Section 9 of the Arbitration Act cannot be used as a substitute for adjudicating or granting final monetary reliefs.

The Petitioner was awarded a contract by GAIL (Respondent) on 28.05.2018 for terminal station works in Gorakhpur.

Despite project delays due to site encumbrances and waterlogging, the work was completed on 30.11.2022, and the Defect Liability Period expired on 29.11.2023.

The Petitioner alleged that GAIL withheld admitted dues of approximately ₹2.08 Crores and encashed a Performance Security of ₹54,03,960/-.

The Respondent allegedly linked these payments to disputes in separate contracts (DDPL Part-A and Part-B), despite a previous court undertaking in O.M.P.(I)(COMM.) 191/2025 not to make such cross-recoveries.

The Petitioner approached the High Court under Section 9 of the Arbitration and Conciliation Act, 1996, seeking the release of these "admitted" dues and protection against unlawful deductions.

1. Whether a petition under Section 9 of the Arbitration and Conciliation Act, 1996, can be maintained for the final release of alleged contractual dues in the absence of exceptional circumstances

2. Whether the Petitioner demonstrated imminent dissipation of assets or frustration of arbitral remedy to justify an interim order securing the claim amount

The court primarily applied Section 9 of the Arbitration and Conciliation Act, 1996, which empowers a court to grant interim measures of protection, such as securing the amount in dispute or preserving property, before or during arbitral proceedings.

The court applied the principle that Section 9 is intended for "interim measures of protection" and is not a substitute for the final adjudication of monetary claims or a mechanism for granting final relief at a preliminary stage.

It further relied on the doctrine that to secure an amount under Section 9, a party must demonstrate exceptional circumstances like the imminent dissipation of assets or the potential frustration of the arbitral award.

The Court observed that while the Petitioner framed the prayer as one for "securing" the amount, the actual substance was a demand for the payment of contractual dues.

The Court reasoned that Section 9 cannot be used to bypass the adjudication process for monetary disputes involving deductions, retentions, and cross-adjustments, as these are matters for the arbitral tribunal.

Upon reviewing the record, the Court found no evidence of "exceptional circumstances"—such as the Respondent’s financial instability or attempts to alienate assets—that would render a future arbitral award unenforceable.

Consequently, the Court held that a mere claim for money, even if characterized as "admitted dues," does not automatically warrant an interim order under Section 9.

It held that the relief sought (release of payments) did not warrant the exercise of jurisdiction under Section 9 as it sought a final monetary remedy rather than an interim protective measure.

The Petitioner was directed to invoke the dispute resolution clause and pursue arbitral remedies in accordance with the law.