Abstract
India is not perceived as an arbitration friendly jurisdiction. The main reason for this perception is the interventionist approach of the Indian courts. However, in recent years, the Indian Supreme Court has attempted to check this interventionism by delivering several pro-arbitration decisions. The Indian Parliament, perhaps taking a cue from the efforts of the Indian Supreme Court, has attempted to advance this agenda through the Arbitration and Conciliation (Amendment) Act, 2015. The amendments made by this legislation are largely applicable to domestic arbitrations, but there are certain amendments that are relevant to foreign arbitrations and the recognition and enforcement of foreign arbitral awards.
This report reviews the changes brought about by recent decisions of the Indian Supreme Court and the Arbitration and Conciliation (Amendment) Act, 2015 in the context of the New York Convention. It was initially researched and drafted in February 2015. However, because there was a substantial time gap between the drafting of this report and its publication, certain revisions became necessary, particularly after the promulgation of the Arbitration and Conciliation (Amendment) Ordinance, 2015 which was eventually replaced by the Arbitration and Conciliation (Amendment) Act, 2015. While efforts have been made to incorporate relevant legal developments since February 2015 through these revisions, it is possible that certain legal developments have not been considered in this report.
Ashutosh Kumar (LL.M. (Columbia Law School) & B.A., LL.B. (Hons.) (National Law School of India University)) is a dispute resolution lawyer practicing in India. He is qualified to practise law in India and in England & Wales. This report was researched and written during his time at Columbia Law School. He is currently an associate at S&R Associates, New Delhi.
Raina Upadhyay (LL.M. (Columbia Law School)) is currently an associate at AZB & Partners, Mumbai.
Anusha Jegadeesh (LL.M. (Columbia Law School)) is currently a Foreign Licensed Attorney at Gide Loyrette Nouel, Paris.
Yakshay Chheda (LL.M. (Columbia Law School)) is currently an Independent Practitioner at the Bombay High Court.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Similar content being viewed by others
Notes
- 1.
“Status – Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958)” www.uncitral.org/uncitral/en/uncitral_texts/arbitration/NYConvention_status.html.
- 2.
Chapter I of Part II of the ACA consists of Ss.44 to 52 of the ACA. The First Schedule of the ACA is the Convention itself. Chapter I of Part II of the ACA refers to the First Schedule of the ACA at different junctures.
- 3.
See above n 1.
- 4.
S.44(b) of the ACA.
- 5.
“Ministry of Law and Justice (Department of Legal Affairs), Notification dated 19 March 2012” www.egazette.nic.in/WriteReadData/2012/E_502_2012_018.pdf.
- 6.
“Kluwer Arbitration Blog – India gives Hong Kong a golden opportunity” www.kluwerarbitrationblog.com/blog/2012/04/25/india-gives-hong-kong-a-golden-opportunity.
- 7.
See above n 1.
- 8.
S.44 of the ACA.
- 9.
ibidem
- 10.
Part I of the ACA deals with domestic arbitration. S.31 of the ACA prescribes certain requirements in relation to the form and content of arbitral awards. However, these requirements apply to domestic arbitral awards only.
- 11.
McDermott International Inc v Burn Standard Co Ltd & Ors (2006) 11 SCC 181, paras 68 and 70.
- 12.
Raffles Design International India Private Limited & Anr v Educomp Professional Education Limited & Ors (2016) 234 DLT 349, para 103.
- 13.
Proviso to S.2(2) of the ACA.
- 14.
ibidem
- 15.
S.9 of the ACA. See above n 12 at paras 105 and 106.
- 16.
Ss.27(1) and 27(5) of the ACA. Please note that there are conflicting decisions on this issue. See Sri Krishan v Anand (2009) 3 Arb LR 447; MD, Army Welfare Housing Organisation v Sumangal Services (P) Ltd. (2004) 9 SCC 619; Alka Chandewar v Shamshul Ishrar Khan (2016) 1 Mah LJ 52.
- 17.
S.51 of the ACA.
- 18.
Ss.13 and 14 of the CPC.
- 19.
The relevant conditions include requirements such as – (i) the foreign judgment being pronounced by a court of competent jurisdiction, (ii) the foreign judgment being pronounced on the merits of the case, and (iii) the foreign judgment not being based on an incorrect view of international law or a refusal to recognize Indian law where applicable.
- 20.
Harendra H. Mehta & Ors v Mukesh H. Mehta & Ors (1999) 5 SCC 108, para 33.
- 21.
S.44A of the CPC. It should be noted that the direct enforcement of foreign judgments is subject to the same conditions applicable to suits based on foreign judgments.
- 22.
“Enforcement of judgments and arbitral awards in India: overview” uk.practicallaw.thomsonreuters.com/9-619-4568.
- 23.
Marina World Shipping Corporation Ltd v Jindal Exports Pvt Ltd 2007 (3) ArbLR 46 (Delhi), paras 28 and 29. However, a more recent decision of the Gujarat High Court holds that S.44A of the CPC can be availed to enforce a foreign judgment based on a foreign award. See M.V. Cape Climber v Glory Wealth Shipping Pvt. Ltd. 2015 SCC On Line Guj 956, para 69.
- 24.
Art. VII(2) of the Convention.
- 25.
Art. II(3) of the Convention reads as – “The court of a Contracting State, when seized of an action in a matter in respect of which the parties have made an agreement within the meaning of this article, shall, at the request of one of the parties, refer the parties to arbitration, unless it finds that the said agreement is null and void, inoperative or incapable of being performed.”
- 26.
S.45 of the ACA reads as – “Power of judicial authority to refer parties to arbitration: Notwithstanding anything contained in Part I or in the Code of Civil Procedure, 1908 (5 of 1908), a judicial authority, when seized of an action in a matter in respect of which the parties have made an agreement referred to in section 44, shall, at the request of one of the parties or any person claiming through or under him, refer the parties to arbitration, unless it finds that the said agreement is null and void, inoperative or incapable of being performed.”
- 27.
Chloro Controls (I) Pvt Ltd v Severn Trent Water Purification Inc & Ors. (2013) 1 SCC 641, para 130.
- 28.
Shin-Etsu Chemical Co Ltd v Aksh Optifibre Ltd & Anr (2005) 7 SCC 234, para 106.
- 29.
ibid at para 111.
- 30.
SBP & Co v Patel Engineering Ltd & Anr. (2005) 8 SCC 618.
- 31.
ibid at paras 38 and 47.
- 32.
See above n 27 at paras 127.2, 128 and 130.
- 33.
S.8(1) of the ACA.
- 34.
Enercon (India) Ltd & Ors v Enercon GmBH & Anr (2014) 5 SCC 1.
- 35.
World Sport Group (Mauritius) Ltd. v MSM Satellite (Singapore) Pte. Ltd. (2014) 11 SCC 639.
- 36.
See above n 34 at para 78.
- 37.
See above n 35 at paras 28, 32, 33 and 36.
- 38.
See Ramasamy Athappan v The Secretariat of the Court, International Chamber of Commerce (2009) 3 MadLJ 84; Ministry Of Sound International Ltd v Indus Renaissance Partners Entertainment Pvt Ltd (2009) 156 DLT 406 (Del).
- 39.
National Thermal Power Corporation v The Singer Company & Ors. (1992) 3 SCC 551, para 23.
- 40.
Bharat Aluminium Company v Kaiser Aluminium Technical Services, Inc (2012) 9 SCC 552.
- 41.
ibid at paras 114 and 115.
- 42.
See above n 27 at paras 126 and 130.
- 43.
National Insurance Co Ltd v Boghara Polyfab Pvt Ltd (2009) 1 SCC 267, para 22.
- 44.
See Angle Infrastructure Pvt Ltd v Capital Builders 2016 SCC OnLine Del 5621; Jindal Stainless Ltd v Damco India Pvt Ltd 2016 SCC OnLine Del 6368.
- 45.
Glencore Grain Rotterdam B.V. v Shivnath Rai Harnarain (India) Co. (2008) SCC OnLine Del 1271, para 40.
- 46.
Cruz City 1 Mauritius Holdings v Unitech Ltd (2017) SCC OnLine Del 7810, paras 26 and 28.
- 47.
International Investor KCSC (Kuwait), Kuwait v Sanghi Polyesters Ltd (2002) SCC OnLine AP 822, paras 40 and 41. However, in its recent decision in Cruz City, the Delhi High Court has taken a different position. ibid at paras 20, 21, 22, 23, 24 and 25.
- 48.
Shri Lal Mahal Ltd v Progetto Grano SpA (2014) 2 SCC 433, para 44.
- 49.
S.48(1)(a) of the ACA reads as – “Conditions for enforcement of foreign awards: (1) Enforcement of a foreign award may be refused, at the request of the party against whom it is invoked, only if that party furnishes to the court proof that—(a) the parties to the agreement referred to in section 44 were, under the law applicable to them, under some incapacity, or the said agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law of the country where the award was made.”
- 50.
Armada (Singapore) Pte Ltd v Ashapura Minechem Ltd (2015) SCC OnLine Bom 4783, para 40.
- 51.
Noble Resources Ltd v Twenty First Century Wire Roads Ltd (2015) SCC OnLine Bom 4677, para 33.
- 52.
Cinergy Corporation Pte Ltd v National Agricultural Co-operative Marketing Federation of India Ltd (2 012) SCC OnLine Del 4956, para 32.
- 53.
Coal India Ltd v Canadian Commercial Corporation MANU/WB/0105/2012, para 100.
- 54.
See section 2.1 of this Report.
- 55.
S.48(1)(b) of the ACA reads as – “Conditions for enforcement of foreign awards: (1) Enforcement of a foreign award may be refused, at the request of the party against whom it is invoked, only if that party furnishes to the court proof that—(b) the party against whom the award is invoked was not given proper notice of the appointment of the arbitrator or of the arbitral proceedings or was otherwise unable to present his case.”
- 56.
Centrotrade Minerals and Metal Inc v Hindustan Copper Ltd (2006) 11 SCC 245, paras 168 and 169.
- 57.
See above n 51 at paras 34, 35 and 36.
- 58.
SIMS Metal Management Ltd v Sabari Exim Pvt Ltd (2014) SCC OnLine Mad 9883, para 7.4.
- 59.
S.48(1)(c) of the ACA reads as – “Conditions for enforcement of foreign awards: (1) Enforcement of a foreign award may be refused, at the request of the party against whom it is invoked, only if that party furnishes to the court proof that—(c) the award deals with a difference not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration. Provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, that part of the award which contains decisions on matters submitted to arbitration may be enforced.”
- 60.
KTC Korea Co Ltd v Hobb International Pvt Ltd (2004) SCC OnLine Cal 179, paras 19 and 20.
- 61.
S.48(1)(d) of the ACA reads as – “Conditions for enforcement of foreign awards: (1) Enforcement of a foreign award may be refused, at the request of the party against whom it is invoked, only if that party furnishes to the court proof that—(d) the composition of the arbitral authority or the arbitral procedure was not in accordance with the agreement of the parties, or, failing such agreement, was not in accordance with the law of the country where the arbitration took place.”
- 62.
S.48(1)(e) of the ACA reads as – “Conditions for enforcement of foreign awards: (1) Enforcement of a foreign award may be refused, at the request of the party against whom it is invoked, only if that party furnishes to the court proof that—(e) the award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made.”
- 63.
See above n 40 at paras 136, 139, 143, 144 and 145.
- 64.
Naval Gent Maritime Ltd v Shivnath Rai Harnarain (I) Ltd (2009) SCC OnLine Del 2961, para 12.
- 65.
S.48(2)(a) of the ACA reads as – “Conditions for enforcement of foreign awards: (2) Enforcement of an arbitral award may also be refused if the court finds that—(a) the subject -matter of the difference is not capable of settlement by arbitration under the law of India.”
- 66.
G Born, International Arbitration: Law and Practice (Kluwer Law International, 2012) 82 noting that “Article II(1) of the Convention provides an exception to the presumptive obligation of Contracting States to recognize arbitration agreements. Under Article II(1), a state is not obligated to refer disputes to arbitration if they are not “capable of settlement by arbitration.” Similarly, Article V(2)(a) provides that an award need not be recognized if “[t]he subject matter of the difference is not capable of settlement by arbitration under the law” of the state where recognition is sought. Together, these provisions permit the assertion of non-arbitrability defenses to both arbitration agreements and awards under the Convention. Like the Convention, legislation in most states treats some categories of claims as incapable of resolution by arbitration… Virtually all states have provided, by legislation or judicial decisions, that certain categories of disputes are non-arbitrable: even if the parties have concluded a valid arbitration agreement, which extends to a dispute, the agreement will not be enforceable as applied to these “non-arbitrable” matters.”
- 67.
Booz Allen and Hamilton Inc v SBI Home Finance Ltd & Ors (2011) 5 SCC 532, para 34.
- 68.
ibid at para 46.
- 69.
See above n 67 at para 49.
- 70.
See above n 67 at para 48. It should be noted that a claim for specific performance of an agreement to sell can be decided by arbitration. See Olympus Superstructures Pvt Ltd. v. Meena Vijay Khetan and Ors (1999) 5 SCC 651.
- 71.
See above n 67 at paras 35, 36 and 38.
- 72.
See A. Ayyaswamy v A. Paramasivam (2016) 10 SCC 386.
- 73.
See Haryana Telecom Ltd v Sterlite Industries India Ltd (1999) 5 SCC 688.
- 74.
See Chiranjilal Shrilal Goenka v Jasjit Singh and Ors (1993) 2 SCC 507.
- 75.
See Vimal Kishor Shah v Jayesh Shah & Ors (2016) 8 SCC 788.
- 76.
See Rakesh Malhotra v Rajinder Kumar Malhotra (2016) SCC OnLine Bom 5759.
- 77.
See above n 67 at para 48.
- 78.
S.48(2)(b) of the ACA reads as – “Conditions for enforcement of foreign awards: (2) Enforcement of an arbitral award may also be refused if the court finds that—(b) the enforcement of the award would be contrary to the public policy of India.”
- 79.
Renusagar Power Co Ltd v General Electric Co (1994) Supp 1 SCC 644, para 66.
- 80.
It should be noted that although the decision of the Supreme Court in Renusagar Power Co. was never overruled, this decision was bypassed by litigants for several years through proceedings challenging foreign awards under S.34 of the ACA. This strategy became feasible after the decisions in Bhatia International v Bulk Trading SA & Anr AIR 2002 SC 1432 and Venture Global Engineering v Satyam Computer Services Ltd & Anr AIR 2008 SC 1061 (see section 5.1 of this Report).
- 81.
Oil & Natural Gas Corporation Ltd v SAW Pipes Ltd (2003) 5 SCC 705, para 31.
- 82.
Phulchand Exports Ltd v OOO Patriot (2011) 10 SCC 300, para 16.
- 83.
See above n 48 at paras 27, 28, 29 and 30.
- 84.
See above n 79 at para 76. However, in its recent decision in Cruz City, the Delhi High Court has taken a different position in respect of this proposition. See above n 46 at paras 101 to 110.
- 85.
See above n 48 at para 45.
- 86.
Explanation 1 to S.48(2)(b) of the ACA.
- 87.
Explanation 2 to S.48(2)(b) of the ACA.
- 88.
ONGC Ltd v Western Geco International Ltd (2014) 9 SCC 263.
- 89.
See above n 79 at para 63.
- 90.
See above n 48 at para 27.
- 91.
Explanation to S.47 of the ACA. The amended language is not materially different from the previous language. For this reason, prior case law interpreting the scope and meaning of the Explanation to S.47 of the ACA remains relevant.
- 92.
See Brace Transport Corporation of Monrovia and Bermuda v Orient Middle East Lines Ltd (1995) Supp 2 SCC 280, paras 16 to 19; Wireless Developers Inc v India Games Ltd (2012) SCC OnLine Bom 115, paras 8 and 9.
- 93.
India Games, ibid at paras 8, 11 and 12; Tata International Ltd v Trisuns Chemical Industry Ltd (2001) SCC OnLine Bom 905, para 6.
- 94.
Tata International Ltd, ibid at paras 6 and 7.
- 95.
See above n 40 at para 97.
- 96.
S.20(a) of the CPC reads as – “Other suits to be instituted where defendants reside or cause of action arises: Subject to the limitations aforesaid, every suit shall be instituted in a Court within the local limits of whose jurisdiction—(a) the defendant, or each of the defendants where there are more than one, at the time of the commencement of the suit, actually and voluntarily resides, or carries on business, or personally works for gain.”
- 97.
Noy Vallesina Engineering Spa v Jindal Drugs Ltd (2006) SCC OnLine Bom 545, paras 10 and 11.
- 98.
ibid at para 33.
- 99.
Louis Dreyfus Commodities Suisse SA v Sakuma Exports Ltd (2015) 6 Bom CR 258.
- 100.
Kerala State Electricity Board, Trivandrum v T.P. Kunhaliumma (1976) 4 SCC 364, para 22.
- 101.
Bhatia International, above n 80.
- 102.
Venture Global, above n 80.
- 103.
See A Anchayil, ‘Bhatia International to Videocon Industries and Yograj Infrastructure: Recasting the Foundations of Arbitration Law in India’ (2013) 29 Arbitration International 105.
- 104.
Oil & Natural Gas Corporation Ltd, above n 81.
- 105.
Phulchand Exports, above n 82.
- 106.
Renusagar Power Co, above n 79.
- 107.
Bharat Aluminium Company, above n 40.
- 108.
Chloro Controls, above n 27.
- 109.
Shri Lal Mahal, above n 48.
- 110.
Reliance Industries Ltd & Anr v Union of India (2014) 2 ArbLR 423 (SC).
- 111.
Union of India v Reliance Industries Limited & Ors (2015) 5 ArbLR 255 (SC).
- 112.
Centrotrade Minerals and Metal Inc v Hindustan Copper Limited (2017) 2 SCC 228.
- 113.
Pricol Ltd v Johnson Controls Enterprise Ltd (2014) 4 ArbLR 438 (SC).
REFERENCES
P C Markanda, N Markanda and R Markanda, Law Relating to Arbitration and Conciliation, 9th edn (India, LexisNexis India, 2016).
A Wadhwa and A Krishnan (eds), Justice R S Bachawat’s Law of Arbitration & Conciliation, 5th edn (India, LexisNexis India, 2010).
Law Commission of India, Report No. 246 on Amendments to the Arbitration and Conciliation Act, 1996 (along with Supplementary Report) (India, Ministry of Law and Justice, 2014 & 2015).
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2017 Springer International Publishing AG
About this chapter
Cite this chapter
Kumar, A., Upadhyay, R., Jegadeesh, A., Chheda, Y. (2017). Interpretation and Application of the New York Convention in India. In: Bermann, G. (eds) Recognition and Enforcement of Foreign Arbitral Awards. Ius Comparatum - Global Studies in Comparative Law, vol 23. Springer, Cham. https://doi.org/10.1007/978-3-319-50915-0_17
Download citation
DOI: https://doi.org/10.1007/978-3-319-50915-0_17
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-319-50913-6
Online ISBN: 978-3-319-50915-0
eBook Packages: Law and CriminologyLaw and Criminology (R0)