Back
defers to Supreme Court in Waterline Hotels-SIAC arbitrator recusal arbitration dispute
When a Supervisory Court Steps Aside
The has declined to exercise its extraordinary jurisdiction in a dispute stemming from the 's (SIAC) attempts to reconstitute an arbitral tribunal — holding that all consequential issues arising from the recusal of a Supreme Court-appointed arbitrator must be resolved by the Apex Court itself.
Justice Suraj Govindaraj disposed of the writ petition filed by , which had sought to declare SIAC's communication dated 17.04.2026 as "non-est and not binding." The impugned letter had called upon the parties to furnish particulars for the joint nomination of a new Sole Arbitrator following the recusal of the earlier appointee.
From Management Contract to Arbitral Deadlock
The dispute traces its origins to a Hotel Management Agreement between Waterline Hotels and and Clause 18.2 of the agreement mandated arbitration under the SIAC Rules 2016, seated in Bengaluru.
Even the constitution of the tribunal sparked controversy, with the parties disputing whether a sole arbitrator or a three-member panel was required. The matter reached the Supreme Court, which — in Intercontinental Hotels Group (India) Private Limited and Another v. Waterline Hotels Private Limited ((2022) 7 SCC 662) — appointed a former Judge of the as Sole Arbitrator on 25.01.2022.
The arbitration progressed, and the learned Sole Arbitrator submitted a draft award on 11.12.2024. What followed was a prolonged exchange: the furnished comments, the Arbitrator submitted a revised draft, and the Secretariat found the revisions inadequate. This cycle continued until 29.12.2025, when the Secretariat concluded that the award was "not suitable for finalisation and issuance to the parties" and initiated proceedings for the Arbitrator's removal. The Arbitrator thereafter recused himself through a letter dated 01.04.2026 addressed to the Secretary General of the .
Challenging the Institutional Process
, counsel for the petitioner, advanced a multi-pronged challenge. He argued that the had exceeded its mandate by offering substantive comments on the draft award — matters which, he contended, fell exclusively within the Arbitrator's adjudicatory domain. The Secretariat's role, he insisted, should be confined to procedural observations.
The petitioner further alleged institutional bias, pointing out that counsel appearing for the respondents before the Arbitrator was simultaneously a member of the . The prolonged proceedings — commenced in January 2022 and still unresolved — coupled with substantial arbitration costs, compounded the petitioner's grievance.
The Jurisdictional Red Line
The pivotal question was whether the could entertain a challenge to institutional actions affecting a tribunal constituted by the Supreme Court itself.
The Court held it could not. "Once the appointment of the Tribunal has been made by the Hon'ble Supreme Court, any supervening event affecting the constitution of the Tribunal, including the recusal, withdrawal or substitution of the Arbitrator, necessarily falls within the domain of the Hon'ble Supreme Court that originally constituted the Tribunal," Justice Govindaraj observed.
The Court also addressed the scope of the Apex Court's earlier order dated 08.05.2026 in Miscellaneous Application No.1485/2026, which had merely recorded the recusal and disposed of the application. Notably, that order neither examined the legality of the 's actions nor foreclosed the parties' right to seek consequential directions.
Judicial Discipline and the Path Forward
"Judicial discipline requires that such issues be placed before the Hon'ble Supreme Court, which appointed the Arbitrator and which alone is competent to issue appropriate consequential directions," the Court stated.
Emphasising that the Supreme Court "retains seisin over the appointment of the Tribunal," the High Court concluded that the Apex Court was best positioned to determine whether a substitute arbitrator should be appointed, whether the proceedings should continue under SIAC, or whether any other directions were warranted.
Key Observations
- "Once the appointment of the Tribunal has been made by the Hon'ble Supreme Court, any supervening event affecting the constitution of the Tribunal, including the recusal, withdrawal or substitution of the Arbitrator, necessarily falls within the domain of the Hon'ble Supreme Court that originally constituted the Tribunal."
- "Since the Hon'ble Supreme Court retains seisin over the appointment of the Tribunal, it would be in the best position to determine whether a substitute Arbitrator should be appointed, whether the arbitral proceedings should continue before SIAC, or whether any other directions are warranted in the peculiar facts of the case."
- "Having regard to the fact that the arbitral tribunal was constituted by an order of the Hon'ble Supreme Court under , all consequential issues arising from the cessation of the mandate of the learned Arbitrator must necessarily be agitated before the Hon'ble Supreme Court itself."
What This Means Going Forward
The writ petition was disposed of with liberty reserved to the petitioner to approach the Supreme Court raising all contentions available in law, including those urged in the present petition. The judgment clarifies a critical jurisdictional boundary in arbitration law: when a tribunal's constitution flows from a judicial order of the Supreme Court under , High Courts cannot intervene in consequential institutional disputes — the Apex Court alone retains competence to issue directions affecting the reconstitution or continuation of such tribunals. The ruling underscores that institutional challenges, however serious, must follow the jurisdictional hierarchy established by the Act.
