Family Feud Escalates: Bombay HC Says No to Forced Mediation in Kalyani Dispute

In a landmark ruling on family litigation, the Bombay High Court has firmly held that courts cannot shove parties into mediation without mutual consent, even when blood ties run deep. Justice Rajesh S. Patil dismissed a plea to refer a high-stakes suit over a 1994 family arrangement to mediation, emphasizing the voluntary nature of alternative dispute resolution (ADR) under the Mediation Act, 2023, and Section 89 of the CPC. The decision came in Sugandha Hiremath & Anr. v. Babasaheb Neelkanth Kalyani & Ors. (Interim Application No. 5241 of 2025 in Suit No. 250 of 2023), where siblings and their corporate empires clashed.

Roots of a Bitter Family Rift

The drama unfolds within the prominent Kalyani family, industrialists tied to companies like BF Investment and Hikal Limited. Plaintiff Sugandha Hiremath, sister to defendant Babasaheb Neelkanth Kalyani (a 76-year-old Pune resident) and defendant Gaurishankar Kalyani, seeks specific performance of a 1994 family arrangement. Joined by her husband Jaidev, Sugandha accuses breaches involving family properties and businesses.

This isn't their first courtroom rodeo. Multiple suits simmer in Pune's District Court—including partition claims by Sugandha's children and probate petitions—while older recovery suits linger in Karad and Satara courts. A Supreme Court-directed mediation in 2018, led by senior counsel Shriram Panchu, and another by Pune's District Court both crashed and burned after months of talks. Defendant Babasaheb filed the interim application under Order VII Rule 11 CPC to reject the plaint, prompting the court's initial mediation nudge on March 27, 2026.

Plaintiffs Push for One More Shot, Defendant Draws a Hard Line

Senior counsel Janak Dwarkadas, for the plaintiffs, urged referral despite opposition, arguing even a "1% possibility" of success justifies it in family feuds. Citing Supreme Court cases like Afcons Infrastructure Ltd. v. Cherian Varkey (2010) and Mahendra Nath Soral v. Ravindranath Soral (2024 SCC OnLine SC 765), he insisted courts must explore ADR, especially pre-amendment, and that failure reports harm no one.

Dr. Virendra Tulzapurkar, senior counsel for Babasaheb, fired back: past mediations flopped, plaintiffs kept pushing parallel hearings in Pune post-suggestions, and vague emails (not proposals) were all they offered despite court liberty to negotiate. He highlighted media leaks after court hints—allegedly plaintiff-orchestrated—sparking investor calls and embarrassment. "If genuinely desirous," he quipped, why file suits at all? Babasaheb's 2025 reconciliation emails were rebuffed over "past violence."

Parsing the Law: Consent Trumps Familial Pressure

Justice Patil dissected the framework. Section 89 CPC (amended 2023) allows referral only if "elements of a settlement which may be acceptable to the parties" exist—no such vibe here. Unlike mandatory pre-institution mediation in commercial suits under Section 12A of the Commercial Courts Act, civil suits stay voluntary. The Mediation Act, 2023's Section 5 (not yet notified) screams "may voluntarily and with mutual consent," reflecting parliamentary intent post-standing committee tweaks.

Distinguishing precedents, the court leaned on Rupa and Co. Ltd. v. Firhad Hakim (2025 SCC OnLine SC 355): "Mediation cannot be thrusted upon either of the parties." Older cases like Afcons predate reforms and warn against ADR as delay tactics. No "bridging the gap" scenario existed—no close offers, just history of dead-end talks.

Key Observations from the Bench

  • On the core question : “The question before me is to decide, whether the parties who are closely related should be referred to mediation, when one of them is not willing to go for mediation.”
  • Legislative clarity : "Legislature in its wisdom wanted mediation to be kept as a voluntary act with consent of the parties and not something which is mandatory in nature."
  • No forced ADR : "The Mediation Act, 2023 does not provide for any mandatory mediation nor does it confer any power on the court to order mediation without consent of all parties."
  • Reality check : "I have no doubt that there does not exist any possibility of settlement through mediation between the parties."

No Mediation, Proceed to Battle

The court rejected the mediation request outright: "Hence, request made by the Plaintiffs to refer the matter to the mediation stands rejected." The suit marches to merits, underscoring that while family disputes scream for peace, courts can't play matchmaker without buy-in. This bolsters consensual mediation's primacy, potentially curbing tactical ADR referrals and signaling caution in prolonged family wars. As other sources note, it aligns with evolving law distinguishing commercial mandates from civil voluntarism, offering relief to defendants wary of endless "talks."