The Inefficacious Standard: Forum Shopping And The Reform Of India’s Arbitral Interim Relief Regime
- IJLLR Journal
- Jul 7
- 2 min read
Kripa Daryani, B.B.A. LL.B. (Hons.), Kirit P. Mehta School of Law, NMIMS, Mumbai
ABSTRACT
This article is an attempt at conducting a doctrinal analysis of the concurrent interim relief jurisdiction conferred upon courts and arbitration tribunals by Sections 9 and 17 of the Arbitration and Conciliation Act, 1996, which highlights the irony of how the undefined “inefficacious remedy” criterion introduced by the 2015 Amendment has ended up fostering forum-shopping and satellite litigation, which was precisely what the Amendment was designed to prevent. By undertaking a comprehensive analysis of the judgments primarily, “Arcelor Mittal Nippon Steel India Ltd. v. Essar Bulk Terminal Ltd. (2022)”, “Welspun Enterprises Ltd. v. Kasthuri Infra Projects (2024)”, and “Asad Mueed & Anr. v. Hammad Ahmad & Ors. (2023)”, the article reveals how the lack of an efficacious threshold in respect of the inefficacy standard has led to interpretive inconsistencies among the various High Courts and the ability of savvy litigants to abuse the jurisdiction gateway set out by Section 9(3). It brings out three pathologies of this system: (i) the pre-constitution forum-shopping technique made possible because of the wide applicability of Section 9 before the Constitution; (ii) the post- constitution use of the “inefficacious” exception; and (iii) the open-ended third-party problem within Section 17 jurisdiction. This article conducts a critical analysis of the Draft Arbitration and Conciliation Bill, 2024, contending that the proposed amendment that would result in the repeal of Section 9(3) is likely to be an overcorrection and proposes three judicial reforms that could be implemented immediately. These include making the prior-approach test a necessary precondition to Section 9 applications; imposition of exemplary costs where the application is made tactically; and constitution of the Bench for determining the ambit of powers of the third- party tribunal under Section 17.
Keywords: Arbitration and Conciliation Act 1996; Section 9; Section 17; Forum Shopping; Interim Relief; Inefficacious Remedy; Procedural Delay; 2015 Amendment; Draft Bill 2024; Third-Party Relief; Comparative Arbitration Law.
