Resolution of Dispute through Arbitration

The court’s legal analysis in a recent case underscores the significance of settlement in arbitration proceedings. The decision to appoint a sole arbitrator to resolve the dispute highlights the court’s focus on ensuring a fair resolution of disputes between parties. Stay tuned to understand the nuances of arbitration and the role of settlement in legal proceedings.


  • The appellant disputed the allegations made by the respondent and replied to the same on 21.02.2007.
  • The respondent issued a legal notice on 17.04.2008 canceling the agreement of sale and forfeiting the advance amount paid.
  • The appellant attempted to settle the dispute amicably through extensive discussions and visits but was left with no legal remedy.
  • The appellant filed an application under Section 11(6) of the Act in the High Court of Karnataka seeking appointment of an arbitrator to resolve the dispute.
  • Despite a proposed settlement, the matter remained unresolved, leading to the filing of another petition under Section 11(6) in CMP No.228/2015.
  • The appellant later withdrew the petition from Karnataka High Court and filed a fresh application before the High Court of Judicature at Hyderabad seeking appointment of an arbitrator.
  • The dispute between the parties stemmed from an Agreement of Sale dated 23.11.2006 for a property in Bangalore.
  • The respondent’s failure to execute a sale deed as per the agreement led to the continuation of the dispute.
  • Several petitions and applications were filed by the appellant seeking the appointment of an arbitrator to resolve the ongoing dispute.

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  • The issue revolves around determining if there was a concluded settlement between the parties after the application in CMP No. 297/2009 was filed.
  • The key consideration is whether the dispute between the parties can be deemed as not subsisting for resolution through arbitration in light of any settlement.
  • The question of whether there is a settlement in the nature of Novation of the agreement of sale dated 23.11.2006 also needs to be addressed.
  • The order dated 05.07.2011 in CMP No. 297/2009, indicating that the matter has been settled out of court, is a crucial point for consideration in determining the existence of a settlement.

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  • The High Court of Karnataka had recorded a settlement, but sworn statements indicated that the proposed settlement did not fructify.
  • Efforts to settle differences with the help of mediators during the pending case were unsuccessful.
  • The settlement mentioned in the order dated 05.07.2011 was not recorded or made a part of the order, and no material was placed to show it was reduced to writing.
  • Despite notices, the respondent did not consent to the appointment of a sole arbitrator within the specified time.
  • The application for arbitration was made after withdrawing a previous petition, with no objection from the respondent’s counsel, indicating a revived dispute.
  • The failure to resolve the dispute amicably revives the original dispute, making it referable to arbitration.
  • The original dispute and the question of settlement between the parties are considered as disputes arising from the agreement between them.
  • The rejection of the application by the Chief Justice on grounds of Order II Rule 2 of CPC and res-judicata was not justified.
  • There was no abandonment of any claim or conclusive adjudication to establish res-judicata.
  • The alleged settlement was not recorded in previous proceedings or supported by documents, making it questionable.
  • A party to the arbitration agreement claiming a dispute should not be deprived of a forum based on technical grounds.
  • The resolution of the dispute, settlement status, limitation period, relief sought, and other merits should be considered in the arbitral proceedings.

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  • The petition is disposed of
  • A sole arbitrator is appointed to resolve the dispute between the parties
  • The High Court of Uttarakhand is appointed as the sole arbitrator
  • The appeal is allowed
  • The order dated 31.12.2018 passed in AA No.52/2016 is set aside


Case Number: C.A. No.-001510-001510 / 2021

Click here to read/download original judgement

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