Arbitral interim relief: narrow interference under section 37 upheld for a reasoned protective order preserving disputed assets.

An interim protective direction under section 17 of the Arbitration and Conciliation Act, 1996, requiring a sum to be kept in a separate interest-bearing account to preserve the disputed partner's share, was upheld because it was based on the materials before the tribunal and was aimed at securing the subject matter pending arbitration. In an appeal under section 37, interference is narrow and the appellate court will not reappraise facts unless the discretion is perverse, unconscionable, or affected by jurisdictional infirmity. As the order was reasoned and within the tribunal's power to mould interim relief, it did not warrant interference and the appeal failed.

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Issues: Whether the interim order passed under section 17 of the Arbitration and Conciliation Act, 1996, directing the appellant to keep a sum in a separate interest-bearing account for preservation of the deceased partner's share, called for interference in an appeal under section 37 of the 1996 Act.

Analysis: The relief granted by the arbitral tribunal was traced to the materials before it showing the deceased partner's share in the LLP, the subsequent sale of flats, and the need to preserve the value of the claim pending arbitration. The direction was not treated as an award of money to the claimant but as an interim protective measure to secure the subject matter of the dispute. In an appeal under section 37 against an order under section 17, the scope of interference is narrow. The appellate court is not to reappraise facts as in a first appeal and should interfere only if the exercise of discretion is patently perverse, unconscionable, or suffers from jurisdictional infirmity. The order was found to be supported by reasons and by the tribunal's power to mould interim relief to protect the dispute from frustration during the pendency of arbitration.

Conclusion: The interim order did not warrant interference and was upheld.

Final Conclusion: The appeal against the arbitral tribunal's interim protective direction failed, and the proceedings were dismissed without costs.

Ratio Decidendi: In an appeal under section 37 against an interim measure granted under section 17 of the Arbitration and Conciliation Act, 1996, interference is justified only when the tribunal's discretion is shown to be perverse, jurisdictionally infirm, or otherwise plainly unconscionable; a reasoned protective order preserving the disputed asset will ordinarily stand.

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