Interim protection cannot preserve a conditional acquisition absent a prima facie right and present risk.

The parties executed a Binding Term Sheet and Addendum for the proposed acquisition of 100% of Respondent No. 4’s share capital, subject to staged payments, due diligence, regulatory approvals and other preconditions.

The Petitioner acquired 9.5% of the shares and claimed to have advanced ₹23.45 crore towards the transaction; the Respondents contended that those advances were loans under a separate Inter-Corporate Loan Agreement.

After Respondent No. 4 issued a notice purporting to terminate the transaction and seeking release of escrowed shares, the Petitioner disputed termination and sought interim protection under Section 9 of the Arbitration and Conciliation Act, 1996, including restraints concerning the shares and Respondent No. 4’s assets and operations.

The Court considered the parties’ competing accounts of their payment and performance obligations and the status of the transaction.

1. Whether the Term Sheet and Addendum created binding obligations, and what payment obligations they imposed on the parties.

2. Whether the ₹23.45 crore advanced by the Petitioner could be treated as performance of its obligations under the Term Sheet, rather than as loan advances.

3. Whether the Petitioner had established a sufficient basis for the interim and ad-interim protections sought under Section 9, including preservation of the escrowed shares and restraints affecting Respondent No. 4’s operations.

Section 9 of the Arbitration and Conciliation Act, 1996 empowers the Court to grant interim measures of protection in aid of arbitration; the relief must be justified by the rights shown and the need to protect the subject matter of the dispute.

Sections 51–54 of the Indian Contract Act, 1872 concern reciprocal promises and the circumstances in which a party’s performance may depend on the other party’s performance or readiness and willingness to perform; their application turns on the particular contractual obligation.

The Court also applied the governing transaction documents according to their terms: a binding term sheet may create enforceable obligations while making completion conditional on specified preconditions, and amounts advanced under a separate loan agreement do not become share-purchase consideration merely because the documents form part of an overall transaction.

No judicial precedents were cited.

The Court held that the Term Sheet was binding, but did not itself complete an unconditional transfer of all shares: completion remained dependent on due diligence, approvals, escrow arrangements and other preconditions.

The Addendum contemplated specified funding obligations, but did not impose an unconditional obligation to meet all of Respondent No. 4’s liabilities.

The contemporaneous Loan Agreement and related communications supported treating the ₹23.45 crore as loan advances, not as payment of the ₹5 crore purchase price.

The Petitioner had also failed to show that it paid the separate ₹52.50 lakh instalment by the contractual deadline; disputed defaults by the Respondents did not, on the material before the Court, establish that this payment was conditional on their performance.

Although the validity of termination and the parties’ respective performance remained disputed, the Court found that the Petitioner had not established an immediate right to completion or the necessity for the broad restraints sought.

Respondent No. 4’s later request that the escrow shares remain in status quo reduced the asserted immediate risk, while the wider prayers would interfere with Respondent No. 4’s corporate and operational affairs.

The Court clarified that its observations were confined to the Section 9 petition, kept all contentions open, and left the parties at liberty to seek appropriate interim relief before the arbitral tribunal; there was no order as to costs.