Tricolor Hotels Limited v. Dinesh Jain 2025 INSC 1132 - S.15(2) Arbitration Act - Delay Condonation

Case Name and Neutral Citation

• Case Name: Tricolor Hotels Limited v. Dinesh Jain & Ors.
• Neutral Citation: 2025 INSC 1132
• Case Number: SLP (C) No. 4008 of 2023

Coram

• Coram:
• • Justice Pamidighantam Sri Narasimha
  • Justice Atul S. Chandurkar

Judgment Date

• Date of Judgment: 19 September 2025

Caselaws and Citations Referred

1. National Highways Authority of India & Anr. v. Bumihiway DDB Ltd. (JV) & Ors.Citation: (2006) 10 SCC 763
2. Huawei Technologies Company Limited v. Sterlite Technologies LimitedCitation: (2016) 1 SCC 721
3. Government of Maharashtra (Water Resources Department) v. Borse Brothers Engineers and Contractors Private LimitedCitation: 2021 INSC 194
4. SAP India Private Limited v. Cox & Kings LimitedCitation: 2019:BHC-0S:9221 (Bombay High Court)
5. Basawaraj & Anr. v. Special Land Acquisition OfficerCitation: (2013) 14 SCC 81
6. Bharat Sanchar Nigam Limited & Anr. v. Nortel Networks India Private LimitedCitation: 2021 INSC 175
7. HPCL Bio-Fuels Ltd. v. Shahaji Bhanudas BhadCitation: 2024 INSC 851
8. Pritam Singh v. StateCitation: (1950) SCC 189

Statutes/Laws Referred

• Arbitration and Conciliation Act, 1996
• • Section 11 (Appointment of arbitrators)
  • Section 15(2) (Termination of mandate and substitution of arbitrator)
• Limitation Act, 1963
• • Article 137 (Period of limitation for applications)
• Constitution of India
• • Article 136 (Special Leave to appeal by the Supreme Court)

Q&A on Tricolor Hotels Limited v. Dinesh Jain & Ors. (2025 INSC 1132)

1. What was the main issue before the Supreme Court?

• Whether the delay in filing a petition under Section 15(2) of the Arbitration and Conciliation Act, 1996 for substitution of an arbitrator should be condoned, and whether the High Court was correct in refusing to condone such delay.

2. What were the relevant facts leading to the dispute?

• Parties entered into share purchase agreements with an arbitration clause. A sole arbitrator was appointed in 2010. The arbitrator recused himself on 27.07.2015 via email. The petitioner filed for substitution of the arbitrator on 01.08.2018 and later sought condonation of delay. The High Court refused to condone the delay.

3. What statutory provisions were involved?

• Arbitration and Conciliation Act, 1996: Section 15(2) (substitution of arbitrator), Section 11 (appointment of arbitrator)
• Limitation Act, 1963: Article 137 (three-year limitation for applications)
• Constitution of India: Article 136 (Special Leave Petition jurisdiction)

4. What was the petitioner’s argument regarding limitation?

• The petitioner argued that the limitation period started when they actually received knowledge of the arbitrator’s recusal (second week of August 2015), not the date of the email (27.07.2015). They claimed the application was within the three-year period under Article 137 of the Limitation Act.

5. How did the petitioner justify the delay?

• The petitioner claimed a technical glitch prevented their counsel from accessing the email immediately, and that the delay (five days) was minor and should be condoned in the interest of justice and expeditious arbitration.

6. What was the respondents’ position?

• The respondents argued that the right to apply for substitution accrued on the date of the arbitrator’s recusal (27.07.2015), not when the petitioner accessed the email. They contended that no sufficient cause was shown for the delay and that the petitioner was not diligent.

7. What did the High Court decide?

• The High Court found no sufficient cause for the delay, noting the explanation was ambiguous and the proceedings had already been long drawn. It refused to condone the delay.

8. What legal principles did the Supreme Court apply?

• The Supreme Court emphasized that condonation of delay requires “sufficient cause.” Discretion to condone delay is not automatic and must be exercised judiciously, especially in arbitration matters where expeditious resolution is a key objective.

9. Did the Supreme Court find any error in the High Court’s decision?

• No. The Supreme Court held that the High Court’s refusal to condone the delay was neither perverse nor resulted in manifest injustice. No special circumstances warranted interference under Article 136.

10. What was the final outcome?

• The Supreme Court dismissed the Special Leave Petition, upholding the High Court’s order refusing to condone the delay in filing the petition under Section 15(2) of the Arbitration and Conciliation Act, 1996.