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Bombay High Court

MR. PADAMSHI KALYANJI GAJRAversusM/S NIDHI ROYAL DEVELOPERS LLP

Decided
Disposal
Disposed Off

Holding

The Court appointed a sole arbitrator, Drupad Patil, to adjudicate the dispute under the LLP agreement's arbitration clause.

Summary

Satish Ramchandra Sangar, a partner of Nidhi Royal Developers LLP, filed an arbitration petition invoking the arbitration clause in the LLP Agreement dated 28 January 2013. The clause provides for a three‑member tribunal with two arbitrators appointed by designated partners, but the petitioner unilaterally nominated an arbitrator which Respondent No.4 rejected, and Respondents No.2 and No.3 did not appear. The High Court examined the validity of the arbitration clause and the parties' objections, finding no dispute over its existence and deeming the petition appropriate for arbitration. The Court therefore appointed Mr. Drupad Patil as the sole arbitrator, fixed Mumbai as the seat, and issued procedural directions under the Arbitration and Conciliation Act, 1996. The arbitration petition was subsequently disposed of.

Issues considered

  • Whether the arbitration clause in the LLP Agreement can be invoked despite the petitioner's unilateral nomination of an arbitrator
  • Whether the court can appoint a sole arbitrator when the agreement provides for a three‑member tribunal
  • Whether objections raised by Respondent No.4 fall within the scope of Section 11 of the Arbitration and Conciliation Act, 1996

Legislation cited

Subjects

  • Arbitration
  • LLP Agreement
  • Arbitration Clause
  • Appointment of Arbitrator
  • Section 11 Arbitration Act
  • Civil Procedure
  • High Court of Bombay

Judgment

                                                                               ARP-88-2026.doc


                            IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                    CIVIL APPELLATE JURISDICTION

                                      ARBITRATION PETITION NO.88 OF 2026
SATISH
RAMCHANDRA
SANGAR
                             Mr.Padamshi Kalyanji Gajra,                   ]
Digitally signed by
SATISH RAMCHANDRA            Age : Adult, Occupation : Business,           ]
SANGAR
Date: 2026.09.21             Residing at : 1102, Tripoli Building,         ]
18:37:43 +0530
                             Skyline Oasis, Premier Road, Near Kia         ]
                             Motors,Vidyavihar (West),Mumbai–400086.       ]   ...Petitioner
                                          Versus
                      1.     M/s. Nidhi Royal Developers LLP,              ]
                             Limited Liability Partnership Firm,           ]
                             7, Ground Floor, New Sonal Link               ]
                             Industrial Estate, Cooperative Society Ltd.   ]
                             Link Road, Bldg. No.1, Opp. Movie Time        ]
                             Threatre, Malad (West), Mumbai–400064.        ]
                      2.     Lalit Nagindas Doshi,                      ]
                             Age : Adult, Occupation : Business,        ]
                             91, Rustomjee Residency, Adarsh Dugdhalya, ]
                             Marve Road, Malad (West), Mumbai–400064. ]
                      3.     Shashikant Bhaskar Mhatre,
                             Age : Adult, Occupation : Business,           ]
                             Shop No.19, Sai Tower, Diwanman,              ]
                             Ambadi Road, Vasai (West),                    ]
                             Mumbai – 401 202.                             ]
                      4.  Haresh Ramji Bhanushali,                     ]
                          Age : Adult, Occupation : Business,          ]
                          803/B, Pride Residency, Luxuria Parade Park, ]
                          Near R Mall, Ghodbunder Road,                ]
                          Thane – 400 615.                             ] ...Respondents
                      ====================================================
                      Mr.Rishikesh Soni i/b. Ms.Meena Advocate for Petitioner.
                      R. Sharma:-
                      Mr.Vignesh     Ashokan          i/b. Advocate for Respondent No.4.
                      Mr.Abhijeet Kandarkar:-

                      Satish Sangar                                                            1/5
                                                          ARP-88-2026.doc




====================================================
                          CORAM      :    S. M. MODAK, J.
                          DATE       :    18th SEPTEMBER 2026
P. C. :-

1.     This matter is not on board. Taken on board as per the oral

request and consented by other side as other two matters are on board.

2.     Heard learned Advocate for the Petitioner and learned Advocate

for Respondent No.4.

3.     Mr.Kasle, learned Advocate is not available. An adjournment is

sought. However, considering the issue and pleadings, I am not in

favour of granting adjournment. The Respondent Nos.2 and 3 are duly

served by way of private notice. The Respondent No.1 is the

Partnership Firm consisting of the Petitioner and the Respondent

Nos.2 to 4 as the Partners.

4.     Already there is a Limited Liability Partnership Agreement (“LLP

Agreement”) dated 28th January 2013 in between the parties to this

Petition. There is Arbitration Clause No.24 (Page No.47). It suggests

an appointment of Arbitrators. It reads thus:-

     “24.       DISPUTE RESOLUTION
                All disputes, differences, claims and questions
                whatsoever, which shall arise either during the
                continuance of the limited liability partnership or

Satish Sangar                                                          2/5
                                                                 ARP-88-2026.doc


                thereafter between the Partners or their representative(s)
                or between the Partner or Partners and the legal
                representative(s) of the other Partners touching these
                Presents, shall be referred to the arbitration of an Arbitral
                Tribunal consisting of three arbitrators, of which the two
                Designated Partners shall appoint 1 (one) arbitrator each
                and the two arbitrators so appointed shall appoint the
                third arbitrator. Such arbitration shall be carried out in
                accordance with and subject to the provisions of the
                Arbitration and Conciliation Act, 1996 or any statutory
                modification or re-enactment thereof for the time being
                in force and the decision of the Arbitrator/s shall be final
                and binding upon all parties. It is clarified that only the
                two Designated Partners shall have the right to appoint
                the 2(two) Arbitrators. Such arbitration shall be held in
                Mumbai”.

5.     The Petitioner has invoked the Arbitration Clause and issued a

notice dated 23rd February 2026 (Page No.122). The Respondent No.4

has replied through Advocate dated 16 th March 2026 and in paragraph

No.7, he has admitted about the existence of LLP Agreement.

However, the name suggested by the Petitioner by way of unilateral

nomination is not acceptable to the said Respondent.

6.     The Respondent Nos.2 and 3 inspite of service, have not

appeared. The Respondent No.4 has already filed a reply (Page

No.140) and made certain allegations about the misconduct by the

Petitioner. It is not acceptable to the Petitioner. Such allegation is

outside the purview of an inquiry under Section 11 of the Arbitration

Satish Sangar                                                                   3/5
                                                            ARP-88-2026.doc


and Conciliation Act, 1996. There is no dispute about the existence of

an Arbitration Clause in the LLP Agreement.

7.     A case is made out for appointment of an Arbitrator. Hence,

following order:-

                              -: O R D E R :-

(I)    Mr.Drupad Patil, learned Advocate of this Court is hereby
       appointed as the sole Arbitrator to adjudicate upon the
       disputes and differences between the parties arising out and
       in connection with the matter referred above.
       Office address :- 1813, True Value Securities, Crescent
       Chambers, Tamarind Lane, Fort, Mumbai – 400 001.
       Email id :- [email protected]
       Contact No. :- 9766464655.
(II)   The place of arbitration shall be at Mumbai.
(III) A copy of this order will be communicated to the learned
       sole Arbitrator by the Advocates for the Petitioner within a
       period of one week from the date of upload of this order.
       The Petitioner shall provide the contact and communication
       particulars of the parties to the Arbitral Tribunal along with
       copy of this order.
(IV) The learned sole Arbitrator is requested to forward the
       statutory Statement of Disclosure under Section 11(8) read
       with Section 12(1) of the Arbitration and Conciliation Act,
       1996 to the parties within a period of two weeks from
       receipt of copy of this order.


Satish Sangar                                                            4/5
                                                            ARP-88-2026.doc


(V)    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.
(VI) All arbitral costs and fees of the Arbitral Tribunal shall be
       borne by the parties equally as per the Schedule.

8.     The Arbitration Petition is disposed of.



                                     [S. M. MODAK, J.]




Satish Sangar                                                            5/5


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