- 1 - HC-KAR NC: 2025:KHC:40487 CMP No. 94 of 2024 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. 94 OF 2024 BETWEEN: SRI MUKESH KUMAR DEVGADE, S/O BUDHRAM DEVGADE, AGED ABOUT 37 YEARS, MANAGING PARTNER, M/S SHAKTI HOMES, A PARTNERSHIP FIRM, NO.1554, SRI CHOWDESHWARI ARCADE, EAST-END MAIN ROAD, 9TH BLOCK, JAYANAGAR, BANGALORE - 560069. …PETITIONER (BY SRI RADHANANDAN B S, ADVOCATE) AND: 1. MR. MANOJ K GUPTA, S/O LATE R.S. GUPTA, AGED ABOUT 61 YEARS, PARTNER, M/S SHAKTI HOMES, R/AT NO.302, EDEN PARK, NO.20, VITTAL MALLYA ROAD, BANGALORE - 560001. 2. MR. RAJKUMAR KHEJRIWAL, S/O LATE GOWRISHANKAR KEJRIWAL, AGED ABOUT 78 YEARS, R/AT KEJRIWAL BHAWAN, BADA BAZAR, DARABHANGA, BIHAR - 846004. …RESPONDENTS (BY SRI S K MITHUN, ADVOCATE) THIS CIVIL MISC. PETITION IS FILED UNDER SEC.11(5) OF THE ARBITRATION AND CONCILIATION ACT 1996, PRAYING THAT THIS HON'BLE COURT MAY BE PLEASED TO APPOINT A SOLE Digitally signed by SHWETHA RAGHAVENDRA Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:40487 CMP No. 94 of 2024 ARBITRATOR TO RESOLVE THE DISPUTE BETWEEN THE PARTIES HERETO AS PER CLAUSE 25 OF DEED OF RECONSTITUTION DATED 03/09/2018 AT ANNEXURE-B IN THE INTEREST OF JUSTICE AND EQUITY. THIS PETITION, COMING ON FOR FINAL HEARING, 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; "WHEREFORE, the Petitioner most respectfully prays that this Hon'ble Court may be pleased to appoint a Sole Arbitrator to resolve the dispute between the parties hereto as per clause 25 of Deed of Reconstitution dated 03/09/2018 at Annexure-B in the interest of justice and equity." 2. A Reconstitution Partnership Agreement was entered into between the Petitioner, respondent No.1 and certain others on 03.09.2018, which is governed by an arbitration clause in terms of Clause 25 thereof, which is reproduced hereunder for easy reference; 25. ARBITRATION: In the event of any dispute arising between the parties herein, either with regard to carrying on of the business of the firm or generally arising out of this Instrument of Partnership either with regard to interpretation or implementation of any of the terms or conditions agreed upon, such disputes - 3 - HC-KAR NC: 2025:KHC:40487 CMP No. 94 of 2024 shall be settled by the parties hereto by submitting them to arbitration to be carried out in accordance with the provisions of the Indian Arbitration Act, 1996 or any amendments thereon. 3. Alleging that respondent No.1 had without authority executed a sale deed of one of the firm's properties in favour of his father-in-law - respondent No.2 a legal notice which came to be issued to respondent No.1 on 17.04.2023, no reply having been received, the Petitioner issued one more notice on 28.07.2023 to respondents No.1 and 2 and nominated an arbitrator. The same, not having been replied to, the Petitioner approached this Court seeking for the aforesaid reliefs. 4. Notice having been issued, respondent has entered appearance. 5. The submission of Sri.Mithun., learned counsel for respondents, is that insofar as respondent No.1 is concerned, arbitration proceedings are maintainable. But in so far as respondent No.2 is concerned, respondent No.2 is not signatory to the arbitration - 4 - HC-KAR NC: 2025:KHC:40487 CMP No. 94 of 2024 agreement. He is a third party and as such, cannot be made party to arbitration proceedings. 6. Heard Sri.Radhanandan.B.S., learned counsel appearing for the petitioner and Sri.S.K.Mithun., learned counsel appearing for respondents and perused papers. 7. The short question that would arise for consideration is; “Whether respondent No.2, who is not a signatory to the arbitration agreement, can be made a party to the arbitration proceedings”. 8. The aspect of related party or associated party has been dealt with by the Hon’ble Apex Court in Chloro Controls P. Ltd vs. Seveb Trent Water Purification Inc and Ors., reported in (2013) 1 SCC 641 as also in Cox & Kings Ltd., vs. SAP India Pvt., Ltd., in Arbitration Petition No.38/2020 dated 09.09.2024. The Hon’ble Apex Court has clearly and categorically held that if any - 5 - HC-KAR NC: 2025:KHC:40487 CMP No. 94 of 2024 person were to receive any benefit and were to make any claim under a party to the arbitration agreement, the said party could also be made party to arbitration proceedings. 9. In that regard, learned counsel for respondents submits that respondent No.2 is not claiming under respondent No.1, but is claiming to be a purchaser from the partnership firm. This aspect would have to be looked into in the context of the matter, inasmuch as respondent No.1, being the partner, has executed a sale deed in favour of respondent No.2, who is his father-in-law, and in the present matter, both respondent No.1 and respondent No.2 have appeared through the very same counsel. It cannot be said that respondent No.2 is a third-party independent bona fide purchaser for value on the face of the matter as of today. 10. Since the relationship between respondent No.1 and respondent No.2 is admitted, the property of the - 6 - HC-KAR NC: 2025:KHC:40487 CMP No. 94 of 2024 partnership firm is alleged to have been dealt with without any authority, I am of the considered opinion that the arbitration clause could be equally applicable to respondent No.2 in terms of the decision of the Hon’ble Apex Court Chloro Controls P. Ltd case and Cox & Kings Ltd., In that view of the matter, I pass the following; ORDER i. The CMP is allowed. ii. Sri.Rajshekhar Venkanagouda Patil, a former District Judge of the District Judiciary of the State of Karnataka is appointed as a sole arbitrator to arbitrate the dispute between the parties under the aegis of the Arbitration Centre attached to this Court. iii. Registry is directed to forward a copy of this order to the Director, Arbitration Centre for doing the needful. - 7 - HC-KAR NC: 2025:KHC:40487 CMP No. 94 of 2024 iv. Both the counsels are directed to appear before the Director, Arbitration Center without requirement of any notice at 2.30 p.m. on 27.10.2025. SD/- (SURAJ GOVINDARAJ) JUDGE SR List No.: 1 Sl No.: 55