Kirloskar Family Feud: Supreme Court Advises Mediation To Resolve Dispute

Supreme Court of India
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New Delhi, 27 July 2021: The Supreme Court today ordered status quo in a family dispute of Kirloskar brothers related to the property.


Sanjay Kirloskar, the promoter of the Kirloskar Brothers Ltd (KBL), a pump manufacturing company, had challenged a Bombay High Court order in the apex court. The HC had ordered arbitration to solve his dispute with his brothers, Atul (CMD of Kirloskar Engine Oils Ltd) and Rahul (CMD of Kirloskar Pneumatic Company Ltd).


The status quo order passed by the apex court would also apply to a trial in the matter pending in a lower civil court in Pune.


A bench of Chief Justice NV Ramana and Justice Surya Kant asked the parties involved in the matter to explore the possibility of mediation on the appeal of Sanjay Kirloskar and issued notice to them to file their reply within six weeks.


“Both of us (the judge) feel that this (Kirloskar) is one of the reputed families and companies. We feel that it is in the interest of the company to resolve the issues through arbitration.”


The bench further said, “You are familiar with litigation in civil courts. I don’t want to comment on the arrangement. All the lawyers can sit together and figure out a way and if you want some outside help we can appoint some retired judges. Why do you want to fight this case unnecessarily? You may have alternative solutions. There will be some common family friends, and they can mediate.”


There is a dispute between the Kirloskar brothers – Sanjay, Atul and Rahul over the distribution of property under a family agreement (Deed of family settlement) in 2009.


According to KBL, DFS has a clause stating that the brother will not compete but this has been violated by Rahul and Atul who have taken a stake in a pump manufacturing company.


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 which had ordered resolution through Arbitration as per the terms of the DFS.


This order has now been challenged by Sanjay Kirloskar in the Supreme Court on the ground that only disputes relating to Kirloskar Institute of Advanced Management Studies (KIAMS) and Kirloskar Foundation (KF) shall be referred for arbitration and no other disputes would be entertained by the arbitrators.