ENFORECEMENT OF FOREIGN AWARDS
By Ranjan Kumar Rai September 27, 2019
SCOPE OF ENUIRY U/S 45 OF THE REFRENCES OF DIRPUTE TO ARBITRATION IN RESPECT OF COMMERCIAL DISPUTE AN INTERNATIONAL COMPANY AND INDIAN COMPNAY
Section 45 of the Act confines only to the question whether the Arbitration agreement “Null and void, inoperative or incapable or being performed” but does not extend examination of legality and validity of substantive contract of which arbitration agreement is part. Once it is found that arbitration agreement is a legal and valid agreement, capable of being performed by parties to the suit, court has no discretion but to pass an order referring the parties to arbitration in terms of the agreement. This is the directive of Supreme Court in Sasan Power Ltd Vs North American Coal corporation (India Pvt Ltd) (2016) 10 SCC 183-in this case the Hon’ble Supreme court again followed the proposition of laws as settled in Bhatia International Vs Balk Trading S.A.
SECTION 47 & 48 OF THE ARBITRATION AND CONCILIATION ACT, 1996
Enforcement of foreign award cannot be opposed on the ground of the filing of the suit for damages after unsuccessful filing a counter claim in the arbitration proceedings without such award. The Hon’ble Supreme court in the Govind Rubber Ltd. Vs Loids Dreyfus Commodities Asia Pvt. Ltd. 2015 (13) SCC 477- the supreme court in the said judgment approved the law as held in Astro Vencedor Compania Naviera SA Vs Mahanaftgmbh (1970) (2) Lawyers Report Page 267, Pauls Smith Ltd. Vs H & S International Holdings Inc (1991) (2) LLOyds Report Page 127 and also followed the law laid down in Cairncross Vs Lorimer, (1860) (7) NS 149 : (1843-60) All England Report Page 174” Saratchandra Dey Vs Gopal Chandra Laha (1891-92) 19 IA 203
The Hon’ble Supreme court before the recent amendment to Arbitration and Conciliation Act, 1996 has been pleased to hold that wider meaning given to expression “Public Policy of India occurring in section 34 (2) (b) (ii) in Saw Pipes case reported in (2003)(5) SCC 705 has no application to enforcement of foreign awards under section 48 (2) (b) of the Act.
Suit challenging foreign seated ICA agreement held to be not maintainable unless the court has come to a prima facie finding that the agreement is void or question must be left to the arbitrator to decide the same on kompetenz kompetenz principle- international chambers of commerce rules (1998). Chatterjee pertochem Co. Vs Haldia Petrochemicals Ltd (2014) (14) SCC 574
REVIEW OF FOREIGN AWARDS ON MERITS
The Hon’ble supreme court of India reaffirmed the law that Indian courts are not authorized to review foreign awards on merits. Once a foreign award has attained finality, there is no scope for a second look at the merits at the stage of enforcement of foreign awards:- Srilalmahal Ltd. Vs Progtto Grano Spa (2014) (2) SCC 433.