In a significant judgment conveyed on October 8, 2024, the Delhi High Court set aside an assertion grant within the case of FLFL Travel Retail Lucknow Pvt. Ltd. versus the Airports Authority of India (AAI), citing infringement of characteristic justice and procedural abnormalities amid the discretion procedures. The Court permitted the appeal beneath Segment 34 of the Arbitration and Conciliation Act, 1996, and set aside the arbitral grant dated August 11, 2022.
Case Background
The debate between FLFL Travel Retail and AAI emerged from a Concession Agreement dated March 23, 2018, related to the advancement, marketing, and administration of retail outlets at different airplane terminals, counting the Chaudhary Charan Singh Airport in Lucknow. FLFL Travel Retail had looked for a discount on the concession expenses due to delays in getting security clearances and closure of the visitors' zone at the Lucknow Air terminal.
The mediator, within the grant, allowed as it were fractional alleviation to FLFL Travel Retail, granting them roughly ₹20 lakhs in harms, much lower than the claims raised by the company. The company recorded a appeal challenging the grant, charging procedural infringement and predisposition by the mediator.
Key Matters
Two significant problems with the arbitration procedure were noted by the High Court: Failed to Declare Conflict of Interest: Throughout the proceedings, the arbitrator took an additional appointment from AAI in a different arbitration without notifying FLFL Travel Retail.
The Arbitration and Conciliation Act's Section 12, which requires arbitrators to reveal any past or current associations that would cast doubt on their impartiality, was deemed to have been broken by the Court.
Non-Supply of Key Documents:
The Court moreover found that the arbitrator had gotten records from AAI amid the pendency of the procedures, which were not instantly shared with the applicant. These archives, which were basic to the case, were sent to FLFL Travel Retail only days before the ultimate grant was issued, leaving them inadequate time to reply. This, the Court ruled, abused Area 24(3) of the Arbitration Act, which guarantees that all parties have the opportunity to reply to prove presented amid assertion.
Court's Conclusion
After looking into the realities, the Court concluded that the discretion prepare had been compromised due to the arbitrator's non-disclosure and the disappointment to take after appropriate methods for sharing records. Equity Jalan ruled that these infringement undermined the standards of common equity and set aside the discretion grant. The Court allowed the parties freedom to seek after other cures as permitted beneath the law.
Click Here to: Download/View Related File
TAGS: Delhi High Court arbitration award FLFL Travel Retail Airports Authority of India Section 34 conflict of interest procedural irregularities natural justice.
