SVERDRUP CIVIL INC Vs. GOVERNMENT OF A P

JUDGEMENT

(1.) This civil miscellaneous appeal is directed against the order of 30th June, 2001 passed in O.P. No. 1100/2001 and I.A.NO. 1724/2001 therein on the file of the Court of the II Additional Chief Judge, City Civil Court, Hyderabad. By the said order, the plea of the appellant- company for grant of injunction against the respondents and their men was negatived. The said plea was made invoking Section 9 of Arbitration and Conciliation Act, 1996 for grant of injunction as an interim measure, pending arbitration proceedings. Section 9 of the Arbitration and Conciliation Act, 1996 reads thus : "9. Interim measures etc., by Court :A party may, before or during arbitral proceedings or at any time after the making of the arbitral award but before it is enforced in accordance with Section 36, apply to a Court (i) for the appointment of guardian for a minor or a person of unsound mind for the purposes of arbitral proceedings; or (ii) for an interim measure of protection in respect of any of the following matters, namely, (a) the preservation, interim custody or sale of any goods which are the subject-matter of the arbitration agreement; (b) securing the amount in dispute in the arbitration; (c) the detention, preservation or inspection of any property or thing which is the subject-matter of the dispute in arbitration, or as to which any question may arise therein and authorizing for any of the aforesaid purposes any person to enter upon any land or building in the possession of any party, or authorising any samples to be taken or any observation to be made, or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full information or evidence; (d) interim injunction or the appointment of a receiver; (e) such other interim measure of protection as may appear to the Court to be just and convenient; and the Court shall have the same power for making orders as it has for the purpose of, and in relation to, any proceedings before it." We need not elaborate on the judicial precedents regarding the exercise of the power under the said Act. The Court, for the reasons enumerated in the above Section, can always grant interim orders before invoking arbitration, after invoking arbitration and pending the arbitration proceedings and even after passing of the award by the arbitrators, but before its enforcement. In the instant case, the Court was empowered to adjudicate as to whether a case is made out for invocation of Section 9 of the Act or not.

(2.) Some relevant facts need to be stated for considering the correctness or otherwise of the order of the Court-below. On 28-6-2000, the appellant-company and the 2nd respondent had entered into an agreement, by which, the appellant-company had to provide certain consultancy services in respect of Phase-III of widening and strengthening of certain Highways in Andhra Pradesh. As per clause 1.9 of the contract, the authorized representatives on behalf of the appellant-company were Mr. Suresh Malik and the Project Director of the office of Engineer-in-Chief, the 3rd respondent herein. Disputes arose between the parties regarding deployment of key-personnel for rendering the consultancy services by the appellant-company to the 2nd respondent, which ultimately resulted in the termination of contract dated 28-6-2000 by the 2nd respondent. Invoking the arbitration clause contained in the said agreement, the appellant company by its letter dated: 18-5-2001 addressed to the 2nd respondent appointed an arbitrator on its behalf and called upon the 2nd respondent to respond and on the ground that there was no response from the 2nd respondent, the appellant-company had filed Writ Petition No. 10641/2001 in this Court, but withdrew the same and again filed another Writ Petition No.11934/2001, which was dismissed on merits by order dated 20-6-2001. It is pertinent to mention that LA. No. 1724/2001 has been filed for interim injunction pending disposal of the main O.P. But, since the prayers in LA. and O.P. are the same, LA. was called along with the O.P. and O.P. itself was heard and disposed of rejecting the plea of appellant- company. Hence, this Appeal.

(3.) Mr. B.Adinarayana Rao, the learned Counsel for the appellant-company strenuously contends that the lower Court has misdirected itself by not exercising the power under Section 9 of the Act and that the facts and circumstances warranted the grant of injunction order as an interim measure pending the arbitral proceedings. Mr.D.Praksh Reddy, the learned Additional Advocate-General, appearing for the respondents and countering the arguments advanced on behalf of the appellapt- company, supports the order of the lower Court stating that relevant factors, both, factual and legal, were taken into consideration by the lower Court and that the plea of grant of injunction was correctly rejected and that the impugned order does not call for any interference by this Court.