Pratik Vira vs Atul Shamji Bharani on 19 June, 2025

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Bombay High Court

Pratik Vira vs Atul Shamji Bharani on 19 June, 2025

2025:BHC-OS:9234                                                              902-CARAPL-9695-2025 copy.docx



          PURTI                     IN THE HIGH COURT OF JUDICATURE AT BOMBAY
          PRASAD
          PARAB
         Digitally signed by
         PURTI PRASAD
                                          ORDINARY ORIGINAL CIVIL JURISDICTION
         PARAB
         Date: 2025.06.23
         18:02:07 +0530


                               COMM. ARBITRATION APPLICATION (L) NO. 9695 OF 2025

                               1. Pratik Vira
                               2. Jayesh Vira
                               3. Kalpataru Advisory Services Limited
                               4. Vira Consultancy Services
                               5. Vira Realspace LLP
                               Known as Vira Group

                               Having address at :
                               24 A, Haria House, First Floor, St. Paul
                               Street, Dadar (East), Mumbai - 400 014.                    ...Applicants
                                       Versus
                               1. Atul Shamji Bharani
                               Office No.5, Floor-I, Plot-7, Sharda Sadan,
                               Swami Gyanjivancas Marg, Dadar Rly.
                               Station (East), Mumbai - 400 014.

                               2. Kashyap Mehta
                               2203, Artesia, Hind Cycle Road, T.V.
                               Estate, Worli, Mumbai - 400 030.
                               26/27 A-Wing Ahuja Tower.

                               3. Pancharatna Realtors Private Limited
                               13th Floor, B-1305, Kohinoor Square,
                               Plot No. 46, N.C. Kelkar Marg,
                               Opp Shivsena Bhavan, Dadar (West),
                               Mumbai - 400 028.

                               4. Sunshine Projects Private Limited
                               Office No.5, Floor-I, Plot-7, Sharda Sadan,
                               Swami Gyanjivancas Marg, Dadar Rly.
                               Station (East), Mumbai - 400 014.

                               5. Sun-N-Shine Entertainers Pvt. Ltd
                               1120, 11th Floor, B Wing, Panchashil Plaza,
                               Nyayamurti Sitaram Patkar Marg,
                               Gamdevi, Grant Road, Mumbai City,
                               Mumbai - 400 007.

                               (6) Sunshine Technobuild Private Limited
                               5, Floor - 1, Plot No.7, Sharda Sadan,
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          Swami Gyanjivandas Marg, Dadar Rly.
          Stn. Dadar (East), Mumbai - 400 014.

          7. Sunshine Global Technologies Pvt. Ltd
          5, Floor - 1, Plot No.7, Sharda Sadan,
          Swami Gyanjivandas Marg, Dadar Rly.
          Stn. Dadar (East), Mumbai - 400 014.

          8. Sunshine Tracon Private Limited
          17/2, Kshetra Mitra Lane 3rd Floor,
          Howrah, West Bengal, India - 711 106.
          Also Corporate Office:
          6th Floor, Sunshine Plaza, Naigaon Cross
          Road, Dadar East, Mumbai - 400 014.

          9. Sunshine Merchants Private Limited
          5, Floor - 1, Plot No.7, Sharda Sadan,
          Swami Gyanjivandas Marg, Dadar Rly.
          Stn., Dadar (East), Mumbai - 400 014.

          10. Sunshine Foundation
          5, Floor - 1, Plot No.7, Sharda Sadan,
          Swami Gyanjivandas Marg, Dadar Rly.
          Stn., Dadar (East), Mumbai - 400 014.

          11. Aarts Module International Private
          Limited
          5, Floor - 1, Plot No.7, Sharda Sadan,
          Swami Gyanjivandas Marg, Dadar Rly.
          Stn., Dadar (East), Mumbai - 400 014.

          12. Sunshine Infraserve Pvt. Ltd,
          5, Floor - 1, Plot No.7, Sharda Sadan,
          Swami Gyanjivandas Marg, Dadar Rly.
          Stn., Dadar (East), Mumbai - 400 014.

          13. Navketan Premises Pvt. Ltd.,
          5, Floor - 1, Plot No.7, Sharda Sadan,
          Swami Gyanjivandas Marg, Dadar Rly.
          Stn., Dadar (East), Mumbai - 400 014.

          14. Sunshine Realcon Pvt. Ltd.
          5, Floor - 1, Plot No.7, Sharda Sadan,
          Swami Gyanjivandas Marg, Dadar Rly.
          Stn., Dadar (East), Mumbai - 400 014.

          15. Sunshine Crown Realty LLP
          5, Floor - 1, Plot No.7, Sharda Sadan,
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          Swami Gyanjivandas Marg, Dadar Rly.
          Stn., Dadar (East), Mumbai - 400 014.

          16. Sunshine Housinginfra LLP
          5, Floor - 1, Plot No.7, Sharda Sadan,
          Swami Gyanjivandas Marg, Dadar Rly.
          Stn., Dadar (East), Mumbai - 400 014.

          17. Orchid Housinginfra LLP
          5, Floor - 1, Plot No.7, Sharda Sadan,
          Swami Gyanjivandas Marg, Dadar Rly.
          Stn., Dadar (East), Mumbai - 400 014.

          18. Sunshine Realspaces LLP
          102, First Floor, A Wing, Sigma Emerald
          Building, Off. Anand Nagar Vishal CHSL,
          Santacruz (East), Mumbai 400 055.

          19. Sunshine Hometown Construction
          LLP
          5, Floor - 1, Plot No.7, Sharda Sadan,
          Swami Gyanjivandas Marg, Dadar Rly.
          Stn., Dadar (East), Mumbai - 400 014.

          20. Orchid Planet Realty LLP
          601, Sunshine Plaza, Naigaum Cross
          Road, Dadar (East), Mumbai - 400 014.

          21. Goldnest Spaces LLP
          13th Floor, B - 1305, Kohinoor Square,
          Plot No. 46 N.C. Kelkar Marg,
          Opp. Shivsena Bhavan, Dadar (West),
          Mumbai - 400 028.

          22. Sunshine Urbainfra LLP
          5, Floor - 1, Plot No.7, Sharda Sadan,
          Swami Gyanjivandas Marg, Dadar Rly.
          Stn., Dadar (East), Mumbai - 400 014.

          23. Tangerine Construction LLP
          Floor G-2, Plot-435, Navneet Bhavan,
          Baburao Parulekar Marg, Dadar (West),
          Mumbai - 400 028.                                          ...Respondents

Mr. Zal Andhyarijuna, Senior Advocate a/w Mr. Durgaprasad Sabnis,
Mr.Hiten Lala and Mr. Yashesh Pajwani i/b Lex Firmus for the Applicants.


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Mr. Sanjay K. Jain a/w Mr. Hardik Jain i/b A.V.Jain Associates for
Respondent No.2.

Mr. Rushabh Sheth a/w Mr. Pratik Amin and Mr. Pratik Poojary i/b Pratik
Amin Associates for Respondent No.21.


                   CORAM            : SOMASEKHAR SUNDARESAN, J.
                   DATE             : JUNE 19, 2025

Oral Judgment :


1. This Application has been filed under Section 11 of the

Arbitration and Conciliation Act, 1996 ( “the Act”), seeking reference of

disputes and differences between the parties under Memorandum of

Settlement dated October 31, 2018 (” MOS”) to arbitration. The Applicants

and the Respondents are parties who have executed the MOS after

participating in the mediation at the Supreme Court’s mediation centre. It

is the case of the Applicants that on the very same day, the parties also

executed a side letter titled as Letter of Agreement ( “LOA”) which, on the

face of it, is signed by the very same parties.

2. The LOA records that all terms and conditions of the MOS stand

incorporated in it, and would govern it, and that the LOA would constitute

an integral part of the MOS. The parties have also presented a joint

application to the Supreme Court about the MOS since the settlement had

been arrived at pursuant to the intervention of mediation center in the

Supreme Court. They did not present the LOA to the Supreme Court, and it

is evidently a side letter.

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3. The case of the Applicants is that the parties have executed the

MOS and the LOA, and they have consciously chosen to keep certain

additional features in the LOA also executed by the parties, but they jointly

agreed to keep it on the side.

4. Most of the Respondents constitute the ‘Sunshine Group’ while

the Applicants constitute the ‘Vira Group’. There are certain respondents

who belong to neither group but are party to the MOS and the LOA.

5. The arbitration agreement is contained in Clause 17 of the MOS

(found at Page No.61 of the Application). In the interest of brevity, the

arbitration agreement is not being extracted here. Suffice it to say that this

matter falls within the jurisdiction of this Court.

6. Learned Counsel for the Respondents comprising the Sunshine

Group has made submissions at a great length, as to why this Court ought

to dismiss this Application and not refer the parties to arbitration. His first

contention is that the invocation of arbitration under the LOA could never

be considered since it does not independently contain an arbitration clause.

He would cite case law to point out that a mere reference to another

agreement would be inadequate to constitute an arbitration agreement and

there should be an explicit reference to the arbitration clause, specifically

stating that it was being incorporated, for the conscious consent to arbitrate

to manifest itself.

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7. The second objection on behalf of the Respondents comprising

the Sunshine Group is that the LOA itself does not exist. According to him,

while on the face of it the LOA is signed by the Respondents represented by

him, he would allege that the signatures are forged.

8. The third objection is that even if the LOA exists, it does not have

an arbitration clause in it. Therefore, even if the existence of LOA is proven

the existence of an arbitration agreement is not proven. Therefore, it would

not be possible to refer disputes and differences arising out of the LOA to

arbitration, since the sine qua non of existence of the arbitration agreement

under Section 11(6A) of the Act is not met.

9. Towards this end, he would rely upon the decision of the

Supreme Court in NBCC (India) Limited1 and the reliance placed therein on

M.R. Engineers2.

10. Learned Counsel for Respondent No. 21, a Respondent said to

not form part of the Sunshine Group, would make different a submission.

He would submit that arbitration agreement contains the requirement of

conciliation and that conciliation efforts have not been undertaken.

Therefore, he would contend, the invocation of arbitration is premature.

11. Having heard Learned Counsel for the parties, at length

disproportionate with the requirement for a Section 11 Application (only to

1
NBCC (India) Limited Vs. Zillion Infraprojects Private Limited, (2024) 7 SCC 174
2
M.R. Engineers & Contractors (P) Ltd. vs. Som Datt Builders Ltd.
– (2009) 7 SCC 696
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assuage any feeling that the vehement and strong objections are not

permitted to be ventilated), I am afraid none of these objections warrant

rejection of this Application.

12. The objections squarely relate to merits of the case, which

squarely fall in the domain of the Arbitral Tribunal. On the face of the

record, the LOA exists and the very same parties who have executed the

MOS have executed the LOA. The existence of the LOA is being denied first

on the premise that the signatures are forged. Thereafter, the absence of a

separate arbitration clause in the LOA is sought to be relied on to contend

that disputes under the LOA are not arbitrable. While the LOA indeed

draws reference and purports to incorporate all provisions of the MOS into

it and also purports to supplement the MOS, the arbitration clause is not

explicitly reiterated in the LOA.

13. On the face of it, the LOA purports to supplement the MOS

signed by the very same parties on the very same day. For whatever

commercial reasons, the parties in their wisdom, chose to keep the bargain

contained in the LOA out of the scope of the official MOS presented in their

application to the Supreme Court, but it is for the Arbitral Tribunal to

consider the interplay between these two instruments and determine

whether the LOA forms an integral part of the MOA or the other way

around.

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14. There is no quarrel that an arbitration agreement is contained in

the MOS. That arbitration agreement exists. The LOA purports to

supplement the MOS. If on considering evidence, the Arbitral Tribunal

concludes that the LOA is merely an insertion into the MOS, then the

arbitration agreement that governs the MOS would govern the rights and

obligations inserted into the MOS through the LOA. If the Arbitral Tribunal

concludes that the LOA and the MOS are two distinct instruments, one not

merging into the other, then the contention that the arbitration agreement

does not exist insofar as disputes relating to the rights and obligations

introduced through the LOA, would gain ground.

15. On the face of the record, an arbitration agreement exists in the

MOS. On the face of the record, the LOA is an integral part of the MOS and

is executed by the very same parties on the very same day. Denial of

execution of the LOA is a matter of evidence and existential substance,

which falls in the domain of the Arbitral Tribunal. On the face of it, the

parties intended the LOA to be an appendage to the MOS and therefore it

would only be fair to grant liberty to the parties to convince the Arbitral

Tribunal about their respective stands insofar as the bundle of rights and

obligations introduced through the LOA is concerned and make

submissions about coverage by arbitration by appropriate application under

Section 16 of the Act.

16. The reference to arbitration being made hereby is to the MOS,

which has an admitted arbitration agreement. Whether the MOS includes

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the LOA is a mixed question of fact and law, on which the parties would

need to address the Arbitral Tribunal. If the MOS, upon appreciation of

evidence, is held by the Arbitral Tribunal to include the LOA it would follow

that the Arbitral Tribunal will consider the disputes and differences raised

under the MOS as supplemented by the LOA. If the Arbitral Tribunal

arrives at a view that the LOA is not an integral part of the MOS the

consequences would follow in the arbitration proceedings.

17. None of these issues raised at this stage falls within the

jurisdiction of this Court under Section 11 of the Act. Indeed, the legislature

has made an explicit intervention in Section 11(6A) of the Act, confining the

scope of jurisdiction of this Court to “examination” of the existence of an

arbitration agreement. The conscious choice of legislature is that this Court

must not “adjudicate” these matters but must “examine” i.e. inspect the

record and examine if the arbitration agreement exists.

18. Paragraph No. 151 in the Interplay Judgement3 squarely states

that the interpretation of Section 11(6) had a long and chequered history in

that Court, particularly in respect of the nature of the function of the Court.

The judgment goes on to articulate the varying levels of intervention

effected by that Court while considering Section 11, and eventually squarely

and explicitly posits that the scope of the jurisdiction of Section 11 Court

must strictly be followed in terms of Section 11(6A) of the Act and in no

other manner.

3
In Re: Interplay Between Arbitration Agreements under the Arbitration and
Conciliation Act, 1996
and Stamp Act, 1899 – (2024) 6 SCC 1
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19. In Paragraph No.165 of Interplay Judgment, the Supreme Court

specifically uses the following statement :

“Similarly, the validity of an arbitration agreement, in view of Section
7
, should be restricted to the requirement of formal validity such as the
requirement that the agreement be in writing. This interpretation also
gives true effect to the doctrine of competence by leaving the issue of
substantive existence and validity of an arbitration agreement to be
decided by Arbitral Tribunal under Section 16. We accordingly, clarify
the position of law laid down in Vidya Drolia in the context of Section 8
and Section 1 of the Arbitration Act”.

[Emphasis Supplied]

20. A plain reading of the foregoing would show that the

examination of validity of an arbitration agreement should be restricted to

checking the formal and valid existence i.e. as to whether the agreement is

in writing. In the facts of the present case, both the MOS and indeed the

LOA formally exist in writing and are formally signed by all the respective

parties. Whether LOA is an integral part of the MOS and thereby whether

its contents fall within the scope of the arbitration agreement, is a question

of evidence that the Arbitral Tribunal must examine.

21. Learned Counsel for the Respondents comprising the Sunshine

Group would submit that all these observations in the Interplay Judgment

cannot be read in this manner. He would contend that all that this

judgment did was to see if the scope of reference under Section 8 of the Act

and Section 11 of the Act are identical in nature. I am unable to agree with

this. A judgment should be read for the issues that are decided. Faced with

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the Section 11 Courts delving deep into every facet of law connected to

formation of contracts (including adequacy of stamp duty), the Supreme

Court constituted a seven-judge bench to deal with this issue and that led to

the judgment. This bigger context and purpose of formation of that bench

cannot be lost sight of.

22. The principles of interpretation of statute are completely

different from the principles of interpretation of judgments. The Supreme

Court has taken pains to list out the journey of the law under Section 11 of

the Act and has squarely articulated that Section 11 Court must not step

outside the scope of Section 11(6A) of the Act.

23. Consequently, the reliance upon NBCC (India) Limited, which

was rendered prior in time to the Interplay Judgment is of no assistance to

the Respondents comprising the Sunshine Group.

24. That apart, even a plain reading of the NBCC (India) Limited

judgment would show that in that case a separate document called a “Letter

of Intent” contained an explicit clause that provided for jurisdiction over all

disputes as belonging to Civil Courts having jurisdiction in Delhi alone. The

Court was called upon to compare the Letter of Intent with another

agreement which contained an arbitration clause. In that context, the

Supreme Court ruled that unless the reference to the arbitration clause was

explicitly reiterated in the second instrument under which the arbitration is

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sought to be incorporated, the arbitration agreement would not exist.

Therefore, the decision in NBCC (India) Limited is not something that

would be of any assistance to the Respondents in this case in the context of

the jurisdiction now being exercised in these proceedings.

25. As regards reliance upon M.R. Engineers, there can be no quarrel

with the articulation on how to read the scope and intent of Section 7(5) of

the Act. None of these can be quarreled with. Even in the facts of this case,

whether incorporation of the arbitration clause in a document executed

later in time is necessary, if the parties to the two documents are identically

the same and in fact purport to supplement the very document that they

have executed with an arbitration clause, is a matter of evidence, for which

only the Arbitral Tribunal has power to examine the record to form a view.

Therefore, even the ruling in M.R. Engineers would be of no assistance to

the Respondents in asking for this Application to be rejected.

26. As regards, the objections made on behalf of Respondent No.21,

it is now trite law that when a pre-arbitration conciliation procedure is

stipulated, it must also be seen whether after invocation of arbitration, the

other parties raising objection to pre-arbitration conciliation not having

taken place, made any contributory steps to attempting conciliation. In the

pre-arbitration conciliation provision, the parties have to engage and

articulate potential consideration. It is seen that the invocation was done

way back on December 7, 2024. When asked what Respondent No.21 took

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to participate in conciliation efforts, the response was that it was not the

Respondents’ to attempt conciliation but it was for the Applicants to pursue

it. This stand itself would indicate that the conciliation is illusory and the

contention is only being made to postpone consideration of this

Application.

27. Even in this context, the Supreme Court has clearly declared the

law in SBI General4, where it was held that the Section 11 Court must not get

into whether a party had discharged another under the contract containing

the arbitration clause. That activity falls in the domain of the arbitral

tribunal. By the same token, the contention about pre-arbitration

procedures is a matter that can be raised before the Arbitral Tribunal.

28. In these circumstances, I am satisfied that no useful purpose

would be served by keeping this Application pending any further, it

deserves to be allowed since the existence of the arbitration agreement in

the MOS is writ large on the face of record and is in fact not even denied.

Whether the LOA forms an integral part of the MOS is a matter left to the

Arbitral Tribunal to decide. The Applicants shall be at liberty to address the

Arbitral Tribunal as to whether the LOA truly supplements the MOS and is

an integral part of the same. The Respondents are at liberty to to address

the Arbitral Tribunal as to why the LOA is an independent contract,

necessitating a separate arbitration agreement and that the parties intended

4
SBI General Insurance Co. Ltd. Vs. Krish Spinning – 2024 SCC OnLine SC 1754
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one bundle of rights and obligations to be covered by arbitration and

another bundle not to be so covered. The Arbitral Tribunal shall have

liberty to decide this issue in such sequence as it finds appropriate. If it

comes a view that the LOA is an integral part of the MOS (as it purports to

be), it is for the Arbitral Tribunal to decide whether to deal with the LOA.

Needless to say, that the Respondents are at liberty to take out an

application under Section 16 of the Act insofar as it relates to the scope of

jurisdiction covering the LOA.

29. With the aforesaid directions, taking into account the inputs

from the officers of the Court on the identity of the arbitrator, this

Application is finally disposed of in the following terms:-

A] Justice (Retired) Shri. Akil Kureshi, a Former Judge of
this Court is hereby appointed as the Sole Arbitrator to
adjudicate upon the disputes and differences between the
parties;

                   Address :        617, Raheja Chambers,
                                    Nariman Point, Mumbai.
                   E mail : [email protected]


                   B]      A copy of this Order will be communicated to the

Learned Sole Arbitrator by the Advocate for the Applicants
within a period of one week from the date on which this order
is uploaded on the website of this Court. The Applicants shall
provide the contact and communication particulars of the
parties to the Arbitral Tribunal along with a copy of this Order;

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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 Advocate for the Applicants
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 Application and a copy of the same
shall be furnished by the Advocate for the Applicants to the
Respondents;

D] 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;

E] 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.

30. Commercial Arbitration Petition No. 270 of 2024 is a Petition

under Section 9 of the Act. The Section 9 Petition is converted into an

Application under Section 17 of the Act for consideration by the Arbitral

Tribunal. Any pleadings that the parties desire to make in relation to the

Section 9 Petition may be made before the Arbitral Tribunal where the

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proceedings would continue in the form of proceedings under Section 17 of

the Act.

31. Both the proceedings are finally disposed of in the aforesaid

terms.

32. Needless to say, nothing contained in this order is an expression

of an opinion on merits of the matter or the relative strength of the parties.

All issues on merits are expressly kept open to be agitated before the

arbitral tribunal appointed hereby.

33. 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.

[ SOMASEKHAR SUNDARESAN, J.]

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