MERCEDES BENZ FINANCIAL SERVICES INDIA PRIVATE LIM vs Ms KAMCO CHEW FOOD PRIVATE LIMITED
- Court
- Madras High Court
Arb OP (Com.Div) No.508 of 2026
IN THE HIGH COURT OF JUDICATURE AT MADRAS
RESERVED ON : 30.10.2026
DELIVERED ON : 04.11.2026
CORAM :
THE HONOURABLE MR. SUSHRUT ARVIND DHARMADHIKARI,
CHIEF JUSTICE
Arb O.P(COM.DIV.) No. 508 of 2026
HCMA011676572026
CNR:{ }
Mercedes-Benz Financial Services India
Private Limited, 5th Floor, Plot 8,
Baashyam Willow Square 9 and 10,
First Street, Thiru Vi Ka Industrial Estate,
Guindy, Chennai-600032.
Rep.by its Authorised Signatory
Petitioner(s)
Vs
1. Kamco Chew Food Private Limited
47, S.K.Compound, Lasudia Mori,
Dewas Naka, Indore,
Madhya Pradesh-452010.
2. Kartar Singh
S/o.Mool Chand,
B-220, Gulmohar Compled,
Scheme No-136, Indore,
Madhya Pradesh - 452012.
Respondent(s)
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Arb OP (Com.Div) No.508 of 2026
PRAYER: Petition filed under Section 11(6) of the Arbitration and
Conciliation Act, 1996 to appoint a Sole Arbitrator to adjudicate the
dispute between the petitioner and the respondents as per the Loan
Agreement dated 17.08.2023 bearing Contract No.10157356, direct
the respondents to pay the cost of this petition.
For Petitioner(s): Mr.D.Pradeep Kumar
For Respondent(s):No Appearance
ORDER
This petition is filed under Section 11(6) of the Arbitration and
Conciliation Act, 1996 ("the Act") seeking the appointment of a Sole
Arbitrator to resolve the commercial disputes between the parties
under the Loan Agreement dated 17.08.2023 (Contract
No.10157356).
2.1. The facts in a nutshell are that the petitioner, a registered
Non-Banking Financial Company (NBFC), extended a credit facility
of Rs.1,55,00,000/- to Respondent No.1 (Borrower) and
Respondent No.2 (Co-Borrower) to purchase a Mercedes-Benz EQS
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Arb OP (Com.Div) No.508 of 2026
580 4MATIC vehicle (Engine No.78060010032880, Chassis
No.W1K2971446L000137, Registration No. MP09ZS0097).
2.2. The parties executed the Loan Agreement and Deed of
Hypothecation on 17.08.2023. The loan was repayable in 48
monthly installments totaling Rs.1,87,91,687/-. The respondents
defaulted on their repayment schedule. Consequently, the petitioner
issued a Loan Recall Notice on 29.12.2025, terminating the
agreement and demanding immediate payment of the total
outstanding dues of Rs.1,20,82,646.56 as of 22.12.2025.
2.3. The respondents failed to pay the demanded amount. The
petitioner then issued a notice under Section 21 of the Act on
18.05.2026, invoking the arbitration clause and nominating a sole
arbitrator. Despite receiving the notice, the respondents did not
reply or concur with the proposed nomination.
3. Court notices issued in this petition were duly served on
both respondents. Despite service of notice, the respondents failed
to enter an appearance through counsel or in person, and no
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Arb OP (Com.Div) No.508 of 2026
counter-affidavit was filed to contest the averments. The matter is
thus proceeded ex-parte against the respondents.
4. Clause 76 of the Loan Agreement dated 17.08.2023
contains an explicit arbitration clause providing for reference of all
claims and disputes to a sole arbitrator, with the venue exclusively
designated at Chennai. The petitioner fulfilled the mandatory
procedural requirement by serving notice under Section 21 of the
Act on 18.05.2026. In the absence of any defence or objection from
the respondents, the existence of a valid arbitration agreement and
the arbitrability of the dispute stand established.
5. In view of the valid arbitration clause, the existence of
arbitrable commercial disputes, and the failure of the respondents
to respond or enter an appearance, this Court finds it appropriate to
allow the petition and appoint an independent sole arbitrator.
6. The petition is allowed with the following directions:
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Arb OP (Com.Div) No.508 of 2026
(a) Hon'ble Mr.Justice R.Balasubramanian,
Former Judge of the Madras High Court , residing
at No.6/29, Flat No.1B, Vishwanath Apartments, 5th
Main Road, R.A.Puram, Chennai - 600 028, is
appointed as the Sole Arbitrator to enter upon
reference and adjudicate the disputes between the
parties arising out of the Loan Agreement dated
17.08.2023.
(b) The learned Sole Arbitrator shall file the disclosure
declaration in terms of Section 12 of the Act prior to
entering upon the reference.
(c) The seat and venue of the arbitration proceedings
shall be Chennai.
(d) The arbitration proceedings shall be conducted
under the aegis of the Madras High Court Arbitration
Centre in accordance with the Madras High Court
Arbitration Proceedings Rules, 2017. The arbitral fee
and administrative costs shall be fixed as per the
Madras High Court Arbitration Centre Rules and shall
be payable as directed by the Arbitrator.
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Arb OP (Com.Div) No.508 of 2026
(e) All contentions, claims, counter-claims, and
defenses on merits are left open for determination by
the learned Sole Arbitrator.
There shall be no order as to costs.
(SUSHRUT ARVIND DHARMADHIKARI,CJ)
04.11.2026
Index : Yes/No
Neutral Citation : Yes/No
sasi
To
The Assistant Registrar,
Madras High Court Arbitration Centre,
Chennai-600 104.
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Arb OP (Com.Div) No.508 of 2026
THE HON'BLE CHIEF JUSTICE
(sasi)
Arb O.P(COM.DIV.) No.508 of 2026
04.11.2026
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