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2025 Supreme(Online)(Mad) 67325
IN THE HIGH COURT OF JUDICATURE AT MADRAS
N.ANAND VENKATESH, J
True Network Alliance Infra Private Limited – Appellant
Versus
Tejas Arts – Respondent
Arbitration Application No.845 of 2025 | Original Application No.649 of 2025
For the Appellants/Petitioners: Ms.S.P.Arthi
For the Respondents: Mr.Naveen Srinivasan
Interim injunctions under the Arbitration and Conciliation Act can be granted to prevent irreparable loss pending arbitration.
Headnote:(A) Arbitration and Conciliation Act, 1996 - Section 9 - Applications for interim injunction and appointment of Advocate Commissioner - The applicant sought an injunction to prevent respondents from dealing with assets stipulated in a Memorandum of Understanding pending arbitration. Court found prima facie case established for injunction and appointed a sole Arbitrator for dispute resolution. (Paras 1-10)
(B) Interim Relief - The court emphasized the need for preserving the subject matter pending arbitration, allowing applicants to avoid irreparable loss. (Paras 5-6)
Facts of the case:
The applicant entered a Memorandum of Understanding for the purchase of machinery valued at Rs.1,32,16,000/- and claimed part-payment of Rs.75,40,000/- against attempts by the respondents to dismantle and alienate the machinery prior to arbitration.
Findings of Court:
The Court determined sufficient grounds for granting an injunction and allowed the continuation of interim orders.
Issues: The necessity of interim relief to protect against irreparable harm pending arbitration proceedings.
Ratio Decidendi: The Court affirmed the importance of interim measures to secure the subject matter for effective arbitration and the feasibility of facilitating such measures under Section 9 of the Act.
Result: Applications granted.
| Table of Content |
|---|
| 1. request for interim injunction to protect assets during arbitration. (Para 1 , 2 , 3) |
| 2. court addresses necessity for interim relief to prevent irreparable harm. (Para 4 , 5 , 6) |
| 3. appointment of arbitrator for dispute resolution. (Para 7 , 8) |
For Respondents : Mr.Naveen Srinivasan [in both Applications] COMMON ORDER These applications have been filed under Section 9 of the Arbitration and Conciliation Act, 1996 [for brevity, hereinafter referred to as 'the Act'] for an order of interim injunction restraining the respondents their servants/agents/representative etc., from in any manner removing, disposing of, transferring or creating any third party rights over schedule of assets pending final adjudication of disputes between the parties through arbitration..
2. The applicant has also sought for appointment of an Advocate Commissioner to visit the premises and to take inventory of all the schedule of assets available in the premises and submit a report before this Court.
3. When these applications came up for hearing on 27.06.2025, this Court passed an interim order in O.A.No.649 of 2025 in the following terms:
"This petition has been filed under Section 9 of the Arbitration and Conciliation Act, 1996 , seeking for an order of interim injunction to restrain the respondents from removing, disposing of, transferring or creating third party rights over or dealing with the Plant and machineries / equipments / accessories morefully described in the schedule to the Judges Summons.
2. The applicant had entered into a Memorandum of Understanding, dated 29.03.2025 with the 1st respondent under which, the Plant and machineries / equipments / accessories morefully described in the schedule to the Judges Summons were agreed to be bought from the respondents by paying a total consideration of Rs.90,00,000/- on or before 31.03.2025. However, according to the applicant, subsequently, the said Memorandum of Understanding was revised and the total consideration payable by the applicant to the respondent was revised to Rs.1,32,16,000/-. The applicant has also placed on record before this Court, the invoice raised by the 1st respondent, dated 08.05.2025 in favour of the applicant for the purchase of the Plant and machineries / equipments / accessories morefully described in the schedule to the Judges Summons. The applicant has stated in the affidavit filed in support of this application that the applicant was always ready and willing to pay the balance sale consideration and purchase the Plant and machineries / equipments / accessories morefully described in the schedule to the Judges Summons from the respondents. According to the applicant, they have already paid a sum of Rs.75,40,000/- to the respondents towards part sale consideration, out of the total sale consideration of Rs.1,32,16,000/-. The applicant claims that no time limit has been fixed for payment of the balance sale consideration by the respondents.
3. Subsequent to the revision of the Memorandum of Understanding, dated 29.03.2025, the applicant claims that it had recently noticed that the respondents are attempting to dismantle the Plant and machineries / equipments / accessories morefully described in the schedule to the Judges Summons and they are attempting to alienate the same to third parties. The applicant claims, if that is allowed to happen, they will be put to irreparable loss and hardship. Photographs have also been filed along with this application to support the applicant's contention that the respondents are dismantling the plant and removing the same from the premises. The ledger statement sent by the respondents to the applicant has also been filed along with this application to establish the case of the applicant that a sum of Rs.75,40,000/- has already been paid by the applicant to the respondents towards part sale consideration for the purchase of the Plant and machineries / equipments / accessories morefully described in the schedule to the Jud
