Aditya Birla Finance Limited vs Nakula Prusty — Arbitration | Bombay HC (2026)

Aditya Birla Finance Limited vs Nakula Prusty — Arbitration | Bombay HC (2026)

What the court decided

AI extract

Outcome

Arbitral awards set aside; Execution Applications and connected Interim Applications dismissed/disposed; parties free to initiate fresh arbitration in accordance with law; period from invocation of arbitration till the date of the order excluded for limitation; liberty to apply preserved where an express written agreement waives the sole arbitrator's ineligibility or right to object under Section 12(5).

Issue for consideration

Whether arbitral awards flowing from a unilateral appointment of the arbitrator are liable to be set aside when the objection is raised at the execution stage. +2 more

Court's answer

The arbitral awards in these matters are set aside on account of the unilateral appointment of the arbitrator, and the Execution Applications as well as the connected Interim Applications stand dismissed/disposed.

Ratio / Principle

It is open to the parties to initiate fresh arbitration proceedings in accordance with law.

Key takeaways

For limitation, the period from the invocation of the arbitration till the date of this order stands excluded for initiating fresh arbitration proceedings.ratio¶¶31
Liberty to apply is reserved where an express agreement in writing exists, in terms of the proviso to Section 12(5) of the Arbitration and Conciliation Act, 1996, waiving the ineligibility of the sole arbitrator or the right to object under Section 12(5).ratio¶¶32

Detailed headnote1 paragraphs

Bombay High Court, OOCJ (Abhay Ahuja, J., 20 April 2026): In twelve Interim Applications in Execution Applications moved by Aditya Birla Finance Limited, the Court — acting on the Supreme Court's decision in Bhadra International (India) Pvt. Ltd. v. Airports Authority of India, 2026 SCC OnLine SC 7, that unilateral appointment of an arbitrator is void ab initio and the ineligibility can be raised even at the execution stage — set aside the arbitral awards and dismissed/disposed of the Execution Applications and connected Interim Applications. Parties left free to initiate fresh arbitration; the period from invocation of arbitration till the date of the order excluded for limitation; liberty to apply reserved where an express agreement in writing waives the sole arbitrator's ineligibility or the right to object under the proviso to Section 12(5), Arbitration and Conciliation Act, 1996.

46 to 57.doc

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

INTERIM APPLICATION NO. 2325 OF 2025 IN

EXECUTION APPLICATION NO. 2386 OF 2025

Aditya Birla Finance Limited … Applicant Versus Babu G … Respondents

AND INTERIM APPLICATION NO. 2327 OF 2025 IN

EXECUTION APPLICATION NO. 2389 OF 2025 AND INTERIM APPLICATION NO. 2328 OF 2025 IN EXECUTION APPLICATION NO. 2263 OF 2025 AND INTERIM APPLICATION NO. 2330 OF 2025

IN EXECUTION APPLICATION NO. 2272 OF 2025 AND INTERIM APPLICATION NO. 2332 OF 2025

IN

EXECUTION APPLICATION NO. 2400 OF 2025 AND INTERIM APPLICATION NO. 2333 OF 2025

IN

EXECUTION APPLICATION NO. 2399 OF 2025 AND

INTERIM APPLICATION NO. 2344 OF 2025

IN

EXECUTION APPLICATION NO. 2171 OF 2025 AND

INTERIM APPLICATION NO. 2345 OF 2025 IN

Digitally
signed by
NIKITA
NIKITA YOGESH
YOGESH GADGIL
GADGIL Date:
2026.04.21
20:43:20
+0530

EXECUTION APPLICATION NO. 2422 OF 2025 AND INTERIM APPLICATION NO. 2346 OF 2025 IN

Mandar M. 1/3

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EXECUTION APPLICATION NO. 2280 OF 2025 AND INTERIM APPLICATION NO. 2347 OF 2025 IN EXECUTION APPLICATION NO. 2420 OF 2025 AND INTERIM APPLICATION NO. 2348 OF 2025 IN EXECUTION APPLICATION NO. 2267 OF 2025 AND INTERIM APPLICATION NO. 2349 OF 2025 IN EXECUTION APPLICATION NO. 2349 OF 2025

Ms. Vedika Pedhambkar i/b. Akhil Modi and Associates, Advocate for Applicant.

CORAM : ABHAY AHUJA, J. DATE : 20^th April 2026

PC:-

Ms. Pedhambkar, learned Counsel appears for the Applicant in these matters and submits that in these matters there has been a unilateral appointment of Arbitrator and this Court may pass appropriate orders in view of the decision in the case of Bhadra International (India) Pvt. Ltd. and others vs. Airports Authority of India¹ , where the Hon’ble Supreme Court has clearly observed that unilateral appointment of arbitrator is void ab initio and the ineligibility can be raised at any stage and even in execution.

1 2026 SCC OnLine SC 7.

Mandar M. 2/3

46 to 57.doc

In view of the aforesaid, the arbitral awards are set aside and the Execution Applications as well as the connected Interim Applications stand dismissed/disposed.

It would be open to the parties to initiate fresh arbitration proceedings in accordance with law.

As far as limitation is concerned, the period from the invocation of the arbitration till today be excluded in initiating fresh arbitration proceedings.

Liberty to apply in the event there exists an express agreement in writing in terms of proviso to Section 12(5) of the Arbitration and Conciliation Act, 1996 (the “said Act”) waiving the ineligibility of the sole arbitrator or the right to object under Section 12(5) of the said Act.

(ABHAY AHUJA, J.)

Mandar M. 3/3