ROLE OF COURT BEFORE AND DURING ARBITRATION
Damodaram Sanjivayya National Law University, email@example.com
One of the main objectives of enactment on Arbitration and Conciliation in 1996 is minimising the supervisory role of the courts in arbitral process. The Statement of Objects and Reasons contained in the Arbitration and Conciliation Bill, 1995 emphasized the objective of minimisation of the interference of the courts in arbitration process. In accordance with the provisions of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as “the Act, 1996”) the interference of the courts is very limited in matters relating to arbitration except in specified circumstances as compared to the old Act, of 1940. Moreover, the interference of the courts can be termed as court assistance instead of saying court interference. The Court will not come in the way of arbitration matters at all from the commencement of arbitration proceedings till the arbitral award is made. Section 5 of the Act, 1996 provides for the extent of judicial intervention which says that “notwithstanding anything contained in any other law for the time being in force, in matters governed by this Part, no judicial authority shall intervene except where so provided in this Part”.. Therefore, the judicial intervention has been restricted and minimised. Under Section 5, the words used are “Judicial Authority” which is a wider term than the word “Court” and judicial authority includes all such authorities/agencies conferred with the judicial powers of the Government.
AIM AND OBJECTIVES:
The main objective of this projection is to analyse the role of Courts and judicial intervention before and during arbitral process in Domestic law as well as International Commercial Arbitration.
SCOPE AND LIMITATIONS:
Due to the vastness of this topic and the materials available, the scope of this project has been limited to Role of courts before and during arbitration.. Further, the project only tries to analyse the role of the courts and judicial intervention not going much into international arbitration and not tries to touch the various other issues involved with the concept of Arbitration law.
A mix of analytical and descriptive methodology has been used in this project in trying to answer the various research questions by analysing the various provisions of Arbitration and Conciliation act and the hitherto followed conventions New York Convention and Geneva Convention.
The main research question is whether a court is silent before and during arbitral proceeding and how far it plays a role which is included in Domestic law. Can a court interfere with the remedy granted by the tribunal.
SOURCES OF DATA:
The researcher has primarily used secondary sources of data like books, articles, seminar papers, unpublished essays and web sites in this project.
SIGNIFICANCE OF STUDY.
The main significance is to analyse whether the main objective of Arbitration and conciliation Act 1996 is achieved or not i.e. to minimise the intervention of court in the arbitral proceedings. While analysing researcher will conclude or will come with an outcome how far the main objective is achieved with various case laws.
K Ravi Kumar, ‘Alternative Dispute Resolution in Construction Industry’, International Council of Consultants (ICC) papers dealt with the History of Arbitration and how arbitration came into existence
Dr. S.C Tripathi, ARBITRATION AND CONCILIATION ACT, 1996 With Alternative means of Settlement of Disputes dealt in his book about the preamble of the Act and specified that preamble clearly states that there is no provision for reference of the matter to the arbitrator by intervention of the court but for enforcing the award one can approach the court.
Prof. Dr. Dagmar Coester-Waltjen, Constitutional Aspects of Party Autonomy and its Limits – the Prospective of Law dealt with general principles of arbitration Law.
A BRIEF HISTORY OF ARBITRATION LAW IN INDIA
Arbitration has a long history in India. In ancient times, people often voluntarily submitted their disputes to a group of wise men of a community—called the panchayat—for a binding resolution. Modern arbitration law in India was created by the Bengal Regulations in 1772, during the British rule. The Bengal Regulations provided for reference by a court to arbitration, with the consent of the parties, in lawsuits for accounts, partnership deeds, and breach of contract, amongst others. Until 1996, the law governing arbitration in India consisted mainly of three statutes: (i) the 1937 Arbitration (Protocol and Convention) Act, (ii) the 1940 Indian Arbitration Act, and (iii) the 1961 Foreign Awards (Recognition and Enforcement) Act. The 1940 Act was the general law governing arbitration in India along the lines of the English Arbitration Act of 1934, and both the 1937 and the 1961 Acts were designed to enforce foreign arbitral awards (the 1961 Act implemented the New York Convention of 1958). The government enacted the Arbitration and Conciliation Act, 1996 (the 1996 Act) in an effort to modernize the outdated 1940 Act. The 1996 Act is a comprehensive piece of legislation modelled on the lines of the UNCITRAL Model Law. This Act repealed all the three previous statutes (the 1937 Act, the 1961 Act and the 1940 Act). Its primary purpose was to encourage arbitration as a cost-effective and quick mechanism for the settlement of commercial disputes. The 1996 Act covers both domestic arbitration and international commercial arbitration.
PREAMBLE OF ARBITRATION AND CONCILIATION ACT, 1996
In preamble and in the Arbitration and Conciliation Act, 1996 there is no provision for reference of the matter to the arbitrator by intervention of the court. However if during pendency, there is agreement between the parties, they can proceed according to the provisions of the new Arbitration and Conciliation Act, 1996 and when award is made it is a decree which cannot be filed in the High Court rather it has to be filed according to section 2(e) of the said Act.
Simarly, the Apex Court in P. Anand Gajapathi Raju v. P.V.G Raju, has held that there is no provision in the new Act for referring the matter to an arbitrator by intervention of the court. However, if during the pendency of the proceedings in the court parties have entered into an arbitration agreement then they have to proceed in accordance with the provisions of the new Act and when award is made it is a decree and it cannot be filed in High court and it has to be filed in the court as defined in clause € of section 2 of the new act for its enforcement as a decree under section 36 of the new Act. If there is challenge to the award recourse has to be taken under Section 34 of the Act.
THE UNCITRAL MODEL LAW
The most important step of all in the development of the supportive modern approach was the promulgation by UNCITRAL of the Model Law, which has now been adopted in some form or another in over 60 countries. Article 5 of the Model Law significantly limits the occasions for Court intervention in arbitral matters. As is well known Article 5 provides that, “In matters governed by this law, no Court shall intervene except where so provided in this law
The new law on arbitration and conciliation was enacted in the year 1996 basing on the UNCITRAL Model Law and Rules. The Act, 1996 repealed the old Act, 1940, legislation on foreign awards basing on the Geneva Protocol and Convention and New York Convention. The Act, 1996 is unique in its nature as it contains comprehensive provisions on various issues relating to domestic arbitration, conciliation, international commercial arbitration, conciliation and recognition and enforcement of foreign awards basing on the Geneva and New York Conventions. The main objectives of making this legislation are to cover comprehensively international commercial arbitration and conciliation as well as domestic arbitration and conciliation, to make comprehensive procedure for arbitral process, to provide that the arbitral tribunal gives reasons for its award, to ensure that the arbitral tribunal remains within its limits of jurisdiction, to minimise the supervisory role of courts in arbitration, to permit the arbitral tribunal to use the other methods of alternative dispute resolution mechanisms, such as mediation and conciliation during the course of arbitral proceedings for settlement of disputes, to make the provision that the arbitral award is to be enforced as a court decree and to give similar status to the settlement arrived at , during the course of arbitral proceedings.
ROLE OF COURT BEFORE AND DURING ARBITRATION
Section 5 of the Act, 1996 provides for the extent of court intervention which says that “notwithstanding anything contained in any other law for the time being in force, in matters governed by this Part, no judicial authority shall intervene except where so provided in this Part”. The word “Part” referred to in this Section is Part I of the Act, 1996 which shall apply were the place of arbitration is in India (Section 2(2)) and shall not affect any other law for the time being in in force by virtue of which certain disputes may not be submitted to arbitration (Section 2(3). Therefore, the judicial intervention has been restricted and minimised. Under Section 5, the words used are “Judicial Authority” which is a wider term than the word “Court” and judicial authority includes all such authorities/agencies conferred with the judicial powers of the Governement. The judicial authority’s intervention under the Act, 1996 is limited to the purposes as prescribed by the Act, itself. The Act, 1996 provides for intervention or assistance of the judicial authority in respect of the following matters:
Making reference in a pending suit(Section 8)
The heading of the section is “power to refer parties to arbitration where there is an arbitration agreement”. This refers to the power which can be exercised by the judicial authority which is a wider term and includes court. This is one of the important provisions since it encourages parties to go for arbitration instead of resorting to settle the matters through courts. If any of the parties to the arbitration agreement approaches the court, without referring their matter to the arbitrators in spite of the existence of arbitration agreement, the other party can make an application to the court and the court can pass order to refer the parties to arbitration. The party making application has to submit the same before submitting his first statement on the substance of the dispute alongwith the original arbitration agreement failing which a duly certified copy thereof. Therefore, the following four conditions are to be satisfied under this Section:
- There should be arbitrationagreement,
- A party to the agreement brings an action before the court against the other party;
- The subject matter of action is the same as the subject matter of the arbitrationagreement
- The other party moves the court for referring the parties to arbitration it submits its first written statement on the substance of the dispute.
(ii). Passing of interim orders(Section 9)
Under section 9 of the Act, 1996 interim relief may be sought by a party before or during arbitral proceeding or any time after the making of the award but before the enforcement of the award. As in the case of actions brought by the people before courts for interim orders pending passing of the final order, the parties to the arbitration agreement may seek interim reliefs or orders pending final arbitral award by the arbitral tribunal, for the purposes as provided in the Act, 1996 by making an application. The provisions of Section 9 of the Act, 1996 are on the lines of Article 9 of the UNCITRAL Model Law and also Section 41 of old Act, 1940.
The purposes for which the interim reliefs can be sought from the court are as follows:
- For the appointment of a guardian for a minor or a person of unsound mind for the purposes of Arbitral proceedings
ii For an Interim measure of protection in respect of any of the following matters, namely:-
- the preservation, interim custody or sale of any goods which are the subject matter of the arbitration agreement
- Securing the amount in dispute in the Arbitration
- The detention, preservation or inspection of any property or thing which is the subject matter of the dispute in arbitration, or as to which any question may arise therein and authorising for any of the aforesaid purposes any person to enter upon any land or building in the possession of any party, or authorising any samples to be taken or any observation to be made, or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full information or evidence;
- Interim injunction or the appointment of a receiver;
- Such other interim measure of protection as may appear to the court to be just and convenient
The court is having power to issue interim orders as it issues orders in the ordinary civil suits. The court is not having power to issue orders for staying or suspending the arbitration proceedings during the period when the application for interim reliefs is pending. The court will not interfere if the parties commence the arbitration proceedings and the arbitrators give the arbitral award. It may be noted that the application can be made before the court even before commencement of arbitration proceedings in accordance with the provisions of Section 21 of the Act, 1996 (as held in Sundaram Finance Limited Vs. NEPC India Limited., 1999 2 SCC 479). However, the court has to be satisfied that there is a valid arbitration agreement is existence and applicant intends to take the dispute to arbitration. The court can also order for interim reliefs and measures under the Section 9 in the case of international commerical arbitration also in spite of having the place of arbitration outside India and in spite of having a provision under Section 2 (2) stating that this Part (Part I) apply where the place of arbitration in India.
It was held in the case of BHATIA INTERNATIONAL VS BULK TRADING S. A. & ANR, CASE NO.:Appeal (civil)6527 of 2001
“It must be borne in mind that the very object of the Arbitration and Conciliation Act of 1996, was to establish a uniform legal framework for the fair and efficient settlement of disputes arising in international commercial arbitration. The conventional way of interpreting a statute is to seek the intention of its makers. If a statutory provision is open to more than one interpretation then the Court has to choose that interpretation which represents the true intention of the legislature. This task often is not an easy one and several difficulties arise on account of variety of reasons, but at the same, it must be borne in mind that it is impossible even for the most imaginative legislature to forestall exhaustively situations and circumstances that may emerge after enacting a statute where its application may be called for. It is in such a situation the Courts’ duty to expound arises with a caution that the Court should not try to legislate. While examining a particular provision of a statute to find out whether the jurisdiction of a Court is ousted or not, the principle of universal application is that ordinarily the jurisdiction may not be ousted unless the very statutory provision explicitly indicates or even by inferential conclusion the Court arrives at the same when such a conclusion is the only conclusion. Notwithstanding the conventional principle that the duty of judges is to expound and not to legislate.
(iii). Appointment of arbitrators (Section 11)
Parties desirous of referring their dispute are at full liberty to appoint the arbitrators of their choice. The number of arbitrators shall not be even number. If the parties does not agree on the procedure for appointment of arbitrator or arbitrators, each party shall appoint an arbitrator and the two appointed arbitrators shall appoint the third arbitrator who shall act as the presiding Arbitrator, in an arbitration with three arbitrators.
In case of failure on the part of a party to appoint his arbitrator within 30 days from the receipt of the request to do so from the other party or the two appointed arbitrators fail to agree on the third arbitrator within 30 days from the date of their appointment, the appointment shall be made upon request of a party, by the Chief Justice of High Court (in case of domestic arbitration) or any person or institution designated by him or Chief Justice of India (in case of international commercial arbitration) or any person or institution designated by him. It may be noted that the appointing authority viz., the Chief Justice of a High Court his designate and Chief Justice of India or his designate as the case may be, is not court.
Section 16, 37 – Issue of jurisdiction – Competence of arbitral tribunal.
Issue of jurisdiction – Arbitral Tribunal may rule on its own jurisdiction including an objection with respect to the existence or validity of the arbitration agreement, etc. – Order of Arbitral Tribunal holding that it has jurisdiction can be challenged only after the arbitration proceedings are over and the award is made – Learned Single Judge rightly held that the Petition was premature. Result: Appeal dismissed.
Section 34 – Setting aside of award – Non speaking award.
Arbitration award – Absence of reasons – Obligatory on the part of the Arbitral Tribunal to have given the reason unless the parties agree for dispensing with the reasons or where the Award is based on a settlement between the parties – Document not containing reasons upon which it is based though signed by the arbitrators and making adjudication of the dispute referred to them cannot be termed as an Award – No question of setting aside the same arises under section 34 of the Act.
GENERAL PRINCIPLES OF ARBITRATION LAW
(a) Party Autonomy
The party autonomy principle forms the foundation of arbitration law. Party autonomy is an established principle of law both in common law as well as in civil law. The philosophy that outlines the party autonomy is that the contract between the parties is the fundamental constituent of international arbitration and that it is the party’s common intention which confers powers upon the Arbitrators. This self ordering of legal relation between individuals by the will of the parties as embodied in the contractual agreement must be given primacy in the arbitral process and hence, implying the private and consensual nature of arbitration.
Article 16 of the UNCITRAL Model Law of International Commercial Arbitration which has been legislatively enacted in Section 16 of the Arbitration & Conciliation Act, 1996 (hereinafter “1996 Act” or “the Act”) embodies the kompetenzkompetenz (or competence de la competence) rule which expressly gives the Arbitral Tribunal the power to rule on its own jurisdiction and including on the validity of the arbitration agreement. This rule has been interpreted to imply a “chronological priority” and hence, the rule does not mean that the tribunal would be the sole judge of jurisdiction but merely the first judge. Therefore, Courts may review the jurisdictional decision, albeit on the limited grounds provided, at the setting aside and enforcement stages of the arbitration. This rule can be found in a myriad of institutional rules, domestic arbitration legislations, conventions, arbitral awards, judicial decisions and in scholarly writing.
(c) Minimising Judicial Control
Another facet of the kompetenz-kompetenz doctrine is that it empowers an judicial authority, when prematurely seized of the issue of the tribunal’s jurisidiction, to confine itself to the existence of an arbitration agreement and refer the dispute to arbitration. The Court’s satisfaction is generally of a prima facie existence of the arbitration agreement and deferring final adjudication of jurisdictional issues like validity and existence to the arbitral tribunal.Thereby, implying a minimal amount of judicial control in arbitration. In fact, the Statements and Objects of the 1996 Act was to “minimise judicial control”. Further, scholarly opinion is of the view that the decision by the Court to decline the case is purely of an administrative nature which extends to the case where there is no documentary proof of an agreement to arbitrate. Section 34 of the 1996 Act envisage challenge and setting aside of the arbitral award only on limited grounds. Hence, an arbitral award cannot be impeached on merits. Therefore, consideration of questions on the correctness of the award on law and on facts by the Court is not permitted.
(a) The Bhatia International Conundrum
Section 2(2) of the Act provides that Part I of the Act would apply to arbitrations which take place in India. Therefore, the recourse to set aside an award under Section 34 cannot be made in case of international commercial arbitration held outside India. This prevents Courts from interfering with arbitrations overseas. But in Bhatia International v. Bulk Trading, the Supreme Court held, that Part I of The Act is applicable even to international commercial arbitrations, where the place of arbitration is outside India. Since the wording of Section 2(2) of the 1996 Act only provides that Part I would apply to arbitrations which take place in India and does not expressly provide that Part I will not apply to international commercial arbitrations which has its designated seat outside India, the Court read it as legislative intent for Part I to apply non-compulsorily to international commercial arbitrations held outside India, i.e. the same could be excluded by agreement of the parties.
The Court in applying Part I to foreign awards, has taken a consequentialist view, protecting the party in need of an interim measure from being left “remediless” in case the arbitration is held in a non-convention country as Part II only applies to awards rendered in awards rendered in convention countries. But while protecting the illusive remedy the Court engaging in heavy interpretivism, has overlooked a possible negative consequence. While conservatory measures which aid the arbitral process may not be harmful, challenge to the award under Section 34 when the award has been rendered in another place is unwarranted and adds an element of extraterritoriality to the Indian Courts.
This has currently resulted in a theoretical situation wherein Indian Courts can set aside arbitral awards rendered outside India and the law governing the arbitration not being the law of India. The effect of the decision is, therefore, disastrous and runs contrary to the principle of party autonomy as the party intent as envisaged by the original arbitration agreement or clause is defeated. However, the law still remains in a state of uncertainty as some decisions have followed Bhatia International principle, while others have refused to do so inspite of the binding nature of the decision.
(b) O.N.G.C. v. Sawpipes: Broad Discretionary View of “Public Policy”
The division bench of the Supreme Court of India in ONGC v. Sawpipes, had the opportunity to examine and rule upon the, the scope and ambit of the Court’s jurisdiction where an arbitral award has been challenged under Section 34 of the Arbitration & Conciliation Act, 1996. Section 34(2)(b)(ii) allows the Courts to set aside an arbitral award, inter alia, if it is contrary to “Public Policy”.
The term “Public Policy of India” has not been defined in the Act. Therefore, the Court opined that since the term “Public Policy” does not find precise definition it must be construed with a wider and narrower meaning depending upon the context and the principles governing Public Policy are capable of expansion and modification. It was observed that an award would be deemed to be against the Public Policy of India if it is contrary to the fundamental policy of Indian law, the interests of India, justice or morality or is patently illegal. The Award may be set aside if it shocks the conscience of the Court. The Court thus, took the three heads of ‘Public Policy’ as formulated in Renusagar and added the last head of “patent illegality”. The Court held that “if the award is patently against the statutory provisions of substantive law” then it would be “patently illegal”. This broader view of Public Policy in effect allows a review of the arbitral award on merits making the judiciary an appellate body over arbitral awards. The Court in the case held that, the violation of mere statutory provisions of law would amount to being against the “Public Policy” of India.
The Court’s conception of “Public Policy” gives discretion of when to consider it widely and when to restrict its scope, thereby rendering unpredictable challenge or enforcement of any award. Therefore, the Court rejected the “narrow view” taken by “Public Policy” as had been established by Renusagar. The scope of review for setting aside an award can thus, be only on minimal grounds and not on merits. Setting aside for not following statutory provisions is a consideration in law and fact amounting to a review on merits which is not permitted.
(c) Patel Engineering: Kompetenz-Kompetenz Demolished
Ideally the kompetenz-kompetenz rule read with minimal judicial control as envisaged in Sections 5 and 8 of the Act would mean that jurisdictional issues including those of validity of the arbitration agreement should be decided by the Arbitral Tribunal. In fact, Section 5 states “no judicial authority shall intervene except where so provided in this Part”. The Supreme Court in Nimet Resource Inc. v. Essar Steels Ltd., held that when there is a dispute as to the existence or nonexistence of an arbitration agreement, the appropriate course of action would be that the arbitrator should decide such a question under Section 16 rather than the Chief Justice or his nominee under Section 11. This was contrary to the Supreme Court’s earlier views in Wellington Associates Ltd. v. Kirit Mehta, wherein the Court held that the jurisidiction of the nominee of the Chief Justice of India to decide the question is not excluded by the section, and such a power can be exercised in suitable cases. In Shin-Etsu Chemical Co. Ltd. v. Aksh Optifibre Ltd., the Supreme Court ruled that the validity of an arbitration agreement would be decided by a Court under Section 45 of the Act, only on a prima facie basis.
However, recently a Seven Judge bench of the Supreme Court in S.B.P. & Co. v. Patel Engineering Ltd., held that the Chief Justice, while appointing Arbitrators under Section 11 of the Act, may give a binding decision as to the validity of the arbitration agreement. The effect of this decision has the significant dilution of the kompetenz-kompetenz rule which leaves questions on jurisdiction, including validity of the arbitration agreement for Arbitral Tribunal’s decision. It is more appropriate for the Arbitrators should be allowed to be first judges of jurisdiction, as this would be in consonance with the minimal judicial control envisaged by modern arbitration. Judicial review of the jurisdictional decision should only be at the setting aside or enforcement stage. But allowing the Chief Justice to pass jurisdictional orders amounts to judicial control other than as provided under the Act i.e. for setting aside and enforcement of award. This conclusion is in blatant contradiction of the legislative intention as signified from the non-incorporation of the power to decide on issues of validity, which incidentally is present in Article 8 of the UNCITRAL Model Law. However, the Court held the fact that, the Arbitral Tribunal has the competence to rule on its own jurisdiction and to define the contours of its jurisdiction only means that when such issues arise before it, the Tribunal can and possibly, ought to decide them. Thereby, the Court gave an unprecedented redefinition of the kompetenz-kompetenz rule being only a power of the tribunal to be exercised, when it is seized with the dispute not applicable Ironically, while in effect destroying the kompetenz-kompetenz rule reaffirms it by stating that Section 16 “makes explicit what is even otherwise implicit”.
CRITICAL ANALYSIS OF JUDICIAL TREND OF INTERFERENCE
(a) Key Issues of Doctrine and Policy
Prof. O.P. Malhotra identifies four “basic features” of arbitration as firstly an alternative to court litigation, secondly a confidential dispute resolution mechanism, thirdly agreed and controlled by parties and lastly as a final and binding determination of the rights and obligations of the parties. Therefore, in advocating higher judicial control amounting to interference, these decisions analysed, which preaches a higher level of judicial control violate the idea behind each of these “basic features” of arbitration. Lord Mustill writes in his foreword to Prof. Malhotra’s treatise on “Arbitration Law”, questions whether policy of exercising extra-territorial power to interfere with arbitrations overseas is in the long term “interests of India” and states the need to follow the broader interests of India’s economic environment and not the Narrow interests of Indian parties suffering from adverse decisions.  In fact, Russel’s conception of arbitration envisages arbitration as the never-ending conflict between two irreconcilable principles – the high principle which demands that justice be done though the heavens fall, and the low principle which demands that there shall be an end to litigation. Courts justify greater judicial control on the basis of the former but a more pragmatic solution for the business community would be the latter principle. Therefore on a policy level, it is much more pragmatic in the interests of speed and efficiency of arbitration to allow a great degree of autonomy to the Tribunal
The system of dual agency for providing relief needs to be abolished or some enforcement mechanism must be provided for enforcement of the interim measures of protections ordered by the Arbitral tribunal. It would be better that application of interim measures is to put to the arbitral tribunal as they are seized of the subject matter under dispute. Only when a party is not able to get relief from arbitral tribunal, it should be allowed to approach the domestic Courts. This will be in line with the objectives of the Act to minimise the intervention of the Court in arbitral proceedings.
OUTCOME OF THE PROJECT
The researcher found that In spite of limited and minimised intervention by the courts, much delay is taking place in arbitral proceedings. There should be certain time limit for making the award preferably six months from the date of commencement of the arbitration proceedings. There should be clear provisions in the Act, 1996 about issue of orders for interim measures/reliefs in case of international commercial arbitration where the place of arbitration is not in India and the property which is subject matter of the arbitration is situate in India. There should also be specific provision in the Act, 1996 providing for applicability of some of the relevant sections in Part I to the international commercial arbitration where the place of arbitration is not in India. The lacunae in the Act, 1996 with regard to ground for setting aside the award mentioned in Section 13 (4) which is not provided in the grounds under Section 34, is to be removed. Proper arrangements should be made for removal of biased arbitrators. Qualification and experience should be prescribed for the persons to be selected as arbitrators for making the award made by them, a decree of the court.
 K Ravi Kumar, ‘Alternative Dispute Resolution in Construction Industry’, International Council of Consultants (ICC) papers, www.iccindia.org. at p 2. K Ravi Kumar is assistant executive engineer, Salarjung Museum, Hyderabad
 The New York Convention of 1958, i.e. the 1958 Convention on the Recognition and Enforcement of
Foreign Arbitral Awards, is one of the most widely used conventions for recognition and enforcement of
foreign awards. It sets forth the procedures to be used by all signatories to the Convention. This
Convention was first in the series of major steps taken by the United Nation since its inception, to aid the
development of international commercial arbitration. The Convention became effective on June 7, 1959
 The 1996 Act, Section 85
 Justice Ashok Bhan in his inaugural speech delivered at the conference on ‘Dispute Prevention and
Dispute Resolution’ held at Ludhiana, India, October 8 2000, http://iis-db.stanford.edu/pubs/22693/No_103_Sarma_India_Arbitration_India_509.pdf, last accessed on 23-3-15 at 20:39
“Court” means the principal Civil Court of original jurisdiction in a district, and includes the High Court in exercise of its ordinary original civil jurisdiction, having jurisdiction to decide the questions forming the subject-matter of the arbitration if the same had been the subject-matter of a suit, but does not include any civil court of a grade inferior to such principal Civil Court, or any Court of Small Causes.
 2000(4) SCC 539
 Dr. S.C Tripathi, ARBITRATION AND CONCILIATION ACT, 1996 With Alternative means of Settlement of Disputes, Central Law Publication, Allahabad, 5th edition, pg. 17
 However, the mere adoption of the Model Law does not guarantee that judicial intervention will be limited. The Indian Arbitration & Conciliation Act embodies the Model Law including Article 5 but in Oil & Natural Gas Limited v Saw Pipes  3 Supreme 449:  2 Arb LR 5 the Supreme Court, in a much criticised judgment, enlarged the scope of challenge to awards to the point where the width of the challenges available were more than what had been available under the previous 1940 Act: PC Markanda Law Relating to Arbitration and Conciliation (5th Edition, Wadhwa and Co, New Delhi, 2003) at 2
 Edward brunet, Richard E. Speidel, Jean R. Sternlight and Stephen J. Ware, “Arbitration Law in America: A Critical Assessment” (2006), Cambridge University Press
 For Common Law: Atiyah, “The Rise and Fall of Freedom of Contract” Vol. 35(1979)
 Prof. Dr. Dagmar Coester-Waltjen, Constitutional Aspects of Party Autonomy and its Limits – the Prospective of Law, Kings College of Law Research Paper <http://www.kcl.ac.uk/depsta/law/research/ cel/events/99_00/internal_market/autonomy. last accessed on 24-3-15 at 14:17
 UNCITRAL Model Law on International Commercial Arbitration. Text <http://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/0654671_Ebook.pdf> last accessed on 24-3-15 at 14:21
 UNCITRAL Model Law on International Commercial Arbitration, art.16; Arbitration & Conciliation Act, 1996, Section 16
 Fouchard, Gaillard Goldman, supra note 17, at para.660
 UNCITRAL Arbitration Rules, 1976, Article 21; American Arbitration Association, Arbitration Rules, Article 15.1; International Chamber Commerce Arbitration Rules, Article 6.2; London Court of International Arbitration Rules, Article 23; ICC Rules, art. 6(2)
 European Convention on International Commercial Arbitration”, Geneva, 1961, Article 5(3); Convention on the “Settlement of Investment Disputes between States and Nationals of Other States” (Washington Convention), 1965, 575 UNTS 159, art. 41
 Dalmia Dairy Industries Ltd. (India) v. National Bank of Pakistan (1978) 2 Lloyd’s L Rep. 223
 Gaillard, Goldman, supra note 17, at paras.385, 625;
- Lawrence Craig, William W. Park, Jan Paulsson, “International Chamber of Commerce Arbitration” (2000), 3rd edn., Oceana Publications, Inc.
 UNCITRAL Model Law on International Commercial Arbitration, Article 8; Arbitration & Conciliation Act, Section 8
 Rules of Arbitration of the International Chamber of Commerce, 1998 <http://www.iccwbo.org/court/english/ arbitration/pdf_documents/rules/rules_arb_english.pdf> (last accessed on 24-3-15 at 14:32) [hereinafter ICC Rules]
 Statement of Objects & Reasons, para.(v). Infact the The Statement of Objects and Reasons attached to the Bill submitted to Parliament on May 8, 1995 relates that it is widely felt that the “1940 Act, which contains the general law of arbitration, has become outdated… . It is also recognized that our economic reforms may not become fully effective if the law dealing with settlement of both domestic and international commercial disputes remains out of tune with such reforms
 Toepfer International Asia Pvt. Ltd., Petitioner v. Thapar Ispat Ltd., 2000-(001)-ARB.L.R.-0230–BOM; Renusagar Power Co. Ltd. v. General Electric Co., MANU/SC/0001/1984: 1994 Supp. (1) SCC 644, at para.100 (“… such unjust enrichment must relate to the enforcement of the awards, and not to its merits, in view of the limited scope available to challenge the award before the Court. The Supreme Court also pointed out that the challenge on the ground of unjust enrichment raised by the appellant went into the merits of the case and is beyond the scope of objection that can be raised”)
 MANU/SC/0185/2002: (2002) 4 SCC 105
 Bhatia International v. Bulk Trading SA, (2002) 4 SCC 105 at para.21
 Country which is not a party to the New York Convention (Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958) or the Geneva Convention (Geneva Convention on the Execution of Foreign Arbitral Awards, 1927)
 Ispat Industries Ltd v. m.v. Thor Orchid, MANU/MH/0509/2004. 2004(3) R.A.J. 430 (Bom).
 Shreejee Traco (I) (P) Ltd. v. Paperline International Inc., (2003) 9 SCC 79
 ONGC v. Sawpipes, MANU/SC/0314/2003: (2003) 5 SCC 705
 Arbitration & Conciliation Act, 1996, Section 34(2)(b)(ii). Section 34(2)(b)(ii) states: “34. …(2) An arbitral award may be set aside by the court only if … (ii) The arbitral award is in conflict with the Public Policy of India
 Renusagar Power Co. Ltd. v. General Electric Co., MANU/SC/0001/ 1984: 1994 Supp. (1) SCC 644
 Id. at para.66.(The Court in Renusagar outlined three grounds of Public Policy. It held that: “Applying the said criteria 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
 Arbitration & Conciliation Act, 1996, Section 48(2)(b). Section 48(2)(b) states that: “48. … (2) Enforcement of an arbitral award may also be refused if the court finds that- … (b) The enforcement of the award would be contrary to the Public Policy of India.
 Renusagar Power Co. Ltd. v. General Electric Co., MANU/SC/0001/ 1984: 1994 Supp. (1) SCC 644:“[P]ublic policy” in Section 7(1)(b)(ii) [of the Arbitration (Protocol and Convention) Act 1937] has been used in a narrower sense and in order to attract to bar of Public Policy the enforcement of the award must invoke something more than the violation of the law of India
 Arbitration & Conciliation Act, 1996, Sec.5
 (2000)7 SCC 497
 AIR 2000 SC 1379
 Wellington Associates Ltd. v. Kirit Mehta, MANU/SC/0232/2000
 2005 (6) SCALE 561
 2005 (8) SCC 618
 While Sec.8 of the Arbitration & Conciliation Act, 1996 states: “A judicial authority before which an action is brought in a matter, which is the subject of an arbitration agreement, shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration.
 O.P. Malhotra & Indu Malhotra, “The Law & Practice of Arbitration & Conciliation 97, 98” (2nd edn., Lexis Nexis Butterworths, New Delhi, 2006) (2006), 2nd edn., Lesis Nexis Butterworths, New Delhi, pp. 97,98
 Fali S. Nariman, “Finality in India : the impossible dream”, (1994) 10 Arb. Int’l, pp. 373-384.