Case Note & Summary
The appellant, M/s Equestrain Centre for Excellence, filed an application under Section 9 of the Arbitration and Conciliation Act, 1996, seeking an injunction restraining the respondent, M/s Chamundi Hotel Private Limited, from obstructing ingress and egress to the appellant's premises. The trial court dismissed the application. The appellant appealed under Section 37(1)(b) of the Act. The High Court held that the trial court erred in dismissing the application without considering the existence of an arbitration agreement and the prima facie case for interim relief. The court set aside the trial court's order and remanded the matter for fresh consideration.
Headnote
A) Arbitration Law - Interim Measures under Section 9 - Scope of Court's Power - Section 9 of the Arbitration and Conciliation Act, 1996 - The court has wide power to grant interim measures including injunction to protect the subject matter of the dispute. The court must consider the existence of an arbitration agreement and prima facie case. The trial court erred in dismissing the application without examining the arbitration agreement and merits. (Paras 2-10) B) Arbitration Law - Appeal under Section 37(1)(b) - Maintainability - Section 37(1)(b) of the Arbitration and Conciliation Act, 1996 - An appeal lies against an order refusing to grant an interim measure under Section 9. The High Court can set aside such order if the trial court failed to exercise jurisdiction properly. (Paras 1-2) C) Arbitration Law - Prima Facie Case for Injunction - Requirement - Section 9 of the Arbitration and Conciliation Act, 1996 - The applicant must show a prima facie case, balance of convenience, and irreparable injury. The trial court did not consider these aspects. (Paras 3-8)
Issue of Consideration
Whether the trial court was justified in dismissing the application under Section 9 of the Arbitration and Conciliation Act, 1996, without considering the existence of an arbitration agreement and the prima facie case for interim relief.
Final Decision
The High Court allowed the appeal, set aside the trial court's order dated 16.03.2017, and remanded the matter to the trial court for fresh consideration of the Section 9 application on merits.
Law Points
- Section 9 of the Arbitration and Conciliation Act
- 1996
- grants power to courts to pass interim orders before or during arbitral proceedings
- the court must consider the existence of an arbitration agreement and prima facie case
- the court cannot dismiss a Section 9 application solely on the ground that the dispute is not arbitrable without examining the agreement
- the scope of Section 9 is wide and includes injunctions to protect the subject matter of the dispute.
