Narmada Hydroelectric Development vs M/s Harikaran Birla Govt Contractor

We have heard both sides. The respondentcontractor was engaged to do certain construction work for the appellantCorporation. Subsequently, the contract was terminated by the appellant. The matter was taken by the respondent u/s 9 of the Arbitration and Conciliation Act, 1996. Under that provision of law the Court below has, by the impugned order dated 2272011, issued an injunction against the appellant restraining it from allotting the work, which was subject matter of the contract between the parties, to any other contractor. This injunction which is obviously in aid of the arbitration, has been challenged in the present appeal. Since such injunction is permissible only in aid of the arbitration proceedings, it cannot be in excess of the final relief permissible in the arbitration.

The normal remedy for wrongful breach of contract is damages and not specific performance. Except in the specified cases provided under the Specific Relief Act, 1963, specific performance of contract cannot be granted. The present is not one of the cases covered by the said exceptions under Specific Relief Act, 1963. Therefore, even as final relief this contract is not capable of specific performance. Thus the only relief which can be given to the contractor at the end of the arbitration, if he is able to prove that the breach of the contract by the appellantcorporation is wrongful, would be damages.

In that view of the matter we are of the opinion that it was not permissible for the Court below to issue this kind of injunction order u/s 9 of the Arbitration and Conciliation Act, 1996.

Accordingly, this appeal is allowed. The impugned order is set aside.