Mr Nayan Anilkumar Bhayani Vs Bridge Fintech Solutions Private Limited

MR NAYAN ANILKUMAR BHAYANI S/O SRI ANILKUMAR HARIDAS BHAYANI, AGED ABOUT 49 YEARS, R/AT NO. 3/3, FIVE STAR CHS LIMITED, 27 BUND GARDEN ROAD, PUNE - 411001

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…PETITIONER

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(BY SRI. NIKHIL K.,ADVOCATE)

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AND:

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Digitally signed by KIRAN KUMAR R Location: HIGH COURT OF KARNATAKA

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BRIDGE FINTECH SOLUTIONS PRIVATE LIMITED (CIN U74999MH2016PTC286583) HAVING ITS REGISTERED OFFICE AT L AND T CRESCENT BAY, T-5, 2002, JERBAI WADIA ROAD, PAREL, MUMBAI - 400012 REPRESENTED BY ITS DIRECTOR MR AMIT MORE

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MR. AMIT MORE, LAND T CRESCENT BAY, T5, 2002, JERBAI WADIA ROAD, PAREL MUMBAI CITY, MAHARASHTRA 400012

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MR. ABHINANDAN SANGAM, 306, AISHWARYA II, DAFFODILS LAYOUT,

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NC: 2025:KHC:27121 CMP No. 217 of 2025

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HC-KAR

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S D BED LAYOUT, SRINIVAGULU MAIN ROAD, KORAMANGALA, 4^TH BLOCK, BANGALORE -560047

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MR. VISHWAS DIXIT, A1, 203, TOPAZ, SJR LUXURIA, 456, KOTHNUR CROSS, ARAKERE, BANGALORE 560076

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…RESPONDENTS

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(BY SRI. LAKSHMI MENON, ADVOCATE)

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THIS CIVIL MISC. PETITION FILED UNDER SEC.11(6) OF ARBITRATION AND CONCILIATION ACT 1996., PRAYING TO APPOINT A SOLE ARBITRATOR TO ADJUDICATE THE DISPUTES BETWEEN THE PETITIONER AND THE RESPONDENTS ARISING OUT OF THE LOAN AGREEMENT DATED 18.08.2020 CONTAINED IN ANNEXURE - A AS PER THE ARBITRATION CLAUSE 11 CONTAINED THEREIN.

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

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CORAM: HON'BLE MR. JUSTICE ASHOK S.KINAGI

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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, ‘ the Act ’) for the appointment of an arbitrator in terms of Clause 11 of the Loan Agreement dated 18.08.2020, vide Annexure-A.

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NC: 2025:KHC:27121 CMP No. 217 of 2025

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HC-KAR

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

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The petitioner advanced a sum of Rs.67,00,000/- to respondent No.1 in two tranches, repayable with 20% interest per annum, which remained unpaid despite repeated demands. The respondents audited the financial statements for the Financial Years 202223 and 2023-24, acknowledging the outstanding debt. On 05.02.2025, the petitioner invoked the arbitration clause and nominated Sri.S.Siddalingesh, Retired District and Session Judge as the sole arbitrator; however, the respondents failed to respond or concur within the stipulated period. Meanwhile, apprehending the dissipation of assets due to the 1^st respondent’s proposed business transfer, the petitioner filed an application under Section 9 of the Act in Arbitration Application No.97/2025. The commercial Court granted an exparte ad interim injunction on 13.02.2025. As no

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HC-KAR

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consensus on the arbitrator has been reached, the petitioner was constrained to invoke the arbitration clause for the appointment of an independent arbitrator in accordance with the Agreement. Hence, this petition.

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Respondents filed a statement of objections raising several grounds and prayed to dismiss the petition.

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Heard the arguments of the learned counsel for the petitioner and the learned counsel for the respondents.

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Learned counsel for the petitioner submits that the respondents have taken a loan from the petitioner and failed to repay the same with interest. There is an arbitration clause in the Loan Agreement dated 18.08.2020. The petitioner invoked an arbitration clause by issuing an arbitration notice and suggesting an arbitrator. The respondent did not respond within the stipulated time. As there was no consensus

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HC-KAR

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between the parties to the petition, a dispute arose and the petitioner was constrained to invoke the arbitration clause. Hence, he prays to allow the petition.

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Learned counsel for the respondents submits that the respondents have formally filed a statement of objections; however, the respondents have no objection to allow the petition.

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Perused the records and considered the submissions of the learned counsel for the parties to the petition.

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The point that arise for consideration in this petition is as follows:

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“ Whether the petitioner has made out a ground to refer the arbitral dispute to an arbitrator in terms of Clause 11 of the Loan Agreement dated 18.08.2020 as per the provisions of the Arbitration and Conciliation Act, 1996 and Rules? ”

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NC: 2025:KHC:27121 CMP No. 217 of 2025

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HC-KAR

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It is not in dispute that the respondents have

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obtained a loan from the petitioner and agreed to pay the interest at the rate of 20% per annum. The respondents failed to repay the loan amount despite the requests made by the petitioner. The petitioner filed an application under Section 9 of the Act before the Commercial Court. The Commercial Court granted an ex parte ad interim order. No consensus on the arbitration has been reached between the parties. In the Loan Agreement, there is an arbitration clause which reads as follows:

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“ 11. ARBITRATION AND

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CONCILIATION:

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In the event of any dispute, difference or question arising between the Parties hereto in relation to or in connection with anything to be done under this Agreement and the same remains unresolved for a period of one month, despite the mediation of the respective Parties' authorized persons, it shall be referred to arbitration before the arbitrator appointed

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NC: 2025:KHC:27121 CMP No. 217 of 2025

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HC-KAR

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mutually by both the Parties, in accordance with the Indian Arbitration and Conciliation Act, 1996 and the rules framed thereunder. The award given under the said process shall be final and binding on the Parties The seat and venue of arbitration proceedings shall be Bengaluru, Karnataka. Cost of arbitration shall be equally borne by the Lender and the Borrower. The Parties shall bear their own legal costs. The arbitrator shall have the authority to pass appropriate orders as to costs.”

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From the bare reading of the aforesaid arbitration

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clause, it is clear that if any dispute or difference arise about the Loan Agreement, the arbitral dispute has to be referred to the arbitration. The petitioner invoked the arbitration clause by issuing an arbitration notice dated 05.02.2025. The respondents replied to the arbitration notice via email, calling the petitioner for a settlement, but did not concur with the appointment of an arbitrator.

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NC: 2025:KHC:27121 CMP No. 217 of 2025

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HC-KAR

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Admittedly, there is an arbitration clause in the Loan Agreement dated 18.08.2020, and the arbitral dispute arose between the parties to the petition and must be resolved through arbitration. The petitioner has made out a ground to refer the arbitral dispute to

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the arbitrator.

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In view of the above discussion, I proceed to pass the following order :

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ORDER

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(i) This Civil Miscellaneous petition is allowed .

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(ii) Shri. Mallikarjun N. Saunshi, the retired District Judge, is nominated as an arbitrator to resolve disputes between the parties to the petition in accordance with the provisions of the Arbitration and Conciliation Act, 1996 and the Rules.

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