National Projects Construction Corporation Ltd v. Ishvakoo (India) Pvt. Ltd
2026 INSC 828 · CIVIL APPEAL NO. 5819 OF 2025
Coram: K. V. Viswanathan; Alok Aradhe
Arbitration and Conciliation Act, 1996 — s.9 — s.34 — Post-award interim relief — Maintainability at instance of Award Debtor — Bank guarantee — Unjust enrichment —
Arbitration and Conciliation Act, 1996 — s.9 — Post-award petition by unsuccessful party is maintainable —
Held: A petition under Section 9 at the post-award stage, filed by a party with no enforceable award in its favour, is maintainable in law, though the threshold for interim relief is correspondingly higher. (¶18, 19)
Arbitration and Conciliation Act, 1996 — s.9 — Continuation of interim protection in rare and compelling cases —
Held further: In rare and compelling cases, an unsuccessful party may invoke Section 9 to seek continuation of existing interim protection, such as a restraint on invoking a bank guarantee, to prevent irreparable prejudice and preserve the efficacy of its Section 34 challenge. (¶19)
Arbitration and Conciliation Act, 1996 — s.9 — Prima facie case, balance of convenience, reasonable expedition —
Held further: Grant of interim relief under Section 9 is governed by the existence of a prima facie case, balance of convenience, likelihood of irreparable harm, and whether the applicant approached the court with reasonable expedition. (¶20, 21, 22, 23)
Arbitration and Conciliation Act, 1996 — s.9 — Deposit direction upheld to prevent unjust enrichment —
Held further: Since no counter-claim was filed and the discharge of the bank guarantees was never decided, retaining the encashed amount pending the Section 34 challenge would unjustly enrich the appellant. The deposit direction is upheld and the appeal dismissed. (¶26, 27)
In the Court's own words
Paragraph 18This is a case where the Award Debtor has, post the Award, invoked the jurisdiction under Section 9. Insofar as the maintainability of a Section 9 application by the Award Debtor is concerned, the issue is no longer res integra. Recently, in Home Care Retail Marts Pvt. Ltd. vs. Haresh N. Sanghavi, 2026 SCC Online SC 670, this Court, speaking through Manmohan, J., held as under: - “2. The substantial question of law that arises for consideration in the present batch of appeals is whether a petition under Section 9 of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as ‘the Act’) at the post-award stage, by a party that has lost in the arbitral proceedings and has no enforceable award in its favour, is maintainable in law? 43. Sections 34 as well as 36 provide remedies against an award or a stay thereof, whereas Section 9 ensures protection of the subject matter or the amount in dispute. An unsuccessful party cannot secure protection of its claim under Section 34 or Section 36. To deny interim relief under Section 9 would leave such a party remediless. In fact, if the Court declines to entertain an application of a losing party for interim relief, there would be no forum available for protection of the subject matter, even where the award under challenge is stayed and potentially liable to be set aside. Moreover, the ultimate outcome may alter the rights of parties and, therefore, distinction between a ‘winning’ and a ‘losing’ party cannot govern access to the remedy under Section 9 of the Act. 49. Even applying the test of purposive interpretation, ‘a party’ must mean any party to the arbitration agreement. This Court can envisage situations where a party that has lost in arbitration may nonetheless require interim protection. For instance, where an arbitral award has been rendered without proper notice to a party, or where a party is able to prima facie demonstrate that the award has been induced or tainted by fraud or corruption. In such situations, the Court may not only stay the award but also grant interim measures under Section 9 of the Act to balance the equities. Similarly, in certain cases, an unsuccessful party may have obtained interim protection during the arbitral proceedings, such as an order restraining invocation of a bank guarantee. Upon the rendering of the arbitral award, such interim protection ordinarily stands vacated. However, the unsuccessful party may challenge the award under Section 34 of the Act and obtain a stay on the enforcement of the arbitral award under Section 36(3) of the Act. In such circumstances, immediate removal of interim protection, for example, in relation to a bank guarantee, may result in irreversible prejudice to the unsuccessful party whose challenge to the arbitral award is pending adjudication. 52. Consequently, in rare and compelling cases, it may be necessary to permit the unsuccessful party to invoke Section 9 of the Act to seek continuation of the existing interim protection. This assumes greater significance, as noted earlier, in light of the decision in Gayatri Balasamy (supra) which recognises the Court's power under Section 34 of the Act to modify an arbitral award, including the power to sever ‘the “invalid” portion from the “valid” portion of the award’. 59. Needless to say, the grant of interim relief under Section 9 of the Act will continue to be guided by well- established principles, namely, the existence of a prima facie case, balance of convenience, and likelihood of irreparable harm or injury. This Court, in Essar House Private Limited v. Arcellor Mittal Nippon Steel India Limited, (2022) 20 SCC 178, has held as under: “47. Section 9 of the Arbitration Act confers wide power on the Court to pass orders securing the amount in dispute in arbitration, whether before the commencement of the arbitral proceedings, during the arbitral proceedings or at any time after making of the arbitral award, but before its enforcement in accordance with Section 36 of the Arbitration Act. All that the Court is required to see is, whether the applicant for interim measure has a good prima facie case, whether the balance of convenience is in favour of interim relief as prayed for being granted and whether the applicant has approached the court with reasonable expedition.” 60. Undoubtedly, the threshold for grant of interim relief will be higher in the case of an unsuccessful party in arbitration seeking such relief. In rare and compelling cases, permitting the unsuccessful party to invoke Section 9 of the Act would prevent irreparable prejudice and preserve the efficacy of the challenge proceedings. However, the rights of such a party cannot be curtailed merely on the apprehension of possible misuse of a statutory provision.” [Emphasis supplied]
Paragraph 19This Court, while holding the application to be maintainable, has sounded a note of caution that the threshold for grant of interim relief will be higher in case the application is moved by an Award Debtor and that a court may, in rare and compelling cases, permit the unsuccessful party to invoke Section 9 to prevent irreparable prejudice and to preserve the efficacy of the challenge under Section 34.