Navodaya Enterprises through Its Partner Mr. Naganand Hegde v. Tata Motorstata Motors Finance Solutions Limited Finance Solutions Limited

Bombay HC16 Apr 2026ARBP/76/2026

Case brief

AI extract

What is this about?

Unilateral appointment of sole arbitrator; Section 34 challenge to arbitral award; Navodaya Enterprises vs. Tata Motors Finance Solutions Limited; Arbitration Petition No. 76 of 2026, Bombay High Court Commercial Division; loan recall notice 13 February 2023; arbitration clause of loan cum hypothecation cum guarantee agreement dated 12 March 2021; Perkins Eastman Architects DPC & Another vs. HSCC (India) Ltd., AIR 2020 SC 59 relied upon; proceedings a nullity; award unenforceable; award quashed and set aside; petition allowed; interim applications disposed of.

What did the court decide?

Impugned arbitral award quashed and set aside; arbitration petition allowed. ¶¶22

Navodaya Enterprises through Its Partner Mr. Naganand Hegde vs… — Arbitration | Bombay HC (2026)

What the court decided

AI extract

Outcome

Impugned arbitral award quashed and set aside; arbitration petition allowed.

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Issue for consideration

Whether the arbitral award is invalid solely because the arbitrator was unilaterally appointed by the respondent.

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Court's answer

A person having interest in the outcome of the dispute is ineligible not only to act as an arbitrator but is also rendered ineligible to appoint an arbitrator (asserted by this Court as well settled, relying on Perkins Eastman Architects DPC & Another vs. HSCC (India) Ltd., AIR 2020 SC 59).

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Ratio / Principle

Arbitral proceedings resulting from a unilateral appointment of the arbitrator are a nullity and the award is unenforceable in law; accordingly, the impugned award was quashed and set aside and the petition allowed.

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Detailed headnote1 paragraphs

Single-judge decision (Sharmila U. Deshmukh, J.) of the Bombay High Court, Commercial Division, allowing an Arbitration Petition under Section 34 of the Arbitration and Conciliation Act, 1996 filed by Navodaya Enterprises against Tata Motors Finance Solutions Limited. The sole objection to the arbitral award passed by a sole arbitrator (dated 4th August, 2022 per judgment para 1; stated as 4th October, 2022 in judgment para 4) was its unilateral appointment: the Respondent's loan recall notice of 13th February, 2023 declared that it would nominate and appoint the sole arbitrator as per the arbitration clause of the loan cum hypothecation cum guarantee agreement dated 12th March, 2021 (agreement not produced on record), and Respondent's counsel conceded the appointment was unilateral. Relying on Perkins Eastman Architects DPC & Another vs. HSCC (India) Ltd. (AIR 2020 SC 59), the Court held that a person having interest in the outcome of the dispute is ineligible to act as an arbitrator or to appoint one, that proceedings resulting from unilateral appointment are a nullity and the award unenforceable in law, and accordingly quashed and set aside the impugned award. Interim Applications were disposed of as not surviving for consideration.

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50-ARBP-76-2026.doc

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION

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IN ITS COMMERCIAL DIVISION

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ARBITRATION PETITION NO. 76 OF 2026 WITH INTERIM APPLICATION (L) NO. 23096 OF 2023 WITH INTERIM APPLICATION NO. 1222 OF 2026 IN

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ARBITRATION PETITION NO. 76 OF 2026

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Navodaya Enterprises Through Its Partner Mr. Naganand Hegde

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...Petitioner

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Versus

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Tata Motorstata Motors Finance Solutions Limited ...Respondent Finance Solutions Limited

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Mr. Mohammed Zain Khan a/w Mr. Ashraf Kapoor i/b One Legal, for the Petitioner.

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Mr. Gaurav Jangle a/w Ms. Kunjita Shah, Mr. Siddhant Dalvi, for the Respondent.

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——————

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CORAM : SHARMILA U. DESHMUKH, J. DATE : April 16, 2026

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P. C. :

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1. By the present Arbitration Petition filed under Section 34 of Arbitration and Conciliation Act, 1996 challenge is to the impugned Award dated 4^th August, 2022 passed by the learned sole arbitrator.

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2. The sole objection which raised to the validity of the impugned Arbitral Award is the unilateral appointment of the arbitrator. The Respondent had issued loan recall notice for termination of agreement /contract on 13^th February, 2023 in which it was stated that the

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1 of 2

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Arya

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50-ARBP-76-2026.doc

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Respondent would nominate and appoint sole arbitrator to arbitrate the dispute as per the arbitration clause of the loan cum hypothecation cum guarantee agreement dated 12^th March, 2021. The arbitrator appears to have been appointed under the clause of the said agreement. The loan cum hypothecation cum guarantee agreement is not produced on record, however, learned counsel for the Respondent would fairly concede that it was a case of unilateral appointment. It is by virtue of the said clause that the Respondent nominated the sole arbitrator.

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3. It is well settled by the Hon'ble Apex Court in the case of Perkins Eastman Architects DPC & Another vs. HSCC (India) Ltd.¹ that the person having interest in the outcome of dispute is ineligible not only to act as an arbitrator but is also rendered ineligible to appoint an arbitrator. Such proceedings being the result of a unilateral appointment are a nullity and the Award is unenforceable in law.

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4. In light of the above, the impugned Award dated 4^th October, 2022 is hereby quashed and set aside. Petition is allowed.

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5. Interim Applications do not survive for consideration and stands disposed of.

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[SHARMILA U. DESHMUKH, J.]

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1 AIR 2020 SC 59

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Arya

Navodaya Enterprises through Its Partner Mr. Naganand Hegde v. Tata Motorstata Motors Finance Solutions Limited Finance Solutions Limited

Case brief

What is this about?

What did the court decide?

Navodaya Enterprises through Its Partner Mr. Naganand Hegde v. Tata Motorstata Motors Finance Solutions Limited Finance Solutions Limited

Case brief

What is this about?

What did the court decide?

Why is it important?

What the court decided

Issues for consideration

Cases cited

Statutes considered

Procedural history

Parties & counsel

Coram

Case details

All orders in this case

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