R IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18^TH DAY OF MARCH, 2025 BEFORE THE HON'BLE MR JUSTICE SURAJ GOVINDARAJ WRIT PETITION NO. 42570 OF 2013 (GM-RES)

BETWEEN:

SRI. H. B. SHIVAKUMAR S/O. SRI. BASAPPA, AGED ABOUT 52 YEARS, R/AT. DOOR NO.541, 4^th MAIN, 6^th CROSS, 3^rd STAGE, KESARA, MYSORE - 570 007.

…PETITIONER (BY SRI. GANAPATHI BHAT VAJARAHALLI, ADVOCATE)

AND:

1. SRI. GOKULAM CHITS AND FINANCE PVT., COMPANY LTD., HAVING ITS REGISTERED OFFICE AT:

NO.28, MUTHUGRAMANI STREET, MAILAPUR, Digitally signed CHENNAI - 600 004.

by SHWETHA HAVING ITS BRANCH OFFICE AT:

RAGHAVEN DRA Location: HIGH MAHARAJA SHOPPING COMPLEX, COURT OF B.N.ROAD, MYSORE, KARNATAKA REP. BY ITS MANAGER - 570 007. 2. SRI. R. RAMAKRISHNA RAJU, S/O. SRI. VENKATANARASIMHA RAJU, AGE MAJOR, R/AT. DOOR NO.506, 3^RD STAGE, KESARE, MYSORE - 570 007.

…RESPONDENTS (BY SRI. H.K. SINGH, ADVOCATE FOR R1;

SRI. R. RAMAKRISHNA RAJU, ADVOCATE FOR R2 SD)

THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ARBITRATION PROCEEDINGS INITIATED BY THE 1ST RESPONDENT IN ARBITRATION CASE NO.843/2010 AND CASE NO.874/2010 BEFORE THE ARBITRATION FOR CENTRAL, CHENNAI, CHIT FUNDS CASES COURT, CHENNAI AT ANN-J & K INITIATED BY 1ST RESPONDENT AGAINST THE PETITIONER AND ETC.

THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN 'B' GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

CORAM: HON'BLE MR JUSTICE SURAJ GOVINDARAJ

ORAL ORDER

1. The Petitioner is before this Court seeking for the following reliefs;

"Issue WRIT of CERTORARI or any appropriate order quashing the Arbitration Proceedings initiated by the 1^st Respondent in Arbitration Case No.843/2010 and Case No.874/2010 before the Arbitration for Central, Chennai, Chit Funds Cases Court, Chennai at ANNEXURE -J & K initiated by 1^st respondent against the petitioner in the interest of justice and equity.

"Issue WRIT of MANDAMUS or any appropriate direction to the 1^st Respodent to take action against the property of the 2^nd Respondent as per the Sale Deeds and Encumbrance Certificate at ANNEXURE -

E. F. G & H in the interest of justice and equity.

GRANT SUCH OTHER RELIEFS as this Hon'ble Court Deems fit to grant on the facts and circumstances of the case, in the interest of justice and equity."

2. The Petitioner claims to be a guarantor for the loan of Rs.5,00,000/- availed by respondent No.2 from respondent No.1. Respondent No.1 had earlier filed a suit in O.S.No.419/2008 before the Principal Civil Judge (Junior Division) at Mysore for recovery of a sum of Rs.4,65,131/-. In the said suit, an application under Order 23 Rule 3 of the Code of Civil Procedure, 1908, was filed stating that respondent No.2 had undertaken to pay the claim amount within 2 months from that date and as such, the Petitioner contends that the dispute between respondent No.1 and respondent No.2 had been settled and compromised, accordingly, the suit was dismissed.

3. It is contended that after withdrawal of the suit when respondent No.2 did not make payment of the amount, respondent No.1 could have sought for attachment of the property of respondent No.2, which not having been done, the respondent No.1 has initiated Arbitration proceedings in Arbitration Nos.843/2010 and 874/2010 for recovery of the said amount before the Arbitrator for Central Chennai Chit Funds Case Court, Chennai.

4. The Petitioner, having received the notice apprehending that the Arbitrator appointed by respondent No.1 may not grant any relief to the Petitioner, has approached this Court.

5. The Petitioner contends that an illegal action has been taken by respondent No.1 against the Petitioner, and as such, this Court ought to exercise its powers and, under Articles 226 and 227 of the Constitution of India, issue a writ of certiorari and quash those proceedings.

6. Sri.Ganapathi Bhatt Vajarahalli, learned counsel for the Petitioner, submits that, 6.1. Respondent No.1 ought to have taken action against respondent No.2 borrower; instead of doing the same, respondent