The Supreme Court of India on 20 November 2025 delivered a significant ruling concerning the execution of an arbitral award that had been the subject of prolonged international and domestic litigation within the Dalal family. The Court set aside two orders of the Bombay High Court that had stayed the execution of a 2010 arbitral award and held that the High Court’s Division Bench had wrongly entertained Letters Patent Appeals (LPAs) filed by the judgment debtor’s legal heirs.
Background of the Dispute
The case originated in a long-running family business dispute between Bharat Kantilal Dalal (the appellant) and his father, Kantilal Dalal. An arbitral award dated 12 July 2010 was passed in favour of the appellant by a sole arbitrator. The father, who later died in 2013, had contested the award but never filed a challenge under Section 34 of the Arbitration and Conciliation Act, 1996.
The award was thereafter taken for enforcement to multiple jurisdictions, including Dubai and Singapore, where foreign courts recognised the award and held the father liable for approximately USD 12.95 million. However, the award remained unfulfilled.
Following the father’s death, the appellant initiated execution proceedings in the Bombay High Court seeking enforcement of the award against the father’s estate. The father’s brother — who was also executor and beneficiary under a Will dated 16 September 1994 — opposed the execution, claiming that he was not bound by the arbitral award.
Orders of the Single Judge
On 18 December 2014, the Bombay High Court’s Single Judge passed two orders:
- Allowed execution to proceed, directed issuance of notice under Order 21 Rule 22 CPC, and restrained creation of third-party rights in certain properties.
- Rejected objections filed by the uncle, holding that the award had attained finality and could not be declared a nullity.
High Court’s Division Bench Intervention
In 2018, a Division Bench admitted LPAs against these orders and stayed the execution, despite serious questions about whether such appeals were maintainable in matters arising under the Arbitration Act — which is widely recognised as a self-contained code, restricting appellate interference.
Supreme Court’s Key Findings
The Supreme Court held:
- LPAs were not maintainable.
Since the orders related to execution of an arbitral award, they were traceable to the Arbitration and Conciliation Act, not the Civil Procedure Code. The Act does not permit LPAs against such orders. - Respondents were legal representatives, not strangers.
They were impleaded in their capacity as executors and beneficiaries of the deceased judgment debtor’s estate and could not claim to be outsiders to the execution. - Order 21 Rule 22 CPC notice is mandatory.
The Court emphasized that no execution against legal representatives can proceed without issuing statutory notice.
The Single Judge had not yet issued this notice; therefore, the respondents’ right to raise objections under Order 21 Rule 23(2) must be preserved. - Single Judge’s earlier observations could prejudice respondents.
The Supreme Court held that certain findings recorded while deciding premature chamber summons should not influence consideration of objections that the legal heirs may raise once notice is formally served.
Final Directions Issued
The Supreme Court:
- Quashed and set aside the Bombay High Court’s Division Bench orders dated 06 March 2018.
- Dismissed the LPAs as not maintainable.
- Directed the Single Judge to:
- Issue notice under Order 21 Rule 22 CPC to all respondents;
- Allow them to file objections under Order 21 Rule 23(2);
- Consider such objections strictly on merits, uninfluenced by earlier observations.
Significance of the Judgment
- Reinforces that the Arbitration and Conciliation Act is a complete code with strict limits on appeals.
- Restores procedural fairness for legal heirs against whom execution is sought.
- Clarifies that execution of foreign-recognised arbitral awards must proceed strictly according to statutory requirements.
- Prevents premature adjudication on merits before respondents receive mandatory notice.
The judgment provides clarity on the interface between the Arbitration Act and CPC execution provisions and strengthens India’s commitment to enforcing arbitral awards efficiently while ensuring procedural fairness.
Case: Bharat Kantilal Dalal (Dead) through LR v. Chetan Surendra Dalal & Others
Date of Decision: 20 November 2025
Court: Supreme Court of India