Parties: M/S LANCOR HOLDINGS LIMITED vs. PREM KUMAR MENON
Lawyers: PRAGYA BAGHEL
Judges: JUSTICE SANJAY KUMAR, JUSTICE ALOK ARADHE
Decision By: JUSTICE SANJAY KUMAR
Case Number: 6448/2019
Summary: A court case between M/s Lancor Holdings Limited and Prem Kumar Menon has brought attention to issues with delayed arbitration and unfinished construction agreements in Chennai. The Supreme Court got involved to settle the long-standing dispute, stressing the importance of quick and effective arbitration.
In 2004, M/s Lancor Holdings Limited (Lancor) made a deal with Prem Kumar Menon and others to build on a piece of land in Chennai. The plan was simple: Lancor would construct a building, and both parties would share the finished space equally. However, things didn't go as planned.
Lancor said the building was finished by October 2008, backed by a certificate from the Project Architect. But the Menons disagreed, pointing out incomplete areas like the staircase and basement. This disagreement led Lancor to create sale documents for itself using a photocopy of a power-of-attorney, which was supposed to be safely kept with a third party.
When the Menons refused to return security deposits, Lancor requested arbitration in January 2009, choosing Justice K.P. Sivasubramaniam as the arbitrator. However, the arbitration faced delays, and the decision wasn't made until March 2016, almost four years later. The arbitrator's inability to make a clear decision left both parties without a solution, leading to more legal battles.
"The arbitrator took nearly 4 years to conclude that he had no fair solution for both parties but ruled in favor of one side completely."
Lancor's appeal led to a Supreme Court decision on October 31, 2025, where Justice Sanjay Kumar and Justice Satish Chandra Sharma pointed out the arbitration's failure to solve the main issues. They noted that the arbitration process should be quick and efficient, not leaving parties stuck without a solution.
The Supreme Court used its authority to end the dispute. It confirmed the contested sale documents but penalized Lancor for its earlier actions by taking away the security deposits. Additionally, Lancor was ordered to pay ₹10 crores to the Menons for finishing the building and other costs.
This case highlights the importance of timely arbitration and clear agreements. The long legal battle shows the need for arbitrators to make decisive and fair decisions to avoid unnecessary court cases.
"The main goal of arbitration is to settle disputes with minimal court involvement."
This case serves as a reminder that arbitration should be a quick and effective way to resolve disputes, ensuring justice and fairness for everyone involved.
