However, where the mandate of the learned arbitrator has terminated with
pronoucement of the final award and there is no application under Section 33 and no order
of court under Section 34(4,) there can be no question of making application for interim
relief before the arbitral tribunal, the reason being that the arbitral tribunal has ceased to
function since its mandate has terminated.
Even otherwise the learned court might entertain an application for interim relief
after the constitution of a tribunal if the court finds that circumstances exist which might not
render the remedy provided under Section 17 efficacious.
In view of the uncertainty as to whether the arbitral tribunal can at all be said to be
functional and/or whether the mandate of the arbitral tribunal stands terminated, the learned
court was justified in entertaining the application under Section 9. May be reasons should
have been given by the learned Court below. However, a party obtaining an order in its
favour is not to suffer only by reason of the failure of the Court to give reasons if the order is
otherwise sustainable in law. We find no infirmity with the decision to grant interim relief.
CALCUTA HIGH COURT
DATED;12.5.2016 F.M.A.T. 215 of 2016
(1) with
C.A.N. 2529 of 2016
Mr. Bishnu Kumar Yadav
V
M/s.M. L. Soni & Sons & Anr.
Citation:AIR 2016 Cal 347
This appeal is against an Order passed by the learned Judge, VIIIth Bench, City
Civil Court at Calcutta in an application for interim relief filed by the respondent financier
under Section 9 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as
“1996 Act”).
By the order impugned, the learned Court has appointed a Receiver for the purpose
of taking over possession of a vehicle bearing Registration No. WB 23B 6532 with Engine
No. 80K62716108 and Chassis No. 426031KRZ223212 observing that a huge amount of
money was payable by the appellant to the respondent financier.
The vehicle in question was financed by the respondent financier and remained
hypothecated and/or charged with the respondent financier. Mr. Pradeep Kumar, learned
Counsel appearing on behalf of the appellant challenged the impugned order on the ground
that the application under Section 9 of the 1996 Act ought not to have been entertained in
view of the amendments to Sections 9 and 17 of the 1996 Act, by the Arbitration and
Conciliation (Amendment) Act, 2015.
The provisions of Sections 9 and 17 of the 1996 Act as amended by the Arbitration
and Conciliation (Amendment) Act, 2015 with effect from 23rd October, 2015 are set out
herein below for convenience :“ 9. Interim measures etc. by Court. – (1) A party may, before, or during
arbitral proceeding or at any time after the making of the arbitral award but before it
is enforced in accordance with section 36, apply to a Court –
(i) for the appointment of a guardian for a minor or person of unsound mind for the
purposes of arbitral proceedings; or
(ii) for an interim measure of protection in respect of any of the following
matters, namely :-
(a) the preservation, interim custody or sale of any goods which are
the subject-matter of the arbitration agreement;
(b) securing the amount in dispute in the arbitration;
(c) the detention, preservation or inspection of any property or thing
which is the subject-matter of the dispute in arbitration, or as to which
any question may arise therein and authorising for any of the aforesaid
purposes any person to enter upon any land or building in the
possession of any party, or authorising any samples to be taken or any
observation to be made, or experiment to be tried, which may be necessary or
expedient for the purpose of obtaining full information or evidence;
(d) interim injunction or the
appointment of a receiver;
(e) such other interim measure of protection as may appear to the Court
to be just and convenient,
and the Court shall have the same power for making orders as it has for the purpose
of, and in relation to, any proceedings before it.
(2) Where, before the commencement of the arbitral proceedings, a Court passes an
order for any interim measure of protection under sub-section (1), the arbitral
proceedings shall be commenced within a period of ninety days from the date of such
order or within such further time as the Court may determine.(3) Once the arbitral tribunal has been constituted, the Court shall not entertain an
application under sub-section (1), unless the Court finds that circumstances exist
which may not render the remedy provided under section 17 efficacious.”
“17. Interim measures ordered by arbitral tribunal.- (1) A party may, during the
arbitral proceedings or at any time after the making of the arbitral award but before it
is enforced in accordance with section 36 apply to the arbitral tribunal-
(i) for the appointment of a guardian for a minor or person of unsound mind for the
purposes of arbitral proceedings; or
(ii) for an interim measure of protection in respect of any of the following matters,
namely :-
(a) the preservation, interim custody or sale of any goods which are the subject-matter of
the arbitration agreement;
(b) securing the amount in dispute in the arbitration;
(c) the detention, preservation or inspection of any property or thing which is the
subject-matter of the dispute in arbitration, or as to which any question may arise
therein and authorising for any of the aforesaid purposes any person to enter upon
any land or building in the possession of any party, or authorising any samples to be
taken, or any observation to be made, or experiment to be tried, which may be
necessary or expedient for the purpose of obtaining full information or evidence;
(d) interim injunction or the appointment of a receiver;
(e) such other interim measure of protection as may appear to the arbitral tribunal to be
just and convenient,
and the arbitral tribunal shall have the same power for making orders, as the court
has for the purpose of, and in relation to, any proceedings before it.
(2) Subject to any orders passed in an appeal under section 37, any order issued by the
arbitral tribunal under this section shall be deemed to be an order of the Court for all
purposes and shall be enforceable under the Code of Civil Procedure, 1908 (5 of
1908), in the same manner as if it were an order of the Court.”As rightly argued by Mr. Pradeep Kumar the
learned Arbitral Tribunal has by the Amendment Act,
2015 been conferred with identical powers as the Court
under Section 9 to grant interim relief. Mr. Pradeep
Kumar argued that in view of sub-section (3) of Section 9
of the 1996 Act as amended the Court ought not to have
entertained the application under Section 9. Sub-section
3 of Section 9 quoted above provides that once an arbitral
tribunal has been constituted, the Court shall not
entertain an application under sub-section (1) of Section 9
unless the Court finds that circumstances exist which
may not render the remedy provided under Section 17
efficacious.
The jurisdiction of Court to grant interim relief does not automatically get barred
once the arbitral tribunal is constituted. However, the Court would not ordinarily entertain
an application. The Court might however entertain an application if circumstances exist
which may not render the remedy provided under Section 17 efficacious.
Mr. Pradeep Kumar also emphasized on the opening words of Section 17 which
reads “A party may, during the arbitral proceedings or at any time after the making of the
arbitral award but before it is enforced in accordance with section 36, apply to the arbitral
tribunal” for interim relief.
In the application being C.A.N. 2529 of 2016 for stay of the order under appeal, it
is pleaded that in course of hearing of the aforesaid application, the appellant came to know
for the first time, that the learned Arbitrator appointed at the instance of the respondent, hadmade and published an award dated 23rd July, 2015. However, no copy of the award had
been served upon the petitioner.
An application for setting aside of the said purported award dated 23rd July, 2015
under Section 34 of the Arbitration and Conciliation Act, 1996 has been filed by the
petitioner and the same is pending for disposal. A copy of the said application filed under
Section 34 of the Arbitration and Conciliation Act, 1996 is annexed to the stay application.
Section 32 of the 1996 Act provides that the arbitral proceedings shall be
terminated by the final arbitral award or by an order of the arbitral tribunal under sub-section
(2). Sub-section (2) of Section 32 provides for issuance of an order for the termination of the
arbitral proceedings, where the claimant withdraws his claim, unless the respondent objects
to the order and the arbitral tribunal recognises a legitimate interest on his part in obtaining a
final settlement of the dispute or where the parties agree on the termination of the
proceedings, or where the arbitral tribunal finds tht the continuation of the proceedings has
for any other reason become unnecessary or impossible. Sub-section (3) provides that
subject to section 33 and sub-section (4) of section 34, the mandate of the arbitral tribunal
shall terminate with the termination of the arbitral proceedings.
In this context, reference may be made to Section 33 of the 1996 Act which is set
out herein below for convenience :
“33. Correction and interpretation of award; additional award.- (1) Within thirty
days from the receipt of the arbitral award, unless another period of time has been agreed
upon by the parties-
(a) a party, with notice to the other party, may request the arbitral tribunal to correct any
computation errors, any clerical or typographical errors or any other errors of a similar
nature occurring in the award;
(b) if so agreed by the parties, a party, with notice to the other party, may request the arbitral
tribunal to give an interpretation of a specific point or part of the award.(2) If the arbitral tribunal considers the request made under sub-section (1) to be justified, it
shall make the correction or give the interpretation within thirty days from the receipt of the
request and the interpretation shall form part of the arbitral award.
(3) The arbitral tribunal may correct any error of the type referred to in clause (a) or sub-section
(1), on its own initiative, within thirty days from the date of the arbitral award.
(4) Unless otherwise agreed by the parties, a party with notice to the other party, may request,
within thirty days from the receipt of the arbitral award, the arbitral tribunal to make an
additional arbitral award as to claims presented in the arbitral proceedings but omitted from
the arbitral award.
(5) If the arbitral tribunal considers the request made under sub-section (4) to be justified, it
shall make the additional arbitral award within sixty days from the receipt of such request.
(6) The arbitral tribunal may extend, if necessary, the period of time within which it shall make
a correction, give an interpretation or make an additional arbitral award under sub-section
(2) or sub-section (5).
(7) Section 31 shall apply to a correction or interpretation of the arbitral award or to an
additional arbitral award made under this section.
Reference may also be made to sub-section (4) of Section
34 of the 1996 Act which provides that on receipt of an
application under sub-section (1), the Court might, where it is
appropriate and it is so requested by a party, adjourn the
proceedings for a period of time determined by it in order, to
give the arbitral tribunal an opportunity to resume the arbitral
proceedings or to take such other action, as in the opinion of
arbitral tribunal, will eliminate the grounds for setting aside
the arbitral award.From the aforesaid provisions it is patently clear that once a final award is
pronounced the mandate of the arbitrator terminates unless the circumstances specified in
Section 33 or Section 34(4) exist.
An arbitral award has been defined in Section 2 sub-section (c) of the 1996 Act to
include an interim award. After an interim award, which is also an award within the meaning
of Section 2(c), is made an application for interim relief would necessarily have to be made
before the learned tribunal under the amended provision of Section 17. Similarly, if after the
pronouncement of the final award there was an application to the arbitrator under Section 33
or an order of court in terms of Section 34 sub-section (4) an application for interim relief
would have to be made before the learned arbitrator.
However, where the mandate of the learned arbitrator has terminated with
pronoucement of the final award and there is no application under Section 33 and no order
of court under Section 34(4,) there can be no question of making application for interim
relief before the arbitral tribunal, the reason being that the arbitral tribunal has ceased to
function since its mandate has terminated.
Even otherwise the learned court might entertain an application for interim relief
after the constitution of a tribunal if the court finds that circumstances exist which might not
render the remedy provided under Section 17 efficacious.
In view of the uncertainty as to whether the arbitral tribunal can at all be said to be
functional and/or whether the mandate of the arbitral tribunal stands terminated, the learned
court was justified in entertaining the application under Section 9. May be reasons should
have been given by the learned Court below. However, a party obtaining an order in its
favour is not to suffer only by reason of the failure of the Court to give reasons if the order is
otherwise sustainable in law. We find no infirmity with the decision to grant interim relief.
For the reasons discussed above, the appeal along with the connected application is
dismissed. All other questions are kept open.Urgent certified photostat copy of this order, if applied for, be supplied to the
learned Advocates appearing for the parties, subject to compliance with all requisite
formalities.
( Indira Banerjee, J. )
( Sahidullah Munshi, J. )
Print Page
pronoucement of the final award and there is no application under Section 33 and no order
of court under Section 34(4,) there can be no question of making application for interim
relief before the arbitral tribunal, the reason being that the arbitral tribunal has ceased to
function since its mandate has terminated.
Even otherwise the learned court might entertain an application for interim relief
after the constitution of a tribunal if the court finds that circumstances exist which might not
render the remedy provided under Section 17 efficacious.
In view of the uncertainty as to whether the arbitral tribunal can at all be said to be
functional and/or whether the mandate of the arbitral tribunal stands terminated, the learned
court was justified in entertaining the application under Section 9. May be reasons should
have been given by the learned Court below. However, a party obtaining an order in its
favour is not to suffer only by reason of the failure of the Court to give reasons if the order is
otherwise sustainable in law. We find no infirmity with the decision to grant interim relief.
CALCUTA HIGH COURT
DATED;12.5.2016 F.M.A.T. 215 of 2016
(1) with
C.A.N. 2529 of 2016
Mr. Bishnu Kumar Yadav
V
M/s.M. L. Soni & Sons & Anr.
Citation:AIR 2016 Cal 347
This appeal is against an Order passed by the learned Judge, VIIIth Bench, City
Civil Court at Calcutta in an application for interim relief filed by the respondent financier
under Section 9 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as
“1996 Act”).
By the order impugned, the learned Court has appointed a Receiver for the purpose
of taking over possession of a vehicle bearing Registration No. WB 23B 6532 with Engine
No. 80K62716108 and Chassis No. 426031KRZ223212 observing that a huge amount of
money was payable by the appellant to the respondent financier.
The vehicle in question was financed by the respondent financier and remained
hypothecated and/or charged with the respondent financier. Mr. Pradeep Kumar, learned
Counsel appearing on behalf of the appellant challenged the impugned order on the ground
that the application under Section 9 of the 1996 Act ought not to have been entertained in
view of the amendments to Sections 9 and 17 of the 1996 Act, by the Arbitration and
Conciliation (Amendment) Act, 2015.
The provisions of Sections 9 and 17 of the 1996 Act as amended by the Arbitration
and Conciliation (Amendment) Act, 2015 with effect from 23rd October, 2015 are set out
herein below for convenience :“ 9. Interim measures etc. by Court. – (1) A party may, before, or during
arbitral proceeding or at any time after the making of the arbitral award but before it
is enforced in accordance with section 36, apply to a Court –
(i) for the appointment of a guardian for a minor or person of unsound mind for the
purposes of arbitral proceedings; or
(ii) for an interim measure of protection in respect of any of the following
matters, namely :-
(a) the preservation, interim custody or sale of any goods which are
the subject-matter of the arbitration agreement;
(b) securing the amount in dispute in the arbitration;
(c) the detention, preservation or inspection of any property or thing
which is the subject-matter of the dispute in arbitration, or as to which
any question may arise therein and authorising for any of the aforesaid
purposes any person to enter upon any land or building in the
possession of any party, or authorising any samples to be taken or any
observation to be made, or experiment to be tried, which may be necessary or
expedient for the purpose of obtaining full information or evidence;
(d) interim injunction or the
appointment of a receiver;
(e) such other interim measure of protection as may appear to the Court
to be just and convenient,
and the Court shall have the same power for making orders as it has for the purpose
of, and in relation to, any proceedings before it.
(2) Where, before the commencement of the arbitral proceedings, a Court passes an
order for any interim measure of protection under sub-section (1), the arbitral
proceedings shall be commenced within a period of ninety days from the date of such
order or within such further time as the Court may determine.(3) Once the arbitral tribunal has been constituted, the Court shall not entertain an
application under sub-section (1), unless the Court finds that circumstances exist
which may not render the remedy provided under section 17 efficacious.”
“17. Interim measures ordered by arbitral tribunal.- (1) A party may, during the
arbitral proceedings or at any time after the making of the arbitral award but before it
is enforced in accordance with section 36 apply to the arbitral tribunal-
(i) for the appointment of a guardian for a minor or person of unsound mind for the
purposes of arbitral proceedings; or
(ii) for an interim measure of protection in respect of any of the following matters,
namely :-
(a) the preservation, interim custody or sale of any goods which are the subject-matter of
the arbitration agreement;
(b) securing the amount in dispute in the arbitration;
(c) the detention, preservation or inspection of any property or thing which is the
subject-matter of the dispute in arbitration, or as to which any question may arise
therein and authorising for any of the aforesaid purposes any person to enter upon
any land or building in the possession of any party, or authorising any samples to be
taken, or any observation to be made, or experiment to be tried, which may be
necessary or expedient for the purpose of obtaining full information or evidence;
(d) interim injunction or the appointment of a receiver;
(e) such other interim measure of protection as may appear to the arbitral tribunal to be
just and convenient,
and the arbitral tribunal shall have the same power for making orders, as the court
has for the purpose of, and in relation to, any proceedings before it.
(2) Subject to any orders passed in an appeal under section 37, any order issued by the
arbitral tribunal under this section shall be deemed to be an order of the Court for all
purposes and shall be enforceable under the Code of Civil Procedure, 1908 (5 of
1908), in the same manner as if it were an order of the Court.”As rightly argued by Mr. Pradeep Kumar the
learned Arbitral Tribunal has by the Amendment Act,
2015 been conferred with identical powers as the Court
under Section 9 to grant interim relief. Mr. Pradeep
Kumar argued that in view of sub-section (3) of Section 9
of the 1996 Act as amended the Court ought not to have
entertained the application under Section 9. Sub-section
3 of Section 9 quoted above provides that once an arbitral
tribunal has been constituted, the Court shall not
entertain an application under sub-section (1) of Section 9
unless the Court finds that circumstances exist which
may not render the remedy provided under Section 17
efficacious.
The jurisdiction of Court to grant interim relief does not automatically get barred
once the arbitral tribunal is constituted. However, the Court would not ordinarily entertain
an application. The Court might however entertain an application if circumstances exist
which may not render the remedy provided under Section 17 efficacious.
Mr. Pradeep Kumar also emphasized on the opening words of Section 17 which
reads “A party may, during the arbitral proceedings or at any time after the making of the
arbitral award but before it is enforced in accordance with section 36, apply to the arbitral
tribunal” for interim relief.
In the application being C.A.N. 2529 of 2016 for stay of the order under appeal, it
is pleaded that in course of hearing of the aforesaid application, the appellant came to know
for the first time, that the learned Arbitrator appointed at the instance of the respondent, hadmade and published an award dated 23rd July, 2015. However, no copy of the award had
been served upon the petitioner.
An application for setting aside of the said purported award dated 23rd July, 2015
under Section 34 of the Arbitration and Conciliation Act, 1996 has been filed by the
petitioner and the same is pending for disposal. A copy of the said application filed under
Section 34 of the Arbitration and Conciliation Act, 1996 is annexed to the stay application.
Section 32 of the 1996 Act provides that the arbitral proceedings shall be
terminated by the final arbitral award or by an order of the arbitral tribunal under sub-section
(2). Sub-section (2) of Section 32 provides for issuance of an order for the termination of the
arbitral proceedings, where the claimant withdraws his claim, unless the respondent objects
to the order and the arbitral tribunal recognises a legitimate interest on his part in obtaining a
final settlement of the dispute or where the parties agree on the termination of the
proceedings, or where the arbitral tribunal finds tht the continuation of the proceedings has
for any other reason become unnecessary or impossible. Sub-section (3) provides that
subject to section 33 and sub-section (4) of section 34, the mandate of the arbitral tribunal
shall terminate with the termination of the arbitral proceedings.
In this context, reference may be made to Section 33 of the 1996 Act which is set
out herein below for convenience :
“33. Correction and interpretation of award; additional award.- (1) Within thirty
days from the receipt of the arbitral award, unless another period of time has been agreed
upon by the parties-
(a) a party, with notice to the other party, may request the arbitral tribunal to correct any
computation errors, any clerical or typographical errors or any other errors of a similar
nature occurring in the award;
(b) if so agreed by the parties, a party, with notice to the other party, may request the arbitral
tribunal to give an interpretation of a specific point or part of the award.(2) If the arbitral tribunal considers the request made under sub-section (1) to be justified, it
shall make the correction or give the interpretation within thirty days from the receipt of the
request and the interpretation shall form part of the arbitral award.
(3) The arbitral tribunal may correct any error of the type referred to in clause (a) or sub-section
(1), on its own initiative, within thirty days from the date of the arbitral award.
(4) Unless otherwise agreed by the parties, a party with notice to the other party, may request,
within thirty days from the receipt of the arbitral award, the arbitral tribunal to make an
additional arbitral award as to claims presented in the arbitral proceedings but omitted from
the arbitral award.
(5) If the arbitral tribunal considers the request made under sub-section (4) to be justified, it
shall make the additional arbitral award within sixty days from the receipt of such request.
(6) The arbitral tribunal may extend, if necessary, the period of time within which it shall make
a correction, give an interpretation or make an additional arbitral award under sub-section
(2) or sub-section (5).
(7) Section 31 shall apply to a correction or interpretation of the arbitral award or to an
additional arbitral award made under this section.
Reference may also be made to sub-section (4) of Section
34 of the 1996 Act which provides that on receipt of an
application under sub-section (1), the Court might, where it is
appropriate and it is so requested by a party, adjourn the
proceedings for a period of time determined by it in order, to
give the arbitral tribunal an opportunity to resume the arbitral
proceedings or to take such other action, as in the opinion of
arbitral tribunal, will eliminate the grounds for setting aside
the arbitral award.From the aforesaid provisions it is patently clear that once a final award is
pronounced the mandate of the arbitrator terminates unless the circumstances specified in
Section 33 or Section 34(4) exist.
An arbitral award has been defined in Section 2 sub-section (c) of the 1996 Act to
include an interim award. After an interim award, which is also an award within the meaning
of Section 2(c), is made an application for interim relief would necessarily have to be made
before the learned tribunal under the amended provision of Section 17. Similarly, if after the
pronouncement of the final award there was an application to the arbitrator under Section 33
or an order of court in terms of Section 34 sub-section (4) an application for interim relief
would have to be made before the learned arbitrator.
However, where the mandate of the learned arbitrator has terminated with
pronoucement of the final award and there is no application under Section 33 and no order
of court under Section 34(4,) there can be no question of making application for interim
relief before the arbitral tribunal, the reason being that the arbitral tribunal has ceased to
function since its mandate has terminated.
Even otherwise the learned court might entertain an application for interim relief
after the constitution of a tribunal if the court finds that circumstances exist which might not
render the remedy provided under Section 17 efficacious.
In view of the uncertainty as to whether the arbitral tribunal can at all be said to be
functional and/or whether the mandate of the arbitral tribunal stands terminated, the learned
court was justified in entertaining the application under Section 9. May be reasons should
have been given by the learned Court below. However, a party obtaining an order in its
favour is not to suffer only by reason of the failure of the Court to give reasons if the order is
otherwise sustainable in law. We find no infirmity with the decision to grant interim relief.
For the reasons discussed above, the appeal along with the connected application is
dismissed. All other questions are kept open.Urgent certified photostat copy of this order, if applied for, be supplied to the
learned Advocates appearing for the parties, subject to compliance with all requisite
formalities.
( Indira Banerjee, J. )
( Sahidullah Munshi, J. )
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