Arbitration referral under Section 8 cannot be used to restrain arbitral proceedings; impugned restraint order was set aside.

Section 8 of the Arbitration and Conciliation Act, 1996 is meant to refer parties to arbitration when a judicial proceeding is brought despite an arbitration agreement, not to restrain the commencement or continuation of arbitral proceedings. An application seeking to block arbitration could not properly be treated as one under Section 8 for the purpose of granting an injunction against arbitral proceedings. The lower courts proceeded on a ? avoid non-English. The impugned order was held unsustainable and was set aside, and the matter was remitted to the civil court to consider the application afresh in accordance with law.

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Issues: Whether Section 8 of the Arbitration and Conciliation Act, 1996 could be used to restrain arbitral proceedings and whether the impugned order granting such restraint was legally sustainable.

Analysis: Section 8 is designed to refer parties to arbitration when a judicial proceeding is brought despite an arbitration agreement, and not to interdict the commencement or continuation of arbitral proceedings. An application seeking to restrain arbitration could not, on that basis, be treated as one under Section 8 for the purpose of granting an injunction against arbitral proceedings. The proceedings below were therefore founded on a misconception of the statutory scheme, and the application had to be dealt with according to its true nature and the parties' rights under the arbitration agreement framework.

Conclusion: The impugned judgment was unsustainable and was set aside, with the matter remitted to the civil court to decide the application afresh in accordance with law.

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