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Issues: Whether a civil court can grant an injunction restraining arbitral proceedings when the existence or validity of the arbitration agreement is challenged, in view of the arbitral tribunal's power to rule on its own jurisdiction under the Arbitration and Conciliation Act, 1996.
Analysis: Section 5 of the Arbitration and Conciliation Act, 1996 restricts judicial intervention, and Section 16 expressly empowers the arbitral tribunal to decide questions relating to its jurisdiction, including objections as to the existence or validity of the arbitration agreement. A combined reading of Section 16 and the provision for challenge under Section 34 shows that the tribunal must first decide such objections, and the civil court should not interdict arbitral proceedings by injunction on that ground.
Conclusion: The civil court had no jurisdiction to injunct the arbitral proceedings on the plea that the arbitration agreement did not exist or was invalid. The refusal to interfere was upheld, and the objection to jurisdiction was left to be raised before the arbitral tribunal as a preliminary issue.
Ratio Decidendi: Where the arbitration statute confers on the arbitral tribunal the power to rule on its own jurisdiction, including objections to the existence or validity of the arbitration agreement, the civil court cannot restrain the arbitral process by injunction and the jurisdictional objection must be decided first by the tribunal.