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Chapter 11: Recognition and Enforcement of Foreign and Domestic Arbitral Awards: Role of
National Courts

Document information
Authors: DushyantDave
Publication: Arbitration in India
Publication date: Jan 2021
Jurisdiction: India
Bibliographic Reference: Dushyant Dave, 'Chapter 11: Recognition and Enforcement of Foreign and Domestic Arbitral Awards: Role of
National Courts', in Dushyant Dave, Martin Hunter, et al. (eds), Arbitration in India, pp. 235 - 260
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including rights for text and data mining, AI training, and similar technologies.

Dushyant Dave

(*)

This Chapter seeks to provide an understanding of the jurisprudence surrounding the enforcement of foreign and domestic
arbitral awards. The Chapter reviews provisions and the meandering jurisprudence on enforcement under enactments issued
from 1899, under Parts I and II of the Arbitration and Conciliation Act, 1996, and the Amendment Acts of 2015 and 2019. Following a
discussion of the case law, the Chapter concludes with guidelines for counsel and recommendations for judges deciding on
enforcement of arbitral awards.

11.1 PREFACE
These proceedings certainly illustrate what was said by Mr Doyne, and what has been often stated before, ‘that the difficulties of a litigant in
India begin when he has obtained a Decree’ (1) (emphasis added).

This statement made by the Privy Council in 1872 is still true in respect of present-day award holders. The World Bank in its Report ‘Doing
Business 2020’ has ranked India at 63 out of 190 countries. (2) The study notices that enforcement of contracts in India takes 1,445 days at a
cost of 31% of the claim as against 589.6 days in OECD countries. South Asia’s average is 1,101.6 days. In quality of judicial process
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index (0-18) India scored 10.5. (3) These figures fully represent the status of recognition and enforcement of awards, foreign and domestic in
Indian courts. Enforcement of awards receives the same treatment in national courts. Recent efforts by the Parliament, national courts, and
the arbitration community have seen an endeavour to change the scenario.

This Chapter constitutes a careful review and analysis of the statutory scheme and the judicial approach for the enforcement of awards.

11.2 ENFORCEMENT OF DOMESTIC AWARDS

11.2.1 Evolution of Law

[Link] 1899 Arbitration Act
The legislative journey of arbitration in India started with the Indian Arbitration Act, 1899 (1899 Arbitration Act). Section 15 reads:

Award when filed to be enforceable as a decree

(1) An award on a submission, on being filed in the Court in accordance with the foregoing provisions, shall (unless the Court
remits it to the reconsideration of the arbitrators or umpire, or sets it aside) be enforceable as if it were a decree of the Court.

(2) An award may be conditional or in the alternative.

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In Ramshai v. Joylall the Calcutta High Court held that an award is a decree for the purpose of enforcing that award. (4) Thus, a final award
without actually being followed by a decree – as was later provided by Section 17 of the Arbitration Act, 1940 (1940 Arbitration Act) – could be
enforced, i.e. executed in the same manner as a decree. (5)

[Link] 1940 Arbitration Act

Under the 1940 Arbitration Act the award was required to be made a ruling of the court. Therefore, an arbitral award was followed by a
judgment, which was in turn followed by a decree. Section 17 reads:

Judgment in terms of award.

Where the Court sees no cause to remit the award or any of the matters referred to arbitration for reconsideration or to set aside
the award, the Court shall, after the time for making an application to set aside the award has expired, or such application having
been made, after refusing it, proceed to pronounce judgment according to the award, and upon the judgment so pronounced a
decree shall
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follow, and no appeal shall lie from such decree except on the ground that it is in excess of, or not otherwise in accordance with,
the award.

The arbitral proceedings and the award, as the case may be, commenced and made under the 1940 Arbitration Act continued to be governed
thereunder even after the coming into force of the Arbitration and Conciliation Act, 1996 (1996 Arbitration Act or Act). Section 85(2)(a) of the
1996 Arbitration Act provided a saving clause in this regard. (6) The Supreme Court has held that once the arbitral proceedings have
commenced, the right to be governed by the older legislation for enforcement is an accrued right and not merely an inchoate right. It has
held that it is not imperative for the right to have the award enforced under the older Act that some legal proceedings for its enforcement
must be pending under that Act at the time of the newer Act coming into force. (7)

[Link] 1996 Arbitration Act

[Link].1 Application and Scope

This Act was based on the UNCITRAL Model Law on International Commercial Arbitration (Model Law) and sought to consolidate and amend
the law relating to domestic arbitration, international commercial arbitration and enforcement of foreign arbitral awards. Two of the
objectives underlying this Act were:

(i) to minimise the supervisory role of courts in the arbitral process; and

(ii) to provide that every final arbitral award is enforced in the same manner as if it were a decree of the court.

Chapter VIII of the 1996 Arbitration applies to ‘finality and enforcement of arbitral awards’ and provides in Sections 35 and 36:

Finality of arbitral awards.

Subject to this Part an arbitral award shall be final and binding on the parties and persons claiming under them respectively.

Enforcement

(1) Where the time for making an application to set aside the arbitral award under section 34 has expired, or such application
having been made, it has been refused, the award shall be enforced under the Code of Civil Procedure, 1908 (5 of 1908), in the
same manner as if it were a decree of the court.

Section 36 of the 1996 Arbitration is a departure from the 1940 Arbitration Act and restores the position prevailing under the 1899 Arbitration
Act. Consequently, the award is no longer required to be made a ruling of the court. Under Section 36 of the
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1996 Arbitration Act, the award is enforceable without the court’s intervention once the time limit for challenge has expired or the challenge
having been made has failed.

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The Code of Civil Procedure, 1908 (CPC) which applies to India, except Jammu and Kashmir, and Nagaland, contains detailed provisions in
Sections 36 to 74 of Part II read with Order XXI thereto.

An award holder would have to wait for a period of three months after receiving the award prior to applying for enforcement and execution.
(8) The Supreme Court has clarified that this three-month time period under Section 34(3) of the 1996 Arbitration Act is not 90 days, but three

calendar months, (9) which view has been consistently followed, including in a recent judgment of the Delhi High Court. (10) The Supreme
Court has also clarified that the delivery of the award has to be on the party and delivery to its counsel does not commence the limitation
period under Section 34(3). (11) Said law has been applied consistently by High Courts. (12) The court may extend this time limit by 30 days if it
is satisfied that the applicant was prevented by sufficient cause from making the application within the period of three months. (13)

Section 36 of the 1996 Arbitration states that an arbitral award can be enforced only under two circumstances:

(1) after the time for filing an application under Section 34 has expired and no application is made, or

(2) such application having been made has been refused.

Refusal as contemplated in Section 36 relates to refusal by the Court of First Instance and not by the appellate court. (14)

In Union of India v. Popular Construction Co. the Supreme Court held that by virtue of Section 34(1) of the 1996 Arbitration Act, recourse to
the court against an arbitral award cannot be made beyond the period prescribed. (15) The importance of the period fixed under Section 34 is
emphasised by the provisions of Section 36. This is a significant departure from the provisions of the 1940 Arbitration Act. Under the 1940
Arbitration Act, after the time to set aside the award expired, the court was required to ‘proceed to pronounce judgment according to the
award’ and upon the judgment so pronounced a decree shall follow. The consequence of the time expiring under Section 34 of the 1996
Arbitration Act is that the award becomes immediately enforceable without any further act of the court.
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[Link].2 Scheme and Implementation of the 1996 Arbitration Act

Subsection 2 of Section 2 of the 1996 Arbitration Act provides: ‘This part shall apply where the place of arbitration is in India.’ Thus, both
domestic and international commercial arbitrations, with a seat in India, were governed by Part I of the Act. (16) Said provision was
interpreted by a Constitution Bench of the Supreme Court in Bharat Aluminium Company v. Kaiser Aluminium Technical Services wherein it
was held that the provisions of Part I of the Act cannot be invoked in case of a foreign-seated arbitration, i.e. an arbitration having its seat
outside of India. In other words, the judgment expressly recognised that the Act contemplates a localised arbitration regime. (17)

Between 1996 and 2016 – when the Act was amended by the Arbitration and Conciliation (Amendment) Act, 2015 (2015 Amendment) –
recognition and enforcement of awards made in India proved to be difficult, time-consuming and costly. (18) For example, an application for
setting aside under Section 34 would tantamount to a stay on the proceedings for execution, thereby delaying enforcement.

National courts contributed to this situation by a series of judgments which expanded the scope of review under Section 34: In Saw Pipes
Ltd, the Supreme Court expanded the expression ‘public policy of India’ in Section 34(2)(b) to include ‘patent illegality’. (19) As a result,
virtually every award, domestic or foreign, came to be challenged within the meaning of Section 34. Subsequently, the Supreme Court
imported principles of administrative law and the Wednesbury principle of unreasonableness to sustain a challenge against an arbitral
award – as per Wednesbury – a decision is unreasonable if no reasonable person acting reasonably could have made it. (20) Proceedings
before national courts in India are time-consuming. (21) It was not
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uncommon for challenges to consume a decade or more to be decided finally by the Supreme Court. (22)

While such challenges are pending, the awards were unenforceable in any manner by virtue of Section 36 of the 1996 Arbitration Act which by
its language indicates that a set-aside application would be tantamount to a stay on enforcement. Before the first instance court, there
would be an automatic stay while in the appeal courts often awards would be stayed for various reasons, which were outside the dispute
resolution jurisprudence (e.g., Khaleel Ahmed Dakhani v. Hatti Gold Mines). (23) While granting such an order of stay, the courts even took the
position that the award holder was not in a position to secure the award and the losing party did not have to furnish a bank guarantee
against the award. (24) The principle behind the grant of stay by the appellate court, i.e. the court exercising jurisdiction under Section 37 of
the Act and while entertaining the challenge against the order passed by the first instance court under Section 34 of the Act, was ultimately
confirmed by the Supreme Court. (25)

The Supreme Court, while dealing with the challenge to the award in the first instance court, in 2004 held in National Aluminium Co. Ltd. that
the award would be automatically stayed. It also noted that the automatic stay would result in no discretion for the courts and this would

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‘defeat the very objective of the alternate dispute resolution system to which arbitration belongs’. (26) It noted that a recommendation was
made by the concerned Ministry to the Parliament to amend Section 34 of the 1996 Arbitration Act and expressed its hope that necessary
steps would be taken by the authorities at the earliest to bring about the ‘required’ change in law. (27)

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Although the 1996 Arbitration Act equated an award with a deemed decree, (28) in practice the scheme of the Act prevented immediate
enforcement.

The Supreme Court in, 2015, Associate Builders clarified the anomaly created by Saw Pipes:

It must clearly be understood that when a court is applying the ‘public policy’ test to an arbitration award, it does not act as a
court of appeal and consequently errors of fact cannot be corrected. A possible view by the arbitrator on facts has necessarily to
pass muster as the arbitrator is the ultimate master of the quantity and quality of evidence to be relied upon when he delivers his
arbitral award. Thus an award based on little evidence or on evidence which does not measure up in quality to a trained legal
mind would not be held to be invalid on this score. (29)

It also narrowly construed the expressions ‘interests of India’, ‘justice’, ‘morality’ and ‘patent illegality’ and has watered down the
interpretations placed in the Saw Pipes and Western Geco cases. (30)

At the same time, the Supreme Court in the Fiza Developers case (31) rendered two crucial interpretations on the scope of Section 34 of the
Act. It first interpreted the term ‘the court finds that’ in Section 34(2)(b), to mean that the court on its own initiative (i.e., sua sponte) may
examine the award to find out whether it is liable to be set aside on either of the two grounds mentioned in the said provision. It even holds
this power if the applicant does not rely upon said grounds, with one of them being the public policy of India.

Said judgment further interpreted the term ‘furnished proof that’ in Section 34(2)(a) of the Act to mean that the applicant who has preferred
an application under Section 34 of the Act is permitted to file affidavits of the witness in proof of the existence of any ground under Section
34(2), and where the case so warrants, the court can permit a cross-examination of the person. The judgment nevertheless clarified that the
framing of the issues as contemplated in the CPC is not an integral part of the proceedings under Section 34 of the Act. This view was
subsequently explained and made limited vis-à-vis the scope of the investigation under Section 34(2) by the Supreme Court in another
judgment in Emkay Global Financial Services Ltd. v. Girdhar Sondhi (2018) 9 SCC 49 by holding that only if there are matters not contained in
arbitration records and are relevant to the determination of issues arising under Section 34(2)(a), then the same can be brought on record by
way of an affidavit.
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[Link] 2015 Amendment

Parliament has stepped in with curative amendments to the 1996 Arbitration Act, particularly in respect of the recognition and enforcement
of awards. The hope expressed by the Supreme Court in 2004 saw fruition with legislative amendments in 2015. (32) The Parliament in its
Statement of Objects and Reasons for the Amending Act:

1. The Act was enacted to provide for speedy disposal of cases relating to arbitration with least court intervention. With the
passage of time, some difficulties in the applicability of the Act have been noticed. Interpretation of the provisions of the Act
by courts in some cases have resulted in delay of disposal of arbitration proceedings and increase in interference of courts in
arbitration matters, which tend to defeat the object of the Act […]

[…]

4. As India has been ranked at 178 out of 189 nations in the world in contract enforcement, it is high time that urgent steps are
taken to facilitate quick enforcement of contracts, easy recovery of monetary claims and award of just compensation for
damages suffered and reduce the pendency of cases in courts and hasten the process of dispute resolution through
arbitration, so as to encourage investment and economic activity. (33)

Under the scheme of the 1996 Arbitration Act, during and after the award was rendered and up until the decision rendered in any challenge
proceedings like a setting aside procedure – including procedures relating to interim measures – the court having original civil jurisdiction to
decide the questions forming the subject matter of the arbitration would have jurisdiction if the same had been subject matter of a suit.
After the 2015 Amendment, in respect of international commercial arbitration, the supervisory jurisdiction of the court vests in the High
Court having original jurisdiction or the High Court having supervisory jurisdiction over the court of original jurisdiction. This provision thus
recognises the need for a superior court – like a High Court – to have control during and after the arbitral process up to examining the
challenge against the award.

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Section 34 has been amended to override the decision in Saw Pipes by inserting Explanations in clause (b) of subsection (2):

Explanation 1. – For the avoidance of any doubt, it is clarified that an award is in conflict with the public policy of India, only if, –

(i) the making of the award was induced or affected by fraud or corruption or was in violation of section 75 or section 81; or

(ii) it is in contravention with the fundamental policy of Indian law; or

(iii) it is in conflict with the most basic notions of morality or justice.

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Explanation 2. – For the avoidance of doubt, the test as to whether there is a contravention with the fundamental policy of Indian
law shall not entail a review on the merits of the dispute.

However, Subsection (2A) has been inserted in Section 34 in the following terms:

An arbitral award arising out of arbitrations other than international commercial arbitrations, may also be set aside by the Court,
if the Court finds that the award is vitiated by patent illegality appearing on the face of the award: Provided that an award shall
not be set aside merely on the ground of an erroneous application of the law or by reappreciation of evidence.

Thus, the 2015 Amendment introduced two regimes qua scope of interference under Section 34 of the Act, namely: i) domestic arbitral award
arising out of arbitrations other than international commercial arbitration; and ii) domestic arbitral award arising out of international
commercial arbitrations, as defined in Section 2(1)(f) of the Act. In the first category, the scope of public policy of India post the 2015
Amendment included three species: i) the fundamental policy of Indian law; ii) the basic notions of morality or justice; and iii) patent
illegality appearing on the face of the award. In the second category only the first two species were available as grounds of challenge based
on the public policy of India.

Two other very interesting facets emerged from the aforesaid amendment to Section 34 of the Act. First, in the case of international
commercial arbitration awards, the scope of public policy of India, for the present annulment proceedings, has been made identical to the
scope of public policy of India for the purpose of resisting an enforcement of foreign awards under Section 48 of the Act. Second, in case of
non-international commercial arbitration awards, even though the ground of patent illegality has been retained, but then, the scope of
investigation for said purpose has been curtailed inasmuch as: i) the patent illegality has to appear on the face of the award; ii) the patent
illegality will not cover a case of erroneous application of law; or iii) will not permit a re-appreciation of evidence. Significantly, the other
original species of public policy of India, namely ‘interests of India’, has been done away with completely and the species, ‘morality or
justice’, as was available under the original scope of public policy, has also been curtailed by addition of a prefix, namely ‘basic notions of’.
(34)

The aforesaid amendment to Section 34 of the Act indisputably has narrowed down the scope of challenges in annulment proceedings. (35)
Hence, even though Explanation 1 as well as Explanation 2 as introduced in said provision by the amendment use the expression ‘avoidance
of doubt’ or for that matter ‘it is clarified’, the said nomenclatures by themselves do not make the said explanation retrospective
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in operation. In other words, the operation of the amendment will clearly be prospective, (36) and therefore the restricted / narrowed down
version of public policy of India as brought in through the 2015 Amendment would not apply to those annulment proceedings, which were
pending when the amendment was brought into force.

Simultaneously, Section 34 providing for a challenge to an arbitral award has also been amended and the following two subsections have
inter alia been inserted:

(5) An application under this section shall be filed by a party only after issuing a prior notice to the other party and such
application shall be accompanied by an affidavit by the applicant endorsing compliance with the said requirement.

(6) An application under this section shall be disposed of expeditiously, and in any event, within a period of one year from the
date on which the notice referred to in sub-section (5) is served upon the other party.

Thus, notice to the other side and time limit of a period not exceeding one year has been prescribed.

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While some High Courts took the view that subsection 5 and subsection 6 were directory in nature, other High Courts took the view that the
same were mandatory in nature. Ultimately, the Supreme Court in State of Bihar v. Bihar Rajya Bhumi Vikas Bank Samiti - (2018) 9 SCC 472
held said provisions to be directory and not mandatory.

Section 36 has been amended, and subsections (2) and (3) thereof provide a solution to successful award holders pending challenges:

(2) Where an application to set aside the arbitral award has been filed in the Court under section 34, the filing of such an
application shall not by itself render that award unenforceable, unless the Court grants an order of stay of the operation of
the said arbitral award in accordance with the provisions of sub-section (3), on a separate application made for that purpose.

(3) Upon filing of an application under sub-section (2) for stay of the operation of the arbitral award, the Court may, subject to
such conditions as it may deem fit, grant stay of the operation of such award for reasons to be recorded in writing: provided
that the Court shall, while considering the application for grant of stay in the case of an arbitral award for payment of money,
have due regard to the provisions for grant of stay of a money decree under the provisions of the Code of Civil Procedure,
1908 (5 of 1908).

The twofold protection provides a vital life to enforcement. On the one hand, the time limit for the challenge has been restricted and, on the
other, even pending such restricted challenge the losing party has to honour the award unless stayed by an express order of the court. For
this purpose, if the award is for payment of money, then provisions of the CPC for grant of stay of a money decree must apply. Under the CPC
appellate court may grant stay of execution of a decree if the court is satisfied that:

(a) substantial loss may result to the party applying for stay of execution unless the order is made;

(b) the application has been made without unreasonable delay; and

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(c) security has been given by the applicant for the due performance of such decree or order as may ultimately be binding upon him. (37)

Pertinently, the term ‘having due regard to the provisions for grant of stay of a money decree under provisions of the Code of Civil Procedure,
1908’, as brought in through the amendment in the form of proviso to subsection 3 of Section 36, has been interpreted by the Supreme Court
in Pam Developments Pvt. Ltd. v. State of West Bengal (2019) 4 ArLR 148 (SC), to mean that the provisions of CPC are to be taken into account
for the purpose of a grant of stay and not that the provisions of CPC are mandatory.

The 2015 Amendment came into effect on 23 October 2015. Section 26 of that Act states:

Nothing contained in this Act shall apply to the arbitral proceedings commenced, in accordance with the provisions of section 21
of the principal Act, before the commencement of this Act unless the parties otherwise agree but this Act shall apply in relation to
arbitral proceedings commenced on or after the date of commencement of this Act.

Yet, controversy has occurred in courts about the applicability of the 2015 Amendment. While the High Courts of Bombay (38) and Madras (39)
have taken the view that the Act would apply to pending challenge against an arbitral award under Section 34, the Delhi High Court has taken
a contrary view. (40) The controversy has now been settled by the Supreme Court in Board of Control for Cricket in India v. Kochi Cricket Pvt.
Ltd. (2018) 6 SCC 287. (41)

There have been few instances of hope provided by the Supreme Court in McDermott International Inc. v. Burn Standard Co. Ltd., (42)
Sumitomo Heavy Industries Ltd. v. ONGC Ltd. (43) and SAIL v. Gupta Brother Steel Tubes Ltd., (44) recognising and enforcing awards in the spirit
of the Act of 1996. The recent trend seems to be to grant stay subject to the condition of furnishing security of the value of 75% of the award
amount, (45) which deposit sometimes is of 50% of the award amount. (46) But, in some
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cases depending upon the merit of the challenge, even unconditional stay has been granted. (47)

[Link] Arbitration and Conciliation (Amendment) Act, 2019 (2019 Amendment)

The 2015 Amendment made changes to the Act with a view of making arbitration speedier and more efficient, and improving India’s
reputation as a seat of arbitration. However, there were certain areas where the changes brought about by the 2015 Amendment needed
clarification. Additionally, certain issues, which the 2015 Amendment had failed to address, were also required to be done, particularly to

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improve India’s perception as a seat of arbitration. Accordingly, the present Amendment made amendments in the annulment provision
(Section 34), appellate provision (Section 37), as well as sought to clarify the operation / applicability of the 2015 Amendment. (48)

The 2019 Amendment was published in the official gazette on 9 August 2019. It provided for different provisions of the Amendment Act to
come into force on such different dates. Such dates would be notified by the central government in the official gazette. Apart from some
other provisions of the 2019 Amendment, the provisions dealing with annulment (Section 34); the appellate provision (Section 37 & Section
50) and a new provision, namely Section 87, inserted through Section 13 of the Amendment Act together with Section 15 of the Amendment
Act omitting Section 26 of the Amendment Act, 2015, were notified for the same to be brought into force on 30 August 2019.

In Section 34(2)(a) the words ‘furnishes proof that’ were replaced by the words ‘establishes on the basis of the record of the Arbitral Tribunal
that’. This amendment was made as the requirement of ‘furnishing of proof’ had led to inconsistent practices in some High Courts where
Section 34 proceedings were being conducted in the manner as that of a regular civil suit. (49)

In Section 37 and Section 50 of the Act, the very initial words in the provision, i.e. ‘An appeal’, were substituted by the words ‘Notwithstanding
anything contained in any other law for the time being in force and appeal’. The amendment was effected as it was felt that there was
inconsistency between the appellate provisions and Section 13(1) of the Commercial Courts Act, 2015 insofar as the latter provided for a
wider right of appeal than that provided by the former provision under the Act. (50) In fact, in a judgment, (51) a Division Bench of the Delhi
High Court held that appeal in terms of
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Section 13 of the Commercial Courts Act would lie in respect of a declaration made by one court about the lack of jurisdiction of another
court, even though the order containing such declaration was not one of the appealable orders enumerated in Section 37 of the Act. This
judgment was one such instance of interplay between Section 37 of the Act and Section 13(1) of the Commercial Courts Act, which was
responsible for creating confusion about the wider scope of the right of appeal under Section 13(1) of the Commercial Courts Act.

Insofar as the aforesaid Sections 13 and 15 of the Amendment Act of 2019 were concerned, said provisions have effectively been set aside. (52)

11.3 ENFORCEMENT OF FOREIGN AWARDS

11.3.1 Evolution of Law

Statutory frameworks have existed in India for over seven decades to provide for recognition and enforcement of foreign awards, and
therefore it is helpful to have a brief review.

11.3.2 The 1937 Arbitration Act

The Arbitration (Protocol & Convention) Act 1937 (1937 Arbitration Act) was enacted to give effect to the 1923 Protocol on Arbitration Clauses
and to the 1927 Convention on the Execution of Foreign Arbitral Awards signed by India. Section 4 of the 1937 Arbitration dealt with ‘effect of
foreign awards’ in Subsection (1):

A foreign award shall, subject to the provisions of this Act, be enforceable in India as if it were an award made on a matter
referred to arbitration in India.

Section 6 of the 1937 Arbitration dealt with ‘enforcement of foreign award’:

(1) Where the Court is satisfied that the foreign award is enforceable under this Act, the Court shall order the award to be filed
and shall proceed to pronounce judgment according to the award.

(2) Upon the judgment so pronounced a decree shall follow, and no appeal shall lie from such decree except in so far as the
decree in excess of or not in accordance with award.

Section 7 of the 1937 Arbitration dealt with ‘conditions for enforcement of foreign awards’. In Francesco Corsi the Bombay High Court held:

India being a State signatory to the Protocol on Arbitration Clauses set forth in the First Schedule to the Arbitration (Protocol and
Convention) Act, 1937, and to the Convention on the Execution of Foreign Arbitral Awards set forth in the second
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Schedule to that Act, the obligations undertaken thereunder continue to bind India after India was constituted a Dominion and
they continue to bind India thereafter. The Arbitration (Protocol and Convention) Act, 1937, has been duly passed by Indian

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legislature and I am bound to give effect to its provisions. It has not been shown how the said Act has ceased to be in force after
26-1-1950. Issue No. 1 is answered in the affirmative.

The court was unhesitant in enforcing an award made by the London Oil and Tallow Trade Association. (53)

The Supreme Court in its 1959 judgment in Shiva Jute Baling Ltd similarly enforced an award made by the London Jute Association rejecting
the contention that the award could not be made after the Indian party had filed proceedings under Section 33 of 1940 Arbitration Act before
an Indian court and that the award was unenforceable for being contrary to the laws of India since the arbitrators could not award damages
which could not be awarded under the Indian Contract Act, 1872. The court held that the arbitrators could only award the maximum amount
named in the contract. (54)

11.3.3 The 1961 Foreign Awards Act

The Foreign Awards (Recognition & Enforcement) Act, 1961 (1961 Foreign Awards Act) repealed the 1937 Arbitration Act and was enacted to give
effect to the 1958 Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention). Section 4 dealt with
‘effect of foreign awards’:

(1) A foreign award shall, subject to the provisions of this Act, be enforceable in India as if it were an award made on a matter
referred to arbitration in India.

(2) Any foreign award which would be enforceable under this Act shall be treated as binding for all purposes on the persons as
between whom it was made, and may accordingly be relied on by any of those persons by way of defence, set off or
otherwise in any legal proceedings in India and any references in this Act to enforcing a foreign award shall be construed as
including references to relying on an award.

Section 6 of the 1961 Foreign Awards Act dealt with ‘enforcement of a foreign award’:

(1) Where the Court is satisfied that the foreign award is enforceable under this Act, the court shall order the award to be filed
and shall proceed to pronounce judgment according to the award.

(2) Upon the judgment so pronounced a decree shall follow, and no appeal shall lie from such decree except in so far as the
decree is in excess of or not in accordance with the award.

Section 3 of the 1961 Foreign Awards Act had a unique provision to stay legal proceedings in any court commenced by any person in respect
of subject matter of the arbitration agreement and required the court to stay such legal proceedings unless it
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was satisfied that the agreement is null and void, inoperative or incapable of being performed or that there is not, in fact, any dispute
between the parties with regard to the matter agreed to be referred. Thus, far from anti-arbitration injunction, Section 3 spoke of staying
legal proceedings in a court.

In 1969, the Supreme Court in V.O. Tractoroexport affirmed an anti-arbitration injunction granted by the Madras High Court restraining a
Russian firm from proceeding with arbitration in Moscow under the aegis of the Foreign Trade Arbitration Commission of the USSR Chamber
of Commerce. (55) The Madras High Court had simultaneously refused an application under Section 3 by the Russian firm. The judgment,
besides merits, gave an additional and a very curious reason for the injunction observing:

the current restrictions imposed by the Government of India on the availability of foreign exchange of which judicial notice can be
taken will make it virtually impossible for the Indian Firm to take its witnesses to Moscow for examination before the Arbitral
Tribunal and to otherwise properly conduct the proceedings there. Thus, the proceedings before that tribunal are likely to be in
effect ex parte. The High Court was, therefore, right in exercising discretion in the matter of granting an interim injunction in
favour of the Indian Firm.

However, in a powerful dissent, Justice Ramaswami disagreed with the majority and vacated the injunction by holding:

the appellant is entitled under Section 3 of the Act for an order of stay of the proceedings in CS 118 of 1967 pending in the Madras
High Court on the ground that in terms of the Contract dated 2 February 1965 the parties expressly agreed that all disputes arising
out of the contract should be settled by arbitration by the Foreign Trade Arbitration Commission of the U.S.S.R. Chamber of
Commerce in Moscow.

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In 1984, the Supreme Court in Renusagar reversed this legal position. It stayed the suit and allowed the arbitration to move forward. It
interpreted Section 3 of the 1961 Foreign Awards Act as:

On a plain reading of the section as it now stands two things become very clear. In the first place the section opens with a non
obstante clause giving overriding effect to the provision contained therein and making it prevail over anything to the contrary
contained in the Arbitration Act, 1940 or the Code of Civil Procedure, 1908. Secondly, unlike Section 34 of the Arbitration Act which
confers a discretion upon the court, the section uses the mandatory expression ‘shall’ and makes it obligatory upon the court to
pass the order staying the legal proceedings commenced by a party to the agreement if the conditions specified therein are
fulfilled. (56)

The court observed: ‘[i]t is obvious that since the Act is calculated and designed to subserve the cause of facilitating international trade and
promotion thereof by providing for speedy settlement of disputes arising in such trade through arbitration,
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any expression or phrase occurring therein should receive, consistent with its literal and grammatical sense, a liberal construction’. It called
the 1961 Foreign Awards Act ‘a complete code by itself providing for all possible contingencies in relation to foreign awards made pursuant to
agreements to which Article II of the [New York] Convention applies’. (57)

In 1985, the Delhi High Court dismissed the distinction between domestic and international notions of public policy, noting that Section 7(1)
(b)(ii) of the 1961 Foreign Awards Act did not provide for such a distinction. (58)

In 1989, the Supreme Court in Koch Navigation Inc. while ordering enforcement of a foreign award under 1961 Act held that ‘[u]nder the Act, if
an application is filed for decree in terms of the award, the Court in upholding the award ought to grant a decree in terms of the award and
not subtract any portion thereof’. (59)

In 1992, the Supreme Court in NTPC v. Singer held that an interim award made in London by an ICC tribunal between an Indian company and
a foreign company and governed by the laws of India and providing jurisdiction for courts in Delhi be treated as an award governed under
domestic law, by the 1940 Arbitration Act, and not by the 1961 Foreign Awards Act. (60) Relying on Conflict of Laws by Dicey and Morris, the
Supreme Court held that ‘the proper law of the arbitration agreement is normally the same as the proper law of the contract’ and therefore
held that ‘the validity, effect and interpretation of the Arbitration Agreement are governed by its proper law’. The court rejected the argument
that the rules of procedure for the conduct of arbitration contractually chosen by the parties (the ICC Rules) or the mandatory requirements
of the procedure followed in the courts of the country in which the arbitration is held cannot supersede the overriding jurisdiction and
control of Indian law and the Indian courts. It concluded:

An award rendered in the territory of a foreign State may be regarded as a domestic award in India where it is sought to be
enforced by reason of Indian law being the proper law governing the arbitration agreement in terms of which the award was
made. The Foreign Awards Act, incorporating the New York Convention, leaves no room for doubt on the point. (61)

In 1994, Renusagar again surfaced before the Supreme Court in proceedings for enforcement of award in its favour filed under Section 5 of
the 1961 Foreign Awards Act. The Supreme Court judgment begins with these strong words, ‘The decision in these appeals would, we hope,
mark the culmination of the protracted litigation arising out of a contract entered into by the parties on August 24, 1964 for the supply and
erection of a thermal power plant at Renukoot in District Mirzapur, U.P.’ (62) It held emphatically:
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[I]n proceedings for enforcement of a foreign award under the Foreign Awards Act, 1961, the scope of enquiry before the court in
which award is sought to be enforced is limited to grounds mentioned in Section 7 of the Act and does not enable a party to the
said proceedings to impeach the award on merits.

On public policy it was held that Section 7(1)(b)(ii) of the 1961 Foreign Awards Act referred to public policy of India and not the public policy
of the State of New York in enforcement proceedings. The court rejected the argument that because the definition of ‘international public
policy’ was not defined, public policy in Article V(2)(b) of the New York Convention did not mean international public policy. The court held
that the doctrine of public policy must be construed to mean as applied by courts in which the foreign award is sought to be enforced. The
court expressly held, relying on observations in the first Renusagar case (extracted above):

This would imply that the defence of public policy which is permissible under Section 7(1)(b)(ii) should be construed narrowly […]
it must be held that the enforcement of a foreign award would be refused on the ground that it is contrary to public policy if such
enforcement would be contrary to (i) fundamental policy of Indian law; or (ii) the interests of India; or (iii) justice or morality. (63)

Mere contravention of law alone will not attract the bar of public policy but something more was required. The court accordingly directed
that the amount payable under the award be paid with interest at 18% per annum.

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In the same year, in RM Investment and Trading Company Pvt. Ltd. the Supreme Court while affirming the stay of the suit under Section 3 of
the Act granted in favour of Boeing construed the expression ‘commercial transaction’ broadly having regard to the manifold activities which
are an integral part of international trade. (64)

In 1995, the Supreme Court in Brace Transport Corporation of Monrovia defined the subtle distinction between recognition and enforcement
of an award, leaning on Law and Practice of International Commercial Arbitration by Redfern and Hunter (1986 ed.) and observed:

An award may be recognised, without being enforced; but if it is enforced, then it is necessarily recognised. Recognition alone may
be asked for as a shield against re-agitation of issues with which the award deals. Where a court is asked to enforce an award, it
must recognise not only the legal effect of the award but must use legal sanctions to ensure that it is carried out. (65)

11.3.4 1996 Arbitration Act

The 1996 Arbitration Act is an attempt to consolidate the law of arbitrations and repeal the Act of 1937, 1940 and 1961. Part I of this Act deals
with ‘arbitration’, while Part II
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deals with ‘Enforcement of Certain Foreign Awards’. Part II Chapter I is based on the New York Convention, while Chapter II thereof is based on
the Geneva Convention. The Act is founded on the Model Law. Among the objectives underlying the Act were to:

(i) comprehensively cover international and commercial arbitration and conciliation as also domestic arbitration and conciliation; and

(ii) make provision for an arbitral procedure which is fair, efficient and capable of meeting the needs of the specific arbitration;

The intention was to clearly keep Part I and Part II distinct, the former in respect of domestic arbitration and latter in respect of foreign
awards and related issues.

In 1999, the Supreme Court in Thyssen Stahlunion Gmbh held that the foreign award made on 25 February 1996 in London would be governed
by the new Act in so far as enforcement and recognition was concerned. (66) This was because though the 1996 Arbitration Act had come into
force on 22 August 1996, the ordinance issued prior thereto and replaced by the 1996 Arbitration Act was brought into force on 25 January
1995.

But two decisions rendered by the Supreme Court in 2002 and 2008 took the following approach. In Bhatia International the Supreme Court
held that Part I of the 1996 Arbitration Act would apply in respect of an arbitration held under the ICC Rules in Paris and accordingly justified
an order of interim protection under Section 9 of the Act. It was held that ‘in cases of international commercial arbitrations held outside
India, provisions of Part I would apply unless the parties by agreement, express or implied exclude all or any of its provision’ rejecting that
by selection of ICC Rules parties had agreed to exclude such application. (67) In a later decision in Venture Global Engineering the Supreme
Court went even further and held that Part I would apply even in respect of an award made outside India under LCIA Rules and justified
challenge to the award under Section 34 of the Act before a court in India although the successful party had filed a petition to recognise and
enforce the award in Michigan, USA. (68)

In 2010, in Sumitomo Heavy Industries Ltd. wherein the foreign award dated 27 June 1995 made in London was set aside by a single judge of
the Bombay High Court and affirmed by its Division Bench in appeal, the Supreme Court upturned the decisions and upheld the award
holding that ‘[h]owever, we are not required to go into that issue since we are otherwise holding that the award was not only a plausible one
but a well reasoned award’. The court held that the finding in an award by the umpire needed to be upheld because:
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The umpire is legitimately entitled to take the view which he holds to be the correct one after considering the material before him
and after interpreting the provisions of the agreement. If he does so, the decision of the umpire has to be accepted as final and
binding. (69)

Subsequently, the Constitution Bench of the Supreme Court in Bharat Aluminium Co. overruled the dictum in Bhatia International (70) and
Venture Global Engineering. (71) It held that neither Section 9 (interim measures) nor Section 34 (annulment) could be resorted to in respect
of international commercial arbitrations which are seated outside India. The court emphatically held that ‘[t]herefore such awards would
only be subject to the jurisdiction of Indian Courts when the same are sought to be enforced in India in accordance with the provisions
contained in Part II of the Arbitration Act, 1996’. (72)

The legislature has inserted a provision into Subsection (2) of Section 2:

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Provided that subject to an agreement to the contrary, the provisions of sections 9, 27 and clause (a) of sub-section (1) and sub-
section (3) of section 37 shall also apply to international commercial arbitration, even if the place of arbitration is outside India,
and an arbitral award made or to be made in such place is enforceable and recognised under the provisions of Part II of this Act.

This amendment virtually reflects the decision of the Supreme Court in Bharat Aluminium Co. (73)

This creates a piquant situation because the existing agreements if not containing such exclusion will attract the above provisions and in
new agreements express exclusion clauses will have to be entered into by the parties. This provision requires a careful examination by all
stakeholders.

Conflict in judicial approach continued, and in 2011 the Supreme Court in Phulchand Exports Ltd held that a foreign award could be set aside
under Section 48(2)(b) of Part II on a new ground, namely ‘if it is patently illegal’. (74) In 2014 the Supreme Court in Shri Lal Mahal Ltd expressly
overruled this decision, reaffirmed the law declared in the Renusagar case and held that the ‘public policy’ ground cannot include the newly
discovered ground of ‘patent illegality’. (75) The High Courts of Delhi and Madras have taken the view that violation of a provision of Indian
law does not fall under public policy for the purposes of the enforcement of a foreign award. (76) Recently, the Supreme Court revisited the
scope of the public policy of India in the context of Section 48 (2) of the Act. (77) It held that only in the very exceptional case of blatant
disregard of provisions of Section 48 of the Act, the court would interfere with a
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judgment of a High Court, which recognises and enforces a foreign award, however inelegantly drafted the judgment may be. The judgment
also classified the grounds for resisting enforcement of a foreign award into three categories: 1) grounds affecting the jurisdiction of
arbitration proceeding; 2) grounds affecting parties interest alone; and 3) ground touching upon the public policy of India.

However, later on, the Supreme Court refused to enforce a foreign award on the ground of it being opposed to public policy under Section
7(1)(b)(ii) of the Foreign Awards Act. (78) While doing so, the Supreme Court while reviewing a foreign award on the grounds of merit, at the
stage of enforcement, has sought to considerably expand the scope of public policy to include in it contravention of export policy of a
government. However, in this judgment, the Supreme Court failed to take note of its earlier judgment in Vijay Karia & Ors. v. Prysmian Cavi E
Sistemi, (79) wherein it had held that a violation of provisions of FEMA does not amount to a violation of the public policy of India. The court
further observed that the Supreme Court would interfere with a judgment which recognises a foreign award only in ‘exceptional case of
blatant disregard’ in the following words:

… it is important to emphasise that, unlike Section 37 of the Arbitration Act, which is contained in Part I of the said Act, and which
provides an appeal against either setting aside or refusing to set aside a ‘domestic’ arbitration award, the legislative policy so far
as recognition and enforcement of foreign awards is that an appeal is provided against a judgment refusing to recognise and
enforce a foreign award but not the other way around (i.e. an order recognising and enforcing an award). This is because the
policy of the legislature is that there ought to be only one bite at the cherry in a case where objections are made to the foreign
award on the extremely narrow grounds contained in Section 48 of the Act and which have been rejected. This is in consonance
with the fact that India is a signatory to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958
(hereinafter referred to as “New York Convention”)….. Also, it would only be in a very exceptional case of a blatant disregard of
Section 48 of the Arbitration Act that the Supreme Court would interfere with a judgment which recognises and enforces a foreign
award however inelegantly drafted the judgment may be. (80)

The 2015 Amendment has further defined public policy of India in so far as the New York Convention and the Geneva Convention are
concerned by inserting the following in Sections 48 and 57:

Explanation 1. – For the avoidance of any doubt, it is clarified that an award is in conflict with the public policy of India, only if, –

(i) the making of the award was induced or affected by fraud or corruption or was in violation of section 75 or section 81; or

(ii) it is in contravention with the fundamental policy of Indian law; or

(iii) it is in conflict with the most basic notions of morality or justice.

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Explanation 2. – For the avoidance of doubt, the test as to whether there is a contravention with the fundamental policy of Indian
law shall not entail a review on the merits of the dispute.

Like the annulment provision (Section 34), almost identical amendments were made in Section 48 vide the 2015 Amendment Act. The
amendment, in fact, narrowed down the scope of public policy of India in Section 48 as the species, namely ‘interests of India’, has been

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completely done away with and the species ‘morality or justice’ has also been curtailed by addition of a prefix, namely ‘basic notions of’.

Interestingly, even though the 246th Law Commission Report has discussed the reason for adding the prefix ‘most basic notions’ before the
term ‘morality or justice’, (81) no reason whatsoever has been given for removing the term ‘interests of India’ from the ambit of ‘public policy
of India’, (82) which otherwise very much fell within the scope of public policy of India as interpreted by the Supreme Court in Renusagar. (83)

As discussed earlier, in the context of the amendment of the annulment provision, the amendment of Section 48 would also have to be
accorded a prospective operation.

Recent trends in judicial decisions by High Courts and the Supreme Court reflect leaning in support of arbitration and enforcement of
awards. The Supreme Court in Eitzen Bulk took the view that a challenge under Section 34 of the 1996 Arbitration Act was not possible in
respect of an international commercial arbitration award since the contract provided that the dispute is to be ‘settled and referred to
arbitration in London’ and thereby making English law applicable to the contract. (84) In BGS SGS Soma v. NHPC the Supreme Court held that
the seat is akin to an exclusive jurisdiction clause, ‘which would then vest the Courts at the ‘seat’ with exclusive jurisdiction for purposes of
regulating arbitral proceedings arising out of the agreement between the parties’. (85) This view has been taken by the Supreme Court even in
its earlier judgments. (86)

In Shakti Bhog Foods Ltd., the Supreme Court interpreted the definition of ‘arbitration agreement’ to include not only a written agreement
but also an agreement inferred from the conduct of the parties and the correspondence exchanged between them. (87)

Similarly, the Supreme Court has held that Section 45 in Part II of the 1996 Arbitration Act is mandatory and parties must be referred to
arbitration, by decisions
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in Worlds Sports Group (Mauritius Ltd) (88) and Sasan Power Ltd. (89) A series of decisions of the Bombay, Calcutta, Madras and Delhi High
Courts also reflect this approach. (90)

The Supreme Court, (91) while dealing with the instance where the seat of arbitration was outside India with the governing law of the
underlying contract being Indian law, observed that the validity of such an award could only be tested in the annulment proceedings in the
court of the seat and that even then Part I of the Act cannot be applicable to such foreign-seated arbitration. The Supreme Court (92)
subsequently held that in such a situation, if a challenge to the award is made in foreign jurisdiction, the said challenge has to be decided by
applying Indian public policy. In a further decision, the Supreme Court while examining the scope of public policy upheld the enforcement of
a foreign award, while observing that the courts uphold the foreign awards exercising minimal interference. (93)

The 2015 Amendment has made one major change and that is to provide jurisdiction to the High Courts in respect of enforcement of foreign
awards by providing as under:

Explanation – In this section and in the sections following in this Chapter, ‘Court’ means the High Court having original jurisdiction
to decide the questions forming the subject-matter of the arbitral award if the same had been the subject matter of a suit on its
original civil jurisdiction and in other cases, in the High Court having jurisdiction to hear appeals from decrees of courts
subordinate to such High Court. (94)
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11.4 CONCLUSION

11.4.1 Guidelines for Practitioners

(i) Courts with jurisdiction: For domestic awards, the court for the purpose of enforcement, before and after the 2015 Amendment, would be
the court as defined in Section 38 of the Code of Civil Procedure 1908. Consequently, the natural corollary would be that the court, which
passed a decree or the court to which it is sent for execution where assets and properties of the debtor under the award are situated, is
competent. But, as per the latest view, (95) an execution petition for the enforcement of an award can be filed directly anywhere in the
country, where such decree can be executed. There is no requirement of obtaining a transfer of the decree from the court which had
jurisdiction over the arbitration proceedings or from the court of the annulment proceeding. For foreign awards, the High Court having
original or appellate jurisdiction will be the competent court.

(ii) Stamping of award: The 1996 Arbitration Act does not make it obligatory to register an award for the purpose of stamping. However, the
Supreme Court raised the issue of validity of an arbitration agreement due to being invalidly or insufficiently stamped. Before the 2015
Amendment, this issue was raised in SMS Tea Estate v. Chandmari Tea Company in which the court held the arbitration agreement
integral to the entire underlying contract, and thus, while being separable, the arbitration agreement must also be validly or adequately

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stamped for a Section 11 application to be valid. Post-2015 Amendment, the Bombay High Court took an approach more in line with the
legislative intent of the 2015 Amendment in Gautam Landscapes v. Shailesh Shah (96) to speed up initiation of arbitral proceedings by
declaring any enquiry into insufficient stamping as being beyond the purview of applications under Section 11, due to the newly
inserted Section 11(6A)’s call for reduction in judicial interference. However, the Supreme Court reverted to the position of the whole
underlying agreement, including the arbitration agreement, to be impounded as per the Stamp Act in Garware Wall Ropes v. Coastal
Marine Constructions. (97) This is because the Indian Stamp Act, 1899 necessitates such stamping by virtue of Section 35 read with Item
12 of Schedule I thereof. Documents inadequately stamped (or not stamped) are inadmissible in evidence for any purpose and are liable
to be impounded and are subject to penal duties up to ten times of the proper stamp duty or that of the deficient portion, under
Section 35’s first proviso. (98) Any award has to be stamped, but the rates of stamp duty vary from State to State in India, found in the
provisions, addenda or schedules of the respective Stamp Act of the relevant
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State. (99) Moreover though non-stamping/deficient stamping of an award may not be a relevant ground in an annulment proceeding,
the same can make a domestic award unenforceable. (100) Insofar as a foreign award is concerned, there is no requirement for the same
to be stamped under the Indian Stamp Act, 1899, for the purpose of the same being enforced within the territory of India. (101)

(iii) Registration of award: Awards, however, need not be registered under the Registration Act 1908 unless it deals with immovable property
in which case it is compulsorily registrable. (102) Again the registration fee varies from State to State. (103)

(iv) Interim awards: Enforcement of interim awards is a slightly complex evaluation. The date of the arbitration agreement and the date on
which the arbitration was commenced provide for additional yardsticks.

(v) Reservations to the New York Convention: Of relevance to the enforcement of foreign awards, India has opted to both the commercial
and reciprocity reservations to the New York Convention. Additionally, Section 44(b) of the 1996 Act provides that only awards made in a
reciprocating convention country as notified in the official gazette are enforceable. A similar caveat is provided in Section 53(c) of the
1996 Act for awards under the Geneva Convention.

11.4.2 Guidelines for Judges and the Way Forward

Industries and particularly industry’s chambers together with the Indian arbitration community on the one hand and the foreign arbitral
institutions, the international arbitration community and respective governments of concerned jurisdictions on the other hand must work
together to bring about the synergy required. The judiciary needs to ensure consistency in judgments by ensuring that across the courts in
the country including the Supreme Court, only those judges must preside and that too for long periods who have exposure to commercial
laws and litigations. The Government of India must also play a proactive role. The following recommendations could be helpful to judges:
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(i) the grounds for challenge to the award as exhaustive; (104)

(ii) refrain from reviewing the award on its merits; (105)

(iii) burden of proving the existence of a refusal ground rests on respondent; (106)

(iv) construe the grounds of refusal narrowly; (107)

(v) refuse enforcement only in serious cases; (108) and

(vi) pro-enforcement attitude and contribution to the effectiveness of arbitration. (109)

It must be mentioned that the journey in the development of jurisprudence on recognition and enforcement of both domestic and foreign
awards is a continuing one
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in Indian courts. It is not a journey which is always on a straight road, and many a times it has veered into different directions and there is no
guarantee that it will not do so in future despite the existing law which is fairly well supportive of recognition and enforcement.
260

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References
*) The author is thankful to Unnayan Mishra for his able and efficient assistance.
1) General Manager of the Raj Durbhunga v. Maharajah Coomar Ramaput Sing, 1872 SCC OnLine PC 16: (1871-72) 14 Moo IA 605.
2) The World Bank, Doing Business Measuring Business Regulation, available at [Link]
3) The World Bank, Doing Business Measuring Business Regulations, India, Enforcing Contracts, available at
[Link] See also, The World Bank, Doing Business Measuring Business
Regulation, Enforcing Contracts methodology, available at [Link]
4) Ramshai v. Joylall, AIR 1928 Calcutta 840.
5) Order 21, CPC provides the framework for the execution of decrees.
6) Section 85(2)(a), 1940 Arbitration Act: ‘Notwithstanding such repeal, the provisions of the said enactments shall apply in relation to
arbitral proceedings which commenced before this Act came into force unless otherwise agreed by the parties but this Act shall apply in
relation to arbitral proceedings which commenced on or after this Act comes into force […].’
7) Thyssen Stahlunion Gmbh v. Steel Authority of India Ltd (1999) 9 SCC 334, para. 22.
8) Section 36(1) read with Section 34(3) of the 1996 Arbitration Act.
9) State of H.P. v. Himachal Techno Engineers (2010) 12 SCC 210.
10) Rajnish Gupta & Anr. v. Brij Mohan Aggarwal, 2019 SCC OnLine Del 11635.
11) Benarsi Krishna Committee v. Karmyogi Shelters (P) Ltd. (2012) 9 SCC 496.
12) Food Corporation of India v. M/S Shiva Rice Mills & Ors (2014) 210 DLT 321 (DB) Jolly Brothers Pvt. Ltd v. Surendra Nath Jolly, 2016 SCC
OnLine Bom 3973.
13) Section 34(3), 1996 Arbitration Act. Section 34 deals with setting aside of the arbitral awards. For a review of the evolution of Section 34,
the jurisprudence related thereto, and the corresponding practice tips, see Chapter 10 of the Handbook.
14) Kanpur Jal Sansthan v. Bapu Constructions (2015) 5 SCC 267.
15) Union of India v. Popular Construction Co. (2001) 8 SCC 470.
16) International commercial arbitration is defined in terms of involvement of a party whose nationality, residence, incorporation or central
management belongs to another country. See Section 2(f), 1996 Arbitration Act.
17) Bharat Aluminium Company v. Kaiser Aluminium Technical Services (2012) 9 SCC 552.
18) White Industries Australia Limited v. The Republic of India, UNCITRAL, Final Award, 30 November 2011. See also, Report of the High Level
Committee to Review the Institutionalization of Arbitration Mechanism in India, 30 July 2017, available at
[Link] p. 43 (recognising that ‘endemic delayed and ambiguities in judicial
precedent […] have prevented the Indian courts from being viewed as supportive of arbitration [and] has had an impact on the choice of
India as an arbitral seat’). For further discussion of White Industries, see Chapter 13 of the Handbook.
19) ONGC Ltd. v. Saw Pipes Ltd (2003) 5 SCC 705. For a review of the case and the concept of patent illegality, see Chapter 10 of the Handbook.
20) ONGC Ltd. v. Western Geco International Ltd. (2014) 9 SCC 263. For a review of the case and impact of the adoption of Wednesbury
principle to reviewing arbitration awards, see Chapter 10 of the Handbook.
21) See White Industries Australia Limited v. The Republic of India, UNCITRAL, Final Award, 30 November 2011. Here, the investor had spent
almost nine years trying to enforce a commercial award before the Indian courts. The investor subsequently took recourse under the
India-Australia BIT, pursuant to which the tribunal found India had breached its obligations under the BIT as it had failed to provide the
investor with effective means of asserting claims and enforcing rights. For a review of the White Industries case, see Chapter 13 of the
Handbook.
22) Section 34(2) of the 1996 Arbitration Act, fashioned to some extent on Article V of the New York Convention, lists various grounds on
which an award may be set aside. The grounds under Section 34(2) have been expanded upon in other Chapters of the Handbook (see,
e.g., Chapter 2 which discusses arbitrability as a ground for challenge and Chapter 10 which discusses the ground of public policy).
23) Khaleel Ahmed Dakhani v. Hatti Gold Mines (2000) 3 SCC 755 (the court stayed enforcement of an arbitral award due to an issue of lis
pendes, captured as an issue in an appeal before the High Court. Thus, orders allowing for enforcement of arbitral award under Section
36 were set aside by the High Court on the premise of lis pendes and not due to an objection to the award filed under Section 34).
24) NHAI v. B. Seenaiah (2012) 4 Cal LT 40 (HC) at para. 22 and Aditya Fuels Ltd. v. Bilt Chemicals Ltd. 2007 (4) ArbLR 110 (Gujarat) at para. 27.
25) In Kanpur Jal Sansthan & Anr. v. Bapu Constructions (2015) 5 SCC 267, it was held that in such proceedings, the principle of Code of Civil
Procedure would be applicable; thus, the provisions of Order 41 Rule 5 CPC, which provides for stay by the appellate court, in principle
became applicable. The said judgment further held that under the said provision of CPC, ordinarily execution of money decree is not
stayed; a deposit of security is a condition precedent by appeal court staying the execution of the decree. In other words, discretion has
been conferred on the appellate court either to direct deposit of the amount disputed in the appeal or to permit such security in
respect thereof being furnished as the appellate court may think fit.
26) National Aluminium Co. Ltd. v. Pressteel & Fabrications (P) Ltd. (2004) 1 SCC 540. This judgment was followed in National Buildings
Construction v. Lloyds Insulation India Ltd (2005) 2 SCC 367. A similar view was taken in Fiza Developers & Inter-Trade (P) Ltd. v. Amci (I)
(P) Ltd,(2009) 17 SCC 796.
27) Ibid.

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28) In Paramjeet Singh Patheja v. ICDS Ltd. (2006) 13 SCC 322 and Maharashtra State Financial Corpn v. Ashok K. Aggarwal & Ors (2006) 9 SCC
617, the Supreme Court held that the use of the term ‘decree’ in Section 36 was for a very limited purpose, namely, that the procedure
available and/or the steps which could be taken for execution of a decree under CPC were available for enforcing of such an arbitral
award.
29) Associate Builders v. Delhi Development Authority (2015) 3 SCC 49.
30) Recall: Saw Pipes expanded public policy to include patent illegality and Western Geco imported administrative law principles into the
court’s review. Both cases have been discussed in Chapter 10 of the Handbook.
31) (2019) 17 SCC 796.
32) Recall the decision in National Aluminium Co. Ltd. v. Pressteel & Fabrications (P) Ltd. (2004) 1 SCC 540, discussed above, where the
Supreme Court expressed its hope that necessary steps would be taken by the authorities at the earliest to bring about the ‘required’
change in law – i.e., doing away with the automatic stay of enforcement following institution of a challenge.
33) Statement of Objects and Reasons, Arbitration and Conciliation (Amendment) Act 2015.
34) See note to para. 18 (ii) (dealing with amendment to Section 34) under Chapter 3 of 246th Report of Law Commission dated August 2014.
35) HRD Corporation v. GAIL (2018) 12 SCC 471, at para. 18, while examining similar explanations introduced in Section 48(2)(b) of the Act
through the 2015 Amendment, the Supreme Court has observed that the same has narrowed down the ground of challenge.
36) Sedco Forex International Drill Inc. & Ors. v. CIT, Dehradurn & Ors. (2005) 12 SCC 717, para. 17; Bank of Baroda v. Anita Nandrajog (2009) 9
SCC 462, at para. 12.
37) Order XLI, Rule 5 CPC.
38) BCCI v. RSW, Kochi Cricket Private Ltd, 2016 SCC OnLine Bom 6064.
39) New Tirupur Area Development Corporation Ltd. v. M/s Hindustan Construction Co. Ltd., Application No. 7674 of 2015 in O.P. No. 931 of
2015.
40) Ardee Infrastructure Pvt. Ltd. v. Anuradha Bhatia, 2017 SCC OnLine Del 6402 (DB).
41) The Supreme Court has held that amended provision will apply to those arbitration proceedings which commenced post 2015
Amendment and will also apply to court proceedings which commenced post 2015 Amendment.
42) (2006) 11 SCC 181.
43) (2010) 11 SCC 296.
44) (2009) 10 SCC 63.
45) Order of Delhi High Court dated 7.1.2020 in NTPC v. Italian Development Public Company, OMP(COMM) 4/2020.
46) Order dated 16.10.2019 of the Delhi High Court in BSNL v. Teracom Ltd., OMP (COMM) 431/2019.
47) Pam Developments Pvt Ltd. v. State of WB (2019) 8 SCC 112; Ecopack India Paper Cup Pvt. Ltd. v. Sphere International, 2018 SCC OnLine
Bom 540; UoI v. Palm Developments (Cal HC) – G.A. No. 1903 of 2018 and A.P. No. 1121 of 2016 decided on: 05.09.2018.
48) Topic E of Chapter 6 of Part 1 of Report of Justice BN Srikrishna High Level Committee dated 30 July 2017.
49) Paragraph 5 of Topic E of Chapter 6 of Part 1 of BN Srikrishna High Level Committee Report dated 30 July 2017.
50) Paragraph 9 of Topic E of Part 1 of BN Srikrishna High Level Committee Report dared 30 July 2017.
51) Antrix Corporation Ltd. v. Devas Multimedia pvt. Ltd, 2018 4 ArLR 66 (Delhi).
52) In Hindustan Construction Company v. Union of India, 2019 SCC OnLine SC 1520, it has been held by the Supreme Court that the BCCI
judgment will continue to apply so as to make applicable the amendments made by 2015 Amendment Act to all court proceedings
initiated after the date of such amendment act coming into force, i.e. 23 October 2015.
53) Francesco Corsi v. Gorakhram Gokalchand, AIR 1960 Bom 91.
54) Shiva Jute Baling Ltd. v. Hindley and Co. Ltd. (1960) 1 SCR 569: AIR 1959 SC 1357.
55) V.O. Tractoroexport v. Tarapore & Co. (1969) 3 SCC 562.
56) Renusagar Power Company Ltd. v. General Electric Company (1994) Supp 1 SCC 644.
57) Ibid.
58) COSID Inc. Steel Authority of India Ltd. (High Court 1985), in Yearbook Commercial Arbitration XI (1986) (India no. 11), pp. 502-507. See
also, Marike Paulsson, The 1958 New York Convention in Action (2016), pp. 228-230.
59) Koch Navigation Inc. v. Hindustan Petroleum Corpn. Ltd. (1989) 4 SCC 259.
60) NTPC v. Singer Co. (1992), 3 SCC 551.
61) Ibid.
62) Renusagar Power Co. Ltd. v. General Electric Co., 1994 Supp (1) SCC 644.
63) See India No. 22, Renusagar Power Co. Ltd. v. General Electric Co., Supreme Court, 7 October 1993, in Yearbook Commercial Arbitration,
Vol. XX (Albert Jan Van den Berg ed., ICCA & Kluwer Law International 1995), pp. 681-738, at paras 38-39.
64) RM Investment and Trading Company Pvt. Ltd. v. Boeing Company (1994) 4 SCC 541.
65) Brace Transport Corpn. of Monrovia v. Orient Middle East Lines Ltd., 1995 Supp (2) SCC 280.

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66) Thyssen Stahlunion Gmbh v. Steel Authority of India Ltd (1999) 9 SCC 334 (see the case of Western Shipbreaking Corpn. v. Clareheaven
Ltd. dealt therein).
67) Bhatia International v. Bulk Trading, 2002 (4) SCC 105. For a review of the case, see Chapter 8 of the Handbook.
68) Venture Global Engineering v. Satyam Computer Services Ltd. (2008) 4 SCC 190. For the impact of this decision, and a review of the
related jurisprudence, see also Chapter 10 of the Handbook.
69) Sumitomo Heavy Industries Ltd. v. ONGC Ltd. (2010) 11 SCC 296.
70) Bhatia International v. Bulk Trading SA, 2002 (4) SCC 105.
71) Venture Global Engineering v. Satyam Computer Services Ltd. (2008) 4 SCC 190.
72) Bharat Aluminium Co. v. Kaiser Aluminium Technical Services Inc. (2012) 9 SCC 552.
73) Ibid.
74) Phulchand Exports Limited v. O.O.O. Patriot (2011) 10 SCC 300.
75) Shri Lal Mahal v. ProgettoGrano Spa (2014) 2 SCC 433.
76) Cruz City 1 Mauritius Holdings v. Unitech Limited, 2017 (3) ARBLR 20 (Delhi); Thaicom Public Company Limited v. Raj Television Network
Ltd., 2017 (2) ARBLR 321 (Madras).
77) Vijay Karia & Ors. v. Prysmian Cavi E Sistemi – 2020 SCC OnLine SC 177.
78) National Agricultural Co-operative Marketing Federation of India (NAFED) v. Alimenta S.A., 2020 SCC OnLine SC 381.
79) Supra n. 76.
80) National Agricultural Co-operative Marketing Federation of India (NAFED) v. Alimenta S.A., 2020 SCC OnLine SC 381.
81) The reason for this amendment was to further tighten the Renusagar test by limiting the scope of the term ‘morality or justice’.
82) See note to para. 18 (ii) (dealing with amendment to Section 34) under Chapter 3 of Law Commission Report No. 246.
83) Renusagar Power Co. Ltd. v. General Electric Co., 1994 Supp (1) SCC 644.
84) Eitzen Bulk A/S v. Ashapura Minechem Ltd. (2016) 11 SCC 508.
85) BGS SGS Soma JV v. NHPC Ltd., 2019 SCC OnLine SC 1585.
86) Indus Mobile Distribution v. Datawind Innovations (2017) 7 SCC 678; Emkay Global v. Girdhar Sondhi (2018) 9 SCC 49.
87) Shakti Bhog Foods Ltd. v. Kola Shipping Ltd., AIR 2009 SC 12.
88) World Sport Group (Mauritius) Ltd. v. MSM Satellite (Singapore) Pte. Ltd. (2014) 11 SCC 639.
89) Sasan Power Ltd. v. North American Coal Corp. (2016) 10 SCC 813.
90) SIMS Metal Management Limited v. Sabari Exim Pvt. Ltd. (2015) 1 Arb LR 225 (Mad); E-City Entertainment (I) Pvt. Ltd. v. Imax Corporation,
2015 (2) Arb LR 107 (Bom); Bunge London Ltd. v. R. Piyarelall Import and Export Ltd. (2015) 5 ArbLR 370 (Cal); Eitzen Bulk A/s v. Ashapura
Minechem Ltd. (2016) 1 Bom CR 466; Integrated Sales Services Limited v. Arun Dev and Ors, 2017 (2) ArbLR 290 (Bom).
91) BALCO v. Kaiser Aluminium,(2012) 9 SCC 552, paras 160-163.
92) Reliance Industries v. Union of India (2014) 7 SCC 603, para. 76.4.
93) Government of India v. Vedanta Ltd., Civil Appeal No. 3185 of 2020, judgment dated 16 September 2020.
94) Section 47, 1996 Arbitration Act:

47 (1) The party applying for the enforcement of a foreign award shall, at the time of the application, produce before the
court –
(a) the original award or a copy thereof, duly authenticated in the manner required by the law of the country in
which it was made;

(b) the original agreement for arbitration or a duly certified copy thereof; and

(c) such evidence as may be necessary to prove that the award is a foreign award.

(2) If the award or agreement to be produced under sub-section (1) is in a foreign language, the party seeking to
enforce the award shall produce a translation into English certified as correct by a diplomatic or consular agent of
the country to which that party belongs or certified as correct in such other manner as may be sufficient according
to the law in force in India.

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95) Sundaram Finance Ltd. v. Abdul Samad & Anr. (2018) 3 SCC 622.
96) Gautam Landscapes v. Shailesh Shah, AIR 2019 Bom 49.
97) Garware Wall Ropes v. Coastal Marine Constructions and Engineering Ltd. (2019) 9 SCC 209.
98) First proviso to Section 35 of the Indian Stamp Act, 1999.
99) State Wise Stamp Duty Schedule & Concerned Act, Institute of Company Secretaries in India available at
[Link] and [Link] (State-
wise stamp duty rules for various eForms, MoA, AoA).
100) M. Anusuya Devi & Anr. v. M. Manik Reddy & Ors (2003) 8 SCC 565.
101) Shriram EPC Ltd. v. Rioglass Solar SA (2018) 5 ArbLR 161 (SC).
102) Ramesh Kumar v. Furu Ram (2011) 8 SCC 613.
103) To be obtained from the respective government websites of the relevant States. For example, the stamp duty and registration fee
applicable in the NCT of Delhi is available at [Link]
sub+registrar/important+information+regarding+registration+of+property.
104) Marike Paulsson, The 1958 New York Convention in Action (Kluwer Law International, 2016) pp. 166-167; ICCA’s Guide to the
Interpretations of the 1958 New York Convention – A Handbook for Judges, available at [Link]
[Link]/publications/NYC_Guide/NYC_Guide_English.html, p. 79.
105) Marike Paulsson, The 1958 New York Convention in Action (Kluwer Law International, 2016) pp. 168-171; ICCA’s Guide to the
Interpretations of the 1958 New York Convention – A Handbook for Judges, available at [Link]
[Link]/publications/NYC_Guide/NYC_Guide_English.html, p. [Link]://[Link]-
[Link]/publications/NYC_Guide/NYC_Guide_English.html. See also, NHAI v. Intercontinental, 251 (2018) DLT 732 (any error made by an
arbitrator in the construction or interpretation of terms ought not to be corrected or interfered with by the court; merely because
alternate view is possible but not taken is not ground for court’s interference or ground to set aside the award); Dyna Technologies v.
Crompton Greaves (2019) SCC OnLine SC 1656 (arbitral awards should not be interfered with in a ‘casual and cavalier manner’ and the
court cannot interfere unless it finds that the perversity of the award goes till the root of the matter and no alternative interpretation,
even implied, salvages the arbitral award); South East Asia Marine Engineering and Constructions Ltd. (Seamec Ltd.) v. Oil India Limited,
AIR 2020 SC 2323 (where two views are possible, court cannot interfere in the plausible view taken by the arbitrator supported by
reasoning); Government of India v. Vedanta Limited, Civil Appeal No. 3185 of 2020 (arising out of SLP (Civil) No. 7172 of 2020), Supreme
Court, decided on 16 September 2020 (courts do not sit in appeal over award when undertaking the Section 48 examination); Venture
Global Engineering. v. Satyam Computer Services Ltd (2008) 4 SCC 190 (the court cannot act as an appellate court to examine the legality
of an award while examining the award under Section 34 of the 1996 Arbitration Act).
106) Marike Paulsson, The 1958 New York Convention in Action (Kluwer Law International, 2016) pp. 171-173; ICCA’s Guide to the
Interpretations of the 1958 New York Convention – A Handbook for Judges, available at [Link]
[Link]/publications/NYC_Guide/NYC_Guide_English.html, pp. 79-80.
107) Marike Paulsson, The 1958 New York Convention in Action (Kluwer Law International, 2016) pp. 173-174; ICCA’s Guide to the
Interpretations of the 1958 New York Convention – A Handbook for Judges, available at [Link]
[Link]/publications/NYC_Guide/NYC_Guide_English.html, pp. 80-82. See also, Lion Engg. Consultants v. State of M.P. (2018) 16 SCC 758
(plea of jurisdiction under Section 34 can be raised before the court even if it was not raised before the tribunal); Ssangyong
Engineering v. National Highway Authority (2019) 15 SCC 131 (narrow interpretation and construction of public policy).
108) Marike Paulsson, The 1958 New York Convention in Action (Kluwer Law International, 2016) pp. 174-175; ICCA’s Guide to the
Interpretations of the 1958 New York Convention – A Handbook for Judges, available at [Link]
[Link]/publications/NYC_Guide/NYC_Guide_English.html, p. 83.
109) Marike Paulsson, The 1958 New York Convention in Action (Kluwer Law International, 2016) pp. 13-16, p. 165.

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