The Delhi High Court has ruled that a party who acknowledges an arbitral award through WhatsApp and subsequently participates in its implementation cannot later dispute the award by claiming that a signed copy was never formally served.
The ruling came while the Court dismissed a petition filed under Section 34 of the Arbitration and Conciliation Act, 1996, challenging an interim arbitral award arising out of a family property dispute involving the Mawandia family.
The petitioner argued that the challenge was maintainable because he had never received a signed copy of the arbitral award as contemplated under the Arbitration Act. According to him, he became aware of the award only after execution proceedings were initiated, and therefore the limitation period had not commenced earlier.
The Court, however, found the record painted an entirely different picture.
The arbitral award had been shared in a WhatsApp group created specifically for resolving disputes among members of the family. Soon after the document was uploaded, the petitioner replied to the message with the words, “Noted thanks.”
The High Court held that this acknowledgement was not an isolated or casual response. It was followed by sustained discussions among the family members regarding the practical implementation of the award, with the petitioner actively participating throughout.
The Court observed that the petitioner engaged in conversations concerning gift deeds, transfer documents, bank no-objection certificates, removal of movable assets from the properties, and other steps necessary to give effect to the arbitral award. He also proposed modifications to draft documents and laid down conditions for execution of transfer deeds.
In these circumstances, the Court concluded that the petitioner had consciously accepted the existence of the award and acted upon it without raising any objection.
The dispute traces back to a family business operated jointly by the Mawandia brothers. A Memorandum of Understanding was executed in 2019 to divide family and group-company properties. Differences later surfaced, leading the parties to enter into an arbitration agreement in June 2021.
An interim arbitral award was delivered on November 13, 2021, dealing with two disputed properties. While two brothers initiated execution proceedings to enforce the award, the petitioner approached the High Court in 2024 seeking to have it set aside.
Apart from questioning service of the signed award, the petitioner also contended that the award affected the rights of a family member who was not a party to the arbitration agreement and argued that only two of the three arbitrators had signed the award.
The High Court rejected these objections.
It held that once a party has accepted an arbitral award as a consensual resolution of disputes and has taken concrete steps towards implementing it, that party cannot later adopt a contradictory stand merely because circumstances have changed.
The Court further observed that consensual arbitral awards deserve a high degree of finality and cannot be reopened in the absence of factors such as fraud, coercion or other circumstances that would invalidate the settlement.
On the question of limitation, the Court held that the petitioner had full knowledge of the award in November 2021, acknowledged its receipt through WhatsApp, and participated in discussions aimed at implementing it. Having waited until execution proceedings commenced before filing the challenge, the petition was found to be hopelessly time-barred.
Accordingly, the High Court dismissed the petition.
