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2025 Supreme(Raj) 2041
IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR
ASHOK KUMAR JAIN, MUKESH RAJPUROHIT (V. J.)
The Indian Hotels Company Limited – Appellant
Versus
Jai Mahal Hotels Pvt. Ltd. – Respondent
D.B. Civil Misc. Stay Application No. 2459 of 2025 in D.B. Civil Miscellaneous Appeal No. 2357 of 2025
Decided on : 06-06-2025
For the Appellant :Major R.P. Singh, Senior Advocate, through VC assisted by Mr. Hemant Kothari, Ms. Pallavi Shroff, Ms. Shruti Sabharwal, Surabhi Lal, Mr. Shubham Vijay and Mr. Ashish Poonia, Advocates
For the Respondent: Mr. Abhishek Kumar Rao Mr. Shailesh Suman Mr. Devashish Pancholi
A Commercial Court cannot impose unjust conditions in interim relief without jurisdiction, especially when disputes fall under the purview of an Arbitral Tribunal.
Headnote:(A) Arbitration and Conciliation Act, 1996 - Sections 9 and 37 - Appeal against interim relief granted by Commercial Court without jurisdiction - Court upheld that the conditions imposed by the Commercial Court were unreasonable and went beyond its authority, causing imbalance between the parties (Paras 5, 12, 20, 24).
(B) Legal Principles - Restrictions on jurisdiction of Commercial Court under Section 9; conditions imposed in interim relief must conform to established contractual agreements and not exceed the tribunal's authority (Paras 6, 10, 12).
(C) Burden of restitution of benefits obtained through interim orders (Para 22).
Facts of the case:
The appellant filed a miscellaneous appeal against an order denying stay of certain conditions imposed by the Commercial Court regarding license fees and property encroachment, which the appellant argues were unjust and beyond the court's jurisdiction.
Findings of Court:
The court found that the interim relief granted by the Commercial Court overstepped its authority and imposed unreasonable conditions on the appellant, leading to dismissal of the stay application.
Issues: Whether the Commercial Court exceeded its jurisdiction in imposing interim conditions and the appropriateness of the license fee directive.
Ratio Decidendi: The court reasoned that the Commercial Court acted unreasonably and capriciously, ignoring relevant facts in determining relief that should be adjudicated by the Arbitral Tribunal.
Result: Stay application is hereby dismissed.
| Table of Content |
|---|
| 1. appeal under arbitration act initiated. (Para 1) |
| 2. background and jurisdictional challenges discussed. (Para 4 , 5 , 6) |
| 3. provision for interim measures in arbitration highlighted. (Para 9 , 10) |
| 4. limitations of appellate review under the arbitration act noted. (Para 12 , 13) |
| 5. essentials for interim relief under section 9 outlined. (Para 14 , 15 , 16) |
| 6. equity in litigation and restitution principles emphasized. (Para 18 , 19) |
| 7. duty to restore other party's losses when court orders benefit one party. (Para 21 , 22) |
| 8. excess land usage not endorsed by arbitration terms. (Para 23 , 24) |
| 9. application for stay denied, case dismissed. (Para 26 , 27 , 28) |
Order :
MUKESH RAJPUROHIT (V. J.), J.
1. Instant D.B. Civil Miscellaneous Appeal is filed by appellant-petitioner filed under Section 37 of Arbitration and Conciliation Act, 1996 (hereinafter referred as ‘Act of 1996’) aggrieved and dis-satisfied from order dated 28.03.2025 in misc. application No. 01/2025 (CIS No. 2/2025) passed by learned Commercial Court No.1, Jaipur Metro, Jaipur whereby an application under Section 9 of Act of 1996 was allowed on certain conditions.
2. By this order we are only considering stay application No. 2459/2025, wherein the appellant has made a prayer to stay effect and operation of para Nos. 77 to 80 of impugned order dated 28.03.2025.
3. Before considering the stay application we are reproducing para Nos. 77 to 80 as under:-
77-c'krsZ fd fo}ku e/;LFkrk vf/kdj.k ds vfUre iapkV ds v/;/khu (subject to final award passed by the learned Arbitral Tribunal) izkFkhZ dh vksj ls vizkFkhZ dks fnukad 02-06-1984 ls fnukad 31-05-2024 rd dh vof/k esa vf/kd mi;ksx esa fy;s tk jgs {ks= ds cnys ykblsal Qhl ds rkSj ij :i;s 1]52]00]000@& ¼:i;s ,d djksM+ ckou yk[k½ dh jkf'k dh 90 fnol ds vUnj vnk;xh dh tkosxh rFkk fnukad 01-06-2024 ls c<+h gqbZ ykblsal Qhl dh jkf'k :i;s 84-00-000@& ¼:i;s pkSjklh yk[k½ izfro"kZ dh nj ls vnk;xh dh tkosxhA
78- c<+h gqbZ ykblsal Qhl dh jkf'k :i;s 84]00]000@& ¼:i;s pkSjklh yk[k½ izfro"kZ dh nj ls fnukad 01-06-2024 ls fnukad 31-03-2025 rd dh 10 ekg dh :i;s 70]00]000@& ¼:i;s lRrj yk[k½ dh jkf'k Hkh izkFkhZ dh vksj ls vizkFkhZ dks 90 fnol ds vUnj vnk dh tkosxh rFkk fnukad 01-04-2025 ls ns; ykblsal Qhl dh jkf'k :i;s 84]00]000@& ¼:i;s pkSjklh yk[k½ izfro"kZ dh nj ls ykblsal ds izkjafHkd djkj fnukafdr 28-08-1985 esa r; ikbZ xbZ 'krZ ds vuqlkj Nekgh vUrjky ij vnk dh tkrh jgsxhA
79- ;fn fnukad 31-05-2029 rd izLrkfor e/;Lfkrk dk;Zokgh dk fuLrkj.k ugha gksrk gS rks izkFkhZ dh vksj ls dqy :i;s 6]00]000@& ¼:i;s N% yk[k½ izfro"kZ dh c tkosxhA
80- ;g Li"V fd;k tkrk gS fd izkFkhZ dh vksj ls mijksDr 'krksZa dh ikyuk ugha fd;s tkus ij ,oa 90 fnol ds vanj izkFkhZ dh igy ij e/;LFkrk dk;Zokgh 'kq: ugha gksus dh fLFkfr esa ;g vkns'k Lor% gh fujLr gks tkosxk (Shall A stand automatically vacated) ”
4. A perusal of impugned order dated 28.03.2025 indicate that the relief granted also shows that respondent-non- petitioner was restrained and an order was passed in favor of appellant-petitioner and same is reproduced as under:-
76- vr% izkFkhZ dh vksj ls vf/kfu;e dh /kkjk 9 ds rgr izLrqr fd;k x;k gLrxr izkFkZuk i= Lohdkj fd;k tkdj vizkFkhZ dks vUrfje vkns'k@O;kns'k ds tfj;s ikcan fd;k tkrk gS fd izkFkhZ dks e/;LFkrk dk;Zokgh 'kq: gksus ,oa dksbZ vokMZ ikfjr gksus rd fookfnr ^t; egy iSysl gksVy* ds mlds dCts ds lEiw.kZ {ks= (whole area) ls csn[ky ugha fd;k sssssssssssssssssssssssssssssssssssssssssssssssssssssssssssssstkos] uk gh uksfVl fnukad 24-12-2024 ds vxzlj.k esa fdlh izdkj dh dksbZ dk;Zokgh vey esa ykbZ tkos rFkk fnukad 24-12-2024 dh fLFkfr ;Fkkor cukbZ j[kh tkosA (Status qua)
5. Learned Senior Advocate while referring the judgment in case of North Eastern Handloom & Handicraft Vs. Sports Station India Limited 2007 SCC Online Del. 2088 has submitted that aggrieved from repeated communication since April, 2022 and continuous threatening by respondent, an application under Section 9 of Act of 1996 was filed for interim relief. He further submitted that
