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Issues: Whether an interim injunction under Section 9 of the Arbitration and Conciliation Act, 1996 could be granted to restrain termination of agreements that were found to be determinable in nature, in view of the bar under the Specific Relief Act, 1963.
Analysis: The application for interim relief was sought to prevent enforcement of termination notices issued under technical collaboration agreements. The governing principles applied were that specific performance is unavailable for a contract which is in its nature determinable, and that an injunction cannot be granted to prevent breach of a contract whose performance cannot be specifically enforced. The Court held that the agreements were private commercial contracts terminable upon specified events and contained no negative covenant capable of attracting the exception under Section 42 of the Specific Relief Act, 1963. It further held that even if termination were ultimately found to be wrongful, the proper remedy would lie in damages or compensation, not in specific enforcement by injunction.
Conclusion: The injunction sought was barred by statute and the dismissal of the Section 9 application was .
Ratio Decidendi: A contract that is determinable in nature cannot be specifically enforced, and no interim injunction can be granted to restrain its termination unless the case falls within the narrow statutory exception relating to a negative covenant.
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