Pettakanddy Musthafa Vs Rajasekhar Gowrineni

RAJASEKHAR GOWRINENI, S/O MOHAN RAO, AGED ABOUT 47 YEARS, PARTNER, M/S 12STAY LLP, NO.47/9, JAIPLAAZA SYMPHONY, 2ND FLOOR, 9TH MAIN, 14TH CROSS SECTOR 6, HSR LAYOUT, BENGALURU - 560 102.

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M/S. 12STAY LLP, REP. BY ITS MANAGING PARTNER, NO.47/9, JAIPLAAZA SYMPHONY, 2ND FLOOR, 9TH MAIN, 14TH CROSS, SECTOR 6, HSR LAYOUT, BENGALURU - 560 102.

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…RESPONDENTS

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(BY SRI. HARISH H.V, ADVOCATE FOR R1; R2 - SERVED)

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THIS CIVIL MISC. PETITION UNDER SECTION 11 (6) OF THE ARBITRATION AND CONCILIATION ACT, 1996, PRAYING TO I) APPOINT AN ARBITRATOR FOR RESOLUTION OF ALL THE DISPUTES EXISTING BETWEEN THE PETITIONER AND THE RESPONDENTS PERTAINING TO THEIR TENANCY IN THE SCHEDULE PROPERTY AND THE OTHER RELATED MATTERS IN FURTHERANCE OF THE EXECUTION OF THE MANAGEMENT AND OPERATIONS SERVICES AGREEMENT DATED 06.02.2019 WHICH CONTAINS ARBITRATION CLAUSE VIDE CLAUSE NO. 13.2 THEREOF AT ANNEXURE A.

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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 ASHOK S.KINAGI

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3 - NC: 2025:KHC:21839 CMP No. 153 of 2023

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HC-KAR

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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 (‘the Act, 1996’ for brevity) for the appointment of an Arbitrator in terms of Clause 13.2 of the Management and Operations Services Agreement dated 06.02.2019 to resolve the disputes between the petitioners and the respondents as per the provisions of the Arbitration and Conciliation Act, 1996 and Rules.

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Brief facts, leading rise to the filing of this petition are as follows:

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The petitioners had purchased the petition schedule property on 04.02.2019. The respondents were inducted in possession of the schedule property as a tenant/lessee under the contract of Management and Services Agreement dated 06.02.2019. The petitioners terminated the tenancy by issuing a notice dated 17.09.2022. The respondents replied to the termination notice and failed to concede to the demands made in the legal notice. The

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HC-KAR

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petitioners filed a civil miscellaneous petition in

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CMP.No.889/2022. The same was withdrawn with a liberty to file a fresh petition after issuing notice under Section 21

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of the Act, 1996 on 01.02.2023. The said notice was served on the respondents. The respondents failed to concede for the appointment of an arbitrator and the respondents vacated the schedule property in a damaged condition and deserted the same after intimation to the petitioners. The respondents have not settled the claims of the petitioners. Hence, this petition.

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The respondents have not filed the statement of

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objections.

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Heard the arguments of learned counsel for the petitioners and also learned counsel for the respondents.

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Learned counsel for the petitioners submits that

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the petitioners and the respondents have entered into the Management and Operations Services Agreement dated 06.02.2019. The petitioners have terminated the tenancy

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HC-KAR

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of the respondents by issuing a legal notice. The respondents have denied the claim made in the legal notice. The petitioners issued an arbitration notice in terms of Clause 13.2 of the Management and Operations Services Agreement dated 06.02.2019. The respondents

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did not reply. Hence, he submits that there is an arbitration clause in the agreement and the dispute arises between the parties to the petition and the same has to be resolved through an arbitration. Hence, he prays to allow the petition.

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Per contra, learned counsel for the respondents objected to allow the petition on several grounds, that the sub contractor are not made as a party, the Management and Operations Services Agreement was not duly stamped, and the same is inadmissible and the claim of the petitioner is barred by limitation. Hence, he submits that the respondents may be permitted to raise all these grounds before the arbitral tribunal. Hence, he prays to dispose of the petition.

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HC-KAR

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Perused the records, and considered the

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submissions of the learned counsel for the parties.

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The point, that arises for consideration is as

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follows:

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“Whether the petitioners made out a ground to refer the dispute to the Arbitrator in terms of clause 13.2 of the Management and Operations Services Agreement dated 06.02.2019 vide Annexure-A, as per the provisions of the Arbitration and Conciliation Act, 1996 and the Rules?”

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There is no dispute regarding the execution of the Management and Operations Services Agreement dated 06.02.2019 between the petitioners and the respondents. The petitioners terminated the tenancy of the respondents by issuing a notice dated 17.09.2022, and they made a claim against the respondents. The respondents replied to the legal notice dated 17.09.2022 vide reply notice dated 03.11.2022 denying the claim made by the petitioners in the legal notice dated 17.09.2022. The petitioners invoked an arbitration clause and filed a civil miscellaneous petition in

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HC-KAR

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CMP.No.889/2022. The petitioners had withdrew the said petition with the liberty to file a fresh petition after issuing a fresh arbitration notice under Section 21 of the Act, 1996. The petitioners issued an arbitration notice on 01.02.2023 requesting to propose the name of the arbitrator. The respondents did not reply to the arbitration notice. As there is an arbitration clause in the Management and Operations Services Agreement dated 06.02.2019 which reads as under:

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Clause 13.2: All disputes between the Parties shall initially be endeavoured to be settled though amicable discussions between the Parties across the table. In the event that discussions do not result in a resolution of the differences between the Parties, the Parties agree to refer the matter to arbitration by a sole arbitrator appointed through written consent of both Parties in accordance with the provisions regarding arbitrator appointment contained in the Arbitration and Conciliation Act, 1996 as amended from time to time. All arbitration proceedings shall be held in accordance with the procedure for arbitral proceedings set out in the Arbitration and Conciliation Act, 1996 and proceedings shall be in the English language. The final award passed by the sole arbitrator shall be final and

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HC-KAR

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binding on both Parties. The seat of arbitration shall be Bengaluru, Karnataka."

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From the perusal of the arbitration clause, it

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provides that any dispute between the parties shall be settled through an amicable discussion between the parties across the table. In the event that the discussion does not result in a resolution of the difference between the parties, the parties shall refer the dispute to arbitration by the sole arbitrator.

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Admittedly, an agreement was executed between the parties to the petition and the dispute has arose between the parties to the petition and the same has to be resolved through an arbitrator in terms of Clause 13.2 of the agreement dated 06.02.2019. Thus, the petitioners have made out grounds to refer the dispute to the arbitrator. Though the respondents have raised several grounds, the scope of application under Section 11(6) of the Act, 1996 is very limited. This Court has to examine, under Section 11(6) of the Act, 1996, where there exists

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HC-KAR

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an arbitration clause or not? As observed above, there is

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an arbitration clause.

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In view of the above discussion, I answer the point

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for consideration in the affirmative.

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Accordingly, I proceed to pass the following:

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ORDER

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i. The Civil Miscellaneous Petition is allowed.

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ii. Hon’ble Justice Sri. S.R.Somasekhara, Retired District Judge, is nominated as the sole Arbitrator to resolve the dispute between the parties to the petition in terms of clause 13.2 of the agreement dated 06.02.2019 as per the provisions of the Arbitration and Conciliation Act, 1996 and the Rules.

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iii. The office is directed to communicate this order to the learned sole Arbitrator and the Arbitration and Conciliation Centre, Bengaluru.

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iv. All the contentions of the parties are kept open.

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Sd/(ASHOK S.KINAGI) JUDGE

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SSB CT: BHK

Pettakanddy Musthafa v. Rajasekhar Gowrineni

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Pettakanddy Musthafa v. Rajasekhar Gowrineni

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