#Arbitration and Conciliation

The Bombay High Court has ruled that a petitioner need not wait for the arbitral tribunal to be constituted to seek interim relief under Section 9 - showing a prima facie breach and credible risk of asset dissipation is sufficient. This empowers lenders and creditors to act swiftly in commercial disputes, preventing irreparable harm before arbitration even begins.

The Bombay High Court clarifies that an injunction under Section 9 of the Arbitration Act is a negative restraint on disposal, not an order for attachment or freezing of bank accounts. Misinterpreting such orders as authority to freeze accounts invites contempt, as it disrupts legitimate business operations and exceeds the statutory purpose of asset preservation.

The Bombay High Court ruled that registering a development agreement alone is insufficient to establish a prima facie case for interim relief under Section 9. The petitioner must demonstrate concrete readiness and willingness to fulfill contractual obligations, reinforcing that procedural formality cannot substitute for substantive performance capacity. This sets a critical precedent for developers and cooperative societies in redevelopment disputes.

The Madhya Pradesh High Court has ruled that business relationships, invoice references, or assignment of rights alone cannot bind non-signatories to arbitration clauses. Only explicit consent or demonstrable status as a veritable party to the contract can create privity of contract for arbitration purposes, setting a strict threshold for enforcing arbitration against third parties in commercial disputes.

The Karnataka High Court ruled that accepting Rs. 2.55 crore in instalments under a Joint Development Agreement, despite non-possession, confirms the agreement remains operative. This conduct triggers Section 9 relief to freeze property alienation, ensuring the status quo is preserved for arbitration - a critical precedent for developers and landowners in unresolved JDA disputes.

The Bombay High Court has ordered a respondent in arbitration to disclose all movable, immovable, bank, and demat assets, and appointed a Court Receiver to take symbolic possession of unattached properties. This sets a new benchmark for asset preservation, ensuring claimants aren't left remedy-less when respondents conceal or dissipate assets before arbitration concludes.

The Bombay High Court has ruled that subcontractors cannot be bound by an arbitration clause from a main contract unless the clause is expressly incorporated with specific reference under Section 7(5) of the Arbitration and Conciliation Act. This clarifies consent requirements for non-signatories and impacts construction and infrastructure disputes where subcontracting is common.

The Madhya Pradesh High Court ruled that when factual disputes exist over limitation periods in arbitration referrals, the issue must be adjudicated by the arbitral tribunal, not the court during Section 11 appointment proceedings. This clarifies the limited scope of judicial review at the arbitrator appointment stage, reinforcing tribunal autonomy in contested factual matters.

The Supreme Court has ruled that when a subsequent contract explicitly states that all terms of a prior agreement form part of it, the arbitration clause in the earlier contract is validly incorporated - even without repeating its language. This clarifies the legal standard for incorporation by reference, empowering developers and parties in real estate and commercial contracts to enforce arbitration where clear contractual language exists.

The Allahabad High Court reaffirmed that under Section 11(6A), judicial intervention is confined solely to verifying whether an arbitration agreement exists - not evaluating the validity, performance, or termination of the underlying contract. This clarifies that even disputed contract terminations cannot justify judicial scrutiny of merits, reinforcing the pro-arbitration stance of the 2015 Amendment and protecting parties from procedural delays.

The High Court of J&K & Ladakh ruled that a mere general reference to a standard dealership agreement in a temporary appointment does not automatically incorporate its arbitration clause. The decision underscores the need for explicit inclusion of arbitration terms in contracts, impacting businesses relying on standard agreements for dispute resolution.

The Bombay High Court ruled that nine years of inactivity in arbitration, without any communication or effort to revive proceedings, does not automatically constitute abandonment. Only where conduct clearly indicates an intention to relinquish the reference can the mandate be terminated under Section 32(2)(c), barring appointment of a substitute arbitrator. This sets a high threshold for termination, protecting parties from premature extinguishment of arbitration rights.

J&K & Ladakh HC clarifies that post-decretal interest on arbitral awards under the J&K Arbitration Act, 1945, is calculable only on the principal sum, excluding pre-reference and pendente lite interest. This ruling diverges from the broader interpretation permitted under the State CPC, impacting execution of awards in arbitration disputes.

Bombay HC rules that a developer's prolonged delay in a housing society redevelopment project disentitles it to interim relief under Section 9 of the Arbitration Act. The court prioritized the society members' right to safe housing over the developer's contractual claims, setting a precedent for balancing equities in stalled projects.

The Jharkhand High Court has ruled that filing an appeal under Section 37 of the Arbitration Act after 216 days without seeking condonation of delay is fatal to maintainability, even if the limitation period under the Commercial Courts Act is invoked. This reinforces that procedural compliance is non-negotiable - registry objections and failure to file condonation applications cannot be overlooked, setting a strict precedent for commercial litigants and arbitrators.