Legal Headline: Section 9 jurisdiction is limited to preserving the subject-matter of the arbitration agreement between the parties.

The Petitioner Society entered into a Development Agreement (DA) in 2013 for property redevelopment with the Respondent Developer

Following defaults in statutory dues, corpus payments, and transit rent, the Society filed a Section 9 Petition in 2017 seeking interim protection

On December 14, 2017, the Court attached various personal assets of the partners and issued a blanket injunction against the Developer from alienating any properties across all their projects

Subsequently, thirty-one interim applications were filed by third parties (allottees/tenants from unrelated projects and family members) seeking to recover dues or intervene in the proceedings

An Arbitral Tribunal was finally constituted in September 2024, and a Section 17 Order was passed in February 2026

1. Whether a Section 9 Court preserves jurisdiction to entertain applications from third parties who are not signatories to the arbitration agreement

2. Whether the Court should continue exercising jurisdiction under Section 9 once an Arbitral Tribunal has been constituted and has passed orders under Section 17

3. Whether blanket injunctions affecting unrelated projects should be maintained or relegated to the Arbitral Tribunal for reconsideration

The Court applied Section 9 and Section 17 of the Arbitration and Conciliation Act, 1996, noting that the jurisdiction is limited to "parties" as defined under Section 2(1)(h) for the preservation of the "subject-matter of the arbitration agreement"

The Court relied on the principle from Firm Ashok Traders v. Gurumukh Das Saluja regarding the necessity of a manifest intent to arbitrate

The Court integrated the doctrine of "veritable parties" or "non-signatories" as established in Cox and Kings Ltd. v. SAP India (P) Ltd., ASF Buildtech v. Shapoorji Pallonji, and Adavya Projects v. Vishal Structurals, which requires a non-signatory to show demonstrable proximity, consent, or a de facto connection to the dispute to be impleaded

The Court reasoned that Section 9 is not a standalone equity jurisdiction but is strictly aid-of-arbitration; therefore, the Society is the only "protectee" under this specific DA

The Court found that third-party decree-holders from unrelated projects lack privity and cannot "shoo-in" to Section 9 proceedings to execute money decrees obtained in other forums

Regarding the continuation of the December 2017 blanket injunction, the Court observed that under Section 9(3), once a Tribunal is formed, the Court must refrain from entertaining applications unless Section 17 is inefficacious

The Court concluded that since the Society’s claims (damages of ~Rs. 18.65 Crores) are now before the Tribunal, the Tribunal is the proper forum to assess whether the security currently held in Court (over Rs. 11 Crores) is sufficient or surplus

The Court directed: (i) the Arbitral Tribunal to assess within three months the amount required to secure the Society's claim; (ii) any surplus funds to be released to the Developer, subject to orders from other competent execution courts; (iii) Respondent partner Tejal Rupji to honor his undertaking to clear third-party decrees within 12 months of such release; and (iv) the Court Commissioner to handover all materials to an official Registry-designated Commissioner and be paid fees of Rs. 2,50,000