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MOUSHUMI BHATTACHARYA, NAGESH BHEEMAPAKA
Transformers and Rectifiers (India) Limited – Appellant
Versus
Vijai Electricals Limited – Respondent
JUDGMENT :
Moushumi Bhattacharya, J.
1. The present Appeal has been filed from an order dated 28.03.2022 passed by the Commercial Court at Hyderabad.
2. The appellant was the respondent No.1 in an application filed under section 9 of the Arbitration and Conciliation Act, 1996 which resulted in the impugned order. The respondent No.1 before us was the petitioner in the section 9 proceeding.
3. By the impugned order, the respondent No.1 (the petitioner before the Trial Court) was granted the relief sought for and the appellant was directed to extend the 3 Bank Guarantees furnished by the appellant to the respondent No.1 for 1 year from the date of the order. The respondent No.2 (then IDBI Bank and now Canara Bank) was directed not to release the security furnished by the appellant (respondent No.1 before the Trial Court).
4. The factual position is that the respondent No.1 herein has a back to back contract with its Algerian buyer and the appellant. The appellant is a supplier of the respondent No.1. The appellant approached the Commercial Court at Gujarat with a Suit for restraining the respondent No.1 from invoking the Bank Guarantees furnished by the appellant. The respondent No.1 file
Failure to comply with statutory obligations under the Arbitration and Conciliation Act, 1996 results in the expiration of interim orders, necessitating the appointment of an Arbitrator for dispute r....
Interim measures – Direction to furnish security in form of Performance Bank Guarantees is contingent upon fulfilment of certain conditions.
The court upheld the validity of interim relief under Section 9 of the Arbitration Act, emphasizing that strict adherence to procedural rules is not mandatory if a prima facie case exists.
Once an Arbitral Tribunal is constituted, Section 9 of the Arbitration Act prohibits further applications for interim relief unless the party shows that the remedy under Section 17 is ineffective.
The court reinforced that unilateral appointment of an arbitrator violates the Arbitration and Conciliation Act, leading to invalid proceedings, hence, a new arbitrator must be appointed.
The residuary clause of Section 9(1)(ii) of the Arbitration and Conciliation Act, 1996 does not cover orders passed by the Tribunal concerning the calculation of fee based on the interpretation of th....
The court emphasized the need to balance equities between the parties and highlighted the importance of following contractual provisions for submission of the final bill and processing thereof.
Expression “entertain” means to consider by application of mind to the issues raised. The Court entertains a case when it takes a matter up for consideration. The process of consideration could conti....
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