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2026 Supreme(Online)(Kar) 5415

THE HIGH COURT OF KARNATAKA
MR. S.R.KRISHNA KUMAR, J
QUANTUM INVESTMENT PARTNERS LLC – Appellant
Versus
M/S DURGA SHREE HEIGHTS PVT LTD – Respondent
WP No. 31184 of 2025 | Writ Petition No. 24078 of 2025 | Writ Petition No. 24085 of 2025 | Writ Petition No. 31410 of 2025



Advocates:
For the Appellants/Petitioners:SRI. DHYAN CHINNAPPA, SENIOR COUNSEL APPEARING FOR SRI. KAUSTUBH JAGIRDAR, ADVOCATE
For the Respondents:SRI. H.S. DWARAKANATH, ADVOCATE FOR R-1 TO R-5, SRI. S.K. MITHUN, ADVOCATE FOR C/R-1

The failure to provide sufficient justification for stay orders leads to a lack of procedural fairness; amendments to pleadings are necessary for an adjudication process.

Headnote:The petitioners sought to set aside the impugned orders dismissing their applications before the commercial court regarding the enforcement of a compromise order. The court found that the commercial court had failed to provide adequate reasoning for its decisions, particularly in granting a stay of proceedings without valid justification. However, it upheld the amendment application allowing for a more comprehensive presentation of pleadings. The court ultimately allowed the appeals for certain petitions while dismissing others and ordered the commercial court to reconsider its decision regarding the stay, reaffirming the procedural correctness of allowing petitioners to respond to amended pleadings.

Table of Content
1. overview of case filings and related proceedings. (Para 1 , 2 , 3)
2. arguments regarding the procedural appropriateness of stay applications. (Para 4 , 5 , 6 , 7)
3. court's review and rationale on commercial court's orders. (Para 8 , 9 , 10 , 11)
4. final verdict and directives regarding case proceedings. (Para 12)

ORAL ORDER

W.P.No.31184/2025 and W.P.No.24078/2025 arise out of Com.Misc.No.7/2025 filed by the respondents against the petitioners herein and pending before the commercial court.

W.P.No.31410/2025 and W.P.No.24085/2025 arise out of Com.Misc.No.8/2025 also filed by the respondents against the petitioners herein is pending before the commercial court.

2. Since all the petitions are between the same parties in relation to the similar / identical subject matter, they are taken up together for consideration.

3. A perusal of the material on record will indicate that the petitioners in all the petitions instituted Com.A.A.Nos.333/2022 and 334/2022 against the respondents under Section 9 of the Arbitration and Conciliation Act , 1996. The respondents entered appearance in the said proceedings, which was disposed of vide order dated 23.02.2023 recording the terms of compromise entered into between the parties who had filed a joint compromise petition. Subsequently, the respondents herein filed Com.Misc.Nos.7/2025 8/2025 under Order 23 Rule 3A r/w Section 151 CPC seeking setting aside of the compromise reported in Com.AA.333/2022 and Com.AA.334/2022 respectively on the ground that the same was illegal, void and opposed to law. The said Commercial Miscellaneous proceedings in Com.Mis.Nos.7/2025 and 8/2025 are opposed and contested by the petitioners herein. Meanwhile, the petitioners have instituted execution proceedings to enforce the compromise decree / order passed by the commercial court dated 23.02.2023.

4. In the said proceedings filed by the respondents, they also filed an application I.A.No.1 for stay and an application I.A.No.3 seeking amendment of the Miscellaneous petitions. The commercial court allowed both applications filed by the respondents. Aggrieved by the impugned order of the commercial court allowing I.A.No.1 in both Com.Misc.Nos.7/2025 and 8/2025, petitioner has preferred W.P.No.31184/2025 and W.P.No.24078/2025. Similarly, aggrieved by the impugned order of the commercial court allowing I.A.No.3 in both Com.Misc.Nos.7/2025 and 8/2025, petitioner has preferred W.P.No.31410/2025 and W.P.No.24085/2025.

5. Heard learned Senior counsel for the petitioners and learned counsel for respondents and perused the material on record.

6. In addition to reiterating the various contentions urged in the petition and referring to the material on record, learned Senior counsel for the petitioners submits that the commercial court committed a grave and serious error of law and fact in allowing I.A.No.1 for stay filed by the respondents by improper and erroneous appreciation of the material on record and without appreciating that neither valid nor sufficient ground had been made out by the respondents for grant of stay. It was submitted that the commercial court erred in granting stay in favour of the respondents unconditionally and summarily without putting them on terms or imposing any conditions for the purpose of grant of stay in their favour and without appreciating that the respondents and petitioners had given effect to and acted upon the compromise dated 23.02.2023 entered into between the parties and as such, the impugned order passed by the commercial court deserves to be set aside and the application filed by the respondents was liable to be dismissed.

6.1 Learned Senior counsel would also invite my attention to the proposed amendment sought for by the respondents in I.A.No.3 in order to contend that the commercial court failed to appreciate that the said amendment was neither necessary nor relevant for the purpose of adjudication of the issues in controversy between the parties and as such, the impugned

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