Upon consensual appointment of an arbitrator, Section 9 petitions may be treated as Section 17 applications.

Kundan Industries Limited and Kuntek Fasteners Private Limited entered into a series of interconnected commercial agreements concerning manufacture of fasteners, assignment of trademarks, sale of machinery and a loan transaction. These included a Product Manufacturing Agreement dated 11 November 2024, an IP Assignment Agreement dated 24 April 2025, a Memorandum of Understanding and Agreement for Sale of Machinery dated 25 April 2025, and a subsequent Trademark Assignment Agreement dated 2 June 2025.

Under the IP Assignment Agreement, Kundan agreed to assign specified trademarks, together with associated goodwill and customer rights, to Kuntek for ₹5 crores. The subsequent MoU recorded an overall transaction of ₹55 crores, comprising ₹5 crores for the IP assignment, ₹35 crores for machinery situated at the Vasai factory, and ₹15 crores as a loan. The machinery agreement required Kundan to obtain a No Objection Certificate from the Bank of Baroda in respect of machinery charged to the bank.

Disputes arose concerning performance of the machinery transaction, payment obligations, procurement of the bank’s NOC and the effect of the overall transaction on the trademark assignment. Kundan purported to terminate the agreements, while Kuntek disputed the termination and claimed that the trademark assignment had been completed and was irrevocable. Both parties also objected to the other’s use of the disputed marks.

Arbitration was invoked on 4 July 2026. The parties filed cross-petitions under Section 9 of the Arbitration and Conciliation Act, 1996, seeking interim protection concerning the disputed trademarks. By consent, both parties waived the contractual and formal procedure for appointment of the arbitrator and agreed to reference the disputes to arbitration.

Whether the disputes arising from the interconnected agreements should be referred to arbitration and a sole arbitrator appointed by consent of the parties.

Whether the pending Section 9 petitions seeking interim protection in respect of the disputed trademarks should be treated as applications under Section 17 of the Arbitration and Conciliation Act, 1996.

Whether interim safeguards were necessary to preserve the status quo and protect the parties’ competing claims concerning the disputed trademarks pending consideration by the arbitral tribunal.

The Court applied the Arbitration and Conciliation Act, 1996, particularly Section 9, which permits courts to grant interim measures before or during arbitral proceedings; Section 17, which empowers the arbitral tribunal to grant interim measures after constitution of the tribunal; Section 12(2), requiring the arbitrator to furnish the prescribed disclosure; and the statutory framework governing appointment and conduct of arbitral proceedings.

The Court also applied the principle that, where parties mutually consent to arbitration and waive the contractual or formal appointment procedure, the Court may appoint a sole arbitrator to avoid delay.

It further recognised that questions concerning arbitrability, jurisdiction and the merits of the parties’ competing claims may be raised before and determined by the arbitral tribunal.

The Court found that the disputes concerning the trademark assignment, machinery sale, payment obligations, bank NOC and termination arose from a series of commercially interconnected agreements and were capable of being referred to arbitration.

Since both parties consented to arbitration and waived the prescribed appointment procedure, the Court considered that commencement of arbitration should not be delayed and appointed Justice S. Ravindra Bhat, former Judge of the Supreme Court of India, as the sole arbitrator.

The Court preserved the tribunal’s jurisdiction to decide all objections, including arbitrability and jurisdiction, and clarified that its observations were only prima facie and would not influence the arbitral determination on merits.

Since the Section 9 proceedings concerned interim protection and the arbitral tribunal was being constituted, the Court directed that the petitions be treated as applications under Section 17 for consideration by the learned arbitrator.

Pending that consideration, the Court adopted limited protective measures without expressing any view on title or validity of the trademark assignment.

The arbitrator was directed to enter upon the reference within two weeks and furnish the requisite disclosure under Section 12(2) of the Act.

The Section 9 petitions were directed to be treated as applications under Section 17 and considered by the arbitral tribunal.

Pending consideration, neither party was permitted to assign, license, encumber or create third-party rights in the disputed trademarks; both parties were directed to preserve relevant business records, maintain separate and complete sales accounts, and refrain from altering the existing proprietary position of the marks through further assignment or transfer.

The petitions and pending applications were accordingly disposed of.