Interpreting ‘enforced’ Under Section 9 Of The Arbitration And Conciliation Act, 1996: Madras High Court Holds Section 9 Application Is Maintainable Until Complete Satisfaction Of Award

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One of the critical aspects of arbitration is the enforcement of the arbitral award. Once an arbitral award is passed, it becomes binding on the parties involved. However, enforcing an arbitral award can sometimes be a challenging task, and parties may seek interim relief to safeguard their interests. In such cases, Section 9 of the A&C Act provides for interim relief to the parties.

The present case, O.A.No.284 of 2023, is about an Original Application filed by the applicant seeking interim injunction against the respondents for relief against their making of a web series called Queen-2 without making payments under the arbitral award. The respondents argued that the application is not maintainable because the award is already enforceable, and the applicant should file an execution petition. The applicant argued that Section 9 of the A&C Act allows them to file an application for interim orders after the award’s passing but before its enforcement. The court had to determine whether the application is maintainable.

The court examined Section 9 of the A&C Act and held that the word “enforced” means until complete satisfaction of the award. The court cited precedent and concluded that the present application is maintainable. The court clarified that only the successful party (award holder) in the arbitration proceedings is entitled to seek interim protection towards their award from the Courts. The unsuccessful party in the arbitration proceedings (award debtor) is not entitled to seek any remedy under Section 9, except challenging the award under Section 34.

The court also discussed the scope of Section 9, which is limited to the subject-matter of the arbitration and does not extend to discovering the assets of an award-debtor or ordering arrest or detention of the award-debtor. The court noted that the law laid down by the Hon’ble Apex Court in ”Hindustan Construction Company” case was not considered in the judgment of the Hon’ble Division Bench in ”Gopuram Enterprises Ltd. Versus M/s.Integrated Finance Company Ltd.” and therefore, applies the ratio laid down by the Hon’ble Division Bench of the Bombay High Court in ”Dirk India Pvt.Ltd.” case, which was subsequently approved by the Hon’ble Apex Court.

The court has made it clear that the interim protection of the award is available under Section 9 of the A&C Act and is intended to safeguard the fruit of the proceedings until the eventual enforcement of the award.