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IN THE HIGH COURT OF JUDICATURE AT BOMBAY

ORDINARY ORIGINAL CIVIL JURISDICTION

COMMERCIAL ARBITRATION PETITION NO.983 OF 2025

Ningbo Aux Imp & Exp Co. Ltd. .... Petitioner

V/S

1 Amstrad Consumer India Pvt. Ltd.

(formerly known as OVOT Pvt. Ltd.)

2 Vijay Sales (India) Pvt. Ltd. .... Respondents

_________

Ms. Kshama Loya with Ms. Sankriti Sharma i/b M/s. Link Legal for

the Petitioner.

Mr. Karl Tamboly with Mr. Reehan Ajmerwala, Ms. Eshika Chandan

& Mr. Siddharth Punj i/b M/s. Lodha & Lodha Advocates

for

Respondents.

__________

CORAM : SANDEEP V. MARNE, J.

RESERVED ON : 14 JANUARY 2026.

PRONOUNCED ON : 28 JANUARY 2026.

J U D G M E N T:

1. This is a post-foreign award Petition filed under Section 9 read

with Section 2(2) of the Arbitration and Conciliation Act, 1996

(Arbitration Act) seeking interim measures for securing the awarded

sum from Respondents during pendency of enforcement proceedings

filed by the Petitioner under Sections 47 and 49 of the Arbitration Act.

The Petition involves the issue of permissibility to make interim

measures under Section 9 of the Act against a third party, who is

deleted from enforcement proceedings filed by the award creditor

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under Sections 48 and 49 of the Act and against whom the award is no

longer enforceable.

FACTS

2.Petitioner- Ningbo Aux Imp & Exp Co. Ltd. (Ningbo) is a

company incorporated under the laws of People’s Republic of China

and is engaged in the business of providing international trading

services, particularly export of air-conditioners and related spare parts

and products. The first Respondent Amstrad Consumer India Private

Limited (Amstrad) was formerly known as OVOT Private Limited

(Ovot), which is engaged in manufacture of electric motors, generators,

transformers and sale of home appliances. Petitioner entered into an

agreement with Amstrad/Ovot, under which Respondent No.1 agreed

to purchase AC units from the Petitioner. The Purchase Order dated 23

October 2020 placed by Amstrad upon Petitioner contained an

arbitration clause. Petitioner supplied AC units to Amstrad.

Respondent No.2- Vijay Sales (India) Private Limited (Vijay Sales)

apparently had links with Amstrad since promoters and directors of

Vijay Sales held key managerial positions in Amstrad. According to

Petitioner, Vijay Sales had executed guarantee certificate on 28

February 2020 guaranteeing that it would be responsible for all

payments to be made by Amstrad/Ovot to Ningbo for orders upto

USD 10 million and that if Amstrad/Ovot made any payment default,

Vijay Sales would be responsible to pay to Ningbo. The guarantee

certificate was valid from 1 March 2020 to 31 August 2021. It is

Petitioner’s contention that the sale transaction for AC units was

entered into by Ningbo with Amstrad/Ovot on the strength of

guarantee issued by Vijay Sales.

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3.Disputes arose between Ningbo and Amstrad/Ovot in respect of

payment of proforma invoices issued between 8 February 2021 to 12

February 2021. Ningbo therefore wrote to Vijay Sales on 24 April 2021

to fulfil its guarantee and make payment on behalf of Amstrad/Ovot.

Vijay Sales responded stating that all dues payable to Amstrad/Ovot

were fully paid.

4.Petitioner-Ningbo initiated arbitration proceedings on 26

September 2021 under the aegis of Shanghai International Arbitration

Centre (SHIAC) against both Amstrad/Ovot and Vijay Sales. It is

Petitioner’s case that the Case Manager at SHIAC verbally instructed

the Petitioner-Ningbo to refile the Arbitration Application by deleting

name of Vijay Sales citing that Vijay Sales was not a party to the

Proforma Invoices. Petitioner accordingly refiled the Arbitration

Application only against Amstrad/Ovot. The SHIAC Arbitral Tribunal

made Arbitral Award dated 30 November 2023 directin g

Amstrad/Ovot to pay to Ningbo USD 1,448,940.91 towa rds

outstanding dues and RMB 180,533.38 towards refund of arbitration

fees.

5.Since Respondents failed to pay the awarded amounts to the

Petitioner, enforcement proceedings under Sections 47 and 49 of the

Arbitration Act being Commercial Arbitration Petition (L) No.29646

of 2024 was filed by the Petitioner against both the Respondents in this

Court. On 12 March 2025, this Court passed

ex parte order directing

Respondents to disclose their assets. The order was confirmed on 3

April 2025 rejecting Respondents’ contentions. Vijay Sales filed

application for deletion of its name from the enforcement petition and

also prayed for vacation of disclosure order. By order dated 4 July

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2025, this Court allowed both the applications of Vijay Sales and

directed its deletion from enforcement proceedings. This Court also

vacated disclosure order

qua Vijay Sales. In the meantime, Amstrad

filed disclosure affidavit dated 21 April 2025. Petitioner sought an

order for deposit of awarded amount by Amstrad. The enforcement

proceedings against Amstrad are still pending.

6.In light of above background, Petitioner has filed present

Petition under Section 9 read with Section 2(2) of the Arbitration Act

seeking following prayers:

a. Pass an order directing the Respondents to jointly and severally deposit

with this Hon'ble Court the full Awarded Amount of USD 1,448,940.91

and RMB 180,533.38;

b. Pass an order directing Respondent No. I to disclose on Affidavit full

particulars of all their assets-movable and immovable, tangible and

intangible-including all bank accounts, deposits, receivables, inventories,

and financial investments, along with complete financial statements, trial

balances, cash flow statements, ledgers, auditor reports and tax filings for

Financial Years 2023-24 and 2024-25, as well as all transactions undertaken

from 30 September 2024 till the date of the order of this Hon'ble Court in

this Petition;

c. Pass an order of injunction against Respondent No. 1 restraining it from

alienating, transferring or dealing with its assets in any manner, including

injunction against operating or withdrawing any amount from its bank

accounts, and to restrain any third-party transfers or encumbrances pending

disposal of the Enforcement Petition before this Hon'ble Court;

d. Pass an order directing Respondent No. 2 to disclose on Affidavit full

particulars of all its assets-movable and immovable, tangible and intangible

– including all bank accounts, deposits, financial documents, and

transactions undertaken from 30 November 2023 till the date of the order

of this Hon’ble Court in this Petition;

e. Pass an order of injunction against Respondent No. 2 restraining it from

alienating, transferring or dealing with its assets in any manner, including

injunction against operating or withdrawing any amount from its bank

accounts, and to restrain any third-party transfers or encumbrances pending

disposal of the Enforcement Petition before this Hon 'ble Court;

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f. Pass such further or other interim, ad-interim or consequential orders as

this Hon'ble Court may deem fit in the interests of justice.

SUBMISSIONS

7.Ms. Kshama Loya, the learned counsel appearing for Petitioner-

Ningbo submits that after a foreign award becomes enforceable, the

award creditor can execute the same against third parties by lifting the

corporate veil and by invoking the ‘group of companies’ doctrine. That

in the present case, Amstrad and Vijay Sales are closely interlinked as

they have common and overlapping key management personnel. That

the certificate of guarantee itself makes it clear that Vijay Sales is a

shareholder of Amstrad/Ovot. That Mr. Nanu Narotam Gupta and

Mr. Nilesh Nanu Gupta (father and son) are directors of Respondent

No.2-Vijay Sales, who simultaneously held key managerial positions

with Amstrad/Ovot. That Mr. Nanu Narotam Gupta served as

director and also held position of chairman of board of directors of

Amstrad until his resignation on 28 May 2024. That Mr. Nilesh Gupta

continued as the director of Amstrad until 28 September 2024. That as

on the date of his resignation, Mr. Nilesh Gupta was the largest

individual shareholder of Amstrad holding 23,75,000 equity shares of

Amstrad. That Vijay Sales itself is a shareholder of Amstrad. She

therefore submits that the corporate veil needs to be lifted and group of

companies doctrine needs to be applied for making interim measures

against Vijay Sales for enforcement of the foreign award.

8.Ms. Loya further submits that Section 9 read with Section 2(2) of

the Arbitration Act and the closing statement of Section 9(1) of the

Arbitration Act permits parties to seek post-award interim reliefs

against third parties. That Section 9 jurisdiction can also be exercised

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after an award is passed, but before it is enforced in accordance with

Section 36 of the Arbitration Act. That in the context of a foreign

award, the same becomes enforceable under Section 49 of the

Arbitration Act after disposal of objections under

Section 48. That therefore, the remedy under Section 9 of the

Arbitration Act is available to the Petitioner irrespective of whether the

Petition is filed before, during or after passing of the award. That

power under Section 9 of the Arbitration Act can be exercised against

third parties to preserve the ‘amount in dispute’, which is distinct from

language of Section 47 of the Arbitration Act which relates to ‘subject

matter of the award’. That therefore Section 9 remedy can be exercised

against parties who bear a nexus with the dispute and from whom the

security can be obtained to secure the amount in the dispute.

Therefore, the nexus of third party to ‘amount in dispute’ is the

determinative factor.

9.Ms. Loya relies on judgment of the Delhi High Court in

Eveready Industries India Ltd. vs KKR India Financial Services

Limited and Another

1

in support of her contention that Section 9 of

the Arbitration Act can be extended to third parties, who, in the case

before Delhi High Court, were merely referred to as ‘reference entities’

forming part of single economic unit. She also relies on judgment of

the Delhi High Court in Gatx India Pvt Ltd. vs Arshiya Rail

Infrastructure Limited & Anr.

2

in support of her contention that

Section 9 remedy can be extended to a third-party guarantor once it is

found that there is group involvement. She also relies on judgment of

Delhi High Court in VLS Finance Limited vs. BMS IT Institute

1 2022 SCC OnLine Del 395

2 2014 SCC OnLine Del 4181

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Private Limited and Anr.

3

and of this Court in Valentine Maritime

Limited and Ors. vs Kreuz Subsea Pte Limited and Ors.

4

10.Ms. Loya would further submit that Amstrad/Ovot and Vijay

Sales are inextricably interlinked and Vijay Sales bears a strong nexus

to the amount in dispute. That Vijay Sales has given a blanket

guarantee for all future orders and the transaction was entered into

during validity of the guarantee. That the guarantee was signed by

Mr. Nilesh Gupta who held common and overlapping ke y

management positions in both Group Companies. That Vijay Sales

had responded to the Petitioner in respect of liability of Ovot making it

abundantly clear that there is direct nexus between Vijay Sales and the

amount in dispute.

11.Ms. Loya would further submit that the guarantee certificate and

proforma invoice is a composite transaction. That intention of

connected parties is essentially to determine whether a transaction is

intended to be composite. She relies on judgment of the Apex Court in

Chloro Controls (I) Pvt. Limited vs. Severn Trent Water Purification

Inc. & Ors.

5

in support of her contention that there is implied consent

of guarantors to a transaction. She submits that conduct of Vijay Sales

would bind it to agreement between Petitioner-Ningbo and

Amstrad/Ovot. That the guarantee certificate is a commercial act to

induce and secure Petitioner-Ningbo’s entry into the transaction. That

therefore conduct of Vijay Sales shows that it was an active participant

in formation of the contract and secured its performance. That Vijay

Sales has a direct stake in performance of proforma invoice due to its

3 2015 SCC OnLine Del 9292

4 2021 SCC Online Bom 2294

5 (2013) 1 SCC 641

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shareholders status. She would further submit that by virtue of

common directorship, Vijay Sales had full knowledge of the

contractual structure.

12.Ms. Loya would further submit that Amstrad does not have

financial condition or capacity to fulfill the Award and has been

engaging in actions that would seriously obstruct the enforcement

thereof. That there have been material changes in the structure of

Amstrad as well as control and management since September 2024.

That time and scale of the material changes and resignation are highly

unusual and stare in the face of potential enforcement actions and

liabilities arising against Amstrad from the Award.

13.Ms. Loya would further submit that liability of a guarantor is

coextensive with that of principal debtor. That since guarantor is

inexplicably linked to the award-debtor and the agreement, the

financial position, asset base and intercompany dealings of Vijay Sales

become relevant for securing the award. Ms. Loya would submit that

Petitioner has a strong

prima facie case and would suffer imminent and

irreparable harm unless urgent interim measures are granted on

account of precarious financial position of Amstrad and a serious

apprehension of asset dissipation to obstruct and delay enforcement of

the Award. That Respondents have engaged themselves in collusive

actions since September 2024 aimed at obstructing the enforcement.

That balance of convenience is overall mainly in Petitioner’s favour.

On the above broad submissions, Ms. Loya would pray for making the

Petition absolute in terms of the prayers therein.

14.Mr. Tamboly, the learned counsel appearing for the Respondents

submits that Vijay Sales was not a party to arbitration proceedings and

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that therefore no foreign award has been passed against it. That

Petitioner had sought to make Vijay Sales a party to arbitration

proceedings but was not successful in doing so. That even though Vijay

Sales is not a party to arbitration proceedings, the Petitioner still

attempted to rope in Vijay Sales in Commercial Arbitration Petition

(L) No.29646 of 2024 filed under Sections 48 and 49 of the Arbitration

Act. That by order dated 4 July 2025, this Court has directed deletion

of Vijay Sales from the said Arbitration Petition. Thus, the foreign

award cannot be enforced against Vijay Sales, and since there is no

possibility of enforcement of the award against Vijay Sales, no interim

measures under Section 9 of the Arbitration Act can be directed

against Vijay Sales.

15.Mr. Tamboly further submits that if the Award itself is not

enforceable against Vijay Sales, no interim relief can be granted.

Relying on judgment of this Court in Aircon Belbars FZE vs Heligo

Charters Pvt. Ltd.

6

he submits that if the foreign award does not result

in an enforceable decree, then the protective order under Section 9 of

the Arbitration Act cannot continue. Relying on proviso to Section 2(2)

of the Arbitration Act, he submits that the Award needs to be

enforceable and recognizable under provisions of Part II of the

Arbitration Act and that therefore as a matter of propriety, the Award

can only be enforced and recognized against Respondent No.1. That

though Section 9 proceedings can be filed against third party, such

measure needs to be adopted only in recognized circumstances where a

third party claims through or under a party to arbitration agreement.

He relies on judgment of Kerala High Court in Shoney Sanil vs.

Coastal Foundations (P) Ltd. & Ors.

7

as followed by Division Bench of

6 2017 SCC OnLine Bom 631

7 AIR 2006 Ker 206

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this Court in Girish Mulchand Mehta and another vs. Mahesh S.

Mehta and another

8

. He also relies on judgment of Delhi High Court

in M/s. Value Advisory Services vs. M/s. ZTE Corporation and

Others

9

in support of his contention that the Court is not bound to

grant interim protection when liability is denied by the third party and

disputed questions of fact arise, which cannot be adjudicated without

conducting trial.

16.Mr. Tamboly further submits that Vijay Sales does not fall within

the scope of ‘claiming through’ or ‘under’ which is the requisite

condition under Section 9 of the Arbitration Act. That the guarantee

constituted separate and independent agreement between Petitioner

and Vijay Sales. That Petitioner had called upon Vijay Sales to repay

the amount under the guarantee which has been outrightly refused by

Vijay Sales. That liability of guarantor is always co-extensive with

principal borrower. That creditor may opt to sue the principal borrower

without suing the guarantor or only the guarantor and not the principal

borrower or both. That therefore Vijay Sales could have been sued

concurrently alongwith Amstrad. However, Petitioner chose to bring

action only against Amstrad. That having omitted to sue Vijay Sales in

the arbitration proceedings, Petitioner cannot now seek to enforce

award against Vijay Sales.

17.Mr. Tamboly further submits that the award in the present case is

a money decree and no case is made out by the Petitioner to

demonstrate as to how grant of any interim relief against Vijay Sales

can ever reserve/protect subject matter of the dispute. That present

Petition is nothing but a case of forum shopping where a party who is

8 2009 SCC OnLine Bom 1986

9 2009 SCC OnLine Del 1961

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unable to procure relief from one Court has approached another Court

for same relief. That the present Petition is filed after realizing that

Award cannot be enforced against Vijay Sales on account of deletion

of Vijay Sales from the enforcement proceedings.

18.Mr. Tamboly would further submit that Petitioner has already

sought necessary reliefs, both substantive as well as interim, against

Amstrad in enforcement proceedings and that therefore the same

cannot be considered in the present Petition without prejudice to its

claims. That Amstrad has positive net worth and asset base of

approximately Rs.52 Crores. That Amstrad has successfully repaid

working capital facility aggregating to Rs.120 Crores to its lender

banks. That there is nothing on record to indicate that Respondent

No.1 is attempting to fritter away its assets for defeating the claim of

the Petitioner. That therefore no order can be passed even against

Amstrad in the present Petition.

19.Lastly, Mr. Tamboly would submit that direction for deposit

cannot be routinely granted merely because a monetary claim is

awarded by the Arbitral Tribunal. In support, he relies upon the

judgment of Delhi High Court in National Highways Authority of

India vs IRB Ahmedabad Vadodara Super Express Tollways Pv.t Ltd.

10

Mr. Tamboly would pray for dismissal of the Petition.

REASONS AND ANALYSIS

20. The disputes between the parties emanate out of a Proforma

Invoice issued by Petitioner-Ningbo to Amstrad/Ovot on 23 October

2020 for purchase of 22,213 AC units from the Petitioner for sum of

10 2024 SCC OnLine Del 7285

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USD 27,38,634. The Proforma Invoice contained arbitration

agreement. Vijay Sales is not concerned with the Proforma Invoice but

had issued a Guarantee Certificate on 28 February 2020 in favour of

the Petitioner guaranteeing the payment on behalf of Amstrad/Ovot

for future orders upto USD 10 million. There is no dispute to the

position that the Certificate of Guarantee did not contain arbitration

agreement.

21.The case involves a rather peculiar circumstance. Petitioner

alleges non-payment of amounts payable under the Proforma Invoice

by Amstrad/Ovot. It is claimed by Amstrad/Ovot that when it

intended to make payment against the Proforma Invoice, it received an

email from representative of Petitioner containing bank details for

transmission of invoice amount. It is Amstrad’s case that the entire

invoice amount has been paid by it into the communicated bank

account. It appears that said account has turned out to be a fraudulent

one and Petitioner claims that it has not received any amount towards

the Proforma Invoice. Thus the monies allegedly paid by Amstrad have

gone into account of a fraudster. Since Petitioner has not received the

amount, it invoked arbitration clause 8 of Proforma Invoice, which

culminated into arbitration proceedings before SHIAC.

22.Initially, Petitioner initiated arbitration proceedings against both

Amstrad/Ovot as well as Vijay Sales. Petitioner, however, claims that

the Case Manager at SHIAC verbally directed it to delete Vijay Sales

from arbitration proceedings on account of Vijay Sales not being party

to Proforma Invoice. Petitioner accordingly proceeded to delete Vijay

Sales from arbitration proceedings and filed a revised arbitration

application only against Amstrad/Ovot. This is how arbitration

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proceedings are conducted only between Petitioner a nd

Amstrad/Ovot, and Vijay Sales is admittedly not a party to the

arbitration proceedings and to the Award. The SHIAC arbitral award

dated 30 November 2023 has awarded sum of USD 14,48,940.91

towards outstanding dues and RMB 1,80,533.38 towards arbitration

fees in favour of the Petitioner.

23.Though Vijay Sales was not a party to arbitration proceedings or

to the foreign Award, Petitioner has still proceeded to implead Vijay

Sales as Respondent No.2 in Commercial Arbitration Petition (L) No.

29646 of 2024 filed under Sections 48 and 49 of the Arbitration Act for

enforcement of SHIAC Award. Vijay Sales opposed its impleadment

in the enforcement proceedings and applied for its deletion. By order

dated 4 July 2025, this Court has directed deletion of Vijay Sales from

the enforcement proceedings. It would be apposite to refer to the

findings recorded by this Court in order dated 4 July 2025. This Court

held in paragraphs 7 to 14, 17 and 18 as under:

7. Likewise, under Section 48(1)(b) of the Act, the enforcement of a foreign

award may be refused at the request of a party against whom it is invoked

only if that party furnishes to the Court proof that the party against whom

the award is invoked was not given proper notice of the appointment of the

arbitrator or of the arbitral proceedings or was otherwise unable to present

his case. In the instant case, Respondent No. 2 was not even a party to the

arbitral proceedings, much less a party to the proceedings who was entitled to

notice of the appointment of the arbitrator or was unable to present his case.

8. Therefore, on the last occasion, notice was issued on the Interim

Applications. Thereafter, the original Petitioner has filed an affidavit, which

essentially brings on record the fact that the Petitioner had initially tried to

make Respondent No.2 a party to the proceedings and the case manager of the

arbitral tribunal had refused to permit Respondent No.2 being made a party.

Therefore, what is evident is that Respondent No.2 is not a person against

whom the arbitral award is made. However, enforcement is sought to be made

against Respondent No.2 as well. This position in fact ought to have been made

clear up front by the Petitioner in its pleadings in the Petition and more so when

the matter was first considered on an ex parte basis.

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9. It is true that Respondent No. 2 has been sought to be roped in, in its capacity

as a guarantor for the transactions between the Petitioner and Respondent No.1.

Towards this end, reliance is placed by Learned Counsel for the Petitioner on

the “guarantee certificate” executed by Respondent No.2 (Exhibit ‘C’ to the

Petition at Page 103). The guarantee certificate states that Respondent No.2 is a

shareholder of Respondent No.1 and that Respondent No.2 formally guarantees

that Respondent No.2 would be responsible for all the payments to be made by

Respondent No.1 to the Petitioner in respect of future orders up to a level of US

$ 10 million if Respondent No.1 were to make a payment default. The

guarantee certificate does not have an arbitration clause. It also does not have

any incorporation of an arbitration agreement by reference to the arbitration

clause contained in the agreement between the Petitioner and Respondent No.1.

10. In these circumstances, the failed attempt to make Respondent No.2 a party

to the arbitral proceedings, as is seen from the Petitioner’s affidavit, gains

significance. Admittedly, an attempt had been made by the Petitioner to make

Respondent No. 2 a party to the arbitration proceedings and that was rejected

by the case manager of the arbitral tribunal. Learned Counsel for the Petitioner

would strenuously urge that rejection by a case manager of the attempt to make

Respondent No.2 a party should not be treated as a rejection by the arbitral

tribunal. I am unable to agree. The case manager is an officer of the arbitral

tribunal. If the case manager wrongly disallowed Respondent No.2 to be made

a respondent in the arbitration proceedings, the Petitioner ought to have taken

recourse to steps available in those proceedings to overrule the case manager. If

that had not been done, or if, despite being done, had not been accepted, the

consequence would be that the arbitral award sought to be enforced is not an

award made between the Petitioner and Respondent No. 2.

11. It is evident that Respondent No.2 is not a party against whom the award

sought to be enforced has been made. In these circumstances, the position of

Respondent No.2 stands even higher than the position available under Section

48(1)(b) – not only is it a case where Respondent No.2 cannot be said to be a

party who was unable to participate in the proceedings, Respondent No.2 is a

person who was sought to be made a party and the very arbitral tribunal whose

arbitral award is sought to be enforced, had not permitted making Respondent

No.2 a party.

12. In these circumstances, no fruitful purpose would be served in keeping

Respondent No.2 as a party. If the foundational jurisdictional fact of the arbitral

award being an award made as between the Petitioner and Respondent No. 2 is

absent, the order dated March 12, 2025 would be one that was passed without

jurisdiction.

13. In this context, the pleadings in the Petition containing the description of

facts in respect of Respondent No.2 are noteworthy. Paragraph 8 in the Petition

inter alia describes Respondent No.2 as a shareholder of Respondent No.1. It is

explicitly stated that Respondent No.2 has been made a party to the present

Petition solely for the prayers sought under paragraph 36 of the Petition. There

is no specific role played by Respondent No. 2 that was adjudicated in the

arbitral proceedings.

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14. The prayer sought in Paragraph 36 of the Petition not only seeks disclosures

by Respondent No. 2 but also seeks the appointment of a Court Receiver to

attach the assets and properties of both Respondents. Therefore, the disclosure

sought in Paragraph 36(b) from both Respondents is in aid of the prayer in

Paragraph 36(d), which seeks appointment of the Court Receiver to the extent

of US $ 1.45 million with all powers under Order 40 Rule 1 of Code of Civil

Procedure, 1908 (“CPC”) in respect of properties of both Respondents. If

Respondent No.2 is not a party against whom the arbitral award has been made,

it would follow that there would be no possibility to enforce the award against

Respondent No.2. Consequently, forcing Respondent No.2 to make a disclosure

without such disclosures being in aid of a maintainable prayer , would be

inappropriate. Therefore, the request by Learned Counsel for the Petitioner to

not vacate the direction to disclose at the least, does not appeal to me.

x x x

17. This Court is administering the provisions of Part II which sets out the

jurisdiction of this Court. If the Court does not have jurisdiction by the reading

of Section 46 and Section 48 (analysed above) to enforce the arbitral award

against Respondent No. 2 since he is not a person against whom the award is

made, it would follow that the power to recall ought to be exercised.

18. In these circumstances, in my opinion, it would be inappropriate to

continue to keep Respondent No.2 as a party to these proceedings. I have

no hesitation in allowing both the Interim Applications. The order directing

disclosures by Respondent No.2 (who was rejected as a proposed party in

the arbitral proceedings) stands vacated. The Petitioner shall carry out the

deletion of Respondent No.2 within four weeks of the upload of this order

on the website of this Court.

24.It appears that the Petitioner has not challenged the order dated

4 July 2025 directing deletion of Vijay Sales from enforcement

proceedings and the order has attained finality. On account of deletion

of Vijay Sales from enforcement proceedings, the foreign award cannot

be enforced against Vijay Sales. In the light of this position, the issue

that arises for consideration is whether this Court can make any

interim measures against Vijay Sales during pendency of the

enforcement proceeding.

25.The present Petition is filed by the Petitioner under Section 9

read with Section 2(2) of the Arbitration Act seeking interim measures

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pending hearing and final disposal of Petitioner’s enforcement

proceedings. Since the Award itself cannot be enforced against Vijay

Sales, it becomes questionable as to how this Court can make an order

under Section 9 against Vijay Sales. It would be apposite to refer to the

provisions of Section 9 of the Arbitration Act which provides thus:

9. Interim measures, etc., by Court.

(1) 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 a guardian for a minor or 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 subjectmatter of the dispute in arbitration, or

as to which any question may arise therein and authorising 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.

(2) Where, before the commencement of the arbitral proceedings, a Court

passes an order for any interim measure of protection under sub-section (1), the

arbitral proceedings shall be commenced within a period of ninety days from

the date of such order or within such further time as the Court may determine.

(3) Once the arbitral tribunal has been constituted, the Court shall not

entertain an application under sub-section (1), unless the Court finds that

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circumstances exist which may not render the remedy provided under

section 17 efficacious.

26. So far as foreign award is concerned, Proviso to sub-section (2)

of Section 2 makes provisions of Section 9 of the Arbitration Act

applicable to international commercial arbitration even if place of

arbitration is outside India and when arbitral award is enforceable in

India. Section 2(2) of the Arbitration Act and proviso thereto read

thus:

(2) This Part shall apply where the place of arbitration is in India:

Provided that subject to an agreement to the contrary, the provisions of sections

9, 27 and clause (a) of sub-section (1) and sub-section (3) of section 37 shall

also apply to international commercial arbitration, even if the place of

arbitration is outside India, and an arbitral award made or to be made in such

place is enforceable and recognised under the provisions of Part II of this Act.

27.Though Mr. Tamboly did seek to suggest during the course of

his oral submissions that the present Petition under Section 9 of the

Arbitration Act is not maintainable, the issue is no more

res integra

and is covered by Division Bench judgment of this Court in

Heligo

Charters Private Limited vs. Aircon Belbars FZE

11

in which it is held

that post-award Petition under Section 9 of the Arbitration Act is

maintainable even in respect of international commercial arbitration.

In Heligo Charters Private Limited it is held in paragraphs 15, 16, 17

as under:

15. Heard learned Counsel appearing for the respective parties. We agree

with the submissions advanced by the Counsel appearing for the

respondents. The amended provisions of Section 2(2) clearly stipulates that

subject to an agreement to the contrary, the provisions of Section 9 shall

apply to international commercial arbitration even if the place of

arbitration is outside India. The contention that unless the award is put to

execution in accordance with provisions of Section 48, a party is not

entitled to seek interim-relief is not sustainable. There is no such embargo

11 2018 SCC OnLine Bom 1388

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or restriction placed for seeking recourse to interim measures even if the

award is foreign-seated one. The amendment was brought into effect after

the Law Commission submitted its report consequent to judgment in the

case of BALCO (cited supra). Paragraph 194 of the judgment reads as

under:

“194. In view of the above discussion, we are of the considered

opinion that the Arbitration Act, 1996 has accepted the territoriality

principle which has been adopted in the UNCITRAL Model Law,

Section 2(2) makes a declaration that Part I of the Arbitration Act,

1996 shall apply to all arbitrations which take place within India. We

are of the considered opinion that Part I of the Arbitration Act, 1996

would have no application to international commercial arbitration

held outside India. Therefore, such awards would only be subject to

the jurisdiction of the Indian courts when the same are sought to be

enforced in India in accordance with the provisions contained in

Part II of the Arbitration Act, 1996. In our opinion, the provisions

contained in the Arbitration Act, 1996 make it crystal clear that

there can be no overlapping or intermingling of the provisions

contained in Part I with the provisions contained in Part II of the

Arbitration Act, 1996.”

16. We are, therefore, not inclined to accept the contentions of the appellant

on that ground. In view of the amended provisions and facts, we are of the

view that operation of provisions of Section 9 cannot be excluded in

absence of a specific agreement to the contrary. The judgment in BALCO

was pronounced on 6th September, 2012. The dispute between the parties

was referred on 8th April, 2015. The Arbitration agreement was executed

between the parties on 9th September, 2014. Whereas the Act was amended

on 23rd October, 2015.

17. In respect of interpretation placed by the Counsel appearing for the

appellant under the provisions of Section 2(2), 9 and 48, we are of the view

that the interim protection in the facts cannot be denied to the respondent

irrespective of as to whether the award was put to execution or not? Such a

measure is made available in law under Section 9 of the Act so as to prevent

dissipation and diversion of assets. This being the object and purpose

behind the amended provisions which is based on the recommendations of

the Law Commission. We do not find any error in the view adopted by the

learned Single Judge on this count. The judgments cited supra by the

Counsel appearing for the appellant do not support and sustain the

interpretation placed by the Counsel.

(emphasis added)

28.In

Shanghai Electric Group Co. Ltd. Vs. Reliance Infrastructure

Ltd.

12

, referring to the judgment in Ashwini Minda vs. U-Shin

12 2022 SCC OnLine Del 2112

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Limited

13

, learned Single Judge of Delhi High Court has interpreted

proviso to Section 2(2) of the Arbitration Act and has held that

applicability of Section 9 of the Arbitration Act is not excluded in

respect of foreign-seated institutional arbitration. In Ashwini Minda, it

is held that applicability of Section 9 of the Arbitration Act to a

foreign-seated arbitration is not excluded automatically and requires

agreement to the contrary by the parties. Therefore, the objection of

maintainability of the Petition need not detain the court any further.

29.Moving further, the interim measures by a Court under Section 9

of the Arbitration Act can be made

inter alia for securing ‘amount in

dispute’ in the arbitration. The powers under Section 9 of the

Arbitration Act are wide enough as if the Court is making order for the

purpose of or in relation to any proceedings before it. By now, it is well

established position that Court in exercise of powers under Section 9

of Arbitration Act can make necessary interim measures even against

third parties to preserve the amount in dispute.

30.The issue here is whether interim measures under Section 9 of

the Arbitration Act can be made against Vijay Sales, which is a third

party to the foreign Award. To rope in Vijay Sales within the ambit of

Court’s power under Section 9 of the Arbitration Act, Ms. Loya has

invoked the doctrines of ‘lifting of corporate veil’ and ‘group of

companies’. She has relied upon Division Bench judgment of Delhi

High Court in

Eveready Industries India Ltd. (supra). The Delhi High

Court has decided appeal under Section 37 of the Arbitration Act

against order of learned Single Judge refusing to vacate

ex-parte

ad-interim

injunction order passed against the Appellants against

13 2020 SCC OnLine Del 1648

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whom Group of Companies doctrine was invoked. Since the

Appellants were described as ‘Reference Entities’ to the agreements in

question, the Appellants were restrained by the learned Single Judge

under Section 9 of the Arbitration Act from selling their assets. The

order of the learned Single Judge was challenged contending

inter alia

that Appellants did not have any privity of contract with the lenders

and had no legally binding obligation or liability for repayment of

credit facilities under the Facility Agreement. On the other hand, it

was contented on behalf of the Respondent therein that the Appellants

were inextricably and intrinsically connected to the Facility Agreement

by which lenders had extended loan facility to the borrowers. It was

contended that the credit facilities were granted after due verification

of credit worthiness of group of companies as a whole, including the

three Appellant companies. In the light of the above factual position,

the Delhi High Court referred to the judgment of the Apex Court in

Chloro Controls (supra) and held in paragraphs 8, 9, 13(e) and 15 as

under:

8. Based on this English principle, the Supreme Court introduced and applied

the doctrine in the Indian context in Chloro Controls India v. Sereven Trent

Water Purification, (2013) 1 SCC 641 In this case, the doctrine was applied

with reference to enforcement of a foreign award under section 45 of the Act.

The court held:

“103. Various legal basis may be applied to bind a non-signatory to an

arbitration agreement.

103.1 The first theory is that of implied consent, third party

beneficiaries, guarantors, assignment and other transfer mechanisms of

contractual rights. This theory relies on the discernible intentions of the

parties and, to a large extent, on good faith principle. They apply to

private as well as public legal entities.

103.2 The second theory includes the legal doctrines of agent-principal

relations, apparent authority, piercing of veil (also called the “alter

ego”), joint venture relations, succession and estoppel. They do not rely

on the parties' intention but rather on the force of the applicable law.”

9. The court recognized the nature of modern business transactions which are

carried out through multiple agreements creating intrinsically related

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transactions between the parties within a corporate group, and formulated the

test for determining the applicability of the doctrine as follows:

“71. Though the scope of an arbitration agreement is limited to the

parties who entered into it and those claiming under or through them,

the Courts under the English Law have, in certain cases, also applied the

“Group of Companies Doctrine”. This doctrine has developed in the

international context, whereby an arbitration agreement entered into by

a company, being one within a group of companies, can bind its non-

signatory affiliates or sister or parent concerns, if the circumstances

demonstrate that the mutual intention of all the parties was to bind both

the signatories and the non-signatory affiliates. This theory has been

applied in a number of arbitrations so as to justify a tribunal taking

jurisdiction over a party who is not a signatory to the contract containing

the arbitration agreement. [‘Russell on Arbitration’ (Twenty Third

Edition)].

72. This evolves the principle that a non-signatory party could be

subjected to arbitration provided these transactions were with group of

companies and there was a clear intention of the parties to bind both, the

signatory as well as the non-signatory parties. In other words, ‘intention

of the parties' is a very significant feature which must be established

before the scope of arbitration can be said to include the signatory as

well as the non-signatory parties.

73. A non-signatory or third party could be subjected to arbitration

without their prior consent, but this would only be in exceptional cases.

The Court will examine these exceptions from the touchstone of direct

relationship to the party signatory to the arbitration agreement, direct

commonality of the subject matter and the agreement between the

parties being a composite transaction. The transaction should be of a

composite nature where performance of mother agreement may not be

feasible without aid, execution and performance of the supplementary or

ancillary agreements, for achieving the common object and collectively

having bearing on the dispute. Besides all this, the Court would have to

examine whether a composite reference of such parties would serve the

ends of justice. Once this exercise is completed and the Court answers

the same in the affirmative, the reference of even non-signatory parties

would fall within the exception afore-discussed.

76. The Court will have to examine such pleas with greater caution and

by definite reference to the language of the contract and intention of the

parties. In the case of composite transactions and multiple agreements, it

may again be possible to invoke such principle in accepting the pleas of

non-signatory parties for reference to arbitration. Where the agreements

are consequential and in the nature of a follow-up to the principal or

mother agreement, the latter containing the arbitration agreement and

such agreements being so intrinsically inter-mingled or inter-dependent

that it is their composite performance which shall discharge the parties

of their respective mutual obligations and performances, this would be a

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sufficient indicator of intent of the parties to refer signatory as well as

non-signatory parties to arbitration. The principle of ‘composite

performance’ would have to be gathered from the conjoint reading of the

principal and supplementary agreements on the one hand and the

explicit intention of the parties and the attendant circumstances on the

other.”

13. Having discussed the relevant legal principle and the developments around

it, we now proceed to examine the FA and the correspondence put forth:

x x x

e) The position on record is that in September, 2017 when the facility

was extended by the respondents, Mr. Brij Mohan Khaitan was the

Chairman of the appellant MRIL. Mr. Aditya Khaitan - a defined

guarantor and son of Mr. Brij Mohan Khaitan, was the Vice Chairman

and Managing Director and Mr. Amritanshu Khaitan - the other defined

guarantor, who is also the nephew of Mr. Brij Mohan Khaitan, was the

other Director of MRIL. The position in 2019-2020 was that Mr. Aditya

Khaitan is the Chairman and Managing Director of MRIL and Mr.

Amritanshu Khaitan is a Director. Section 2(54) of the Companies Act

defines the expression “Managing Director”, and by virtue of being the

Managing Director, the incumbent is “entrusted with substantial powers

of the Management of the affairs of the Company”. The expression

“Promoter” is defined in Section 2(69) of the Companies Act to mean a

person, inter alia, “has control over the affairs of the Company, directly

or indirectly whether as a Shareholder, Director or otherwise; or” “in

accordance with whose advice, directions or instructions the Board of

Directors of the Company is accustomed to act:” As pointed out by Mr.

Kaul, the position is the same when it comes to the other 2 appellants,

namely EIIL and MBECL. In EIIL, in the year 2017-2018 Mr. Brij

Mohan Khaitan was the Chairman, Mr. Aditya Khaitan was the Vice

Chairman, non-executive and Mr. Amritanshu Khaitan was a Director.

In the year 2019-2020, Mr. Aditya Khaitan was the Chairman, and Mr.

Amritanshu Khaitan was the Managing Director. In the third appellant

namely, MBECL, in the year 2017-2018, Mr. Aditya Khaitan was the

Chairman, and Mr. Amritanshu Khaitan was the Director. In January,

2021, Mr. Aditya Khaitan was the Chairman of MBECL. Thus, the

submission of Mr. Kaul that the appellants were also a part of the

Promoter Group as defined in Clause 1.1.1(ooo), appears to be correct,

inasmuch, as, the appellants were and are controlled entities of the

guarantor(s).

x x x

15. We, therefore, reject the submission of the Appellants that the factors

for invoking the Group Companies Doctrine did not exist in the present

case. The Supreme Court has invoked the doctrine in different conditions

and in relation to different subject matters, which has been discussed above.

The invocation of the doctrine depends on the mutual intention of the

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parties to bind not only the parties to the agreement, but other entities as

well, which form part of the group as a common economic entity.

31.Thus, in Eveready Industries India Ltd. the Division Bench of

Delhi High Court upheld invocation of Group of Companies doctrine

on account of inextricable and intrinsic connection of the Appellants

therein with the Facility Agreement under which the credit facilities

were disbursed to the borrowers. In the present case however, though

the Petitioner has demonstrated linkage of Vijay Sales with the

transaction of Proforma Invoice, there is a distinguishing factor where

the Petitioner has failed to demonstrate before the enforcement court

that the award can be enforced against Vijay Sales by invoking Group

of Companies doctrine. The issue in the present case is however

slightly different. The issue for consideration is whether a party, who

fails to demonstrate before the enforcement court that the award can be

enforced against third party by invoking Group of Companies

doctrine, can have a second bite at the cherry before Section 9 Court.

32. Ms. Loya has also relied upon judgment of learned Single

Judge of Delhi High Court in Gatx India Pvt Ltd. (supra) in which the

guarantor had sought to distance himself from the Lease Agreement.

The learned Single Judge of Delhi High Court held in paragraphs 60,

64, 72 and 75 as under:

60. I now proceed to consider the submission of the respondents that respondent

No. 2 is not a party to the Lease Agreement and, therefore, not a party to the

Arbitration Agreement. The submission of the respondents is that respondent

No. 2 has consciously not signed the lease agreement and is a party only to the

guarantee. According to the respondents, this shows the intention of the parties

not to embroil respondent No. 2 in an arbitration with the petitioner in respect

of the disputes arising under the lease agreement and to relegate the petitioner

and respondent No. 2 to the ordinary Civil Courts in respect of disputes arising

under the guarantee. The submission is that the guarantee cannot be enforced

and, no interim relief in respect thereof can be sought, in arbitration

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proceedings which may be initiated by the petitioner only against respondent

No. 1 - i.e. the second party to the lease agreement.

64. Even if it were to be accepted that respondent No. 2 is not bound by the

Arbitration Agreement contained in the Lease Agreement, an analysis of the

law, as interpreted and applied in several decisions leads to the conclusion that

in the facts of this case there is sufficient justification to issue interim directions

in respect of respondent no. 2. I may examine the legal position as regards the

power of court under section 9 of the Act to issue interim orders against third

parties to arbitration.

72. Even assuming that respondent no. 2 is not a party to arbitration agreement,

it is not a total stranger to the covenants of the Lease Agreement. Apparently,

respondent no. 2 has been in the picture throughout : at the stage of execution

of the Lease Agreement between the lessor and the lessee, and also during the

subsistence of the Lease - when respondent no. 1 allegedly defaulted in

performance of its obligations thereunder. .....

75. Respondent no. 1 is a wholly owned subsidiary of respondent no. 2. It is not

uncommon that in cases where group companies substantially constitute one

economic entity, the courts - instead of going by the separate legal entities of

the companies, have lifted the corporate veil, and looked at the common

economic entity of the group to which they belong. In view of the facts of the

case, and the conduct of the parties as reflected from the material on record, it

does, prima facie, appear that the respondents conducted their affairs as

constituents of the Arshiya Group. Also, in as much, as, respondent no. 2 has

undertaken to honour respondent no. 1's obligations towards the petitioner as its

own primary obligations, and the petitioner has a right to claim from respondent

no. 2 the amounts allegedly due and payable by respondent no. 1 under the

lease, there is a commonality of interest between respondent No. 1 and

respondent no. 2. Moreover, looking at the dismal financial condition of

respondent no. 1 - as discussed hereinafter, a direction only to respondent no. 1

to furnish the required security might not afford adequate protection to the

petitioner. Therefore, I am of the opinion that the facts of the instant case are

such that orders under section 9 ought to be passed against respondent no. 2.

33. In my view, reliance by Ms. Loya on judgment of Division

Bench and learned Single Judge of Delhi High Court in Eveready

Industries India Ltd. (supra) and Gatx India Pvt Ltd. (supra) does not

assist the case of the Petitioner in light of the peculiar facts of the

present case. Those judgments may have been relevant for the

Petitioner to support its claim for enforcement of the award against

Vijay Sales in Commercial Arbitration Petition (L) No.29646 of 2024.

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What Ms. Loya is attempting to do is to seek a contradictory direction

to the one issued by this Court in order dated 4 July 2025 passed in

Enforcement Petition. While this Court has already held that the

foreign award is not enforceable against Vijay Sales, the Petitioner is

attempting to convince me that ‘Group of Companies’ doctrine and

doctrine of ‘lifting of corporate veil’ needs to be applied for

recognizing liability of Vijay Sales to pay awarded sum in the foreign

award against Amstrad/Ovot. I am afraid this cannot be done. In a

collateral proceedings filed for seeking interim measures under Section

9 of the Arbitration Act, Petitioner cannot seek recording of a finding

contrary to the one recorded in substantive proceedings filed for

enforcement of award. It cannot be countenanced that this Court

would record a finding of existence of liability of Vijay Sales to pay

sum awarded in foreign award passed against Amstrad/Ovot even

though in enforcement proceedings, name of Vijay Sales is directed to

be deleted holding that award cannot be enforced against it. Therefore,

in the peculiar facts and circumstances of the present case, neither

doctrine of ‘Group of Companies’ can be invoked nor can this Court

conduct an inquiry into liability of Vijay Sales arising out of guarantee

to satisfy the award amount directed against Amstard/Ovot.

34.Reliance by Petitioner on judgment of the Delhi High Court in

VLS Finance Limited also does not assist its case. In that judgment,

though the Delhi High Court has reiterated the principle of interim

measures against third parties in post-award Section 9 Petition, the

Court has cautioned that the interim measures cannot be for execution

of the award. The Court has held as under:

46. A cumulative reading of the judgments referred above, it is clear that while

considering a petition under Section 9 of the Act, the Court is within its right to

pass order against the third party. It is also clear that when the jurisdiction of the

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Court is invoked post award by way of petition under Section 9, interim protection

can be granted. The argument of the counsel for the respondents that some of

them not being parties before the Arbitral Tribunal, the petition under Section 9

would not be maintainable, need to be rejected. The judgment of the Supreme

Court in the case of Indowind Energy Limited (supra), as relied upon by Mr.

Singla, would not be applicable in the facts of this case wherein this Court is

concerned with a petition under Section 9 of the Act and not under Section 11 of

the Act. The Court should restrain itself from passing an order which has the

effect of implementing the award. Such order, if made, would frustrate the

challenge to the award under Section 34. The order should be such which would

secure the interest of the party having the award in its favour so as to seek effective

implementation, in the eventuality, the challenge to the award is rejected.

(emphasis added)

35.In Valentine Maritime Ltd. (supra) relied upon by the Petitioner,

Division Bench of this Court has reiterated the principles of wide

ambit of power under Section 9 of the Arbitration Act to make interim

measures. It is held thus:

65. A perusal of Section 9(1)(ii)(c) clearly indicates that the Court may authorize

any person to enter upon any land or building in the possession of the any party,

authorizing 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 for the purpose of detention, preservation or inspection of

any property which is subject matter of the dispute in Arbitration. For granting

such relief under Section 9(1)(ii)(c), third parties who are not parties to the

Arbitration Agreement may be affected. Such third parties who want to seek any

interim measures under Section 9 would not be entitled to invoke the said

provision for seeking interim measures against a party to the Arbitration

Agreement. However, there is no bar against the Court from granting interim

measures under Section 9 of the Arbitration Act against a party who is not a party

to the Arbitration Agreement, if those reliefs fall under any of the reliefs provided

in Section 9(1)(i), (ii)(a) to (e) of the Arbitration Act.

In the peculiar facts of the case, the Division Bench upheld the order

of the learned Single Judge directing interim measures against third

parties before commencement of arbitral proceedings. The judgment

has no application to the peculiar facts of the present case.

36.The remedy for interim measures under Section 9 of the

Arbitration Act is not a standalone remedy and it is in aid of some

substantive proceedings viz. arbitral proceedings or enforcement

proceedings. Once it is held in enforcement proceedings that there is

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no underlying liability against a third-party, Section 9 route cannot be

adopted to fasten the very same liability against that party in an

indirect manner. In the present case, it is held by the enforcement court

that Vijay Sales has no liability to pay to the Petitioner under the award

and enforcement proceedings are dismissed against it. Therefore, there

is no question of making any interim measures against Vijay Sales,

against whom the award is not enforceable.

37.Apart from the unique circumstance of deletion of Vijay Sales

from enforcement proceedings, it is also contended on behalf of

Respondents that no interim measures otherwise deserve to be granted

against Vijay Sales since Vijay Sales is not claiming through or under

Amstrad/Ovot. There can be no dispute to the position that in exercise

of power under Section 9 of the Arbitration Act, the Court can extend

its arm even to reach out a third-party for preserving subject matter of

arbitration or for securing the amount in dispute in arbitration.

However, while roping in third parties in exercise of powers under

Section 9, the Courts needs to be mindful of the fact that interim

measures can be made only when it is found that the third party is

claiming through or under the part to arbitration and in case of post-

award Petition, through or under the award debtor. Ordinarily, interim

measures cannot be made against a third party who c laims

independent right in respect of subject matter of arbitration. Reliance

by Mr. Tamboly in this regard on judgment of learned Single Judge of

Kerala High Court in Shoney Sanil (supra) is apposite, in which it is

held as under:

...A reading of the said provision would show that the orders under Section 9(ii)

(c) can be passed only in relation to the subject-matter of the dispute in

arbitration which may be in the possession of any party since it is not the

intention of the Act or any arbitration proceedings as conceived by the law of

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arbitration, to interfere with or interpolate third party rights. The reason for this

is obvious, that, an arbitral tribunal rests its authority on the agreement between

the parties to the arbitration agreement and it is not a Court, to interfere with

third party rights, as may the Courts authorised in that regard, by the law of the

land. The issuance of interim injunction or appointment of receiver provided for

under clause (d) and the residuary provision to issue such interim measure of

protection as may appear to be just and convenient in terms of clause (e) of

Section 9(i) and (ii) have to be read in the backdrop of the extent of jurisdiction

which can be exercised and, this is limited to the parties who are governed by

the arbitral agreement and not in excess thereof. On a plain reading of Section 9

of the Act and going by the scheme of the said Act, there is no room to hold that

by an interim measure under Section 9, the rights of third party, holding

possession on the basis of a Court sale could be interfered with, injuncted or

subjected to proceedings under Section 9 of the Act. Section 9 of the Act

contemplates issuance of interim measures by the Court only at the

instance of a party to an arbitration agreement with regard to the subject-

matter of the arbitration agreement. This can be only as against the party

to an arbitration agreement, or, at best, against any person claiming under

him. The writ petitioner is a third party auction purchaser in whose favour is a

sale certificate, followed by delivery of possession. He cannot therefore be

subjected to proceedings under Section 9 of the Act, initiated on the basis of an

alleged arbitral agreement between the respondents. ...

(emphasis and underlining added)

38. The judgment of Shoney Sanil (supra) is followed by Division

Bench of this Court in Girish Mulchand Mehta (supra) in which the

issue before this Court was whether interim measures can be made

against member of cooperative society when disputes arise in

connection with Development Agreement executed between a society

and the developer. Relying on judgment in Shoney Sanil (supra), the

Division Bench held in paragraphs 12 and 13 of the judgment in Girish

Mulchand Mehta (supra) as under:

12. The next question is whether order of formulating the interim measures

can be passed by the Court in exercise of powers under section 9 of the Act

only against a party to an Arbitration Agreement or Arbitration

Proceedings. As is noticed earlier, the jurisdiction under section 9 can be

invoked only by a party to the Arbitration Agreement. Section 9, however,

does not limit the jurisdiction of the Court to pass order of interim

measures only against party to an Arbitration Agreement or Arbitration

Proceedings; whereas the Court is free to exercise same power for making

appropriate order against the party to the Petition under section 9 of the

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Act as any proceedings before it. The fact that the order would affect the

person who is not party to the Arbitration Agreement or Arbitration

Proceedings does not affect the jurisdiction of the Court under section 9 of

the Act which is intended to pass interim measures of protection or

preservation of the subject-matter of the Arbitration Agreement.

13. The appellants, however, place reliance on the decision of the Kerala

High Court in the case of Shoney Sanil v. Coastal Foundations (P) Ltd.,

reported in AIR 2006 Kerala 206. In that case the question considered was

whether the writ-petitioner, admittedly, a third party to an alleged Arbitral

Agreement between the respondents inter se, and who had in his favour a

confirmed Court sale and certificate of such sale and delivery of possession,

following and arising under an independent decree, could be dispossessed,

injuncted or subjected to other Court proceedings under section 9 of the

Act? The Kerala High Court held that orders under section 9(ii)(c) can be

passed only in relation to subject-matter of dispute in arbitration which may

be in possession of any party since it is not the intention of the Act or any

arbitration proceedings as conceived by the law of Arbitration to interfere

with or interpolate third party rights. It concluded that on a plain reading of

section 9 of the Act and going by the Scheme of the said Act, there is no

room to hold that by an interim measure under section 9, the rights of third

party holding possession on the basis of Court sale could be interfered with,

injuncted or subjected to proceedings under section 9 of the Act. Instead, it

held that section 9 of the Act contemplates issuance of interim measures by

the Court only at the instance of party to Arbitration Agreement with

regard to the subject-matter of the Arbitration Agreement. The Court has,

however, noted that such order can be only against the party to an

Arbitration Agreement or at best against any person claiming under him.

The Principle expounded in this decision is that if a third party has

independent right in the subject-matter of the Arbitration Agreement,

section 9 cannot be invoked to affect his rights. At the same time, the Kerala

High Court has plainly opined that it is possible to pass orders under

section 9 against a third party if such person is claiming under the party to

the Arbitration Agreement. Thus understood, section 9 can be invoked even

against a third party who is not party to an arbitration agreement or

arbitration proceedings, if he were to be person claiming under the party to

the arbitration agreement and likely to be affected by the interim measures.

The appellants herein will have to substantiate that they were claiming

independent right in respect of any portion of the subject-matter of the

Arbitration Agreement on their own and not claiming under the respondent

No. 2 Society who is party to the Arbitration Agreement. In absence

thereof, the Court would certainly have jurisdiction to pass appropriate

order by way of interim measures even against the appellants herein,

irrespective of the fact that they are not party to the Arbitration Agreement

or the Arbitration Proceedings.

(emphasis and underlining added)

39.In

M/s. Value Advisory Services (supra) learned Single Judge of

Delhi High Court has held that when an attachment

qua

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properties/monies in the hands of third parties is sought, there is

always a possibility of such third party contesting the same and setting

up title in such property in himself. It is further held that when third

party denies the liability and when such denial raises disputes to

questions of fact, which cannot be adjudicated without conduct of

trial, powers under Section 9 of Arbitration Act cannot be exercised. It

is held in paragraphs 17 and 18 of the judgment as under:

17. However whenever attachment qua properties/monies in hands of third

parties is made, the possibility of such third party contesting the same

cannot be ruled out; while the party seeking attachment may aver the

property to be of person against whom he is seeking a decree, the third

party may set up title in such property in himself or in yet another party or

resist attachment on other grounds. Order 38 Rule 8 CPC provides for

adjudication of such claims by the court. The question which arises is,

whether and how such disputes to attachment, if raised pursuant to

attachment under Section 9 are also to be adjudicated. The necessary

corollary to what I have held above is that the court, even in a proceeding

under Section 9 will have to adjudicate such disputes. Order 38 Rules 7, 8

and 11A apply the provisions of attachment in relation to execution in

Order 21 Rules 46, 46A to F, to attachment before judgment also. Rule 46C

of Order 21 provides for trial of disputed questions where such third party

disputes liability, as a suit.

18. However, considering the nature of proceeding under Section 9, I find

that the court is not bound to, where the third party, with respect to

property/money in whose hands attachment is issued, denies liability and

such denial raises disputed questions of fact which cannot be adjudicated

without trial, to conduct trial. The court, in such cases in its discretion can

on a prima facie view of the matter, either refuse to exercise powers under

Section 9 or pass other appropriate order to protect the interest of all parties

concerned.

40.In the present case, Vijay Sales is not claiming under or through

Amstrad in respect of subject matter of arbitration. The case involves

attempt on the part of the Petitioner to enforce the guarantee against

Vijay Sales. This claim of guarantee was required to be adjudicated in

arbitral proceedings. Petitioner however chose to delete Vijay Sales

from arbitral proceedings and pressed claim only against Amstrad. To

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make things further worse for Petitioner, Vijay Sales is deleted even

from enforcement proceedings.

41.In the present case, there is no possibility of Award being

enforced against Vijay Sales on account of its deletion from

enforcement proceedings. When the foreign Award is not likely to

result in an enforceable decree under Section 49 of the Arbitration Act,

interim measure under Section 9 of the Arbitration Act cannot be

made against Vijay Sales. In this regard, following observations made

by learned Single Judge of this Court in Aircon Belbars FZE (supra) in

paragraph 10 of the judgment is apposite:

“If the foreign award does not result in an order of enforceability, then of

course a protective order under Section 9 cannot continue.”

42.To digress a bit, the judgment of the learned Single Judge in

Aircon Belbars FZE is also relevant for the issue of maintainability of

Petition under Section 9 of the Arbitration Act in relation to a foreign

Award, which has already been dealt with hereinabove and the

judgment has been upheld by the Division Bench in Heligo Charters

Private Limited (supra), to which the reference has been made in

preceeding paragraphs of the judgment. Coming back to the main

issue at hand, in my view therefore, no interim measure under Section

9 of Arbitration Act can be made against Vijay Sales for securing the

amount in dispute in the arbitration.

43.Petitioner’s submission about inextricable linkage between

Amstrad and Vijay Sales does not cut any ice in the light of deletion of

Vijay Sales from enforcement proceedings. If Amstrad and Vijay Sales

are indeed inextricably linked and such linkage makes Vijay Sales

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satisfy Amstrad’s liability under the foreign Award, this Court would

not have directed deletion of Vijay Sales from enforcement

proceedings. As observed above, order dated 4 July 2025 passed in

enforcement petition has attained finality as Ms. Loya has confirmed

that Petitioner has not challenged the said order. In that view of the

matter, the attempts to demonstrate inextricable linkage between

Amstrad and Vijay Sales or composite nature of transaction between

Guarantee Certificate and Proforma Invoice are misplaced. Similarly,

financial condition of Respondent No.1-Amstrad/Ovot or material

changes effected in the structural control and management of Amstrad

after the arbitral Award cannot be a ground for roping in Vijay Sales by

making interim measure of directing deposit of awarded sum or

provision of security in respect of the awarded sum. In my view

therefore, no relief can be granted in favour of the Petitioner against

Vijay Sales.

44.So far as Petitioner’s prayer for interim measures against

Respondent No.1-Amstrad/Ovot is concerned, it is seen that it has

already sought interim reliefs in Enforcement Petition (Commercial

Arbitration Petition (L) No.29646 of 2024) against Amstrad/Ovot and

the said Enforcement Petition is pending. Ms. Loya is quick enough to

respond stating that Petitioner has not sought direction for deposit in

the said Petition. In my view, mere failure on the part of the Petitioner

to seek direction for deposit in Enforcement Petition cannot be a

ground for maintaining separate Section 9 Petition. Petitioner cannot

divide interim prayers into Section 48 proceedings and Section 9

proceedings. It is also settled position of law that interim reliefs can

also be sought in enforcement proceedings filed under Sections 48 and

49 of the Arbitration Act.

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45.Petitioner has already sought interim relief in enforcement

Petition against Amstrad/Ovot. Having done so, it cannot maintain a

separate Petition under Section 9 of the Arbitration Act once again

seeking interim measures of different nature against Amstrad/Ovot.

In fact, I find considerable force in the submission of Respondents that

the present Petition is filed only after realizing that no relief is granted

against Vijay Sales in Enforcement Petition. This is clear from the

timing of filing of the present Petition. The order directing deletion of

Vijay Sales from Enforcement Petition was passed on 4 July 2025.

Immediately thereafter, the present Petition is filed on 16 July 2025.

The cause for filing present Petition is described by the Petitioner in

paragraph 25 to 28 of the Petition as under:

25. By an order dated 4 July 2025 (hereinafter referred to as the "4 July

Order"), this Hon'ble Court vacated the Disclosure Order insofar as it

pertained to Respondent No. 2 and deleted Respondent No. 2 as a party to

the Enforcement Petition. A copy of the said 4 July Order is annexed hereto

and marked as "Exhibit L".

26. At the hearing held on 4 July 2025, the Petitioner, inter alia, sought a

direction for deposit of the Awarded Amount by Respondent No. 1.

27. This request was made in light of the dated, evasive, and non-

transparent disclosures made in its Disclosure Affidavit, and the discovery

of several questiona ble acts of the Respondents discovered by the

Petitioner after the filing of the Enforcement Petition. A perusal of the

Disclosure Affidavit, read in conjunction with the financial & company

documents of Respondent No. 1 available on the official records of the

Ministry of Corporate Affairs (hereinafter referred to as "MCA"), raises

grave and well-founded apprehensions regarding the bona fides of

Respondent No. 1, as well as its intention and capacity to honour the

Award.

28. This Hon'ble Court was pleased to post the matter for further hearing on

18 July 2025, for consideration of the Petitioner's prayer for securing the

Awarded Amount. In view of the foregoing and to safeguard the fruits of

the Award, the Petitioner is constrained to file the present Petition.

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46.Thus, there is a specific admission in the Petition that after

deletion of Vijay Sales from enforcement petition on 4 July 2025,

Petitioner sought direction for deposit of awarded amount by

Amstrad/Ovot, which prayer was to be considered during the course

of further hearing on 18 July 2025. Despite this position, Petitioner has

filed the present Petition on 16 July 2025, which makes it abundantly

clear that present Petition is filed to get over the order dated 4 July

2025 passed in enforcement petition and to indirectly rope in Vijay

Sales in enforcement of award when direct relief against Vijay Sales is

rejected in enforcement proceedings.

47.Even otherwise, the Petitioner has secured a monetary Award

against Respondent No.1-Amstrad/Ovot. It has secured order for

disclosure against Respondent No.1-Amstrad/Ovot. It is claimed by

Respondent No.1-Amstrad/Ovot that it has a positive net worth.

Respondent No.1 has denied that it has weak or precarious financial

position. Petitioner can accordingly seek enforcement of the Award

against Respondent No.1-Amstrad/Ovot. It is well-settled position that

direction for deposit of awarded amount under Section 9 of the

Arbitration Act cannot be resorted to as a shortcut method to

execution. Reliance placed by Respondents on judgment of Delhi High

Court in National Highways Authority of India (supra) in this regard

is relevant, in which it is held in paragraphs 27.3 and 27.4 as under:

27.3 Section 9 cannot, quite obviously, be regarded as a shortcut to avoid

Section 36. In fact, it is not often that one encounters a postaward Section 9

petition. Orders of deposit of the awarded amount are generally passed by

the executing court, which is activated by the award holder under Section

36, or by the Court in which the unsuccessful award debtor challenges the

award under Section 34.

27.4 Quite obviously, therefore, a direction for deposit of the awarded

amount, under Section 9, is not routinely to be passed. It is plain that the

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mere fact that an amount stands awarded, irrespective of the magnitude of

the amount, cannot constitute the basis for the award holder to seek, from

the Court, a direction to the award debtor to deposit the awarded amount.

Such orders, if passed, have to be reserved for rare and exceptional cases, in

which deposit of the awarded amount is absolutely imperative to protect the

interests of the award holder.

48.In my view, no extraordinary case is made out by the Petitioner

for directing deposit of awarded amount in the Petition filed under

Section 9 of Arbitration Act especially when the enforcement petition

is pending and Petitioner has sought interim reliefs against Respondent

No.1-Amstrad/Ovot in the said Petition.

CONCLUSION

49.Considering the overall conspectus of the case, I am of the view

that no relief can be granted in favour of the Petitioner in the present

Petition. The Commercial Arbitration Petition is accordingly

dismissed. Considering the facts and circumstances of the case, there

shall be no order as to costs.

(SANDEEP V. MARNE, J.)

katkam Page No. 35 of 35

SUDARSHAN

RAJALINGAM

KATKAM

Digitally

signed by

SUDARSHAN

RAJALINGAM

KATKAM

Date:

2026.01.28

15:12:18

+0530