Bombay HC Issues Show-Cause Notice To Shahs Over ₹700-Crore Decretal Amount

Mumbai: The Bombay High Court has issued show-cause notices to three developers asking why they should not be detained in civil prison for allegedly failing to pay a decretal amount arising from an arbitral award.

Justice Rajesh Patil, in an order pronounced on September 29, 2026, clarified that the order does not amount to their arrest or detention. The three — Kishor N. Shah, Vimal K. Shah and Nainesh K. Shah of Joyce Realtors Pvt Ltd. — have been given an opportunity to respond to the notices before any further action is considered.

Proceedings stem from arbitral award

The proceedings arose from an execution application filed by Urban Infrastructure Trustees Ltd and Urban Infrastructure Venture Capital Fund, following an arbitral award concerning an investment in Joyce Realtors Pvt Ltd. A three-member arbitral tribunal comprising retired Supreme Court judges had, in May 2019, directed the Shahs to pay Rs 106.61 crore with interest and Rs 16.56 crore towards compensation.

The decree holders told the court that the amount had since increased substantially and alleged that the judgment debtors had the means to pay but had failed to satisfy the award. They pointed to assets, ongoing real estate projects and loans advanced by the Shahs to group companies.

The Shahs, represented by senior counsel Aspi Chinoy, opposed the plea, arguing that mere non-payment was not enough to justify proceedings for arrest. They contended that the decree holder had to establish that they had the means to pay and had deliberately refused or neglected to do so.

Court examines detention provisions

The court examined Section 51 of the Code of Civil Procedure, which permits arrest and detention in execution proceedings only after prescribed conditions are satisfied. It noted that a judgment debtor must be given an opportunity to show cause before detention can be ordered.

Justice Patil also considered the financial disclosures of the Shahs. Their affidavits had disclosed assets of about Rs 130 crore. The court noted that they had also advanced loans to group companies after the arbitral award was passed.

The Shahs had argued that several of these amounts were loans to associate companies and were not readily realisable. They also maintained that payments towards education expenses, donations and other expenditures were made in the ordinary course and not to defeat the decree.

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Court finds case for notice

The court, however, held that the material on record made out a case for issuing a show-cause notice. It observed that the judgment debtors had “means to pay at least some substantial part of the award amount” but had not paid or deposited such amount.

“Today, I am not issuing a warrant of arrest or detaining the judgment debtors,” the judge clarified, adding that they would first be given an opportunity to respond to the notice.

The court accordingly directed issuance of show-cause notices.

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