Interim injunction based on a non-binding term sheet is impermissible where definitive agreements remain unexecuted.

The Appellant (a real estate developer) and Respondents executed a Term Sheet on 29.03.2023 for the acquisition of 100% shareholding in Respondent No. 2 (JVCo), which held a lease for a 40,315.80 sq. meter IT project land in Noida

The Appellant paid an advance of Rs. 2 Crores

Subsequently, NOIDA cancelled the land allotment on 26.06.2023 due to regulatory non-compliance

Between May and July 2023, the Respondents refunded the entire Rs. 2 Crores to the Appellant, who accepted it without recorded protest

After the Respondents got the allotment restored and launched a new project ("ONYX") with third-party interests, the Appellant sought an interim injunction under Section 17 of the Arbitration & Conciliation Act, 1996

The Sole Arbitrator rejected the injunction on 22.11.2025, leading to this Section 37 appeal

Whether the Term Sheet dated 29.03.2023 constituted a concluded and binding contract capable of specific performance

Whether the Arbitral Tribunal’s refusal to grant interim measures under Section 17 warrants interference under the limited appellate scope of Section 37(2)(b)

Whether the Appellant satisfied the "triple test" (prima facie case, balance of convenience, and irreparable loss) for the grant of an injunction

The Court applied Section 37(2)(b) of the Arbitration & Conciliation Act, 1996, noting that appellate interference is limited to orders that are perverse, patently illegal, or suffer from jurisdictional infirmity

It relied on *Wander Ltd. v. Antox India (P) Ltd.* regarding the restricted nature of appellate power over discretionary orders

*Dinesh Gupta v. Anand Gupta*, which equates the standards of Section 37 with the narrow grounds of Section 34

Furthermore, it applied the principle from *Mayawanti v. Kaushalya Devi*, holding that specific performance requires certain terms and a clear *consensus ad idem*, which is absent in preliminary negotiations

The Court observed that the Term Sheet's header explicitly stated "For Discussion Purposes Only" and captured only "broad terms of understanding"

It found that "Definitive Documents" required under Clauses 7 and 8 were never executed, indicating the contract was not concluded

The Court highlighted that the Appellant accepted the refund of Rs. 2 Crores without protest and remained silent for nearly a year while the Respondents revived the project

Regarding the "triple test," the Court determined that the balance of convenience favored the Respondents and the 550 third-party allottees who had already purchased 375 units, as an injunction would jeopardize their interests and breach NOIDA’s completion timelines

The Court concluded the Arbitrator’s view was a "plausible" interlocutory finding that did not meet the threshold for patent illegality

It held that the Appellant failed to establish a *prima facie* case as the Term Sheet was tentative and subject to unfulfilled conditions precedent

The Court further held that since the Appellant accepted the refund and delayed legal action, no irreparable injury was shown that could not be compensated by the alternate claim of damages already filed

The prayer for interim injunction against the construction and sale of the "ONYX" project was denied