The Supreme Court has held that a party who abandons arbitral proceedings cannot subsequently initiate a fresh application for appointment of an arbitrator on the same cause of action, without prior liberty from the court.

The bench of Justice Pamidighantam Sri Narasimha and Justice Alok Aradhe has quashed a Punjab and Haryana High Court order that had allowed a fresh Section 11 application under the Arbitration and Conciliation Act, 1996.

The dispute arose out of a joint business transaction between the appellant, Rajiv Gaddh, and the respondent, Subodh Parkash, involving the purchase of land in Hoshiarpur, Punjab. The parties had entered into multiple agreements in 2013 governing their financial arrangements, shareholding, and obligations, all of which contained an arbitration clause.

Following disputes, the respondent invoked arbitration in 2015, leading to the appointment of multiple arbitrators over time. However, during the proceedings, the respondent stopped participating, alleging bias and ultimately communicating his refusal to continue with the arbitration.

Despite being granted opportunities, the respondent failed to pursue his claims, leading the arbitral tribunal to proceed and pass an award in 2020.

In 2021, the respondent issued a fresh notice invoking arbitration, claiming a new cause of action based on a prior Supreme Court judgment upholding the validity of the land auction. He subsequently filed a fresh Section 11 application seeking appointment of an arbitrator.

The High Court allowed this application, holding that issues such as res judicata could be decided by the arbitral tribunal rather than at the appointment stage.

Setting aside the High Court’s decision, the Supreme Court held that the respondent had clearly abandoned the earlier arbitration proceedings, as evidenced by his refusal to participate. The subsequent application was based on the same cause of action, and no new rights had arisen from the earlier Supreme Court judgment concerning the auction. The principles of Order 23 Rule 1 of the Code of Civil Procedure, 1908, which bar fresh proceedings after withdrawal or abandonment without court permission, apply equally to Section 11 applications.

The Court emphasized that allowing such repeated attempts would amount to an abuse of the judicial process and undermine finality in dispute resolution.

Case Details

Case Title: Rajiv Gaddh Versus Subodh Parkash

Citation: JURISHOUR-583-SC-2026

Case No.: SLP (C) No. 4430 OF 2025

Date: 01/04/2026

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