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CS Professional · Arbitration, Mediation and Conciliation · Arbitral Proceedings, Pleadings and Evidence

Meridian Textiles Ltd and Kaveri Exports are before an arbitral tribunal in Chennai over a disputed consignment of cotton bales. Meridian fears that the bales, which are the subject-matter of the arbitration agreement, will deteriorate and wants them sold and the proceeds preserved while the proceedings are pending. To whom may Meridian apply under section 17 for this relief?

Meridian may apply to the arbitral tribunal. Section 17 lets a party, during arbitral proceedings, seek interim measures such as preservation, interim custody or sale of goods that are the subject-matter of the arbitration agreement, so the tribunal itself can order the sale of the cotton bales.

  1. AThe arbitral tribunal, for the preservation, interim custody or sale of the goodsCorrect
  2. BOnly the High Court, because a tribunal cannot order sale of goods
  3. CThe Registrar of Companies, as the goods belong to a company
  4. DThe conciliator appointed by the parties

Explanation

Section 17(1)(ii)(a) allows a party, during the arbitral proceedings, to apply to the arbitral tribunal for the preservation, interim custody or sale of goods that are the subject-matter of the arbitration agreement. The option naming only the High Court is wrong because the tribunal has this power. The other two bodies have no role.

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