( 1 ) THIS order disposes of I. A. 4412/94 and I. A. No. 5240/94.

( 2 ) THESE proceedings have arisen out of a petition under Section 41 read with Schedule II of the Indian Arbitration Act, 1940.

( 3 ) THE petitioner is a public sector undertaking. The respondent is a company incorporated under the Companies Act, 1956. They are parties to an agreement under which the respondent has availed advances for making tests on portable steel bridges superstructures using patented Qadricon system for procurement of plant, machinery, equipment as also raw material for execution of tendered work of Govt of Bangladesh awarded to the respondent. Between the parties there have arisen disputes which form subject matter of arbitration which is pending. The respondent has entered into yet another contract with the Chief Engineer (Purchases) of the Northern Railway, Baroda House, New Delhi. The work under that contract is known a Akhnoor Bridge Project. According to the petioner, the respondent in executing such other works, is taking aid of test certificates achieved by using the petitioner s advances and by using petitioner s plant, machinery, equipment, left over raw materials/steel sections,etc. The respondent having already received substantial amounts in execution of such other work, is due to receive more than Rs. 30 lakhs from the abovesaid Akhnoor Bridge Project. I. A. 4412/94 has been filed by the petitioner under Order 39 Rules 1-2 read with Schedule II and Section 41 of the Arbitration Act seeking a restraint order against the respondent from receiving any amount receivable by it from Chief Engineer Purchases of Northern Railway on account of Akhnoor Bridge Project.

( 4 ) THOUGH order was yet-to be passed on I. A. 4412/94, it appears that the petitioner as on 20. 5. 94, addressed a letter to the General manager Northern Railway Headquarters requesting the latter not to release any amount to the respondent because the release of amount may prejudice adversely the. recovery which the petitioner is likely to make from the respondent hopefully under the award which is yet to be given by the Arbitrator. 4. 1 On 31. 5. 94, the respondent has filed I. A. No. 524w94 styled as an application under Section 41 read with Schedule II of the Arbitration Act, 1940 and Section 151 Civil Procedure Code whereby it has sought for a restraint order against the petitioner from interfering (i) in the business activities of the respondent and (ii) in receiving the amount of Rs 30 lakhs approximately from the office of the Chief Engineer Northern Railway, Baroda House New Delhi relating to the work executed at Jammu in respect of Akhnoor Bridge Project. The respondent also seeks a direction to the petitioner to inform the Chief Engineer Northern Railway that the amount payable by the latter to the respondent cannot be withheld at the instance of the petitioner. 4. 2 Thus, in short, the two applications seek reliefs diametrically opposed to each other.

( 5 ) LET it be noted at the very outset that the Chief Engineer Northern Railway is not a party to these proceedings. He is also not a party to the contract entered into between the parties and the disputes forming subject matter of arbitration before the Arbitrator. So also, the petitioner herein is neither a party nor has anything to do with the contract entered into by the respondent with the Chief Engineer Northern Railway relating to Akhnoor Bridge Project.

( 6 ) BOTH the applications have been seriously contested by the two nonapplicants of the two applications. Though the learned counsel for the parties have made their exhaustive submissions on the meritworthiness of the two applications, the major part of their arguments centers around the. provisions contained in Section 41 and Second Schedule of the Arbitration Act. The scope and extent of power exercisable by the Court and the nature of interim relief which can be allowed by the Court during the pendency of the arbitration proceedi