New Delhi, Sep 14 (IANS): In a setback for Arcelor Mittal Nippon Steel India, the Supreme Court has allowed a commercial court to continue hearing in the steel major's dispute regarding cargo handling and payment with Essar Bulk Terminal.

Arcelor had opposed Essar Bulk Terminal's plea for arbitration, and had sought transfer of proceedings from the commercial court to an arbitration tribunal.

The company argued that an arbitral tribunal having been constituted, the commercial court cannot proceed further with the application under Section 9 of the Arbitration Act.

The top court, however, upheld Surat trial court's order by allowing conduct of arbitration proceedings under Section 9 in a commercial court.

The two-judge bench noted that Section 9(1) enables the parties to an arbitration agreement to approach the appropriate court for interim measures before the commencement of arbitral proceedings, during arbitral proceedings, or at any time after the making of an arbitral award but before it is enforced and in accordance with Section 36 of the Arbitration Act.

"The appeal is allowed only to the extent of clarifying that it shall not be necessary for the commercial court to consider the efficacy of relief under Section 17, since the application under Section 9 has already been entertained and considered by the commercial court. The judgment and order under appeal does not, otherwise, call for interference," the judgement said.

Arcelor Mittal Nippon Steel India moved the top court against the Gujarat High Court order which had refused to interfere with a Surat court order.

A commercial court in Surat had earlier dismissed its plea by refusing to shift all proceedings to the arbitral tribunal.

The case pertains to Essar Bulk Terminal's claim post Essar Steel's acquisition by ArcelorMittal under IBC, wherein Essar Bulk Terminal said that the Hazira port was not a part of the resolution process.