Synopsis

HPCL terminated a retail outlet dealership agreement without giving the three months’ notice required under Clause 3 of the agreement. The dealer (Pooja Tripathi) challenged the termination. The arbitral tribunal held the termination null and void, restored the dealership, and awarded compensation for loss of profits from the date of takeover until restoration. HPCL filed a Section 34 petition. The Delhi High Court upheld the restoration of the dealership, finding that termination without the mandatory three months’ notice was illegal. However, the court set aside the compensation for loss of profits because the dealer had never made a specific claim for compensation in her pleadings – a statutory requirement under Section 21(5) of the Specific Relief Act. The court applied the doctrine of severability from Gayatri Balasamy to partially set aside only the compensation portion while upholding the rest of the award.

Court: High Court of Delhi

Coram: Hon’ble Mr. Justice Harish Vaidyanathan Shankar (Single Judge)

Date of Judgment: 4th May, 2026

Citation: O.M.P. (COMM) 22/2017 (unreported)

Core Law: Arbitration and Conciliation Act, 1996 – Section 34 (setting aside arbitral award), Section 28(3) (decision according to contract); Specific Relief Act, 1963 – Section 14 (contracts not specifically enforceable), Section 21(5) (compensation requires specific claim)

1. Heading of the judgment

High court of delhi

O.m.p. (comm) 22/2017

Hindustan petroleum corporation ltd (petitioner) vs. Pooja tripathi (deceased) through her l.rs. (respondent)

Coram: hon’ble mr. justice harish vaidyanathan shankar

Reserved on: 17th march, 2026; pronounced on: 4th may, 2026

2. Legal framework

Major laws and provisions involved:

Arbitration and conciliation act, 1996 – section 34 (petition for setting aside arbitral award), section 28(3) (arbitral tribunal to decide in accordance with terms of contract and trade usages), section 34(2)(b)(ii) with explanation 1 (public policy of india), section 34(2-a) (patent illegality)

Specific relief act, 1963 – section 14 (contracts not specifically enforceable – including contracts which are in their nature determinable), section 21(5) (no compensation awarded unless specifically claimed in plaint; amendment permissible)

Indian contract act, 1872 – section 73 (compensation for loss or damage)

Subject matter of the judgment:

Whether an arbitral award restoring a terminated dealership agreement can be set aside under Section 34 when the termination was effected without complying with the contractual notice period. Whether compensation for loss of profits can be awarded in the absence of a specific claim to that

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