Disposal of Contempt Petitions with Liberty to Seek Relief Before Arbitrator for Non-Payment of License Fees

The Petitioner, Delhi Metro Rail Corporation (DMRC), filed contempt petitions against the Respondents regarding disputes arising from a licensing agreement.

In previous proceedings dated 27.04.2026, the High Court noted the background of the matter

Parallelly, arbitral proceedings were ongoing where the learned Arbitrator considered the dispute on 27.04.2026

and subsequently passed an order on 04.05.2026

The Arbitrator’s order disposed of an application filed by Respondent No. 1 under Section 17 of the Arbitration and Conciliation Act, 1996, granting certain interim protection to the Respondents

DMRC contended that despite this protection, the Respondents failed to pay the requisite arrears of the license fee

1. Whether the contempt petitions should be maintained or continued in light of the interim orders passed by the learned Arbitrator under Section 17 of the Arbitration and Conciliation Act

The Court primarily considered the application of Section 17 of the Arbitration and Conciliation Act, 1996, which empowers an Arbitral Tribunal to grant interim measures of protection during the pendency of arbitral proceedings

It further applied the principle of judicial restraint in contempt jurisdiction when specialized alternative remedies (arbitral proceedings) are actively seized of the subject matter and have passed substantive interim orders addressing the grievances

The Court observed that the core of the dispute—specifically the protection of the Respondents' interests and the corresponding obligation to pay license fee arrears—had transitioned into the domain of the Arbitral Tribunal

Since the Arbitrator had already exercised jurisdiction under Section 17 and passed a specific order on 04.05.2026 disposing of the interim application, the High Court determined that the appropriate forum for seeking enforcement of payments or modification of interim protection was the Arbitral Tribunal itself

The Court reasoned that rather than adjudicating contempt, the Petitioner should be granted the liberty to apprise the Arbitrator of any non-compliance regarding the "requisite amount/s" the Respondents were obliged to pay

By directing the Arbitrator to decide such applications on their own merits, the Court ensured that the arbitral process remained the primary vehicle for resolution

It held that the Petitioner is at liberty to move an appropriate application before the learned Arbitrator regarding the Respondents' failure to pay arrears of the license fee

The Court directed the Arbitrator to decide such applications independently and on their own merits, unaffected by the High Court's present order