Delhi High Court Directs Court Hearing Award Challenge To Decide Vipsie's Perjury Plea Within 3 Months

The Delhi High Court on 16 September directed the court which heard Vipsie Hospitalitys Pvt. Ltd.'s challenge to an arbitral award to decide its application seeking perjury proceedings over allegedly forged documents within three months.

Justice Manmeet Pritam Singh Arora held that Vipsie had correctly filed the Section 340 Cr.P.C. application before the court hearing its Section 34 petition against the arbitral award in its dispute with Walianet. The Court also settled that court's jurisdiction to hear the application. The Bench observed:

“In the considered opinion of this Court, the liberty granted to the Petitioner to seek initiation of appropriate proceedings for perjury against the authorized representative of the Respondent, post conclusion of the arbitration proceedings, have been correctly initiated, by the Petitioner, by filing Section 340 Cr.P.C. application before the Court hearing Section 34 petition under the Act of 1996 i.e., in OMP(COMM) 24/2023.”

The dispute arose in 2019 when Walianet approached the court under Section 9 of the Arbitration Act seeking interim protection.

Relying on letters dated 18 December 2018 and 15 January 2019, Walianet obtained an ad-interim order on 12 February 2019 restraining Vipsie from creating any third-party interest in premises at M-25, M Block Market, Greater Kailash-I, New Delhi.

Vipsie alleged that both letters were forged and fabricated. On 23 February 2019, it sought initiation of proceedings under Section 340 Cr.P.C. against Walianet for filing and relying on the documents.

Section 340 Cr.P.C. provides the procedure for initiating proceedings where a court considers that an offence concerning false evidence, fabrication or documents produced before it may have been committed. The parties were referred to arbitration on 14 October 2019.

On 15 November 2019, the court deferred the perjury proceedings, holding that the arbitral tribunal should first determine the authenticity of the disputed letters. Vipsie challenged the order, but the High Court on 10 June 2020 upheld the approach and held that the allegations of forgery would have to be assessed at trial.

The arbitral tribunal delivered its final award on 18 June 2022 and found the authenticity and genuineness of the disputed letters to be “highly doubtful and suspect”. It nevertheless granted monetary relief to Walianet. Vipsie thereafter approached the High Court by way of a writ petition challenging the award.

On 1 March 2023, the Court directed Vipsie to pursue its remedy under Section 34 of the Arbitration Act. It also left Vipsie at liberty to seek appropriate proceedings based on the tribunal's findings concerning the disputed documents.

Vipsie accordingly filed a Section 34 petition challenging the award and, on 18 March 2023, moved a fresh Section 340 Cr.P.C. application seeking proceedings against Walianet's partner and authorised representative.

The Section 34 challenge was dismissed as time-barred on 8 July 2023, but the perjury application remained undecided despite arguments having been heard. Aggrieved by the non-adjudication of its application, Vipsie approached the High Court.

The High Court initially directed the concerned trial court to hear and decide the application. A dispute subsequently arose over whether the application should instead be heard by the successor court dealing with the earlier Section 9 proceedings, since the disputed documents had originally been filed before that court.

Walianet submitted that, under Section 42 of the Arbitration Act, the court which heard the Section 34 challenge had jurisdiction to decide the perjury application. It, however, reserved its right to oppose the relief sought by Vipsie on merits.

Accordingly, the High Court directed the court which heard Vipsie's Section 34 challenge to adjudicate the Section 340 Cr.P.C. application on merits within three months. It left Walianet free to challenge the maintainability of the relief sought in the perjury application, including on the basis of the Supreme Court's decision in Iqbal Singh Marwah v. Meenakshi Marwah.

However, it conclusively settled the question of jurisdiction and directed that neither party could raise any further dispute over the forum. It directed the parties to appear before the trial court on 30 September 2026 without requiring any further notice of hearing.

Appearances for petitioner (Vipsie Hospitalitys Pvt. Ltd.): Advocates M. Sufian Siddiqui, Rakesh B., Niyazudin and Mazhar Ahmed.

Appearances for respondent (Walianet): Senior Advocate Hrishikesh Baruah with Advocates Gaurav Vig, Shubham Agarwal and Pratham Pandey.