ARB.&CONCL.

ACT, 1996: ENFORCEMENT OF CERTAIN FOREIGN AWARDS 293

PART II Canclliation Act, 1996, the term 'Commercial' has not been defined in the
Act.
However, the Model Law guidelines provide that the term 'Commercial
ENFORCEMENT OF CERTAIN FOREICN ahould be given a wider interpretation so as to cover matters arising from
AWARDS
transactions which are commercial in nature whether contractual or not.
The 'commercial' as explained in UNCITRAL Model Law on
term
Mternational Commercial Arbitration, 1985 includes matters and relationships
INTRODUCTION Vof a commercial nature, but are not limited to, the following transactions
) any trade transaction for the supply or exchange of goods
or services,
Prior to the enactment of the present Arbitration and Conciliation ct, ii) distributica agreements;
were regulated by
1996, the foreign arbitration agreements and awards two (iii) commercial agencies;
separate Acts, namely, the Foreign Awards (Recognition and Enforcement) Act,
1961 and the Arbitration (Protocol and Convention) Act, 1937 both of which (iv) factoring, leasing, licensing, consulting,etc
now stand repealed consequent to passing ot the present Arbitration and (v)construction and engineering works;
Conciliation Act of 1996. The provisions of these wo earlier enactments are (vi) investment, financing, banking, insurance, exploitation agreement or
incorporated in Chapter I and Chapter respectively of Part iW of the preseat concession;
Act of 1996. This Part i. e., Part II consists of only two chapters, the first
(vii) joint ventures and other forms of industrial or business co-operation,
chapter containing the provisions of the earlier Foreign Awards (Recognition (vii) carriage of goods or passengers by air, sea, rail or road
and Enforcement) Act, 1961, which relateto the awards under the New York (or
United Nations) Convention, 1958, and the second chapter is devoted to Choice of place of Arbitration & Law applicable thereto
provisions of the earlier Arbitration (Protocol and Convention) Act,
1937 which
As to the choice of place of arbitration, Section 28 of the Arbitration and
relate to the awards under the Geneva (or League of Nations) Convention, 1927.
Conciliation Act, 1996 provides that in an international commercial
Section 52 of the Arbitration and Conciliation Act, 1996 provides that arbitration:
Chapter I of Part II excludes theapplication of Chapter II but Chapter II does
(i) the dispute shall to be decided in accordance with the rules of law
not exclude the application of Chapter I. designated by the parties as applicable to the substance of the dispute,
Excepting Section 52 in Chapter I, both the Chapters consist of eight (ii) if the designation is of the law or legal system of a country. it shall
Sections each dealing with same subject matter and the phraseology of the mean the substantive law of that country and not its conflict of law;
sections is also almost the same barring Section 47 of Chapter I and Section 57 of (iii) where the parties have not so designated the rules of law, then
the

Chapter II which deal with the enforcement of foreign awards. Arbitral Tribunal has to apply any rules of law, which it considers
relate to appropriate.
Thus it may be stated that Chapters I and II of Part II of the Act
Convention The Supreme Court in TDM Infra-structure (P) Ltd. v. UE Dervelopment
awards made under the New York Convention and the Geneva
India (P) Ltd.,2 held that Indian nationals should not be permitted
to derogate
be refused if the
respectively. The enforcement of a foreign award may which was from Indian law as a matter of public policy.
applicant furnishes evidence before the Court that the agreement suffering As regards the choice of law, the Supreme Court
in Shin-Etsu Chemicals
entered into between the parties was invalid or that the party was
of arbitral agreement
receive notice of the Co. Ltd. v. Akash Optifibre Ltd.,3 held that the proper
from some incapacity or that the party did not proper itself because it has the closest
otherwise unable is the substantive law goverming the contract
appointment of the arbitrator or arbitral proceedings
or was
and most real connection with the transaction.
enforcement of foreign
to present his case. The other provisions relating to is the law which the parties
have
award are similar to that of the domestic award and there is
no difference so In short, proper law to be applied reason of its
impliedly chosen
or which is them
imputed to by
far as enforcement of award is concerned. expressly or
the contract.
closed and most intimate connection with
The awards contemplated under this Part i.e. Part II relate to International Arbitrahon, 1985.
Arbitration. Though the term 'International Commercial Model Law on International Commercial
Commercial 1. See Footnote of UNCITRAL
and

Arbitration has been defined in Section 2 (1) f) of the Arbitration 2. (2008) 14 SCC 271.
(2005) 7 SCC 234
4. NTPC v. Singer Co. (192) 3SCC
551 (563)

292)
ARBITRATION AND ALTERNATIVE DISPUTE RESOLUITIO
1ON
294
Foreign Award
defined in Section 44 of the Act. CHAPTERI
A foreign award' has been
award made on or after October, 11, 1960 on differences arising bet Cans an

out of legal relationships, whether contractual or not, which are conPersons

red NEW YORK CONVENTION AWARDs
to
force in India.
be commercial' under the law in
does not become a foreign Section 44. Definition.-In this Chapter, unless the context otherwise
It must be stated that an award award

because it was made in the territory

outside India, but it becomes so beca. se it
requires, foreign award means an arbitral award on differences between
persons arising out of legal relationships, whether contractual or not,
made in the territory of a foreign state where arbitration agreement is not
governed by the law of India. In other words, if an award is made on Considered as commercial under the law in force in India, made on or
an after the 11th day of October, 1960:
arbitration agreement governed by the Indian Law, though rendered outside
India, will not be treated as 'foreign award' by the Indian Courts. This may be (a) in pursuance of an agreement in writing for arbitration to
illustrated by the leading case of Harendra H. Mehta v. Mukesh H. Mehta2 which the Convention set forth in the First Schedule applies, and
decided by the Supreme Court. In this case, parties were two brothers havine
their joint business in India as well as USA. They also had properties in both
(b) in one of such territories as the Central Government, being
satisfied that reciprocal provisions have been made may,
the countries. When differences arose between them, they appointed an by
notification in the Official Gazette, declare to be territories to which
arbitrator for distribution of their business and property between them. The
the said Convention applies.
arbitration agreement was made in USA and the proceedings were held and
award was made in USA. The Court held that this was a foreign award. The COMMENTS
differences between parties pertained to their legal relationship which was of This section defines thee expression "foreign award" as also the meaning of
a commercial nature under the Indian Law. The fact that they were brothers
the term "commercial" in context of foreign awards. The award must have been
did not take the out of
award purview of
the the
Act. Though the parties made on or after the 11th day of October, 1960 when the foreign awards were
entered into a settlement during the pendency of arbitral proceedings and the governed by the Foreign Awards (Recognition and Enforcement) Act, 1961
award was made in terms of the said settlement, it was still a 'award' under
the Act of 1996 and its enforcement in India could not be refused on the ground which was repealed
consequent to the coming into force of the Arbitration &
Conciliation Act, 1996 (Section 44 of the Act).
that it was not made a decree by Court in USA where it was passed. The Court
also held that registration of award was not necessary under the Act3 Explaining the phrase "unless the contert otherwise requires, the Supreme
Court in Centrotrade Minerals & Metals Inc v. Hindustan Copper Ltd.,
held
A foreign award is recognised and enforceable in India as if it were an
award made on a matter referred to arbitration in India. Such an award will be that where the arbitration agreement comprised two phases, the first to be
held in India under Part I of the Act while the second i.e., the appellate
ordered to be filed by a competent Court in India which will pronounce judgment proceeding was to be held in a New York Convention Country under Part II of
according to the award.
the Act, the appellate award fell within the meaning of foreign award under
Section 44 of the Act.
A foreign award will not be enforced by Court
that the subject-matter of the award is not
in India if it is satisfied
a

under Indian
capable
of settlement by arbitration Foreign awards are essentially an outcome of foreign arbitration.
Law or the enforcement of the award is contrary to public policy. Pherefore, it is also necessary to consider the connotation of the term "foreign
arbitration" to know exactly what is meant by a foreign award:
As early as 1960, the High Court of Calcutta explained the term 'foreign
Arbitration' in Serajuddin v. Michael Golodetz2 and observed that an
arbitration (i) held in foreign lands, (ii) by foreign arbitrators, (iii) to which a
foreign aw is applicable, and (iv) in which a foreign national is involved as a
party, may be termedas 'foreign arbitration'. In the instant case all these
characteristics were present and the case was decided under the American
Arbitration law and, therefore, it was held to be a 'foreign arbitration. The
1. Infra.
2. AIR 1999 SC 2054.
3. Ibid. 1. (2006) 11 SCC 245.
2. AlR 1960 Cal. 49 (para 42).
4. Sections 46 and 47 of Arbitration and
Conciliation Act, 1996.
(295)
296
ARBITRATION ARB. & CONCL ACT. 196 NEW YORK
AND ALTERNATTVE DISPUTE RESOLUTION
IS. 44
s 451 CONVENTION AWARDS 297
case later on
by the Delhi
difterent 8rounds.
came up betore the
supreme Court of India,' in w r e d for
gnout.
a1bitration to
The disputesofbetween
inao-uerman Chamber Cor the part
arnes v ere
appeal but on
ce arbitral ne
he Supreme Court renal consisted oaorors, one each appointed by the parties
o

called upon to interpret the term

was
Itt
N.T.PC V. Singer m 'foreign
foreign award ilowed the claim o a n a l a s t India and rejected he
London y Company. n sthis case an nte
interim an
s

porstener. Onereceiving the copy of the award, and p

e c l a i m of
out of an
OSe
awara
gTeement g o v e rWas d s made
made in
ndiait The SSupreme
ndia The
do
to
Court declined hold it
ourt declined to proceedings in ny entorcement of the award
tor

because Do ated
that
tnat it was
was a
a domestic award toreign the
award
as a
and deded assets in Inaa
in
respect of the contract because it was governed
and the arbitratic by indian laws both The respondent 1e. Dorstener opposea the
entorcement ot the award and
The High Court of Delhi Gas in toOr an ue
inunction.
crint

S.A. tollowed the Authority of India Ltd. v. Spie Capag

1e
prayed
depth the historical Case" and examined waargued on behait ot Sana
Fiast india that the case being a toreign
Opments which led
conventions and th developments which led to the Ne
In

York and Geneva award in the

ig Oe k LOnventon, the respondents were not
under the two entitled for nten u
he Foreign AWards (Recognition and enactments
Enforcem enforcemen od
a ved in
indan Lompany seeking
p a n y in uermany because the
ArOration (P'rotocol
and
Convention) Act,196.1937 which are
1961 and the
Arbitration and Conciliation Act otACt, are
In this case, t wae b y the latter
GAL o n and
constituted m tor liquidated. Company should not e h e s e circumstances,
the German
Pemittea to restrain the Indian Company from
liquidated can damages tribnal
nternational Chamber of procecd betore the arbitral ing the award in Germany by eeking an nterm unietion
additional ciaim
is not capable
ot Lommerce and >pe capag extra The Court accepted
Sand Flast s Fiea
not
given notice of the claim being reterred to arbitration because it hadd
behalt or Dorstener.
and
the tejected arguments advanced
as
required in
the aprtration agreement. on t
was held that since the
agreement had a
toreign
The New York element involving international trade and commerce, the New York Convention
shall Convention apply
awards made the
to the arbitral was applicable to the case.
State other than
a state where their recognition and eercementis
in

nat is, oniy to the awards made in Sougnt,

foreign countries. It "shall also apply lt may be pointed out that New York Convention deals with both, the
àrbitral aWards not considered as domestic awards the State in
arbitration awards and arbitration agreements
ecognition and entorcement
is sought." where their
Section 45. Power of judicial authority to refer parties to
'Foreignaward' distinguished from a "domestic award' arbitration.-Notwithstanding anything contained in Part I or in the
y1opegn award as
distinguished from domestic award' is
Code of Civil Procedure, 1908 (5 of 1905), a judicial authority, when
one which has seized of an action in a matter in respect of which the parties have made
anyotthe tolowing elements: an agreement referred to in shall, request
(1) One of the parties national of
Section 44, at the ot one ot the
is a a
foreign country: or parties or any person claiming through or under him, reter tne parties
(2) the that is null and vo1d,
subject
matter of
arbitration agreement
is aroitration unless it tinds the said agreement
character. That is, it deals with international commerce,
trade
international in

or
inoperative or incapable of being pertormed.
investment etc:
COMMENTS
(3) the award is made in ot Part I
a foreign country ne provISions of this section are analogous to those ot Sechon
Aroitrdnon h
ot
On the other hand, a domestic award is one which does not have are applicable in tor reterring parties to
cak o
any of the ACtwhich
atoresaid toreign elements or characteristics. domestic arbitration
. tn

singuishing Section 45 from Section

8 ot the
Act, Noharwal
he case ot Dorsteer Maschine(Germany) v.
Sand Plast India may be B it
mandatory 0
observed that Section 8 makes
Case,
eSOugnt a8ainst
ustrarethethe oint rurther. Thus was a case wherein an injunction was
entorcement of the loregn award in Germany but the same y reter the parties
to arbitration existe C
to refuse
on the

uated in the section. But this section does not ent which the
on the ground
of invalidisy o ee
A IR 1963 c e to arbitration exticn
n
is conferred to exercise under sethion nus appiues
authority arbitrations
New York
to which
Convention

3. AIR 1994 Del. 75 with

1993 SC 9
n deals
AR
5 (195) 1 Arb LR 282 (Del) 1. (2005) 7 SCC 2A
ARB. &CONCL. ACT, 1996: NEW YORK
298 ARBITRATION AND ALTERNATIVE DISPUTE S. 451 CONVENTION AWARDS 299
RESOLUTION S. 45
specific provision has been made to examine the
dispute between the endorsee of bills of lading and owners and charterers of
validity of the arbitration Ahe ship concerned. t was immaterial that the expression "charterparty" in
agreement. Further, Section 45 does not provide the limitation that the arbitration clause in the charterparty agreement was not changed to bill of
application should be moved not later than submitting the first statement on 1ading. The High Court erred in not allowing application of the owners of the
the substance of the dispute as
provided under-Section 8 of the Act.
The chip under Section 45 seeking stay of a suit filed by the endorsee of the bills of
reason for this difference is
that insotar as domestic arbitration is obvious lading and for reference to arbitration."
the legislature intended to achieve
speedy reference of concerned,
Tribunal and left most of the matters to be raised beforedisputes to the Arbitral
the arbitrators. But
The Supreme Court, therefore directed that the suit be stayed and reference
case of foreign arbitration under
Section 45, the legislature, in its wisdom, left
in
toarbítration be ordered by the High Court.
the question relating to the validity of the Where one of the parties to an arbitration agreement institutes a suit in a
examined and decided by the Court.
arbitration agreement to be
Court of law of the contracting State despite the fact that there was an
Thus it would be seen that arbitration agreement Section 45 of the Act empowers the judicial authoríty
matter of
Section 8 leaves discretion in the Court in the
no
referring
parties to arbitration i.e,the Court to refer the parties back to arbitration if the following conditions
Court to refuse a reference to arbitration it it finds thatwhereas Section 45 empowers the are satisfied-
is 'null and void', or
arbitration agreement
of
incapable being performed. 1. There is anagreement between the parties to which the New York
This section opens with or Geneva Convention
applies;
nom obstanate clause giving over-riding effect to
a

the provision contained therein and making it mandatory to 2. The action relates to a matter agreed to be referred to arbitration
anything to be contained in the Arbitration Act the Code of Civilprevail over
or
The use of the word
'shall makes it obl+gatory upon the Court to passProcedure.
the order
3. The Court is satisfied that the arbitration agreement is not void or
inoperative or incapable of being performed;
staying the legal proceedings commenced by a party to the agreement if the
condition specified therein are fulfilled. However, before 4. The dispute arose out of the legal relationship, whether
proceeding the Court should be satisfied that the arbitration staying the contractual or not; and
valid, operative and capable of being performed and there is agreement is
existence of 5. Such differences are considered as 'commercial' under the law
disputes between the parties with regard to the matters agreed to be referred to enforce in Indía.
arbitration. This in other words means that it is
the circumstances
obligatory for the Court under The provision contained in Section 45 relating to New York Convention is
envisaged in Section 45 to refer the parties to arbitration,
which in result would necessitate stay of the suit other analogous to that contained in Section 54 of the Act which relates to Geneva
legal proceedings.
or
Convention.
Both New York Convention (Para 3 of Article II) and Geneva
Convention In Shin-Etsu Chemical Co. Ltd. v. Aksh Optifibre Ltd. & Another the
(Para 4) enjoin a duty upon the Courts to refer the
parties to arbitration and reference of dispute for arbitration arising out international agreement
obtain arbitrator's decision instead of Court unless it (court) finds that the said
agreement is null and void or incapable of being performed. The provision of involving foreign law came for the consideration before the Court. The
the New York Convention thus reference was rejected on the ground of invalidity of agreement under Section 45
imposes a responsibility on the Court to stay the of the Act. The judicial authority is required to pass reasoned order after
action or legal proceedings and refer the to arbitration.parties hearing the parties. The impugned order is liable to appeal under Section 50 (1)
Explaining the scope of Section 45, the Apex Court Owners and Parties (a) of the Act. However, where the finding of the Court is in favour of validity
Interested in Vessel Mv "Baltic Confidence v. STC2 inter alia, observed: of arbitration agreement, it is not appealable under Section 50 of the Act. It,

"Attempt should be made to give meaning and effect to the incorporation therefore, follows that only order declaring arbitral agreement as invalid is
clause, if the intention of the parties to refer disputes to arbitration apppdable.
is
clear..The
use of
incorporation clause ought not to be invalidated or frustrated by These sections ie, Section 45 and Section 54 of the Indian Arbitration and
Conciliation Act, 1996, made under New York and Geneva Conventions,
literal, pedanntic and technical interpretation. Where incorporation
clause in conditions of
carriage of bills of lading clearly set out that all terms respectively, provide that an application or request for staying the action
referring parties to arbitration may be made by "either of the parties or any
for
and conditions of the
charterparty including the law and arbitration clause are
herewith incorporated, the arbitration clause in
charterparty was applicable person claiming through or under him." Such reference to arbitration shall not
prejudice the competence of the Courts in case the agreement or the arbitration
1 Remu Sagar Power Co. Ltd v. General Electric Company, AIR 1985 SC 1156.
2 AIR 2001 SC II 2381 .(2005) 7 SCC 234.
ARB. 2 the
s.,47 to requirement of
award having regzrd
b o u t t h e
bility of the
e n f o r c e a b i l

award is enforceable,
the Court can take
ecided that the
dec and
300 ARBITRATION AND ALTERNATIVE DISPUTE RESOLUTION
S 46 O n c e it is
of the same.
The staternent cf Objects
orovisions.
execution enforced if it
cther effective steps
for
that every final
award is to be as

becomes inoperative or cannot be proceeded lurther for one reason make it clear award there
or the other. 4) enforcerment of a foreign
ons (Para Therefore, for
The Supreme Court has, however, expressed a view that where of the Court. enforceability of
a dispute is
re a decree for deciding the
amenable to international arbitration, interim injunctions against separate proceedings,
one
ofher to take up
reference should not be allowed to continue for a
such
i ao need to take of the Court or
decree, arnd the
long time and the domestic to make
it a rule
Courts should restrict such grant of interim injections. e aWard
execution thereafter. decision in Fargo Freight
refer to the Supreme Court
Section 46. When foreign award binding.-Any foreign award be pertinent to wherein a petition for
which would be enforceable under this Chapter shall be treated as It would Corporation&others'
who were the
LId.v. Commodities Exchange the appellants
filed by
binding for all purposes on the persons as between whom it was made, of the English
award was
out the said
vessei to the
and may accordingly be relied on by any of those persons by way of enforcement DEKHODA . They
had chartered and
of vessel regarding payment of freight
defence, set off or otherwise in any legal proceedings in India and owners a dispute of thee
any
references in this Chapter to entorcing a foreign award shall be construed respondent
and there arose
Court in this case held that
under Section 46
etc.. The e n f o r c e m e n t of award
has
as including references to relying on an award. demurrage chargesConciliation Act, 1996, the
and third persons
Arbitration and liabity of
to the award
COMMENTS to be between parties Part I of the Act does not
necessarily not be decided
because
this case) could proceedings
Article V Para 1 (e) of the New York Convention provides that an award (Le. Bank in such disputes with
third parties in such
would be binding on parties when (1) it has been made by a regular Courts to decide be challenged on
proceeding, permit that a foreign award
cannot

and (ii) it complies with the formalities required 46 of the Act provides except the
for an arbitral award. It Section
conclusive and binding for all purposes,
be refused.
becomes final when application for setting aside is refused. A 'binding' award final,
mefits, being out in Section 45 in which enforoement thereof wil
is enforceable, but it is not 'final' as long as it is 'open to means of circumstances set The Court has oniy
for this reason that the New York Convention has avoided to use the term
recourse. It is cannot set aside or
annula foreign award.
Domestic Courts enforceable or not
final' in place of "binding' as is found in Article 1 (2) (d) of the Geneva whether the award is
jurisdiction to decide Corporatiom (P)
v
Ld
Convention. In other words, Geneva Convention makes award to be final in the in Euro-Asia Chartering
The Bombay High Court which is certifed and
country in which it is made, therefore, any proof of means of recourse is no held that a foreign award
Fortune International Ltd3 proceedings for
longeravailable against the
award. This is not so under the New York final can be enforced without taking out any
Convention and the enforcement of award can be sought in another country attested as In this case the contract
for supply of goods
determination of its enforceability. and E n a i s e d n
w a s negotiated
without seeking leave for enforcement exequatur' from the country where the between an lndian and a foreign company
contract docunent in
Purjab and sent it
award was made. The Indian Company signed the it in
Bombay. of the foreign company also sined
Where an award has not yet become binding nor has it been set aside or to Bombay and the representatives
entered into a t Bombay the
that since the contract was
suspended, the enforcement of the award may be refused by the country in Bombay. The Court held entertain the petition
nder Section 4
Court in had the jurisdiction to
Bombay
yhich it is made. An award becomes binding once the ordinary means of to enforce the award
recoursesuch as an appealis no longeravailable.
Section 47. Evidence.-{1) The parry applyving for the enforcement of
Under the Indian law, an arbitral award is recognised as binding and final
after the expiry of the period for making application for setting aside of the a foreign award shall, at
the time of the application, produce before the

award or where such an application was made, but rejected. Court

authenticated in i
The Supreme Court explained the scope of the provisions contained in (a) the original award or copy thereot, duly
a

manner required by the law of the country in which it was

Sections 46 to 49 of the Act in its decision in Fuerst Day Lowson Ltd. v. Jindal
made:
Exports Ltd. and observed "Looking to the provisions contained in Sections 46
to 49 (b) the original agreement for arbitration or a duly certified copy
in relation to enforcement of a foreign award, a party holding a foreign
award can apply for enforcement of it but the Court before taking further thereof; and
effective steps for the execution of the award has to proceed in accordance with
Sections 47 to 49 of the Act. In the first stage, the Court may have to decide AIR 204 SC 4109

L W h e S ov
g Ran lnteratu AIR 183 Dei 247
1 R .Dressor Rand S.A. v. RG Khosla Compressors Ld. 1995 Supp. 3) SCC 181 AIR 0C Bm 4

2AlIR 2001
Gmbhe c 2293
v SAIL. The9 SCC
(199) in this case relied on its earlier decision in Thyseen Stah!lunam
Court334
ARB. & CONCL. ACT, I996: NEW YORK CONVENTION AWARDS 303
302 ARBITRATION AND ALTERNATIVE DISPUTE 481
RESOLUTION IS. 47
Section 48.
Conditions for enforcement of foreign awards.-(1)
(c) such evidence as may be necessary to Euforcement of a foreign award may be refused, at the request of the
a foreign award. prove that the award is
against whom it is invoked, only if that party furnishes to the court
(2) If the award or agreement to be
in a produced
foreign language, the party seeking under sub-section
to entorce the (1) is proofthat
produce translation into English
a shall award (a) the parties to the agreement referred to in Section 44 were, under
consular agent of the country to certified correct by a diplomatic or
as
the law applicable to them, under some incapacity, or the said
correct in such other manner as which that party belong or certified
agreementitis not valid under the law to which the parties have
may be sufficient according to the law as
force in India. in subjected or, failing any indication thereon, under the law of
the country where the award was made; or
Explanation.-In this section
and all the following sections of this
Chapter "Court" mea the principal Civil Court of (b) the party against whom the award is invoked was not given
a district, and inicludes the
High Court in
original jurisdiction in proper notice of the appointment of the arbitrator or of the
civil jurisdiction,
having
exercise of its
ordinary original
if the same had been the
over jurisdiction
the subject-matter of the award arbitral proceedings or was otherwise unable to present his case;
subject-matter of a suit, but does not include
any Civil Court of a grade inferior to such
or

Court of Small Causes. principal Civil Court, or any (c)the award deals with a difference not contemplated by or not
falling within the terms of the submission to arbitration, or it
COMMENTS contains decisions on matters beyond the scope of the
This section lays down the method of submission to arbitration:
proof for the enforcement of the
foreign award. Article V Para 1 (c) of the New York Convention Provided that, if the decisions on the matters submitted to
"recognition and enforcement of the award may be refused at the providesof that arbitration can be separated from those not so submitted, that
party against whom it is invoked, only request the
if that
award deals with a dispute or difference not party furnishes proof that the part of the award which contains decisions on matters
submitted to arbitration may be enforced; or
within the terms of reference of arbitration or contemplated by, or not
it contains decisions on falling
matters (d) the composition of the arbitral authority or the arbitral
beyond the scope of submission to arbitration.
Article 2 (c) of the Geneva Convention. This has Similar provision exists in procedure was not in accordance with the agreement of the
been further elaborated with
succeeding Section (i.e., Section 48 of the Arbitration and Conciliationin the or, failing such agreement, was not in
parties, accordance
1996). Act, the law of the country where the arbitration took place; or
The High Court
of Madras in Compania Naviera (e)the award has not yet become binding on the parties, or has
'SODNOC' v.
Refineries Ltd., held that a party having foreign award in its favour Bharat could
been set aside or suspended by a competent authority of the
straightaway apply for its enforcement since foreign award is already country in which, or under the law of which, that award was
as a decree. Such an award stamped
may be enforced within a period of 12 years time as
made.
in case of a decree-holder of a court. if the Court
(2) Enforcement of an arbitral award may also be refused
The Court in this case
of foreign award was
pointed out the leave of English court for enforcement finds that:
necessary only when the award was sought to be enforced (a) the subject-matter of the difference is not capable of settlement
in courts of
England,
in Indian courts.
but no such leave is
necessary for enforcement of such award by arbitration under the law of India; or
(b) the enforcement of the award would be contrary to the public
In
Toepfer International Asia (P) Ltd. Thapar Ispat (P) policy of India.
was
passed by the Grain & Seeds Trade Association
v.
Ltd., an award
under the Arbitration Explanation-Without prejudice to the generality of clause (b) of this
Rules, which prohibited raising the
before the Arbitral Tribunal. The plea
of limitation where it was not section, it is hereby declared, for the avoidance of any doubt, that an
raised
proceedings resulted in an ex the public policy of India if the making of the
in conflict with
award is induced or affected
The objecting party had not raised the plea of limitation before parte award.
they were, therefore, not
the Tribunal,
allowed to oppose the enforcement of the award
award was by fraud or corruption.
on
the ground that it was barred by limitation. (3) If an application
for the setting aside or suspension of the award
has been made to a competent authority referred to in clause (e) of sub-
1. AIR 2007 Mad. 251. section (1) the Court may, if it considers it proper, adjourn the decision
2. AIR 1999 Bom. 417.
NANDALTERNATIV DISPU
the RESOLUTION
on
enforcement of the S. 4W ARB.& CONCL. ACT. 1996: NEW YORK CONVENTION AWARDSs 305
party claiming enforcenmentaward and
may also, on the
, 48)

suitable security. of the award, applicationon of the

order the other ot fn Sia Bioenergie (decree-holder) v. SHEC Systems (Judgment-debtors)! a
party to give hmission was made on behalf of the Judgment debtor for permission to lead

The New York Convention would COMMENTS oral evidence in support of the objections tothe enforcement of the award dated
only one party belongs to the recognise and enforce the award 19th May, 2003 under Sections 48 and 34 of the Arbitration and Conciliation

Convention requires that the signatory State. But as evan

Act, 1996. The Delhi High Court explained at length the true meaning and
import of the phrase "furnish proof to the Court" used in Section 48 (1) and held
against
signatoryStates, then only the award beaward must belong this,
parties to the the Cen
to two
that the whole purpose of the Act would be completely defeated if permission
words, if the award has been made inmay recognised and enforced. diferent In other
is granted to the applicant (Judgment debtor) to lead oral evidence at the stage
Geneva Convention or if it is country which is
a of objections raised against an arbitral award. The process of oral evidence
of between persons who are not not signatory to t e would prolong the process of hearing objections which would be contrary to the
signatory State, it may not be
It may be noted recognised and enforced. subject of jurisdictionon main objective of the Arbitration and Conciliation Act. The provisions of the
with the legal statusthat the triology of Sections 46, 47 and 48 Act are meant to ensure fair, efficient and expeditious disposal of disputes

binding. While Section 46 envisages its proof for beingcollectively

of foreign award and
deals through arbitration with minimal interference by the Court.
purposes, Section 47
recognised and
binding nature of the award for Section 42 (2) (b) of the Act empowers the Court to set aside the arbitral
Section 48) deals with
provides
the method of
proof. The present section all award made outside India if it violates Public Policy. Similar provision is
the conditions for
enumerates the circumstances wnich enforcement of foreign awards (i.e., contained in Section 34 (2) (b) where the arbitral award is made in India. The
use of the words "if the Court finds that in the section makes it clear that it is
award. The listed circumstances justify Court's refusal to enforce and
have to be
enforcement of the award. rigidly proved in order to refuse the not necessary for the party to plead that the award violates Public Policy but
Briefly
enforcement of the award may be stated, these circumstances
under which
the the duty is cast on thé Court itself to see that the award is not in violationn of
refused by Court are as follows
the Public Policy. In Renusagar Power Co. Ltd v. General Electric Co. Ltd.2 which
(1) If the arbitral arose under the Foreign Awards (Recognition & Enforcement) Act, 1961 which
agreement is invalid;
(2) Due process of law has been implemented the New York Convention of i1958 relating to recognition and
violated; enforcement of foreign awards, the Supreme Court inter-alia observed: "In order
) Arbitrator has exceeded his to attract the bar of Public Policy, the enforcement of the award must involve
authority; something more than mere violation ofthe law of India. The enforcement of a
(4) Irregularity in the
composition of Arbitral Tribunal foreign award would be contrary to public policy if it is contrary to fa)
proceedings; or arbitral
Law; (b)
fundamental policy of Indian the interests of India;
and (c) justice and
(5) Award being set aside or morality.
law which, that award was suspended in the
country in which, or under the The
made; Supreme Court in Transoccan Shipping Agency v. Black Sea Shipping3

(6) Non-arbitrability of the dispute; and rejectedin the contention that enforcement of
international foreign award
an

(7) Award being contrary

made Ukraine would be
against public
policy as the arbitrator was an
employee of one of the parties and, therefore, would not be independent.
to public policy
It, therefore, follows that for the enforcement of It may, however, be stated that the phrase 'public policy has been
limited scope of enquiry as foreign award there is interpreted differently by Courts depending on whether "the award is made by
envisaged
under Section 48 of the Act. international or domestic Arbitration Tri unal. This is why the noted
Belgium
Explanation'
to Section 48 further makes it clear that if the
making of the arbitration expert Bernard Hanotian has described it as the most
confusing
award induced or affected by fraud or corruption, it would be deemed to be
was notion which has ever been invented." It is
opposed to the public policy in India and, therefore, it would not be
heartening to note that the
Arbitration (Amendment) Bill, 2003 seeks to define the term
public policy'
so
enforceable. as to give it an exact meaning.
Sub-section (3) of Section 48 provides that where a party has made an The Supreme Court in Venue Global
Engineering v. Satyam Computer
Services Ltd. & Another,i held that foreign award which was
application for setting aside or suspension of the foreign award, the Court, on passed outside
the application of the party claiming enforcement of the award, may require
AIR 2005 Del. 95.
the other party to give suitable security, if it considers it proper and AIR 1994 SC S60.
reasonable. (1998) 2 SCC 281.
AlR 2008 SC 1061.
DISPUTE RESOLUTION
ARBITRATiON
AND
ALTERNATIVE

IS 49 ARB. & CONCL. ACT, 1996: NEW YORK CONVENTION AWARDs 307
306 S. 50)
not enforceable in India by
invoking provisiane
cannot be said to be the Code of Civil Procedu the Similarly, the party who applies for the enforcement of the foreign award
India
and Conciliation Act,
1996
or the application'08. to for
Arbitration
will be open to the parties to exclude may also append
an application for execution the application
However, it and Conciliation Act h enforcement so that the Court declaring the award be an enforceable decree can
Part I of the Arbitration expres or
provisions of Part I would be applicabla
implied agreement,
otherwise, the whole
Section 34 to foreign international -
any proceed to execute it without any further procedural requirement, otherwise a
separate application would have to be moved for execution.
applying the provisions of
event,
would not be
inconsistent with Section
48
ot the Act, o r any other provisio It may be reiterated that even in case of domestic award, the new
awards nvolving
of foreign properties situate in India h Arbitration Law of 1996 equates it to a decree of the Court enforceable by its
Part I1. Even in
case

the judgment-debtor residing abroad,

the
award can be enforced against such own force without the necessity of award being filed in the Court for execution
of the judgment-debtoOr as a decree. There is no right of appeal against the recording of satisfaction by
properties in India either through personalIncomplance the judgment-debtor the Court, under Section 49 of the Act.
or holding out a threat
by contempt.of a case, such
cannot be deprived of theright
to file a n application for setting aside
his the It must be stated that the procedure for enforcement of awards under the
34 of Act.
award under Section
Geneva Convention of 1937, the New York Convention of 1958, and Section 49 of
In the instant case, the entorcement of a foreign award directing the the Arbitration and Conciliation 1996
Act, is much the same. Any person who is
appellant foreign company
to
transter shares in lndian company (respondent)
interested in enforcing foreign
a award may apply in writing to any Court
was sought by the respondent in foreign Court (US District Court) was held to having jurisdiction over the subject matter of the award. The Court for this
and therefore, the appellant can
be violative of share-holders agreement purpose would be Principal Civil Court of Original Jurisdiction in a District and
challenge the award under Section 34 of the Arbitration and Conciliation Act
in Indian Cóurt. That apart, in view of the injunction restraining the respondent High Court
and
in
exercising original jurisdiction civil suits. Alongwith the award
transfer of shares being the respondent ought noi to have
theagreement on which it is based, sufficient evidence
award is a 'foreigrm award' should also be filed
showing
that the
from effecting by the party applying for the
proceeded with the in a
matter foreign Court without getting the earlier enforcement of the award. The award becomes a decree of the Court on Court
injunction order vacated. being satisfied that it is a foreign award enforceable under the law. There is no
The Supreme Court in Controtrade Minerals & Metals Inc. v. Hindustan provision in the Act for issue of notice to the affected party before Court makes
it a decree.
Copper Ltd.2 interpreted the "country phrase under
the law of which, that
award was made" used in Section 48 (1) (e) to mean law of the country in which The Apex Court in M/s Kochi Navigation Co. v. M/s
the arbitration has its seat rather than the country whose law governs the Hindustan Petroleum
Corporation Ltd. observed that the meaning of the 'foreign award' should be
substantive contract. interpreted in the light of the New York Convention and its implementing
Section 49. Enforcement of foreign awards.-Where the Court is legislation in India. The award must be executed as it is. The only ground on
which it may be modified is its
satisfied that the foreign award is enforceable under this Chapter, the ambiguity.
award shall be deemed to be a decree of that Court. Section 50. Appealable orders.-(1) An appeal shall lie from the
COMMENTS order refusing to :
The section confers the status of decree on foreign award as a result of (a) refer the to parties arbitration under Section 45;
which it becomes executable by its own force. This deeming provision has been
(b) enforce a
foreign award under Section 48,
incorporated in this section with a view to ensuring smooth and speedy
to the Court authorised by law to hear
execution of recognised and unobjectionable foreign awards. appeals from such order.
The Supreme Court in Fuerst Day Lauson v. Jindal Exports Ltd.3 held that (2) No second appeal shall lie from an order passed in appeal under
thissection, but nothing in this section shall affect take away any
the provisions of Sections 46 to 49 read together make it clear that noseparate
to appeal to the Supreme Court.
or
right
proceedings are necessary for the enforcement of foreign award. The Court can
decide
also
the enforceability of the award to make it a decree or rule of Court and COMMENTS
take up its enforcement in tie same proceedings instead of two separate
proceedings. The section enumerates two cirCumstances referred
and 48 when an appeal shall lie against those orders. There is no provision
to under Sections 45

Global Enginering for a second appeal but the section does not preclude the right of the parties
ene
22, 25.
v. Satyam Computer Services Lid. & Another. AIR 2008 SC 1061, Paras
2. (2003) 3 Bom. LR 948.
1. Force Shipping Lid. v. Ashapura Mine Chem. Ltd. (2003) 3 Bom LR 948.
3. AIR 2001 SC 2293.
2. AIR 1989 SC 2198
ALTERNATIVE DISPUTE RESOLUTIOON
ARBITRATION AND
308 S. 50
Coart against
the order passed bv
by the appella
to the Supreme ARB. &CONCL. ACT. I996: NEW
to appeal S. SI|
YORK CONVENTION AWARDS 309
Court.
Nissai Asb Pot. Ltd.,1 the
Put. Ltd. v. M/s.
In Orma Imper
the Supreme
Court was whether uestion for which hears appeals from the
ordering of the CLB, within the jurisliction of
which the Registered Office of the
consideration before
of Court 45 refusing to
under Section refer company is situated. The High Court of
order of Single Judge High
Delhi dismissed the
Bench of that High Court? Due
s o
appeal filed by the appellant for lack of territorial
would lie to Division confli
cting jurisdiction holding that Section 10 (1) (a) of the Companies Acl, 1956 will take
Court and High Court of Bombav. th
arbitration
decisions of the Calcutta High precedence over Section 50 of the Arbitration & Conciliation Act, 1996. Thi»
to direct this special leave petition to hoeme
Court thought it appropriate Placed order of the High Court was maintained by the
Supreme Court being in
Bench. In Stale of West Bengal v. M/s
before its three Judge took the view that no furthew a accordance with the law in India.
Chatterjee,2 the High Court of Calcutta
would lie against the order passed by the Single Judge of a Higlh to its Under Section 50 (1) of the Act, an appeal would lie
against the order
Court of Bombay had taken a contrarv refusing to reler tlhe parties to arbitration under Section 45 of the Act. Sub-
Division Bench. But the High section (2) of Section 50
Vanita Khanolkar v. Pragna M. Pai,3 and ohso prolibits any second appeal against the order
appeal under that section, but that would not affect or take away anypassed
in
this regard in its decision in
that such an appeal is permissible relying upon Clause 15 ot the Letters tent
appeal to the Supreme Court. The scope of the said prohibition came in for right to

applicable to High Court of Bombay. consideration before the Supreme Court in Shin-Elsu Chemical Co. Ltd. v.
The instant appeal before the Supreme Court was against the orderof Vindhya Telelinks Ltd. In this case, the respondents filed a sult ignoring the
wherein the High Court had taken arbitration clause and the appellants filed an
Single Judge of the Delhi High Court
referring the same for arbitration. The Apex Courlapplication
a the Court for
view that no further appeal would lie under Section 50 of the Arbitration and
remitted the matter back to
Conciliation Act, 1996 against an order made under Section 45 of the Act the Civil Judge for
deciding afresh after treating the applieation as one under
refusing to refer parties to arbitration. The Apex Court regretted that in this Section 45 of the Act.
under Section 45 and
Thereupon, the Civil Judge considered the application
case, the learned Single Judge had not taken notice of Section 10 of the Delhi passed a common order, holding tlhat the arbitration
High Court Act and Clause 10 of the Letters Patent which apply to High Court clause on the basis of which the
Section 45 was prinma facie,
appellant had filed the application under
of Delhi.
be referred to arbitration.
inoperative and, therefore, the parties could not
The Supreme Court, in ITI LId. v. Siemers Public Communications Network
Ltd. held that even though no second appeal shall lie from the order of the The order of the Trial Court was
district Court, which allowed the
challenged by the appellant before
appellate Court passed under Section 37 of the Act, but a revision petition under appeal, and set aside thhe order of the trial
Court and directed it to consider the matter afresh under
Section 115 of the Civil Procedure Code can be filed against such orders. Section 45. This order
of the district court was
The Supreme Court in Sumitomo Corporation v. CDC Financial Services
challenged before the Supreme Court on the
that neither the trial Court nor the distriet Court ground
recorded a finding that
(Mauritius) Ltd. & others,3 held that Section 50 of Arbitration and arbitration agreement was null and void and
incapable of being
Supreme Court agreed with the contention of the appellant thatperformed.
The
Conciliation Act, 1996 provides for appeal against appealable order and the
even though
forum to which such appeal would lie will be the 'Court authorised by law to un appeal
may not lie from the order in the appeal, the right of
Supreme Court having been specifically saved under Section 50, such appeal
to
hear appeal from such order'. It is clear from the provision contained in Section appeal to
37 of the Act which provides that appeal would lie to the Court which hears Supreme Court was maintainable. The Court pointed out that while sub-section
the
appeal and not the Court which exercises original jurisdiction if the subject (2) of Section 50 barred second appeal nothing in Section 50 would affect or take
matter had been a suit as
provided in the to Section 47 or Section
explanation away any right to appeal by special leave to Supreme Court. The reason being
2(c) of the Arbitration and Conciliation Act. that an appeal by special leave to
Supreme Court cannot be considered as an
appeal as of right or an appeal in pursuance of right to appeal. The Court,
As per thecase,
the instant
provision
the
of Section 50 of the Arbitration and Conciliation Act in
therefore, dismissed the appeals without going into the merits reserving
appeal against the order of the Company Law Board liberty to the appellants to pursuce their remedy in accordance with law before
(CLE) refusing to refer parties to arbitration, would lie to the High Court
the High Court.
1 AIR 1999 SC 2871. Section 51. Saving-Nothing in this Chapter shal prejudice any
2 (1993) 3 SCC 1. rights which any person would have had of enforcing in India or any
AIR 1998 SC 424
4 AIR 2002 SC 2308. award or of availing himself in India of any award if this Chapter had
not been enacted.
5. AIR 2008 SC 1594

1. (2009) 14 SCC 16.

DISPUTE RESOLUTION
ARBITRATION AND ALTERNATTVE
310 [S. 52
COMMENTS

provision contained in this

The section is a saving clause which i CHAPTERII
further comment.
explanatory and hardly need any
GENEVA CONVENTION AWARDS
Section 52. Chapter II not to apply-Chapter II
of this par+
not apply in relation to foreign awards to which this Chapter lies.
Section 53. Interpretation.-In this Chapter "foreign award" means
COMMENTS an arbitral award on differences relating to matters considered as
It has already been stated in the Introduction' to Part I dealing with s commercial under the law in force in India made after the 28th day of
enforcement of certain foreign awards that Section 52 of the Act stat July, 1924
excludes the application of the succeeding Chapter
II relating to ly
awards to which the New York
va (a) in pursuance of an agreement for arbitration to which the
Convention Awards to foreign Convention ie., Protocol set forth in the Second Schedule applies, and
Chapter I applies. In other words, this section contemplates that Chapter 1t
shall not be applicable to foreign awards to which the provisions New York (b) between persons of whom one is subject to the jurisdiction of
some one of such Powers as the Central
Convention as contained in Chapter I apply. Government, being
satisfied that reciprocal provisions have been made,
may, by
notification in the Official Gazette, deciare to be parties to the
Convention set forth in the Third Schedule, and of whom the
other is subject to the jurisdiction of some other of the Powers
aforesaid, and
(c) in one of such territories as the Central Government,
being
satisfied that reciprocal provisions has been made,
may, by like
notification, declare to be territories to which the said
Convention applies,
and for the purposes of this
Chapter an award shall not be deemed to be
final if any proceedings for the
purpose of contesting the validity of the
award are pending in the
country in which it was made.!
COMMENTS
The definition of 'foreign award' for the
purposes of Geneva Convention as
contained in this section differs from the
foreign
under the New York Convention. The differences
award as defined in Section 44
may be stated as follows:
(1) The definition of 'foreign award as given in Section 44 under the
New York Convention begins withthe non-obstante clause ie,'unless
the context otherwise requires, but it is not so in case of Section 53.
(2) The words 'arising out of legal relationships, whether contraetual or
not as used in Section 44 are conspicuously missing from the definition
of 'foreign award' under the Geneva Convention in Section 53.
(3) While Section 44 insists that the agreement must be in writing,
Section 53 simply talks of agreement simpliciter, omitting the words
'in writing'.

1. This chapter which deals with Geneva Convention awards has minimal applicability as more
than 108 nations ratified the New York Convention and less than five contracting States of
wsian ba nat hcama the uian atories to the New York Convention.
ALTERNATIVE DISPUTE RESOLUTION
ARBITRATION AND (S 54 S 55
ARB. & CONCL. ACT. 1996: GENEVA CONVENTION AWARDS 313
312
Section 53 read wl
that the present section i.e., Article 1 arbitrators but does not contain any provision for offensive petitions' as stated
It may be noted in Third Schedule, makes su
Convention reproduced an essential and maOn
to above, nor do the courts recognise or enforce such arbitration agreements. On the
of Geneva
arbitration in pursuance
of arbitration agreement, other hand, the Specific Relief Act, 1963 provides for only defensive' petitions
enforcement under the Ardtory
to quality for
of foreign award in such contracts or arbitration agreements to which Section 8 of the Arbitration
requirement
and Conciliation Act, 1996. and Conciliation Act would apply. Thus it forbids enforcement of contracts to
to refer partiee
Section judicial authority
54. Power of
in Part I or in
refer present or future differences to arbitration except under the Arbitration
arbitration.-Notwithstanding anything contained
to and Conciliation Act.
Code of Civil Procedure, 1908 (5 of 1908), a judicial authority, on ing
seized of dispute regarding contract made between
a persons to whons Award to be
'final'
or 'binding. There
is yet another substantial
difference between Section 54 relating to Geneva Protocol and Sectíon 45 which
Section 53 applies and including an arbitration agreement, whethe relates to New York Convention. In the former, the expression used is "the
or future difterences, which is valid
under that sectio
to
referring present award has become final"i whereas in the latter the expression is "the award
the parties on tho
and capable of being carried into effect, shall reter has become binding"2 The essence of the difference lies in the fact that
person claming through or under him
application of either of them or anyand "binding' award is an enforceable instrument as it has executory force without
such reference shall not prejudice
to the decision of the arbitrators any exequatur (leave for enforcement) by the State Court, but it is not final as
the competence of the judicial authority in case the agreement or the
arbitration cannot proceed or becomes inoperative. long as itis open to other means of recourse. The award becomes final under the
Geneva Convention in the country in which it has been made.
COMMENTS
This section corresponds to Section 45relating to New York Convention. The Section 55.beForeign awardsunder
whenthisbinding-Any foreign award
section makes it obligatory for the Courts to refer the parties to the decision of which would enforceable Chapter shall be treated as
binding for all purposes on the persons as between whom it was made,
the arbitrators. Article 4 of the Geneva Protocol reproduced in the Second and may accordingly be relied on by any of those persons by way of
Schedule enjoins upon-the Courts a duty to refer the parties to arbitration and defence, set off or otherwise in any legal proceedings in India and any
obtain a decision from the arbitrators instead of from the Court when any of the in this Chapter to enforcing a foreign award shall be construed
parties to the dispute/action makes an apPplication or 1equests to the Court
references
as including references to relying on an award.
seized of the dispute/action, provided the matter relates to the contract or
agreement made between persons. The validity of the agreement has to be COMMENTS
determined with reference to the provisions in Para I of the Geneva Protocol The purpose of inserting this section is to avoid the system of double
namely exequatur which existed in the earlier Geneva Convention of 1927. The section
(1) the parties to the agreement are subject respectively to the contemplates that the foreign award shall be treated as binding on the parties
jurisdiction of different States; as between whom it was made and it shall be enforceable in the country in
which it was made. The 'binding' nature of the award as envisaged by this
(2) the contract/agreement should relate to 'commercial matters or
any other matter capable of settlement by arbitration; and section refers to its effectiveness which should no longer be open to attack in the
arbitral procedure.
(3) there is no reservation as to limit of obligation only to contract
which are considered commercial under the national law. An award is regarded as binding when two conditions are fulfilled, namely
(1the award has been regularky made, and (2) when it complies with the
It is further to be noted that second
para of Article 4 of the Geneva Protocol formalities required for the arbitral award. Under the Indian law, an arbitral
provides that reference to arbitration shall not prejudice the competence of the award "shall be final and binding or the parties claiming under them
Courts i.e., judicial tribunals in case the
agreement or the arbitration cannot respectively." That is, the award when made binding automatically becomes
proceed or becomes inoperative. There is no such provision in final like a decree of the Court on expiry of the period for making an
Section 45 which relates to New York Convention. corresponding
application for setting aside of the award or on refusal of the application made
The Indian Arbitration law as also the under Section 34 of the Arbitration and Conciliation Act, 1996. In other words,
UNCITRAL's Model Law does not
contain any provison under which a it is no longer necessary to make an application in writing to the compétent
party to the arbitration
request the Court that the other party be ordered to refer agreement
may
court to make it binding or enforceable.
the dispute to
arbitration, even though the Court is not
the Arbitration and Conciliation yet seized of the dispute. Section 11 o 1. Article 1 (2) (d) of Geneva Convention reproduced in the THIRD SCHEDULE
Act, 1996 only provides for
appointment o
2. Article V Para 1 (e) of the New York Convention reproduced in the FIRST
SCHEDULE
ARBITRATION AND ALTERNATIVE
DISPUTE RESOLUTION
S. 56 S. 571 ARB. &CONCL ACT, 1996: GENEVA CONVENTION AWARDS 315
314

(b) the subject-matter of the award is capable of settlement

Section 56. Evidence.--(1) The party applying for the enforcement of
arbitration under the Law of India;
by
S.y

aforeign award shall, at the time of aPplication, produce before the (c) the award has been made by the arbitral tribunal provided for
Court in the submission to arbitration or constituted in the manner
(a) the original award or a copy duly authenticated in tho
thereof agreed upon by the parties and in conformity with the law
manner required by the law of the country in which it was S.S9
governing the arbitration procedure;
made;
has become final; and (d) the award has become final in the country in which it has been
(b) evidence proving that the award
(c) such evidence as may be necessaryto prove that the d made, in the sense that it will not be considered as such if it is
open to opposition
conditions mentioned in clauses (a) and (c) of sub-section (1)
or
appeal or if it is proved that any
proceedings for the purpose of contesting the validity of the
of Section 57 are satisfied award are pending;
(2) Where any document requiring to be produced under sub-section
(1) is in a foreign language, the party seeking to enforce the award shal (e) the enforcement of the award is not
contrary to the public
produce a translation into English certified as correct by a diplomatic or
policy or the law of India.
consular agent of the country to which that party belongs or certified as Explanation.-Without prejudice to the generality of clause (e), it is
correct in such other manner as may be sufficient according to the law in hereby declared, for the avoidance of any doubt, that an award is in
force in ndia. conflict with the public policy of India if the making of the award was
induced or affected by fraud or corruption.
Explanation.-In this section and all the following sections of this
Chapter, "Court' means the principal Civil Court of original jurisdiction (2) Even if the conditions laid down in sub-section (1) are fulfilled,
in a district, and includes the High Court in exercise of its ordinary enforcement of the award shall be refused if the Court is satisfied that
original civil jurisdiction, having jurisdiction over the subject-matter of the
(a) the award has been annulled in the country in which it was
award if the same had been the subject-matter of a suit, but does not
includeany Civil Court of a grade inferior to such principal Civil Court, made;
or any Court of Small Causes. (6) the party against whom it is sought to use the award was not
COMMENTS given notice of the arbitration proceedings in sufficient time to
enable him to present his case; or that, being under a legal
While the preceding Section 55 refers to the binding nature of the incapacity, he was not properly represented;
foreign
award for all the purposes including by wayof defence, set-off or otherwise,
Section 56 deals with the method of proof. The burden of proof under this
(c) the award does not deal with the differences contemplated by
of the to arbitration or
section is on the party applying a
for the enforcement foreign award.
of or falling within the terms submission
Sub-section (2) provides that where any document required to be produced
that it contains decisions on matters beyond the scope of the
submission to arbitration:
under sub-section (1) is in a foreign language, the party seeking enforcement of
the award shall produce an English translation of the document duly certified Provided that if the award has not covered all the differences
as correct by a submitted to the arbitral tribunal, the Court may, if it thinks fit, postpone
diplomatic or consular agent of the country to which the party such enforcement or grant it subject to such guarantee as the Court may
belongs. decide.
For the purposes of clause (b) of sub-section (1) of this section an award
shall not be deemed final if any (3) If the party against whom the award has been made proves that
proceedings for the purpose of contesting the under the law governing the arbitration procedure there is a ground, other
validity of the award are pending in the country in which it was made.
than the grounds referred to in clauses (a) and (c) of sub-section (1) and
Section 57. Conditions for enforcement of foreign awards.-(1) In clauses (b) and (c) of sub-section (2) entitling him to contest the validity
order that a
foreign award may be enforceable under this Chapter, it shall of the award, the Court may, if it thinks fit, either refuse enforcement of
benecessary that: the award or adjourn the consideration thereof, giving such party a
(a) the award has been made in pursuance of submission to reasonable time within which to have the award annulled by the
arbitration which is valid under the law competent tribunal.
applícable thereto;
60) ARB.& CONCL. ACT, 1996:GENEVA CONVENTION AWARDs 317
316 ARBITRATION AND ALTERNATIVE DISPUTE RESOLUTION
S. 58 COMMENTS
The enforcement of a foreign award may be refused if the
COMMENTS rnishes evidence before the Court that applicant
The section lays down the conditions
for enforcement of a foreign award. In hetween the parties was invalid or thatthetheagreement which was entered into
order to be an enforceable
foreign award, the award must have been tapacity stated in Section 57 (2) or that theparty was
party
suffering from some
did not receive
of
pursuance the submission to arbitration and the submission of the made in notice of the appointment of arbitrator or arbitral proper
be on an arbitrable award must proceedings or was otherwise
unable present the case. The other provisions relating to enforcement of
to
conditions of refusal todispute/difference.
The
enforce a foreign award.section
also enumerates
The circumstances the foreign award are similar to those of the domestic award and there is n0
refusal by the Court must be justifying difference insofar as the enforcement of award is concerned.
the enforcement of the proved beyond doubt to get an order of refusal of
foreign award. Section 59. Appealable orders.-(1) An appeal shallI lie from the
Refusal to enforce Foreign Award order refusing:"
Proviso to sub-section (2) and sub-section (3) of Section
57 lays down (a) to refer the parties to arbitration under Section 54; and
conditions in which enforcement of the (b) to enforce a foreign award under Section 57,
These conditions are
foreign award may be deferred or
postponed to the Court authorised by law to hear appeals from such order.
(1) Where the award does not cover all (2) No second appeal shall lie from an order passed in
Arbitral Tribunal, the Court if it
the differences submitted to the this section, but nothing in this section shall affect or take appeal
under
the award. The Court may, thinks. fit, postpone the enforcement of to appeal to the Supreme Court. away any right
may, however, allow enforcement of the award
such guarantee as the Court at its discretion subject to
may decide. COMMENTS
(2) Where the party against whom
the validity of the award on the award is made successfully contests This section limits the scope ofappeal against an order of the Court
the grounds
sub-section (1) of Section 57, the Court
stated in
clauses (5), (d) and (e) of refusing to recognise or enforce a foreign award. The section provides that an
at its
may,
enforcement of the award allowing the party reasonablediscretion adjourn the
time to get the award appeal shall lie against an order refusing to refer the parties to arbitration
annulled by the competent tribunal. under Section 54 or refusal to enforce the award by the Court under Section 57 of
Article 1 of the Arbitration and Conciliation Act, 1996. The section prohibits second appeal
the Geneva Convention on
the execution of the but this would not take away the right of the aggrieved party to move in
awardsTeproduced in the Third Schedule foreign arbitral
deals with recognition and
enforcement of the foreign awards. ItTeiterates that appeal to the Supreme Court against the order of the appellate Court.
an arbitral
be recognised or enforced under the Geneva award may not Section 60. Saving.-Nothing in this Chapter shall prejudice any
Convention
Hmade in a country which is not a signatory to the convention;(i),jf it has not been rights which any person would have had of enforcing in India of any
award is between persons who are not aubject to the or
(ii) if the award or of availing himself in India of any award if this Chapter had
state. It must, however, be emphasised jurisdiction of a
signatory
recognition and enforcement of the 'award' as -that-these-conditions refer to not been enacted.
arbitration agreement'. distinguished from the
COMMENTS
As regards the relevance of
nationality under the Geneva Convention as
contrasted with the New York Convention, the former
This section is a saving clause. Many of the rights of persons regarding
enforcement of would have become redundant or obsolete had
foreign award
to an arbitral award must requires that the parties a
in this Chapter. Therefore, the right for
latter would
belong to two different
signatory states whereas the this saving clause not been inserted
recognise and enforce an award even if only one party to the award enforcement of a foreign award by a person or availing himself in India of any
belongs to the signatory state. award has been preserved unless a different intention appears
in the repealing
Further, Article 2 of the Geneva Convention makes it Act.
Courts to refuse the mandatory for the
recognition and enforcement of an award which does not
comply with the condition laid down in Article 1 because the
'shall be refused' but the phraseology used in expression
the Article is used in
York Conventions is
Article V of New
'may be refused' which makes it discretionary for the
Court to refuse or not
the conditions
toTeruse the recognition and enforcement of the award if
specified are not
complied with.
Section 58. Enforcement of
satisfied that the foreign award isforeign awards.-Where the Court is
enforceable
award shall be deemed to be a decree of under this Chapter, the
the Court.