Mandatory Injunctions U/S. 9 Arbitration Act Can Be Granted Only in Clear, Compelling & Exceptional Circumstances: Delhi High Court

The Delhi High Court observed that while section 9 of the Arbitration & Conciliation Act, 1996 empowers the Court to issue mandatory injunctions, the exercise of such discretion is conditioned upon clear, compelling, and exceptional circumstances, guided by the principles of balance of convenience, irreparable harm, and the requirement of what is “just and convenient.”

The High Court also observed that larger public interest in ensuring continuity of education far outweighs the contractual disagreements between the parties.

The Bench of Justice Jasmeet Singh observed, “The legislative intent behind section 9 is to enable the Court to preserve the subject matter of the arbitral dispute, and therefore its scope cannot be narrowly confined to prohibitory injunctions alone. At the same time, the grant of a mandatory injunction is an extraordinary relief which cannot be exercised in a routine manner. It is consistently held that such relief can only be granted when a strong prima facie case is made out, where withholding would result in greater injustice than granting. Thus, while section 9 empowers the Court to issue mandatory injunctions, the exercise of such discretion is conditioned upon clear, compelling, and exceptional circumstances, guided by the principles of balance of convenience, irreparable harm, and the requirement of what is just and convenient.”

Senior Advocate Jayant Mehta represented the Petitioners, while Advocate Manish Kumar represented the Respondent.

Case Brief

A Petition was filed under Section 9 of the Arbitration & Conciliation Act, 1996 seeking an interim order to stay the operations of a circular issued by the Rehabilitation Council of India (RCI), a a statutory body under the Ministry of Social Justice & Empowerment, Department of Empowerment of Persons with Disabilities.

The Petitioner was a company engaged in providing e-governance solutions and its bid to conduct All India Online Aptitude Test was accepted in 2022, wherein a Service Agreement was executed, assigning the responsibilities to the petitioner for online registration, exam scheduling, admit cards, question banks, conduct of exams, and declaration of results.

It was contended by the Petitioner that the approval for result declaration was not granted by the RCI, rather they issued the circular announcing the admission schedule and counselling. It was submitted that this unilateral action on part of RCI has bypassed the petitioner’s contractual role.

The Petitioner also submitted that the dispute was not merely a commercial dispute as the admission process impacts thousands of Specially abled candidates nationwide, whose education and development was directly affected if the academic session does not commence in a timely and orderly manner. It was also contended that if RCI’s action was allowed to proceed then the admission process would be conducted in a disorganized manner, causing undue distress and inconvenience to candidates.

It was contended by the Respondents that under the guise of the Petition, the Petitioner was in effect seeking a permanent and mandatory injunction, which was maintainable by way of filing a civil suit, and not by filing the said petition.

Court’s Observation

The Delhi High Court underscored that though the Petitioner did not specifically prayed for the mandatory injunction/specific performance but if the petition was read as a whole then the Petitioner was seeking to stall the counselling process.

While referring to judgments, the Court observed that the legislative intent behind section 9 is to enable the Court to preserve the subject matter of the arbitral dispute, and therefore its scope cannot be narrowly confined to prohibitory injunctions alone. It was also underscored that the Court was vested with wide powers to grant interim measures, including the grant of mandatory injunctions, if the facts and circumstances so demand.

The Court said, “Thus, while section 9 empowers the Court to issue mandatory injunctions, the exercise of such discretion is conditioned upon clear, compelling, and exceptional circumstances, guided by the principles of balance of convenience, irreparable harm, and the requirement of what is just and convenient.”

Subsequently, the High Court continued to consider the facts of the case and noted that all these steps were taken by the Petitioner and it was only the result which was to be declared by the Petitioner with the approval of the RCI which they never gave. The Court opined, “Despite the same, the respondent has suddenly taken unilateral decision by way of the impugned circular, which according to me, prima facie, seems to be arbitrary and malafide. The said unilateral action of the respondent not only raises serious questions of arbitrariness but also cries foul of fairness.”

The High Court also underscored that the RCI was unable to answer as to why the list prepared by the Petitioner was not accepted by the RCI and why there was delay in granting approval to the said list and observed that the Petitioner has made out a prima facie case in its favour.

While considering the question whether the balance of convenience lies in favour of the Petitioner or if the Petitioner would suffer irreparable harm and injury if the said circular was not stayed, the Bench said that nearly 48,000 specially abled candidates have registered for admission after a gap of two years.

“Their academic careers and future employability hinge upon the timely commencement of the 2025-26 session. I cannot permit a stalemate situation between the petitioner and respondent to indefinitely stall the counselling and admission process. The larger public interest in ensuring continuity of education far outweighs the contractual disagreements between the parties”, the Court observed.

The High Court held that the balance of convenience tilts heavily in favour of allowing the admission process to proceed in the interest of candidates, even if it means that the Petitioner’s contractual grievances are left to be resolved in arbitration. It was also observed that the Petitioner’s can be compensated monetarily, however, the specially abled candidates would suffer irretrievable harm if the admission exercise is indefinitely stalled even for a while.

Accordingly, the High Court observed that though Petitioner established a prima facie case but was not able to demonstrate that the balance of convenience in its favour and irreparable harm which cannot be compensated in terms of money.

Accordingly, the Petition was dismissed.

Cause Title: M/s ND Info Systems Pvt. Ltd. V. Rehabilitation Council Of India (Neutral Citation: 2025:DHC:8721)

Appearance:

Petitioner: Senior Advocate Jayant Mehta, Advocates Tanuj Khurana, Honey Jain, Ashish Batra, Om Shelat

Respondent: Advocate Manish Kumar

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