- 1 - HC-KAR NC: 2025:KHC:40488 CMP No. 269 of 2023 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 10TH DAY OF OCTOBER, 2025 BEFORE THE HON'BLE MR. JUSTICE SURAJ GOVINDARAJ CIVIL MISC. PETITION NO. 269 OF 2023 BETWEEN: M/S MYSORE ESDM CLUSTER, (A COMPANY REGD. UNDER SECTION 8 OF COMPANEIS ACT, 2013) HAVING OFFICE AT: PLOT NO 336/4 & 336/5, HEBBAL INDUSTRIAL AREA, MYSURU-570 018, REP. BY ITS AUTHORISED SIGNATORY. …PETITIONER (BY SRI MAHESHCHANDRA B N, ADVOCATE) AND: SRI SANJEEV KUMAR GUPTA, AGED MAJOR, KARNATAKA DIGITAL ECONOMY, MISSION (KDEM), KEONICS, 27TH MAIN ROAD, 1ST SECTOR, HSR LAYOUT, BENGALURU-560 102. ALSO AVAILABLE: B-63, ROSEWOOD CITY, SECTOR 49, GURGAON, HARYANA-122 018. …RESPONDENT (BY SMT. ISHITA SHARMA, ADVOCATE) THIS CIVIL MISC. PETITION IS FILED UNDER SEC.11(6) OF THE ARBITRATION AND CONCILIATION ACT 1996, PRAYING THIS HON'BLE COURT BE PLEASED TO A) APPOINT AN ARBITRATOR TO ADJUDICATE THE DISPUTE BETWEEN THE PARTIES UNDER SECTION 11 OF ARBITRATION AND CONCILIATION ACT, 1996 VIDE Digitally signed by SHWETHA RAGHAVENDRA Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:40488 CMP No. 269 of 2023 ANNEXURE-B DATED 08.01.2018 BEARING NO. MESDMCOLNO 01.01.2018. B) GRANT SUCH OTHER RELIEFS AS THIS HON'BLE COURT MAY DEEM FIT TO GRANT, IN THE CIRCUMSTANCES OF THE CASE, INCLUDING AN ORDER AS TO COSTS, 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 SURAJ GOVINDARAJ ORAL ORDER 1. The petitioner is before this Court seeking for the following reliefs; a. Appoint an Arbitrator to adjudicate the dispute between the parties under section 11 of Arbitration and Conciliation Act, 1996 vide Annexure-B dated 08.01.2018 bearing No. MESDMCOLNO 01.01.2018. b. Grant such other reliefs as this Hon'ble Court may deem fit to grant, in the circumstances of the case, including an order as to costs, in the interest of justice and equity. 2. The employment agreement was entered between petitioner and respondent on 08.01.2018 which is covered by an arbitration clause in terms of Clause 13 thereof, which is extracted herein for easy reference; 13. Disputes & Arbitration: Any dispute or difference or claim arising in connection with this contract shall be resolved by - 3 - HC-KAR NC: 2025:KHC:40488 CMP No. 269 of 2023 reference to arbitration by a sole arbitrator appointed by Cluster, at its sole discretion. The arbitration proceedings shall be governed by the Arbitration & Conciliation Act, 1996. The language of arbitration shall be English. Each of Cluster or the employee shall be respectively entitled to approach the Court of competent jurisdiction for such interim relief's as the Cluster or the Employee may in its discretion deem fit. The venue of arbitration shall be at Mysore and the Courts at Mysore shall have exclusive jurisdiction. The award of the arbitrator shall be final and binding on the parties. The governing law shall be the laws of India. 3. Alleging that during the course of employment, the respondent has self-certified and withdrawn several amounts the petitioner called upon the respondent to refund the amount of Rs.1,83,33,341/- and in pursuance thereto, invoked the arbitration clause and nominated the nominee arbitrator. 4. In reply thereto, firstly the respondent sought for time and thereafter on 24.05.2023, did not consent to the unilateral appointment of the arbitrator and contended that there was no dispute which exists between the petitioner and the respondent. It is in that background that the petitioner is before this Court seeking the aforesaid reliefs. - 4 - HC-KAR NC: 2025:KHC:40488 CMP No. 269 of 2023 5. Notice having been issued, the respondent has filed his written statement contending that the agreement being an employment agreement i.e., an agreement for a service is not amenable for arbitration and in that regard reliance has been placed on the decision of the Hon’ble Apex Court Booz Allen & Hamilton Inc. v. SBI Home Finance Ltd1 and on that basis it is contended that a lis in rem cannot be arbitrated. 6. Reliance is also placed on H.R. Bajaj vs. State of Maharashtra2 to contend that employment contract is not arbitrable. Similarly, reliance is being placed on the decision of the Hon’ble Apex Court in Vidya Drolia vs. Durga Trading Corporation3 to contend that in present matter the subject matter can not be arbitrated upon. 7. By relying on N.Radhakrishnan vs. Maestro Engineers4 it is contended that there being 1 (2011) 5 SCC 532 2 SC (1994) 3 SCC 388 3 (2021) 2 SCC 1 4 (2010) 1 SCC 72 - 5 - HC-KAR NC: 2025:KHC:40488 CMP No. 269 of 2023 allegations of fraud made by the petitioner in the legal notice, the same cannot be arbitrated and as such it is contended that the above petition is required to be dismissed. 8. Heard Sri.Mahesh Chandra.B.N., learned counsel appearing for the petitioner and Smt.Ishita Sharma., learned counsel appearing for respondent and perused papers. 9. The execution of the employment agreement is not in dispute. The existence of the arbitration clause in the said agreement is not in dispute. 10. What is sought to be contended is that a service contract cannot be arbitrated, and there are allegations made that there is fraud played by a respondent, an arbitration proceeding cannot be initiated. 11. These aspects would have to be looked into in the context of the dispute between the parties. In so far as the service contract is concerned, a service - 6 - HC-KAR NC: 2025:KHC:40488 CMP No. 269 of 2023 contract would not be arbitrable if the service contract is sought to be enforced for purpose of implementation of the service conditions or the like. In as much a contract of personal service is not capable of being specifically enforced. 12. This is not a case seeking specific enforcement of a service condition; as such, the decisions relied on in that regard would not be applicable. 13. In so far as the decision in N.Radhakrishnan vs. Maestro Engineers’ case is concerned, the allegation which has been made in the legal notice is that the respondent has fraudulently withdrawn the money by self-certifying the amounts. The same thought could result in a criminal action, for the purpose of recovery of the money, a civil action would be maintainable. As such in that view of the matter the decision in N.Radhakrishnan vs. Maestro Engineers’ case would also not be applicable. - 7 - HC-KAR NC: 2025:KHC:40488 CMP No. 269 of 2023 14. In so far as the decisions in Booz Allen & Hamilton Inc.’s and Vidya Drolia’s case are concerned the proceedings for arbitration which have been initiated in the matter dealing with the recovery of money, I am of the considered opinion that the same ia an arbitrable claim and as such those decisions would not be applicable. Hence, the contention of the respondent stands rejected. 15. Learned counsel for respondent at this stage submitted that the matter could be referred to mediation. Learned counsel for the petitioner submitted that he is agreeable to the same. 16. In that view of the matter, I pass the following; ORDER i. The CMP is allowed. ii. The Registrar (Judicial) is directed to place the file before the Director, Karnataka Mediation Centre, for the appointment of a suitable person to mediate the dispute between the parties. - 8 - HC-KAR NC: 2025:KHC:40488 CMP No. 269 of 2023 iii. Since the order is passed in the presence of both the counsels, they shall appear before the Director, Karnataka Mediation Centre, without the requirement of any further notice at 2.30 pm on 27.10.2025. iv. In the event of the mediation not being successful, the Director, Karnataka Mediation Centre, is directed to forward the file to the Director, Karnataka Arbitration and Conciliation Centre for the purpose of conducting the arbitration proceedings within 15 days of failure of mediation. v. Justice Sri.B.A.Patil., Former Judge of this Court is appointed as a sole arbitrator to arbitrate the dispute, in the event that the mediation proceedings fail. Sd/- (SURAJ GOVINDARAJ) JUDGE SR List No.: 1 Sl No.: 33