Oyo Hotels And Homes Pvt. Ltd. vs Shri Amit Samanta

$~8
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Decision : 13.05.2026
+ FAO (COMM) 242/2023 CM APPL. 61277/2023
OYO HOTELS AND HOMES PVT. LTD. .....Appellant
Through: Mr. Nikilesh Ramachandran, Mr.
Sagar Kumar Pradhan, Mr. Diptiman
Aacharya, Mr. Samarth Mehrotra and
Mr. Kartik Yadav, Advocates
versus
SHRI AMIT SAMANTA .....Respondent
Through: Mr. Neil Wadia, Mr. Narayan Wadia,
Ms. Jyoti Saini, Ms. Tanvi Munjal
and Mr. Piyush Wadia, Advocates
CORAM:
HON'BLE MR. JUSTICE V. KAMESWAR RAO
HON'BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA
V. KAMESWAR RAO, J. (ORAL)
1. This appeal challenges the order dated 10.10.2023 by the learned
District Judge (Commercial Court)-02, Dwarka Courts, New Delhi, whereby
the application filed by the appellant herein under Section 8 of the
Arbitration and Conciliation Act, 1996 (‘Act of 1996’) seeking reference of
the dispute to arbitration was dismissed.
2. It is not in dispute that pursuant to the summons received by the
appellant herein, the appellant had filed written statement to which,
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Signed By:MAHIMA
SHARMA
Signing Date:19.05.2026
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replication was also filed by the respondent herein.
3. The learned District Judge noted that the appellant had in the written
statement referred to the provisions of the agreement executed between the
appellant and the respondent; but without stating the fact that the agreement
contains an arbitration clause.
4. In the impugned order, the learned District Judge referring to the
judgment of the Supreme Court in Sukanya Holdings Pvt. Ltd vs Jayesh H.
Pandya & Anr . AIR 2003 SC 2252 and also the judgment of this Court in
the case of Mi2C Security Facilities Pvt Ltd vs North Delhi Municipal
Corporation , W.P.(C) 8197/2017, observed that if a party has filed its first
statement without any intimation of the arbitration clause before the judicial
authority then it would be presumed that the party has waived off its right to
invoke the arbitration clause as per Section 8 of the Act of 1996. Relevant
part of the order is reproduced as under:-
“3. Perusal of written statement reveals that the defendant had
specifically mentioned that plaintiff and defendant had entered into
an agreement dated 01.08.2017 and reference was also given to
clauses of the said agreement in the written statement. There was
no whisper in the entire written statement with regard to said
agreement containing arbitration clause nor any such application
separately had been moved. Despite the specific mention in the
written statement with regard to agreement dated 1.8.2017, same
was not even filed alongwith the written statement. Pleadings in the
case had already been complete and matter was fixed for framing of
issues when the instant application was moved. In these
circumstances, since the defendant at the first instance had not
invoked for reference of the matter to arbitration, defendant deemed
to have waived off its right to invoke arbitration clause.
4. Hon’ble Apex Court in Sukanya Holdings Pvt. Ltd vs Jayesh H.
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Signed By:MAHIMA
SHARMA
Signing Date:19.05.2026
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Pandya & Anr , observed that section 8 is essentially an
acknowledgment of the fact that parties can waive an arbitration
agreement. Conditions under section 8 are meant to provide for
reading such waiver by conduct. When a suit is filed despite an
arbitration agreement, it is an offer by one party to terminate this
agreement. If the other party joins the suit by contesting it on
substance, it accepts such offer and the arbitration agreement
comes to an end. Section 8 provides that failure to invoke the
arbitration agreement within reasonable time shall also be deemed
to be an acceptance.
5. In Mi2C Security Facilities Pvt Ltd vs North Delhi Municipal,
W.P.(C) 8197/2017 & CM. No. 33688/2017 , it was observed by
Hon’ble High Court of Delhi that if the party has filed its first
statement without any intimation of the arbitration clause before
the judicial authority, then it would be presumed that the party has
waived off its right to invoke the arbitration clause as per section 8
of the Arbitration and Conciliation Act.
6. Application u/s 8 of Arbitration and Conciliation Act, in these
circumstances, stands dismissed.
7. From the pleadings of parties, following issues are hereby
framed:
(1) Whether the plaintiff is entitled for recovery of the suit amount,
as claimed? OPP
(2) Whether the rights of plaintiff to receive the payments were
contingent upon furnishing the requisite compliance documents by
defendant? If so, its effect. OPD
(3) Relief.
8. No other issue arises or is pressed for. Be put up the matter for
PE on 1.11.2023 and for DE on 7.11.2023. On request, date for PE
is changed to 10.11.2023 and for DE is changed to 20.11.2023.
9. Affidavits in evidence on behalf of witnesses from both sides be
supplied in advance to opposite party.”
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Signed By:MAHIMA
SHARMA
Signing Date:19.05.2026
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5. The submission of Mr. Nikilesh Ramachandran, learned counsel for
the appellant is primarily that the appellant could neither file the application
under Section 8 of the Act of 1996 nor refer to the fact that the agreement
contains an arbitration clause alongwith the written statement because the
appellant was not in possession of the agreement. He states it is after
retrieving the agreement that the application was filed and hence, delay, if
any, shall have no effect on the merits of the plea of the appellant that the
suit is not maintainable and as such the parties need to be referred to
arbitration for resolution of their disputes.
6. He states that the obligation to file the agreement was on the
respondent and not on the appellant herein.
7. We are not in agreement with the submissions made by Mr.
Ramachandran. It was incumbent on the appellant to file the application
under Section 8 of the Act of 1996 enclosing the agreement. Failing to do
that, and having filed written statement on the substance of the dispute, it is
presumed in law that appellant has waived its right to invoke the arbitration
clause. The contention that the appellant was not in possession of the
agreement at the time of filing the written statement is not appealing. Such a
plea, in any way, does not absolve the appellant of the procedural
requirements of Section 8 of the Act of 1996.
8. In fact, the respondent herein had also filed a replication to the written
statement filed by the appellant. If that be so, the learned District Judge is
right in relying upon the judgment in Mi2C Security Facilities Pvt Ltd
(supra) , wherein this Court has stated as under:-
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Signed By:MAHIMA
SHARMA
Signing Date:19.05.2026
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“8. There is no dispute that the respondent Corporation had
initially filed a short affidavit followed by a reply to the additional
affidavit filed by the petitioner. The short affidavit was on the merit
of the controversy which falls for consideration in the writ petition.
So, it follows the short affidavit to the writ petition and reply
affidavit to the additional affidavit filed by the petitioner are the
first statement on the dispute without resorting to the provisions of
Section 8 of the Arbitration and Conciliation Act. If that be so, the
respondent having submitted itself to the jurisdiction of this Court /
waived its right to invoke Arbitration, cannot contend that the
parties herein should be relegated to Arbitration in view of the
existence of an Arbitration clause.
9. This proposition of law is well settled by the Supreme Court in
the case of Rashtriya Ispat Nigam Limited vs. M/S Verma
Transport Company, (2006) 7 SCC 275 wherein it held that the
expression “first statement on the substance of the dispute”
contained in Section 8(i) of the Act is different from the expression
“written statement”. It held, it employs submission of the party
making the application under Section 8 of the Act, to the
jurisdiction of the Judicial Authority. What should be decided by
the Court is whether the party seeking reference to arbitration has
waived its right to invoke Arbitration. The Supreme Court also held,
that if an application is filed before actually filing the first
statement on the substance of the dispute, then the party cannot be
said to have waived its right or acquiesced itself to the jurisdiction
of the Court. So, what is, therefore, material is as to whether the
petitioner has filed its first statement on the substance of the dispute
or not, if not its application under Section 8 of the 1996 Act may not
be held wholly unmaintainable. In the case in hand, even though,
the affidavit has been referred to as a short affidavit, the respondent
has actually submitted the affidavit on the merit of the dispute.
Having done that despite taking a plea with regard to arbitration
clause, it must be construed that the same does indicate that the
respondent Corporation has showed its intention to submit itself to
the jurisdiction of the Court. This has also been held by the
Supreme Court in the case of Booz Allen & Hamilton Inc. v. SBI
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Signed By:MAHIMA
SHARMA
Signing Date:19.05.2026
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Home Finance Ltd., (2011) 5 SCC 532 wherein in para 25, it held
not only filing of the written statement in a suit but filing of any
statement, application, affidavit by a defendant prior to the filing of
the written statement will be construed as submission of a statement
on the substance of the dispute if by filing such statement /
application / affidavit the defendant shows his intention to submit
himself to the jurisdiction of the Court and waived his right to seek
reference to Arbitration.
10. It may also be stated here, the short affidavit filed by the
petitioner was surely not opposing an interim relief or any
connected proceedings and but for the writ petition. Similarly, a
Coordinate Bench of this Court in the case of M/S S.D.Buildwell
Pvt.Ltd. vs. Rail Land Development Authority, 220 (2015) DLT
734 , has in para 52 has held as under:
“52. On the issue raised by the respondent that there was
an Arbitration Clause, therefore, the petitioner should
approach the Arbitration Tribunal. It is relevant to note
that as per Section 8 of the Arbitration and Conciliation
Act, 1966, an application should be filed before the party
files its first statement on the substance of the dispute.
However, the respondent had filed its counter-affidavit on
08.08.2012 whereas the application under Section 8 of
the Act was filed on 07.09.2012. Therefore, since the
respondent chose to file its application after filing of its
first counter-affidavit, the said application is not
maintainable.”
11. Even this Court in a recent pronouncement in the case of
Vikram Sharma v. Union of India W.P.(C) 10588/2016 decided on
January 29, 2018 has by referring to the judgment of the Supreme
Court in the case of Booz Allen & Hamilton Inc. (supra) and this
Court in S.D.Buildwell Pvt.Ltd. (supra) rejected the plea taken by
the respondent in that case on the maintainability of the writ
petition in view of the existence of an arbitration clause by holding
that the respondent having filed its statement on the dispute by way
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Signed By:MAHIMA
SHARMA
Signing Date:19.05.2026
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of a counter affidavit to the writ petition is precluded from taking
the plea that there exist an arbitration agreement. In view of the
above, the plea of Ms. Biji Rajesh on the non-maintainability of the
petition needs to be rejected. Suffice to state, the issue needs to be
considered on merit and I accordingly proceed to examine the
same.”
9. Keeping in view the facts which we have noted from the record, and
the position of law, we are of the view that no fault can be found with the
impugned order passed by the learned District Judge.
10. The appeal being without any merit is dismissed. The pending
application has become infructuous and is dismissed.
V. KAMESWAR RAO, J
MANMEET PRITAM SINGH ARORA, J
MAY 13, 2026/ rhc
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Signed By:MAHIMA
SHARMA
Signing Date:19.05.2026
10:50