The Lakshmi Mills Company Limited, a Coimbatore-based textile company, has moved the Supreme Court of India to seek arbitration in an ongoing commercial dispute. The company has filed a Writ Petition (Online No. ECSCIN01064882025, Diary No. 8575/2025) before the Supreme Court, requesting the appointment of a sole Arbitrator to adjudicate issues arising from the Power Consumption Agreement dated October 12, 2022.

The dispute involves Vishnupriya Farms Private Ltd and two other parties, with whom Lakshmi Mills had entered into multiple agreements, including the Shareholders Agreement and Share Purchase Agreement, both dated October 12, 2022. Following the cancellation of these agreements, disputes emerged between the parties, leading Lakshmi Mills to invoke arbitration as per Clause 16 of the Shareholder’s Agreement, Clause 21 of the Power Consumption Agreement, and Clause 13 of the Share Purchase Agreement, read in conjunction with Clause 21.1 of the Power Consumption Agreement.

The company has approached the Supreme Court under the Arbitration and Conciliation Act, seeking legal recourse to resolve the commercial dispute and appoint an Arbitrator for international commercial arbitration, seated in New Delhi.

Legal and Financial Implications

While the exact financial implications and quantum of claims remain undetermined, the company anticipates that the appointment of an Arbitrator and subsequent arbitration proceedings will provide clarity on potential compensation and penalties. The dispute has raised concerns regarding the impact on the company’s financial position, but a structured arbitration process is expected to address and resolve these uncertainties.

The Lakshmi Mills Company Limited has assured stakeholders that it remains committed to adhering to legal and regulatory requirements, including SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company has disclosed the pending litigation as per the prescribed guidelines outlined in SEBI circular SEBI/HO/CFD/CFD-PoD-1/P/CIR/2023/123, dated July 13, 2023.

The case will be closely watched as Lakshmi Mills seeks to protect its business interests and ensure a fair resolution of the dispute. The outcome of the Supreme Court’s decision on arbitration could set a precedent for similar commercial disputes in the corporate sector.

The company has made the official disclosure available on its website, ensuring transparency and compliance with regulatory norms. Stakeholders and investors are advised to stay updated on further developments as the case progresses in the Supreme Court of India.

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