Back
2026 Supreme(Del) 861
IN THE HIGH COURT OF DELHI AT NEW DELHI
V. Kameswar Rao, Manmeet Pritam Singh Arora, JJ.
OYO Hotels And Homes Pvt. Ltd. - Appellant
Versus
Shri Amit Samanta - Respondent
FAO (COMM) 242 of 2023 CM APPL. 61277 of 2023
Decided On : 13-05-2026
For the Appellant :Mr. Nikilesh Ramachandran, Mr. Sagar Kumar Pradhan, Mr. Diptiman Aacharya, Mr. Samarth Mehrotra and Mr. Kartik Yadav, Advocates
For the Respondent:Mr. Neil Wadia, Mr. Narayan Wadia, Ms. Jyoti Saini, Ms. Tanvi Munjal and Mr. Piyush Wadia, Advocates
A party waives its right to request arbitration under the Act if it submits to the court's jurisdiction by filing a response on the substance of the dispute before seeking a reference. Failure to invoke arbitration at the earliest opportunity signifies an intention to litigate in court.
Headnote:(A) Arbitration and Conciliation Act, 1996 - Section 8 - Reference to arbitration - Waiver of right - If a party files its first statement on the substance of the dispute without seeking reference to arbitration, it is presumed that the party has waived its right to invoke the arbitration clause - Once a party submits itself to the jurisdiction of a judicial authority by addressing the merits of the controversy, it cannot later revert by citing the existence of an arbitration agreement (Paras 4, 7, 8, 9).
(B) Arbitration and Conciliation Act, 1996 - Section 8 - Procedural requirement - Application for reference must be accompanied by the agreement - Mere mention of an internal agreement without disclosure of the arbitration clause or failure to act at the earliest opportunity signifies acquiescence to court proceedings (Paras 3, 7, 10).
Facts of the case:
The appellant challenged a trial court order dismissing its application to refer a dispute to arbitration. The appellant had previously filed a written statement in the case but failed to raise the arbitration clause at that time. The respondent had replied by filing a replication, and issues had been framed by the court. The appellant argued that the delay was due to the non-possession of the agreement, which the court rejected as insufficient to bypass statutory requirements.
Findings of Court:
The High Court concurred with the trial court that the appellant had submitted to the jurisdiction of the court by failing to invoke arbitration in its initial response to the dispute. The court clarified that the obligation to produce the agreement and move the application lies with the party seeking arbitration, and failure to do so upon filing a statement on the substance of the dispute constitutes a waiver of that right.
Issues: Whether the filing of a written statement on the substance of a dispute without invoking an arbitration agreement constitutes a waiver of the right under the governing statute to refer the matter to arbitration.
Ratio Decidendi: The court held that participation in litigation by filing a response on the merits, without seeking a reference to arbitration at the earliest opportunity, establishes a waiver of the right to arbitrate. Compliance with the procedural requirement of seeking such a reference before or at the time of the first statement on the substance of the dispute is mandatory.
Result: Appeal dismissed.
| Table of Content |
|---|
| 1. procedural context for appeal challenging order dismissing section 8 application. (Para 1 , 2 , 3) |
| 2. waiver of arbitration rights via participation in judicial proceedings. (Para 4) |
| 3. parties' arguments regarding delayed arbitration filings. (Para 5 , 6) |
| 4. strict compliance with section 8 requirements; waiver occurs upon filing defense on substance. (Para 7 , 8 , 9) |
| 5. final outcome: appeal dismissed for lack of merit. (Para 10) |
JUDGMENT :
V. KAMESWAR RAO, J.
1. This appeal challenges the order dated 10.10.2023 by the learned District Judge (Commercial Court)-02, Dwarka Courts, New Delhi, whereby the application filed by the appellant herein under Section 8 of the Arbitration and Conciliation Act, 1996 (‘Act of 1996’) seeking reference of the dispute to arbitration was dismissed.
2. It is not in dispute that pursuant to the summons received by the appellant herein, the appellant had filed written statement to which, replication was also filed by the respondent herein.
3. The learned District Judge noted that the appellant had in the written statement referred to the provisions of the agreement executed between the appellant and the respondent; but without stating the fact that the agreement contains an arbitration clause.
4. In the impugned order, the learned District Judge referring to the judgment of the Supreme Court in Sukanya Holdings Pvt. Ltd vs Jayesh H. Pandya & Anr., AIR 2003 SC 2252 and also the judgment of this Court in the case of Mi2C Security Facilities Pvt Ltd vs North Delhi Municipal Corporation , W.P.(C) 8197/2017, observed that if a party has filed its first statement without any intimation of the arbitration clause before the judicial authority then it would be presumed that the party has waived off its right to invoke the arbitration clause as per Section 8 of the Act of 1996. Relevant part of the order is reproduced as under:-
“3. Perusal of written statement reveals that the defendant had specifically mentioned that plaintiff and defendant had entered into an agreement dated 01.08.2017 and reference was also given to clauses of the said agreement in the written statement. There was no whisper in the entire written statement with regard to said agreement containing arbitration clause nor any such application separately had been moved. Despite the specific mention in the written statement with regard to agreement dated 1.8.2017, same was not even filed alongwith the written statement. Pleadings in the case had already been complete and matter was fixed for framing of issues when the instant application was moved. In these circumstances, since the defendant at the first instance had not invoked for reference of the matter to arbitration, defendant deemed to have waived off its right to invoke arbitration clause.
4. Hon’ble Apex Court in Sukanya Holdings Pvt. Ltd vs Jayesh H. Pandya & Anr, observed that section 8 is essentially an acknowledgment of the fact that parties can waive an arbitration agreement. Conditions under section 8 are meant to provide for reading such waiver by conduct. When a suit is filed despite an arbitration agreement, it is an offer by one party to terminate this agreement. If the other party joins the suit by contesting it on substance, it accepts such offer and the arbitration agreement comes to an end. Section 8 provides that failure to invoke the arbitration agreement within reasonable time shall also be deemed to be an acceptance.
5. In Mi2C Security Facilities Pvt Ltd vs North Delhi Municipal, W.P.(C) 8197/2017 & CM. No. 33688/2017, it was observed by Hon’ble High Court of Delhi that if the party has filed its first statement without any intimation of the arbitration clause before the judicial authority, then it would be presumed that the party has waived off its right to invoke the arbitration clause as per section 8 of the Arbitration and Conciliation Act.
6. Application u/s 8 of Arbitration and Conciliation Act, in these circumstances, stands dismissed.
7. From the plea
