M/S. SARATHI PERFUMERY WORKS, (REGISTERED PARTNERSHIP FIRM), NO.13, 3 v. M/S. MAIYAS RESTAURANTS PRIVATE LIMITED, by DHARMALINGAM

NO.49 (OLD NO.540), 10TH MAIN, 32ND CROSS, 4TH BLOCK, JAYANAGAR, BENGALURU - 560 011. REPRESENTED BY ITS DIRECTORS, DR. P. SADANANDA MAIYA AND MR. P. SUDARSHAN MAIYA.

2. DR. P. SADANANDA MAIYA, DIRECTOR OF M/S. MAIYAS RESTAURANTS PRIVATE LIMITED, R/AT NO.53, 7TH B. MAIN, 32ND CROSS, 4TH BLOCK JAYANAGAR, BANGALORE - 560 011.

3. MR. P. SUDARSHAN MAIYA, DIRECTOR OF M/S. MAIYAS RESTAURANTS PRIVATE LIMITED, - 2 - NC: 2024:KHC:24904 CMP No. 826 of 2022 R/AT NO.53, 7TH B MAIN, 32ND CROSS, 4TH BLOCK JAYANAGAR, BANGALORE - 560 011. …RESPONDENTS (BY SRI. SRIDHAR G., ADVOCATE) THIS CIVIL MISC. PETITION IS FILED UNDER SEC.11(6) OF THE ARBITRATION AND CONCILIATION ACT 1996, PRAYING TO APPOINT A SOLE ARBITRATOR TO ADJUDICATE THE DISPUTES THAT HAVE ARISEN BETWEEN THE PETITIONER AND THE RESPONDENTS, OUT OF THE THIRD LEASE AGREEMENT AND SECOND AMENDMENT TO THE THIRD LEASE AGREEMENT, PRODUCED AT ANNEXURE-B DATED 05/08/2019 AND C2 08/05/2020. THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, THE COURT MADE THE FOLLOWING: ORDER R.DEVDAS J., (ORAL): This Civil Miscellaneous Petition is filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 seeking appointment of a sole arbitrator to resolve the dispute between the parties in terms of Clause 28 of the Lease Agreement dated 05.08.2019.

2. After notice was issued to the respondents, the respondents have entered appearance and they are represented by learned counsel. Objections are sought to - 3 - NC: 2024:KHC:24904 CMP No. 826 of 2022 be raised at the hands of learned counsel for the respondents, stating that the lease agreement dated

05.08.2019, under which the petitioner is invoking the jurisdiction of this Court for the appointment of an arbitrator to decide the lis, is a document that is compulsory registrable and the document is not registered; the document insufficiently stamped; respondent Nos.2 and 3 have been arrayed as party respondents to the proceedings in their individual capacity, which should not have been done by the petitioners. In order to support the contention of the learned counsel, the learned counsel sought to place reliance on the decision of the Hon'ble Supreme Court in the case of VIDYA DROLIA AND OTHERS., VS. DURGA TRADING CORPORATION (2021) 2 SCC 1. (hereinafter referred to as 'Vidya Drolia')

3. However, learned counsel for the petitioner submits that the decision in Vidya Drolia has been re- considered by the larger bench of the Hon'ble Supreme Court in Re-Interface between the arbitration - 4 - NC: 2024:KHC:24904 CMP No. 826 of 2022 agreements under the Arbitration and Conciliation Act, 1996 and the Indian Stamp Act, 1899, (2023) SCC Online SC 1666, and the Larger Bench has clearly held in para Nos.159 that the decision in Vidya Drolia has been over ruled insofar as its opinion regarding the sufficiency of the stamp, etc and whether such an issue should be considered by the Court while considering an application under Section 11 of the 1996 Act, and has specifically held that the opinion in Vidya Drolia proceeded under the premise that Section 11(6A) was omitted by amendment Act 33/2019 (w.e.f 09.08.2019). However, the Larger Bench has held that Section 11(6A) continues to remain inforce and therefore, it is incumbent upon this Court to give true effect to the legislative intent.

4. The Hon'ble Supreme Court, in paragraphs commencing from 190 to 195 has dealt with the specific issue regarding such objections that could be raised at the hands of the respondents before this Court, regarding the document not being registered or insufficiently stamped. - 5 - NC: 2024:KHC:24904 CMP No. 826 of 2022 The Larger Bench of the Supreme Court has clearly held that, having regard to Section 16 of the Arbitration Act and the intent of the Parliament, the arbitral tribunal will have jurisdiction to determine all such questions and issues in dispute between the parties. The legitimate concerns of the Revenue in relation to stamp duty are not defeated because the arbitral tribunal has the jurisdiction to Act in pursuance of the provisions of the Stamp Act.

5. This court has also noticed paragraphs 229 to 233 wherein, the Larger Bench has dealt with the judgment in the case of Vidya Drolia. In conclusion, in paragraph No. 234, the Larger Bench has held that any objection as to stamping does not fall for determination under Section 8 or 11 of the Arbitration and Conciliation Act, 1996. The concerned Court must examine whether the Arbitration Agreement prima facie, exists. Any objections in relation to the stamping of the agreement fall within the ambit of the arbitral tribunal. - 6 - NC: 2024:KHC:24904 CMP No. 826 of 2022

6. Insofar as the objections raised by the learned counsel that respondent Nos.2 and 3, although are admittedly the Directors of respondent No.1 - Company, nevertheless, they have been impleaded in their individual capacity as respondent Nos.2 and 3, this Court is of the considered opinion that merely because the petitioner has thought it fit to array respondent Nos.2 and 3 although they are shown as Directors in the description in respondent No.1, it will be not constitute reasons for rejecting the petition. The arbitral tribunal is required to consider the lis arising between the parties under the lease agreement dated 05.08.2019 and all contentions on behalf of the respondent will be kept open.

7. In the light of the arbitration clause mentioned in the Agreement and the contentions advanced by the petitioner, this Court proceeds to pass the following: ORDER (a) The petition is allowed appointing Shri.H.G.Ramesh, Former Acting Chief - 7 - NC: 2024:KHC:24904 CMP No. 826 of 2022 Justice and Former Judge, High Court of Karnataka, as the sole arbitrator to enter reference of the disputes between the petitioner and the respondents and conduct proceedings at the Arbitration and Conciliation Centre (Domestic and International), Bengaluru according to the Rules governing the said Arbitration Centre. (b) All contentions inter se parties are left open for adjudication in the arbitration proceedings. (c) The office is directed to communicate this order to the Arbitration and Conciliation Centre and to Shri.H.G.Ramesh, Former Acting Chief Justice and Former Judge, High Court of Karnataka, as required under the Arbitration and Conciliation Centre Rules, 2012. TIN List No.: 1 Sl No.: 18 Sd/- JUDGE