Case Note & Summary
The petitioner, Norvic Shipping Asia PTE Limited, filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996, seeking interim protection in support of arbitration proceedings pending before the London Maritime Arbitrators Association (LMAA). The dispute arose from a Repayment Schedule Agreement dated 9 January 2025, under which the respondent, Zigma International, admitted liability of USD 215,310.01 towards demurrage. The agreement provided for payment in installments, with a clause that failure to pay any installment would render the entire balance payable. The first installment fell due on 15 January 2025, but the respondent failed to make any payment despite reminders. The petitioner argued that the liability was admitted and sought an order directing the respondent to furnish security. The court noted that the respondent did not dispute the liability and had not paid any amount. The court held that the petitioner had made out a strong prima facie case and that the balance of convenience was in favor of granting interim relief. The court directed the respondent to furnish a bank guarantee for the full amount of USD 215,310.01 within four weeks, failing which the petitioner would be at liberty to apply for attachment of the respondent's assets. The petition was disposed of accordingly.
Headnote
A) Arbitration - Interim Measures - Section 9 of the Arbitration and Conciliation Act, 1996 - Admitted Liability - The court considered a petition under Section 9 seeking interim protection in support of LMAA arbitration in London. The dispute arose from a Repayment Schedule Agreement dated 9 January 2025, where the respondent admitted liability of USD 215,310.01 for demurrage. The court held that since liability was admitted and the respondent failed to pay installments, the petitioner was entitled to security. The court directed the respondent to furnish a bank guarantee of USD 215,310.01 within four weeks, failing which the petitioner could seek attachment. (Paras 1-6)
Issue of Consideration
Whether the petitioner is entitled to interim protection under Section 9 of the Arbitration and Conciliation Act, 1996, in support of foreign-seated arbitration proceedings, when the respondent has admitted liability under a repayment schedule agreement.
Final Decision
The court directed the respondent to furnish a bank guarantee for USD 215,310.01 within four weeks from the date of the order. If the respondent fails to furnish the bank guarantee, the petitioner is at liberty to apply for attachment of the respondent's assets. The petition is disposed of.
Law Points
- Section 9 of the Arbitration and Conciliation Act
- 1996
- interim measures
- admitted liability
- bank guarantee
- LMAA arbitration
