Delhi High Court Slaps ₹1 Lakh Cost On Litigant For 'Calculated Attempt' To Delay Arbitral Award Execution

The Delhi High Court has imposed Rs 1 lakh in costs on a litigant for what it called a “calculated attempt” to stall enforcement of a decade-old arbitral award.

Justice Harish Vaidyanathan Shankar dismissed the objection application, holding that repeated attempts to delay execution, as in the present case, cannot be justified as an exercise of legal rights.

The court underscored that the award, passed on December 31, 2014, had already attained finality.

“The approach adopted by the Objector reflects a calculated attempt to obstruct and delay the enforcement of a decree which has already been conclusively adjudicated and is legally binding. Such conduct, if condoned, undermines the efficacy of judicial processes and the faith of litigants in the rule of law,” the bench said.

The dispute traces back to a 2010 Memorandum of Understanding between Avneet Soni and Kavita Agarwal for the sale of a Hauz Khas Enclave property. The transaction did not go through. Payments were repeatedly delayed. Cheques issued towards repayment were dishonored and subsequently, arbitration was invoked.

A sole arbitrator awarded Soni about Rs 4.80 crore plus interest. Agarwal challenged the award under Sections 34 and 37 of the Arbitration Act. Both challenges failed. Her special leave petition before the Supreme Court of India was also dismissed. Execution began in 2015.

Agarwal later filed objections in execution, arguing that a decree passed without inherent jurisdiction is void and can be challenged “at any time”. She relied on the claim that unilateral appointment of the arbitrator made the award non est.

Soni responded that the objection was a “gross abuse of the process of law.” He pointed out that the 2015 amendments restricting unilateral appointments apply prospectively and cannot affect a 2014 award. He also noted that Agarwal had filed similar objections in 2019 and withdrawn them unconditionally.

The court agreed that the law on unilateral appointments changed only after October 23, 2015. It reaffirmed that the objection had been raised repeatedly, first before the arbitrator, then under Section 34, under Section 37, and then before the Supreme Court and rejected each time.

“Repeated invocation of the same ground, more than ten years after the filing of the Execution Petition and over eleven years after the Award was rendered, cannot be regarded as a genuine or bona fide exercise of legal rights. Rather, it reflects a deliberate attempt to obstruct the enforcement of a valid and binding arbitral award, thereby clogging the machinery of justice,” the Court held.

Finding the objections meritless and contrary to fair play, the court dismissed them. It directed Agarwal to pay Rs 50 thousand to the decree holder and Rs 50 thousand to the Delhi High Court Bar Association within two weeks.

For Decree Holder: Senior Advocate Pawanjit Singh Bindra with Advocates Kirtiman Singh, Madhu Sudan, Vikhyat Oberoi, Ankit Kakkar, Ravi Sharma, Nishita Gupta, Shivam Prakash, Shreya V. Mehra, Fazal Haroon, Deepti Mehra and Maulik

For Judgment Debtor: Senior Advocate Arvind Nigam with Advocates Raghuveer Kapur and Sagar Aggarwal