Five Star Business Finance Limited v. G.Shyam Sundar
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 23.04.2025
CORAM
THE HON'BLE Mr. JUSTICE ABDUL QUDDHOSE Five Star Business Finance Limited, rep. by its Legal Officer Madhu Sandhan Someswaran ... Petitioner
Versus
1.G.Shyam Sunder 2.Gopi Manasa 3.G.Mary Shalini 4.G.Mojes Samuel ... Respondents Prayer: Arbitration Original Petition (Commercial Division) filed under Section 11(5) of the Arbitration and Conciliation Act, 1996 to appoint an Arbitrator to decide the disputes and differences between the petitioner and respondent in terms of Loan Agreement dated 21.12.2022. For Petitioner : Ms.Vinodhini Mathelene for Mr.P.H.Vinodh Pandian For Respondents : Set exparte
ORDER
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As directed by this Court, the registry has printed the name of the respondents in the cause list today. All the respondents have now been duly served with the notice in this petition. Till date, the respondents remain un-represented. Hence, the respondents are set exparte by this Court. 2.This petition has been filed under Section 11 of the Arbitration and Conciliation Act, seeking for the appointment of an Arbitrator by this Court. 3.There seems to be a dispute between the petitioner and the respondents arising out of the Loan Agreement dated 21.12.2022. The respondents have also deposited title deeds and have created mortgage through the Memorandum of Deposit of title deeds dated 21.12.2022. There exists an arbitration clause in the aforementioned loan agreement and the same is extracted hereunder:
'ARTICLE 10 ARBITRATION All disputes, differences, and/or claims arising out of this Agreement, whether during its subsistence or thereafter shall be settled by 'Arbitration' in accordance with the provisions of the 'Arbitration and Conciliation Act 1996' (Act 26 of 1996) or 2/6
any other statutory amendments thereof and shall be referred to the Sole Arbitration of an 'Arbitrator', whose appointment shall be made mutually by the parties. It is a term of this agreement that in the event of such an Arbitrator to whom the matter has been referred to originally dies or being unable or unwilling to act for any reason, then in such event, the parties shall appoint a substitute sole arbitrator mutually. Such person, when appointed as Arbitrator, shall be entitled to proceed with the reference, from the stage at which it was left by his predecessor. The venue of the Arbitration proceedings shall be in Chennai.'
4.The petitioner has invoked arbitration in accordance with the arbitration clause by issuing notice to the respondents on 04.12.2024 to comply with the requirements of Section 21 of the Arbitration and Conciliation Act, 1996. No reply has been received by the petitioner for the same.
5.Since there exists an arbitration clause in the loan agreement, which is the subject matter of the dispute between the parties and since the 3/6
petitioner has complied with the requirements of Section 21 of the Arbitration and Conciliation Act, 1996 by issuing notice to the respondents on 04.12.2024 and since there is no consensus between the parties with regard to the name of the Arbitrator, this Court will have to necessarily appoint an Arbitrator as prayed for in this petition. 6.For the foregoing reasons, this Arbitration Original Petition is allowed by issuing the following directions:
(a)This Court appoints Ms.K.Indhumathi, Advocate, having address at Flat No.68, Door No.S1, Sai Sivam Homes, 2nd Main Road, Ganesh Avenue, Sakthi Nagar, Porur, Chennai-600 116, Mobile No.63798 32429 as the Sole Arbitrator to adjudicate the dispute between the petitioner and the respondents, arising out of the Loan Agreement dated 21.12.2022, on merits and in accordance with law;
(b)The Arbitrator shall be paid her remuneration/fees in accordance with the 4th Schedule of the Arbitration and Conciliation Act, 1996; (c)Both the parties shall equally share the Arbitrator's fees; (d)The Arbitrator shall conduct the arbitration in accordance with the 4/6
provisions of the Arbitration and Conciliation Act, 1996 and shall complete the arbitration within the specified time as prescribed under the said Act. No costs.
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ABDUL QUDDHOSE, J.
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