Arbitration Law

Velugubanti Hari Babu vs. Parvathini Narasimha Rao and Ors. [2018 (3) ALD 456]: Telangana & Andhra Pradesh High Court

An interim order under section 9 of the Arbitration Act continues till conclusion of the arbitral proceedings and does not stop to operate with constitution of arbitral tribunal

29. As regards the submission that the interim order granted by the Civil Court would automatically come to an end once an arbitrator is appointed and thereafter the party has to seek interim relief before the arbitrator, we find the same without any merit. In M/s. Sundaram Finance Ltd. MANU/SC/0012/1999 : (1999) 2 SCC 479 (supra), the Supreme Court held at para-13 as under :

“Under the 1996 Act the Court can pass interim orders under Section 9. Arbitral proceedings, as we have seen, commence only when the request to refer the dispute is received by the respondent as per Section 21 of the Act. The material words occurring in Section 9 are “before or during the arbitral proceedings”. This clearly contemplates two stages when the Court can pass interim orders, i.e., during the arbitral proceedings or before the arbitral proceedings…..”.

The language of Section 9(2) of the Act does not limit the operation of interim measure till appointment of arbitrator only. On the contrary, a party can seek interim measure at three stages, viz., before, during the pendency of arbitral proceedings and after passing of the award, but before it is enforced under Section 36 of the Act. The fact that a party can approach the Court even during the pendency of the arbitral proceedings and seek interim measure, clearly shows that the legislature clearly intended to empower the court to grant interim measure to last till the arbitral proceedings conclude and an award is passed. As noted above, the Court is empowered to grant such measures even after an award is passed, but before it is enforced.

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