The Hon’ble Supreme Court of India has disposed of Special Leave Petitions related to a dispute stemming from a 2009 Deed of Family Settlement. The Court has ordered the constitution of a three-member Arbitral Tribunal to adjudicate the ongoing disputes. Key arbitrators have been appointed, and the seat of arbitration will be Pune, with the tribunal to decide preliminary issues including arbitrability and the scope of non-compete clauses.
Supreme Court Directs Arbitration for Kirloskar Family Dispute
In a significant development, the Hon’ble Supreme Court of India has issued an order on August 11, 2026, disposing of Special Leave Petitions (SLPs) concerning disputes arising from a Deed of Family Settlement (DFS) dated September 11, 2009. The Court has directed the constitution of a three-member Arbitral Tribunal to adjudicate these complex matters.
Arbitral Tribunal Constitution and Key Appointments
The Supreme Court has appointed Justice Nitin Madhukar Jamdar, former Chief Justice of Kerala High Court, as the nominee Arbitrator on behalf of Kirloskar Brothers Limited (the Petitioner). On behalf of the contesting Respondents, Justice K. R. Shriram, former Chief Justice of Madras and Rajasthan High Courts, has been appointed as the nominee Arbitrator. The two appointed Arbitrators are tasked with jointly appointing the Presiding Arbitrator within four weeks. The seat of arbitration has been fixed at Pune.
Dispute Background and Arbitrability Clarification
The disputes originated from a 2009 DFS aimed at formalizing the separation of Kirloskar Group entities and included non-compete obligations and an arbitration clause. Kirloskar Brothers Limited had filed a Civil Suit seeking specific performance of the DFS and damages due to alleged breaches of non-compete clauses. The Supreme Court clarified that all contentions regarding arbitrability, the true scope of the DFS’s Clause 20, and whether non-signatories are bound by the arbitration agreement, have been left open to be decided by the Arbitral Tribunal as a preliminary issue. The Court further stated that observations made by the High Court do not have binding effect.
Financial Impact and Future Developments
The financial impact, if any, of these proceedings cannot be presently ascertained. Kirloskar Brothers Limited will continue to keep the stock exchanges informed of any material developments. The company has also indicated that the proceedings are available on its website.
Source: BSE
