IMPORTANT POINT
The court clarified that the initiation of arbitral proceedings is marked by the notice of appointment of an arbitrator, and the court retains the discretion to extend interim measures beyond the statutory 90-day limit.

JUDGMENT :

(Dinesh Mehta, J.) :

1. Instant appeal which has been preferred under Section 13 of the Commercial Courts Act, 2015, calls in question, the order dated 24.01.2024, passed by the learned Commercial Court, Bhilwara, whereby the appellant’s request for extending the interim order dated 10.10.2023 was refused.

2. The facts precisely narrated are that the appellant had moved an application dated 19.09.2023 under section 9 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “the Act of 1996”) with assertion that in relation to an agreement dated 10.12.2009, a dispute has arisen between the parties and as per clause 31 of the said agreement which was to be resolved by way of arbitration. And accordingly, invoking clause 31, the appellant appointed Mr. Satyanarayan Derashri as an Arbitrator and initiated the proceedings as required. But as the respondent is not taking any interest, the proceedings in terms of clause 31 and decision by way of Arbitration is likely to take some time. It was thus, prayed that until the dispute is resolved by the Arbitrator and award is passed, by way of interim measure the respondent be restrained from alienating the property or from raising construction on the disputed land and also be directed to maintain status quo.

3. Pursuant to the application aforesaid, the Commercial Court passed an order dated 10.10.2023 and directed the parties to maintain status quo in relation to the land (Khasra Nos.3021, 3022, 3023 of Tehsil Bhilwara) in dispute.

4. Thereafter, on 18.01.2024, the appellant moved this Court by way of filing an application under section 11 of the Act of 1996, for securing appointment of Arbitrator.

5. During the pendency of above referred application viz. Civil Misc. Case No.15/2023, pending before the Commercial Court, it was contended by the respondent that the order dated 10.10.2023 had a life of 90 days only, per force provision of section 9(2) of the Act of 1996. Faced with such stand, the present appellant filed an application dated 11.12.2023 with a prayer to pass further orders under section 9 of the Act of 1996 or to extend the interim order dated 10.10.2023.

6. The appellant’s said application was rejected and the application (Civil Misc. Case No.15/2023) filed under section 9 of the Act itself was disposed of by the Commercial Court on 24.01.2024. While rejecting the application (Civil Misc. Case No.15/2023), the Commercial Court observed that the appellant was required to take up the arbitral proceedings within a period of 90 days i.e. on or before 10.01.2024, whereas the application under section 11 of the Act of 1996 came to be filed before Hon’ble High Court belatedly, on 18.01.2024. According to the Commercial Court as the appellant had failed to take up the proceeding for securing appointment of Arbitrator within the statutory timeline of 90 days, no indulgence can be granted.

7. Mr. Taimini, learned counsel for the appellant argued that Commercial Court has erred in non-suiting the appellant on the ground that it has not taken up the arbitral proceedings under section 11 of the Act of 1996, within a stipulated period (upto 10.01.2024).

8. He invited Court’s attention towards section 21 of the Act of 1996 and submitted that arbitral proceedings should be deemed to have commenced on 12.07.2023-when the notice of appointment of Arbitrator was received by the respondent. He argued that as a matter of fact and law, the arbitral proceedings had already commenced and the mandate of section 9(2) of the Act of 1996 had been met.

9. Learned counsel for the appellant submitted that when the appellant has already filed an application under section 11 of the Act of 1996 before the High Court, it was upon the learned Commercial Court to have either passed a fresh order under section 9 of the Act of 1996 or to have extended the interim order dated 10.10.2023 for a further period.

10. Mr. Saruparia, learned counsel for the respondent vehemently opposed the app