The High Court · 2025

Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to suspend the order dated 03.09.2025 in lA No. 230 of 2025 in Arb. OP. No.2 of 2025 passed by the court of I Additional District and Sessions Judge Yadadri Bhongir District at Bhongir pending disposal of the CMA. Counsel for the Appellants : SRl. J.PRABHAKAR, SR.COUNSEL REP.D.VENKATA PADMAJA Counsel forthe Respondents:SRl JALLI KANAKAIAH, SR.COUNSEL REP. NARENDAR JALLI The Court made the following: ORDER IN THE COURT FOR THE STATE OF TELAI GANA AT HYDERABAD THE HONOURABLE SMT. JUSTICE RENUXI , YARA CI\IIL MISCELLANEOUS APPEAL NO.36 L ,t: 2O2S 24TII DAY OF DECEMBER, 2025 Between: Sri D. Mahendra Reddy and 2 others ...Appellants/ Respondents/ Rc ; rondents Sri Tacluru Narasimha Reddy and another ...Respondents/petitione r r / p.rtitio ners JUDGMENT:

1. Heard Sri J. Prabhakar, learned S,: rior Counsel representing Smt. D. Venkata Padmaja, learned : run sel for the appellants/ respondents/ respondents and Sri I(r rakaiah Ja1li, learned Senior Counsel representing Sri Narendi-: Jalli, learned counsel for respondents/petitioners/ petitioners Pt'rused the record. 2 . This Civil Miscellaneous Appeal is p r :ferred under Order 43 Rule 1(r) of CPC aggrieved by the ordc: passed by the learned I Additional District and Sessions 'J t dge, Yadadri- 7 Bhonir District at Bhongir in I.A.No.230 of 2025 in Arb.O.P.No.2 of2025, dated 03.09 2025.

3. The I.A.No.230 of 2025 is liled by the respondents herein under Order 39 Rule 1 and 2 r/u' Sectron 15i of CPC seeking temporary injunction to restrain the appellants from alienating the petition schedule propertv by a.)' mode pending proceedings under the Arbitration and Conciliation Act. The said petition has been allou'ed issuing ex-parte ad interim injunction restraining the appellants from alienating tl-re petitron schedule property subject to compliance u'ith Order 39 Rule 3 of CPC. Aggneved by said order, the present Civil Miscellaneous Appeal is preferred.

4. The CMA is fited on the ground that the learned Triai Court lacks jurisdiction to adjudicate petition under Order 39 Rule 1 and 2 of CPC in an Arbitration O. P filed under Section 9 of Arbitration and Conciliation Act. Further, the urgencv shown to impress upon the Trial Court to pass ex parte order is questioned when the application was hled on 26.04.2025 arld the impugned orders were passed on O3.O9.2O25. Further, it is pleaded that after numbering of the O. P, an Interlocutory w,1,i/ -l Application could not have been hled under Or<L: I Rule 10 of CPC u,rthout notice to the proposed parties as also parties to thc petitron. The disputc involved is running of the affairs of the firm against the partners. The property which is r trbject rrratter of the injunctior-r granted is personal property oi u ppellant No. I over q'[-rich chargc is created by Axis Bank while ii ailing loan by the partnership firm. There is gross under valuatr, n of the leave sought as the property is worth more than Rs.'+ lr0 Crores and the clispute relates to a commercial transaction. l' rc issue ought to have been presented before a commercia-l coL l I as lhe value is more than Rs. 1.00 Crore. Lastly, it is pleadec that ex-parte injunction cotLld not have been granted until furtt er orders-

5. The learned Senior Counsel for the ap tellar'rts relied upon judgment of the High Court of Judicaturt, Hyderat>ad in the case of Gulf Oil Corporation Limited v. Singareni Collieries Company Limitedl, wherein, it is hell as follon,s: " 1 1 . Therefore, the Court has arr 1 le pou,er to pass appropriate orders even like ad interirr cx parte and also after notice and hearing the respr r dent, as the facts and circumstances warrant. Therr:lc re, when disputt's arise between the parties and whert here is a I 2oo8 (3) ALT 631 (D.8.) 4 provision for settlement of disputes by arbitration proceedings, the parties may havc to approach lor any such relief and necessarily it has to bc trezrted onl1, as an interim application and ciisposed ol zrccordingly.

12. ........ it is brought to our noticc that pending all such applications filed under Section 9 ol the Act. seeking interim reliefs or mezlsures or for an1' directions, once again further interim applications arc being hled like the present onc rvhich is appealecl against in this appeal, seeking furtl-rer or varied interim reliefs by way of injunctions and directions u.hich onlv amounts to duplication of the very cnquiry :rnd adds to the delays in disposal of main intcrim application and repetition of the exercise. Such action is not only (not) permissible and contemplated under the [au' but goes far beyond the scope of provision and objects intended under Section 9 of the Act-.......... Instcad of entertaining applications of this nature, ri'hich may give scope to the parties to go on filing one application alter the other pending the main applic:rtion under Section 9 of the Act, the endeavour shoulcl be to take up the main application under Section 9 of the Act and dispose of the same as expeditiously as possible alter appearance of the respondent. Therefore, u'e hold that having regard to the nature of proceedings as contemplated under Section 9 of Lhe Act, further interim application as has been hled and frarned is neither maintainable nor can require to bc cor-rsidered by the Court. I///

6. On the basis of aforementioned citatior L the learned 5 Senior Counsel for the appellants argued that tlr I Interlocutory application filed under Order 39 Rule I and 2 of (l )C to restrain the appellants lrom alienating or creating chargt c n the petition schedule prope rty is not maintainable. Further, it s arguecl that the property involved is personal property of the : ppellants and saicl propertv u'as mercl-v furnished as security ftr availing loart from Axis Bernk. Further. objection is taken for p I ;sing ex parte interim order u,hen the application under Order i( Rule I al-rd 2 of CPC ri,as sigr-red/filed on 26.O4.2025 and the e\.parte order is passed on 03.09.2O25 i.e. there is a gap of five nr rnths between filing of the petition and passing of the impugned trder.

7. It is argued that the learned Trial Cour ought to have ordered notice for the appellants to present thei: case opposing the interim relief to be granted in the I.A. Last I z, it is argued that any interirn relief granted should not e> ( eed (30) clays whereas order passed by the learned Trial Court s until further orders. On the basis of aJorementioned grounc s, the learned Senior Counsel pra-ved that the impugned order t: set aside. 6 B. The learned counsel for the respondents also relied upon the judgment in case of Gulf Oil Corporation Limited (1 supra|, wherein, it is held that Section 9 provides for the interim arrangement, protection of rights or any direction r.r'l'r ich mav warrant on the facts and circumstances and the partv can invoke said provision to seek any said relief as satisfied thereunder and therefore, the relief enshrined thereunder can salely be put on par with like a grant of injunction, ad interim injunction or appointment of a Receiver etc., as provided for under the regular procedure in the Code of Civil Procedure. Further, reliance is placed upon judgment .of the Hon'ble Supreme Court of India in case of Essar House (Pf Ltd. v. Arcellor Mittat Nippon Steel India Ltd.2, wherein, it is held as follows: "48. Section 9 of the Arbitration Act confers u'ide power on the Court to pass orders securing the amount in dispute in arbitration, whether before the commencement of the arbitral proceedings, during thc arbitral proceedings or at any time after making of the arbitral award, but before its enforcement in accordance with Section 36 of the Arbitration Act. All that the Court is required to see is, whether the of ' zozz (6) ALD 2s7 (sc) \, 7 appli()ant for interim measure has a good zrt pnma far:ic casr'. u'heLi)cr the balzrnce of convenierc: is in lavour of rrltcriln rclief as pra,yed for being grtlt L ed zrnd u,lrettrcr thc applicant has approached the Ccr rt rvith rcasonablt' expetlition." g. The learned counsel for the respondt nts did not squarely address the issue of rvhether a petilirr r filed trnder Order 39 Rule 1 and 2 of CPC seeking int i rim order IS main tain able in an Arbitration O . P hled undc ' Section 9 of Arbitration ancl Conciliation Act. Rather the 1r:r .rned counsel a-rgued that alie nation of the petition schedule : -operty would cause irreparable loss and therefore, the rr,r tter may be remanded to the Trial Court with some interim j -rangement to protect the rights of the respondents.

10. The judgment of this Court in Gulf Oi Corporation Limited (1 supraf ciearly held that a petition rr lder Order 39 Rule 1 and 2 of CPC is not maintainable. The uery nature of relief to be sought under Section 9 of ./r bitration and Conciliation Act is interim reiief and therefore, li rther petitions to be filed seeking interim relief are not contem r ated. To put it simply, the I.A is not maintainable. Further, 1 re Trial Court ought to have consldered the factual aspect ,,f filing of the I I 8 Interlocutory Application in April, 2025 and pressing for interim relief in the month of September, 2025. The gap of (5) months between signing/ liling of the application and pressing lor interim orders shows that there was no urgency to press lor interim reliefs. Even otherwise, the Trial Court could have issued notice belore passing interim order. Also, without adjudication of the Arbitration O.P on merits, interim order until further orders should not have been granted. I 1 . In vieu, of the foregoing discussion, this Civil Miscellaneous Appeal is allowed setting aside the order passed b-y the learned I Additional District and Sessions Judge, Yadadri Bhongir District at Bhongir in I.A.No.23O of 2025 in Arb.O.P.No.2 of 2025, dated 03.09 2025 As a sequel, pending miscellaneous applications, if any, shall stand closed. There shall be no order as to costs. //TRUE COPY// SD/- M. RAMANA KRISHNA JOINT REGISTRAR 6 SECTION OFFICER To, 1 2 .7 4 /S a KS ThelAdditionalDistrict&SessionsJudge,Yadagiri.BhongirDistrict O"" Ci t" Sti D.Venkata Padmaja, Advocate (OPUC) il; cd iJ 5ti tlrr"noer Jalli, Ad-vocate (oPUC) Two CD CoPies HIGH COURT DATED:241121202s t I JUDGMENT CMA.No.361 of 2025 t -:si1' t 07,iN2026 o * ? L) ,// ALLOWING THE C.M.A WITHOUT COSTS. b r\pb