MISC. Petition No. 395 of 2024 · The High Court
Case Details
- 1 - NC: 2025:KHC:22800 CMP No. 395 of 2024 HC-KAR IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 27TH DAY OF JUNE, 2025 BEFORE THE HON'BLE MR JUSTICE ASHOK S.KINAGI CIVIL MISC. PETITION NO. 395 OF 2024 BETWEEN: M/S MANN AND HUMMEL FILTER PRIVATE LIMITED A COMPANY INCORPORATED UNDER THE PROVISIONS OF THE COMPANIES ACT 1956 HAVING ITS REGISTERED OFFICE AT 2ND FLOOR PRASAD ENCLAVE, 118/119 5TH MAIN INDUSTRIAL SUBURB, 2ND STAGE YESHWANTHPUR, BANGALORE 560022 REP. HEREIN BY ITS AUTHORIZED SIGNATORY AJITH RAJ NAIR. (BY MS. VAISHNAVI NAIK., ADVOCATE) …PETITIONER AND: NAGSON AND CO A PARTNERSHIP FIRM REGISTERED UNDER THE PARTNERSHIP ACT 1932, HAVING ITS REGISTERED OFFICE AT NO.42, INDUSTRIAL SUBURB YESHWANTHPUR, 2ND STAGE BANGALORE 560022 REP. BY ITS PARTNER K N BALASUBRAMANYAM. (RESPONDENT SERVED) …RESPONDENT
Legal Reasoning
Digitally signed by SUNITHA K S Location: HIGH COURT OF KARNATAKA - 2 - NC: 2025:KHC:22800 CMP No. 395 of 2024 HC-KAR THIS CIVIL MISC. PETITION IS FILED UNDER SEC.11(6) OF THE ARBITRATION AND CONCILIATION ACT, 1996 PRAYING TO APPOINT HON’BLE MR. JUSTICE ANAND BYRAREDDY (RETD. JUDGE, HON’BLE HIGH COURT OF KARNATAKA) OR ANY OTHER PERSON THAT THIS HON’BLE COURT MAY DEEM FIT, AS THE SOLE ARBITRATOR TO ADJUDICATE THE DISPUTES THAT HAVE ARISEN BETWEEN THE PARTIES OUT OF THE CLAUSE 37 THE LETTER OF INTENT DATED 11.08.2022 (ANNEXURE A). THIS PETITION, COMING ON FOR ADMISSION, 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 for the appointment of an arbitrator to resolve the dispute between the parties to the petition in terms of clause No. 37 of the Letter of Intent dated 11.08.2022 vide Annexure-A. 2. Brief facts leading rise to the filing of this petition are as follows: The petitioner was looking for commercial space to set up an office and lab. The respondent offered its property for lease to the petitioner and the parties - 3 - NC: 2025:KHC:22800 CMP No. 395 of 2024 HC-KAR executed the Letter of Intent dated 11.08.2022. The petitioner paid a sum of Rs.55,51,013/- towards a partial security deposit in pursuance of the Letter of Intent. However, various disputes arose between the parties, even resulting in the termination of Letter of Intent, on 15.06.2023, and the petitioner sought for a refund of the security deposit. The parties have exchanged the legal notices. The petitioner invoked the arbitration clause by issuing an arbitration notice under Section 21 of the Arbitration and Conciliation Act, 1996 on 25.01.2024 to the respondent. Despite the service of arbitration notice, the respondent neither replied to the legal notice, nor accepted the proposal of the name of the arbitrator. Hence, this petition. 3. Notice was issued to the respondent. Despite the service of notice, the respondent remained unrepresented. - 4 - NC: 2025:KHC:22800 CMP No. 395 of 2024 HC-KAR
Legal Reasoning
4. Heard the arguments of Ms. Vaishnavi Naik, learned counsel for the petitioner. 5. Learned counsel for the petitioner submits that the parties to the petition have entered into a Letter of Intent and the Letter of Intent was terminated and the respondent is liable to refund the partial security deposit amount. Despite issuing several demand notices, the respondent did not repay the partial security deposit. The petitioner invoked the arbitration clause by issuing an arbitration notice. The respondent did not respond to the arbitration notice. She submits that there is an arbitration clause and the dispute between the parties to the petition must be resolved through arbitration. Hence, she prays to allow the petition. 6. Perused the records and considered the submissions of the learned counsel for the petitioner. 7. The point that arise for consideration is as follows: - 5 - NC: 2025:KHC:22800 CMP No. 395 of 2024 HC-KAR “Whether the petitioner has made out a ground to refer the dispute to the arbitrator as per clause No.37 of the Letter of Intent dated 11.08.2022 as per the provisions of the Arbitration and Conciliation Act and Rules?” 8. There is no dispute regarding the execution of the Letter of Intent between the parties to the petition on 11.08.2022. Pursuant to the execution of the Letter of Intent, the petitioner paid Rs.55,51,013/- towards a partial security deposit. Subsequently, due to various disputes between the parties, the petitioner terminated the Letter of Intent as per the termination notice dated 15.06.2023, and called upon the respondent to return the partial security deposit. The respondent replied to the termination notice. Thereafter, the petitioner got issued a legal notice to the respondent on 05.08.2023, calling upon the respondent to refund the security deposit. The respondent replied to the legal notice vide reply notice dated 25.08.2023 on untenable grounds. The petitioner issued an arbitration notice dated 25.01.2024 under - 6 - NC: 2025:KHC:22800 CMP No. 395 of 2024 HC-KAR Section 21 of the Arbitration and Conciliation Act. The Letter of Intent provides an arbitration clause that reads as follows: 37. Arbitration: All disputes and differences claims and questions whatsoever which could arise either during the subsistence of this LOI or afterwards between the parties and/or their respective representatives or any clause or thing herein contained or otherwise in any way relating to or arising from these present shall be referred to Arbitration and shall be subject to the jurisdiction of the courts at Bengaluru. The Arbitration shall be conducted by sole Arbitrator jointly appointed by parties and the seat and language of Arbitration shall be Bengaluru and English respectively. 9. From the perusal of clause No.37 of the Letter of Intent it provides an arbitration clause that if any dispute or differences, claims and question whatsoever arise between the parties, the same shall be referred to the arbitration. Admittedly, the dispute has arisen between the petitioner and respondent regarding the - 7 - NC: 2025:KHC:22800 CMP No. 395 of 2024 HC-KAR refund of a partial security deposit. The said dispute has to be resolved through arbitration. Thus, there is an arbitration clause exists in the Letter of Intent, and the same has to be resolved through arbitration. In view of the above discussion, the petitioner has made out a ground to refer the dispute to the arbitrator. In view of the above discussion, I answer the point for consideration in the affirmative. 10. Accordingly, I proceed to pass the following:
Decision
ORDER i. The Civil Miscellaneous Petition is allowed. ii. Hon’ble Dr. Justice H.B.Prabhakara Sastry, Former Judge, the High Court of Karnataka, is nominated as an arbitrator to resolve the dispute between the parties to the petition in terms of clause No.37 of the Letter of Intent and as per the provisions of the Arbitration and Conciliation Act, 1996 and the Rules. - 8 - NC: 2025:KHC:22800 CMP No. 395 of 2024 HC-KAR iii. Office is directed to communicate a copy of this order to the learned arbitrator and the Arbitration and Conciliation Centre, Bengaluru. In view of the disposal of the petition, the pending IA’s, if any, stand disposed of. Sd/- (ASHOK S.KINAGI) JUDGE SKS