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Flemingo (DFS) Private Limited vs. Airports Authority of India

Arbitration Petition · 2026:DHC:7608Decided 7 Sept 2026New Delhi Bench
ARB.P. 853/2025CNR: DLHC010360382025
Justice Jasmeet Singh

Background

A duty-free shop operator at Amritsar Airport had a long-running dispute with the Airports Authority of India (AAI) over alleged excess rent, royalty, and concession fees charged under a 2011 licence agreement. The operator sent several letters from 2017 requesting resolution, but AAI only formally rejected the claims in 2021. After failed attempts at mediation through 2023, the operator sought court-appointed arbitration in 2025. AAI opposed the petition, arguing it was filed too late and that some claims fell outside the arbitration clause altogether.

Decision Breakdown

The Court held that at this preliminary stage, its job is only to check that a valid arbitration agreement exists and that the petition itself was filed within the legal time limit, not to decide whether the underlying claims are themselves too old, which is for the arbitrator to determine. The Court found the early letters (2017-2018) were not true "notices invoking arbitration" since they merely requested a resolution and warned of arbitration only as a future possibility; the real "breaking point" for limitation purposes was when AAI actually rejected the claims in October 2021. Since a formal notice invoking arbitration followed in March 2022, and the subsequent months spent in genuine mediation (encouraged by AAI's own policy) are excluded from the limitation clock, the petition was filed in time. An arbitrator was appointed, leaving all merits, including whether one of the disputed items falls within the arbitration clause, to be decided in arbitration.

Lesson Learnt

A letter merely requesting resolution and warning that arbitration "may" follow is not the same as formally invoking arbitration; and time spent in good-faith settlement talks or mediation, especially where the other party itself proposed it, is excluded when calculating whether a court arbitration petition was filed within the legal time limit.

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