Section 9 of The Arbitration and Conciliation Act should be repealed or

replaced.

GENERAL CONCEPT –

Section 9 of the Arbitration Act confers a wide power on the court to pass orders securing the
amount in dispute in arbitration, whether before the commencement of the arbitral proceedings,
during the arbitral proceedings or at any time after making the arbitral award, but before its
enforcement in accordance with Section 36 of the Arbitration Act. All that the court is required
to see is, whether the applicant for the interim measure has a good prima facie case, whether
the balance of convenience is in favour of interim relief as prayed for being granted and whether
the applicant has approached the court with reasonable expedition.

If a strong prima facie case is made out and the balance of convenience is in favour of interim
relief is granted, the court exercising power under Section 9 of the Arbitration Act should not
withhold relief on the mere technicality of the absence of averments, incorporating the grounds
for attachment before judgment under Order 38 Rule 5 CPC.

The Act has not specified any specific procedure to conduct the proceedings under section 9 of
the Act. Therefore, there always has been skepticism regarding the precise procedure to be
followed. There is a lot of ambiguity concerning this point as many high courts have given
contradicting judgments. Despite this the Amendment Act has not made it clear.

The basic idea of section 9 of the arbitration and conciliation act is that interim relief is an
arbitration proceeding It entitles any party to obtain interim relief at three stages –

I. Before the commencement of the arbitration proceedings

II. During arbitration proceedings
III. After when the arbitral award is given but before its enforcement
A considerable time may elapse between the time of invoking the arbitration and the
appointment of an arbitral tribunal by the Court. During the time in between, if an
urgent relief is sought and there is hardly any time to wait, Section 9 specifically
provides before that “arbitral proceedings”, an individual is also entitled to move the
Court if he/she feels the urgency. Therefore, the entire purpose of Section 9 is to
provide relief to the parties when the arbitral tribunal is not even in existence.

Though arbitration is supposed to be undertaken by the arbitral tribunal alone, the Act
recognizes the fact that the rights of the parties should not be frustrated. Hence, in a period
when the tribunal may not be in existence, the parties may approach the Court for relief.
THE GENERAL PROVISIONS WITH CASE LAWS.

The sole purpose of an application under Section 9 is to grant interim relief and to protect the
rights. The application does not affect the proceedings of the arbitration.
In the landmark case of Vidya Drolia and Others v. Durga, Trading Corporation 1held that
the purpose of Section 9 of the Arbitration and Conciliation Act, 1996 is solely for providing
interim relief and even though the Section has the protection to affect the rights of the parties,
it does not affect the conduct of the arbitration.
In 2021, the Supreme Court in the order of Pravin Electricals (P) Ltd. v. Galaxy Infra and
Engg. (P) Ltd. confirmed this in relation to Section 9.

The Vidya Droila judgement has become a landmark judgement in determining the scope of
Section 9 of the Act. Similarly, in the case of Leighton India Contractors Private Ltd. vs.
DLF Ltd. (2020), the Delhi High Court has held that the scope of Section 9 of the Act is very
broad and does not curtail the powers of the court.

ENSUING PROBLEMS: WHEN SILENCE IS NOT GOLDEN

The foregoing section of this article makes it amply clear that Section 9(2) leaves many
questions unanswered, leading to certain unwanted consequences, including but not limited to
(i) increased scope for judicial intervention and interference;

(ii) major inconvenience to the party against which the interim order has been granted (more
so when it is ex-parte interim order);

(iii) interim orders gaining the status of de facto permanency;

(iv) delay and derailment of arbitration proceedings;

(v) greater consequences of an ill-obtained injunction order;

(vi) wide discretion to courts leading to contradictory orders, thereby hindering the process of
unification of laws in India. Given the objectives of the arbitration process, there is a dire need
to suggest certain measures to disturb this silence of the legislation.

1
2019 SCC OnLine SC 358
ANALYSIS

The said section 9 of the arbitration and conciliation can be repeal on the ground that the
provision is based on the judicial level is still not in the arbitration panel and hence with the
support of the above provisions case laws support that might be justified in the ground that
the said section 9 can be repealed on the ground that the intervention of the same the
violation the faster justice system. Section 9 of the Act confers wide powers on the court to
pass orders securing the subject matter of the arbitration agreement, the amount in dispute in
arbitration, etc, whether before the commencement of the arbitral proceedings, during the
arbitral proceedings or at any time after making of the arbitral award, but before its
enforcement in accordance with Section 36 of the Act. All that the court is required to see and
satisfy itself with are the settled principles while granting such equitable remedy: whether the
applicant for the interim measure has a good prima facie case; whether the balance of
convenience is in favour of interim relief as prayed for being granted; and whether the
applicant has approached the court with reasonable expedition (SREI Infrastructure Finance
Limited v. M/s Ravi Udyog Pvt Ltd & Anr).

It is also important to note that an application under Section 9 of the Act for grant of interim
relief is not to be judged as per the standards of a plaint in a suit. Mere procedural
technicalities cannot come in the way of granting such relief, when the applicant has satisfied
the court with relevant facts pleaded (read with the documents in support of the petition), that
the application warrants the grant of interim relief. In such cases, interim relief ought not to
be refused.