The Delhi High Court has dismissed Lalit Modi’s challenge to an arbitral award concerning a property dispute with BDR Builders and Developers Pvt. Ltd., holding that no legal ground had been established to set aside the award.
Justice Harish Vaidyanathan Shankar, in a judgment pronounced on August 18, 2026, also allowed the connected execution proceedings to continue for enforcement of the award dated November 21, 2016.
Background of the Case
The dispute arose from an Agreement to Sell dated June 24, 2014 concerning a freehold built-up property measuring about 858 square yards at 32, Paschimi Marg, Vasant Vihar, New Delhi. After disputes arose, both sides jointly approached advocate Naresh Gupta on October 5, 2016, requesting him to act as the sole arbitrator.
The arbitral proceedings began in October 2016. On November 14, the parties informed the arbitrator that they had amicably settled their disputes. Their statements were recorded and signed by both sides.
The settlement included specific terms relating to the property, including adjustment of the balance sale consideration and delivery of possession. The arbitrator thereafter passed an award on November 21, 2016 incorporating the agreed terms.
On the same day, both parties also signed an “Acceptance” recording that they accepted the award in full and would not challenge it. The award was subsequently engrossed on stamp paper on January 12, 2017 for registration.
Challenge Before the High Court
Lalit Modi challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996. His case included objections concerning the arbitrator’s independence, alleged non-disclosure of his earlier professional association with BDR Builders, and the manner in which the award was later engrossed on stamp paper.
The respondent argued that the November 21 award was a consent award and had already been voluntarily accepted by both parties.
The High Court rejected the preliminary argument that a consent award could never be challenged under Section 34. It held that the court could examine whether the settlement was lawful, whether consent was properly obtained and whether any statutory ground for interference was made out.
Court’s Observation On The Engrossed Award
The Court examined the subsequent engrossment of the award on stamp paper. It noted that the award had already been pronounced and accepted by both parties on November 21, 2016.
The Court observed:
“The subsequent engrossment neither altered nor modified any of the substantive terms embodied in the award, nor did it amount to the making of a fresh or substituted award.”
According to the Court, the later steps were administrative in nature and were undertaken after both parties had requested registration of the award. The Court therefore held that they did not affect the validity or finality of the original award.
Arbitrator’s Disclosure And Independence
The Court also considered the allegation that the arbitrator had failed to make the disclosure required under Section 12 of the Arbitration Act.
Justice Shankar explained that while disclosure is mandatory, every instance of non-disclosure does not automatically invalidate an arbitration. The relevant question is whether the underlying circumstance creates justifiable doubts about the arbitrator’s independence or falls within the statutory disqualifications under the Seventh Schedule.
The Court found that the professional engagements relied upon by Modi related to the period from 2008 to 2012, whereas the arbitration commenced in 2016. It held that these circumstances did not establish the statutory disqualification or the required doubts about impartiality.
The Court also declined to rely upon a typed copy of an alleged 2018 communication attributed to the arbitrator, observing that its original, authorship and authenticity had not been established.
Decision
The High Court concluded that Modi had failed to establish any ground for interference with the arbitral award under Section 34.
The Court held:
“Accordingly, the present Objection Petition is dismissed.”
It further directed that the execution petition filed by BDR Builders and Developers Pvt. Ltd. would proceed in accordance with law for enforcement and execution of the November 21, 2016 arbitral award.
The matter was listed before the Roster Bench on October 28, 2026 for further proceedings.
Case Details:
Case Title: Lalit Modi v. BDR Builders and Developers Private Limited
Case Number: O.M.P. 7/2017 & connected matter; EX.P. 69/2017
Judge: Justice Harish Vaidyanathan Shankar
Decision Date: August 18, 2026
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