Introduction
The Arbitration and Conciliation Act, 1996 (“Act”) provides two distinct routes for interim protection in aid of arbitration. An application to the Court under Section 9, and an application to the Arbitral Tribunal under Section 17. Each route has its own appellate remedy under Section 37. A question that has arisen in practice is whether, once an Arbitral Tribunal has been constituted, a pending appeal under Section 37(1)(b) against the refusal of Section 9 relief can be sent to the Tribunal by consent and treated as a Section 17 application. In Union of India & Others v. Hariom Projects Pvt. Ltd. (2026 INSC 1044, arising out of SLP (Civil) No. 33087 of 2026), a Division Bench of the Supreme Court comprising Justice Aravind Kumar and Justice Prasanna B. Varale, by order dated 18.09.2026, has answered this question in the negative. The decision is a useful reminder that the jurisdiction conferred on a Court by statute cannot be handed over to an Arbitral Tribunal, even with the agreement of the parties.
Factual Background
The respondent, Hariom Projects Pvt. Ltd., was awarded a contract by the Union of India for the provision of Administrative and Training Infrastructure (Phase-I) at NDA Khadakwasla. Disputes arose during execution concerning adjustments, payment calculations and design issues. The respondent first filed a writ petition (Writ Petition No. 17686 of 2024) seeking constitution of a Dispute Resolution Board (“DRB”), which was allowed on 12.02.2025.
The DRB, once constituted, rejected all the respondent’s claims on 26.04.2025. The respondent then invoked the arbitration clause by notice dated 06.05.2025. The Union issued a show cause notice dated 18.05.2025 alleging deficiencies in performance, followed on 21.07.2025 by a demand for recovery of Rs. 1,46,40,147.32 on the footing that the amount had been overpaid on the basis of a corrected escalation formula.
Seeking interim protection, the respondent filed an application under Section 9 before the District Judge, Pune, praying, among other reliefs, for an injunction restraining the Union from cancelling, terminating or repudiating the contract. That application was dismissed on 15.10.2025. The respondent preferred an appeal under Section 37 before the High Court and also filed a petition under Section 11 for appointment of an arbitrator. While the appeal was pending, the Union terminated the work order on 03.01.2026 on the ground of unsatisfactory performance. The High Court stayed the termination on 05.01.26 and, on 12.01.2026, continued the status quo and permitted the Union to file an affidavit on the quality of workmanship. The High Court then suggested that the parties consider proceeding before an arbitrator who could examine the factual aspects and evolve a working arrangement.
By its order dated 13.01.2026, the High Court appointed Maj. Gen. R.K. Mattu as Sole Arbitrator with the consent of the parties, continued the status quo for two more weeks, and directed that the proceedings before the High Court be remitted to the Arbitral Tribunal to be treated as an application under Section 17 of the Act. The Union challenged only this last direction before the Supreme Court.
Contentions Before the Court
The learned Additional Solicitor General, appearing for the Union, clarified that the appointment of the Sole Arbitrator was not under challenge. His objection was confined to the remittal of the Section 37 proceedings. It was contended that an order under Section 9 can be challenged only by a statutory appeal under Section 37(1)(b), and that such appellate jurisdiction vests exclusively in the Court, so that an Arbitral Tribunal can neither entertain nor adjudicate the issues pending in the appeal. The Union further submitted that the powers of a Court under Sections 9 and 37 are fundamentally distinct from those of a Tribunal under Section 17, and that a Tribunal, being a creature of contract, cannot exercise appellate or supervisory jurisdiction conferred by statute on Courts, even by consent.
It was also argued that allowing the Tribunal to reconsider issues already decided and rejected by the District Court under Section 9 would amount to an impermissible delegation of the High Court’s appellate function, contrary to the statutory scheme and judicial hierarchy under the Act.
Appellate Jurisdiction Under Section 37 Vests Exclusively in the Court
The Supreme Court framed the short point of law as whether a High Court, exercising appellate jurisdiction under Section 37(1)(b) against the rejection of a Section 9 application, can, by consent of the parties, remit the appellate proceedings to a subsequently constituted Arbitral Tribunal and direct it to treat them as an application under Section 17. The Court held that the direction could not be sustained. It observed that appellate jurisdiction under Section 37 is vested exclusively in the “Court” as defined in Section 2(1)(e) of the Act, and that a Tribunal exercising powers under Section 17 does not exercise appellate jurisdiction over an order passed by a competent Court under Section 9.
The Bench noted that the practical effect of the High Court’s direction would be to require the Tribunal to examine the subject matter of a statutory appeal by treating the appellate proceedings as a Section 17 application. In the Court’s view, the nature and source of the powers exercised by an appellate Court under Section 37 are distinct from the powers conferred on an Arbitral Tribunal under Section 17, and the two cannot be interchanged merely by transmitting or remitting the appellate proceedings to the Tribunal. The consent of the parties did not alter this position, as the jurisdiction in question is conferred by the statute and not by the agreement between the parties.
The Course Open to the High Court and Disposal of the Appeal
The Court also indicated what the High Court could have done instead. At the highest, upon constitution of the Arbitral Tribunal, the High Court could have granted the respondent liberty to approach the Tribunal independently under Section 17 for such interim measures as were available in law. The Court further observed that the prayer in the Section 9 application to restrain termination of the contract had spent itself once the work order was terminated on 3 January 2026, and that any further or consequential interim protection would have to be considered in the light of subsequent events and the relief specifically sought by the respondent.
Accordingly, the High Court’s order dated 13.012.2026 was set aside only to the limited extent that it remitted the Section 37 proceedings to the Arbitral Tribunal and directed that they be treated as a Section 17 application. As the Tribunal was already seized of all the issues and had passed several orders, the Supreme Court left all other issues between the parties to be adjudicated by the Tribunal, with both sides at liberty to raise all contentions permissible in law. The Court clarified that the order had been passed only to settle the position of law, and the appeal was disposed of with that modification.
AMLEGALS Remarks
The decision draws a clear line between the supervisory role of the Court under Sections 9 and 37 and the role of the Arbitral Tribunal under Section 17. A party whose Section 9 application has been refused, and whose appeal under Section 37 is pending, cannot expect to convert that appeal into a Section 17 application before the Tribunal, even where the opposite party is willing to agree. Practitioners and parties who are inclined to settle the forum for interim relief by consent, in the interest of expedition, would be well advised to note that jurisdiction conferred by statute cannot be created or transferred by agreement, and that an order recording such an arrangement is open to challenge.
Where an Arbitral Tribunal has been constituted, a party seeking interim measures may approach it afresh under Section 17, based on the circumstances as they then stand, and not by converting the appeal pending before the Court. Parties would also do well to bear in mind that interim reliefs framed around a particular apprehension, such as an injunction against termination, may become infructuous once the event occurs, and that fresh relief would then need to be sought on the changed facts. As always, the outcome in any given case would depend on its specific facts and the terms of the arbitration agreement.
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