ARCELOR MITTAL NIPPON STEEL INDIA LTD. versus ESSAR BULK TERMINAL LTD.

ARCELOR MITTAL NIPPON STEEL INDIA LTD. versus ESSAR BULK TERMINAL LTD.

The bar in Section 9(3) operates only after constitution of an arbitral tribunal; however if a Court has already 'entertained' a Section 9 application (i.e., taken it up for consideration and applied its mind, including instances where hearing concluded and orders reserved before constitution) the Court may proceed to adjudicate and it need not remit the parties to Section 17 or re-examine efficacy of the arbitral remedy. Conversely, where the application had not been entertained before constitution of the tribunal, the Court should not take it up unless the court finds the remedy under Section 17 to be inefficacious.

Parties
Appellant: Arcelor Mittal Nippon Steel India Ltd.; Respondent: Essar Bulk Terminal Ltd.
Jurisdiction
India
Judgment Date
14 September 2021
Procedural Posture
Civil Appeal / On Appeal From Gujarat High Court Order Dated 17.08.2021
Outcome
Appeal partly allowed
Legal Topics
Interim Measures, Section 9(1) and Section 9(3) of Arbitration and Conciliation Act, 1996, Section 17 Efficacy, Meaning of 'entertain', Competence Competence / Jurisdictional Priority
Arbitration Interim Measures Section 9(1) and Section 9(3) of Arbitration and Conciliation Act, 1996 Section 17 Efficacy Meaning of 'entertain' Competence Competence / Jurisdictional Priority

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Parties

Arcelor Mittal Nippon Steel India Ltd.

Appellant

Essar Bulk Terminal Ltd.

Respondent

Procedural Posture

Civil Appeal / On Appeal From Gujarat High Court Order Dated 17.08.2021

Legal Issues

  1. 1 Whether a Court can entertain an application under Section 9(1) after an arbitral tribunal has been constituted
  2. 2 What is the meaning and scope of the word 'entertain' in Section 9(3)
  3. 3 Whether the Court must examine the efficacy of remedy under Section 17 once an arbitral tribunal is constituted

Ratio Decidendi

The bar in Section 9(3) operates only after constitution of an arbitral tribunal; however if a Court has already 'entertained' a Section 9 application (i.e., taken it up for consideration and applied its mind, including instances where hearing concluded and orders reserved before constitution) the Court may proceed to adjudicate and it need not remit the parties to Section 17 or re-examine efficacy of the arbitral remedy. Conversely, where the application had not been entertained before constitution of the tribunal, the Court should not take it up unless the court finds the remedy under Section 17 to be inefficacious.

Court Disposition

Appeal partly allowed

Orders

  • Appeal partly allowed.
  • Clarification that Commercial Court shall not be required to consider efficacy of relief under Section 17 since the Section 9 application had already been entertained and considered by the Commercial Court.