विदेशी मध्यस्थ न्यायाधिकरण के अंतरिम आदेश की प्रवर्तन शक्ति भारत में सीमित: बॉम्बे हाई कोर्ट

Foreign Arbitral Tribunal Interim Relief May Fail In India Without Direct Enforcement: Bombay High Court

Shivani PS

23 Sept 2026 2:13 PM IST

On Tuesday, 22 September, the Bombay High Court held that interim relief granted by a foreign arbitral tribunal may be rendered ineffective in India where there is no direct mechanism to enforce such an order.

A Division Bench of Justices A.S. Gadkari and Kamal Khata allowed an appeal by Singapore-based Sunfield Global Pte Limited against Liberty Investments Private Limited, set aside a Single Judge's order refusing interim protection and directed Liberty to secure Sunfield's admitted USD 66,92,500 claim. The judges observed:

“There is a high likelihood of such interim measures or protection being rendered otiose by the time this process is completed, rendering it ineffective altogether. This would involve three distinct rounds of litigation, which would be a cumbersome and wholly inefficacious as compared to approaching this Court in a Section 9 Petition.”

Sunfield provides supply-chain services across the Asia-Pacific region, including procurement, trading and logistics, while Mumbai-based Liberty trades in vegetable and seed oils.

The dispute arose from six contracts executed between 1 October 2024 and 19 February 2025, under which Liberty procured 11,500 metric tonnes of oil. Sunfield claimed that USD 66,92,500 remained unpaid as on 3 October 2025, despite Liberty admitting the outstanding amount in writing.

It then approached the High Court under Section 9 of the Arbitration and Conciliation Act, 1996, seeking either a direction to deposit the admitted amount or an order restraining Liberty from selling, transferring or creating third-party rights over its land and buildings in Mumbai.

While the petition was pending, a three-member arbitral tribunal was constituted on 17 November 2025 under the Federation of Oils, Seeds and Fats Associations (FOSFA) Rules of Arbitration and Appeal, 2020.

The Single Judge dismissed the petition on 8 January 2026. Sunfield then appealed under Section 37 of the Arbitration Act. It argued that neither the FOSFA Rules nor Section 38 of the English Arbitration Act provided an effective remedy to secure its monetary claim against Liberty's Indian property.

Liberty, on the other hand, argued that the constitution of the foreign tribunal attracted the bar under Section 9(3) and that Sunfield had failed to establish that the foreign remedy was ineffective.

The Division Bench rejected Liberty's objection, noting that Sunfield had approached the High Court under Section 9 before the foreign tribunal was constituted, seeking to secure its admitted claim against Liberty's only known Indian asset, the Mumbai property. It held that Sunfield could not lose the protection merely because the tribunal was subsequently constituted, particularly when the delay was attributable to the Court. It remarked:

“It was the Court's failure not that of the Appellant. Can the Appellant be denied relief because subsequently the Arbitral Tribunal was constituted?”

The Bench also rejected Liberty's reliance on Section 38 of the English Arbitration Act, holding that the provision concerned property forming the subject matter of arbitration, unlike the separate Mumbai property against which Sunfield sought security.

It observed that “the relief sought by the appellant and the relief contemplated under Section 38 of the EAA are completely separate and distinct.” It then examined whether the foreign arbitration provided an effective remedy to protect Sunfield's claim and posed what it described as a “fundamental question”:

“How, then, does it secure payment from a Respondent based in India who has undisputedly reneged its contract.”

Relying on Norvic Shipping Asia PTE Ltd. v. Zigma International, the judges reiterated that the bar on court intervention after constitution of an arbitral tribunal is not absolute where the alternative remedy is ineffective. They found the foreign remedy ineffective in the present case, noting that Section 13 of the Code of Civil Procedure provides for the conclusiveness and enforcement of final foreign judgments but does not provide a mechanism for directly enforcing an interim order passed by a foreign tribunal. The Court observed:

“Section 13 of the Code of Civil Procedure contemplates that a foreign judgement is conclusive and executable in Indian Court after it attains finality. There is no provision for executing an interim order.”

The Bench also held that Sunfield would have to obtain interim relief from the tribunal, secure a foreign court decree and then seek its enforcement in India. It found that these three rounds of litigation could defeat the purpose of the interim protection and justified recourse to Section 9.

Accordingly, the High Court allowed Sunfield's appeal and set aside the Single Judge's order. It directed Liberty to secure Sunfield's admitted claim of USD 66,92,500, along with interest and costs. If Liberty failed to do so, it restrained it from creating third-party rights over or alienating its Mumbai property during the arbitration.

Appearances for appellant (Sunfield Global Pte Limited): Senior Advocate Virag Tulzapurkar, with Advocates Mutahhar Khan, Atul S. Mathur, Jyoti Sinha, Priya Singh and Apoorv Karekar, instructed by Khaitan & Co.

Appearances for respondent (Liberty Investments Private Limited): Senior Advocate Ashish Kamat, with Advocates Harsh Moorjani, Jay Zaveri, Kshamaya Daniel, Ujwal Batra and Suraj Agarwal, instructed by Crawford Bayley.

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