Interim orders available only if claim can be specifically enforced

Bombay High Court recently held that no interim order can be passed by a court or an arbitrator under sections 9 and 17 of the Arbitration and Conciliation Act, 1996, where specific performance of a contract cannot be granted under section 14(1)(a) and (b) of the Specific Relief Act, 1963.

In BE Billimoria and Company v Mahindra Bebanco Developers Limited & Anr, Billimoria and Mahindra Lifespace Developers executed a memorandum of understanding in 2008 to form a joint venture (JV) company to bid for a project to develop a residential township in Nagpur district, and to jointly promote a company post grant of bid. Subsequently, Billimoria and Mahindra executed a term sheet for award of the marketing contact to the JV company and the construction contract to Billimoria.

After disputes arose, the JV company invoked bank guarantees. Billimoria filed a section 9 petition against the JV company and others, which had led to a partial injunction against the JV company and Mahindra Lifespace.

The dispute digest is compiled by Bhasin & Co, Advocates, a corporate law firm based in New Delhi. The authors can be contacted at lbhasin@bhasinco.in or lbhasin@gmail.com. Readers should not act on the basis of this information without seeking professional legal advice.