Supreme Court Holds a Section 37 Appeal Against Refusal of Interim Relief Cannot Be Remitted to the Arbitral Tribunal

Kaustav Chowdhury

5 days ago

6 min read

Background and Facts

A Section 37 appeal is an exercise of appellate jurisdiction by a court, and an arbitral tribunal cannot be asked to perform it. The Supreme Court has set aside a direction of the Bombay High Court remitting a pending appeal against the refusal of interim relief to a newly constituted tribunal, to be treated as an application for interim measures. The judgment in Union of India v. Hariom Projects Private Limited, 2026 INSC 1044 [arising out of Special Leave Petition (Civil) No. 33087 of 2026], was delivered on September 18, 2026 by a Bench of Justice Aravind Kumar and Justice Prasanna B. Varale.

The contract was for administrative and training infrastructure, Phase I, at the National Defence Academy at Khadakwasla. Disputes arose over adjustments, payment calculations and design. On July 21, 2025 the Union demanded recovery of Rs 1,46,40,147.32, said to have been overpaid on a corrected escalation formula.

Hariom Projects applied to the District Judge at Pune under Section 9 of the Arbitration and Conciliation Act, 1996 for an injunction restraining the Union from cancelling or terminating the contract. That application was rejected on October 15, 2025. The Union terminated the work order on January 3, 2026 for unsatisfactory performance, and the High Court stayed the termination on January 5, 2026. On January 13, 2026, hearing the appeal under Section 37, the High Court appointed a sole arbitrator and directed that the pending appellate proceedings be remitted to the tribunal to be treated as an application under Section 17.

Key Legal Issue

Whether a High Court hearing an appeal under Section 37 of the Arbitration and Conciliation Act, 1996 against an order refusing interim relief under Section 9 may remit those appellate proceedings to the arbitral tribunal, to be dealt with as an application under Section 17, even with the consent of the parties.

The Supreme Court's Ruling

It may not. The direction remitting the appeal was set aside, and the tribunal was left free to proceed with the substantive disputes.

Appellate Jurisdiction Is Vested in a Court

The reasoning starts from where the statute places the power. Section 37(1) provides that, notwithstanding anything in any other law, an appeal shall lie from the orders it lists and from no others, to the court authorised by law to hear appeals from original decrees. An order granting or refusing a measure under Section 9 is one of those orders. Section 37(2) separately allows an appeal to a court from an order of the tribunal granting or refusing an interim measure under Section 17.

The architecture therefore runs in one direction only. Appeals move from the tribunal to the court, never the other way. The Court put the point in terms of what the tribunal is not:

"An Arbitral Tribunal exercising powers under Section 17 does not exercise appellate jurisdiction over an order passed by a competent Court under Section 9". Section 37 appellate jurisdiction is vested exclusively in the Court, and the powers under Sections 17 and 37 are distinct and cannot be interchanged.

Consent Cannot Supply Jurisdiction

The remittal had been directed with the parties' agreement, and that did not save it. Jurisdiction over an appeal is conferred by statute, and the parties cannot confer on a tribunal a jurisdiction the Act gives to a court. This is the orthodox position on consent and jurisdiction, applied to a procedural short cut that the parties had agreed to.

The practical objection is as strong as the doctrinal one. An order made by a tribunal under Section 17 is appealable under Section 37(2)(b). Converting a pending Section 37 appeal into a Section 17 application therefore does not end the litigation; it restarts it a rung lower, with a fresh appeal available from whatever the tribunal decides.

What the Two Interim Powers Actually Do

Section 9(1) allows a party to apply to a court for interim measures before or during arbitral proceedings, and after the award is made but before it is enforced under Section 36. Section 9(3) then limits the court: once the tribunal has been constituted, the court shall not entertain an application under sub-section (1) unless it finds that circumstances exist which may not render the remedy under Section 17 efficacious.

Section 17(1) gives the tribunal power, during the arbitral proceedings, to order interim measures of protection in the same broad categories, and Section 17(2) makes such an order deemed to be an order of the Court, enforceable under the Code of Civil Procedure, 1908, subject to any order in an appeal under Section 37. The two powers overlap in subject matter and differ in forum. Neither is an appeal from the other.

Practice Notes

In practice, the judgment closes off a shortcut and makes the election between the two forums a decision to be taken rather than blurred:

Do not consent to a remittal: An agreed order transferring a Section 37 appeal to the tribunal is liable to be set aside, and the time spent before the tribunal on that footing is wasted. If the client wants the tribunal to decide interim relief, withdraw the appeal and apply under Section 17 instead.
Choose the forum before the tribunal is constituted: Section 9(3) makes the court's door narrower once a tribunal exists, because the applicant must then show that the Section 17 remedy would not be efficacious. Where urgent protection is needed before constitution, the Section 9 application should be moved promptly.
An appeal and a fresh application are different animals: On appeal the question is whether the order refusing relief was wrong. Before the tribunal the question is whether relief should be granted now, on the material as it stands. The second is often the better forum on facts that have moved on, and the election should be made deliberately.
Remember Section 17 orders are appealable: Section 37(2)(b) provides an appeal from an order granting or refusing an interim measure under Section 17. Routing a dispute to the tribunal does not remove the possibility of an appeal, so it is not a route to finality.
Keep the appointment question separate: Appointing an arbitrator and disposing of an interim relief appeal are different exercises. Where both come before the same bench, ask for the appeal to be decided or withdrawn on its own terms rather than folded into the appointment order.

Key Provisions Discussed

Section 9 of the Arbitration and Conciliation Act, 1996: Interim measures by a court, available before or during arbitral proceedings and after the award but before enforcement under Section 36, with sub-section (3) barring the court from entertaining an application once the tribunal is constituted unless the remedy under Section 17 would not be efficacious.
Section 17 of the Arbitration and Conciliation Act, 1996: Interim measures ordered by the arbitral tribunal during the arbitral proceedings, with sub-section (2) deeming such an order to be an order of the Court and enforceable under the Code of Civil Procedure, 1908, subject to any order in an appeal under Section 37.
Section 37 of the Arbitration and Conciliation Act, 1996: Appealable orders, with sub-section (1) allowing an appeal from the listed orders and from no others, including an order granting or refusing a measure under Section 9, and sub-section (2)(b) allowing an appeal from an order of the tribunal granting or refusing an interim measure under Section 17.

Case Details

Case: Union of India v. Hariom Projects Private Limited
Citation: 2026 INSC 1044
Case No: Arising out of Special Leave Petition (Civil) No. 33087 of 2026
Court: Supreme Court of India
Bench: Justice Aravind Kumar and Justice Prasanna B. Varale
Date of Judgment: September 18, 2026
Order Below: Order of the Bombay High Court dated January 13, 2026 remitting the Section 37 appeal to the arbitral tribunal
Outcome: The direction remitting the appeal set aside. The tribunal may proceed with the substantive disputes between the parties.

Sources and References

Disclaimer: This article is for informational purposes only and does not constitute legal advice. Readers should consult a qualified legal professional for advice specific to their circumstances.