The Delhi High Court has set aside an arbitral award favoring Zostel Hospitality in its dispute with travel-tech giant OYO. The court ruled that OYO did not breach its agreement during acquisition discussions with Zostel, which owns ZO Rooms, and dismissed Zostel’s execution petition.
The dispute dates back to 2015, when OYO and Zostel signed a non-binding term sheet for a potential acquisition. The deal collapsed due to failed due diligence and unresolved documentation. In 2018, Zostel initiated arbitration, leading to a 2021 arbitral award, which OYO challenged successfully.
The court affirmed OYO’s stance, noting no business transfer occurred and that a determinable contract cannot be specifically enforced, following Supreme Court precedents. This decision reaffirms that no binding agreement or consensus was reached on the transaction’s terms.
OYO expressed satisfaction with the ruling, emphasizing its dedication to providing quality, tech-driven accommodation solutions worldwide. The decision closes a contentious chapter, upholding OYO’s legal position while dismissing Zostel’s claims.
