Best Award Passed Without Your Knowledge? Remedies Against a One-Sided Award Lawyer

Many people learn about an arbitration only when their bank account is frozen, a recovery agent arrives, or an execution notice reaches their office. By then an award has already been passed, in a case they never knew about, before an arbitrator they never agreed to. This kind of award is often called an "ex-parte" award. In plain words, it is a one-sided award: one side took part, the other did not.

This page is for borrowers, guarantors, small businesses and individuals in that position. The good news is that the law takes lack of notice and one-sided arbitrators seriously. An award can be set aside if you were not given proper notice of the arbitrator's appointment or the proceedings, or if the tribunal was not properly constituted. The time to challenge usually runs from when you actually received the signed award, not from when it was signed.

The bad news is that delay hurts. Once you know about the award, every week counts. Collect what you have, and get advice quickly.

Is this your situation?

Why one-sided awards are vulnerable

How courts look at unilateral appointments

The Supreme Court has built this protection over several years. In TRF v Energo Engineering (2017), it held that a person who is ineligible to be an arbitrator cannot nominate one either. In Perkins Eastman v HSCC (2019), it extended this: a party with an interest in the outcome cannot appoint a sole arbitrator on its own. In Bharat Broadband v United Telecoms (2019), it held that the ineligibility under Section 12(5) can be waived only by an express agreement in writing made after the dispute arises; taking part in the proceedings is not enough.

In November 2024, a five-judge bench in Central Organisation for Railway Electrification v ECI-SPIC-SMO-MCML held that clauses allowing one party to unilaterally appoint a sole arbitrator, or to control the panel from which the tribunal is chosen, offend the principle of equal treatment under Section 18 and Article 14 of the Constitution. The bench said its decision would apply to appointments made after the date of the judgment, though the earlier Perkins Eastman rule on sole arbitrators already applied before.

In September 2026, in Arth Micro Finance v Shivalik Small Finance Bank, the Supreme Court set aside orders freezing accounts and moving funds that were passed while the borrowers' objection to the tribunal's impartiality remained unanswered, and declared the arbitration of no legal effect because the lender could not prove that the borrowers had consented to its chosen tribunal. The Court directed money to be returned and appointed a new arbitrator.

High Courts, including Delhi, have in a number of cases refused to execute awards passed by unilaterally appointed arbitrators, holding that such an award is void and cannot be enforced even if the debtor did not file a Section 34 petition. The position depends on the facts, including when the appointment was made and what the borrower signed.

What to do if you discover a one-sided award

Time and typical cost range

Our fees are agreed in writing at the start and are not linked to the outcome.

Documents to collect

Which forum handles what

Proving that you never received notice

Courts do not simply accept a statement that "I never received anything". They look at the evidence on both sides. The lender or claimant will produce postal receipts, courier records or emails. Your task is to show why those do not prove proper notice.

Useful points include: the address used was one you had left, and you can show you informed the lender; the postal record shows "addressee left" or "refused" in circumstances you can explain; the courier tracking shows delivery to a different person or place; the emails went to an address not linked to you; the notices were sent so close to the hearing date that no reasonable person could have attended; or the arbitrator proceeded without checking whether notices had been served.

The arbitrator's own record is often revealing. If the minutes show that the arbitrator never asked for proof of service, or proceeded after a single notice, that supports your case. Under Section 25, an arbitrator can continue if a respondent fails to file a defence "without showing sufficient cause", but only after proper notice.

Should you settle instead?

Many people who discover a one-sided award do owe some money. The challenge is not about avoiding a genuine debt. It is about making sure the amount is right, that interest and penalties are lawful, and that you are not paying for a process you never had a chance to take part in.

A strong challenge often leads to a better settlement. Lenders facing the prospect of an award being declared void, and having to start again before a neutral arbitrator, frequently agree to a reduced amount or a payment plan. If you are considering settlement, keep your Section 34 deadline in view. File the challenge first, then negotiate; a settlement can be recorded and the petition withdrawn.

If you settle, get it in writing, with a clear statement that the award will not be enforced, that frozen accounts will be released, and that your credit record will be updated once payment is made.

If you are a guarantor or co-borrower

Guarantors are often named in loan arbitrations even though they signed a separate guarantee deed. If the guarantee does not contain an arbitration clause, or does not clearly incorporate the loan agreement's clause, the guarantor may not be bound to arbitrate at all, and an award against the guarantor may be challengeable on that ground alone. Co-borrowers who signed the main agreement are usually bound by its clause, but the notice and fairness points still apply to them individually. Each person named in the award should check their own documents and their own notices.

Laws that apply

How we work

We are a litigation and advisory practice led by Advocate BK Singh, with offices in Dwarka (New Delhi) and Vaishali (Ghaziabad). This is what you can expect:

• Fast first look: we can review an execution notice or freezing order the same day.
• Evidence of non-receipt built properly: address history, postal records and lender correspondence.
• Two-track approach: challenge in the seat court and objections in the execution court together.
• Settlement where sensible: we negotiate from a position of strength once the challenge is filed.
• Written fee terms: agreed stage by stage, never linked to the outcome.

Mistakes that make it harder

If you did take part, but the process was unfair

Not every one-sided award comes from a case you never knew about. Sometimes you attended a hearing or two, asked for time, and the arbitrator closed the proceedings without letting you file a defence or cross-examine the lender's witness. Sometimes the arbitrator accepted documents from the lender after the hearing, without giving you a copy. Sometimes the hearing was fixed at a place hundreds of kilometres away, with no option to join by video.

These situations can also fall within Section 34(2)(a)(iii), which covers a party who was "otherwise unable to present his case". The question for the court is whether you had a fair and real opportunity, not just a formal one. A refusal of one adjournment after many is not unfair. A refusal to let you file any defence at all, or reliance on evidence you never saw, may well be.

Keep whatever record you have: emails asking for time, the arbitrator's replies, hearing notices showing the venue, and any notes of what was said. If minutes of the proceedings were never shared with you, ask for them now in writing.

The deadline when you learned late

The three-month limit under Section 34(3) runs from "the date on which the party making that application had received the arbitral award". Courts have held that this means the party itself, and a signed copy, delivered in the way Section 31(5) requires. Receipt by a lawyer who was never authorised, or knowledge gained from a bank's freezing letter, does not necessarily start time.

That said, courts are wary of parties who say they never received the award but then sat on their hands after learning of it from other sources. Once you know an award exists, ask in writing for a signed copy from the arbitrator and the lender, keep proof of the request, and file promptly after you get it. If there is any doubt about the date, file as early as possible and explain the dates in your affidavit. A petition filed within three months of the earliest possible date avoids the argument altogether.

If the award came to you with an execution notice, note that date. If you can show the award was never served on you before, the execution notice may be the first proper receipt, but the safest course is to count from it and file within three months.

What happens after a successful challenge

If the court sets the award aside, the lender's claim does not vanish. The lender can start a fresh arbitration before a properly appointed, neutral arbitrator, or pursue other remedies such as a civil suit or, for secured loans above ₹20 lakh, proceedings under the SARFAESI Act. Section 43(4) of the Arbitration Act allows the period between the start of the first arbitration and the court's order to be excluded when counting limitation for a fresh claim, so the lender is usually not time-barred.

For borrowers, that fresh start is often the moment to settle. The lender now knows that penal charges and one-sided procedures will not hold, and a neutral arbitrator will examine its statement of account. Many fresh arbitrations never get past the first meeting because a settlement is agreed.