22 May 2015

Relief against third party in Arbitration

Relying on earlier judgments, the Delhi High Court has on 5-5-2015 held that while considering a petition under Section 9 of the Arbitration and Conciliation Act, the Court is within its right to pass order against third party. It was also held that when jurisdiction of the Court is invoked post-award by way of petition under Section 9, interim protection can be granted. Respondent’s argument that some of them were not parties before the Arbitral Tribunal and that they were independent entities under the Companies Act, and hence petition under Section 9 would not be maintainable, was rejected by the Court.

The Court however observed that it should restrain itself from passing an order which has the effect of implementing the award because such order would frustrate the challenge to the award under Section 34. It was held that the order should be such which would secure the interest of the party having the award in its favour so as to seek effective implementation if the challenge to the award is rejected.


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