High Court Enforces Undertaking to Complete Construction Under Arbitration Act Section 17 Order and Grants Site Access

The Petitioner filed a contempt petition alleging wilful disobedience of an interim order dated 24th June 2025, passed by a Sole Arbitrator under Section 17 of the Arbitration and Conciliation Act, 1996.

The Arbitrator had directed the Respondents to resume re-development and construction at the subject site per the Principal Collaboration Agreement.

Despite the High Court subsequently noting specific timelines for work in an order dated 25th February 2026, the Petitioner contended that the Respondents failed to comply.

The Respondents filed an affidavit on 11th July 2026 admitting the delay but stating that the building structure was complete and full completion would occur by March 2027.

Disputes also arose regarding the Petitioner’s access to the site.

1. Whether the Respondents committed wilful disobedience of the Court’s directions and the Arbitrator's Section 17 order regarding construction timelines.

2. Whether the Petitioner, as a co-owner, is entitled to access the construction site without interfering with the ongoing redevelopment.

The court exercised its jurisdiction under the Contempt of Courts Act, 1971, to ensure compliance with judicial orders and interim measures granted under Section 17 of the Arbitration and Conciliation Act, 1996.

The court relied on the principle of "holding a party bound to an undertaking" given to the court to ensure the time-bound performance of contractual obligations that have been reinforced by judicial orders.

It also balanced the property rights of a co-owner to access premises with the necessity of non-interference in construction activities.

The Court observed that although the Respondents failed to meet the initial timelines noted in the order dated 25th February 2026, they submitted an affidavit affirming that the primary structure was complete.

The Court accepted the Respondents' fresh undertaking to complete the entire project by 31st March 2027, thereby substituting the previous failed timelines with a final terminal date to which the Respondents are now legally bound.

Regarding the site access dispute, the Court noted the Petitioner's status as a co-owner and the Respondents' claim of interference; it resolved this by granting a right of access while simultaneously imposing a restrictive injunction against the Petitioner to prevent disruption of the works.

The Court specifically directed that the Petitioner be granted access to the premises at A-20, Mohan Cooperative Industrial Estate, New Delhi, subject to the condition that the Petitioner shall not interfere in the construction work being carried out by the Respondents.