2004(1) ALL MR 832
IN THE HIGH COURT OF JUDICATURE AT BOMBAY

R.M. LODHA AND A.V. MOHTA, JJ.

National Shipping Company Of Saudi Arabia Vs. Sentrans Industries Ltd.

Appeal No. 852 of 2003,Arbitration Petition No.212 of 2002

12th January, 2004

Petitioner Counsel: Mr. V. K. RAMBHADRAN,Mr. ALDRIN D'SOUZA
Respondent Counsel: Dr. VIRENDRA V. TULZAPURKAR,Mr. P. A. KABADI,Ms. MEENAKSHI IYER

Arbitration and Conciliation Act (1996) S.9(ii)(b) - Order under - Is in the nature of interim protection order - In exercise of this power provisions of O.38, R.5 of CPC cannot be imported.

Section 9 in the Act of 1996 is a substantive provision which empowers the court to pass an interim order before or during arbitral proceedings or any time after the making of the arbitral award but before it is executed under section 36. Section 9(ii)(b), provides for an interim measure of protection for securing the amount in dispute in the arbitration. Sort of clarification it also provides that the court shall have the same power for making orders as it has for the purpose of and in relation to any proceeding before it. Such provision as enacted in Section 9 is a provision that enables a party to apply for interim protection if action of the other party to the agreement providing for arbitration is either in breach of the terms of the agreement or is inequitable, unfair or in breach of natural justice. The order under section 9(ii)(b) is in the nature of interim protection order. In a special provision of the nature like section 9(ii)(b), exercise of power cannot be restricted by importing the provisions of Order 38 rule 5 of the Code of Civil Procedure as it is. The obstructive conduct of the opposite party may be one of the relevant considerations for the court to consider the application under section 9(ii)(b). The party seeking protection order under Section 9(ii)(b) ordinarily must place some material before the Court, besides the merits of the claim that order under section 9(ii)(b) is eminently needed to be passed as there is likelihood or an attempt to defeat the award, though as indicated above, the provisions of Order 38, Rule 5 C.P.C. are not required to be satisfied. The statutory discretion given to the Court under Section 9(ii)(b) must be exercised judicially in accordance with established legal principles and having regard only to relevant considerations. [Para 10]

Cases Cited:
M/s. Global Company Vs. M/s. National Fertilizers Ltd., AIR 1998 Delhi 397 [Para 6]
Pushpa P. Mulchandani (Mrs.) Vs. Admiral Radhakrishin Tahilani (Retd.), 2001(1) ALL MR 396=2001(1) Bom.C.R. 592 [Para 7]
Delta Construction Systems Ltd., Hyderabad Vs. Narmada Cement Company Ltd., 2002 (Supp.) Bom.C.R. 318 [Para 8]
ITI Ltd. Vs. Siemens Public Communications Network Ltd., (2002)5 SCC 510 [Para 9]


JUDGMENT

R. M. LODHA, J. :- This appeal raises an issue of some importance. The issue is whether the power exercisable under section 9(ii)(d) of the Arbitration and Conciliation Act, 1996 by the Court in a matter seeking security in respect of the amount in dispute in the arbitration is restricted by the conditions of attachment before judgment as prescribed under Order 38, Rule 5, C.P.C. In other words, the question is, is it necessary for the party seeking interim measure from the court for security of the amount in dispute in the arbitration by the Court during the arbitral proceedings to satisfy the conditions of attachment before judgment under Order 38, Rule 5, C.P.C.

2. The aforesaid issue in its stark form has to be considered in the light of the provisions contained in the Arbitration and Conciliation Act, 1996 (for short "Act of 1996") and the powers of the Court.

3. The Act of 1996 which came into force on 22nd August, 1996 was enacted to consolidate and amend the law relating to domestic arbitration, international commercial arbitration and enforcement of foreign arbitral awards inter alia to define the law relating to conciliation of the matters connected therewith or incidental thereto. Section 2(e) defines the Court which means the principal Civil Court of original jurisdiction in a district and includes the High Court in exercise of its ordinary original civil jurisdiction, having jurisdiction to decide the questions forming the subject matter of the arbitration if the same had been the subject matter of a suit but does not include any civil court of a grade inferior to such principal Civil Court or any court of Small Causes. A 'party' under section 2(h) means a party to an arbitration agreement. Section 9 empowers the court to order interim measures before or during arbitral proceedings or any time after the making of the arbitral award but before it is enforced in accordance with section 36. Section 9 of the Act of 1996 reads thus -

"9. Interim measures, etc. by Court. - A party may, before or during arbitral proceedings or at any time after the making of the arbitral award but before it is enforced in accordance with section 36, apply to a court -

(i) for the appointment of a guardian for a minor or a person of unsound mind for the purposes of arbitral proceedings ; or

(ii) for an interim measure of protection in respect of any of the following matters, namely :-

(a) the preservation, interim custody or sale of any goods which are the subject-matter of the arbitration agreement;

(b) securing the amount in dispute in the arbitration;

(c) the detention, preservation or inspection of any property or thing which is the subject-matter of the dispute in arbitration, or as to which any question may arise therein and authorising for any of the aforesaid purposes any person to enter upon any land or building in the possession of any party, or authorising any samples to be taken or any observation to be made, or experiment to be tried,which may be necessary or expedient for the purpose of obtaining full information or evidence;

(d) interim injunction or the appointment of a receiver;

(e) such other interim measure of protection as may appear to the court to be just and convenient,

and the Court shall have the same power for making orders as it has for the purpose of, and in relation to, any proceedings before it."

4. The Act of 1996 is materially different from the Arbitration Act, 1940 which has been repealed by section 85 of the Act of 1996. Section 41 of the Arbitration Act, 1940 provided for procedure and powers of the court. Code of Civil Procedure was made applicable to all proceedings before the court under Section 41 of the Act of 1940. Section 41 of the Arbitration Act, 1940 reads thus -

"41. PROCEDURE AND POWERS OF COURT.- Subject to the provisions of this Act and of rules made thereunder :

(a) the provisions of the Code of Civil Procedure, 1908 (5 of 1908), shall apply to all proceedings before the Court, and to all appeals, under this Act, and

(b) the Court shall have, for the purpose of, and in relation to arbitration proceedings, the same power of making orders in respect of any of the matters set out in the Second Schedule as it has for the purpose of, and in relation to any proceedings before the Court :

Provided that nothing in Cl.(b) shall be taken to prejudice any power which may be vested in an arbitrator or umpire for making orders with respect to any of such matters."

5. The provision like section 41 of the Arbitration Act, 1940 is not available in the Act of 1996. There is no specific provision in the Act of 1996 making provisions of the Code of Civil Procedure applicable to the proceedings before the Court. Having noticed the aforesaid statutory provisions, we shall survey few decisions cited at bar.

6. The Single Judge of Delhi High Court in M/s. Global Company Vs. M/s. National Fertilizers Ltd., AIR 1998 Delhi 397 while considering the application for interim measures under section 9(ii) (b) of the Act of 1996 in paragraph 11 of the report held thus -

"11. It is true that the said Arbitration Act, 1940 stands repealed by the Act of 1996 and the provisions contained in the Code of Civil Procedure are not applicable to the proceedings under the Act, still, in my opinion, in the absence of guidelines how the power for grant of relief under Section 9(ii)(b) is to be exercised by the Court, the principles underlying the aforesaid sections are to be applied. It is only on adequate material being supplied by the petitioner that the Court can form opinion that unless the jurisdiction is exercised under the said Section 9(ii) there is real danger of the respondent defeating, delaying or obstructing the execution of the award made against it. On the basis of the only ground of protection of financial interest of the petitioner taken in para No.6 of the petition, the respondent, a Govt. of India Undertaking cannot be legally directed to furnish security for the amount of US$ 88.250 together with interest @ 9% p.a. Petition thus deserves to be dismissed."

7. In Pushpa P. Mulchandani (Mrs.) & ors. Vs. Admiral Radhakrishin Tahilani (Retd.) and ors., 2001(1) Bom.C.R. 592 : [2001(1) ALL MR 396], the learned Single Judge of this court held that the provision contained in section 9 of the Act of 1996 was a self operative code and that the provisions of Civil Procedure Code are not applicable while considering the application under section 9 of the Act of 1996. The learned Single Judge held thus -

"19. A significant fact which strikes one is that there is no section in the 1996 Act corresponding to section 41 of the 1940 Act. The intention of the 1996 Act appears to be to steer clear of the earlier position, namely, that the provisions of the Code of Civil Procedure, 1908 would apply to all proceedings under the Arbitration Act subject to the provisions of the Act and Rules made thereunder. On the contrary, there is internal evidence in the 1996 Act which tends to suggest that the intention is to make it a self-contained Code. Reference may be made to section 9 of the 1996 Act. Section 9 deals with the power of the Court to make interim measures for (i) appointment of a guardian pendente lite for a minor or a person of unsound mind, (ii)the preservation, interim custody or sale of any goods which are the subject-matter of the arbitration agreement, (iii) securing the amounts in dispute in the arbitration, (iv) the detention, preservation or inspection of any property or thing which is the subject-matter of the dispute in arbitration, or authorising for any of the said purposes any person to enter upon any land or building in the possession of any party, or authorising any samples to be taken or any observation to be made, or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full information or evidence, (v) issuing interim injunction, (vi) appointment of a Receiver ; (vii) such other interim measure of protection as may appear to the Court to be just and convenient. In my view, these provisions in section 9 indicate an intention on the part of the Legislature to make the 1996 Act a self-contained self-operative Code with regard to the subject matter of arbitration and conciliation. If the intention was to apply the provisions of the Code of Civil Procedure to arbitration under the 1996 Act, then there was no reason for the Legislature to specially enact section 9 in the 1996 Act dealing with the interim measures for all the said powers would have been available in the different orders in the schedule to the Civil Procedure Code. I am thus fortified in my opinion that the 1996 Act is enacted to make the law a self-contained Code and that the provisions of the Civil Procedure Code are not applicable, unless specifically made applicable."

8. In Delta Construction Systems Ltd., Hyderabad Vs. Narmada Cement Company Ltd., 2002 (Supp.) Bom.C.R. 318, in dealing with the question whether procedural provisions of Civil Procedure Code were applicable while considering the application for interim relief under section 9, the learned Single Judge of this court held that substantive provision of Civil Procedure Code for granting interim relief would not be applicable while dealing an application under section 9(ii) of the Act of 1996 though procedural provisions not provided in the Act of 1996 or in rules framed thereunder which are not inconsistent and are necessary for effective disposal of proceedings would be applicable. The learned Judge held thus -

"The power of the Court to secure the amount in dispute under arbitration is not hedged by the predicates as set out in Order 38. All that the Court must be satisfied is that an interim measure is required. In other words, the party coming to the Court must show that if it is not secured, the Award which it may obtain would result in a paper decree or a decree which cannot be enforced on account of acts of a party pending arbitral process. Therefore, the Court would not to be bound by the requirement of Order 38, Rule 5. Since the power is discretionary, the Court must be satisfied that it is in the interest of justice, based on the material before it to pass order to secure the petitioner before it. The discretion to be exercised would be based as set out earlier on the material before it and the petitioner making out a case that there is need for an interim measure of protection. However, once the Court passes the order, then the order to secure would be as per the procedure as laid down in the Code of Civil Procedure. Insofar as preservation, interim custody etc. is concerned, the power as conferred under Order 39, Rule 7 is also provided by section 9(ii)(c). Appointment of Receiver is covered by 9(ii)(d). Power to sell goods at interim stage is specifically provided for in section 9(ii)(a). Apart from that there is general power reserved in the courts for such interim measure as it may thought proper under section 9(ii)(a). The substantive provisions of granting interim relief as provided for in the Code of Civil Procedure therefore, cannot be read into section 9. There are independent provisions in the Act itself. The exercise of the power must be construed, bearing in mind the object of the Act and the need to dispose of the matter as expeditiously and not hedged in, by the provisions of the Code of Civil Procedure. To my mind, therefore, it is not necessary for the Court when called upon to secure the amount in dispute to find out whether the respondent before it is seeking to dispose of the property or taking the property outside the jurisdiction of the Court. The Court is not hedged by such restriction. If it were to be so, the legislature considering that the petition lies to the Civil Court could have provided that Court can exercise all the powers it has under the Civil Procedure Code for granting interim relief. On the contrary only procedural provisions to give effect to the power under section 9 have been conferred. Considering that, to my mind, the observation of the learned Judge of the Delhi High Court in M/s. Global (supra) when it noted that the principles of the Code of Civil Procedure will have to be borne in mind would only restrict the exercise of powers under section 9. The power under section 9 cannot be fettered by reading into it the requirements for granting interim reliefs which are not provided. To that extent, I am unable to agree with the view expressed by the Delhi High Court."

The view of the learned Single Judge of Delhi High Court in M/s. Global Company (supra) did not favour with the learned Single Judge of this court in Delta Construction.

9. The Supreme Court in ITI Ltd. Vs. Siemens Public Communications Network Ltd., (2002)5 SCC 510 was seized with the question whether the revision petition under section 115 of Civil Procedure Code lies to the High Court against an order made by Civil Court in an appeal under section 37 of the Act of 1996. In paragraphs 10 and 11 of the report, the Supreme Court observed thus -

"10. We do not agree with this submission of the learned counsel. It is true in the present Act application of the Code is not specifically provided for but what is to be noted is : is there an express prohibition against the application of the Code to a proceedings arising out of the Act before a civil court? We find no such specific exclusion of the Code in the present Act. When there is no express exclusion, we cannot by inference hold that the Code is not applicable.

11. It has been held by this Court in more than one cause that the jurisdiction of the civil court to which a right to decide a lis between the parties has been conferred can only be taken by a statute in specific terms and such exclusion of right cannot be easily inferred because there is always a strong presumption that the civil courts have the jurisdiction to decide all questions of civil nature, therefore, if at all there has to be an inference the same should be in favour of the jurisdiction of the court rather than the exclusion of such jurisdiction and there being no such exclusion of the Code in specific terms except to the extent stated in Section 37(2), we cannot draw an inference that merely because the Act has not provided CPC to be applicable, by inference it should be held that the Code is inapplicable. This general principle apart, this issue is now settled by the judgment of a three Judge Bench of this Court in the case of Bhatia International Vs. Bulk Trading S.A. wherein while dealing with a similar argument arising out of the present Act, this Court held : (SCC p.116, para 15)

"While examining a particular provision of a statute to find out whether the jurisdiction of court is ousted or not, the principle of universal application is that ordinarily the jurisdiction may not be ousted unless the very statutory provision explicitly indicates or even by inferential conclusion the court arrives at the same when such a conclusion is the only conclusion."

The Supreme Court, thus, in ITI Ltd. held that there was no specific exclusion of the Code of Civil Procedure in the Act of 1996 and therefore, it cannot be inferred that the Code of Civil Procedure was not applicable.

10. Section 9 in the Act of 1996 is a substantive provision which empowers the court to pass an interim order before or during arbitral proceedings or any time after the making of the arbitral award but before it is executed under section 36. Since we are concerned with section 9(ii)(b), it may be noticed that it provides for an interim measure of protection for securing the amount in dispute in the arbitration. Sort of clarification it also provides that the court shall have the same power for making orders as it has for the purpose of and in relation to any proceeding before it. Such provision as enacted in Section 9 is a provision that enables a party to apply for interim protection if action of the other party to the agreement providing for arbitration is either in breach of the terms of the agreement or is inequitable, unfair or in breach of natural justice. The order under section 9(ii)(b) is in the nature of interim protection order. In a special provision of the nature like section 9(ii)(b), we are afraid, exercise of power cannot be restricted by importing the provisions of Order 38, Rule 5 of the Code of Civil Procedure as it is. The legislature while enacting section 9(ii)(b) does not seem to us to have intended to read into it the provisions of Order 38, Rule 5 of the Civil Procedure Code as it is. It is true and as have been held by the Supreme Court in ITI Ltd. that for want of specific exclusion of the Code of Civil Procedure in the Act of 1996, it cannot be inferred that the Code was not applicable but that would not mean that provisions of Code have to be read into as it is when the Court exercises its powers as prescribed in the Act of 1996. The procedural aspects provided in the Code about which the Act of 1996 is silent, needless to say, when the court exercises its substantive power under the Act of 1996 shall be applicable but the guiding factor for exercise of power by the Court under section 9(ii)(b) has to be whether such order deserves to be passed for doing justice to the cause. The provisions of Order 38, Rule 5, C.P.C. cannot be read into the said provision as it is nor can power of the court in passing an order of interim measure under section 9(ii)(b) be made subject to the stringent provision of Order 38, Rule 5. The power of the court in passing the protection order to secure the amount in dispute in the arbitration before or during arbitral proceedings or at any time of making of the arbitral amount but before it is enforced cannot be restricted by importing the provisions set out in Order 38 of C.P.C. but has to be exercised ex debito justitiae and in the interest of justice. The court while considering the application for interim protection under section 9(ii)(b) is guided by equitable consideration and each case has to be considered in the light of its facts and circumstances. The interim protection order contemplated under section 9(ii)(b) is granted by the court to protect the interest of the party seeking such order until the rights are finally adjudicated by the arbitral tribunal and to ensure that the award passed by arbitral tribunal is capable of enforcement. Though the power given to the court under section 9(ii)(b) is very wide and is not in any way controlled by the provisions of the Code but such exercise of power, obviously, has to be guided by the paramount consideration that the party having a claim adjudicated in its favour ultimately by the Arbitrator is in a position to get the fruits of such adjudication and in executing the award. While dealing with the application for direction to the other party to deposit the security of the amount in dispute in the arbitration, the court also has to keep in mind the drastic nature of such order and unless a clear case not only on the merits of the claim is made out but also the aspect that denial of such order would result in grave injustice to the party seeking such protection order in as much as in the absence of such order, the applicant party succeeding before the arbitral tribunal may not be able to execute the award. The obstructive conduct of the opposite party may be one of the relevant considerations for the court to consider the application under section 9(ii)(b). The party seeking protection order under Section 9(ii)(b) ordinarily must place some material before the Court, besides the merits of the claim that order under section 9(ii)(b) is eminently needed to be passed as there is likelihood or an attempt to defeat the award, though as indicated above, the provisions of Order 38, Rule 5 C.P.C. are not required to be satisfied. The statutory discretion given to the Court under Section 9(ii)(b) must be exercised judicially in accordance with established legal principles and having regard only to relevant considerations. In our view, this is the proper approach for consideration of the application for interim relief under section 9(ii)(b) and we hold that the provisions of Order 38, Rule 5 of the Civil Procedure Code cannot be read as it is and imported in section 9 of the Act of 1996. We also hold without hesitation that the court is competent to pass an appropriate protection order of interim measure as provided under section 9(ii)(b) outside the provisions of Order 38, Rule 5 of the Code of Civil Procedure. Each case under section 9(ii)(b) of the Act of 1996 has to be considered in its own facts and circumstances and on the principles of equity, fair play and good conscience. The power of the court under section 9(ii)(b) cannot be restricted to the power conferred on the court under Civil Procedure Code though analogous principles may be kept in mind.

11. In the backdrop of the aforesaid legal position, let us turn to the controversy involved in the present appeal. The appeal is restricted to prayer (d) of arbitration petition filed by the appellant under section 9 of the Act of 1996. By prayer (d) the appellant sought an order directing the respondent to deposit in this court a sum of US $ 20,63,747 in order to secure the claim of the petitioner in the arbitration proceedings. Under the agency agreement dated 6th December, 1998, the relationship of principal and agent came into existence between the appellant and the respondent. The present appellant appointed the respondent as its exclusive agent in and for the ports on the West Coast of India from Kandla to the North Cochin to perform such fiduciary duties as an agent within the territory and as designated by the appellant. The appellant provided the respondent to accounting instructions. It is the appellant's case that clause 2.8.1 of the agency agreement set out in details the accounting and financial reporting obligations imposed on the respondent in its capacity as appellant's agent. The grievance of the appellant is that there are breaches of obligations by the respondent under the agency agreement dated 6th December, 1998 to account to the appellant in respect of freight and other charges collected from shippers and pay the same over to the appellant. These breaches by the respondent, according to the appellant, amounted to dishonest acts in fiduciary capacity. Specifically, the security is sought to be deposited from the respondent in the sum of Rs.1,75,56,374/- which is said to have been received by the respondent from the shippers under the agency agreement towards the freight charges but not deposited in the account. We may observe that in the petition the specific details are not given but in paragraph 38 of the rejoinder, the averment is thus-

"38. With reference to para 24, I say that the accounts submitted by the Respondents along with their letter dated 5th April, 2002 itself would make it clear that the Respondents continued to show that the freight from Jindal Strips and Zenith were outstanding when in fact they had collected the same in the year 2001 itself. I say that Zenith Ltd., in response to my fax dated 3rd April, 2002, by their reply dated 9th April, 2002 have confirmed that sum of Rs.69,52,234/- have been paid between 9th December, 2001 and 8th January, 2002 to the Respondents. Hereto annexed and marked as Exhibit-20 and Exhibit-21 are the fax dated 3rd April, 2002 addressed by me to Zenith and their reply dated 9th April, 2002. Similarly the Respondents have received freight in the sum of Rs.55,58,345/- from Jindal Strips Ltd., prior to 31st December, 2001. A third shipper viz. Indian Seamless Metal Tubes Ltd. have confirmed having paid sum of Rs.9,37,605/- to the Respondents. Hereto annexed and marked as Exhibit-22 is copy of the Debit Invoice dated 8th October, 2001 raised by Sentrans Maritime. The fourth Shipper viz. Bharat Forge Limited have confirmed having paid the entire outstanding in the sum of US $ 65,580 which at the rate of 1 US Dollar = R.48.00 works out to Rs.3,47,840/-. Hereto annexed and marked as Exhibit-23 is fax dated 3rd April, 2002 addressed to Bharat Forge Limited in which they have confirmed having made all payments. The fifth shipper viz., IAL Shipping Agencies (Kandla) Pvt. Ltd. have confirmed having paid sum of Rs.8,93,425/-. A copy of the same is annexed and marked as Exhibit-24. The sixth shipper viz. Oyster Shipping Agency Pvt. Ltd. have confirmed having paid sum of Rs.66,925/-. Thus based on the aforesaid documents it is evident that the Respondents had collected sum of Rs.1,75,56,374/- in aggregate from the shippers and continued to show the same as outstanding as late as 5th April, 2002."

12. The learned counsel for the appellant strenuously contended that the documents received from the shippers as referred to in paragraph 38 of the rejoinder clearly establish that the respondent as agent has received and collected freight in the sum of Rs.1,75,56,374/- but had in breach of the fiduciary duty as agent retained the same and not deposited/paid over to the appellant. The learned counsel contended that the respondent had actually received the aforesaid sum representing freight paid to them as agent of the respondent and in the fiduciary capacity which they can not be allowed to retain and utilise the same. He submitted that the learned Judge erred in holding that an order for deposit could not be made as the case under Order 38 of C.P.C. was not made out. He submitted that the learned Judge ought to have directed the respondent to deposit the said amount as respondent could not be allowed to retain, utilise or deal with the amount of freight in any manner whatsoever. He urged that in a case like this where the amount in trust is wrongfully retained by the respondent, the learned Judge ought to have passed interim order under section 9(ii)(b).

13. Mr. Virendra Tulzapurkar, the learned senior counsel appearing for the respondent vehemently opposed the submissions of the learned counsel for the appellant. The learned senior counsel contended that the factual position about the recovery of amount by the respondent by way of freight allegedly not paid over to the appellant is seriously disputed. He submitted that the relationship between the appellant and the respondent is of principal and agent and there are claims and counter-claims made by one against the other. According to the learned senior counsel till final position as to who is the debtor and who is the creditor is ascertained, neither party can lay claim on any item of money which is a part of the general accounts which would be ascertained by the arbitral tribunal. He contended that the appellants have not been able to show that the amount in respect of which security is sought, is available in specie in any bank account. The learned senior counsel, thus, contended that no case for deposit of security is made out.

14. We reflected over the matter thoughtfully and in our considered view the learned Single Judge was not right in holding that since the case under Order 38, Rule 5, C.P.C. has not been made out, the order directing the respondent to deposit the amount in dispute in arbitration cannot be granted but on facts, we are satisfied that no case is made out for direction to the respondent to deposit the security in the sum of Rs.1,75,56,374/-. The respondent has denied the incorrectness of the accounts rendered by them. The respondent has also denied that the amount of freight received by them from various parties has not been accounted for. The appellant has sought to discard the stand of the respondents by producing before the court some documents received from shippers to indicate that the amount of freight was paid by such shippers to the respondent and the amount so received by the respondent in the fiduciary capacity as agent has not been accounted for. We are afraid, it will be too much for the Court in exercise of power under section 9(ii)(b) to sift and appreciate the letters and the documents placed on record by the appellant to show that from six shippers as set out in para 38 of the affidavit in rejoinder, the amount of Rs.1,75,56,347/- was collected by the respondent. It is not in dispute that the matter is subjudice before the arbitral tribunal. The appellant has claimed right and/or damages for a sum in excess of US $ 2.8 million (plus interest and cost) and for declaration that the respondent has breached its obligations under the agency agreement dated 6th December, 1998 to account to the appellant in respect of freight and other charges including the dishonest obtaining and/or retention of the monies payable to the appellant. The claim of the appellant is contested by the respondent before the arbitral tribunal and they have set up the counter-claim. The evidentiary value of the documents sought to be relied upon by the appellant in support of their application for security deposit in the sum of Rs.1,75,56,374/- shall be examined by the arbitral tribunal. In our considered view it would not be appropriate on our part to record any specific finding even prima facie with regard to the amount of Rs.1,75,56,374/- allegedly received by the respondent from six shippers as contended in para 38 of the affidavit in rejoinder on the basis of the documents relied upon by the appellant when the correctness, worth or otherwise of the said documents would be considered by the arbitral tribunal. Incidently we may observe that no material has been placed by the appellant to indicate even remotely that respondent by its acts is intending to defeat the claim of the appellant and if no interim protection order is passed by the Court, in the event of appellant succeeding before arbitral tribunal, it would not be possible for the appellant to derive fruits of the award. We are afraid, in a case like this, when the claim of the appellant is based under section 218 of the Indian Contract Act and there is counter claim by the respondent in the facts and circumstances of the case, it does not seem to us in the interest of justice to direct the respondent to deposit the amount of Rs.1,75,56,374/-. No circumstance justifying such order has been established by the appellant. Taking overall facts and circumstances of the case, we are satisfied that the appellant has failed to make out a case for direction to respondent to deposit the security in the sum of Rs.1,75,56,374/- as in our view, no case for such protection by way of interim order under section 9(ii)(b) has been made out.

We, accordingly, dismiss the appeal with no order as to costs.

The parties may be provided ordinary copy of this order duly authenticated by the Court Associate on payment of usual copying charges.

Appeal dismissed.