Case Note & Summary
The petitioner, Oil and Natural Gas Corporation Limited (ONGC), filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996, seeking continuation and extension of a bank guarantee furnished by the respondent, Swiber Offshore Construction Pte. Limited (Swiber), pending adjudication of ONGC's challenge to the arbitral award dated 30 September 2025. The dispute arose from a commercial contract between the parties, and the arbitral tribunal had passed an award. ONGC challenged the award under Section 34 of the Act. During the pendency of the challenge, the bank guarantee was due to expire. ONGC sought interim relief to prevent the guarantee from lapsing, arguing that without such protection, the award would become unenforceable. The respondent opposed, contending that Section 9 could not be invoked post-award. The court analyzed the scope of Section 9 and held that it applies even after the award is passed, as long as the proceedings are pending. The court noted that the purpose of Section 9 is to preserve the subject matter of the arbitration and ensure effective enforcement of the award. Accordingly, the court allowed the petition and directed the respondent to extend the bank guarantee until the disposal of the challenge petition. The court emphasized that the power under Section 9 is discretionary and must be exercised to prevent frustration of the arbitral process.
Headnote
A) Arbitration Law - Post-Award Interim Relief - Section 9 of the Arbitration and Conciliation Act, 1996 - Extension of Bank Guarantee - The petitioner sought continuation of a bank guarantee furnished by the respondent pending challenge to the arbitral award. The court held that Section 9 empowers the court to grant interim measures even after the award is passed, to preserve the subject matter of the arbitration and ensure that the award does not become a paper victory. The court directed the respondent to extend the bank guarantee until the disposal of the challenge petition. (Paras 1-2)
Issue of Consideration
Whether the court can grant post-award interim protection under Section 9 of the Arbitration and Conciliation Act, 1996, by directing extension of a bank guarantee pending adjudication of a challenge to the arbitral award.
Final Decision
The court allowed the petition and directed the respondent to extend the bank guarantee until the disposal of the challenge petition.
Law Points
- Post-award interim protection under Section 9 of the Arbitration and Conciliation Act
- 1996
- Extension of bank guarantee pending challenge to arbitral award
- Scope of Section 9 post-award
