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Supreme Court of India

M/S. ARVIND CONSTRUCTIONS CO. PVT. LID.versusM/S KALINGA MINING CORPORATION AND ORS.

Citation
2007 INSC 614
Decided
17 May 2007
Disposal
Dismissed

Holding

Re‑registration of the partnership does not affect its continuity; the appeal is maintainable and the interim order under Section 9 should not be interfered with, leaving the substantive disputes to be decided by the appointed sole arbitrator.

Summary

The appellant, Mis Arvind Constructions Co. Pvt. Ltd., entered into a 1991 agency agreement and irrevocable power of attorney with Mis Kalinga Mining Corporation, a partnership firm originally registered in 1949 and later re‑registered in 2005 under the same name. After the agreement expired in 2006, disputes arose and the parties invoked an arbitration clause; however, the nominated arbitrators failed to appoint a presiding arbitrator, prompting the appellant to seek a third arbitrator under Section 11(4)(b) of the Arbitration and Conciliation Act, 1996, and interim relief under Section 9 of the same Act. The District Court ordered a status‑quo until the arbitral tribunal was constituted, but the High Court set aside that order, holding the agreement was not specifically enforceable under the Specific Relief Act. The Supreme Court held that the re‑registration did not dissolve the original partnership, so the appeal was maintainable, and that the matters concerning the agreement and power of attorney are for the arbitral tribunal, not for interlocutory judicial interference. Consequently, the Court declined to disturb the High Court’s order, dismissed the appeal, and appointed a sole arbitrator to decide the substantive disputes.

Issues considered

  • The maintainability of the appeal filed by the partnership firm re‑registered in 2005 despite the original contract being with the 1949 firm.
  • Whether the interim order under Section 9 of the Arbitration and Conciliation Act, 1996 should be set aside in view of the Specific Relief Act.
  • Whether the dispute over the agency agreement and power of attorney is for the arbitral tribunal or the court at the interlocutory stage.
  • The effect of re‑registration on the continuity and legal status of the partnership firm.

Legislation cited

Subjects

ArbitrationSection 9 interim reliefPartnership re‑registrationSpecific Relief ActAgency agreementPower of attorneyArbitrator appointmentCivil appeal

Judgment

A                 MIS. ARVIND CONSTRUCTIONS CO. PVT. LID.
                                    v.
                 MIS KALINGA MINING CORPORATION AND ORS.

                                     MAY 17, 2007

B          [TARUN CHATIERJEE AND P.K. BALASUBRAMANYAN, JJ.]


           Partnership Act : 1832 !

            Partnership firm-Re-registration-Effect of-Firm registered in 1949-
C Again registered comprising some of the original partners in 2005 with the
     same name-Earlier firm not dissolved-Held, registration of the firm in the
     same name again in 2005 does not affect the status of the firm.

           Arbitration and Conciliation Act, 1996 :

D           ss. 9 and 11 (4) (b)-lnterim order by District Judge u/s 9-Propriety
     of-Arbitration clause is an agency agreement-Agreement for a specific
     period having come to an end-Parties nominating their respective arbitrators
     but both the arbitrators so nominated failing to nominate presiding
     arbitrator-Application u/s 11 (4)(b) before Chief Justice of High Court for
E    appointing third arbitrator-Meanwhile on application, District Judge
     granting interim order to maintain status quo until arbitral tribunal takes
     the matter-High Court vacating the interim order-Held, Adequate grounds
     are not made out at this interlocutory stage for interfering with order ofHigh
     Court and parties are left to have their disputes resolved in terms ofarbitration
     agreement-As agreed by both the parties, sole arbitrator appointed to
F    decide the disputes between the parties-Except the question ofmaintainability
     of appeal filed by respondent before High Court on the pretext of re-
     registration, since, the appeal has been held to be maintainable, all the other
     questions are left open for decision by the sole arbitrator.

           Respondent no. 1, a partnership firm was constituted in the year 1949
G bearing registration no. 71/1949. It was reconstituted in subsequent years
     taking in some additional partners. On 14.3.1991 the respondent-firm entered
     into an agency agreement with the appellant, a private limited company,
     engaging the latter as a raising contractor in respect of the mines for which
     the former had obtained leases from the State Government. On 25.3.1991 the
If                                         180
                        ARVINDCONSTRUCTIONS CO. PVT. LTD. v. KALINGA MININGCORPN.    181

       respondent firm executed an irrevocable power of attorney in favour of the           A
 ~

  '
       appellant authorizing it to administer the mines and sell the iron ore extracted
       therefrom. The agency agreement was to end on 31.3.2006. The appellant
       sought a further extension of the term but respondent no.1 was not willing
       for an extension. Disputes arose between the parties and by a letter dated
       9.12.2005 the appellant invoked the arbitration clause in the agency
       agreement and nominated its arbitrator. The respondent firm registered itself        B
       again on 24.12.2005 bearing registration no. 595/2005. It, however, in turn
       also nominated an arbitrator. The arbitrators so nominated were tc name the
. .J
       presiding arbitrator but since they failed to do so the appellant filed a petition
       under Section 11(4)(b) of the Arbitration and Conciliation Act, 1996
       requesting the Chief Justice of the High Court to appoint the third arbitrator.      c
       While the said application was pending, the appellant company also filed an
       application under Section 9 of the Act before the District Judge for interim
       relief to permit it to continue to carry on the mining operations and to restrain
       the respondent from interfering with it. The District Judge directed status
       quo to be maintained until arbitral tribunal was constituted to adjudicate the
       dispute between the parties. The respondent filed an appeal before the High          D
       Court which held that since primafacie the agreement between the parties
  j    was not a specifically enforceable one in terms of the Specific Relief Act and
       since the terms of the agreement had expired, it was not appropriate to grant
       the interim order, and reversing the order of the District Judge, dismissed
       the application filed by the appellant-company. Aggrieved, the latter filed the      E
       instant appeal.

             It was contended for the appellant that it had entered into agreement
       with the firm bearing registration no. 71/1949, and since the appeal before
       the High Court was filed by the firm bearing registration no. 595/205, the
       same was not maintainable; that since the agreement entered with the appellant       F
  <    was, in the light of irrevocable Power of Attorney, co-terminus with the mining
       lease granted to the respondent firm, the same could not be terminated and
       would not come to an end by efflux time; and that powers under Section 9 of
       the Act, were independent of any restrictions placed by Specific Relief Act.

            Dismissing the appeal, the Court                                                G
             HELD: 1. It was the appellant who filed the application under Section 9
       of the Arbitration and Conciliation Act, 1996 impleading the respondent firm
 >     and its partners. The said firm represented by a partner, who even admittedly
       was a partner of the firm as constituted in the year 1949 and was also a party
                   "'
                                                                                            H
    182                    SUPREME COURT REPORTS                      (2007) 7 S.C.R.

A to the agreement with the appellant-company itself, had filed the appeal before
    the High Court. There is no case that the firm registered in the year 1949
    had been dissolved. On the other hand, it was being reconstituted from time
    to time. Therefore, the fact that a firm in the same name was again registred
    in the year 2005, does not affect the status of the firm with which the appellant-
B   company had a contract and the filing of the appeal by that firm represented
    by its partner. (Part 11) (187-B, C, DJ

          2. The effect of the agreement dated 14.3.1991 and the Power of Attorney
    dated 25.3.1991 admittedly executed between the parties and the rights and
                                                                                         l
    obligations flowing therefrom are really matters for decision by the Arbitral
C   Tribunal. (Para 12) (187-F)

          3.1. In the facts and circumstances,primafacie, it is not possible to say
    that the High Court was wrong in thinking that it may be a case where an
    injunction could not be granted in view of the provisions of the Specific Relief
    Act. But, that again will be a question for the arbitrator to pronounce upon.
D   Suffice it to say that the position is not clear enough for this Court to assume
    for the purpose of this interlocutory proceeding that the appellant is entitled
    to specifically enforce the agreement dated 14~3.1991 read in the light of the
    Power of Attorney dated 2.5.3.1991. Of course, this aspect will be again
    subject to the contention raised by the appellant-company that the agreement
    created in his favour was co-terminus with the mining lease itself. But, these
E   are the aspects to be considered by the Arbitral Tribunal Adequate grounds
    are not made out by the appellant at this interlocutory stage for interfering
    with the order of the High Court. In that view alone, it would be proper to
    decline to interfere with the order of the High Court and leave the parties to
    have their disputes resolved in terms of the arbitration agreement between
F   the parties. [Para 13 and 14) [188-B, C, D, E]

          4. The argument that the power under Section 9 of the Act is independent
    of the Specific Relief Act or that the restrictions placed by the Specific Relief
    Act cannot control the exercise of power under Section 9 of the Act cannot
    primafacie be accepted. Suffice it to say that primafacie exercise of power ·
G   under Section 9 of the Act must be based on well recognized principles
    governing the grant of interim injunctions and other orders of interim
    protection or the appointment of a receiver. [Para 15) (188-F; 189-C, D]

          Firm Ashok Traders .and Anr. v. Gurumukh Das Saluja and Ors., [2004]
    3sec155, held inapplicable.
H
                 ARVIND CONSTRUCTIONS CO. PVT. LTD. v. KALINGA MINING CORPN. (BALASUBRAMANYAN, 1.)   183
                 5. It is seen that in spite of the"'}larties naming their respective                      A
       -
       '   arbitrators in terms of the arbitration agreement, the arbitrators so appointed
           had not been able to nominate a presiding arbitrator. Since counsel on both
           sides agreed that this Court may appoint either a presiding arbitrator or a
           sole arbitrator for the purpose of resolving the disputes between the parties
           from the panel of names furnishfd, the Court appointed the sole arbitrator to
           decide on the disputes between the parties springing out the agreement dated
                                                                                                           B
           14.3.1991 and the Power of Attorney dated 25.3.1991. The arbitrator would
           be free to fix his terms in consultation with the parties.
                                                                     [Para 16) [189-D..C)

                 CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2707 of2007.                              c
                 From the Final Judgment and Order dated 24.1.2007 of the High Court
           of Orissa at Cuttack in ARBA Nos. 8 and 15 of 2006

                Dr. A.M. Singhvi, Jaideep Gupta, Sr. Adv., Ashutosh Kaitan, P.K. Bansal,
           Deepak Khurana, Vishvjit Das, Umesh Kumar Khaitan, Amit Bhandari for the
                                                                                                           D
           Appellant.

                A.K. Ganguly, Surya Prakash Mishra, K.K. Venugopal, Sr. Adv., S. Ravi
           Shankar, Rateesh, Bamali Basak, Visushi Chandana, S. Ravishankar, Yamunah
           Nachiar, S. Ravishankar for the Respondents.
                                                                                                           E
                 The Judgment of the Court was delivered by

                 P.K. BALASUBRAMANYAN,J. 1. Leave granted.

                 2. Mis Kalinga Mining Corporation, a partnership firm bearing registration
           No. 71/1949, came into existence on 10.12.1949. During the years from 1973
                                                                                                           F
       (   to 1980, the firm obtained three mining leases from the State Government. The
           partnership firm was reconstituted in the year 1980, taking in some additional
           partners, again in the year 1991 and yet again in the year 1994.

                  3. On 14.3.1991, the firm entered into an agency agreement with the
           appellant, a private limited company for a term of 10 years. Thereby, the                       G
           appellant was engaged as a raising contractor in respect of the mines for
           which the firm had obtained leases from the State Government. On 25.3.1991,
           the firm executed an irrevocable Power of Attorney in favour of the appellant
....   )
           authorizing it to administer the mines and sell the iron ore extracted therefrom.

                 4. On 13.3.2001, the term of 10 years fixed in the agency agreement                       H
    184                     SUPREME COURT REPORTS                     (2007) 7 S.C.R.

A   expired. New terms were negotiated between the parties and on 22.9.2001, the
    agreement was extended for a period of three years commencing from 14.3.2001.
    The term was to end with 31.3.2003. Again, on 3.9.2003, the term of the                     ~


    agreement was extended for a further period of three years commencing from                  '
    1.4.2003. Thereby, the period was to end with 31.3 .2006.

B          5. The appellant sought a further extension of the term of the agency
    agreement. Apparently, the firm was not willing for an extension. Certain
    disputes thus arose and by letter dated 19.11.2005, the appellant-company
    sought resolution of the said _disputes. The appellant-company followed this
    up by a letter dated 9.12.2005 invoking the arbitration clause in the agency
c   agreement and :1ominating Mr. Sanjeev Jain as its arbitrator in terms of the
    arbitration agreement.

          6. It is seen that the respondent firm, for reasons best known to itself,
    sought for and got a fresh registration on 24.12.2005 and a fmn having the
    same name was again registered and assigned registration No. 595/2005.
D   Prima facie, this was unwarranted and the excuse put forward was that the
    partners, some of whom were partners even originally, could not trace the
    papers relating to the registration of the firm in the year 1949. Be that as it
    may, on receipt of the communication in that behalf from the appellant-
    company nominating an arbitrator, the fmn in its tum named an arbitrator. In
    terms of the arbitration clause, the arbitrators had to name the Presiding
E   Arbitrator. In spite ~f lapse of time, the arbitrators did not meet and nominate
    a Presiding Arbitrator. In that context, the appellant-company filed a petition
    under Section 11 (4)(b) of the Arbitration and Conciliation Act, 1996 (hereinafter
    referred to as, "the Act") requesting the Chief Justice of the High Court of
    Orissa to appoint the third arbitrator on the basis that the firm had failed to
F   act in terms of the procedure agreed to by the parties. The said application
    is said to be pending.

          7. The appellant-company also moved an application under Sec~ion 9 of
    the Act before the District Court, Cuttack seeking interim relief essentially to
    permit it to continue to carry on the mining operations and to restrain the
G   respondent firm from interfering with it. According to the appellant, the
    agreement between the parties was co-terminus with the subsistence of the
    mining lease granted by the State in favour of the respondent firm and since
    the leases continue to .subsist, the appellant-company was entitled to an
    extension of the period of the contract and what remained was only a                 I...   ,._
    negotiation regarding the terms at which the agreement has to be worked by
H
                 ARVIND CONSTRUCTIONS CO. PVT. LTD. v. KALINGA MINlNG CORPN. (BALASUBRAMANYAN, I.]   185

           the appellant-company. The appellant further pleaded that it had made all the                   A
      ?'   investments for the purposes of carrying on the mining operations and had
           brought in the requisite machinery for that purpose. All the necessary
           investments had been made by it and in that situation, the balance of
           convenience was in favour of the grant of an interim order as sought for by
           the appellant. The respondent firm resisted the application, inter alia,
           contending that the agreement between the parties was essentially an agency                     B
           agreement. Such an agreement could not be specifically enforced. On the
           expiry of the term, the appellant-company had no subsisting right or status
           to carry on mining and in that situation the injunction sough! for could not
           be granted. It was also contended that going by Section 14 and Section 41
           of the Specific Relief Act, such a contract is unenforceable. Therefore the                     c
           injunction prayed for could not be granted.

                  8. The District Court, while entertaining the application had made an


-          order on 8.3.2006 directing the parties to maintain the status quo. After
           hearing the parties, the District Court took the view that it would be just and
           appropriate to maintain the order of status quo until the disputes are referred
           to the Arbitral Tribunal and the Tribunal takes seisin of the dispute. Thus,
                                                                                                           D
           the order of status quo originally granted was directed to continue until the
           Arbitral Tribunal was constituted to take up the disputes between the parties.
           Feeling aggrieved, the respondent firm - there is a plea that the appeal was
           filed by the firm of 2005 and not by the firm of 1949 which we shall deal with
           - filed an appeal before the High Court of Orissa. The High Court took the
                                                                                                           E
           view that the District Court was in error in granting an order to maintain the
           status quo sin<;e prima facie the agreement between the parties was not a
           specifically enforceable one in terms of the Specific Relief Act and since the
           term of the agreement had expired it was not appropriate to grant an interim
           order as granted by the District Court. Thus, the High Court reversed the                       F
      (    decision of the District Court and dismissed the appli<;ation filed by the
           appellant-company under Section 9 of the Act.

                  9. Feeling aggrieved by the said decision, the appellant-company has
           filed this appeal. It is contended on its behalf that the appeal filed before the
           High Court was not by the firm bearing registration No. 71/1949 with which                      G
           the appellant-company had the agreement. The arbitration clause, which the
           appellant-company had invoked, was in relation to that agreement and hence
     .)
           the appeal before the High Court, at the instance of the firm bearing registration
.>         No. 59512005; was not maintainable. It was further contended that since the
           agreement relied upon by the appellant in the light of the irrevocable Power
                                                                                                           H
      1~6                    SUPREME COURT REPORTS                    [2007] 7 S.C.R.

  A of Attorney was co-terminus with the mining lease granted to the respondent
      firm by the State Government, the same could not be terminated and would
      not come to an end by efflux of time. The entire approach made by the High
      Court to find otherwise was erroneous. It was further submitted that this was
      a case in which the agreement could be specifically enforced in the light of
      Sections IO and 42 of the Specific Relief Act. It was also faintly suggested
  B   that the powers under Section 9 of the Act were independent of any restrictions
      placed by the Specific Relief Act and viewed in that manner, nothing stood
      in the way of the appellant-company being granted an order of injunction or
      at least an order to maintain status quo until the Arbitral Tribunal decided the
      dispute.
  c        10. On behalf of the respondent firm, it was contended that it was only
    a case of reconstitution of the 1949 firm. It was a mistake to have the firm
     registered again in the year 2005 under a different registration number. Steps
     have been taken to rectify the mistake in that regard. It was further submitted
    that the appeal before the High Court was filed by the firm represented by
. D its partner, who was also a partner in the firm registered in the year 1949. The
    appellant-company had impleaded in its application under Section 9 of the
    Act all those who were presently partners of the firm and there was no grace
    in the contention of the appellant-company that the appeal in the High Court
    was not filed by the firm which was a party to the contract with the appellant.
  E On merits, it was submitted that the agreement was for a specific term, there
    was no irrevocability in the agency agreement and an agreement like the one
    entered into between the parties by way of a raising contract, could not be
    specifically enforced as rightly held by the High Court. It was also pointed
    out that the respondent firm had lost confidence in the appellant-company
    and in such a situation, the appellant-company cannot claim to continue as
  F an agent of the respondent firm since the creation or continuation of an
    agency arrangement depends on the confidence reposed by the principal on
    the agent. It was also pointed out that subsequent to the expiry of the term,
    a tripartite agreement had been entered into with· a labour union and it
    contained a recognition that the period of the contract between the respondent
    firm and the appellant-company had come to an end. It could be seen therefrom
  G that the appellant-company had taken over, directly, the liability in respect of
    the labourers who were being employed by the appellant-company during the
    subsistence of the raising contract. It was also submitted that the respondent .
    firm had started mining operations on its own and the balance of convenience
    was not in favour of grant of any interim order as was done by the District
  H Court. At best, the damages, if any, suffered by the appellant-company was
                 ARVIND CONSTRUCTIONS CO. PVT. LTD.•. KALINGA MINING CORPN. [BALASUBRAMANYAN, I.)   187
.           determinable in terms of money and this was a case in which no injunction                     A,
    °';"'   to perpetuate the agreement could be granted, especially as it involved
            supervision of minute details which the court would not normally undertake.
            It was also pointed out that grant of any injunction in favour of the appellant-
            company would put the respondent firm 'in danger of being exposed to
            prosecutions and other. liabilities under law since it was the mining agency
            under the State Government. It was therefore submitted that the appellant-
                                                                                                          B
            company had no prima facie case for an injunction as sought for.

                   11. The objection that the appeal filed before the High Court was not
            competent need not detain us much. It was the appellant who filed the
            application under Section 9 of the Act impleading the firm and its partners.
            The said firm represented by a partner, who even admittedly was a partner
                                                                                                          c
            of the firm as constituted in the year 1949 and was also a party to the
            agreement with the appellant-company itself, had filed the appeal before the
            High Court. There is no case that the firm registered in the year 1949 had been
            dissolved. On the other hand, we find that it was being reconstituted from
            time to time. Therefore, the fact that, foolishly or otherwise, a firm in the same            D
            name was again registered in the year 2005, does not affect the status of the
            firm with which the appellant-company had a contract and the filing of the
            appeal by that firm represented by its partner. It was brought to our notice
            that the respondent firm had sought a rectification of the register realizing the
            mistake that was made in having the same firm registered all over again, and
            that the said matter is pending. Considering the circumstances, we are of the
                                                                                                          E
            view that the argument that the appeal before the High Court was not
            competent, it not having been filed by the firm with which the appellant-
            company had the contract, is unsustainable. The said contention is therefore
            overruled.
                                                                                                          F
                   12. The effect of the agreement dated 14.3.1991 and the Power of
      ~
            Attorney dated 25.3.1991 admittedly executed between the parties and the
            rights and obligations flowing therefrom are really matters for decision by the
            Arbitral Tribunal. We do not think that it is for us, at this interlocutory stage,
            to consider or decide the validity of the argument raised on behalf of the
            appellant-company that the agreement between the parties was co-terminus G
            with the mining leases and the respondent firm could not terminate the
            agreement so long as the mining leases in its favour continued to be in force.
            Nor do we think it proper to decide the sustainability of the argument on
    >       behalf of the respondent firm that it was mainly an agency agreement for a
            fixed term and on the expiry of the term, no right survives in the appellant-
                                                                                                          H
    188                    SUPREME COURT REPORTS                    (2007) 7 S.C.R.

A company unless of course the respondent firm agreed to an extension of the
    period. We leave that question open for decision by the Arbitral Tribunal.

          13. Primafacie, it is seen that the mining lessee had entered into an
    agreement with the appellant-company for the purpose of raising the iron ore
    from the area covered by the mining lease. The term of the original agreement
B   expired and this was followed by two extensions for three years each.
    Thereafter, the respondent firm had refused to extend the agreement and
    claims that it wants to do the mining itself. Prima facie, it is not possible to
    say that the High Court was wrong in thinking that it may be a case where
    an injunction could not be granted in view of the provisions of the Specific
C   Relief Act. Here again, we do not think that we should pronounce on that
    question since that again will be a question for the arbitrator to pronounce
    upon. Suffice it to say that the position is not clear enough for us to assume
    for the purpose of this interlocutory proceeding that the appellant is entitled
    to specifically enforce the agreement dated 14.3.1991 read in the light of the
    Power of Attorney dated 25.3.1991. Of course, this aspect will be again
D   subject to the contention raised by the appellant-company that the agreement
    created in his favour was co-terminus with the mining lease itself. But, as we
    have stated, these are the aspects to be considered by the Arbitral Tribunal.
    We refrain from pronouncing on them at this stage.

           14. We think that adequate grounds are not made out by the appellant
E   at this interlocutory stage for interfering with the order of the High Court. In
    that view alone, we consider it proper to decline to interfere with the order
    of the High Court and leave the parties to have their disputes resolved in
    terms .of the arbitration agreement between the parties.

F          15. The argument that the power under Section 9 of the Act is
    independent of the Specific Relief Act or that the restrictions placed by the
    Specific Relief Act cannot control the exercise of power under Section 9 of
    the Act cannot prima facie be accepted. The reliance placed on Firm Ashok
    Traders & Anr. v. Gurumukh Das Saluja & Ors., (2004] 3 S.C.C. 155 in that
    behalf does not also help much, since this Court in that case did not answer
G   that question fmally but prima facie felt that the objection based on Section
    69 (3) of the Partnership Act may not stand in the way of a party to an
    arbitration agreement moving the court under Section 9 of the Act. The power
    under Section 9 is conferred on the District Court. No special procedure is
    prescribed by the Act in that behalf. It is also clarified that the Court
H   entertaining an application under Section 9 of the Act shall have the same
                    ARVIND CONSTRUCTIONS CO. PVT. LID. v. KALINGA MINING CORPN. [BALASUBRAMANYAN, J.)   }   89

       .,..   power for making orders as it has for the purpose and in relation to any A
              proceedings before it. Prima facie, it appears that the general rules that
              governed the court while considering the grant of an interim injunction at the
              threshold are attracted even while dealing with an application under Section
              9 of the Act. There is also the principle that when a power is conferred under
              a special statute and it is conferred on an ordinary court of the land, without
              laying down any special condition for exercise of that power, the general rules B
              of procedure of that court would apply. The Act does not prim a facie purport
              to keep out the provisions of the Specific Relief Act from consideration. No
              doubt, a view that exercise of power under Section 9 of the Act is not
              controlled by the Specific Relief Act has been taken by the Madhya Pradesh
              High Court. The power under Section 9 of the Act is not controlled by Order                        c
              XVIII Rule 5 of the Code of Civil Procedure is a view taken by the High Court
              of Bombay. But, how far these decisions are correct, requires to be considered
              in an appropriate case. Suffice it to say that on the basis of the submissions
              made in this case, we are not inclined to answer that question finally. But, we
              may indicate that we are prima facie inclined to the view that exercise of
              power under Section 9 of the Act must be based on well recognized principles D
              governing the grant of interim injunctions and other orders of interim protection
              or the appointment of a receiver.

                      16. It is seen that in spite of the parties naming their respective
               arbitrators, in tenns of the arbitration agreement, more than one year back, the
               arbitrators so appointed had not been able to nominate a Presiding Arbitrator                     E
               in tenns of the arbitration agreement. We therefore put it-to counsel on both
               sides as to why we shall not constitute an Arbitral Tribunal in view of their
               failure to constitute the Arbitral Tribunal in tenns of the arbitration agreement
              and in view of the urgency involved in resolving the disputes between the
       (
              parties. Counsel on both sides agreed that this Court may appoint either a                         F
              Presiding Arbitrator or a sole arbitrator for the purpose of resolving the
 '..          disputes between the parties. A panel of names was furnished. Having
              considered the names shown therein and taking note of the submissions at
              the bar, we think that it would be appropriate and just to both the parties to
              appoint Mr. Justice Y.K. Sabharwal, fonner Chief Justice oflndia as the sole
              arbitrator for deciding all the disputes between the parties. We therefore
                                                                                                 G
              appoint Mr. Justice Y.K. Sabharwal, fonner Chief Justice of India as the sole
              arbitrator to decide on the disputes between the parties springing out the
...    )
              agreement dated 14.3.1991 and the Power of Attorney dated 25.3.1991. The
              arbitrator would be free to fix his tenns in consultation with the parties. We
              would request the arbitrator to expeditiously decide the dispute on entering H
    190                    SUPREME COURT REPORTS                      [2007] 7 S.C.R.

A   upon the reference and to give his award'-as early as possible.

           17. In the result, we decline to interfere with the order of the High Court
    and dismiss this appeal. While doing so, we revoke the nomination made by
    the parties of two arbitrators; We appoint Mr. Justice Y.K. Sabharwal, fonner
    Chief Justice of India as the sole arbitrator to decide the dispute between the
B   parties. The parties are directed to suffer their respective costs.

    RP.                                                           Appeal dismissed.
                                                                                         l




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