Waiver of territorial jurisdiction objection and strict limits on Section 9 interim restraint in arbitration

A territorial jurisdiction objection under Section 21 CPC is waived when it is raised but not pressed before the trial court and cannot be revived in appeal absent failure of justice. Interim restraint under Section 9 of the Arbitration and Conciliation Act, 1996 must satisfy settled equitable principles, including a prima facie case and risk of irreparable injury. On the stated facts, continuing monthly receipts meant any eventual award could be met from recurring payments, so restraint of payment was not justified. The appeal succeeded because the jurisdiction objection was treated as waived and the requirements for interim prohibitory relief were not made out.

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Issues: (i) Whether the objection to jurisdiction could be raised in appeal after not being pressed before the single judge; (ii) whether the prohibitory order under Section 9 of the Arbitration and Conciliation Act, 1996 was justified on merits.

Issue (i): Whether the objection to jurisdiction could be raised in appeal after not being pressed before the single judge.

Analysis: A part of the cause of action arose within the territorial jurisdiction of the Court. The dispute was therefore competent to be entertained, and the objection related only to place of suing and the contractual jurisdiction clause. Under Section 21 of the Code of Civil Procedure, 1908, such an objection must be taken at the earliest possible opportunity and pursued before the trial court. Where a party raises the objection but does not press it and proceeds with the merits, the objection is treated as waived and cannot be revived in appeal in the absence of failure of justice.

Conclusion: The objection to jurisdiction was waived and could not be entertained in appeal.

Issue (ii): Whether the prohibitory order under Section 9 of the Arbitration and Conciliation Act, 1996 was justified on merits.

Analysis: Interim protection under Section 9 is governed by settled equitable principles akin to those underlying attachment before judgment and injunction. On the facts, the appellant had an ongoing power purchase arrangement under which substantial monthly payments continued to accrue, so any eventual arbitral award could be satisfied from the recurring receipts. In that setting, the respondent failed to establish a sufficient prima facie case or any real risk of irreparable injury warranting restraint of payments to the appellant.

Conclusion: The prohibitory order was not sustainable and had to be set aside.

Final Conclusion: The appeal succeeded because the jurisdictional objection was deemed waived and the requirements for interim restraint under Section 9 were not made out on the facts.

Ratio Decidendi: A territorial jurisdiction objection not pressed before the court of first instance is waived under Section 21 of the Code of Civil Procedure, 1908, and interim restraint under Section 9 of the Arbitration and Conciliation Act, 1996 cannot be granted absent a prima facie case and irreparable injury.

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