Section 9: Interim Measures by the Court, Before, During and After

Two observations. Clause (e) is a wide residual power, so the list is not really exhaustive. And the closing words import the court's ordinary powers, which is why the principles a court applies on a section 9 application resemble those it applies to an interim injunction in a suit: a prima facie case, the balance of convenience and irreparable injury.

Clause (b), securing the amount in dispute, is the workhorse of section 9 and is the closest thing in arbitration to attachment before judgment.

Section 9(2) and (3): what the 2015 amendment changed

Both sub-sections were inserted by the 2015 amendment, and each answers an abuse.

Section 9(2): where, before the commencement of the arbitral proceedings, a court passes an order for an interim measure under sub-section (1), the arbitral proceedings shall be commenced within ninety days from the date of that order, or within such further time as the court may determine.

The abuse it stops is obvious once stated. A party could obtain an injunction "in aid of arbitration" and then never start the arbitration, so that a temporary order became a permanent one without anybody ever deciding the merits. Ninety days ends that.

Note what "commenced" means here: section 21 defines the commencement of arbitral proceedings as the date on which a request for the dispute to be referred is received by the respondent, unless otherwise agreed. Chapter 320 works through section 21.

Section 9(3): once the arbitral tribunal has been constituted, the Court shall not entertain an application under sub-section (1), unless the Court finds that circumstances exist which may not render the remedy provided under section 17 efficacious.

This is the sub-section that changed practice. Before it, parties went to court throughout the arbitration. Now, once there is a tribunal, the tribunal is the forum, and a court will take an application only if it finds that the section 17 remedy may not be efficacious. That is a real test, not a formality, and it is what makes section 17 worth having.

The interaction with section 17

Emergency arbitrators, and where the Supreme Court met them

Institutional rules increasingly allow a party to obtain relief from an emergency arbitrator appointed within days, before the tribunal proper is constituted. The Act does not use the expression, and the question whether such an order is enforceable in India arose in Amazon.com NV Investment Holdings LLC v. Future Retail Ltd, decided 6 August 2021, in which the Supreme Court considered emergency arbitration under institutional rules against sections 17 and 9.

That judgment is in the queue in authorities/cases.json and has not been read for facts and holding, so this book does not state what it decided. Know the question and the case; read it before asserting the ratio.

A worked example

Nachiket's company has an arbitration clause with a supplier. He learns the supplier is about to sell the only two machines that could satisfy his claim, and that its bank balance is being moved out. No arbitrator has been appointed.

Can he apply now? Yes. Section 9(1) allows an application before arbitral proceedings.

Which court? The Court as defined in section 2(1)(e): the principal Civil Court of original jurisdiction in the district, or a High Court with ordinary original civil jurisdiction; a High Court if this were an international commercial arbitration.

What can he ask for? Preservation or interim custody of the machines under clause (ii)(a); an order securing the amount in dispute under clause (ii)(b); an injunction restraining the sale, or a receiver, under clause (ii)(d).

What must he then do? Commence the arbitration within ninety days of the order, or within such further time as the court allows, under section 9(2). If he does not, the foundation of the order goes.

Three months later the tribunal is constituted and he wants a further order. Now section 9(3) applies: the court shall not entertain the application unless it finds that circumstances exist which may not render the section 17 remedy efficacious. The ordinary course is to go to the tribunal.

The award is made in his favour and the supplier starts selling assets before he can execute. Section 9(1) is still available: it runs until the award is enforced in accordance with section 36.

What beginners get wrong

Section 9 is not confined to the period before the arbitration. It runs before, during, and after the award until enforcement.

The ninety day rule applies only to a pre-commencement order. An order made during the arbitration is not subject to section 9(2).

Section 9(3) is not an absolute bar. It is a test: the court may still entertain the application if the section 17 remedy may not be efficacious.

The court is not the same court in every case. It is whichever court answers section 2(1)(e), and for an international commercial arbitration that is a High Court.

A section 9 application does not require the arbitration to have begun, but it does require an arbitration agreement, because only a "party" may apply.

Quick revision

• Section 9(1): a party may apply before or during arbitral proceedings, or after the award but before enforcement under section 36, for a guardian, or for interim protection as to (a) preservation, interim custody or sale of goods, (b) securing the amount in dispute, (c) detention, preservation or inspection of property, with powers of entry, sampling and experiment, (d) interim injunction or a receiver, (e) any other measure just and convenient. The court has the same powers as in proceedings before it.
• Section 9(2), inserted 2015: where the order was made before commencement, the arbitration must be commenced within ninety days of the order or such further time as the court determines.
• Section 9(3), inserted 2015: once the tribunal is constituted, the court shall not entertain a section 9 application unless it finds circumstances that may render the section 17 remedy inefficacious.
• Amazon v. Future Retail (6 August 2021) concerns emergency arbitrators and sections 9 and 17. Unread here; do not state its ratio.

Test yourself

1. Name the three periods in which a section 9 application may be made. Before the arbitral proceedings, during them, and at any time after the making of the arbitral award but before it is enforced in accordance with section 36.

2. A party obtains an injunction under section 9 and then does nothing. What follows? Section 9(2) requires the arbitral proceedings to be commenced within ninety days from the date of the order, or within such further time as the court may determine. The rule exists to stop a pre-arbitration interim order becoming permanent.

3. The tribunal has been constituted. Can a party still go to court under section 9? Only if the court finds that circumstances exist which may not render the remedy under section 17 efficacious, under section 9(3). Otherwise the tribunal is the forum.

4. Which clause of section 9 is used to stop a respondent dissipating assets? Clause (ii)(b), securing the amount in dispute in the arbitration, often together with an injunction or receiver under clause (ii)(d).

5. Does section 9 give the court a closed list of powers? Not in substance. Clause (ii)(e) allows such other interim measure of protection as may appear to the court to be just and convenient, and the closing words give the court the same power to make orders as it has in proceedings before it.