Sh. Sunder Lal Gupta vs M/S Sahyog Hospitality And Others Through Its Partners

$~24
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 27.04.2026
+ OMP (ENF.) (COMM.) 284/2025
SH. SUNDER LAL GUPTA .....Decree Holder
Through: Mr. Manoj Chouhan and Ms.
Neha Raj Singh, Advocates.

versus

M/S SAHYOG HOSPITALITY AND OTHERS THROUGH
ITS PARTNERS .....Judgement Debtor
Through: Mr. Apoorv Kurup, Senior
Advocate along with Mr. Vijay
Kasana, Mr. Aayush Mishra,
Mr. Gurjas Narula and Mr.
Vaibhav Sharma, Advocates.
CORAM:
HON'BLE MR. JUSTICE HARISH VAIDYANATHAN
SHANKAR

% JUDGEMENT (ORAL)
HARISH VAIDYANATHAN SHANKAR, J.

1. The present Petition has been instituted under Section 17(2) of
1
the Arbitration and Conciliation Act, 1996 , read with Order XXI
2
Rule 11(2) of the Code of Civil Procedure, 1908 , seeking
3
enforcement and execution of the Interim Order dated 06.11.2025
passed by the learned Sole Arbitrator, in DIAC Case Reference No.
DIAC/11070/06-25. By way of the said Petition, the Decree Holder
prays for the following reliefs:

1
A&C Act
2
CPC
3
Interim Order
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“A. Enforce/execute the Order dated 06/11/2025 passed by the
Hon'ble Sole Arbitrator Justice Ms. Rekha Palli (Retd.) in
case reference No.DIAC/ 11070/06-25 in favour of petitioner
granting the following reliefs:
a) Direct the Respondent to deposit with the DIAC 81.25%
monthly mesne profits@ Rs. 25,86,095/- along with the GST
for the last 12 months i.e. 01.11.2024 to 31.10.2025 which is
amounting to Rs. 2,97,53,023/-
b) Direct the Respondents to deposit the Rs. 2,97,53,023/- with
DIAC along with 18% interest on delay in depositing the
amount.
c) Pass an order directing the Respondents to disclose on oath all
their bank accounts and properties to make recoveries by
attaching the bank accounts of the Respondents towards the
fulfilment on interim order dated 6/11/2025.
d) Pass an order for attachment and sale of the properties of the
Respondents.
e) Cost of the enforcement proceedings maybe awarded in the
favour of petitioner.
B. This Hon'ble Court may pass any other Order/s and such other
and further Order/s as may be deemed to fit and Proper in the
facts and circumstances of the present case.”

2. The Interim Order dated 06.11.2025 was passed by the learned
Sole Arbitrator on an application filed by the Decree Holder/ Claimant
therein under Section 17 of the A&C Act, in the course of arbitral
proceedings between the parties.
3. On the preliminary issue concerning the continuation of the
present Petition, which seeks execution of an interim order passed by
the learned Arbitral Tribunal even after the pronouncement of the
4
Arbitral Award dated 02.03.2026 , learned counsel appearing on
behalf of the Decree Holder submits that the Petition is clearly
maintainable in law.
4. It is the submission of the learned counsel for the Decree
Holder that the A&C Act expressly envisages the initiation as well as
continuation of proceedings under Section 17(2) for enforcement of

4
Final Award
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interim measures granted by the Arbitral Tribunal, without prescribing
any limitation or embargo based on the stage of the arbitral
proceedings or the subsequent rendering of the final award.
5. Per Contra , learned senior counsel for the Judgment Debtor
does not dispute, in principle, the maintainability of a petition under
Section 17(2) for enforcement of an interim order. However, it is
contended that, in the peculiar facts of the present case, the Interim
Order sought to be enforced stands subsumed in the Final Award. It is
further submitted that the interim direction required deposit with the
Delhi International Arbitration Centre of an amount representing
81.25% of the monthly mesne profits, quantified at Rs. 25,86,095/- for
the period from 01.11.2024 to 31.10.2025, and that this very issue has
been comprehensively addressed in the Final Award.
6. In support of the aforesaid contention, learned senior counsel
for the Judgment Debtor has drawn the attention of this Court to the
operative portion of the Final Award, whereby Claim No. 2 has been
allowed. The relevant extract reads as follows:
“ 37. In the present case, in the absence of any evidence to establish
that the sum of Rs. 2,00,000/- per day stipulated under clause 27 of
the Contract represents a genuine pre-estimate of loss or actual
damage, the said clause appears to be penal in nature.
Consequently, the Claimant would be entitled only to such
reasonable compensation as can be assessed on the basis of
available material, and not the entire penal amount stipulated under
Clause 27. From a perusal of the lease deed itself, it emerges that
the parties had agreed for an enhancement of 15% on the last paid
rent every year and therefore, in line with the directions issued on
06.11.2025, it would be in the interest of justice to direct the
Respondents to pay to the Claimants 81.25% share of Rs.
25,87,008/- w.e.f. 01.11.2024, i.e., Rs. 21,01,944/- as monthly
mesne profits/damages till the time possession is handed over. This
monthly amount of Rs. 21,01,944/- has been arrived at by
increasing by 15% the agreed rental which was payable till
31.10.2024. Claim no. 2 is accordingly allowed in favour of the
Claimants in the aforesaid terms ”
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7. On the strength of the above, it is submitted that the Final
Award directs payment of 81.25% of the mesne profits commencing
from 01.11.2024, as contemplated in the Interim Order. The only
variation, according to the learned senior counsel, lies in the duration
of such payment, while the Interim Order was confined to the period
from 01.11.2024 to 31.10.2025, the Final Award extends the liability
until the date of handing over vacant possession of the subject
property.
8. In this backdrop, learned senior counsel for the Judgment
Debtor contends that the interim directions have effectively merged
into the Final Award, and therefore ceases to have an independent
existence for the purpose of enforcement.
9. It is further submitted that, consequent upon the passing of the
Final Award, the statutory scheme under Sections 34(3) and 36(1) of
the A&C Act becomes operative. In other words, enforcement
proceedings in respect of the Award cannot be initiated until the
expiry of the prescribed period of three months for challenging the
Award, and thus, the present Petition is premature and not
maintainable.
10. In rebuttal , learned counsel for the Decree Holder submits that
the legislative intent underlying Section 17(2) of the A&C Act is clear
and unequivocal, namely , to ensure enforceability of interim measures
granted by the Arbitral Tribunal in the same manner as orders of a
court.
11. It is contended by the learned counsel that Section 17(2) of the
A&C Act confers an independent and substantive right upon a party to
seek enforcement of an interim order, and such right is not
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extinguished or diluted merely because the Final Award addresses the
same subject matter. Accordingly, the present Petition remains
maintainable notwithstanding the subsequent pronouncement of the
Award.
12. Learned counsel for the Decree Holder further submits that
Sections 17 and 36 of the A&C Act operate in distinct and
independent domains. While Section 17 pertains to interim measures
granted during arbitral proceedings, Section 36 governs the
enforcement of final arbitral awards. The operation of one provision
does not eclipse or override the other.
13. It is thus urged that all orders passed by an Arbitral Tribunal
are, by virtue of Section 17(2) of the A&C Act, enforceable as if they
were orders of a civil court. Any interpretation to the contrary would
render the provision otiose and defeat the very purpose for which it
was introduced.
14. In support of the aforesaid submissions, reliance is placed by
learned counsel for the Decree Holder on the judgment of the Hon’ble
5
Supreme Court in Alka Chandewar v. Shamshul Ishrar Khan ,
particularly Paragraph 9, which reads as follows:

5
(2017) 16 SCC 119
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ANALYSIS & DECISION:
15. This Court has heard learned counsel appearing on behalf of the
parties at length and, with their able assistance, has carefully
considered the pleadings on record, the judicial precedents cited
across the Bar, as well as the final Award, a copy of which has been
placed before the Court during the course of submissions.
16. A perusal of Section 17 of the A&C Act demonstrates that the
provision pertains to interim measures of protection that may be
granted by an Arbitral Tribunal. Such measures are intended to
operate during the pendency of arbitral proceedings, so as to preserve
the subject matter of the dispute and safeguard the interests of the
parties. In the present case, the Interim Order sought to be enforced
was admittedly passed during the pendency of the arbitral
proceedings. The Decree Holder thereafter invoked Section 17(2) of
the A&C Act by filing the present Petition seeking enforcement of the
said Interim Order. However, during the pendency of the present
Petition, the arbitral proceedings culminated in the passing of the
Final Award dated 02.03.2026.
17. At this juncture, it would be apposite to examine the legislative
framework governing Section 17 of the A&C Act. Prior to the
Arbitration and Conciliation (Amendment) Act, 2015, Section 17 was
couched in a limited form, empowering the Arbitral Tribunal to grant
interim measures but without providing any statutory mechanism for
their enforcement. The provision, as it then stood, read as follows:
“ 17. Interim measures ordered by arbitral tribunal
(1) Unless otherwise agreed by the parties, the arbitral tribunal
may, at the request of a party, order a party to take any interim
measure of protection as the arbitral tribunal may consider
necessary in respect of the subject-matter of the dispute.
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(2) The arbitral tribunal may require a party to provide appropriate
security in connection with a measure ordered under sub-section
(1).”


18. By virtue of the 2015 Amendment Act, Section 17 was
substituted in its entirety, introducing a significantly expanded
framework. The amended provision not only elaborated the nature and
scope of interim measures that could be granted, but, more
importantly, introduced sub-section (2), which expressly provided for
the enforceability of such orders. The amended Section 17 reads as
follows:
“ 17. Interim measures ordered by arbitral tribunal: -
( 1 ) A party may, during the arbitral proceedings or at any time
after the making of the arbitral award but before it is enforced in
accordance with section 36 measures apply to the arbitral tribunal-
(i) for the appointment of a guardian for a minor or person of
unsound tribunal. mind for the purposes of arbitral
proceedings: or
(ii) for an interim measure of protection in respect of any of the
following matters, namely: -
(a) the preservation, interim custody or sale of any goods
which are the subject-matter of the arbitration agreement:
(b) securing the amount in dispute in the arbitration;
(c) the detention, preservation or inspection of any property
or thing which is the subject-matter of the dispute in
arbitration, or as to which any question may arise therein
and authorising for any of the aforesaid purposes any
person to enter upon any land or building in the
possession of any party, or authorizing any samples to be
taken, or any observation to be made, or experiment to
be tried, which may be necessary or expedient for the
purpose of obtaining full Information or evidence;
(d) interim injunction or the appointment of a receiver;
(e) such other interim measure of protection as may appear to
the arbitral tribunal to be just and convenient,
and the arbitral tribunal shall have the same power for making
orders, as the court has for the purpose of, and in relation to, any
proceedings before it.
( 2 ) Subject to any orders passed in an appeal under section 37, any
order issued by the arbitral tribunal under this section shall be
deemed to be an order of the Court for all purposes and shall be
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enforceable under the Code of Civil Procedure, 1908, in the same
manner as if it were an order of the Court.”

19. The aforesaid amendment was introduced pursuant to the
recommendations of the Law Commission of India in its 246th
Report, which identified a critical lacuna in the pre-amendment
regime, namely , the absence of any effective mechanism to enforce
interim orders passed by arbitral tribunals. This concern, and the
rationale for legislative intervention, was noticed by the Hon’ble
Supreme Court in Alka Chandewar (supra) , wherein it was observed
that the amendment was intended to provide a complete and
efficacious solution to ensure that interim orders of arbitral tribunals
are not rendered ineffectual. The relevant portion of the said judgment
reads as follows:
“8. Coming to Shri Rana Mukherjee's submission that sub-section
(2) of Section 17 introduced by the 2015 Amendment Act now
provides for the necessary remedy against infraction of interim
orders by the Tribunal, suffice it to state that the Law Commission
itself, in its 246th Report, found the need to go one step further
than what was provided in Section 27(5) as construed by the Delhi
High Court [ Sri Krishan v. Anand , 2009 SCC OnLine Del 2472 ].
The Commission, in its Report, had this to say:
“ Powers of Tribunal to order interim measures
46. Under Section 17, the Arbitral Tribunal has the power
to order interim measures of protection, unless the parties
have excluded such power by agreement. Section 17 is an
important provision, which is crucial to the working of the
arbitration system, since it ensures that even for the
purposes of interim measures, the parties can approach the
Arbitral Tribunal rather than await orders from a court.
The efficacy of Section 17 is however, seriously
compromised given the lack of any suitable statutory
mechanism for the enforcement of such interim orders of
the Arbitral Tribunal.
47. In Sundaram Finance Ltd. v. NEPC India Ltd. ,
(1999) 2 SCC 479 , the Supreme Court observed that
though Section 17 gives the Arbitral Tribunal the power to
pass orders, the same cannot be enforced as orders of a
court and it is for this reason only that Section 9 gives the
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court power to pass interim orders during the arbitration
proceedings. Subsequently, in Army Welfare Housing
Organisation v. Sumangal Services (P) Ltd. , (2004) 9
SCC 619 , the Court had held that under Section 17 of the
Act no power is conferred on the Arbitral Tribunal to
enforce its order nor does it provide for judicial
enforcement thereof.
48. In the face of such categorical judicial opinion, the
Delhi High Court attempted to find a suitable legislative
basis for enforcing the orders of the Arbitral Tribunal
under Section 17 in Sri Krishan v. Anand , 2009 SCC
OnLine Del 2472 [followed in Indiabulls Financial
Services Ltd. v. Jubilee Plots & Housing (P) Ltd. , 2009
SCC OnLine Del 2458 ]. The Delhi High Court held that
any person failing to comply with the order of the Arbitral
Tribunal under Section 17 would be deemed to be
“making any other default” or “guilty of any contempt to
the Arbitral Tribunal during the conduct of the
proceedings” under Section 27(5) of Act. The remedy of
the aggrieved party would then be to apply to the Arbitral
Tribunal for making a representation to the court to mete
out appropriate punishment. Once such a representation is
received by the court from the Arbitral Tribunal, the court
would be competent to deal with such party in default as if
it is in contempt of an order of the court i.e. either under
the provisions of the Contempt of Courts Act or under the
provisions of Order 39 Rule 2-A of the Code of Civil
Procedure, 1908.
49. The Commission believes that while it is important to
provide teeth to the interim orders of the Arbitral Tribunal
as well as to provide for their enforcement, the judgment
of the Delhi High Court in Sri Krishan v. Anand , 2009
SCC OnLine Del 2472 is not a complete solution . The
Commission has, therefore, recommended amendments to
Section 17 of the Act which would give teeth to the orders
of the Arbitral Tribunal and the same would be statutorily
enforceable in the same manner as the orders of a court. In
this respect, the views of the Commission are consistent
with (though do not go as far as) the 2006 amendments to
Article 17 of the Uncitral Model Law.””
(emphasis supplied)

20. A careful reading of the observations of the Law Commission
of India, as noticed and extracted by the Hon’ble Supreme Court,
makes it abundantly clear that, prior to the Arbitration and
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Conciliation (Amendment) Act, 2015, the statutory framework
suffered from a significant infirmity insofar as interim measures
granted by an Arbitral Tribunal under Section 17 were concerned.
21. Although the Tribunal was vested with the power to grant such
interim reliefs, there existed no direct or efficacious mechanism for
their enforcement. As a result, parties were compelled to resort to
indirect and often cumbersome judicial processes to secure
compliance. This not only diluted the authority of the Arbitral
Tribunal but also undermined the very objective of arbitration as a
self-contained, efficient, and expeditious dispute resolution
mechanism. It was precisely to cure this deficiency and to impart
efficacy to the orders of the Tribunal that sub-section (2) was
introduced to Section 17, thereby statutorily elevating such orders to
the status of orders of a civil court for the limited purpose of
enforcement.
22. Section 17(2) of the A&C Act, which assumes central
significance in the present controversy, is couched in clear and
unambiguous terms. It provides that any order passed by an Arbitral
Tribunal under Section 17 shall be deemed to be an order of the Court
“for all purposes” and shall be enforceable in accordance with the
provisions of the CPC, in the same manner as if it were an order
passed by the Court itself. The legal consequence of this deeming
fiction is that interim measures granted by the Tribunal acquire
enforceability through the established machinery of civil execution.
23. Accordingly, such orders may be executed under the provisions
of Order XXI of the CPC, which governs the “ Execution of Decrees
and Orders ”. The introduction of Section 17(2) of the A&C Act,
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therefore, marks a decisive shift in the legislative scheme by creating a
direct, formal, and effective enforcement mechanism, one that was
conspicuously absent in the pre-amendment regime, and by ensuring
that interim orders of the Tribunal are not rendered illusory or
ineffectual.
24. Further developments in the statutory scheme must also be
noticed. By way of the Arbitration and Conciliation (Amendment)
Act, 2019, a limited yet significant modification was introduced to
Section 17(1), whereby the words “ or at any time after the making of
the arbitral award but before it is enforced in accordance with Section
36 ” came to be omitted. The effect of this deletion is to clarify and
confine the temporal scope within which an Arbitral Tribunal may
exercise its power to grant interim measures. Under the amended
framework, such power is restricted to the period during which the
arbitral proceedings are pending and does not extend beyond the
making of the arbitral award.
25. The net effect of the Amendments, therefore, appears to be that
the power of the Arbitral Tribunal to grant interim measures under
Section 17 of the A&C Act is circumscribed to the pendency of
arbitral proceedings and does not extend beyond the making of the
Final Award. In other words, interim measures, by their very nature,
are intended to operate during the subsistence of the arbitral
proceedings.
26. In the facts of the present case, it is an admitted position that the
Final Award came to be rendered on 02.03.2026. A perusal of the said
Award reveals that the substantive directions contained in the Interim
Order dated 06.11.2025 have not only been taken into consideration
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but have, in effect, been incorporated within the Final Award itself,
albeit with an expanded scope. While the Interim Order directed
payment of 81.25% of the monthly mesne profits for a specified
period, the Final Award extends this liability from the same
commencement date, i.e., 01.11.2024, until the handing over of vacant
possession of the subject property. In these circumstances, this Court
is of the considered view that the interim directions, to the extent they
relate to the determination and payment of mesne profits, stand
subsumed and merged into the Final Award.
27. In such a scenario, if this Court were to proceed to grant the
reliefs sought in the present Petition under Section 17(2) of the A&C
Act, particularly when, during the pendency of the Petition, the Final
Award has already been rendered, it would give rise to a situation
where the statutory scheme governing the enforcement of arbitral
awards may be rendered otiose. This Court observes so because
Section 36 of the A&C Act expressly provides that an arbitral award
shall be enforced as a decree only upon the expiry of the period
prescribed under Section 34(3), namely , three months from the date of
the award, subject to any extension of 30 days granted for sufficient
cause. Entertaining and allowing the present Petition in such
circumstances would effectively bypass this statutory framework.

28. This Court is in agreement with the submission advanced on
behalf of the Decree Holder to the extent that a petition under Section
17(2) of the A&C Act is, in principle, independently maintainable for
the enforcement of interim measures granted by an Arbitral Tribunal.
This position flows both from the legislative intent underlying the
provision and the law laid down by the Hon’ble Supreme Court in
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Alka Chandewar (supra) . However, given the peculiar fact that the
Final Award has been rendered during the pendency of the present
proceedings and has comprehensively dealt with, and effectively
incorporated, the subject matter of the interim order, it becomes
necessary to harmonise the operation of the relevant provisions of the
A&C Act so as to give full and meaningful effect to the statutory
scheme as a whole.
29. In this view of the matter, this Court is of the considered
opinion that, where the directions contained in an interim order are
effectively subsumed into the operative part of the Final Award, the
enforcement of such directions must thereafter be governed by the
regime applicable to the enforcement of arbitral awards.
Consequently, the provisions of Sections 34(3) and 36(1) of the A&C
Act must be allowed to operate in their full play, without being
circumvented through parallel enforcement proceedings under Section
17(2) of the A&C Act.
30. This Court, therefore, is unable to accept the contention
advanced on behalf of the Decree Holder that the present Petition
ought to be allowed for enforcement of the Interim Order
notwithstanding the subsequent passing of the Final Award, which has
addressed the very same subject matter in a comprehensive manner
during the pendency of these proceedings. Acceptance of such a
contention would, in effect, disrupt the statutory framework of the
A&C Act and dilute the procedural safeguards embedded in the
provisions governing challenge and enforcement of arbitral awards.
31. It is, however, clarified that had the Final Award not been
rendered during the pendency of the present Petition, this Court would
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have been fully justified in proceeding to enforce the Interim Order in
exercise of its powers under Section 17(2), read with the relevant
provisions of the CPC.
32. This Court also deems it appropriate to observe that interim
orders passed by an Arbitral Tribunal, being a forum constituted by
the consent of the parties, carry binding force and are expected to be
complied with in letter and spirit. In the event of non-compliance,
Section 17(2) of the A&C Act empowers the Court to take appropriate
measures to secure enforcement of such orders. However, this
enforcement mechanism is inherently linked to the interim nature of
such directions and cannot be extended in a manner that permits their
independent enforcement even after the Final Award has been
rendered, particularly where the Award itself comprehensively
addresses and governs the subject matter of the Interim Order.
33. In view of the foregoing discussion, this Court is of the
considered opinion that, in the peculiar facts and circumstances of the
present case, the reliefs sought under Section 17(2) of the A&C Act
cannot be granted at this stage. Accordingly, the present Petition
stands dismissed.
34. It is, however, clarified that the Decree Holder shall be at
liberty to avail such remedies as may be available to it in law.

35. At this stage, since a copy of the Final Award has been handed
over to the Court during the course of the hearing, this Court deems it
appropriate to direct that the same be taken on record. The Registry is
accordingly directed to place the copy of the Final Award on the Court
record.
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36. The present Petition, along with pending application(s), if any,
stands disposed of in the above terms.

HARISH VAIDYANATHAN SHANKAR, J.
APRIL 27, 2026/nd/va
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