Section 9 of the Arbitration Act only permits interim reliefs; final relief claims must be adjudicated by the Arbitral Tribunal.

ORDER

[VIA VIDEO CONFERENCING]

CM No.16979/2021 (for exemption)

1. Allowed, subject to just exceptions and as per extant rules.

2. The application is disposed of.

FAO(OS) (COMM) 76/2021 & CM No.16978/2021 (for stay)

3. This appeal, under Section 37 of the Arbitration and Conciliation Act, 1996 read with Section 13(1A) of the COMMERCIAL COURTS ACT , 2015, impugns the order dated 11th May, 2021 of the Commercial Division, of dismissal of OMP(I)(COMM) No.74/2020 preferred by the appellant.

4. The Commercial Division has dismissed the Section 9 application of the appellant, holding that (i) the relief claimed therein of directing the respondents to pay to the appellant Rs.1,89,91,737/-, was in the nature of a final relief which could not be granted in exercise of powers under Section 9 of the Act; and, (ii) the reliefs claimed, of permitting the appellant to continue and complete the works which were awarded by the respondents to the appellant, and of stay of operation of the notice issued by the respondents to the appellant to show cause why the works contract awarded by the respondents to the appellant should not be terminated, also could not be granted, considering the nature of the contract.

5. The counsel for the appellant has contended that out of the amount of Rs.1,89,91,737/- claimed by the appellant from the respondents, the respondents have admitted liability in the sum of Rs.1,15,31,770/- and the appellant was/is thus, in any case entitled to an order for payment of the said amount and which relief has been wrongly denied.

6. We have enquired from the counsel for the appellant, whether not grant of such relief on admissions would be in the nature of a final relief and which, only the Arbitral Tribunal, to whose adjudication the parties have agreed, is entitled to grant. Attention of the counsel for the appellant has been drawn to the recent dicta in National Highways Authority of India Vs. Bhubaneswar Expressway Private Limited, MANU/DE/0861/2021, where it has been held that Section 9 of the Act does not empower the Court to grant reliefs in the nature of final reliefs and that Section 9 has to be read along with Section 5 of the Act. Once Section 5 has been incorporated in the 1996 Act to curb the tendency of the Courts to adjudicate whatever is coming before them, the Courts have lost the jurisdiction to adjudicate such disputes except to the extent expressly permitted by the Arbitration Act. The Arbitration Act nowhere empowers the Court to grant a relief in the nature of final relief, even if admission of the opposite party thereto is shown. It is only the Arbitral Tribunal which can grant relief in the nature of a final relief, on admissions. Section 9 permits the Court only to grant interim preservatory measures of protection etc. The jurisdiction under Section 9 cannot extend to adjudicate what as per the agreement of the parties is to be adjudicated by the Arbitral Tribunal. Thus the question of grant of relief directing the respondents to pay to the appellant any amount, because the respondents have in the pleadings in any proceedings or elsewhere admitted liability to the appellant in the said amount, in exercise of powers under Section 9 , does not arise.

7. The Commercial Division, in the impugned order, with respect to the claim of the appellant of Rs.1,89,91,737/-, has also reasoned that it was not the case of the appellant that in the event of the award for the said amount being in favour of the appellant, the appellant would not be able to recover the said amounts