2000 (9) TMI 968 - HC - Companies Law

Summary

Issues Involved:
1. Maintainability of the appeal under Section 37 of the Arbitration and Conciliation Act, 1996.
2. Interim measures of protection under Section 9 of the Arbitration and Conciliation Act, 1996.
3. Creation of third-party rights in the assets in question.
4. Jurisdiction and interpretation of 'judgment' under Section 10 of the Delhi High Court Act and clause 10 of the Letters Patent.

Detailed Analysis:

1. Maintainability of the Appeal:
The primary issue raised was whether the appeal was maintainable under Section 37 of the Arbitration and Conciliation Act, 1996. The respondent's counsel argued that the order dated 24-8-2000 was neither an order granting nor refusing to grant any measure under Section 9 of the Act, making it non-appealable. The court examined the nature of the order, concluding that it was purely interlocutory and did not constitute a 'judgment' as per the tests laid down in Shah Babulal Khimji v. Jayaben D. Kania [1981] 4 SCC 8. The court emphasized that the order was simply an adjournment and did not decide any substantive rights of the parties, thus making the appeal non-maintainable.

2. Interim Measures of Protection:
The appellant sought interim measures under Section 9 of the Arbitration and Conciliation Act, 1996, to prevent the creation of third-party rights in the pipeline assets. Initially, an ex parte ad interim order was passed on 4-8-2000, directing that any decision taken by the respondent would be subject to further orders of the court and requiring the respondent to keep accounts if the pipeline became operational. The appellant's request for further interim relief on 24-8-2000 was not granted, as the learned Single Judge was not inclined to pass any additional restraint order at that stage.

3. Creation of Third-Party Rights:
The appellant argued that the respondent's actions in transferring the pipeline to its subsidiary, Gujarat State Petronet Ltd., were illegal and violated the contractual provisions of the Production Sharing Contract and Joint Operating Agreement. The appellant sought to restrain the respondent from creating third-party rights in the pipeline assets until the arbitration was resolved. However, the court did not grant this interim relief, leading to the appellant's appeal.

4. Jurisdiction and Interpretation of 'Judgment':
The court analyzed whether the order dated 24-8-2000 could be considered a 'judgment' under Section 10 of the Delhi High Court Act and clause 10 of the Letters Patent. Referring to the Supreme Court's decision in Shah Babulal Khimji's case, the court noted that only orders deciding matters of moment or affecting vital rights could be considered judgments. The court concluded that the order in question was a routine interlocutory order, merely adjourning the hearing and not deciding any substantive rights, thus not qualifying as a 'judgment' for the purposes of appeal.

Conclusion:
The appeal was dismissed as not maintainable, with the court refraining from expressing any opinion on the merits of the case. The court's observations were not to prejudice the learned Single Judge in deciding the pending applications on merits, in accordance with the law. The judgment emphasized the importance of distinguishing between routine interlocutory orders and those affecting substantive rights when determining the appealability of orders under the Arbitration and Conciliation Act, 1996.