Woodland (Aero Club) Pvt. Ltd. won an appeal against M/S. Ambience Commercial Developers Pvt. Ltd. because the arbitration was against the wrong party. Let's break down the details of this case.
Woodland signed a lease on March 17, 2011, with Ambience Development & Infrastructure Pvt. Ltd. (ADIPL) for a store space in Ambience Mall, Gurgaon. The lease was for nine years. Woodland paid a security deposit of ₹22,84,922.
On November 6, 2015, Woodland decided to end the lease and left by March 5, 2016. They asked for a refund of ₹18,73,812 after deductions.
When ADIPL didn’t return the security deposit, Woodland started arbitration on September 15, 2016. However, they mistakenly filed against Ambience Commercial Developers Pvt. Ltd. (ACDPL) instead of ADIPL. The arbitrator, Shri Brajesh Kumar, was chosen by ADIPL.
“The appellant mentioned the name ‘M/s Ambience Commercial Developers Pvt. Ltd.’ as respondent instead of ADIPL.”
The arbitrator decided against Woodland, saying they filed against the wrong party. The arbitrator also noted that Woodland did not prove their Senior Manager was allowed to act for them.
Woodland challenged the arbitration decision in the District Court. However, the court agreed with the arbitrator's decision on May 31, 2024, saying Woodland had sued the wrong party.
Woodland then appealed under Section 37 of the Arbitration and Conciliation Act. Judges Vinod Kumar and V. Kameswar Rao ruled in favor of Woodland on December 2, 2025.
Wrong Party Involved: The arbitration was conducted with ACDPL, not ADIPL, who was the actual party to the lease.
One-Sided Arbitrator Appointment: The arbitrator was chosen by ADIPL, which is against the rules as per recent judgments.
“The Arbitrator was de jure ineligible as he was appointed unilaterally by ADIPL.”
The High Court canceled the previous judgments and the arbitration decision, allowing Woodland's appeal. This case shows how important it is to correctly identify parties in legal agreements and disputes.
