Isha Business Pvt LtdversusCulture Machine Media Pvt Ltd

                                                                            arbap324-2026-J.doc


                      Shabnoor
                             IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                 ORDINARY ORIGINAL CIVIL JURISDICTION

                                 ARBITRATION APPLICATION NO.324 OF 2026

                      Isha Business Pvt. Ltd.                     … Applicant
                                         V/s.
                      Culture Machine Media
                      Private. Limited & Ors.                     … Respondents

SHABNOOR
AYUB                  Mr. Shrihari Iyer, for the Applicant.
PATHAN
Digitally signed by
SHABNOOR
AYUB PATHAN
Date: 2026.09.17
11:36:35 +0530
                                          CORAM                : AMIT BORKAR, J.

                                          RESERVED ON          : SEPTEMBER 11, 2026.

                                          PRONOUNCED ON        : SEPTEMBER 17, 2026.

                      JUDGMENT:

                      1.    By the present Application, the Applicant has approached
                      this Court under Section 11 of the Arbitration and Conciliation Act,
                      1996, seeking appointment of a Sole Arbitrator. The Applicant
                      relies upon Clause 10 of the Content Management Agreement
                      dated 20 February 2017 entered into between the Applicant and
                      Aleph, read with Clause 3 of the Novation Agreement dated 4
                      January 2021 entered into between the Applicant, Aleph and
                      Respondent No. 1.

                      2.    Respondent No. 2 is not a signatory to the Novation
                      Agreement. However, according to the Applicant, Respondent No.
                      2 had a substantial role in carrying out the Agreement. The
                      Applicant submits that the Respondents are jointly and severally



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liable to pay the amounts received from YouTube in respect of
maintaining the Applicant's channels. According to the Applicant,
despite several communications and a notice, the Respondents
have failed to make the required payment.

3.   The facts which have led to filing of the present Application
are as follows. On 20 February 2017, a Content Management
Service Agreement was entered into between the Applicant and
Aleph. Under the said Agreement, Aleph was required to manage
the Applicant's YouTube channels and collect the revenue
generated from YouTube. After raising the invoice, Aleph was
required to remit the amount to the Applicant. The Agreement
provided that any dispute between the parties would be referred to
a Sole Arbitrator and that the venue of arbitration would be
Mumbai., on 4 January 2021, a Novation Agreement was entered
into between the Applicant, Respondent No. 1 and Aleph. Under
the said Agreement, Aleph was relieved from its duties under the
Principal Agreement and Respondent No. 1 was required to
perform those duties. The Novation Agreement provided that any
dispute between the parties would be referred to a Sole Arbitrator.

4.   According to the Applicant, after the Novation Agreement
came into effect, Respondent No. 1 did not remit the payments due
to the Applicant. The Applicant submits that Respondent No. 2 had
substantial control over Respondent No. 1 and had executed the
Agreement.    Despite   repeated       reminders,   the    Respondents
continued to delay payment of the outstanding amount. On 23
October 2023, discussions took place between the parties
regarding payment of the outstanding dues and the manner in



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which the dispute could be resolved. At that time, an amount of
approximately Rs. 2.56 Crores was due. After the discussions, the
Respondents made part payment. However, according to the
Applicant, they did not comply with the entire commitment made
by them.

5.   On 29 March 2024, the Applicant requested the Respondents
to delink all the YouTube channels belonging to the Applicant and
to transfer the rights to Shemaroo. Respondent No. 2 confirmed,
by an Agreement, the delinking of all the said channels. According
to the Applicant, an amount of Rs. 1,40,98,767/- continues to
remain payable by the Respondents. On 4 February 2026, the
Applicant issued a Notice calling upon the Respondents to pay the
outstanding   amount.    No   reply   was   received    from      the
Respondents., on 21 March 2026, the Applicant issued an
Arbitration Commencement Notice to the Respondents. Even to the
said notice, there was no response from the Respondents.

6.   The Applicant submits that the Arbitration Agreement was
entered into between the Applicant and Respondent No. 1.
According to the Applicant, although Respondent No. 2 is not a
signatory to the Agreement, it had a substantial role in giving
effect to the Agreement and was fully involved in the discussions
and negotiations with the Applicant. On this basis, the Applicant
submits that Respondent Nos. 1 and 2 are jointly and severally
liable to make payment of the outstanding amount. It is therefore
submitted that the arbitration proceedings are required to be
commenced against both Respondent Nos. 1 and 2. The Applicant
submits that Respondent No. 3, being a Director of both



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Respondent Nos. 1 and 2, is required to be made a party to the
arbitration proceedings.

7.   The Applicant submits that after the Novation Agreement
came into effect, Respondent No. 2, though a non-signatory to the
Agreements in question, played an important role in their
performance. According to the Applicant, the management of
Respondent No. 2 was actively involved in giving effect to the
Arbitration Agreement. The Applicant therefore relies upon the
conduct and participation of Respondent No. 2, which, according
to it, is shown from the correspondence and other material
referred to in the following paragraphs. In reply to an email sent
by the Applicant, the Assistant Vice President of Respondent No. 2
replied from his registered email ID on 18 July 2023. In the said
email, he admitted that there was a delay in making the payment.
He stated that the Respondents were not receiving the necessary
funding to make the payment due to the Applicant. The email
contained a proposed schedule for payment of the outstanding
dues and sought the Applicant's approval to that schedule.

8.   The Applicant submits that the above communication is
important because Respondent No. 2 took responsibility for the
delay in making the payment. The Applicant submits that the Vice
President of Respondent No. 2 was directly negotiating with the
Applicant regarding the outstanding amount and had proposed a
schedule for making the pending payments.

9.   Thereafter, the Applicant and Respondent Nos. 1 and 2 held
a joint discussion regarding the proposed payment plan.




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Respondent No. 3 and the Vice President of Respondent No. 2
participated in the discussion. According to the Applicant, they
agreed to the following payment schedule. The said schedule was
confirmed by Respondent No. 3 through an email dated 23
October 2023:

   Committed          Billing     Payment Status     Committed
  Payment Date        Month        Amount           Payment Date
30 October 2023 Apr-23          3,779,188 Actual 30 October
                                                 2023
30 October 2023 Aug-23          5,152,122 Actual 30 October
                                                 2023
13 November         Sep-23      ₹5,000,00 Appro 13 November
2023                                    0x      2023
17 November         May-23      2,276,125 Actual 17 November
2023                                             2023
15 December         Jul-23      4,355,435 Actual 15 December
2023                                             2023
15 December         Oct-23      ₹5,000,00 Appro 15 December
2023                                    0x      2023
Total                           25,562,86          Total
                                        9

10.     The Applicant submits that the initial reply received to its
email dated 27 June 2024 was vague and did not deal with the
outstanding payment., on 8 July 2024, Respondent No. 2 sent
another email stating that both Respondent Nos. 1 and 2 had
allegedly been acquired by M/s. Galaxy Racer. It was stated that,
as part of the sale transaction, Galaxy Racer had expressly agreed
to invest in Respondent Nos. 1 and 2 so that the pending payable
dues could be cleared. Respondent No. 2 assured the Applicant
that efforts would be made to ensure that the outstanding amount



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was paid.

11.   The Applicant has filed an affidavit of service showing
service of the present Application upon the Respondents. Despite
service, none has appeared on behalf of the Respondents.

REASONS AND FINDINGS:

12.   I have considered the Arbitration Application, the documents
which are on record and the submissions made by the Applicant.
The Respondents were served with the Application. Even after
service, they have not appeared before the Court and have not
placed any material opposing the Application. The affidavit of
service is on record.

13.   The Applicant's case is that, on 20 February 2017, a Content
Management Service Agreement was entered into between the
Applicant and Aleph. Under this Agreement, Aleph was required to
manage the Applicant's YouTube channels. Aleph was required to
collect the revenue generated from YouTube and remit the amount
to the Applicant after raising the invoice. The Applicant relies upon
the arbitration provision contained in the said Agreement.
According to the Applicant, disputes between the parties were
required to be referred to a Sole Arbitrator and the venue of
arbitration was Mumbai.

14.   Thereafter, on 4 January 2021, the Applicant, Aleph and
Respondent No. 1 entered into a Novation Agreement. According
to the Applicant, after this Agreement was entered into, Aleph was
relieved of its obligations under the Principal Agreement and
Respondent No. 1 took over the said obligations. Thus, the



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arrangement which was earlier between the Applicant and Aleph
was continued with Respondent No. 1. For invoking the arbitration
provision, the Applicant relies upon Clause 3 of the Novation
Agreement read with Clause 10 of the original Agreement.

15.   At this stage, the first question which arises is regarding the
existence of the arbitration arrangement between the Applicant
and Respondent No. 1. The Applicant has relied upon both the
Agreements and has stated that the Novation Agreement was
entered into between the Applicant, Respondent No. 1 and Aleph.
Respondent No. 1 has not appeared before this Court. There is no
material placed by Respondent No. 1 disputing the execution of
the Novation Agreement or the arbitration clause relied upon by
the Applicant. The Applicant has stated that after the Novation
Agreement came into force, Respondent No. 1 did not make the
payments which were due to the Applicant. According to the
Applicant, an amount of Rs. 1,40,98,767/- is still outstanding.
Whether the entire amount claimed by the Applicant is payable or
not is a matter which can be decided in the arbitration
proceedings.

16.   There is material showing that the dispute regarding
payment was existing between the parties. The Applicant states
that several communications were exchanged regarding the
outstanding payment. On 23 October 2023, discussions were held
between the parties regarding payment of the outstanding dues.
According to the Applicant, at that time approximately Rs. 2.56
Crores was payable., the Respondents made part payment.
However, according to the Applicant, the entire commitment made



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by the Respondents was not complied with. The payment schedule
relied upon by the Applicant is relevant. According to the
Applicant, Respondent No. 3 and the Vice President of Respondent
No. 2 participated in the discussions regarding the payment plan.
The payment schedule was confirmed by Respondent No. 3
through an email dated 23 October 2023. The total amount shown
in the said payment schedule was Rs. 25,562,869. The material
relied upon by the Applicant shows that Respondent No. 2 was
involved in the dealings concerning the outstanding payment. In
paragraph 8, the Applicant relies upon an email dated 18 July
2023 sent by the Assistant Vice President of Respondent No. 2
from his registered email ID. According to the Applicant, in that
email the delay in payment was admitted. It was stated that the
Respondents were not receiving the necessary funds for making
payment to the Applicant. A payment schedule was proposed in
the said email and the Applicant's approval for the same was
sought. The contents of this communication are relevant because
they show that the issue regarding payment was being discussed at
the level of Respondent No. 2. The Applicant has relied upon
specific correspondence and upon the conduct of persons
representing Respondent No. 2. At the same time, only because
Respondent No. 2 participated in the correspondence and
discussions, it cannot be finally held at this stage that Respondent
No. 2 is bound by the Arbitration Agreement. A person may
participate in carrying out a contract or may discuss payment
arising from the contract. Whether such participation is sufficient
to make that person a party to the Arbitration Agreement is a




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separate question. For deciding that question, the Agreements, the
correspondence, the conduct of the parties and the other
surrounding circumstances may have to be considered.

17.   The same position applies to Respondent No. 3. The
Applicant has stated that Respondent No. 3 is a Director of
Respondent Nos. 1 and 2 and that he participated in the
discussions regarding the payment schedule. The Applicant relies
upon the fact that the payment schedule was confirmed by
Respondent No. 3 through the email dated 23 October 2023. These
facts are relevant and cannot be ignored. However, at this stage,
they cannot be treated as a final finding that Respondent No. 3
became a party to the Arbitration Agreement.

18.   The Applicant has relied upon the subsequent conduct of
Respondent No. 2. In paragraph 11, the Applicant states that on 8
July 2024 Respondent No. 2 informed the Applicant that
Respondent Nos. 1 and 2 had allegedly been acquired by M/s.
Galaxy Racer. It was stated that, as part of the sale transaction,
Galaxy Racer would invest in Respondent Nos. 1 and 2 so that the
pending payable dues could be cleared. The Applicant was assured
that efforts would be made to clear the outstanding amount. This
correspondence is relevant because it shows that even after the
original arrangement, the issue of the unpaid amount claimed by
the Applicant continued to be dealt with by persons connected
with Respondent No. 2. It shows that the Respondents were aware
of the claim made by the Applicant. However, this later
correspondence by does not change the original rights of the
parties. If necessary, the effect of this correspondence can be



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considered in the arbitration proceedings. Thereafter, the Applicant
issued a Notice dated 4 February 2026 to the Respondents calling
upon them to pay the outstanding amount. No reply was received.
The Applicant issued an Arbitration Commencement Notice dated
21 March 2026. Even to this notice, according to the material on
record, no response was given by the Respondents.

19.   These facts are required to be considered together. The
Applicant has shown that there was a relationship between the
parties. There was an arbitration provision. A dispute regarding
payment had arisen. Several attempts were made to obtain
payment. Part payment was made, and a specific amount was
claimed as outstanding. A Notice was issued and an Arbitration
Commencement Notice was issued. Therefore, the dispute between
the parties is an existing dispute. It cannot be said that the
Applicant has approached the Court for arbitration in respect of
some dispute which is imaginary or which has not yet arisen.

20.   The next question is whether, on the basis of these facts, a
Sole Arbitrator is required to be appointed. The Applicant has
invoked Section 11 of the Arbitration and Conciliation Act, 1996.
The arbitration provision relied upon by the Applicant provides for
reference of the disputes to a Sole Arbitrator. The Applicant has
approached this Court because, despite the demand for resolving
the dispute, the Respondents did not take steps for constitution of
the arbitral tribunal. On the material before the Court, there is
sufficient basis to hold that an arbitration agreement exists
between the Applicant and Respondent No. 1. There is sufficient
material to show that disputes have arisen regarding performance



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of the arrangement. The failure to make payment is the dispute
which requires adjudication. Therefore, the Applicant has made
out a case for constitution of the arbitral tribunal.

21.   The position regarding Respondent No. 2 requires separate
consideration. The Applicant accepts that Respondent No. 2 is a
non-signatory. Paragraph 6 states that “Respondent No. 2, being a
non-signatory to the Agreement, has played a substantial role in
giving effect to the Agreement”. Paragraph 7 states that
Respondent No. 2 is “a non-signatory to the impugned
Agreements”. I have considered the material relied upon by the
Applicant in support of this submission. The correspondence dated
18 July 2023, the discussions regarding the payment plan, the
participation of the Vice President of Respondent No. 2, the later
correspondence and the confirmation regarding delinking of the
YouTube channels do show that Respondent No. 2 was involved in
the dealings with the Applicant. Therefore, the Applicant's
submission regarding involvement of Respondent No. 2 is
supported by the material placed on record. At the same time, the
question whether this involvement is sufficient to bind Respondent
No. 2 to the Arbitration Agreement should not be finally decided in
the present proceedings. On the material available, it would not be
proper to give a final finding on this issue. Merely because
Respondent No. 2 participated in performance of the Agreement or
in correspondence regarding payment, it cannot be held that
Respondent No. 2 became a party to the Arbitration Agreement.
Whether Respondent No. 2 can be treated as bound by the
Arbitration Agreement as a non-signatory is therefore kept open.



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22.   The same approach is required in respect of Respondent No.
3. The Applicant relies upon his position as Director of Respondent
Nos. 1 and 2, his participation in the discussions and his
confirmation of the payment schedule. These facts may have
relevance in the arbitration proceedings. They may be relied upon
by the Applicant in support of its case regarding the liability of
Respondent No. 3. However, these facts alone do not require this
Court to give a final finding in the present proceedings that
Respondent No. 3 is bound by the Arbitration Agreement. It is
relevant that Respondent Nos. 2 and 3 have not appeared before
the Court even after service. Therefore, they have not placed their
own version regarding the correspondence, the Agreements, the
discussions concerning payment or the subsequent transactions.
Their absence cannot be treated as an admission of every
allegation made by the Applicant. At the same time, there is no
material from their side which would displace the prima facie
existence of the dispute or the arbitration arrangement relied upon
by the Applicant.

23.   In these circumstances, I am satisfied that the Applicant has
made out a case for appointment of a Sole Arbitrator. The
Application cannot be rejected only because the Applicant has
sought to proceed against persons who are not signatories to the
Arbitration Agreement. The question whether such persons can be
treated as parties to the Arbitration Agreement or can otherwise be
bound by it can be considered in accordance with law.
24.   In the aforesaid circumstances, the present Application under
Section 11 of the Act, is deserved to be disposed of in terms of the



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following order:

     A)    Mr Jash Gandhi, is hereby appointed as the Sole
     Arbitrator to adjudicate the disputes and differences arising
     between the Applicant and Respondent No. 1 under the
     Content Management Service Agreement dated 20 February
     2017 read with the Novation Agreement dated 4 January
     2021;

     Office Address:- 3rd Office, Brady House Building, 2nd Floor,
     Kala Ghoda, Mumbai – 400 001

     Email: [email protected]

     B)    A copy of this Order will be communicated to the
     Learned Sole Arbitrator by the Advocates for the Applicant
     within a period of one week from today. The Applicant shall
     provide the contact and communication particulars of the
     parties to the Arbitral Tribunal along with a copy of this
     Order;

     C)    The Learned Sole Arbitrator is requested to forward the
     statutory Statement of Disclosure under Section 11(8) read
     with Section 12(1) of the Act to the Advocates for the
     Applicant so as to enable them to file the same in the
     Registry of this Court. The Registry of this Court shall retain
     the said Statement on the file of this Applicant and a copy of
     the same shall be furnished by the Advocates for the
     Applicant to the Advocates for the Respondent;

     D)    The Learned Sole Arbitrator is requested to forward the



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      statutory Statement of Disclosure under Section 11(8) read
      with Section 12(1) of the Act to the parties within a period
      of two weeks from receipt of a copy of this Order;

      E)    The parties shall appear before the Learned Sole
      Arbitrator on such date and at such place as indicated, to
      obtain appropriate directions with regard to conduct of the
      arbitration including fixing a schedule for pleadings,
      examination of witnesses, if any, schedule of hearings etc. At
      such meeting, the parties shall provide a valid and functional
      email address along with mobile and landline numbers of the
      respective Advocates of the parties to the Arbitral Tribunal.
      Communications to such email addresses shall constitute
      valid service of correspondence in connection with the
      arbitration;

      F)    All arbitral costs and fees of the Arbitral Tribunal shall
      be borne by the parties equally in the first instance, and shall
      be subject to any final Award that may be passed by the
      Tribunal in relation to costs.

25.   All issues on merits are expressly kept open to be agitated
before the arbitral tribunal appointed hereby.

26.   All actions required to be taken pursuant to this order shall
be taken upon receipt of a downloaded copy as available on this
Court’s website.


                                             (AMIT BORKAR, J.)




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