The High Court allowed the Civil Revision Petitions, setting aside orders of the Commercial Court and restoring Emaar Hills Township Private Limited and Emaar India Limited as parties to the arbitration-related proceedings.
The petitioner filed Section 9 applications under the Arbitration and Conciliation Act, 1996, seeking to restrain Respondent No.2 from alienating a disputed plot and preventing Emaar Hills and Emaar India from executing any sale deed in favour of Respondent No.2 pending arbitration. Emaar entities sought deletion from the party array by arguing that they were not signatories to the Memorandum of Understanding containing the arbitration clause.
The Commercial Court at Hyderabad allowed Emaar’s applications for deletion as parties, holding that they were not bound by the arbitration agreement. Aggrieved by this ruling, the petitioner filed Civil Revision Petitions under Article 227 of the Constitution against the impugned orders.
The case centres on a 531-acre integrated township project in Hyderabad developed by Emaar entities, with land allotted to Respondent No.2. The petitioner had financed 95% of the sale consideration for the plot based on an MOU with Respondent No.2 for sharing built-up area. Emaar Hills and Emaar India acknowledged receipt of the funds and executed the sale agreement for the disputed plot. The claim sought to preserve the property stake and prevent alienation while arbitration was pending.
The High Court Bench comprising Justice Moushumi Bhattacharya and Justice B.R. Madhusudhan Rao analysed whether the legislative bar in Section 8 of the Commercial Courts Act prohibited revision petitions under Article 227 and found that it did not. The bench distinguished between nomenclature and substance, referencing several precedents confirming the maintainability of CRPs under Article 227 even against Commercial Court orders.
The Court held that Emaar entities were intimately involved in the factual matrix, having received substantial payments and executed key agreements, making them necessary parties for a meaningful Section 9 relief. This is in line with the modern approach to arbitration, which allows interim reliefs not only against signatories, but also non-signatories, provided their conduct shows a proximate connection to the dispute.
The Court took note of the fact that Emaar Hills and Emaar India stood to benefit from the transaction and inferred that it linked them legally to the underlying arbitration agreement. It went on to observe that the Commercial Court’s action would have risked frustrations of the petitioner’s interest, as Emaar could alienate the property without being answerable.
Ultimately, the Court held that Section 9 relief may be directed against non-signatories with a live and substantial nexus to the arbitration agreement; and party status is determined by actual conduct and nexus, not mere signatures.
In result, the impugned orders dated 22.11.2023 deleting Emaar Hills and Emaar India from the array of parties were set aside, and both entities were restored as respondents for the purposes of the Section 9 arbitration application. All pending applications and interim orders stood closed and vacated.
Cases referred:
- V. Ramana Rao v. N. Subash, (2019) 4 ALT 13
- M/s.NCC Limited, formerly Nagarjuna Constructions Co., Ltd. v. National Institute of Technology, 2025 Supreme (Online) (TEL) 8599
- Shalini Shyam Shetty v. Rajendra Shankar Patil, (2010) 8 SCC 329
- Blue Cube Germany Assets GmbH and Co. KG Vs. Vivimed Labs Limited, 2019 (2) ALD 671
- P. Rama Rao Vs. National Highways Authority of India, 2024 SCC OnLine Del 7342
- Black Diamond Trackparts Pvt. Ltd. Vs. Black Diamond Motors Pvt. Ltd., (2021) SCC OnLine Del 3946
- Cox and Kings Limited v. SAP India Private Limited, (2024) 4 SCC 1
- Ajay Madhusudan Patel v. Jyotrindra S.Patel, (2025) 2 SCC 147
- Vijay Arvind Jariwala v. Umang Jatin Gandhi, AIR 2022 Guj 132
- Shone Sanil v. Coastal Foundations (P) Ltd., AIR 2006 Ker 206
- Kamal Gupta Vs. M/s. L.R. Builders Pvt. Ltd., 2025 INSC 975
Counsel for the Petitioner: Mr. T. Surya Satish
Counsel for the Respondent: Mr. Rajvinder Ahluwalia