Composite mortgage enforcement claims are non-arbitrable, and a court cannot split parties or reliefs for partial reference.

A composite suit seeking specific performance of an agreement to create a mortgage and enforcement of the mortgage is not referable to arbitration under Section 8 of the Arbitration and Conciliation Act, 1996, because enforcement of the mortgage affects rights in rem and is for judicial determination. Although specific performance of a contract to execute a mortgage is recognised under the Specific Relief Act, the suit's broader reliefs take it outside arbitration. The dispute also could not be bifurcated for partial reference, as the arbitration clause covered only the loan and services agreements, while the personal guarantee agreement contained no arbitration clause and the guarantor was not shown to be bound by any arbitration agreement.

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Issues: (i) Whether a suit seeking specific performance of an agreement to create a mortgage and enforcement of the mortgage is referable to arbitration under Section 8 of the Arbitration and Conciliation Act, 1996. (ii) Whether the suit and the parties could be bifurcated for reference to arbitration when one defendant was not party to any arbitration agreement.

Issue (i): Whether a suit seeking specific performance of an agreement to create a mortgage and enforcement of the mortgage is referable to arbitration under Section 8 of the Arbitration and Conciliation Act, 1996.

Analysis: The relief claimed was not confined to a bare agreement to mortgage. The suit was composite in nature and included enforcement of the mortgage, which affects rights in rem and would bind third parties. Section 14(3)(a)(i) of the Specific Relief Act permits specific performance of a contract to execute a mortgage, but the consequential enforcement of the mortgage is a matter for adjudication by a court of law. A claim that includes enforcement of a mortgage is therefore not arbitrable.

Conclusion: The issue was answered against arbitration and in favour of the Respondent.

Issue (ii): Whether the suit and the parties could be bifurcated for reference to arbitration when one defendant was not party to any arbitration agreement.

Analysis: The arbitration clause existed only in relation to the loan and services agreements. The personal guarantee agreement did not contain an arbitration clause, and the guarantor was not shown to be a party to the arbitration agreement. The subject matter of the suit and the parties could not be split, because Section 8 does not permit partial reference of a composite dispute or bifurcation between parties covered and not covered by an arbitration agreement. The presence of a non-signatory defendant reinforced the bar against reference.

Conclusion: The issue was answered against bifurcation and in favour of the Respondent.

Final Conclusion: The chamber summons seeking reference of the suit to arbitration was not maintainable, as the dispute included non-arbitrable reliefs and could not be split for piecemeal reference.

Ratio Decidendi: A composite suit that includes enforcement of a mortgage, being an action in rem, cannot be referred to arbitration under Section 8, and a court cannot bifurcate the subject matter or parties where the dispute includes claims outside the arbitration agreement.

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