Section 9 interim protection continues until the tribunal considers it, provided arbitration commences within three weeks.

The dispute arose from an Agreement for Sale dated 12 April 2025 between the parties concerning machinery and equipment supplied by the petitioner to the respondents.

Alleging non-payment of agreed dues and apprehending that the machinery might be alienated, encumbered, or otherwise dealt with, the petitioner filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996, seeking interim protection, inspection, security, and repossession-related reliefs.

By order dated 27 April 2026, the Court restrained the respondents from creating third-party rights, charges, or encumbrances over the machines until the next date of hearing.

On 23 September 2026, the Court noted that the petitioner had enjoyed the interim protection since April 2026 and directed it to take steps for constitution of the arbitral tribunal.

Whether the interim protection granted under Section 9 should continue indefinitely while the arbitral tribunal had not yet been constituted?

Whether the Section 9 petition should be placed before the arbitral tribunal as an application under Section 17 upon constitution of the tribunal?

Whether the interim arrangement should continue pending consideration of the matter by the arbitral tribunal, subject to its power to continue, modify, vary, or vacate it?

The Court applied Sections 9 and 17 of the Arbitration and Conciliation Act, 1996. Section 9 empowers the Court to grant interim measures before or during arbitral proceedings, while Section 17 empowers the arbitral tribunal to grant interim measures once constituted.

The Court also gave effect to the parties’ arbitration agreement under Clause 13.5 of the Agreement for Sale, which required unresolved disputes to be referred to a sole arbitrator appointed under the 1996 Act and specified New Delhi as the place of arbitration.

The governing principle applied was that court-granted interim protection in aid of arbitration cannot be allowed to continue indefinitely without the arbitral process being commenced; upon constitution of the tribunal, the interim matter should ordinarily be considered under Section 17.

The Court found that the arbitration agreement was operative and that the petitioner had already obtained interim protection restraining alienation or encumbrance of the machinery.

However, because the petitioner had continued to enjoy that protection since April 2026, the Court held that it could not permit the relief to operate endlessly without constitution of the arbitral tribunal.

Accordingly, it directed the petitioner to take appropriate steps for constitution of the tribunal within three weeks.

To preserve the subject matter of the dispute during this transition, the existing interim arrangement was continued until the learned Sole Arbitrator considered the matter.

The tribunal was expressly empowered to assess the matter independently and to continue, modify, vary, or vacate the interim protection.

Upon constitution, the Section 9 petition was to be treated as an application under Section 17 and placed before the Sole Arbitrator for consideration in accordance with law.

The interim restraint granted on 27 April 2026 was continued until the tribunal passed appropriate orders, subject to the tribunal’s power to modify, vary, or vacate it.

If the petitioner failed to commence arbitral proceedings within three weeks, the interim protection would automatically stand vacated.

All rights and contentions were kept open, and the petition and pending applications were disposed of accordingly.