Analysis Of Sarr Freights Corporation And Anr. v. Argo Coral Maritime Ltd.: Anti-Arbitration Injunction - An Exception Or Right?

I. INTRODUCTION: 

The Arbitration landscape in India is ever evolving adjacent to the globally accepted principles of Arbitration law. One of such principles is the ‘Anti-Arbitration Injunction’ which is a court-granted injunction restraining parties or a Tribunal from commencing or continuing arbitration proceedings. It may be sought before, during, or after substantive hearings but prior to the final award.1 Recently, this issue was revisited and discussed by the Hon’ble High Court of Delhi in I.A. 30141/2025 as preferred by the Plaintiff, in Sarr Freights Corporation & Anr. v. Argo Coral Maritime Ltd. bearing case no. CS(OS) 868/2025 by a single judge bench of Hon’ble Ms. Justice Mini Pushkarna (“Judgement/Interim Application”). This article analyses the Judgement pertaining to grant of Anti-Arbitration Injunction in view of the rationale held by the Court and the tenors of the Arbitration and Conciliation Act, 1996 (“Arbitration Act”).  

II. Factual Matrix Of The Case: 

In the instant case, the Plaintiffs are SARR Freights Corporation and SARR Freights Limited, both of which are Indian companies whilst the Defendant, Argo Coral Maritime Ltd., is the owner of a vessel named MV Panthera J. The dispute stems from a Booking Note issued on 04.02.2023 (“Booking Note”) concerning a voyage charter of transport of military cargo from the Port of Nhava Sheva in Mumbai to the Port of Sudan in relation to the Defendant, who acted as agents of the vessel’s owners. It is pertinent to note that the Booking Note was executed for a voyage charter relating to shipment of military cargo for the United Nations Interim Security Force for Abyei (“UNISFA”).  

But in what can be described as a dramatic turn of events, an advisory was issued on 18.03.2023 which stated that all vessels passing through Sudan were unsafe because of which UN terminated its Purchase Order with the Plaintiffs citing Force Majeure provision, on 20.04.2023. But on the same day, the Defendant issued a note of readiness from the loading point and demanded a sum of USD 584,741.10 as dead freight charges. The Plaintiffs stood firm on their grounds regarding the termination of the booking note while on the other hand, the Defendant persisted in its demand. 

Afterwards, a Notice dated 27.07.2023 was served by the Defendant pursuant to Clause 43 of the Booking Note (“First Reference”) for commencing arbitration proceedings against Plaintiff No. 2 (SARR Freights Limited) before the London Maritime Arbitrators Association (“LMAA”). Following that, a Second Reference was issued by the Defendant against Plaintiff No. 1 (SARR Freights Corporation) with respect to the same Booking Note, for the same voyage and breach of contract (“Second Reference”). In view of this, the LMAA vide an order dated 26.03.2025, framed four preliminary issues for determination and directed that both references be heard concurrently. Consequently, the LMAA Arbitral Tribunal ruled a Partial Final Award dated 18.10.2025 in favor of dismissing the Plaintiffs’ objections on all four preliminary questions, but a co-arbitrator disagreed on Question No. 4, arguing that the arbitration invoked by the Defendant was invalid. 

Thus, the Plaintiffs instituted the present suit and application before the Hon’ble High Court of Delhi seeking, inter alia, a declaration and permanent injunction restraining the Defendant from continuing with the two parallel LMAA Arbitration Proceedings, together with a declaration that the Partial Final Award is null, void and of no legal effect.  

III. Contentions Raised By The Parties: 

A. Arguments Advanced By The Plaintiffs: 

Pertaining to the scope of this Article, the Plaintiffs advanced the following averments2: 

1. That the Court’s inherent powers under Section 151 of the CPC are competent to restrain foreign-seated arbitration and grant anti-arbitration injunctions in exceptional circumstances involving vexation, oppression or public policy considerations. 
2. That the Defendant’s conduct amounted to procedural oppression as he instituted parallel arbitral proceedings concerning the same cause of action, and attempted substitution of parties after a year from the time of institution, obtained Partial Award through rewriting of the main contract, and abandoned First Reference thereafter. 
3. Reliance was placed on the doctrine of contra proferentem to argue that any ambiguity in the standard form contract should be construed in favour of the Plaintiffs as non-draftsmen.  

B. Arguments Advanced By The Defendant: 

In response to the Plaintiffs’ averments, the relevant contentions raised by the Defendant3 are stated below: 

1. The Defendant argues that the validity of the Arbitration Clause is to be decided only by the Arbitral Tribunal pursuant to the Kompetenz-Kompetenz principle,4 while LMAA has already made its ruling on this matter. 
2. The invocation of two references was necessitated by the conduct of the Plaintiffs, and the Defendant’s actions were bona fide, without any intent to harass. 
3. The Defendant also contended that the Plaintiffs are barred by waiver, acquiescence and estoppel from seeking anti-arbitration relief, having participated in the arbitral proceedings for over two years. 
4. The Arbitration proceedings were said to be neither inoperative nor incapable of being performed within the meaning of Section 45 of the Arbitration Act.  

IV. Findings Of The Hon’ble High Court: 

The Hon’ble High Court of Delhi firstly held that it had the jurisdiction to entertain the present Interim Application and restricted the scope of its finding only to the question of granting an Anti-Interim Injunction in the ongoing proceedings before the LMAA. In view of the finding that there was a valid Arbitration Clause between the parties, it was held that the Anti-Interim Injunction is an exceptional remedy, granted only in the rarest of circumstances, where the arbitration is shown to be vexatious, oppressive and unconscionable.5  

It was also categorically held that if the arbitration agreement is prima facie found to be valid, the Courts will not enter into the question of validity of proceedings before the Arbitral Tribunal by placing reliance on Jinneng Clean Energy Technology Ltd. Versus SunEdison Energy Holding (Singapore) Pte Ltd. and Others.6 

The Hon’ble Court, by applying the principles underlying Section 45 of the Arbitration Act, observed that once a valid agreement and a valid arbitration clause had been established on a prima facie basis, the Court is bound to relegate the parties to arbitration unless the agreement is found to be null and void, inoperative or incapable of being performed, by relying on World Sport Group (Mauritius) Limited Versus MSM Satellite (Singapore) PTE. Limited.7  Since the agreement in the present case was already held to be valid and operative, the Court noted that these threshold conditions were not met, and thus such Anti-Interim Injunction cannot be granted.8  

As regards the commencement of two parallel references to Arbitrations before the LMAA, the Hon’ble Court noted the Defendant’s explanation that the Second Reference was necessitated by the conduct of the Plaintiffs and the identity confusion between Plaintiff No. 1 and Plaintiff No. 2, and that the Defendant now seeks to continue proceedings only against Plaintiff No. 1. The Court further observed that there was nothing to suggest that the Plaintiffs were not being given equal opportunities before the Tribunal, or that the proceedings were otherwise vexatious or oppressive. 

The Hon’ble Court further relied upon the decisions in Himachal Sorang Power Pvt. Ltd. v. NCC Infrastructure Holdings Ltd.9 and McDonald’s India Pvt. Ltd. v. Vikram Bakshi10 to reiterate that courts must be extremely circumspect and reluctant to thwart arbitration proceedings. In view of the doctrine of Kompetenz-Kompetenz as enshrined in Section 16 of the Arbitration Act it was held that having arrived at a prima facie finding of a valid arbitration clause, it could not adjudicate upon or sit in appeal over the jurisdiction of the LMAA.  

Lastly, the Hon’ble Court observed that the questions of vexation, oppression and unconscionability are mixed questions of fact and law, which would have to be established by the Plaintiffs through the leading of evidence at trial.11 Thus, the application for interim injunction, being I.A. 30141/2025, was dismissed with an observation that merits of the claims as raised by the Plaintiffs in the present suit shall be the subject matter of final adjudication, post the trial in the present suit and the suit was thus listed for further proceedings on 01.04.2026. 

V. Conclusion:  

That the present Judgement is a decisive step in delimiting the contours of granting an Anti-Interim Injunction and upholds the intention of the legislature in maintaining a non-interfering approach in any Arbitration proceeding, unless exceptional circumstances for grant of Anti-Interim Injunction are satisfied, primarily being that the proceedings itself are vexatious or oppressive or unconscionable. Upholding the sanctity of the Arbitration Agreement and the doctrine of Kompetenz-Kompetenz as enshrined in Section 16 of the Arbitration Act, it was rightly adjudicated in disposing the present Interim Application that when a party seeking Anti-Interim Injunction has failed to prima facie establish the exceptional circumstances for grant of such Injunction, the Court must exercise restraint, and this relief must be granted as a rarity and not a right.  

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