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TMI Blog2022 (9) TMI 894X X X X Extracts X X X X X X X X Extracts X X X X ..... e arbitral award, but before its enforcement in accordance with Section 36 of the Arbitration Act. All that the Court is required to see is, whether the applicant for interim measure has a good prima facie case, whether the balance of convenience is in favour of interim relief as prayed for being granted and whether the applicant has approached the court with reasonable expedition. It is not in dispute that there is an award of Rs. 142 Crores in favour of the Respondent. No cogent ground has been made out even prima facie, for interference with the impugned award - Order 41 Rule 5 of the CPC provides for stay of decree upon furnishing of cash security. The High Court acted within the scope of its powers under Section 9 in passing the impugned judgment and order. There are no ground at all to interfere. The Appeals are dismissed - the High Court is requested to dispose of the pending applications of the Appellant under Section 34 for setting aside the award as expeditiously as possible, preferably within 3 months from the date of communication of this judgment and order. - CIVIL APPEAL NO. OF 2022 (Arising out of SLP(C) No. 4511 of 2021) CIVIL APPEAL NO OF 2022 (Arising out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In the meanwhile, the Appellant was directed to deposit 10% of the amount in its bank accounts, which is referred to in its affidavit of assets in the High Court at intervals of every 15 days. 9. Pursuant to the aforesaid order dated 24th July 2018, the Appellant filed its supplementary affidavit of assets. Two days later, on 20th August 2018, the Respondent filed an application being I.A. No. 11128 of 2018 for directions on the Respondent to deposit the awarded amount of Rs. 142,41,14,499/( Rupees One Hundred FortyTwo Crores, Forty One Lakhs, Fourteen Thousand, Four Hundred NinetyNine Only) along with interest @ 12% per annum from the date of the award till realisation of the awarded amount in the High Court. 10. Diverse interim applications were filed from time to time. On 20th March 2019, the Respondent filed another application being IA No.4259 of 2019, seeking orders for deposit of the awarded amount of Rs. 142,41,14,499/along with interest. 11. By a judgment and order dated 17th February 2020, a Single Judge of the High Court disposed of the application filed by the Respondent under Section 9 of the Arbitration Act being O.M.P (I) (COMM) No.523 of 2017 along with c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the earlier application filed by the Appellant under Section 36(2), the Appellant could have filed an intra court appeal from the order under Section 9 of the Arbitration Act. 15. Mr. Viswanathan argued that subsection (3) of Section 36 enables the court to grant stay of operation of the Award. The Court cannot, however, stay an award for the asking. An award can only be stayed for reasons to be recorded in writing. Moreover, for grant of stay in the case of an arbitral award for payment of money, the Court is to have due regard to the provisions for grant of stay in a money decree under the provision of the CPC. 16. The power under subsection (3) of Section 36 to grant stay of an award is coupled with the duty to impose conditions which could include the condition of securing the award by deposit in Court, of the amount of the Award. It may be true as argued by Mr. Vishwanathan that the Court may not impose condition for stay, if it deems appropriate not to do so. The power of Court to grant unconditional stay of an Award is not unfettered. The power of unconditional stay is subject to the condition in the second proviso that is: The Court is satisfied that a prima fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontract which is the basis of the award; or (b) the making of the award, was induced or effected by fraud or corruption, it shall stay the award unconditionally pending disposal of the challenge under Section 34 to the award. Explanation.-For the removal of doubts, it is hereby clarified that the above proviso shall apply to all court cases arising out of or in relation to arbitral proceedings, irrespective of whether the arbitral or court proceedings were commenced prior to or after the commencement of the Arbitration and Conciliation (Amendment) Act, 2015. 20. On the other hand, Section 9 of the Act provides the amendment as follows: 9. Interim measures, etc. by Court.- (1) A party may, before or during 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 a Court:- (i) for the appointment of a guardian for a minor or a 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 s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt to pass orders securing the amount in dispute in the arbitration and/or any interim measure or protection as may appear to the Court to be just and convenient. 25. For grant of interim relief under Section 9, the Court would have to consider the prima facie case. In this case, prima facie there is an award for a huge amount of Rs. 142 Crores against the Appellant. The Respondent has a strong case for interim relief. 26. It is settled law that grounds for interference with an award is restricted. Even before this Court, the Appellant has not been able to advert to any cogent and glaring error which goes to the root of the award. The contention of the award being opposed to the public policy of India, is devoid of any particulars whatsoever. 27. Under Section 36, where the time for making an application to set aside arbitral award has expired, the award might be enforced in accordance with the provisions of the CPC in the same manner as it were a decree of the Court. Section 36(2) makes it clear that filing an application for setting aside of an award under Section 34 is not to render the award unenforceable, unless the Court expressly grants an order of stay of operation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he court to be just and convenient , though such discretion has to be exercised judiciously and not arbitrarily. The court is, no doubt, guided by the principles which civil courts ordinarily employ for considering interim relief, particularly, Order 39 Rules 1 and 2 and Order 38 Rule 5; the court, however, is not unduly bound by their texts. As this court held in Nimbus Communications Limited v. Board of Control for Cricket in India (Per D.Y. Chandrachud J, as the learned Judge then was), the court, whilst exercising power under Section 9, must have due regard to the underlying purpose of the conferment of the power under the court which is to promote the efficacy of arbitration as a form of dispute resolution. The learned Judge further observed as follows: Just as on the one hand the exercise of the power under Section 9 cannot be carried out in an uncharted territory ignoring the basic principles of procedural law contained in the Code of Civil Procedure 1908, the rigors of every procedural provision in the Code of Civil Procedure 1908 cannot be put into place to defeat the grant of relief which would subserve the paramount interests of justice. A balance has to be draw ..... X X X X Extracts X X X X X X X X Extracts X X X X
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