Bombay High Court
SHRIRAM CITY UNION FINANCE LIMITED.versusSHABBIR NOORUDDIN SHAIKH AND ANR.
- Decided
- Disposal
- DISPOSED OFF
- Bench
- RAJESH S PATIL
Holding
The arbitral award is declared void ab initio and non‑executable due to the unilateral appointment of the arbitrator.
Summary
The claimant, Shriram City Union Finance Ltd., filed an execution application based on an arbitral award, contending that the arbitrator had been appointed unilaterally. The claimant sought to withdraw the execution proceeding and obtain liberty to commence fresh arbitration. The Court, relying on the Supreme Court’s decision in Bhadra International (India) Pvt. Ltd. v. Airport Authority of India (2026), held that an award can be set aside at the execution stage if the arbitrator’s appointment was unilateral. Accordingly, the Court declared the award void ab initio, non‑enforceable, and ordered the execution application to be withdrawn. It further permitted the parties to initiate new arbitration proceedings and excluded the period from the original arbitration’s commencement for limitation purposes.
Issues considered
- Whether an arbitral award can be executed when the arbitrator was appointed unilaterally.
- Whether the award is void ab initio and therefore non‑enforceable.
- Whether the execution application may be withdrawn and fresh arbitration commenced.
- Effect of the arbitration’s timeline on the limitation period for a new arbitration.
Subjects
- Arbitration
- Arbitral award
- Void ab initio
- Unilateral appointment
- Execution of award
- Limitation period
- Fresh arbitration
Judgment
Vivekanand
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8-EXA-2105-2018.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
EXECUTION APPLICATION NO. 2105 OF 2018
WITH
NOTICE NO. 920 OF 2025
IN
EXECUTION APPLICATION NO. 2105 OF 2018
Shriram City Union Finance Limited ….. Claimant
Versus
Shabbir Nooruddin Shaikh & Anr. ….. Respondents
Mr. Vishal V. Narkar, Advocate for the Claimant.
CORAM : RAJESH S. PATIL, J.
DATE : 24th MARCH, 2026
P.C. :-
1) Mr. Narkar, learned counsel appearing for the claimant
submits that the execution proceedings arise out of an Arbitral Award,
where the Arbitrator’s appointment was unilateral. Hence, he on
instructions of his client seeks leave to withdraw the present execution
application, with liberty to initiate fresh arbitration proceedings.
2) I have taken a view in the judgment of L & T Finance Ltd.
vs. Sangeeta Bhansali & Anr. in Commercial Execution Application (L)
No. 5277 of 2022, considering the latest judgment of the Supreme
Court decided on 5 January, 2026, in the matter of Bhadra
Vivekanand
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8-EXA-2105-2018.doc
International (India) Pvt. Ltd. and others vs. Airport Authority of
India, Civil Appeal No. 37-38 of 2026, wherein it has been held that
even at the stage of execution, an arbitral award can be set aside
being void-ab-initio on the grounds that the appointment of the
arbitrator was unilateral.
3) Leave and liberty as prayed for, is granted.
3.1) The Arbitral Award which is subject matter of the present
proceedings is hereby declared to be non-est in law, non-executable
and void-ab-initio.
4) Execution Application stands disposed of as withdrawn.
5) In sequel, Notice & the Interim Applications, if any, also
stand disposed of.
6) It shall be open for the parties to initiate fresh arbitration
proceedings in accordance with law.
7) As far as limitation is concerned, the period from the
invocation of the arbitration till today shall stand excluded for the
purpose of initiating fresh arbitration proceedings.
(RAJESH S. PATIL, J.)
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