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2020 (6) TMI 452 - HC - Indian LawsArbitration agreement - Applicability on the party who is not the signatory of the agreement - Scope of Section 9 of the Arbitration and Conciliation Act, 1996 - Securing of money received from the sale proceeds of the auction of the hotel in Goa - Bidding Process - whether the relief claimed by the Petitioner for directing Respondent No. 2 to deposit the amount of ₹ 85 crores along with accrued interest, lying in the banks in the form of FDRs, in the custody of Respondent No.2, in this Court and a further direction not to disburse the same to Respondent No.1, can be granted? HELD THAT:- the scope of power of a Court under Section 9 of the Act is not limited to parties to an Arbitration Agreement and the Court can issue interim directions even against a third party. The distinction between the powers under Section 9 of the Act and Section 17 of the Act has a clear rationale. An Arbitrator is a creature of the contract between the parties and therefore cannot venture outside the contract to issue directions to parties who are non-parties to the Arbitration Agreement. This limitation is not applicable to a Court exercising power under Section 9 of the Act. As brought out by IFCI, pursuant to Order dated 27.08.2018, SEBI has already written to IFCI seeking release of the money and the same is pending due to a communication of Respondent No.1 that it would be taking steps in the pending writ petition against the release of money. Petition filed by Respondent No.1 in Bombay High Court for redemption of his property is still pending and its claims are yet to be adjudicated against Respondent No.2. Therefore, at present it cannot be argued by the Petitioner that Respondent No.2 is holding the sum of ₹ 85 Crores as a Custodian of Respondent No.1, so as to be entitled to the reliefs sought herein. The objection raised by Respondent No.2 on its being a non-party and non-signatory to the Arbitration Agreement, becomes irrelevant and does not require any further adjudication - Reliefs sought by the petitioner cannot be granted by this Court - Petition dismissed.
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