M/S. Hiveloop Technology Private Limited Vs M/S. Clomoso Technologies Private Limited

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NC: 2025:KHC:2019 CMP No. 14 of 2023

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 17^TH DAY OF JANUARY, 2025

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BEFORE

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THE HON'BLE MR JUSTICE SACHIN SHANKAR MAGADUM CIVIL MISC. PETITION NO. 14 OF 2023

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BETWEEN:

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M/S. HIVELOOP TECHNOLOGY PRIVATE LIMITED, A COMPANY INCORPORATED UNDER THE COMPANIES ACT 2013, HAVING ITS REGISTERED OFFICE AT 1090G, 18TH CROSS, 14TH MAIN SECTOR-3, HSR LAYOUT, BENGALURU - 560 102, REPRESENTED BY ITS DIRECTOR MS. LAKSHMI RAJAGOPALAN. …PETITIONER (BY SRI. PRATEEK RATH, ADVOCATE)

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AND:

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Digitally signed by NAGARAJA B M Location: HIGH COURT OF KARNATAKA

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M/S. CLOMOSO TECHNOLOGIES PRIVATE LIMITED, HAVING ITS REGISTERED OFFICE AT NO. 1515, GROUND FLOOR, 19TH MAIN ROAD, AGARA, HSR LAYOUT, 1ST SECTOR, BENGALURU - 560 102. ALSO AT: 3RD FLOOR, REVANNAS BUILDING, NO. 1564, 27TH MAIN ROAD, HSR LAYOUT, SECTOR 2, BENGALURU - 560 102. REPRESENTED BY ITS DIRECTORS SRI. GANESH KUMAR BODDEPALLI AND NAGI REDDY SUBBA REDDY VENKATA. …RESPONDENT (VIDE ORDER DATED 18.12.2024, NOTICE TO RESPONDENT IS HELD SUFFICIENT)

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NC: 2025:KHC:2019 CMP No. 14 of 2023

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THIS CIVIL MISC. PETITION IS FILED UNDER SEC.11 THE ARBITRATION AND CONCILIATION ACT, 1996 READ WITH RULE 2 OF THE APPOINTMENT OF ARBITRATORS BY THE CHIEF JUSTICE OF KARNATAKA HIGH COURT SCHEME 1996, PRAYING TO APPOINT HONBLE MR. JUSTICE PATRI BASAVANA GOUD, AS THE ARBITRATOR TO ADJUDICATE AND DECIDE THE DISPUTES AND DIFFERENCES BETWEEN THE PETITIONER AND THE RESPONDENT IN CONNECTION WITH THE LEASE AGREEMENT DATED 03.12.2018 (ANNEXURE A), WITH THE SEAT AND VENUE OF THE ARBITRATION PROCEEDINGS BEING IN BENGALURU AND GRANT ANY OTHER ORDER(S) THAT THIS HONBLE COURT DEEMS FIT AND PROPER IN THE FACTS AND CIRCUMSTANCES OF THIS CASE, IN THE INTEREST OF JUSTICE AND EQUITY.

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THIS PETITION, COMING ON FOR ADMISSION, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

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CORAM: HON'BLE MR JUSTICE SACHIN SHANKAR MAGADUM

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ORAL ORDER

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This Civil Miscellaneous Petition is filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 ( for short, 'Act') seeking appointment of a sole arbitrator to resolve the dispute and difference between the parties

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NC: 2025:KHC:2019 CMP No. 14 of 2023

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herein in terms of clause 14 of the lease agreement dated 03.12.2018 vide Annexure-B.

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Learned counsel for the petitioner respectfully submits that the petitioner and the respondent entered into a lease agreement on 03.12.2018, whereby the petitioner was granted possession of the subject premises on a leasehold basis. As per the terms of the agreement, specifically clause 2(h), the petitioner, at the time of executing the lease agreement, paid the respondent a refundable security deposit amounting to Rs. 20,97,600/-. Petitioner asserts that it was expressly stipulated in the agreement that upon the petitioner vacating the premises and handing over possession to the respondent, the latter was obligated to refund the security deposit without any delay. Furthermore, the agreement provided that in the event of a failure to refund the security deposit upon handover of the premises, the respondent would be liable to pay interest at the rate of 18% per annum on the

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NC: 2025:KHC:2019 CMP No. 14 of 2023

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outstanding security deposit amount until full and final payment was made.

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The lease was initially granted to the petitioner for a fixed term of three months, commencing from 12.12.2018. However, through subsequent extensions, the lease term was extended until 05.09.2019. Upon completion of the lease period, the petitioner duly vacated the subject premises and formally requested the respondent to refund the security deposit, including the accrued interest as per the terms of the agreement. The alleges that respondent, despite acknowledging its liability and obligation to refund the security deposit, failed to fulfill its commitment. Despite repeated reminders and multiple legal notices issued by the petitioner, the respondent neither refunded the principal deposit amount nor paid any interest due thereon.

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Owing to the respondent’s continued noncompliance and failure to adhere to the contractual obligations, the petitioner was left with no alternative but

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NC: 2025:KHC:2019 CMP No. 14 of 2023

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to invoke the arbitration clause under clause 14 of the lease agreement. Accordingly, the petitioner issued an arbitration notice seeking the appointment of an arbitrator to adjudicate and resolve the dispute arising from the respondent’s failure to refund the security deposit and the consequential interest payable thereon.

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Though notice is served on the respondent company, it remained unrepresented.

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After a thorough review of the petition, annexures and supporting documents, this Court is satisfied that the petitioner has met the procedural requirements outlines under Section 11(4) of the Arbitration and Conciliation Act.

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In the light of the aforesaid clause of arbitration

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and the contentions advanced by the petitioner the following order is passed:

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NC: 2025:KHC:2019 CMP No. 14 of 2023

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ORDER

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(a) The petition is allowed appointing Shri

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H.M. Nanjundaswamy, Retired District Judge, as the sole arbitrator to enter reference of the disputes between the petitioner and the respondents and conduct proceeding at the Arbitration and Conciliation Centre (Domestic and International), Bengaluru according to the Rules governing the said Arbitration Centre.

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(b) All contentions inter se parties are left

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open for adjudication in the arbitration proceedings.

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