Case Note & Summary
The petitioner, Jatin Keshruwala, sole proprietor of Janvi Production, filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996, seeking interim reliefs including a garnishee order against respondent no. 2, Viacom 18 Media Pvt. Ltd., which was not a party to the arbitration agreement between the petitioner and respondent no. 1. The petitioner had a Co-Production Agreement dated 25 May 2017 with respondent no. 1 for a television show. The petitioner alleged that respondent no. 1 owed money and that respondent no. 2, as a broadcaster, was liable to pay amounts due to respondent no. 1. The court noted that the arbitration was yet to commence and that the petitioner had no privity of contract with respondent no. 2. The court held that at the interim stage, without a prima facie case that respondent no. 2 was liable to the petitioner, a garnishee order could not be granted. The petition was dismissed as premature, with liberty to the petitioner to seek appropriate relief after the arbitral tribunal is constituted.
Headnote
A) Arbitration - Interim Measures - Section 9 of the Arbitration and Conciliation Act, 1996 - Garnishee Order Against Third Party - The petitioner sought a garnishee order against respondent no. 2, a non-signatory to the arbitration agreement, to secure amounts allegedly payable by respondent no. 1. The court held that such relief cannot be granted at the interim stage without a prima facie case that the third party is liable to the petitioner. The petition was dismissed as premature. (Paras 2-5)
Issue of Consideration
Whether the petitioner is entitled to a garnishee order against respondent no. 2 (Viacom 18 Media Pvt. Ltd.) at the interim stage of arbitral proceedings under Section 9 of the Arbitration and Conciliation Act, 1996.
Final Decision
The petition is dismissed as premature. The petitioner is at liberty to seek appropriate relief before the arbitral tribunal after its constitution.
Law Points
- Section 9 of the Arbitration and Conciliation Act
- 1996
- interim measures
- garnishee order
- third party
- privity of contract
- prima facie case
Case Details
2019 LawText (BOM) (07) 96
Commercial Arbitration Petition (L) No. 659 of 2019
Mr. Gautam Ankhad a/w. Aditya Chopra, Ms. Kritika Seth, Ms. Sayali Phansikar, Ms. Dhwani Shah i/b. PSL for the petitioner. Dr. Birendra Saraf a/w. Aseem Naphde, Madhu Gadodia, Nitesh Agarwal, Rushabh Mehta i/b. Naik Naik & Co. for respondent no. 2.
Jatin Keshruwala (Sole Proprietor, Janvi Production)
M/s. DAG Creative Media Pvt. Ltd. and Viacom 18 Media Private Ltd.
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Nature of Litigation
Commercial arbitration petition under Section 9 of the Arbitration and Conciliation Act, 1996 seeking interim reliefs including a garnishee order against a third party.
Remedy Sought
Petitioner sought directions to respondents to deposit a sum of INR 3,41,41,356 with interest, deposit INR 18,000 per episode, and restrain respondent no. 1 from creating third party rights.
Filing Reason
Petitioner alleged that respondent no. 1 failed to pay amounts due under a Co-Production Agreement and sought to secure amounts from respondent no. 2, a broadcaster.
Issues
Whether a garnishee order can be granted against a third party (respondent no. 2) at the interim stage of arbitral proceedings under Section 9 of the Arbitration and Conciliation Act, 1996.
Submissions/Arguments
Petitioner argued that respondent no. 2 is liable to pay amounts due to respondent no. 1 and that interim relief is necessary to secure the petitioner's claim.
Respondent no. 2 opposed, contending that there is no privity of contract between the petitioner and respondent no. 2, and the petition is premature.
Ratio Decidendi
Under Section 9 of the Arbitration and Conciliation Act, 1996, interim relief against a third party who is not a signatory to the arbitration agreement cannot be granted at the interim stage without a prima facie case that the third party is liable to the petitioner. The court must exercise caution and not grant relief that effectively decides the dispute before the arbitral tribunal.
Judgment Excerpts
A short question which arises for consideration in this proceeding is as to whether the petitioner would be entitled to an order which is in the nature of garnishee order against respondent no. 2 Viacom 18 Media Pvt. Ltd., at the interim stage of the arbitral proceedings.
The petition is dismissed as premature. The petitioner is at liberty to seek appropriate relief before the arbitral tribunal after its constitution.
Procedural History
The petitioner filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996 on an unspecified date. The matter was heard on 16 July 2019, and the court dismissed the petition as premature.
Acts & Sections
- Arbitration and Conciliation Act, 1996: Section 9
