[Cites 7, Cited by 0]

Madras High Court

Mrf Limited vs Erdac Solutions Pvt Ltd on 19 January, 2026

Author: N.Anand Venkatesh

Bench: N.Anand Venkatesh

    2026:MHC:223


                                                                            Arbitration Original Petition No.82 of 2025
                                  IN THE HIGH COURT OF JUDICATURE AT MADRAS

                                                   DATED: 19.01.2026

                                                            CORAM

                          THE HONOURABLE MR.JUSTICE N.ANAND VENKATESH

                                       Arbitration Original Petition No.82 of 2025
                                                 and A.No.5112 of 2025


                     MRF Limited,
                     Rep. By its General Manager – Secretarial,
                     Mr.K.G.George,
                     No.114, Greams Road,
                     Chennai – 600 006.                                                         .... Petitioner

                                                                Vs.

                     1. Erdac Solutions Pvt Ltd.,
                        No.39/1, 2nd Floor,
                        Shanmugha Arcade, NGEF Lane,
                        Binnamaangala First State (Indiranagar 1st Stage),
                        Bangalore – 560 038.

                     2. Mr.Pramod Vaidya,
                        Arbitrator,
                        Erdac Solutions Pvt Ltd.,
                        No.39/1, 2nd floor,
                        Shanmugha Arcade, NGEF Lane,
                        Binnamaangala First Stage (Indira nagar 1st stage)
                        Bangalore – 560 038.

                     3. Mrs. Sandhya D Purohit,
                        1704/1705, Prathamesh Tower,
                        New Link Road,
                        Near New MGB Colony,
                        Borivali (west), Mumbai – 400 091.                                      .... Respondents


                     1/11



https://www.mhc.tn.gov.in/judis                 ( Uploaded on: 22/01/2026 01:45:02 pm )
                                                                               Arbitration Original Petition No.82 of 2025
                                  Arbitration Original Petition filed under Section 34(2)(b)(ii) read
                     with explanation 1 and 2 and Section 31(3)(a) of the Arbitration and
                     Conciliation Act, 1996, to set aside the impugned award dated 18.06.2025
                     passed by the Arbitrator, the 2nd respondent herein in case No.NSE-
                     LC-2025-02-306451.

                                        For Petitioner         : Mr.M.Vijayan,
                                                                 for M/s.King & Partridge
                                        For Respondent         : No appearance [R1]
                                                                  R2- Arbitrator
                                                                  Ms.Madhupreetha Elango [R3]

                                                                *****
                                                               ORDER

This petition has been filed to set aside the impugned award dated

18.06.2025 passed by the second respondent in case No.NSE-LC-2025-

02-306451.

2. The 3rd respondent was holding shares in the petitioner company.

The shares were held in the name of Mrs.Shanthi D. Purohit along with

her sister-in-law. The 3rd respondent was seeking for change of name as

Sandhya D. Purohit. In spite of providing all the particulars and

documents and also making a declaration, the petitioner refused to effect

the change of name. Aggrieved by the same, the petitioner raised the

arbitration dispute in line with the Master Circular for online resolution of

disputes in the Indian Securities Market dated 31.07.2023.

https://www.mhc.tn.gov.in/judis ( Uploaded on: 22/01/2026 01:45:02 pm ) Arbitration Original Petition No.82 of 2025

3.The Arbitral Tribunal through award dated 18.06.2025 directed

the petitioner to complete the process regarding the change of name of the

3rd respondent within two weeks from the date of the award. Aggrieved by

the same, the present petition has been filed before this Court.

4. When this petition came up for admission on 17.10.2025, this

Court entertained the petition mainly on the ground that the online award

was bereft of reasons and hence, it is in violation of Section 31(5) of the

Arbitration and Conciliation Act, 1996 [for brevity ‘the Act’].

5. After service of notice, the 3 rd respondent has filed counter

affidavit. Apart from the merits of the case, the 3 rd respondent has raised a

preliminary objection on the maintainability of the present petition before

this Court.

6. In view of the preliminary objection raised by the 3 rd respondent

on the jurisdiction of this Court to entertain this petition, this Court

directed the learned counsel appearing on either side to make their

submissions on the issue of jurisdiction.

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7. The learned counsel for the 3 respondent submitted that the 3rd rd

respondent invoked the Master Circular and pursuant to the same, the

Arbitral Tribunal has passed an award. As per clause 27 of the Master

Circular, the venue and seat of the online proceedings has been dealt with

and for the purpose of this case, the learned counsel relied upon clause

27(a) of the Master Circular, which is extracted hereunder:

“27. The venue and seat of the online proceedings shall be deemed to be the place:

a) In case of disputes between investor/client and listed companies (including their registrar and share transfer agents) or any of the specified intermediaries / regulated entities in securities market (as specified in Schedule A): where the investor resides permanently or, where the investor is not an individual, the place where it is registered in India or has its principal place of business in India, as provided in the relevant KYC documents.”

8. The learned counsel submitted that as per the above clause, the

permanent residence of the 3rd respondent falls within Mumbai and

therefore that should be considered as the seat of present arbitration

proceedings. In such an event, it was contended that, only the Bombay

High Court will have the jurisdiction to entertain any petition filed under

Section 34 of the Act challenging the award. The learned counsel in order

to substantiate her submission relied upon, the judgment of the Apex

https://www.mhc.tn.gov.in/judis ( Uploaded on: 22/01/2026 01:45:02 pm ) Arbitration Original Petition No.82 of 2025 Court in the case of BGS SGS SOMA JV Vs. NHPC Limited reported in

(2020) 4 SCC 234 and in the case of Hindustan Construction Company

Limited Vs. NHPC Limited and Anr. reported in (2020) 4 SCC 310.

9. Per contra, the learned counsel for the petitioner submitted that

the very invocation of the arbitration by the 3 rd respondent is

unsustainable since the Master Circular will come into play only where

the dispute arise out of an activity in the Securities Market and in the case

in hand, the actual dispute arose out of the rejection of the claim made by

the 3rd respondent seeking for rectification of the name in the register. The

learned counsel therefore submitted that the Arbitral Tribunal lacked

jurisdiction to entertain the dispute and therefore, the award itself must be

construed as a nullity in the eye of law. The learned counsel further

submitted that the manner in which, the arbitration proceedings were

conducted has been explained at paragraph 10 of the petition and adding

insult to injury, the award is not supported by any reason and hence, it is

in violation of Section 31(5) of the Act and therefore, that is also a ground

to uphold that the award is nullity. In view of the same, the award being a

nullity, can certainly be challenged before this Court, since the Registered

office of the petitioner is situated within the jurisdiction of this Court.

https://www.mhc.tn.gov.in/judis ( Uploaded on: 22/01/2026 01:45:02 pm ) Arbitration Original Petition No.82 of 2025

10. This Court has carefully considered the submissions made on

either side and the materials available on record.

11. The 3rd respondent had invoked the arbitration based on the

Master circular for online dispute resolution dated 31.07.2023 (updated as

on 20.12.2023). According to the 3rd respondent, the arbitration

proceedings can be invoked even in cases where a shareholder is seeking

for change in name and which is refused by the concerned entity.

12. On a careful reading of the online award passed by the Arbitral

Tribunal, it is seen that there is no indication that the petitioner had raised

any preliminary objection before the Arbitral Tribunal with respect to its

jurisdiction. On the other hand, the award passed by the Arbitral Tribunal

reads as if the petitioner does not have any objection in making the

required change of name in the company records provided that the

Arbitral Tribunal gives an award based on the documents submitted by

the 3rd respondent. For better appreciation, the relevant portion in the

award is extracted hereunder:

“As a part of respondent’s submissions during the online hearing, respondent declared that respondent will have no objection to making the required change of name in the company records provided the arbitration panel gives

https://www.mhc.tn.gov.in/judis ( Uploaded on: 22/01/2026 01:45:02 pm ) Arbitration Original Petition No.82 of 2025 an award based on the documents submitted to the arbitration panel confirming that Ms.Shanti D. Purohit and Ms.Sandhya D. Purohit are two names of one and the same person. Respondent also agreed to the time line for completing the process of name change as per applicant’s request “within two weeks from the date of award”

13. Even in the present petition that has been filed challenging the

award, the petitioner has not specifically questioned the jurisdiction of the

Arbitral Tribunal and what has been questioned is regarding the violation

of Section 31(5) of the Act on the ground that the award is bereft of any

reasons.

14. It is now too well settled that, where the jurisdiction of the

Arbitral Tribunal is put to question, it has to be raised before the Arbitral

Tribunal under Section 16 of the Act, so that the Tribunal will be able to

deal with that issue before passing the award. However, as a March of

Law, it has now been held by the Apex Court that, where the Court is able

to find lack of jurisdiction on the face of the materials placed before the

Court, the same can be dealt with under Section 34 of the Act. This is in

view of the fact that jurisdiction of an Arbitral Tribunal goes to the root of

the matter.

https://www.mhc.tn.gov.in/judis ( Uploaded on: 22/01/2026 01:45:02 pm ) Arbitration Original Petition No.82 of 2025

15. The petitioner for the first time is raising the issue of

jurisdiction of the Arbitral Tribunal during oral arguments and the same

has not been specifically raised as a ground in the petition. As stated

supra, the issue of jurisdiction has not been raised before the Arbitral

Tribunal and even assuming on a demurer that the Arbitral Tribunal lacks

jurisdiction under the Master Circular dated 31.07.2023, that is a ground

that has to be raised before the Court, which has the jurisdiction to

entertain a petition under Section 34 of the Act. It is one thing to say that

the Arbitral Tribunal does not have the jurisdiction to entertain the

dispute. However, such a question touching upon the jurisdiction of the

Arbitral Tribunal can only be raised before the Court, which has the

jurisdiction to test the jurisdiction of the Arbitral Tribunal, which

entertained the dispute. Just because, the petitioner is of the opinion that

the award is a nullity, that does not mean that the same can be put to

challenge before any Court across India. Such a ground that has been

raised on the side of the petitioner is unsustainable.

16. The relevant clause in the Master Circular makes it very clear

that the venue and seat of the online proceedings shall be deemed to be

the place, where the investor resides permanently. The records placed

before this Court shows that the 3 rd respondent’s permanent residence is

https://www.mhc.tn.gov.in/judis ( Uploaded on: 22/01/2026 01:45:02 pm ) Arbitration Original Petition No.82 of 2025 in Mumbai. In such an event, the seat of arbitration under the circular

must be taken to be Mumbai and the award can only be challenged before

the High Court of Bombay. This Court will lack the territorial jurisdiction

to test the award passed by the Arbitral Tribunal.

17. The law on this issue is now too well settled and the judgments

that were relied upon by the learned counsel for the 3 rd respondent

squarely covers the issue.

18. In the light of the above discussions, this Court upholds the

jurisdictional issue raised on the side of the 3rd respondent and this Court

holds that in line with Clause 27 of the Master Circular, the seat of

arbitration proceedings would be at Mumbai and therefore, the petition

for setting aside the award can only be filed before the High Court of

Bombay.