Supreme Court To Hear Industrialist Sanjay Kirloskar's Plea On March 15 In Family Feud

The Supreme Court will hear on March 15 a plea by Kirloskar Brothers Ltd (KBL) CMD Sanjay Kirloskar challenging a Bombay High Court order directing arbitration in a family feud related to assets.

A bench headed by Chief Justice N V Ramana was told by senior advocate A M Singhvi, appearing for KBL, on Friday that the other side has been taking benefit of the mediation and repeated adjournments of hearings in the case and is involved in promotional and other activities.

“Taking advantage of the mediation and adjourning of the matter repeatedly and the other side is doing promotional activities, advertisements and my suit is stayed. The court directed twice its listing but it did not come up. They (other side) is taking benefit of the time period of the mediation,” Singhvi submitted before the bench, also comprising Justices A S Bopanna and Hima Kohli.

“We will list it on March 15,” the bench said.

On February 4, the court was informed by KBL that the mediation by former apex court judge Indu Malhotra to settle the Kriloskar family feud has failed.

The bench had said it would then hear the case.

Prior to this, the bench had asked industrialist Atul Chandrakant Kirloskar and 13 others, made respondents by KBL, to apprise it of their opinion on the issue of mediation to settle the matter.

On July 27 last year, the top court had ordered status quo in the case between the feuding family members of the Kirloskar group. This was also extended to the proceedings in the Pune civil court on KBL seeking damages for violation of the family deed.

Asking the parties involved in the case to explore the possibility of mediation, the bench had issued notice on the appeal by Sanjay Kirloskar and had asked them to file replies.

The Supreme Court had asked the Kirloskar brothers -- Sanjay and Atul -- to explore mediation to resolve the family dispute relating to the assets.

The feud over the deed of family settlement relating to the assets of the more than 130-year Kirloskar group reached the apex court after Sanjay Kirloskar appealed against the Bombay High Court order that had relegated the dispute to arbitration.

In the appeal, it was contended that the order of the high court is factually and legally untenable and misconceived and it contains serious errors of fact and law and incorrect findings have been arrived at on an erroneous basis.

The Kirloskar family members had entered into a deed of family settlement (DFS) in 2009.

According to the appeal, under the DFS, disputes relating to the Kirloskar Institute of Advanced Management Studies (KIAMS) and Kirloskar Foundation (KF) are to be resolved unanimously. In case there is no unanimity, the issue is to be referred to two arbitrators -- Anil Alwani and C H Naniwadekar. If they differ in opinion, the dispute is to be referred to the third arbitrator, Srikrishna Inamdar.

DFS makes it clear that only disputes relating to KIAMS and KF shall be referred for arbitration and not other disputes, the appeal said.

Another DFS clause states that no one in the family will compete with any other member in business, it added.

According to KBL, this clause has been violated by Rahul and Atul who have taken a stake in a pump manufacturing company, namely La Gajjar Machineries Pvt Ltd.

Being aggrieved, KBL had earlier filed a case in a Pune civil court seeking Rs 750 crore damages for violation of the agreement. During the pendency of the suit in Pune court, Atul, Rahul and other respondents moved the Bombay High Court saying DFS had a clause that in case of dispute the parties can go in for arbitration.

The high court, hearing their plea, had agreed with them and ordered a resolution through arbitration.