Section 9 of Arbitration and Conciliation Act grants wide powers to courts for securing amounts in dispute to prevent asset diminishment before enforcement of arbitral awards.

JUDGMENT :

Soumen Sen , C.J .

This appeal under Section 37 (1)(b) of the Arbitration and Conciliation Act, 1996 (in short “A & C Act, 1996”) is filed against the order dated 24 February 2026 in OP(ICA) No.1 of 2025, to the extent it denies an interim relief of securing the awarded sum and disclosing the assets by an affidavit under Section 9 of the said Act.

2. The appellants/petitioners are foreign companies. The Arbitral Award was put to execution and the execution application is pending. During the pendency of the said proceeding, an application under Section 9 of the A & C Act, 1996 was filed praying, inter alia, for attachment before judgment. The said application appears to have been necessitated by reason of the fact that the appellants were apprehensive of ultimately realising the awarded sum as there has been a failed attempt on the part of the respondent to invoke the provisions of the Insolvency and Bankruptcy Code.

3. Mr. Bharucha Zarir Pesi, the learned Senior Counsel appearing on behalf of the appellants, submitted that when the fraudulent intent of the respondent is clear and borne out from the records, there is an imminent necessity for a direction upon the respondent to deposit the entire awarded sum, apart from filing an affidavit of assets disclosing both movable and immovable properties as well as the details of the bank accounts. The learned Senior Counsel has referred to paragraphs 13 and 16 of the impugned order to show that the learned Single Judge has accepted that under Section 9 (1)(ii)(b) of the A & C Act, 1996, the Court has jurisdiction to pass interim orders to secure the amount in dispute in the arbitration even after the arbitral award is passed, until it is enforced and the Court has jurisdiction to direct the respondent to deposit the amounts under the arbitral award in exercise of the powers under of the A & C Act, 1996, despite the same being the main relief sought in the execution petition. In appropriate cases, when other measures are not effective to secure the amounts in dispute, the Court is required to pass such direction for the ends of justice. The Court has, however, limited its jurisdiction to the extent of granting an order of injunction restraining the respondent from withdrawing any amount from its bank accounts and also from alienating or creating any encumbrance on any movable or immovable properties owned by it, which is inadequate to protect the claim of the appellants.

4. The learned Senior Counsel submitted that the Hon’ble Supreme Court in the case of Essar House Private Limited v. Arcellor Mittal Nippon Steel India Limited , (2022) 20 SCC 178 , has analysed the scope and ambit of Section 9 of the A & C Act, 1996 and clearly enunciated the law. The Hon’ble Supreme Court has proceeded even to the extent of observing that besides the specific power of securing the amount in dispute, the Courts have been empowered to pass any interim measure of protection, keeping in view the purpose of the proceedings before it. The technicalities of the Code of Civil Procedure cannot prevent the Court from securing the ends of justice. It is thus submitted that having regard to the fraudulent intent and motive of the respondent as would be reflected from their attempt to invoke the Insolvency and Bankruptcy Code, the learned Single Judge ought to have exercised such power, as envisaged under (1)(ii)(b) of the A & C Act, 1996, by securing the entire claim of the awarded sum