CMP/679/2025 of VERDE DEVELOPERS PVT LTD Vs SANKASH PRIVATE LIMITED on 5 October 2026

ORAL ORDER

1. This petition is filed under Section 11(6) of the Arbitration and Conciliation Act, 1996 (for short, “the Act”), seeking appointment of a sole Arbitrator for adjudication of the disputes that have arisen between the parties under the Memorandum of Understanding (hereinafter referred to as ‘MOU’ for short) dated 18.09.2024, particularly in terms of Clause 10 thereof, produced at Annexure-E.

2. The brief facts of the case are that the Board of the respondent No.1-Company, by Resolution dated 27.08.2024, approved the need for financial assistance and authorised respondent Nos.2 and 4, its Directors, to liaise with the petitioner. Pursuant thereto, on 28.08.2024, the respondent Nos.1, 2 and 4 addressed a letter to the petitioner seeking financial assistance, and the petitioner, by letter dated 02.09.2024, agreed to advance a sum of Rs.1,50,00,000/- as an incorporate loan. On 06.09.2024, the respondent No.2 acknowledged receipt of the said loan

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amount from the petitioner on behalf of respondent- Company. Thereafter, on 18.09.2024, the petitioner and the respondent entered into a MOU, duly signed by both parties, under which the respondent agreed to repay the loan amount along with interest at 9% per annum on or before 25.03.2025, failing which the respondent would be in default. On 25.03.2025, the respondent requested an extension of 90 days for repayment of the loan amount along with interest. As the amount was not repaid despite extension, the petitioner, by email dated 06.08.2025, called upon the respondent to repay the loan amount of Rs.1,50,00,000/- along with interest. Subsequently, disputes arose between the parties in relation to the said MOU.

3. As the disputes arose between the parties, the petitioner, invoking the arbitration clause contained in the MOU, issued a notice dated 24.09.2025, vide Annexure-G, to the respondent under Section 21 of the Act. The same

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was served upon the respondent. The said arbitration clause 10 reads as under: “10. This MoU and all questions concerning the construction, validity and interpretation of this MoU will be governed by the laws of India. The Parties to this MoU agree to use all reasonable efforts to resolve any dispute, controversy, claim or disagreement of any kind whatsoever between or among the Parties in connection with or arising out of this MoU. If any Dispute is not resolved within 7 days of either Party issuing a notice to the other in terms of this Clause, the Parties agree to submit such Dispute to be resolved through arbitration. All disputes arising out of or in connection with this MoU shall be referred to and finally settled by arbitration before a sole arbitrator under the Arbitration and Conciliation Act, and any subsequent amendments made thereafter. The place of such arbitration shall be Bengaluru. The language of the arbitration shall be English. Subject to the foregoing, the courts in Bengaluru, India shall have exclusive jurisdiction and the Parties hereto waive any objection to such proceedings on grounds of venue or on the grounds that the proceedings have been brought in an inconvenient forum. Each party to the Dispute shall bear its own arbitration expenses.”

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4. The respondent sent a reply to the said notice. Being dissatisfied with the reply, the present petition is filed seeking appointment of a sole Arbitrator.

5. The learned counsel for the respondent submits that respondent has no objection to the appointment of sole Arbitrator and prays that all the contentions of the parties may be left open.

6. Having regard to the existence of the arbitration clause contained in the MOU, which provides for resolution of disputes arising between the parties, and the fact that the petitioner has duly invoked the said arbitration clause by issuing notice under Section 21 of the Act, this Court is of the opinion that a Sole Arbitrator is required to be appointed for adjudication of the disputes between the parties.

7. Accordingly, the following:

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ORDER

a) Civil Miscellaneous Petition is allowed.

b) Hon’ble Smt.Justice K.S.Mudagal, Former Judge of High Court of Karnataka, is appointed as the Sole Arbitrator in the present case to arbitrate the disputes between the parties at the Arbitration and Conciliation Centre (Domestic & International), Bengaluru, as per the Rules governing the said Arbitration Centre.

c) All the claims and contentions of the parties are left open.

d) Registry is directed to communicate this order via e-mail to the Arbitration and Conciliation Centre (Domestic & International), Khanija Bhavan, Bengaluru, and also to Hon’ble Smt.Justice K.S.Mudagal, Former Judge of High Court of Karnataka.

e) Registry is directed to return all the original documents produced by any of the parties after obtaining Photostat copies of the same.

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f) Parties are directed to appear before the Director, Arbitration and Conciliation Centre, Bengaluru, on 03.11.2026 at 11:30 a.m.

(H.T. NARENDRA PRASAD) JUDGE

HA LIST NO.: 1 SL NO.: 13