Section 9 Petition may be treated as Section 17 Application upon consensual reference to Arbitration.

The Petitioner filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996, seeking urgent interim reliefs against the Respondent, GAIL (India) Ltd.

The dispute arose from a Notice of Termination dated 27.03.2026 regarding two Letters of Award (LOAs) dated 18.04.2024.

The Petitioner sought to restrain the Respondent from acting on the termination, encashing bank guarantees totaling Rs. 38,34,504/-, and placing the Petitioner on a "Watch List" or "Holiday List" (Yellow/Red Card).

During the hearing, both parties consented to refer the disputes to arbitration rather than adjudicate the Section 9 petition in court.

1. Whether the court should appoint a sole arbitrator and dispense with statutory notices under Section 21 and 11 of the Act given the mutual consent of the parties?

2. Whether the Section 9 petition for interim measures should be converted into an application under Section 17 to be decided by the Arbitral Tribunal?

Section 9 of the Arbitration and Conciliation Act, 1996, which allows parties to seek interim measures before or during arbitral proceedings.

Section 17 of the Act, which empowers an Arbitral Tribunal to grant interim relief.

The court bypassed the procedural requirements of Section 21 (Notice of commencement) and Section 11 (Appointment of arbitrators) based on the "peculiar facts" and mutual consent of the parties.

Clause 5.3B(a) of the General Conditions of Contract (GCC) - Services, which governs the issuance of "Yellow Cards" (Watch List) for poor performance.

The court observed that since both parties were ad idem (in agreement) that the disputes should be settled via arbitration, a prolonged litigation over the Section 9 petition was unnecessary.

To ensure the "commencement of arbitral proceedings... should not be unduly delayed," the court exercised its discretionary power to dispense with the formal Section 21 notice and the filing of a separate Section 11 petition.

Addressing the Petitioner's fear of being blacklisted, the court emphasized that the Respondent remains bound by the contractual terms of Clause 5.3B(a), which permits a "Yellow Card" vendor to still participate in other ongoing or new contracts.

The court determined that the Arbitral Tribunal was the more appropriate forum to evaluate the merits of the requested interim reliefs, such as the stay on bank guarantee encashment and the release of withheld payments.

It held that the present Section 9 petition shall be treated as an application under Section 17 of the A&C Act, to be adjudicated expeditiously by the learned Arbitrator upon entering the reference.

The Arbitrator’s fee shall be governed by the Fourth Schedule of the A&C Act. All rights and contentions of the parties were kept open for the Tribunal's decision.