Sanghi Industries Limited vs Ravin Cables Ltd., and Anr.

Court

Supreme Court of India

Date

30 September 2022

Case No.

Civil Appeal No. 6908 of 2022

Result

Allowed

Bench

M.R. Shah, Krishna Murari

Citation

[2022] 4 S.C.R. 850 : 2022 INSC 1050

Headnote

Arbitration and Conciliation Act, 1996 – s.9 – Code of Civil Procedure, 1908 – Or.XXXVIII, r.5 – Application u/s.9 – Power of Commercial Court – Appellant invoked performance bank guarantees issued by respondent no.1 – Thereafter, it invoked arbitration – Respondent No.1 filed application u/s.9 before Commercial Court regarding the bank guarantees, pending which the bank realized the payments under the bank guarantees invoked by the appellant – Commercial Court passed order u/s.9(ii)(e) to secure the amount in dispute and directed the appellant to deposit the amount of bank guarantees – Order confirmed by High Court – Held: Bank guarantees were already invoked and the amounts thereunder were already paid by the bank much prior to the Commercial Court passed the order u/s.9 – Unless and until the pre-conditions u/Or.XXXVIII, r.5, CPC were satisfied and unless there were specific allegations with cogent material and prima-facie the Court was satisfied that the appellant was likely to defeat the decree/award that may be passed by the arbitrator by disposing of the properties and/or in any other manner, the Commercial Court could not have passed such an order in exercise of powers u/s.9 – Order passed by the Commercial Court in an application u/s.9 is mainly by way of interim measure – In a given case if all the conditions of Or.XXXVIII, r.5, CPC are satisfied and the Commercial Court is satisfied as aforesaid, it may pass an appropriate order including the restrain order and/or any other appropriate order to secure the interest of the parties – Further, in the present case even otherwise there are serious disputes on the amount claimed by the parties – Impugned order passed by the High Court and the order of the Commercial Court, set aside – Commercial Courts Act, 2015.

The Judgment of the Court was delivered by M. R. SHAH, J. 1. Feeling aggrieved and dissatisfied with the impugned judgment and order dated 11.02.2022 passed by the High Court of Gujarat at Ahmedabad in Regular First Appeal No. 3253 of 2021, by which, the High Court has dismissed the said appeal confirming the order passed by the Commercial Court in an application under Section 9 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as the Arbitration Act, 1996), by which the Commercial Court directed the appellant herein – original opponent/respondent No. 1 to deposit the am

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