Section 9 of the Arbitration and Conciliation Act, 1996 deals with interim reliefs in an arbitral proceeding. It entitles any party to obtain an interim relief at three stages –
- before the commencement of arbitration proceedings;
- during the course of the arbitration proceedings; and
- after the arbitral award is made but prior to its enforcement in accordance with sec. 36.
In order to grant relief under Sec. 9, the law still follows the course of the fundamental spirit of parameters of the interim relief measures given under the CPC, which are essential elements that are required to be fundamentally established before one is entitled to relief under section 9. These are:
- The existence of a prima facie case – The court must be satisfied that there is a bona fide dispute raised by the applicant, that there is a strong case for trial which needs investigation and a decision on merits and on the facts before the court there is a probability of the applicant being entitled to the relief claimed by him.
- The possibility of irreparable loss or prejudice, if the interim relief is not granted. – The existence of the prima facie case alone does not entitle the applicant to a temporary injunction. The applicant must further satisfy the court that he will suffer irreparable injury if the injunction as prayed is not granted, and that there is no other remedy open to him by which he can protect himself from the consequences of apprehended injury. In other words, the court must be satisfied that refusal to grant injunction would result in ‘irreparable injury’ to the party seeking relief and he needs to be protected from the consequences of the apprehended injury.
- Balance of convenience in favour of interim relief demanded – The court must be satisfied that the comparative mischief, hardship or inconvenience which is likely to be caused to the applicant by refusing the injunction will be greater than that which is likely to be caused to the opposite party by granting it.
- The concept of “just and convenient” – A party must necessarily showcase and establish the concept of “just and convenient” in addition to the three aforementioned grounds, in their favour. The words ‘just’ and ‘convenient’ mean that the Court is empowered to pass orders for interim protection of the rights of the parties pending adjudication of their rights in the arbitral proceedings. Grant of interim relief is a discretionary remedy. The discretion has to be exercised in the light of well-settled principles of law as to whether there is a prima facie case, balance of convenience and the probability of irreparable loss or injury. While seeking the discretionary relief, the petitioner is bound to approach the court with clean hands and not to conceal any facts.(S. Raminder Singh v. NCT of Delhi, 2002 SCC OnLine Del 1226, Para 10)
While it is true that the power under Section 9 of the Arbitration Act should not ordinarily be exercised ignoring the basic principles of procedural law as laid down in the CPC, the technicalities of CPC cannot prevent the Court from securing the ends of justice.(Essar House (P) Ltd. v. Arcellor Mittal Nippon Steel India Ltd., 2022 SCC OnLine SC 1219, Para 40)
More specifically, as far as the essentials of granting an injunction w.r.t.Section 9 is concerned, it is subject to fulfilment of the usual criteria, such as existence of genuine hardship, balance of convenience, existence of special equities between the parties, prevention of injustice, existence of a prima facie case and so on and so forth.(Mysore Manganese Co. (P) Ltd. v. Prakash Natural Resources Ltd., 2016 SCC OnLine Kar 385, Para 7)
The firm regularly advises on issues relating to Arbitration & Conciliation Act, 1996 and is handling important and complex cases before the Arbitral Tribunals, Commercial Courts (Jaipur & Jodhpur), the Rajasthan High Court at Jaipur and Jodhpur, Delhi High Court and the Supreme Court of India.