Jurisdiction for arbitration disputes arises from specific agreements despite objections based on location.

ORDER

Petitioner is a non banking financial company having its registered office at Thrissur, Kerala. It is engaged in the business of advancing loans and other financial facilities. The 1^st respondent availed a loan for an amount of Rs.3 Crores from the petitioner on

27.12.2023.

2. Annexure I is a copy of the agreement dated 27.12.2023 executed between the petitioner and the 1^st respondent. According to the understanding between the parties, the loan was repayable in 30 monthly instalments of Rs.12,19,916/- each, inclusive of interest at 16% per annum on diminishing balance commencing from 01.01.2024. Annexure II is a copy of hypothecation deed executed on the same date by the 1^st respondent. Annexures III and IV are deeds of guarantee executed on the same date by respondents 2 and 3 in favour of the petitioner. All these agreements contain arbitration clauses for resolution of disputes between the parties.

3. The petitioner submits that the 1^st respondent failed to repay the loan amounts as agreed. When the 1^st respondent committed default in payment of the monthly instalments, the petitioner issued Annexures V, VI and VII notices to respondents 1, 2 and 3 respectively. Those notices were issued invoking the arbitration clauses in respective agreements. It is further submitted by the petitioner that though notices were served on the respondents, there was no reply from any of them. In such circumstances, the petitioner approached this Court in this arbitration request.

4. Notices were issued to respondents and they have entered appearance through the learned counsel. A statement of objection has been filed by them.

5. Heard the learned counsel for the petitioner and also the learned counsel for the respondents.

6. On hearing the respective counsel and perusal of the pleadings and documents, it is clear that disputes have arisen between the parties and the agreements between the parties contain arbitration clauses. Though there are separate agreements, all of them are related to the same transaction. The objection raised by the respondents in the statement filed is with regard to cause of action. According to them no part of cause of action has arisen within the State of Kerala. However, the learned counsel for the petitioner pointed out that the relevant clauses in Annexures I to IV specifies that the disputes that may arise between the parties shall be dealt with exclusively by the Courts at Thrissur, Kerala. Further he pointed out that the parties have agreed that in case of differences of opinion regarding appointment of arbitrator, the High Court of Kerala shall be approached and the directions issued and orders passed by this Court will be binding on all parties. He therefore submitted that there is no merit in the contention regarding lack of jurisdiction.

7. In view of the specific statements in the relevant clauses regarding jurisdiction, I am of the view that the objection raised by the respondents shall not prevent this Court from allowing this arbitration request. As disputes have arisen between the parties and the agreements contain arbitration clauses, this arbitration request is allowed.

8. The learned counsel for the petitioner as well as the learned counsel appearing for the respondents submitted that though it is mentioned in the relevant clauses in the agreements that the Courts at Thrissur shall have jurisdiction to deal with disputes between the parties, there is no specific mention regarding the place of arbitration in the agreements. They, therefore, submitted that the parties are willing to proceed with the arbitration at Ernakulam.

Accordingly the following directions are issued:

1. The Kerala High Court Arbitration Centre is directed to nominate a Senior Advocate from