This order does not decide whether the arrears of ₹51,69,376 are due, whether the termination of the licence was valid, or who is ultimately entitled to the deposited amount. All rights and contentions, including arbitrability and preliminary objections, are left open for the arbitrator.
- Case
- M/s Light Lake Enterprises Pvt. Ltd. and Another v. M/s Aria Hotels and Consultancy Services Pvt. Ltd.
- Court
- High Court of Delhi
- Decision
- Citation
- 2026:DHC:9882
- Bench
- Manoj Jain
- Judgment by
- Manoj Jain
- Case numbers
- O.M.P.(I) (COMM.) 492/2026
- Outcome
- Section 9 petition under the Arbitration and Conciliation Act, 1996 disposed of by consent: disputes referred to arbitration, sole arbitrator appointed, arrears deposited with the Registry, and the petition treated as a Section 17 application before the arbitrator.
Arbitration, an arbitrator, and a deposit in the meantime
The Delhi High Court has referred the disputes between Light Lake Enterprises and Aria Hotels and Consultancy Services to arbitration and appointed Justice Chander Shekhar, a former judge of the Court, as sole arbitrator. Justice Manoj Jain disposed of the petition under Section 9 of the Arbitration and Conciliation Act, 1996 by consent on 4 November 2026.
The petitioners undertook to deposit ₹51,69,376 with the Registry within four weeks; the amount is to be kept in an interest-bearing fixed deposit and released to the rightful claimant as the sole arbitrator directs at the appropriate stage. The petition was also treated as an application under Section 17 of the Act, for the arbitrator to decide as expeditiously as possible.
A bar and discotheque space inside JW Marriott, Aerocity
The respondent had developed a five-star hotel under the name JW Marriott Hotel at Aerocity, New Delhi. Under a sub-licence agreement dated 7 February 2024, it granted the first petitioner a commercial space of 2,005 sq. ft. on the ground floor of the hotel for business activities described as a high-energy bar and discotheque space. The agreement provided for a lock-in period and renewal of the licence.
A second agreement dated 31 May 2024 licensed a further 200 sq. ft. on the ground floor of the same premises. The petitioners' case was that the two premises together constituted a single functionary integrated commercial unit. A third agreement dated 1 May 2025, between the second petitioner and the respondent, concerned the same 2,005 sq. ft. space. The licence agreement for the 2,005 sq. ft. space was terminated by the respondent on 21 September 2026, and the dispute before the Court concerned restriction of access to the 200 sq. ft. area from which the petitioner said it was running kitchen activities.
Three agreements, one arbitration clause
The 7 February 2024 agreement contained an arbitration clause requiring the parties to attempt an amicable settlement within 60 days of notice of a dispute, and, failing that, to refer the dispute to a tribunal of three arbitrators under the Arbitration and Conciliation Act, 1996, with New Delhi as the venue and English as the language. The courts at New Delhi were given exclusive jurisdiction. The 1 May 2025 agreement contained materially similar arbitration and jurisdiction clauses.
The arguments were heard at length on 3 November 2026 as well. Counsel for the respondent stated on instructions, and without prejudice to the respondent's rights and contentions, that in view of the claims and counter-claims there would be no objection to the appointment of an arbitrator, as there was no dispute about the execution of the agreements containing arbitration clauses.
Kitchen access protected for now; arrears secured by deposit
The respondent submitted that the petition might be considered as an application under Section 17 of the Act, and that until the arbitrator decided it, the existing arrangement for the use and access of the 200 sq. ft. kitchen area would be permitted without obstruction from its side. The Court recorded that this was a purely temporary measure, with all rights reserved.
Counsel for the respondent submitted that, by its calculation, the petitioners were in arrears of ₹51,69,376. Counsel for the petitioners disputed the outstanding amount but submitted on instructions that it would be deposited with the Registry within four weeks. Ashish Kumar, a director of both petitioners, was present in Court and undertook to deposit the amount, without prejudice to the petitioners' rights and contentions.
What the order directs
With the consent of the parties, the Court directed that the disputes concerning the agreement be referred to arbitration, that Justice Chander Shekhar be appointed sole arbitrator, and that the arbitration be held under the aegis of the Delhi International Arbitration Centre and governed by its rules, with the arbitrator's fee fixed under the DIAC (Administrative Cost and Arbitrator's Fees) Rules, 2018.
The arbitrator was requested to furnish a declaration under Section 12 of the Act before entering upon the reference. All rights and contentions of the parties, including arbitrability, preliminary objections and the merits of any claim or counter-claim, were left open for the arbitrator. The petitioners were directed to report to the Coordinator of DIAC within ten working days, and a copy of the order was directed to be sent to the arbitrator.
BANTHRY ANALYSISA deposit that protects both sides while the merits wait
The deposit direction is the most instructive part of this order. The respondent claimed arrears of ₹51,69,376 and the petitioners disputed them; rather than decide the dispute on affidavits, the Court secured the money. The deposit is made without prejudice, held in an interest-bearing fixed deposit, and released only as the arbitrator directs — so the respondent is protected against non-payment if the arrears are found due, and the petitioners are protected against losing money they may not owe.
The order also shows how a three-arbitrator clause can yield a sole arbitrator: the parties agreed to it. The agreements provided for a three-member tribunal, but both sides told the Court they had no objection to a former judge of the Court being appointed sole arbitrator, and waived the settlement endeavours and the Section 21 notice. Party autonomy in arbitration extends to the composition of the tribunal, and the Court gave effect to that agreement rather than enforcing the clause mechanically.
BANTHRY ANALYSISFor law students
Note the difference between the two interim protections in this order. The kitchen-area access was protected by an assurance recorded by the Court — the respondent's counsel submitted the existing arrangement would be permitted without obstruction until the arbitrator decided the Section 17 application. The money was protected by a deposit the petitioners undertook to make with the Registry. Assurances and deposits are the two standard tools by which a Section 9 court preserves the status quo without deciding the merits, and both are routinely converted into Section 17 applications once the tribunal is constituted.
READING PROMPTSQuestions for a closer reading
- What interim arrangement did the Court make for the disputed ₹51,69,376, and who decides its ultimate destination?
- Why did the Court treat the Section 9 petition as a Section 17 application, and what temporary protection did the respondent offer in the meantime?
- How did the parties' agreements provide for arbitration, and what did the parties waive to reach the reference?
