LEELA HOTELS LTD. vs HOUSING & URBAN DEV.CORP.LTD.

The Supreme Court upheld the decision of the Arbitrator in favor of Leela Hotels Ltd., affirming that HUDCO was liable to pay damages for the amounts paid as the first and second instalments, along with interest. The Court clarified that the terms of the sub-lease allowed for the forfeiture of 50% of the amount paid in case of default, but the Arbitrator's award was justified in allowing recovery of the remaining amounts. The Court emphasized the binding nature of the arbitration clause under the Arbitration and Conciliation Act, 1996, and dismissed HUDCO's appeal against the award.