Home Care Retail Marts Pvt Ltdv.Haresh N Sanghavi

Legal Analysis: Home Care Retail Marts Pvt. Ltd. vs. Haresh N. Sanghavi

Citation: 2026 INSC 415
Court: Supreme Court of India
Bench: Justice Manmohan & Justice Manoj Misra 
Judgment Author: Justice Manmohan
Date of Decision: April 24, 2026
Nature of Judgment: Civil Appeal under Section 136 of the Constitution of India, arising from multiple SLPs; the Court decided a substantial question of law on the maintainability of Section 9 petitions under the Arbitration and Conciliation Act, 1996 at the post-award stage by an unsuccessful party.

Synopsis of the Judgment

The Supreme Court resolved a conflict among High Courts on whether a party that has lost in arbitral proceedings (i.e., has no enforceable award in its favour) can maintain a petition under Section 9 of the Arbitration and Conciliation Act, 1996 at the post-award stage (after the award is made but before it is enforced under Section 36). The Bombay, Delhi, Madras and Karnataka High Courts had held that such a party cannot seek interim relief under Section 9, as the provision is meant only to protect the “fruits of the award” for the successful party. The Telangana, Gujarat and Punjab & Haryana High Courts had taken a contrary view. The Supreme Court overruled the former line of authority, holding that the plain language of Section 9 permits “a party” (defined as any party to the arbitration agreement) to apply for interim measures at three stages – before, during, or after the arbitral award (but before its enforcement). The Court held that the expression “a party” cannot be contextually modulated based on the outcome of the arbitration. The Court also noted that the 2019 amendments, the power of courts to modify awards under Section 34 (following Gayatri Balasamy), and the need to prevent irreparable prejudice pending challenge under Section 34, all support the maintainability of such petitions. However, the Court clarified that the threshold for granting interim relief to an unsuccessful party would be higher, and such relief should be granted only in rare and compelling cases.

1. Basic Information of the Judgment

Field Details Case Title Home Care Retail Marts Pvt. Ltd. vs. Haresh N. Sanghavi (with connected appeals) Civil Appeal Nos. Arising out of SLP (C) No. 29972/2015, SLP (C) No. 26876/2014, and SLP (C) No. 11139/2020 Bench Justice Manmohan (Single Judge) Date of Decision April 24, 2026 Citation 2026 INSC 415 Appeal From Orders of Bombay High Court, Delhi High Court, and other High Courts (consolidated)

2. Legal Framework

Laws Involved:

• Arbitration and Conciliation Act, 1996 (the Act): Section 9 (interim measures by court – three stages: before, during, or after award but before enforcement), Section 2(h) (definition of “party” – a party to an arbitration agreement), Section 34 (application for setting aside arbitral award – court can modify award post- Gayatri Balasamy), Section 36 (enforcement of award and stay thereof), Section 37 (appealable orders), Section 43(4) (exclusion of time in limitation), Section 5 (extent of judicial intervention).

• UNCITRAL Model Law on International Commercial Arbitration: Article 9 (interim measures only before or during arbitral proceedings – no post‑award stage).

• Arbitration Act, 1940 (repealed): Section 18 (interim measures confined to successful party for enforcement).

Precedents Cited (including conflicting High Court decisions):

Decision Holding (on the question) Dirk India Pvt. Ltd. v. Maharashtra State Electricity Generation Co. Ltd. (2013) Bom HC Unsuccessful party cannot maintain Section 9 at post‑award stage; purpose is to protect “fruits of the award”. Nussli Switzerland Ltd. v. Organizing Committee Commonwealth Games (2014) Del HC Followed Dirk India. National Highways Authority of India v. Punjab National Bank (2023) Del HC Same. A. Chidambaram v. S. Rajagopal (2024) Mad HC Same. Padma Mahadev v. Sierra Constructions (2021) Kar HC Same. GAIL (India) Ltd. v. Latin Rasayani Pvt. Ltd. (2014) Guj HC Unsuccessful party can maintain Section 9.M/s Saptarishi Hotels Pvt. Ltd. v. NITHM (2019) TS HC Same. DLF Home Developers Ltd. v. Orris Infrastructure Pvt. Ltd. (2025) P&H HC Same.

Supreme Court judgments discussed/relied upon:

• Sundaram Finance Ltd. v. NEPC India Ltd. (1999) 2 SCC 479 – Section 9 permits application at three stages.

• Firm Ashok Traders v. Gurumukh Das Saluja (2004) 3 SCC 155 – “Party” under Section 9 means party to arbitration agreement.

• Hindustan Construction Co. Ltd. v. Union of India (2020) 17 SCC 324 – Affirmed that Section 9 relief is available post‑award (but not specifically on unsuccessful party).

• Gayatri Balasamy v. ISG Novasoft Technologies Ltd. (2025) SCC OnLine SC 986 (Constitution Bench) – Courts under Section 34/37 can modify arbitral award (sever invalid portions, correct errors).

• Essar House Private Ltd. v. Arcellor Mittal Nippon Steel India Ltd. (2022) 20 SCC 178 – Principles for grant of interim relief under Section 9 (prima facie case, balance of convenience, irreparable harm).

• State of West Bengal v. Union of India AIR 1963 SC 1241 – Statutory interpretation: words to be read in context of entire statute.

• DLF Qutab Enclave Complex Educational Charitable Trust v. State of Haryana (2003) 5 SCC 622 – Court shall not go beyond statute unless absolutely necessary.

What the Judgment is About: The judgment settles a major procedural question under the Arbitration Act: whether a party whose claims have been rejected by an arbitral tribunal can approach a court for interim protection (e.g., security, injunction) under Section 9 after the award is rendered but before it is enforced. The Court held that the plain language of Section 9 permits any party (including an unsuccessful one) to seek interim measures, overruling the restrictive interpretation adopted by several High Courts. The Court distinguished the UNCITRAL Model Law (which does not have a post‑award stage) and noted that the Indian Parliament deliberately expanded Section 9 by adding the post‑award stage without limiting it to successful parties.

3. Relevant Facts of the Case

The judgment is a consolidation of multiple special leave petitions arising from different High Court orders. The factual matrix of individual appeals is not detailed because the appeals were heard on the pure question of law. The essential facts are:

• In each case, a party that had lost in arbitration (i.e., its claims were rejected or it was held liable) filed an application under Section 9 of the Act before a court after the arbitral award was made but before its enforcement under Section 36.

• The respective High Courts either allowed or dismissed such applications based on their divergent interpretations of Section 9.

• The Supreme Court took up the batch of appeals to resolve the conflict.

• The Court framed the substantial question of law as: “whether a petition under Section 9 of the Arbitration and Conciliation Act, 1996 at the post‑award stage, by a party that has lost in the arbitral proceedings and has no enforceable award in its favour, is maintainable in law?”

4. Issues

1. Whether the expression “a party” in Section 9 of the Act, read with Section 2(h), includes an unsuccessful party in arbitral proceedings (i.e., a party against whom no enforceable award exists) when seeking interim relief after the award is made but before its enforcement.

2. Whether the post‑award stage under Section 9 is intended only to protect the “fruits of the award” for the successful party, or whether it can also be invoked by an unsuccessful party to preserve the subject matter of arbitration or the amount in dispute pending a challenge to the award under Section 34.

3. Whether the power of courts to modify an award under Section 34 (post-Gayatri Balasamy) and the availability of a stay under Section 36(3) affect the maintainability of a Section 9 petition by an unsuccessful party.

4. What threshold should apply when an unsuccessful party seeks interim relief under Section 9 at the post‑award stage.

5. Ratio Decidendi

A. Plain language of Section 9 – “a party” means any party to the arbitration agreement, regardless of success

The Court held that Section 9(1) uses the words “a party may … apply to a court”. The term “party” is defined in Section 2(h) as “a party to an arbitration agreement”. Neither provision distinguishes between successful and unsuccessful parties. The statute is unambiguous. Therefore, the Court must give effect to the literal meaning. Any attempt to read down the provision to exclude an unsuccessful party would amount to judicial amendment of the statute, which is impermissible (Para 28-33).

B. Three distinct stages under Section 9 – legislative intent

Section 9 expressly permits an application: (i) before arbitral proceedings, (ii) during arbitral proceedings, or (iii) after the making of the arbitral award but before it is enforced in accordance with Section 36. The UNCITRAL Model Law (Article 9) only provides for interim measures before or during proceedings. The Indian Parliament deliberately added the post‑award stage. This expansion shows legislative intent to confer a right on parties even after the award is made. No restriction was placed on which party can invoke this right. (Para 34-40)

C. Overruling the “fruits of the award” rationale

The Bombay High Court in Dirk India and other High Courts reasoned that at the post‑award stage, the only purpose of Section 9 is to protect the “fruits of the award” for the successful party. The Supreme Court rejected this as an unwarranted restriction. It noted that Section 9(1)(ii) expressly allows orders to secure “the amount in dispute” or “the subject matter of arbitration” – both broader concepts than “fruits of the award”. Moreover, if the award is set aside or modified under Section 34, the unsuccessful party may regain a right to claim. During the pendency of Section 34 proceedings, irreparable prejudice could occur if interim protection is not available. (Para 44-47)

D. Power to modify awards under Section 34 (post-Gayatri Balasamy) supports the view

The Constitution Bench in Gayatri Balasamy held that courts under Section 34/37 can modify an arbitral award by severing invalid parts, correcting errors, etc. This means that an unsuccessful party’s challenge may result in a modified award in its favour. Denying interim relief during such challenge would render the challenge ineffective if assets are dissipated. Therefore, the Court held that the unsuccessful party cannot be left remediless. (Para 45)

E. Distinction between Sections 34/36 and Section 9

Sections 34 (challenge to award) and 36 (stay of enforcement) operate in distinct spheres. An unsuccessful party can seek a stay under Section 36(3) on conditions. However, a stay under Section 36 only prevents enforcement of the award; it does not provide positive interim protection such as securing assets or preserving the subject matter. Section 9 fills that gap. The two remedies are complementary, not mutually exclusive. (Para 42-43)

F. Higher threshold for unsuccessful parties – rare and compelling cases

While holding that the remedy is available, the Court clarified that the threshold for granting interim relief to an unsuccessful party would be higher. The court must apply the usual triple test (prima facie case, balance of convenience, irreparable harm) but with greater rigour. Relief should be granted only in rare and compelling cases, e.g., where the award was obtained by fraud or without notice, or where the challenge is strong and the risk of dissipation is acute. The Court gave illustrations (para 49-52) where such relief may be justified. (Para 59-60)

G. Rejection of purposive/contextual interpretation

The Court held that the statutory language is clear and does not lead to absurdity or injustice. Therefore, resort to contextual or purposive interpretation is not permissible. The test for reading words into a statute is of a very high threshold, not met here. (Para 55-58)

6. New Legal Principles Established / Reiterated

• Unsuccessful party in arbitration can file Section 9 petition at post‑award stage: Overruling the line of High Court judgments (Dirk India, Nussli, etc.), the Supreme Court held that any party to an arbitration agreement, irrespective of the outcome of the arbitration, may seek interim measures under Section 9 after the award is made but before its enforcement.

• The “fruits of the award” is not the only legitimate purpose of post‑award interim relief: The Court clarified that securing the amount in dispute or the subject matter of arbitration (as stated in Section 9) is equally important. An unsuccessful party may need such protection pending challenge to the award.

• The power to modify awards under Section 34 reinforces the need for interim relief: Following Gayatri Balasamy (Constitution Bench), an award can be modified, so the unsuccessful party may ultimately succeed. Interim relief under Section 9 is available to preserve that possibility.

• Higher threshold for unsuccessful parties: Courts must be more circumspect when granting Section 9 relief to an unsuccessful party. A strong prima facie case (e.g., fraud, lack of notice, patent illegality) and a real risk of irreparable harm are required.

7. Court’s Analysis and Examination of Concepts

• Literal interpretation vs. contextual modulation: The Court emphasised that Section 9 uses the word “party” throughout without qualification. If the legislature intended to restrict post‑award relief to successful parties, it would have said so (as it did in the 1940 Act, Section 18). The absence of such restriction is deliberate.

• Comparison with UNCITRAL Model Law: The Model Law’s Article 9 does not contain a post‑award stage. India’s Act added it. This legislative choice must be given effect. The fact that the Model Law does not provide for post‑award interim relief cannot be used to restrict India’s statute. (Para 37-40)

• Practical illustrations of need: The Court gave hypotheticals: (i) award rendered without notice to a party; (ii) award tainted by fraud; (iii) a partially successful party whose counter‑claim was allowed but whose claim was rejected, and the award may be modified. In each case, interim relief under Section 9 may be essential to prevent irreversible prejudice. (Para 49-52)

• Overruling of Dirk India line: The Court rejected the reasoning that Section 9(ii) is intended only to “safeguard the fruit of the proceedings until the eventual enforcement of the award”. That interpretation unduly narrows the statutory language. The Court also noted that the observation in Hindustan Construction Co. (which quoted Dirk India) did not decide the present issue; it was a passing reference and not binding as a precedent under Article 141. (Para 53-54)

• No conflict with Section 36: The Court clarified that Section 36(3) provides for a stay of enforcement, which is a different remedy. Section 9 is broader and can grant positive interim measures. The two are not mutually exclusive.

8. Critical Analysis

Strengths: The judgment is a model of plain‑meaning statutory interpretation. It respects the legislative choice to expand the scope of Section 9 beyond the UNCITRAL Model Law. It corrects a significant error that had been perpetuated by several High Courts, which had effectively read words into the statute (“successful party”) that were not there. The recognition that an unsuccessful party may have legitimate need for interim protection (e.g., to prevent dissipation of assets, to preserve the subject matter) is pragmatic and just. The higher threshold prescribed for such relief balances the need to prevent misuse with the need to provide access to justice.

Potential concerns: The judgment may lead to an increase in Section 9 applications by unsuccessful parties, potentially causing delay and added litigation costs. However, the high threshold (rare and compelling cases) and the court’s discretion to refuse relief where the challenge is weak should mitigate this risk. Also, the judgment does not elaborate on how the “higher threshold” is to be operationalised – e.g., whether the unsuccessful party must show that the award is prima facie liable to be set aside or modified. Future courts will need to develop this guidance.

Practical impact: This decision will be cited in every case where a party seeks interim relief after losing in arbitration. It overrules the restrictive view that had been adopted by several High Courts, thus bringing uniformity. It will allow unsuccessful parties to protect assets or seek security when they challenge an award under Section 34, especially where the award is of a substantial monetary value and the successful party may attempt to dissipate assets.

9. Final Outcome

The Supreme Court held that a petition under Section 9 of the Arbitration and Conciliation Act, 1996 at the post‑award stage is maintainable by a party that has lost in the arbitral proceedings and has no enforceable award in its favour. The contrary view expressed by the Bombay High Court in Dirk India, the Delhi High Court in Nussli Switzerland and NHAI, the Madras High Court in A. Chidambaram, and the Karnataka High Court in Padma Mahadev is overruled. The correct position is that expressed by the Telangana, Gujarat, and Punjab & Haryana High Courts. However, the court clarified that the threshold for granting interim relief to an unsuccessful party is higher, and such relief should be granted only in rare and compelling cases. The civil appeal arising out of SLP (C) No.11139/2020 was disposed of in terms of the judgment; the other appeals were listed for hearing on merits after four weeks (since they involved factual disputes).

10. Practical Application (Use in Court)

• By unsuccessful parties in arbitration (claimants/counter‑claimants who lost): Immediately after the arbitral award is rendered against you, file a challenge under Section 34. Simultaneously, file an application under Section 9 before the court seeking interim protection (e.g., attachment of assets, security, injunction against dissipation). Cite this judgment to argue that you have a right to seek such relief even though you are the “losing party”. However, be prepared to show a strong prima facie case that the award is vulnerable (e.g., fraud, patent illegality, lack of notice) and that there is a real risk of irreparable harm.

• By successful parties (award holders): If the losing party files a Section 9 petition, oppose it by arguing that the threshold for granting relief is high. Show that the challenge to the award is frivolous or that the losing party cannot demonstrate a prima facie case. Also, point to the availability of a stay under Section 36(3) as a more appropriate remedy. However, note that the Court has clearly held that Section 9 is maintainable, so you cannot succeed on jurisdiction alone; you must contest on merits.

• By courts (trial courts/High Courts): When an unsuccessful party files a Section 9 petition at the post‑award stage, do not dismiss it on the ground of maintainability. Instead, apply the triple test (prima facie case, balance of convenience, irreparable harm) with a higher degree of scrutiny. Examine whether the challenge to the award under Section 34 is genuine and not frivolous. If the petitioner fails to meet the higher threshold, decline relief. If the threshold is met, grant appropriate interim measures, tailoring them to avoid prejudice to the successful party.

11.  Court Lines

“The meaning of the expression ‘a party’ cannot be contextually modulated or varied depending upon the outcome of the arbitral proceedings. Such modulation would amount to judicial amendment of the statute, which lies beyond the province of the Court.” (Para 33)

“Where the legislature has expressly provided that measures under Section 9 of the Act may secure the subject matter of arbitration or the amount in dispute, the Court in Dirk India … could not have restricted its ambit to securing an enforceable claim of the successful party.” (Para 47)

“The test of whether the plain meaning of words leads to repugnancy, injustice, or absurdity is of a very high threshold and may be applied only in the rarest of rare cases, and that too for compelling reasons.” (Para 57)

“Undoubtedly, the threshold for grant of interim relief will be higher in the case of an unsuccessful party in arbitration seeking such relief. In rare and compelling cases, permitting the unsuccessful party to invoke Section 9 of the Act would prevent irreparable prejudice and preserve the efficacy of the challenge proceedings.” (Para 60)

12. Legal Strategy Insight

For the unsuccessful party (applicant under Section 9): 

File your Section 9 application simultaneously with your Section 34 petition. In the application, plead the specific grounds that make the award vulnerable – do not rely on vague allegations. Obtain evidence of the successful party’s attempts to dissipate assets or an imminent threat to the subject matter. Emphasise that if interim relief is not granted, the Section 34 challenge will become infructuous (the doctrine of fructus legis). Cite this judgment and also rely on Gayatri Balasamy to argue that the award can be modified, so your claim may succeed. Request the court to order security or attachment. Be prepared for a higher standard of proof; present a strong, documented prima facie case.

For the successful party (award holder): If the losing party files a Section 9 petition, do not waste time arguing maintainability (that argument is now closed). Instead, focus on the merits: (i) show that the challenge to the award is weak or devoid of substance; (ii) demonstrate that there is no risk of dissipation (e.g., you are a solvent company, assets are not being transferred); (iii) argue that the balance of convenience favours letting the award be enforced and any amount recovered later, especially if security is already available. If the court is inclined to grant relief, request that the relief be conditional upon the unsuccessful party depositing a substantial amount or furnishing a bank guarantee to compensate you in case the award is upheld. Also, consider filing execution proceedings under Section 36 to put pressure on the unsuccessful party.