Delhi HC Appoints Justice Rajiv Shakdher as Arbitrator in Playboy Bar Dispute

Delhi High Court Appoints Justice Rajiv Shakdher as Arbitrator in Playboy Bar–Grand Hotel Dispute

Arbitration to resolve commercial conflict between luxury hotel and nightclub operator

Court stresses arbitration as preferred route for speedy settlement of business disputes

By Our Legal Reporter

New Delhi: October 10, 2025:

The Delhi High Court has appointed Justice Rajiv Shakdher (Retd.), former judge of the High Court, as the sole arbitrator in a high-profile dispute between Playboy Club/Bar and Grand Hotel, Vasant Kunj. The case involves disagreements over a commercial arrangement between the luxury hotel and the operators of the Playboy-branded nightclub.

The Court’s decision highlights the judiciary’s growing emphasis on arbitration as the primary mechanism for resolving commercial disputes in India, especially in the hospitality and entertainment sectors where contracts often involve large investments and brand licensing.

Background of the Dispute

The dispute arose out of a commercial agreement between the owners of Grand Hotel, Vasant Kunj and the operators of the Playboy Bar/Club.
The Playboy brand, known globally for its lifestyle and entertainment ventures, had entered India through licensing arrangements with local partners.
The Delhi outlet was one of the flagship Playboy-branded clubs in the country, located inside the Grand Hotel premises.
Differences reportedly emerged over financial terms, operational responsibilities, and alleged breaches of contract.

When negotiations failed, the matter reached the Delhi High Court, where both parties sought judicial intervention.

Court’s Observations

Justice Sanjeev Narula, while hearing the matter, noted that:

The agreement between the parties contained an arbitration clause, making arbitration the appropriate forum.
Courts should encourage parties to resolve commercial disputes through arbitration rather than prolonged litigation.
Given the complexity of the case and the need for neutrality, it was appropriate to appoint a retired senior judge as arbitrator.

Accordingly, the Court appointed Justice Rajiv Shakdher (Retd.) as the sole arbitrator to hear and decide the dispute.

Who is Justice Rajiv Shakdher?

Justice Shakdher is a respected former judge of the Delhi High Court.
Known for his expertise in commercial law, arbitration, and constitutional matters.
His appointment is expected to bring credibility, neutrality, and efficiency to the arbitration process.

Why Arbitration Matters in This Case

Arbitration is increasingly seen as the preferred method of dispute resolution in commercial contracts because:

It is faster than traditional court litigation.
Proceedings are confidential, which is important for high-profile brands like Playboy.
Parties can choose an expert arbitrator with relevant experience.
Awards are binding and enforceable under Indian law.

For the hospitality industry, where disputes often involve brand reputation, licensing fees, and operational control, arbitration provides a way to resolve conflicts without prolonged public battles.

The Playboy Brand in India

Playboy entered India through licensing deals in the mid-2010s.
The brand launched lounges, bars, and clubs in cities like Hyderabad, Pune, and Delhi.
The Delhi outlet at Grand Hotel was marketed as a luxury nightlife destination.
However, several Playboy ventures in India have faced legal, financial, and operational hurdles.

This dispute with Grand Hotel is one of the most prominent legal battles involving the brand in India.

Implications for the Hospitality Industry

The case is being closely watched by the hospitality and entertainment sectors because:

It underscores the importance of clear contracts in brand licensing and hotel partnerships.
It shows how arbitration clauses can save time and reduce uncertainty.
It highlights the risks global lifestyle brands face when entering the Indian market.

Industry experts say the outcome of this arbitration could influence how future hotel-nightclub partnerships are structured in India.

Next Steps in the Arbitration

Justice Rajiv Shakdher will now set up the arbitral tribunal and issue procedural directions.
Both parties will submit their claims, counter-claims, and evidence.
Hearings will be conducted privately, and the arbitrator will eventually issue a binding award.
Either party can challenge the award in court only on limited grounds under the Arbitration and Conciliation Act, 1996.

Broader Legal Context

The Delhi High Court’s decision aligns with India’s broader push to make the country an arbitration-friendly jurisdiction.

The Supreme Court and High Courts have repeatedly emphasized that commercial disputes should be referred to arbitration when contracts provide for it.
India has amended its arbitration laws in recent years to make the process faster and more reliable.
Appointing retired judges as arbitrators has become common practice to ensure neutrality and expertise.

Conclusion

The appointment of Justice Rajiv Shakdher as arbitrator in the Playboy Bar vs Grand Hotel dispute is a significant step toward resolving a high-profile commercial conflict in India’s hospitality sector.

For the parties involved, arbitration offers a chance to settle differences efficiently and confidentially. For the industry, the case serves as a reminder of the importance of robust contracts and dispute resolution mechanisms.

As arbitration proceedings begin, the outcome will not only decide the fate of the Playboy outlet at Grand Hotel but also set an example for how similar disputes in the hospitality and entertainment industries may be handled in the future.