Delhi HC Reaffirms: Anti-Arbitration Injunctions Are Rare in Foreign-Seated Arbitrations

Delhi HC Reaffirms: Anti-Arbitration Injunctions Are Rare in Foreign-Seated Arbitrations

In a significant ruling, the Delhi High Court in SARR Freights Corporation & Anr. v. Argo Coral Maritime Ltd. has reiterated that anti-arbitration injunctions are an exceptional remedy, refusing to halt arbitration proceedings seated in London.

The dispute stemmed from a 2023 charterparty agreement concerning the transportation of UN peacekeeping cargo to Sudan. Following disruptions caused by conflict, disputes arose between the parties, leading to arbitration before the London Maritime Arbitrators Association (LMAA). The plaintiffs approached the Court alleging that the proceedings were vexatious, oppressive, and unsupported by a valid arbitration agreement.

BUT WHAT EXACTLY IS AN ANTI-ARBITRATION INJUNCTION?

It is an order by a court restraining a party from initiating or continuing arbitration proceedings. Unlike anti-suit injunctions, courts exercise this power very cautiously, as it directly interferes with party autonomy and the arbitral process. Such injunctions are granted only when:

• The arbitration agreement is prima facie invalid

• The proceedings are oppressive, vexatious, or abusive

• There is a clear lack of jurisdiction

The Court acknowledged that Indian civil courts retain jurisdiction under Section 9 CPC, even in foreign-seated arbitrations. However, it emphasized that this power must be exercised sparingly.

“In fact, the Court found no compelling evidence of oppression or lack of jurisdiction. It also observed that the arbitration agreement could be inferred from the broader contractual framework, including the Fixture Recap. Consequently, the request to restrain the London arbitration was denied.”

KEY TAKEAWAY:

This judgment strengthens India’s pro-arbitration stance—courts will not lightly interfere in foreign-seated arbitrations, unless there is clear abuse of process.

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