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2026 Supreme(Online)(Del) 13914
IN THE HIGH COURT OF DELHI AT NEW DELHI
Harish Vaidyanathan Shankar, J
CYGNETT HOTELS AND RESOTS PRIVATE LIMITED – Appellant
Versus
M/S TAPOBHUMI ECO PROJECTS PRIVATE LIMITED – Respondent
ARB.P. 1001/2026 | CAV 272/2026 | I.A. 15726/2026 (EX.) | O.M.P.(I) (COMM.) 237/2026 | I.A. 15660/2026 (EX.)
For the Appellants/Petitioners: Gurmeet Singh, Abhishek Arora
For the Respondents: Supantha Sinha
The jurisdiction of a referral court under Section 11 of the Arbitration and Conciliation Act, 1996, is limited to a prima facie examination of the existence of a valid arbitration agreement, without delving into the merits or contested facts of the dispute.
Headnote:The petition was filed under Section 11(6) of the Arbitration and Conciliation Act, 1996, seeking the appointment of a Sole Arbitrator to resolve disputes arising from a Hotel Management Agreement dated 28.08.2024. The court noted that Clause 13 of the agreement provided for arbitration in New Delhi. Upon the respondent's consent in court, the court found that the statutory mandates for the appointment of an arbitrator were satisfied. The primary issue concerned the scope of judicial scrutiny under Section 11(6) of the Act. Relying on the Supreme Court's decision in SBI General Insurance Co. Ltd. v. Krish Spinning, the court held that the referral court's jurisdiction is "extremely circumscribed" and limited to a "prima facie examination of the existence of a valid Arbitration Agreement and nothing beyond," as detailed adjudication of facts or law is reserved for the Arbitral Tribunal. Accordingly, the present Petition, along with pending Application(s), if any, stands disposed of in the above terms.
| Table of Content |
|---|
| 1. request for appointment of arbitrator based on a valid agreement. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7) |
| 2. judicial scrutiny under section 11 is limited to the prima facie existence of the arbitration agreement. (Para 8 , 9 , 10) |
| 3. appointment of a sole arbitrator and procedural directions for the reference. (Para 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19) |
| 4. conversion of section 9 interim relief petition into a section 17 application before the appointed tribunal. (Para 20 , 21 , 22 , 23 , 24 , 25 , 26) |
JUDGEMENT (ORAL)
ARB.P. 1001/2026
1. The present Petition has been filed under Section 11(6) of the Arbitration and Conciliation Act, 1996, seeking the appointment of a Sole Arbitrator to adjudicate upon the disputes inter se the parties arising out of the Hotel Management Agreement dated 28.08.2024.
2. Material on record indicates that the said Agreement envisages a Dispute Resolution Clause being Clause 13, which reads as under:
“13. DISPUTE RESOLUTION
13.1 All disputes and differences arising out of or in connection with any of the matters set out in this Agreement including the breach, termination, or invalidity thereof (“Dispute”), the Parties shall use all reasonable endeavors to negotiate with a view to resolving the Dispute amicably.
13.2 If a Party gives the other Party a notice that a Dispute has arisen (a “Dispute Notice”) and the Parties are unable to resolve the Dispute amicably within 15 (Fifteen) days of service of the Dispute Notice (or such longer period as the Parties may mutually agree in writing), then the Dispute shall be referred to arbitration conducted as per the provisions of the Arbitration and Conciliation Act 1996 for the time being in force.
13.3 The venue/seat of the arbitration proceedings shall be “New Delhi” and all proceedings in the arbitration shall be conducted in English.
13.4 There shall be a sole arbitrator who shall be mutually appointed by the Parties to the Dispute. In the event that the Parties fail to agree on a sole arbitrator within 15 (fifteen) days of the Dispute Notice, the Parties will appoint an arbitrator in accordance with the provisions of the Arbitration and Conciliation Act 1996 for the time being in force. Any arbitral award shall be final and binding on the Parties. The Parties agree that the arbitration proceedings shall be kept confidential.
13.5 The Parties further agree that the arbitrator shall also have the power to decide on the costs and reasonable expenses (including reasonable fees of its counsel) incurred in the arbitration and award interest up to the date of the payment of the award. Each Party shall bear its own costs in relation to the arbitration proceedings unless otherwise determined by the arbitration award.”
3. Material on record further indicates that the Notice under Section 21 of the Act was issued on 06.05.2026; the Respondent, vide its Reply dated 10.05.2026, refused consent thereto.
4. Issue Notice.
5. Learned counsel, Mr. Supantha Sinha, enters appearance on behalf of the Respondent and accepts service.
6. Learned counsel for the Respondent, on instructions, submits that the Respondent has no objection to the present disputes being referred to arbitration.
7. Learned counsel appearing on behalf of the parties also submit that they shall try to, before the formal commencement of the arbitration process, attempt to settle the dispute amongst themselves.
8. At this juncture, it would also be apposite to note that the legal position governing the scope and extent of judicial scrutiny under Section 11(6) of the Act is no longer res integra. A three-Judge Bench of the Hon’ble Supreme Court in SBI General Insurance Co. Ltd. v. Krish Spinning , (2024) 12 SCC 1, after taking into consideration the authoritative pronouncement of the seven-Judge Bench in Interplay Between Arbitration Agreements under Arbitration Act, 1996 & Stamp Act, 1899, In re, comprehensively delineated the contours
