The Supreme Court today referred for mediation a long-standing family dispute between industrialist Babasaheb Neelkanth Kalyani and his sister Sugandha Hiremath to former SC judge-Justice L Nageswara Rao.

A bench of CJI Surya Kant, Justice Joymalya Bagchi and Justice V Mohana requested Justice Rao to take up the matter, to explore the possibility of an amicable settlement between the parties, after hearing Senior Advocate Shyam Divan (for Sugandha and Jaidev Hiremath) and Senior Advocates Kapil Sibal, Dr Abhishek Manu Singhvi, Mukul Rohatgi and C Aryama Sundaram (for Kalyani side).

The Court further requested the Bombay High Court to defer hearing of an application filed by Baba Kalyani under Order 7 Rule 11 CPC (for rejection of the Hiremath's suit) during the pendency of the mediation process. "Court proceedings must remain in abeyance during mediation", CJI Kant orally said. It was further indicated that if mediation fails, the Order 7 Rule 11 CPC application may be requested to be decided in a timebound manner.

The parties agreed to contact Justice Rao during the course of day, so that the mediation process can commence tomorrow. The matter was directed to be posted after 2 weeks.

Notably, Kalyani side initially pointed out to the Court prior failed mediations between the parties. Divan, for the Hiremaths, contended that consent was not mandatory for mediation.

Acknowledging the contentions, CJI Kant said that sometimes parties can work out their disputes despite initial hiccups. In this regard, he even recalled a case between 2 brothers where long-standing issues (since 1972) were resolved after the parties effectively communicated with each other and one apologized to the other. "This is the magic of mediation", the CJI said.

The CJI also remarked that the High Court order, refusing to direct mediation (as Kalyani side refused to it), was correct on facts and law. However, Court No.1 of the Supreme Court (CJI Court) was requesting the parties to give mediation a try.

The Kalyani side acceded to the request, praying that the process may be made timebound and the Order 7 Rule 11 hearing be allowed to proceed. The bench however declined, noting that it could not ask Justice Rao to conclude mediation within 2 weeks or allow the Court proceedings to go on while the process was underway.

Background

The dispute arises from a family property dispute between industrialist Babasaheb Neelkanth Kalyani and his sister Sugandha Hiremath, who instituted a suit in 2023 before the Bombay High Court seeking specific performance of an alleged family arrangement dated 1994. During the hearing of an application filed by Babasaheb Kalyani under Order VII Rule 11 of the Code of Civil Procedure seeking rejection of the plaint, the High Court explored the possibility of resolving the dispute through mediation in view of the close familial relationship between the parties.

The plaintiffs urged the Court to refer the matter to mediation, contending that even a minimal possibility of settlement justified such a course. Babasaheb Kalyani, however, opposed mediation, pointing out that earlier mediation efforts before the Supreme Court in 2018-19 and the District Court, Pune had failed, and alleging that repeated settlement attempts were only delaying the proceedings.

He also claimed that media reports concerning settlement discussions had caused embarrassment and affected investor confidence.

On 4 May 2026, the High Court declined to refer the parties to mediation. It held that mediation under the Mediation Act, 2023 is voluntary and consensual, and cannot be imposed where one party is unwilling. Noting the failure of previous mediation attempts, the absence of any meaningful settlement proposal and the lack of any realistic possibility of compromise, the Court held that there were no grounds to compel mediation and rejected the plaintiffs' request.

Case Title: SUGANDHA JAI HREMATH ACCOUNTANT v. BABASAHEB NEELKANTH KALYANI, SLP(C) No. 18036/2026