- 1 - HC-KAR NC: 2025:KHC:43855 CMP No. 497 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 31ST DAY OF OCTOBER, 2025 BEFORE THE HON'BLE MR. JUSTICE SURAJ GOVINDARAJ CIVIL MISC. PETITION NO. 497 OF 2024 BETWEEN: MR. SOUMEN CHAKRABORTY S/O. SRI. SUBHAS CHAKRABORTY, AGED ABOUT 41 YEARS, R/O. 125, PENINSULA PARK VILLE, OFF THINDLU ROAD, SARJAPURA 27 BANGALORE - 562 125, KARNATAKA. …PETITIONER (BY SRI. RAVI S.K, ADVOCATE) AND: 1. SMRTOWNER SERVICES INDIA PRIVATE LIMITED REP. BY ITS BOARD OF DIRECTORS, HAVING ITS REG. OFFICE AT 8TH FLOOR, DELTA BLOCK, SIGMA TECH PARK, OLD AIRPORT ROAD, WHITEFIELD BENGALURU - 560 066. 2. REGAL DWELLINGS PRIVATE LIMITED, REP BY ITS BOARD OF DIRECTORS, HAVING ITS REG. OFFICE AT LEVEL 3 AND 4, EMBASSY DIAMANTE, 34 VITTAL MALLYA ROAD, BENGALURU - 560 001. 3. BEACON TRUSTEESHIP LIMITED, REP. BY ITS BOARD OF DIRECTORS, Digitally signed by SHWETHA RAGHAVENDRA Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:43855 CMP No. 497 of 2024 HAVING ITS REG. OFFICE AT 7A AND B, SIDDHIVINAYAK CHAMBERS, OPP. MIG CRICKET CLUB, GANDHI NAGAR, BANDRA (EAST), MUMBAI - 400 051 …RESPONDENTS (BY SRI. TARAK SHAH, ADVOCATE FOR R3 VIDE ORDER DATED 24.10.2025; SRI. NAGARALE SANTHOSH SUBHASHCHANDRA, ADVOCATE FOR R1; R2 - REGAL DWELLINGS PVT. LTD., - SERVED) THIS CMP/ CIVIL MISCELLANEOUS PETITION UNDER SECTION 11(6) OF THE ARBITRATION AND CONCILIATION ACT, 1996, PRAYING TO 1. ALLOW THE PRESENT CIVIL MISCELLANEOUS PETITION AND APPOINT A SOLE ARBITRATOR UNDER THE ARBITRATION AND CONCILIATION ACT, 1996 IN TERMS OF ARTICLE 29.3 PORTFOLIO MANAGEMENT SERVICES AGREEMENT DATED 17.11.2019 AND 30.11.2019 AT ANNEXURE-A. 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: "WHEREFORE, the petitioner most humbly and respectfully prays that this Hon'ble Court may kindly be pleased to: - 3 - HC-KAR NC: 2025:KHC:43855 CMP No. 497 of 2024 1. Allow the present Civil Miscellaneous Petition and appoint a sole arbitrator under the Arbitration and Conciliation Act, 1996 in terms of Article 29.3 Portfolio Management Services Agreement dated 17.11.2019 and 30.11.2019 at Annexure-A; and 2. Grant such other relief, reliefs, or Orders as this Court deems fit on the facts and circumstances of the case in the interest of justice and equity." 2. The petitioner and respondent No.1 had entered into a Discretionary Portfolio Management Services Agreement under which the petitioner had invested certain amounts of money. 3. The said money is apparently invested by respondent No.1 in respondent No.2 of which respondent No.3 is a debenture trustee. The debenture has been issued by respondent No.2. 4. There being certain disputes between the petitioner and respondent No.1, the petitioner had issued a notice on 12.09.2024 calling upon the respondents raising his demand as also invoking the arbitration clause and nominating its arbitrator. - 4 - HC-KAR NC: 2025:KHC:43855 CMP No. 497 of 2024 5. The said notice, though served on the respondent, had no reply. Subsequently, the petitioner had approached this Court. 6. Notice having been issued, respondent Nos.1 and 3 have entered appearance. Respondent No.2 has chosen to be unrepresented. 7. The submission of learned counsel for the petitioner is that the investment made by the petitioner with respondent No.1 has been invested by respondent No.2 in respondent No.2 being a group company of respondent No.1 of which respondent No.3 is the debenture trustee, and as such, the entire actions taken by the respondents are in furtherance of the Portfolio Management Agreement entered into between the petitioner and respondent No.1, respondent No.2 being a group company of respondent No.1, and all three of the respondents would be bound by the arbitration clause in the agreement in the Portfolio Management Agreement, - 5 - HC-KAR NC: 2025:KHC:43855 CMP No. 497 of 2024 more particularly, at Clause 29.3, which is reproduced hereunder for easy reference: "29.3 Dispute Settlement Without prejudice to Clause 29.2 above, In the event of any disputes, differences, controversies and questions directly or indirectly arising at any time hereafter between the Parties or their respective representatives or permitted assigns under, out of, in connection with or in relation to this Agreement (or the subject matter of this Agreement) including, without limitation, all disputes, differences, contro-versies and questions relating to the validity, interpretation, construction, performance and enforcement of any provision of this Agreement, dispute, difference or contention arising between the Parties in relation to any of the provisions of this Agreement or the interpretation hereof, or as to rights, liabilities or duties of the Parties (hereinafter referred to as a "Dispute"), the same shall be, in the first instance, amicably settled between the Parties through consultations between senior representatives within a period of 30 (thirty) Business Days of such dispute arising. If after 30 (thirty) Business Days of consultation, between the representatives as aforesaid, the Parties have failed to reach an amicable settlement, on any or ali Disputes then at the request in writing of any Party to the Dispute the matter shall be referred to an arbitral tribunal comprising of a sole arbitrator, appointed with the consent of both the Parties, failing which, the arbitrator shall be appointed in accordance with the Arbitration and Conciliation Act, 1996, whose decision in relation to any such Dispute or difference shall state the reasons for the decision and shall be final and binding on the Parties hereto. The arbitration proceedings shall be conducted in the English - 6 - HC-KAR NC: 2025:KHC:43855 CMP No. 497 of 2024 language. The seat and venue of the arbitration shall be in Bangalore, India. 8. In this regard, he also relies upon the decision of the Hon'ble Apex Court in Chloro Controls Vs. Severn Trent Water Purification Inc. and Others reported in 2013 (1) SCC 641. 9. Sri.Shishira Amarnath, learned counsel appearing for respondent No.3 would however, submit that respondent No.3 is only a debenture trustee and has no privity of contract with the petitioner. 10. The privity of contract by respondent No.3 is only with respondent No.2 and as such, the petitioner cannot invoke the arbitration clause insofar as respondent No.3 is concerned. 11. Counsel for respondent No.1 however, submits that he has no objection to an arbitrator to be appointed. 12. Having heard the counsel for the petitioner and respondents No.1 and 3 and having perused the - 7 - HC-KAR NC: 2025:KHC:43855 CMP No. 497 of 2024 documents, it is clear that there is a Portfolio Management Agreement entered into between the petitioner and respondent No.1, in furtherance of which the investment was made by the petitioner in respondent No.1, which apparently has been invested in respondent No.2, of which respondent No.3 is the Debenture -Trustee. 13. In that view of the matter, firstly because respondent Nos.1 and 2 belong to the same group of companies and all associate companies and secondly, since the entire transaction arises out of the investment made by the petitioner in respondent No.1-Company. I am of the considered opinion that all the respondents would be bound by the aforesaid arbitration clause, and as such, I pass the following: ORDER i) CMP is allowed. - 8 - HC-KAR NC: 2025:KHC:43855 CMP No. 497 of 2024 ii) Sri.H.R.Srinivas, a Retired District Judge, is appointed as 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 and Conciliation Centre for doing the needful. (iv) Since the order is passed in the presence of both the counsel, they shall appear before the Director, Arbitration and Conciliation Centre, Bengaluru without requirement of any further notice at 02.30 p.m. on 12.11.2025. (v) All contentions are kept open. Sd/- (SURAJ GOVINDARAJ) JUDGE rv List No.: 1 Sl No.: 46 CT:BHK