Oyo Hotels and Homes Pvt Ltd has approached the Delhi High Court to challenge parts of an arbitration award in its lease dispute with eyewear retailer Lenskart Solutions Pvt Ltd, reported Bar and Bench. The case concerns the early termination of a coworking space lease during the COVID-19 pandemic.
The petition came up on Tuesday before Justice Amit Bansal, who issued notice to Lenskart and sought its response. Oyo, which had partially succeeded in arbitration, is seeking to set aside the award’s findings on three issues: compensation for the lease’s lock-in period, the award of interest, and certain observations on stamp duty.
From six-year lease to early exit
The dispute began with a July 30, 2019 lease agreement under which Lenskart (then known as Alcott Town Planners Pvt Ltd) rented the first floor of Subharam Complex on MG Road, Bengaluru, from Oyo. The lease was for six years, with a 36-month lock-in period.
In March 2020, soon after the pandemic began, Lenskart stopped paying rent for 15 days, citing force majeure. On May 24, 2020, it terminated the lease and sought a Rs 1.21 crore security deposit refund.
Oyo claimed the termination was unlawful and premature, demanding over Rs 7.8 crore for the unexpired lock-in period along with late payment charges.
A sole arbitrator was appointed in September 2021 by the Delhi High Court. After prolonged hearings, the tribunal ruled that COVID-19 did not trigger the lease’s force majeure clause, which only applied if the premises were damaged or destroyed.
While this finding supported Oyo, the arbitrator still reduced its lock-in compensation and made rulings on interest and stamp duty that Oyo disputes. The company, represented by DMD Advocates, now wants the High Court to overturn those parts of the award.
What this means
In plain terms, Oyo partly won in arbitration but didn’t get as much money as it wanted — and some rulings went against it. Now it’s asking the court to tweak or remove those parts of the decision. The High Court won’t redo the entire case but can modify or strike down parts of the award if it finds legal errors or procedural flaws.