Bombay-High-Court-Upholds-Section-9-Powers-Despite-Stamp-Duty-IssuesBombay-High-Court-Upholds-Section-9-Powers-Despite-Stamp-Duty-Issues

The Bombay High Court affirms Section 9 authority in granting interim measures under the Arbitration and Conciliation Act, irrespective of stamp duty concerns. An analysis of the court’s stance and its implications on arbitration proceedings.

Bombay High Court’s Stand on Section 9 Powers

The Bombay High Court recently clarified its position on Section 9 powers under the Arbitration and Conciliation (A&C) Act, asserting that the judgment in the N.N. Global case does not hinder the court’s authority to grant interim measures despite stamp duty inadequacies.

Background: Multiple Petitions under Section 9

In a consolidated hearing of five petitions under Section 9 of the A&C Act, petitioners sought interim reliefs at the pre-arbitration stage. The respondents objected, citing insufficient stamping in agreements containing arbitration clauses, as required by the Maharashtra Stamps Act.

Petitioner’s Arguments and Unique Scope of Section 9

The petitioners contended that Section 9, distinct from Sections 11 and 8 of the A&C Act, allows the court to focus on immediate relief parameters without delving into arbitration agreement validity. They emphasized the three-fold test of a prima facie case, balance of convenience, and irreparable injury.

Respondent’s Counter-Arguments on Enforceability

Respondents argued that inadequately stamped agreements, once deemed void, should not receive court assistance. They highlighted the requirement for agreements to conform to Section 7 of the Arbitration Act and Contract Act, 1872.

Court’s Analysis: Distinction and Admissibility

The court clarified that Section 9 addresses interim relief, not the validity of arbitration agreements, unlike Section 11. It emphasized that stamping concerns should not obstruct interim measures. Admissibility issues, including stamping, can be addressed when documents are produced as evidence.

Analogies to Civil Suits and Upholding Section 9 Powers

Drawing parallels to civil suits, the court asserted that interim relief powers under Section 9 remain unaffected by stamp duty issues. It underlined that the court can grant interim relief under Orders 38 and 39 of the CPC despite stamp duty inadequacies.

Conclusion: Ensuring Access to Interim Relief

In conclusion, the Bombay High Court’s stance ensures that parties seeking interim relief under Section 9 are not unduly burdened by stamp duty concerns at the early stage. The court’s jurisdictional duty involves examining stamp duty during evidentiary stages, aligning with its commitment to uphold the arbitration process.

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