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2009 DIGILAW 523 (BOM)

TATA CAPITAL LTD. v. A. R. INDUSTRIES PVT. LTD.

2009-04-17

ANOOP V.MOHTA

body2009
JUDGMENT Anoop V. Mohta, J. By consent, heard finally, Admittedly, the petition under Section 9 of the Arbitration and Conciliation Act, 1996 (for short 'the Arbitration Act') is pending since 13th January, 2009. This court at the prima facie stage, refused to grant ad interim relief in terms of Prayer Clause (c). The arbitral tribunal was constituted thereafter. It is reported that the arbitral tribunal has already heard the parties and the matter is closed for final award. Admittedly, no application under Section 17 of the Arbitration Act, was filed before the tribunal in view of the pendency of the Section 9 petition in the High Court. Now, the matter is today for final disposal. Considering the whole averments as made and as the learned counsel appearing for the petitioner submits that there is no serious dispute about the claim as raised by the petitioner and there is no order to secure the amount involved in the dispute. The learned counsel appearing for the respondent submits that as the matter is already heard, the petitioner can get the award executed, if it is in his favour, therefore, there is no question of passing any order under Section 9 of the Arbitration Act. Section 9 contemplates a situation where even before the constitution of tribunal or initiation of the award or even in a situation where the tribunal has closed the matter for award, but not passed any order for securing the amount involved in the claim, if a case is made the court may pass appropriate order/injunction to secure the amount involved. The apprehension so referred and the averments which are made in petition, even at this stage, just cannot be overlooked only on the ground that the arbitral tribunal has heard the matter and it is closed for order. The situation where neither the tribunal has passed any order nor in Section 9 application court has granted ad interim relief before constitution of the tribunal, just cannot be the reason to disallow the claim of protection as prayed by the petitioner which is available under Section 9 of the Arbitration Act. An interim protection as contemplated under the Arbitration Act when can be granted is elaborated recently by the Supreme Court in Arvind Construction Co. (P.) Ltd. v. Kalinga Mining Corporation and others, (2007) 6 SCC 798 = 2007 SCACTC 321 (SC) = 2007 (2) Arb. An interim protection as contemplated under the Arbitration Act when can be granted is elaborated recently by the Supreme Court in Arvind Construction Co. (P.) Ltd. v. Kalinga Mining Corporation and others, (2007) 6 SCC 798 = 2007 SCACTC 321 (SC) = 2007 (2) Arb. LR 279 (SC), the relevant portion of which is as under: "15. The argument that the power under Section 9 of the Act is independent of the Specific Relief Act or that the restrictions placed by the Specific Relief Act cannot control the exercise of power under Section 9 of the Act cannot prima facie be accepted. ..... No doubt, a view that exercise of power under Section 9 of the Act is not controlled by the Specific Relief Act has been taken by the Madhya Pradesh High Court, the power under Section 9 of the Act is not controlled by Order 38 Rule 5 of the Code of Civil Procedure is a view taken by the High Court of Bombay. But, how far these decisions are correct, requires to be considered in an appropriate case. Suffice it to say that on the basis of the submissions made in this case, we are not inclined to answer that question finally. But, we may indicate that we are prima facie inclined to the view that exercise of power under Section 9 of the Act must be based on well recognised principles governing the grant of interim injunctions and other orders of interim protection or the appointment of a receiver." In the present case, in my view, those ingredients are available to grant the protection to secure the amount as prayed, i.e. Rs. 18 lakhs and odd. The prayer is made to secure and to pass appropriate order with regard to the property mentioned in Exhibit "G". Considering the involvement of the amount, in my view, pending the passing of the arbitral award, so far as the Item I of the Schedule of the Properties at Exhibit "G", the respondents shall not create third party right or interest or deal with or dispose off the said property. In the alternative, the respondents are at liberty to furnish the bank guarantee within two weeks to secure the amount. This protection is only up to the date of the award. In view of this, the petition is allowed to that extent. No costs.