News
Supreme Court Rejects Zostel’s Plea in OYO Arbitration Dispute
30 Jul 2025
- DMD Advocates
- Matter Reporting
The Hon’ble Supreme Court has refused to entertain Zostel’s special leave petition challenging the Delhi High Court’s ruling in the arbitration dispute between the parties.
The dispute originated after Oyo proposed to acquire Zostel’s hotel business, under which Zostel’s shareholders were to receive upto 7% equity stake in OYO. The arrangement was outlined in a largely non-binding term sheet, except for clauses relating to confidentiality, expenses, approvals, exclusivity, governing law, and arbitration, and contemplated subsequent steps including execution of definitive agreements.
An arbitral award dated March 6, 2021, in favour of Zostel was challenged by OYO under Section 34 of the Arbitration and Conciliation Act, 1996. The Delhi High Court subsequently set aside the award, inter alia, holding that granting specific performance in the absence of agreement on essential terms conflicted with the public policy of India.
In the SLP filed by Zostel, a Bench comprising Justices Sanjay Kumar and Satish Chandra Sharma observed that Zostel ought to have pursued the statutory appellate remedy under Section 37 of the Arbitration and Conciliation Act rather than approaching the Supreme Court under Article 136 of the Constitution.
OYO was represented by Senior Advocate Mukul Rohatgi and DMD Advocates, led by Anuradha Dutt, Lynn Pereira, Suman Yadav, Haaris Fazili, Kunal Dutt, Raghav Dutt, Avinash Singh, Keshav Sehgal, and Prachi Pandey.
