The main legal point established in the judgment is the wide scope of powers of the court to grant interim measures under Section 9 of the Arbitration and Conciliation Act, 1996, and the strict compliance required for commencing arbitral proceedings within a specified period.

JUDGMENT

Avinash G Gharote, J. - Heard Mr.Sanjeev Deshpande, learned Counsel for the appellant and Mr.Rajendra Deshmukh, learned Senior Counsel with advocate Mr.Nirmal Dayma, for the Respondent. For the sake of convenience, the parties are referred, as they were before the lower Court. The arguments have been advanced on Arbitration Appeal No.26 of 2021. Learned Counsels for the parties, submit that the facts and the legal position in Arbitration Appeal No.25 of 2021 are identical except for certain dates and fgures and, therefore, except for this variation, what has been argued in Arbitration Appeal No.26 of 2021, will equally apply to Arbitration Appeal No.25 of 2021.

2. The arbitration appeal no.26 of 2021 raises challenge to the judgment dated 11.05.2021, passed by the learned Principal District Judge, Jalgaon, in CMA No.34 of 2021 under Section 9 of the Arbitration and Conciliation Act, 1996 ("A & C Act, 1996", for short, hereinafter), whereby, the effect, operation and execution of the impugned notice dated 02.01.2021, issued by the Non applicant/appellant, has been stayed till the constitution of arbitral tribunal and the applicant/Respondent herein has been directed to take appropriate steps, within 90 days of the date of the order for commencement of the arbitral proceedings, failing which, it is directed that the impugned order shall stand vacated immediately.

3. It is not in dispute, that pursuant to the NIT for work of construction of major bridges in Manmad-Jalgaon Section, the offer of the applicant / Respondent herein was accepted and an agreement came to be executed on 11.04.2018 consequent to which, work order has been issued. It is also not disputed that the applicant has deposited an amount of Rs.2,95,39,390/- by way of security deposit with the non applicant. By the notice dated 02.01.2021, it was alleged, that various scheduled and non scheduled undue payments were given to the applicant for seven items as listed therein totaling Rs.66,49,110,42/-, which were to be recovered and, therefore, the said amount was asked to be deposited with the non applicant within 7 days therefrom.

4. Being aggrieved by the same, the applicant had approached this Court with Writ Petition No.2294 of 2021, however, in view of the arbitration clause 64, as contained in the agreement between the parties, this Court, indicated that the parties make take up the process of arbitration and disposed of the writ petition on 10.03.2021 with the above observation. It is in pursuant thereto, that an application under Section 9 came to be fled before the learned Principal District Judge, Jalgaon, which came to be registered as CMA No.24 of 2021, with the following prayer:

17.(a) Interim measure by way of stay to the effect, operation, execution and implementation of the recovery notice dated 02.01.2021 may kindly be stayed, till constitution of arbitral tribunal and commencement of arbitral proceedings.

5. The said application was opposed by the Non applicant and though it was admitted that an amount of Rs.2,95,39,930/-, was deposited by way of security deposit with the Railways/non applicant, however, by placing reliance upon clause 51.2 of the General Conditions of Contract (GOC hereinafter), which provided for post payment audit, it was contended that the non applicant had a right to recover the amount wrongfully paid to the applicant, which was to the tune of Rs.66,49,110.82 as detailed in para 3 of the reply.

6. The learned Principal District Judge, Jalgaon, by the impugned judgment dated 11.05.2021, allowed the application under Section 9 in the following terms:

"1 Application is allowed.

2 Applicant shall take effective steps as per Section 9(2) of the Arbitration and Conciliation Act for commencement of arbitral proceedings and it shall be commenced within a period of 90 days from the date of order.

3 In the meanwhile, till the constitution of Arbitral Tribunal, the effect, operation and execution of the impugned notice dated 02.01.2021 is