Pre mediation rules: interim relief
The provision provides that in cases where a suit contemplates an urgent
interim relief, one is not required to compulsorily go through pre-
institution mediation. Another question concerning the kind of suits that
fall under the purview of suits contemplating relief was answered by the
Telangana High Court in the case of M/s M.K. Food Products v M/s
S.H. Food Products, where a civil petition was filed against an order of
the Commercial Court. The Commercial Court had returned the
plaint and instructed the parties to go for pre-institution mediation on
the ground that the suit didn’t contemplate any urgent interim relief.
The suit was concerned with an injunction on copyright infringement.
The Telangana High Court held that a suit of such a nature would fall
under the category of suit contemplating urgent interim relief and the
plaint should not have been rejected on the ground of non-exhaustion
of pre-institution mediation
in the case of …..GSD Constructions Pvt. Ltd v Balaji Febtech
Engineering, MANU/MP/0451/2019
the plaintiff had suffered because of a delay in the delivery of goods
who thereby refused to take the delivery of the goods. The plaintiff
then filed for an injunction to prevent the defendant from claiming
any further amount with respect to the delivery. The court held that
the plaintiff was running against time and seeking urgent interim
relief hence, he doesn’t need to exhaust the option of pre-institution
mediation. Thus, the courts have dispensed with pre-institution
mediation in such cases where making the party go through mediation
would result in an irreparable loss; irreparable loss being one of the
essential elements for the grant of an injunction.
Any party to the arbitration agreement can make an application for interim measures
in the course of the arbitral proceedings. However, after making of the arbitral award, only
a successful party which is entitled to seek the enforcement of the award can apply to
the court under Section 9 for protection in terms
of Section 9 (ii) of the Act.
There are no standards prescribed under the Act for grant of interim reliefs by a court under
Section 9 of the Act. Some courts have sought to apply standards under the Code of Civil
Procedure, 1908 (“CPC” or “Code”) such as Order 38 and 39
Courts have held that standards prescribed in the CPC would not be applicable to
proceedings under Section 9 of the Act and have held that if a party can merely show
that it has a good case on merits, it would be likely to succeed in obtaining an interim relief.
In these situations, courts have been guided by the principle that denial of the grant of such
interim reliefs would lead to injustice to the applicant or that the resultant award would be
rendered unenforceable/ un-executable if such reliefs are not granted.
The degree of the applicability of the provisions of the CPC to proceedings under Section 9
of the Act remains unsettled in light of the divergent opinions by various High Courts
(discussed below). Further, the Supreme Court in ….Arvind Constructions v. Kalinga
Mining Corporation and Others 26, despite recognising that there were divergent
decisions by various High Courts, left this question open to be considered in an
appropriate case. The Amendment Act 2015 does not address this lacuna and remains silent
with respect to standards that may be applicable in case of grant of interim reliefs by courts
under Section 9 of the Act.
From a reading of various decisions, we have distilled two lines of reasoning: an exclusive
approach and an inclusive approach. The former line of reasoning suggests that the rigours of
every provision in the CPC cannot be put into place to defeat the grant of relief provided
under Section 9 of the A&C Act. Whereas, the latter line of reasoning considers proceedings
under
interim relief: Arbitral tribunals have normally required irreparable harm; (b)
urgency; and (c) no prejudgment of the merits of the case. some cases tribunals have
also considered whether the party has established a prima facie case and that the
balance of convenience
Courts in India have at times shied away from importing principles contained in Order
XXXVII Rule 5 and Order XXXIX Rules 1 and 2 to the grant of interim reliefs under Section
9. Delta Construction Systems Ltd., Hyderabad v.M/SNarmada Cement Company Ltd,
Mumbai, (2002) 2 BomLR 225;
…National Shipping Company of Saudi Arabia v. Sentrans Industries Ltd. AIR 2004 Bom
136
Steel Authority of India v AMCI Pty Ltd (2011) 3 Arb LR 502;
Adhunik Steels Ltd. v. Orissa Manganese and Minerals Pvt. Ltd. AIR 2007 SC 2563
Order 38 rule 5: A plaintiff should show, prima facie, that his claim is bonafide and
valid and also satisfy the court that the defendant is about to remove or dispose of
the whole or part of his property, with the intention of obstructing or delaying the
execution of any decree that may be passed against him,
Order 39: 1: Rule 1 is all about the cases where the temporary injunction may be
granted.
2: Rule 2 is all about Injunction to restrain repetition or continuance of breach
2A: consequences of breach.
