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2012 DIGILAW 326 (HP)

Garg Gas Service v. Hindustan Petroleum Corporation Ltd.

2012-06-01

V.K.SHARMA

body2012
JUDGMENT : V.K. Sharma, J. The petitioners have moved the present petition u/s 9 of the Arbitration and Conciliation Act, 1996 (in short 'the Act') read with Order 39 Rules 1 & 2, read with Section 151 of the Code of Civil Procedure, 1908 (in short 'CPC') for grant of ad-interim relief, pending disposal of the arbitration proceedings, with the following prayer: It is, therefore, prayed that the application deserves to be allowed and pending the disposal of the appointment of arbitrator and the arbitration proceedings, this Hon'ble Court may be pleased to stay the operation of the order Annexure A-25 and the respondents be directed to continue the supplies and the dealership which has been suspended on such terms as this Hon'ble Court may deem fit and proper in the facts and circumstances of the case. Such other orders which this Hon'ble Court may deem fit and proper in the facts and circumstances of the case, may also be passed in favour of the applicant. The respondents are on caveat. 2. I have heard the learned Senior Counsel/counsel for the parties and gone through the record. 3. Admittedly, an application u/s 17 of the Act has already been filed by the petitioner before the Arbitrator for grant of interim measures. The application was filed as far back as 17.11.2011. However, for one reason or the other, no orders have admittedly been passed in the said application till date. 4. It is against the foregoing background that the petitioners have moved the present petition before this Court. At the very outset, an objection has been raised on behalf of the respondents that in view of pendency of application u/s 17 of the Act before the Arbitrator, the present petition u/s 9 of the Act is not maintainable. In this regard, reliance has been placed on an authoritative pronouncement of the Hon'ble Apex Court, reported as Firm Ashok Traders and Another v. Gurumukh Dass Saluja and Others, (2004) 3 Supreme Court Cases 155, wherein it has been held as under, vide Para 18 of the report: 18. Under the A & C Act 1996, unlike the predecessor Act of 1940, the arbitral tribunal is empowered by Section 17 of the Act to make orders amounting to interim measures. Under the A & C Act 1996, unlike the predecessor Act of 1940, the arbitral tribunal is empowered by Section 17 of the Act to make orders amounting to interim measures. The need for Section 9, in spite of Section 17 having been enacted, is that Section 17 would operate only during the existence of the arbitral tribunal and its being functional. During that period, the power conferred on the arbitral tribunal u/s 17 and the power conferred by the Court u/s 9 may overlap to some extent but so far as the period pre- and post - the arbitral proceedings is concerned the party requiring an interim measure of protection shall have to approach only the Court. The party having succeeded in securing an interim measure of protection before arbitral proceedings cannot afford to sit and sleep over the relief, conveniently forgetting the 'proximately contemplated' or 'manifestly intended' arbitral proceedings itself. If arbitral proceedings are not commenced within a reasonable time of an order u/s 9, the relationship between the order u/s 9 and the arbitral proceedings would stand snapped and the relief allowed to the party shall cease to be an order made 'before' i.e. in contemplation of arbitral proceedings. The Court approached by a party with an application u/s 9, is justified in asking the party and being told how and when the party approaching the Court proposes to commence the arbitral proceedings. Rather, the scheme in which Section 9 is placed obligates the Court to do so. The Court may also while passing an order u/s 9 put the party on terms and may recall the order if the party commits breach of the terms. 5. A perusal of the dictum of law, enunciated by the Hon'ble Supreme Court in the case of Firm Ashok Traders and Another, supra would go to show that the Hon'ble Court has held that "the power conferred on the Arbitral Tribunal u/s 17 and the power conferred on the Court u/s 9 may overlap to some extent". 6. 5. A perusal of the dictum of law, enunciated by the Hon'ble Supreme Court in the case of Firm Ashok Traders and Another, supra would go to show that the Hon'ble Court has held that "the power conferred on the Arbitral Tribunal u/s 17 and the power conferred on the Court u/s 9 may overlap to some extent". 6. In the present case, when application u/s 17 could not be taken up by the Arbitrator for consideration and orders, for a period of over five months, I am satisfied that the prayer of the petitioner for grant of interim measures u/s 9 of the Act is squarely covered under the dictum of law laid down by the Hon'ble Supreme Court in the aforesaid judgment. 7. In view of the above, the petition is disposed of with a direction to the Arbitrator to take up the aforesaid application u/s 17 of the Act, moved by the petitioner before him, for consideration and take a final decision thereon within one month thereafter, that is, on or before 15.7.2012 and in the meantime, operation of the impugned order dated 12.5.2012, Annexure A-25, shall stand stayed, till final disposal of the application. The petition, as also the pending OMPs No. 169 and 170 of 2012 shall stand disposed of.