Authority: Supreme Court of India

Order Date: 11-08-2026

Case Overview

  • Petitioners: IMC LIMITED; Respondents: STYRENIX PERFORMANCE MATERIALS LIMITED.
  • The dispute stems from a contract between the parties that was temporarily suspended; the respondent refused to resume performance when requested.
  • IMC invoked arbitration, resulting in an arbitral award. The respondent challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996; this challenge was dismissed at the admission stage by the learned Single Judge of the High Court of Bombay.
  • A subsequent challenge under Section 37 of the Arbitration Act led to an interim order by the Division Bench, which was later modified to permit the respondent to withdraw the entire sum deposited with the High Court upon furnishing a bank guarantee from a Nationalised Bank.
  • The petitioner subsequently withdrew the entire sum by furnishing a bank guarantee of the Union Bank of India in favour of the Prothonotary and Senior Master, High Court, Bombay.
  • The High Court allowed the Section 37 appeal and remanded the matter, observing that Force Majeure Clauses 41 and 43 of the contract had not been considered by the Single Judge and were the core issue.
  • The Division Bench directed that the bank guarantee be enforced and the amounts paid to the respondent.
  • On hearing senior counsel Mr. Gourab Banerji (for the petitioner) and Mr. Neeraj Kishan Kaul (for the respondent), the Supreme Court indicated that the money now held by the Prothonotary and Senior Master, High Court, Bombay should not be released to the respondent.
  • The Court suggested that, pending a fresh hearing before the Single Judge, the amount could be kept in an interest‑bearing account due to its substantial nature.

Final Outcome

  • The Supreme Court disposed of the Special Leave Petition without any observation on the merits of the dispute.
  • It ordered that the deposited sum remain with the High Court and not be released to the respondent until further directions are issued by the learned Single Judge.
  • All pending applications, if any, were also disposed of.

Topics: Arbitration, Contract Dispute