Delhi HC Temporarily Freezes Seller’s Two Gurugram Plots For Buyer Who Lost Arbitration, Finding Tribunal’s “Sham” Loan-Letter Finding Prima Facie Unsupported

The parties entered into two Agreements to Sell dated 4 May 2019 for separate Gurugram properties, each for ₹5,62,24,000; Thor Ventures paid ₹5,00,000 for each property.

Its claim for specific performance relied on a loan sanction letter dated 7 July 2019 from Pooja Finelease Limited (PFL), an RBI-registered NBFC.

The arbitral tribunal upheld the validity of the agreements and the authority of the respondent’s representative, but rejected specific performance and permanent injunction after finding that Thor had not proved readiness and willingness and that the loan sanction letter was a sham document.

The tribunal awarded the respondent ₹15,00,000 in costs and its interim restraint over the properties ended with the award.

Thor then sought protection under Section 9 of the Arbitration and Conciliation Act, 1996, pending its challenge to the award under Section 34.

It argued that the respondent’s only assets were the two properties and that it had sought no damages in the alternative.

Section 9 of the Arbitration and Conciliation Act, 1996 empowers the court to grant interim measures before, during, or after arbitration, subject to the requirements of a prima facie case, balance of convenience, and irreparable harm; an unsuccessful party seeking post-award relief faces a higher threshold, and relief is appropriate only in rare and compelling circumstances to prevent irreparable prejudice and preserve the efficacy of a Section 34 challenge (Home Care Retail Marts Pvt. Ltd. v. Haresh N. Sanghavi, 2026 INSC 415).

Under Delhi Airport Metro Express Pvt. Ltd. v. DMRC, (2022) 1 SCC 131, and Ssangyong Engineering v. NHAI, (2019) 15 SCC 131, a finding based on no evidence or reached by ignoring vital evidence may constitute perversity, but a court must not reappreciate evidence as if hearing an appeal.

The Specific Relief Act, 1963, as amended with effect from 1 October 2018, makes specific performance the general rule, subject to the statutory bars in Sections 11(2), 14 and 16; the former bar based on the adequacy of monetary compensation was removed.

Readiness and willingness under Section 16(c) requires proof of the claimant’s financial capacity and conduct.

The Court treated the alleged perversity only as a prima facie matter, not as a final determination under Section 34.

It noted that the tribunal’s reasons for calling the sanction letter a sham included the absence of loan details and supporting valuation or inspection material.

However, the letter specified the loan amount and facility, and PFL’s witness affirmed the sanction and PFL’s willingness to disburse the funds; the Court also noted that the respondent had not put to the witness any suggestion that the letter was forged, fabricated, or a sham.

On that limited basis, the Court considered the tribunal’s conclusion prima facie unsupported by evidence, without deciding whether the letter ultimately proved readiness and willingness.

The Court found the case sufficiently exceptional because the respondent’s only assets were the disputed properties, Thor sought specific performance without alternative damages, and alienation could frustrate the Section 34 proceedings.

The amended Specific Relief Act further supported preserving the properties while that challenge remained pending.

It restrained NYEQ Technologies from selling, alienating, creating third-party rights in, or encumbering either property until the next date of listing.

The respondent was permitted to file its reply within three weeks, with rejoinder within two weeks thereafter; the matters were listed for 2 December 2026.