Enforcement of Foreign Arbitral Award in India

The debaters in the sphere of the commercial market prefer arbitration as an amicable measure for resolving disputes rather than concluding litigation cases which are usually considered a lengthy process. The right developed pursuant to the arbitral award can be of several natures and may be needed to be executed in other countries as the case may where the right ensued by the arbitral award lies. Section 44 of the Arbitration and Conciliation Act, 1996 (hereinafter appertained to as “the Act”) defines “foreign award” as an arbitral award on differences between persons arising out of Legal connections, whether contractual or not, that are supposed commercial under Indian law and were formed on or after October 11, 1960. The clause also stipulates that the provisions must be in agreement with the written agreement for arbitration to which the first schedule's convention applies and in one of the similar homes as the Central Government, being satisfied those complementary provisions have been made may, by the announcement in the sanctioned Review, declare to be territories to which this Convention applies. Recognition of foreign awards Rights mentioned in an arbitral award can be executed only after the prosecution of the Arbitral award in that third country. Section 46 of the Act stipulates the grounds as to when a similar foreign award would be binding on the parties. Any enforceable foreign award shall be treated as binding for all purposes on persons by means of defense, set off, or any other purpose in any legal proceedings in India, according to the clause. Hence, an Award may be recognized without being executed, but if it's executed, also it's inevitably recognized. Evidence Section 47 of the Arbitration and Conciliation Act provides the demand as to the evidence, which is needed for enforcement of the Arbitral Award. According to the said section of the Act, any person applying for administering an award in India shall produce before a similar court • the original award or a dupe thereof, similar substantiation as may be needed to prove that the award is a foreign award, • the operation is to be filed in the court where the subject matter of an award lies. For illustration, the subject matter of an international arbitration is a patenting agreement between the parties, and the award provides certain other reliefs which are related to the intellectual property of If one of the parties is in a third country and neither party has any actionable means or claims, the foreign arbitral award may need to be executed in that third nation. It can be claimed that a judgment debtor's annuity to relief conferred by a foreign arbitral award cannot be used in a third nation until the foreign award is executed in that country. When a foreign award is executed in a given country, it becomes a court's decree, and the rights conferred by that decree can be executed. Thus, the notion of enforcement of the award in a country where there's no place of business for any of the parties has been bandied and examined by various courts considering the compass and governance of similar courts. Scope of Jurisdiction In the case of Tata International Ltd v. Trisuns Chemical Assiduity Ltd, the Bombay High Court held that the subject matter of the arbitration would be considered by the court in arbitration, and in the enforcement of an award, the court would consider the subject matter of the award. The policy was that the arbitration might be over a specific contract or a specific piece of property. The Courts' territorial jurisdiction would be based on where the contract was signed or where the replier's property was located. The subject matter of the award will play a role once the arbitration is completed and must be executed. That is, an analysis of whether the award is a plutocrat award, a protestation award, or something else based on contract or property. It would be pointless to initiate an enforcement action where a cause of action has arisen if the replier does not have any property in that governance, because the court may only grant relief in the prosecution of an award if the respondent has immovable/movable property in that governance. In the case of Brace Transport Corporation of Monrovia, Bermuda vs. Orient Middle East Lines Ltd. Saudi Arabia & Ors., the Supreme Court held that the arbitration between the parties should take place in a neutral setting. Under the supervision of a neutral forum, the parties may not have any assets. As a result, the award cannot be carried out there. Rather, the award must be enforced in the nation where the judgment debtor's property is located. As a result, it is often argued that the foreign awards must be recognized and enforceable worldwide and that the position of such enforcement would be established by the facts of each case, rather than by the parties. Conclusion From the above discussion we can conclude that the settled principle in the governance of a international arbitration is the fact that the right vested by a international award only when the foreign award is executed in the nation where it was produced can it be exploited in any country other than the one where it was made. In addition, territorial governance can be considered in light of the award's subject matter. Indian bar has made modest trouble in making the entire process of recognition and enforcement of foreign awards smooth. Still, India has to work towards building a proenforcement governance while working in consonance with the spirit of Article V of the New York Convention, 1958. The recent decision in Vijay Karia and Centrotrade is a step forward towards having a more conducive enforcement medium in place. Author - Adv Reena Singh, Former Additional Advocate General Of UP, Supreme court of India

Enforcement of Foreign Arbitral Award in India