Sunfield Global Pte Limited v. Liberty Investments Private Limited

What happened

Sunfield Global Pte Limited, a Singapore company, supplied vegetable oils under six contracts of 1 October 2024 to 19 February 2025 for 11,500 metric tonnes to Liberty Investments Private Limited of Mumbai. It says that the respondent owes USD 66,92,500 as on 3 October 2025, which the respondent admitted in a communication of that date, and has not paid. It filed a petition under section 9 of the Arbitration and Conciliation Act, 1996 seeking a bank guarantee for that amount with interest and costs or, alternatively, an injunction against alienating a parcel of land with buildings at Village Karol, Mumbai, of about 7,409 square metres. A three-member tribunal under the rules of the Federation of Oils, Seeds and Fats Associations (FOSFA), seated in London, was constituted on 17 November 2025, before the petition was heard, and by a judgment of 8 January 2026 the Single Judge dismissed it. The respondent argued that the appellant had an efficacious remedy before the tribunal, that the relief would turn an unsecured claim into a secured one and was mala fide, and that an unsuccessful claimant should not seek a second bite from the court.

Questions before the court

• Is a section 9 petition filed before the constitution of a foreign-seated tribunal maintainable after the tribunal is constituted, and should security for an admitted money claim be ordered?

Why the court ruled this way

The appellant was entitled to file the petition, and it could not be faulted for the Court's failure to hear it before the tribunal was constituted (paragraph 13). Section 9(3) bars the Court once the tribunal is constituted unless circumstances exist which may not render the remedy under section 17 efficacious. The FOSFA rules and section 38 of the English Arbitration Act only empower the tribunal to give directions about property that is the subject of the dispute, such as its preservation or inspection, which is entirely different from an order to secure a monetary claim by restraining dealings with other property, so that the respondent's own plea that the relief was extraordinary supported the appellant (paragraphs 14–16). Not entertaining an application filed before the tribunal's constitution would render section 9 otiose, and the Supreme Court in Arcelor Mittal had held that the bar operates only where the application had not been entertained until the tribunal's constitution (paragraphs 18–19). The Court followed Norvic Shipping Asia, which held that a strong possibility of diminution of assets, more than bare suspicion, is enough and that the Section 17 remedy must be efficacious in fact (paragraphs 20–22). There is no provision for executing an interim order of a foreign tribunal in India, because section 13 of the Code of Civil Procedure speaks of foreign judgments after finality, so that the appellant would need three rounds of litigation, and the respondent had not shown that an interim order of the tribunal would be enforceable against its Indian assets (paragraphs 23 and 25). The appellant could not be ousted by the Court's delay when the relief would have been granted had the petition been heard promptly (paragraph 24). The Delhi decision in Ashwani Minda concerned a claimant who failed before the tribunal and then sought the same relief from the court, which was not the case here; the respondent had not shown any genuine dispute, and the strong prima facie case, balance of convenience and irreparable loss were in the appellant's favour (paragraphs 26–27).

Controlling point

Section 9 relief remains available after a foreign-seated tribunal is constituted if the remedy before it is not efficacious, and security for an admitted claim may be ordered where the petition was filed before the tribunal's constitution and the respondent shows no genuine defence.

Order and next steps

The appeal was allowed and the judgment of 8 January 2026 was set aside. The respondent must furnish a bank guarantee of a nationalised bank or a scheduled commercial bank for the appellant's claim of USD 66,92,500 with interest and costs, or its equivalent in rupees, to the satisfaction of the Prothonotary and Senior Master within two weeks. Until compliance, or if it cannot comply, the respondent is restrained from alienating or creating third-party rights, title or interest in the subject property until the arbitration proceedings are completed.

Practical implications

A foreign supplier with an admitted claim against an Indian buyer should file the section 9 petition before the arbitral tribunal is constituted and show why the tribunal's interim powers are not efficacious, for example because an interim order could not be enforced against the buyer's Indian assets. A buyer who has admitted the debt will find it hard to resist security on the ground of a later-constituted tribunal.

Limits of this ruling

• The findings are for interim relief under section 9 and do not decide the merits of the claim; the decision rests on an admitted debt, a petition filed before the tribunal was constituted, and the absence of an enforceable interim remedy before the foreign tribunal.