim ex-parte injunction. Thereafter, the petitioner invoked the arbitration Clause by issuing a notice dated 09.01.2025. The said notice was delivered to the respondents. The respondents failed to provide their consent to the appointment of an arbitrator. 11. I have perused the joint venture agreement and supplementary agreements, which provide arbitration Clause that if the dispute arises between the petitioner and the respondents is to be resolved by an arbitrator through an arbitration. As there is an arbitration clause and the dispute has arisen between the petitioner and the respondents regarding the agreements, the matter must be referred to an Arbitrator. Further, the learned counsel - 9 - NC: 2025:KHC:18198 CMP No. 91 of 2025 for the respondents submits no objection to allow the petition. 12. In view of the above discussion, the petitioner has made out a ground to refer the dispute to the Sole Arbitrator and hence, I answer the point for consideration in the affirmative. 13. Learned counsel for the parties to the petition jointly submit that Hon’ble Sri. Ajit J. Gunjal, former Judge, the High Court of Karnataka be nominated as a Sole Arbitrator to resolve the dispute between the petitioner and the respondents. 14. In view of the above discussions, I proceed to pass the following:
Decision
ORDER The Civil Miscellaneous Petition is allowed. Hon’ble Sri. Ajit J. Gunjal, former Judge of the High Court of Karnataka is appointed as a Sole Arbitrator to resolve the dispute between the petitioner and the - 10 - NC: 2025:KHC:18198 CMP No. 91 of 2025 respondents as per the provisions of the Arbitration and Conciliation Act, 1996 and the Arbitration and Conciliation Centre Rules, 2012. The office is directed to communicate this order to the learned Sole Arbitrator and the Arbitration Centre, Bengaluru. Sd/- (ASHOK S.KINAGI) JUDGE BVK