Arbitration  – Grant of Interim Order under Section 9 of the Act

It is well settled principle of law that normal rules governing grant of interim orders are applicable to the proceedings drawn and conducted under Section 9 of Arbitration and Conciliation Act as well. It is equally well settled that three necessary ingredients which are to be taken into consideration by any court for granting interim injunction under Order XXXIX, Rules 1 and 2 of the Code of Civil Procedure are to be taken into account by the Court while considering an application or petition under Section 9 of the Arbitration and Conciliation Act. In other words, if a party seeks any interim measures for protection, the court needs to consider such an application or petition on the basis of three cardinal principles for grant of any relief in the nature of interim injunction, i.e. a prima facie case, irreparable loss or injury or prejudice and balance of convenience.

         The purpose of grant of interlocutory order is primarily to preserve in status quo, the right of parties which may appear to the Court on the basis of prima facie case. The object of grant of such temporary injunction is to mitigate the risk of injustice to the plaintiff during the period a suit or arbitration proceedings are pending, i.e. till the period such proceedings are concluded.         

Hon’ble Supreme Court in the case of Hindustan Petroleum Corporation Limited v. Sriman Narayan, (2002) 5 SCC 760 has held that grant of an interlocutory injunction is a matter which requires exercise of discretion of the Court, however, while exercising such discretion the court should normally apply the tests of (i) whether the plaintiff has a prima facie case; (ii) whether the balance of convenience is in favour of the plaintiff; and (iii) whether the plaintiff would suffer an irreparable injury if his prayer for interlocutory injunction is disallowed. M/s Sri Sai Nath Associates v. Babasaheb Bhimrao Ambedkar University, 2022 (154) ALR 408.