JUDGMENT M. Katju and S.L. Saraf, JJ.
1. Although we have passed separate orders in this writ petition, yet we are agreed that Section 9 of the Arbitration and Conciliation Act, 1996 applies also to the proceedings under Part II of the Act and hence Interim relief can be granted by the civil court pending the arbitration proceedings.
2. However, the Forum for filing an application under Section 9 of the Act is not the High Court but the civil court.
3. The petition is disposed of.
M. Katju, J.
4. Heard learned counsel for the petitioner. Sri Rajesh Kumar learned counsel for the respondent Nos. 3 and 4, as well as Sri Mohd. is a Khan learned counsel for the respondent No. 1.
5. Without going into the merits of the case, we are of the opinion that Section 9 of the Arbitration and Conciliation Act, 1996 which provides for interim measures during arbitral proceedings applies also to provision under Part II of the Act. No doubt Section 2(2) of the Act states that Part 1 applies where the place of arbitration is in India and Section 9 is in Part I of the Act.
but it is a settled principle of interpretation that in construing statutes, we must see the scheme of the Act, the context, the object, etc.
6. A challenge has been made to Section 45 of the Act, but we are of the opinion that the Court should endeavour to uphold the constitutionality of a provision even if for that purpose, we have to give a strained interpretation, rather than putting an interpretation which makes the statute unconstitutional by taking its plain meaning. In our opinion, if Section 9 is treated as inapplicable to Part II, it will make Section 45 too harsh. The purpose of Section 9 is to give interim protection during arbitration proceedings. In our view, interim protection under Section 9 can be given by the Court in all kinds of arbitration proceedings, even those under Part II. otherwise irreparable loss may be caused.
7. In the circumstances, we dispose of this petition with the liberty to the petitioner to move an application under Section 9 of the Act to the Court concerned which will decide the same in accordance with law and in the light of the observations made above.
S.L. Saraf, J.
8. Heard learned counsel for the parties.
9. The present petition relates to a matter which is essentially a civil dispute between petitioner No. 1 and a foreign collaborator. The petitioners had entered into an agreement with respondent No. 2, inter alia, for transfer of technology in respect of certain two-wheeler vehicles. The dispute between the parties as per the terms of agreement has now been referred to the arbitration of International Chamber of Commerce and the same is to proceed or is proceeding in accordance with the Rules of the said Chamber.
10. Rule 23 (2) of the International Chamber of Commerce Rules (for short I.C.C. Rules) reads as follows :
"23.2. Before the file is transmitted to the Arbitral Tribunal, and in appropriate circumstances even thereafter, the parties may apply to any competent Judicial authority for interim or conservatory measures. The application of a party to a judicial authority for such measures or for the implementation of any such measures ordered by an Arbitral Tribunal shall not be deemed to be an infringement or a waiver of the arbitration agreement and shall not affect the relevant powers reserved to the Arbitral Tribunal. Any such application and any such measures taken by the judicial Authority must be notified without delay to the Secretariat. The Secretariat shall inform the Arbitral Tribunal thereof."
11. Similar provision is made under Section 9 of the Arbitration and Conciliation Act. 1996, which reads as under :
"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 a 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, preserva-tion 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 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 purposes of. and in relation to, any proceedings before it."
12. Section 45 of the Arbitration and Conciliation Act, 1996 reads as follows :
"Power of Judicial authority to refer parties to arbitration.--Notwithstanding anything contained in Part I or in the Code of Civil Procedure, 1908 (V of 1908), a judicial authority, when seized of an action in a matter in respect of which the parties have made an agreement referred to in Section 44, shall, at the request of one of the parties or any person claiming through or under him. refer the parties to arbitration, unless it finds that the said agreement is null and void, inoperative or incapable of being performed."
13. A reading of the above provisions makes it abundantly clear that Section 9 of the 1996 Act read with Rule 23.2 of the I.C.C. Rules empowers the civil court to pass orders for interim relief. Non-obstante clause of Section 45 does not exclude the powers of civil court to grant Interim relief. Non-obstante clause is not an impediment but is an enabling provision authorising the judicial authority to refer the parties to arbitration without restricting the powers of civil court to grant interim relief under Section 9 of the Act. Rule 23.2 of the I.C.C. Rules specifically lays down that before the file is transmitted to the Arbitral Tribunal in appropriate circumstances, even thereafter, the parties may apply to any competent judicial authority for interim or conservatory measures. The substantial and ultimate relief can only be resolved by the arbitration of International Chamber of Commerce. However, it is made clear that the above observations are purely obiter and the Court is expressing no opinion as to the applicability, validity or the scope of the aforesaid provisions.
14. Peculiarly enough, without resorting to the abovementioned procedure, the petitioners have filed writ petition praying for a declaration that Section 45 of the Arbitration and Conciliation Act. 1996 be declared ultra vires, unconstitutional and bad in law. No other relief was sought for in the writ petition. At the behest of the Court, a consequential relief was sought for and allowed to be added as follows :
"issue a writ of mandamus commanding opposite party No. 2 not to act in violation of the agreement which is the subject-matter of agreement between the parties."
15. Obviously, the added relief sought for is the relief against the private party asking for a direction from this Court against respondent No. 2 not to act in violation of the agreement. Such a relief is purely a civil matter arising out of the arbitration proceedings between the private parties and the same cannot be granted by the Court exercising power under Article 226 of the Constitution of India.
16. The main relief sought for in the writ petition is purely a declaratory relief. It is well-settled that Article 226 should not be used and was not Intended to be used as a medium or means for declaratory orders or declaratory reliefs declaring Acts and orders invalid even though no relief could be granted to the petitioner. The Court should not issue writs of consolation or writs propounding theories. That is not the function, scope and purpose of Article 226. Nor should it be utilised for subsequent claims in future legal proceedings. (See AIR l96GCal60I at page 603.
17. The Allahabad High Court has observed in a decision in AIR 195$ All 477 at page 479, that this Court has consistently taken the view that the powers of issuing writs, orders or directions should not be utilised for giving what is in essence a declaratory relief.
18. Further, the Supreme Court in AIR 1951 SC 41. It has been held that advisory opinion or declaratory judgment on the constitutionality of legislation cannot be given under Article 226 of the Constitution of India.
19. Summing up the above discussion, we hold that:
(a) the present petition is totally misconceived and no order can be passed on this petition :
(b) the dispute in the present writ petition is purely private dispute between petitioner No. 1 and foreign collaborator, referable to the arbitration of International Chamber of Commerce and no writ of mandamus against a private party arbitrating before the International Chamber of Commerce, can be Issued by this Court exercising powers under Article 226 of the Constitution of India ; and
(c) Article 226 is not intended nor is the forum for passing declaratory orders or declaratory reliefs.
20. In view of above, the present writ petition stands dismissed in limine.