#Asset Preservation

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 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.

Bombay High Court grants interim asset disclosure and injunction under Section 9 of the Arbitration Act, affirming courts' power to preserve subject matter before arbitral proceedings commence.