1. Introduction to Section 17 of the Arbitration Act
Section 17 of the Arbitration and Conciliation Act, 1996 empowers arbitral tribunals in India to grant interim measures during arbitration proceedings. These measures are vital to safeguard the interests of parties, prevent injustice, and preserve the subject matter of the dispute until a final award is rendered.
Section 17 was significantly amended in 2015 and 2019 to strengthen the powers of arbitral tribunals and align them more closely with those of civil courts under Section 9 of the Act.
Within this section, Section 17(1)(b) plays a crucial role, outlining the tribunal’s power to issue specific orders for protection during the arbitration process.
2. Text of Section 17(1)(b)
Section 17(1) provides that an arbitral tribunal may, at the request of a party, grant interim measures of protection. Specifically, clause (b) empowers the tribunal to order measures it deems necessary for the protection of goods, property, or assets related to the dispute.
In simplified form, Section 17(1)(b) states:
“The arbitral tribunal may order a party to take any interim measure of protection in respect of the subject matter of the dispute, such as the detention, preservation, or inspection of any property or thing under dispute, or authorizing any person to take such action.”
3. Purpose of Section 17(1)(b)
The main purpose of Section 17(1)(b) is to:
- Prevent the destruction or alienation of property related to the dispute.
- Maintain the status quo until the arbitral award is issued.
- Protect the rights of the parties and the value of the disputed assets.
- Provide relief without requiring parties to approach the civil courts.
This provision ensures that arbitral tribunals have real authority to safeguard assets and evidence during proceedings.
4. Evolution of Section 17
Originally, before the 2015 Amendment, Section 17 was limited in scope — tribunal orders were not enforceable like court orders, leading parties to approach courts under Section 9 for interim relief.
The 2015 Amendment Act drastically changed this by giving Section 17 orders the same enforceability as a court order. This reform made arbitration more efficient and self-contained, reducing unnecessary judicial intervention.
5. Scope of Powers under Section 17(1)(b)
Section 17(1)(b) gives arbitral tribunals broad discretion to issue interim protective orders. These include:
- Directing the preservation or custody of property under dispute.
- Ordering the inspection or photographing of goods or property.
- Allowing the sale of perishable goods.
- Preventing a party from disposing of assets that may affect the award.
- Authorizing a third party to secure or manage property temporarily.
This ensures that the subject matter of the arbitration remains intact and the final award is not rendered meaningless.
6. Difference Between Section 9 and Section 17(1)(b)
While both sections deal with interim measures, their application differs:
| Aspect | Section 9 | Section 17(1)(b) |
|---|---|---|
| Authority | Civil Court | Arbitral Tribunal |
| Timing | Before, during, or after arbitration | Only during arbitration proceedings |
| Enforcement | Automatically enforceable as court order | Enforceable as court order (post-2015 amendment) |
| Objective | Judicial support | Arbitral autonomy |
Section 17(1)(b) thus empowers arbitrators to grant interim relief directly, minimizing dependence on courts.
7. Key Judicial Interpretations
Indian courts have clarified the scope of Section 17(1)(b) in several judgments:
- Sundaram Finance Ltd. v. NEPC India Ltd. (1999): Recognized the need for tribunals to have interim powers, leading to eventual statutory amendments.
- BCCI v. Kochi Cricket Pvt. Ltd. (2018): Affirmed the enforceability of tribunal orders under Section 17 post-2015 amendment.
- Amazon.com NV Investment Holdings LLC v. Future Retail Ltd. (2021): The Supreme Court held that emergency arbitrator orders under Section 17 are valid and enforceable, giving full effect to the provision.
These cases underscore that Section 17(1)(b) is now a powerful tool for interim protection within arbitration.
8. Procedure for Seeking Relief under Section 17(1)(b)
To seek relief under Section 17(1)(b):
- File an Application: The concerned party must submit a written request to the tribunal, stating the nature and urgency of the interim measure.
- Notice to Opposite Party: The tribunal usually gives the other party an opportunity to respond.
- Hearing and Evidence: Both sides may present arguments or evidence to justify their positions.
- Order Issued: The tribunal grants or rejects the request, with conditions as necessary.
- Enforcement: Once issued, the order is enforceable as if it were an order of a civil court.
This process ensures fairness, transparency, and judicial equivalence in arbitral proceedings.
9. Importance of Section 17(1)(b) in Arbitration
Section 17(1)(b) strengthens the overall arbitration mechanism by:
- Reducing reliance on courts for interim protection.
- Increasing tribunal efficiency and independence.
- Protecting the subject matter and evidence.
- Enhancing party confidence in arbitration.
- Promoting faster dispute resolution.
It reflects India’s commitment to international arbitration standards, ensuring that arbitral tribunals have sufficient authority to deliver justice effectively.
10. Limitations of Section 17(1)(b)
Despite its strengths, Section 17(1)(b) has practical limitations:
- It applies only after the tribunal is constituted.
- Pre-arbitration interim relief must still be sought under Section 9.
- Enforcement, while streamlined, may involve procedural delays in some jurisdictions.
- The tribunal’s powers are limited to the subject matter of the arbitration, not beyond.
Nevertheless, these limitations are balanced by the increased autonomy given to tribunals post-2015.
11. Comparative Perspective
Globally, many arbitration-friendly jurisdictions—such as Singapore, the UK, and Hong Kong—grant similar interim powers to arbitral tribunals.
Section 17(1)(b) aligns Indian arbitration practice with these international norms, ensuring that India remains a competitive and reliable jurisdiction for arbitration.
12. Impact of Section 17(1)(b) on Commercial Arbitration
For businesses and investors, Section 17(1)(b) provides a crucial safeguard during disputes.
It allows assets to be protected, prevents dissipation of funds, and ensures compliance with contractual obligations while arbitration is pending. As a result, commercial arbitration in India has become more predictable and secure.
13. Enforcement of Tribunal Orders
Following the 2015 amendment, any order issued by an arbitral tribunal under Section 17 is enforceable in the same manner as a civil court order.
This ensures that non-compliance with tribunal orders can lead to contempt proceedings or execution through courts, making the arbitration process robust and effective.
14. Future Outlook
Section 17(1)(b) continues to evolve with judicial interpretation and practice. As arbitration in India becomes increasingly institutionalized, the use of interim measures under this section is expected to grow, ensuring effective protection of parties’ rights and assets.
15. Conclusion
Section 17(1)(b) of the Arbitration and Conciliation Act, 1996 is a cornerstone provision that empowers arbitral tribunals to grant interim protection and preserve the subject matter of disputes. By giving tribunals enforceable powers equivalent to courts, it strengthens India’s arbitration framework and promotes efficiency, fairness, and autonomy in dispute resolution.
Frequently Asked Questions
1. What is Section 17(1)(b) of the Arbitration Act?
It allows arbitral tribunals to grant interim measures to protect property, assets, or evidence related to the dispute during arbitration proceedings.
2. Can a tribunal’s order under Section 17(1)(b) be enforced?
Yes, after the 2015 amendment, such orders are enforceable like court orders.
3. What is the difference between Section 9 and Section 17(1)(b)?
Section 9 empowers courts to grant interim measures, while Section 17(1)(b) gives similar powers to arbitral tribunals during proceedings.
4. Can interim relief be sought before arbitration begins?
No, Section 17 applies only after the tribunal is constituted. Pre-arbitration relief must be sought under Section 9.
5. What kinds of protection can the tribunal grant?
The tribunal can order the preservation, detention, inspection, or custody of property and other necessary measures to prevent injustice.
6. Why is Section 17(1)(b) important?
It ensures arbitration remains effective, self-contained, and capable of protecting parties’ rights without excessive court interference.