Karnataka High Court
Sri.K.M Muddappa vs Sri. R Ramesh on 16 June, 2025
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NC: 2025:KHC:20629
CMP No. 437 of 2022
HC-KAR
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 16TH DAY OF JUNE, 2025
BEFORE
THE HON'BLE MR JUSTICE ASHOK S.KINAGI
CIVIL MISC. PETITION NO. 437 OF 2022
BETWEEN:
1. SRI.K.M MUDDAPPA
S/O SRI K S MUNIHANUMAIAH @ MUNIHANUMAIAH
AGED ABOUT 61 YEARS
2. SRI K M PATALAPPA
S/O SRI K S MUNIHANUMAIAH @ MUNIHANUMAIAH
AGED ABOUT 55 YEARS
3. SRI K M KANAKARAJ
S/O SRI K S MUNIHANUMAIAH @ MUNIHANUMAIAH
AGED ABOUT 48 YEARS
Digitally signed
by KIRAN ALL ARE RESIDING AT KALKERE VILLAGE
KUMAR R BANASWADI POST,
K R PURAM HOBLI,
Location:
HIGH COURT BANGALORE EAST TALUK
OF BANGALORE 560043
KARNATAKA ...PETITIONERS
(BY SRI. ABHISHEK N V., ADVOCATE)
AND:
SRI. R RAMESH
S/O SRI V RAMARAJU
AGED ABOUT 55 YEARS
RESIDING AT NO 240/1 13TH CROSS
OPPOSITE ANJANEYA TEMPLE
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NC: 2025:KHC:20629
CMP No. 437 of 2022
HC-KAR
SARAKKI POST, 1ST PHASE
BANGALORE 560078
...RESPONDENT
THIS CIVIL MISC. PETITION IS FILED UNDER SEC.11(5)
OF THE ARBITRATION AND CONCILIATION ACT 1996, PRAYING
THIS HON'BLE COURT TO APPOINT A SOLE ARBITRATOR TO
A) ALLOW THE ABOVE PETITION. B) APPOINT HON'BLE
JUSTICE SRI. K.N.KESHAVANARAYAN (RETD), HIGH COURT OF
KARNATAKA AS SOLE ARBITRATOR TO DECIDE THE DISPUTE
BETWEEN THE PETITIONERS AND RESPONDENT AS PER
CLAUSE 4 OF THE AGREEMENT DATED 04.12.2014 AT
ANNEXURE "C". C) CONSTITUTE AN ARBITRAL TRIBUNAL OF
SOLE ARBITRATOR TO DECIDE THE MATTER IN ISSUE
BETWEEN THE PETITIONERS AND RESPONDENT IN
ACCORDANCE WITH LAW. D) PASS ANY SUCH OTHER ORDER
OR DIRECTION THAT THIS HON'BLE COURT DEEMS FIT, IN THE
INTEREST OF JUSTICE AND EQUITY.
THIS PETITION, COMING ON FOR ADMISSION, THIS DAY,
ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE ASHOK S.KINAGI
ORAL ORDER
1. This petition is filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 (for short, 'the Act') for the appointment of an arbitrator to resolve the dispute between the petitioners and the respondent as per Clause (4) of the Full and Final Settlement Agreement dated 04.12.2014 vide Annexure 'C'.
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NC: 2025:KHC:20629 CMP No. 437 of 2022 HC-KAR
2. Brief facts leading rise to the filing of this petition are as follows:
3. The father of the petitioners, Sri.K.S.Munihanumaiah on 08.03.2006 entered into a Joint Development Agreement with the respondent with an intention for development of an immovable property bearing Survey No.511 measuring 04 acres 32 guntas along with kharab of 0-24 guntas, in all, measuring 05 acres 16 guntas situated at Kalkere Village, K.R.Puram Hobli, Bangalore East Taluk and executed a registered Deed of Assignment on 13.05.2008.
4. At the instance of respondent, K.S.Munihanumaiah and his sons, M/s.Krishil Capital Holdings Private Limited had assigned the joint development rights over the aforesaid property in favour of one M/s.Sovereign Developers and Infrastructures Limited under the Registered Joint Development Agreement dated 02.09.2009.
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NC: 2025:KHC:20629 CMP No. 437 of 2022 HC-KAR
5. K.S.Munihanumaiah, to assist the respondent, who was in a financial crisis, requested the developer M/s.Sovereign Developers Infrastructures Limited to allot 39 apartments out of his additional share in favour of the respondent under the Memorandum of Understanding dated 14.11.2009 and a Board resolution was passed by the developers to give effect to the request made by K.S.Munihanumaiah and enable the respondent to receive the benefit out of the sale of 39 apartment units.
6. A full and final settlement agreement dated 04.12.2014 was entered into between K.S.Munihanumaiah and the respondent. The respondent agreed to restrict his liability to the extent of ₹4,00,00,000/- only and the petitioners were nominated by their father to receive all the benefits in case of his demise.
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NC: 2025:KHC:20629 CMP No. 437 of 2022 HC-KAR
7. Clause (4) of the Full and Final Settlement Agreement dated 04.12.2014 contained an arbitration clause as a dispute resolution mechanism and the dispute, if any, between the parties is required to be resolved by referring the same to the arbitration, and the sole arbitrator to be appointed in terms of the Act.
8. The father of the petitioners passed away on 11.02.2017. The respondent did not comply with the terms of the Full and Final Settlement Agreement dated 04.12.2014. Hence, a dispute has arisen between the petitioners and the respondent.
9. The petitioners invoked the arbitration clause by issuing a notice dated 12.03.2019 vide Annexure "E". The respondent replied to the arbitration notice by letter dated 20.04.2019 vide Annexure "F". The respondent did not agree to the proposal of the -6- NC: 2025:KHC:20629 CMP No. 437 of 2022 HC-KAR petitioners for appointing an arbitrator. Hence, this petition.
10. The notice of this petition was issued to the respondent. Despite the service of notice, the respondent remained unrepresented.
11. Heard the arguments of the learned counsel appearing for the petitioners.
12. The learned counsel for the petitioners submitted that there exists an agreement between the father of the petitioners and the respondent and the respondent did not perform his part of the contract. There is an arbitration clause under the full and final settlement agreement. The petitioners invoked the said arbitration clause by issuing a notice vide Annexure "E" and the respondent replied to it vide Annexure "F". As the arbitration clause existed in the said agreement and the dispute arose between the parties to the petition, the same is to be resolved through an -7- NC: 2025:KHC:20629 CMP No. 437 of 2022 HC-KAR arbitration. Accordingly, he prays to allow the petition.
13. Perused the records and considered the submissions advanced by the learned counsel appearing for the petitioners.
14. The point that arises for consideration in this petition is:
"Whether the petitioners have made out a ground to refer the dispute between the parties to the petition to the arbitrator in terms of Clause (4) of the Full and Final Settlement Agreement dated 04.12.2014 ?"
15. At the outset, there is no dispute in regard to the execution of the Full and Final Settlement Agreement dated 04.12.2014 and there is an arbitration clause in Full and Final Settlement Agreement, which reads as follows:-8-
NC: 2025:KHC:20629 CMP No. 437 of 2022 HC-KAR "(4) Arbitration: It is agreed to between the parties that in case of any disputes/differences between the parties either as to the interpretation of this agreement or as to the rights, duties, obligations, liabilities and entitlements of the parties to this understanding/ agreement and /or any person/s claiming under or through them, the same shall be resolved to between the parties amicably through mutual discussions and negotiations. In case, the disputes / differences cannot be resolved to between the parties and / or their nominees amicably, the same shall be resolved to between the parties by referring to the Arbitration of a sole arbitrator to be appointed by both the parties on mutual consent and concurrence. The law governing such arbitration shall be The Arbitration and Conciliation Act, 1996 and the venue of such Arbitration shall be at Bangalore. The parties do hereby agree that the language of the proceedings of Arbitration shall be English. However, this clause shall not disentitle the second party or his nominees to enforce their right under the provisions of Negotiable Instruments Act, in case dishonour of the aforesaid cheques."-9-
NC: 2025:KHC:20629 CMP No. 437 of 2022 HC-KAR
16. On perusal of Clause (4) of the Full and Final Settlement Agreement dated 04.12.2014, it is clear that if any dispute arises between the parties as to the interpretation of the agreement or as to the rights, the dispute has to be resolved through arbitration in terms of the Act.
17. Admittedly, there is an arbitration clause in the full and final agreement and a dispute arose between the petitioners and the respondent and the same is to be resolved through an arbitration.
18. In view of the above discussion, the petitioners had made a ground to refer the dispute to the sole arbitrator. Hence, the point under consideration is answered in the affirmative.
19. Consequently, I pass the following:
ORDER
(i) The petition is allowed.
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NC: 2025:KHC:20629 CMP No. 437 of 2022 HC-KAR
(ii) Hon'ble Mr. Justice retired Ajit Gunjal, Former Judge, High Court of Karnataka, is appointed as the sole Arbitrator to resolve the dispute between the parties to the petition, in terms of Clause (4) of the Full and Final Settlement Agreement dated 04.12.2014.
(iii) The office is directed to communicate this order to the learned Arbitrator, and the Arbitration and Conciliation Center, Bengaluru.
(iv) The Office is directed to return the original document(s) to the petitioners, after retaining a photocopy of the same.
(v) All pending interlocutory applications, if any, stand disposed of.
Sd/-
(ASHOK S.KINAGI) JUDGE RK Ct: KHV List No.: 1 Sl No.: 16