Assignment

on
Enforcement of Foreign Awards
Submitted in Partial Fulfillment of Requirement for the Internal Assessment of
Subject of Alternative Dispute Resolution (ADR)

Under the Supervision of

Ms. Sayantani Gupta
(Assistant Professor)
Department of Juridical Science
JIS University, Kolkata

Submitted by:
Name –
Subject – Alternative Dispute Resolution (Arbitration, Mediation,
Conciliation)
Subject Code- ZLA 6004
Roll no:
Session –

Department of Juridical Science

JIS University, Kolkata
2024
 ACKNOWLEDGEMENT

In the process of completing this assignment, I have been fortunate to receive the support and
assistance of many remarkable individuals and resources, without which this endeavor would not
have been possible.
First and foremost, I am deeply grateful to my professor, Ms. Sayantani Gupta for her insightful
notes and lecture. Her passion for the subject matter has been inspiring, and her feedback has
played a pivotal role in shaping the direction of this work.

I would also like to extend my appreciation to my friends and classmates who have engaged in
thought-provoking discussions and shared their diverse viewpoints, enriching my understanding
of the topic. My gratitude extends to my family for their constant encouragement and belief in
my abilities. Their unwavering support has been my anchor throughout this academic journey.
Furthermore, I would like to acknowledge the wealth of information available through various,
books, online platforms, and research databases. These resources have been instrumental in
expanding my knowledge and forming the foundation of this assignment.
In closing, I wish to express my thanks to all those who have contributed to this assignment
directly or indirectly. Their collective contributions have made a significant impact on the quality
and depth of this work.

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 Table of Abbreviations

AIR All India Reporter

Anr Another

Sec Sections

SC Supreme court

ADR Alternative Dispute Resolution

SLSA State Legal Services Authorities

SCC Supreme court cases

Pvt Private

Ltd Limited

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 LIST OF CASES

 Bharat Aluminum Company (BALCO) v. Kaisar Aluminium Technical Services Inc.

[(2012) 9 SCC 552]

 Venture Global Engineering v Satyam Computer Services (2008)

 Sundaram Finance Ltd. v. Abdul Samad and Anr. [(2018) 3 SCC 622]

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 INDEX
CONTENT………………………………………………………………….Pg No.

ABSTRACT…………………………………………………………………….5

INTRODUCTION………………………………………………………………6

ENFORCEMENT OF FOREIGN ARBITRAL AWARDS…………………….7

JURISDICTION – APPROPRIATE FORUM & LIMITATION……………….9

APPROPRIATE FORUM……………………………………………………….10

LIMITATION PERIOD…………………………………………………………10

SUGGESTIONS & CONCLUSION…………………………………………11-12

BIBLOGRAPHY………………………………………………………………..13

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 Abstract

In an increasingly interconnected global economy, the enforcement of foreign awards serves as a

linchpin for facilitating international commerce and dispute resolution. This assignment explores
the intricate process of recognizing and enforcing judgments or arbitral awards obtained in one
jurisdiction within another. Whether stemming from court judgments or arbitration proceedings,
the enforcement of foreign awards hinges upon a complex interplay of international conventions,
bilateral agreements, and domestic legal frameworks.

This delineates the multifaceted landscape of enforcement, shedding light on the legal principles,
procedural intricacies, and practical challenges inherent in cross-border enforcement efforts.
Through a systematic analysis, it elucidates key components such as the legal basis for
enforcement, procedural requirements, grounds for challenge, and available enforcement
mechanisms. Moreover, it delves into nuanced considerations including issues of sovereign
immunity, cross-border cooperation, and the role of reciprocity in facilitating enforcement
efforts.

Furthermore, it underscores the pivotal role of enforcement in bolstering confidence in

international trade and investment, by providing parties with a robust mechanism for upholding
their rights and obligations across jurisdictions. It emphasizes the importance of strategic
planning, legal expertise, and proactive engagement in navigating the enforcement process
effectively.

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 FOREIGN AWARD – ENFORCEABILITY

INTRODUCTION
Foreign Award means an arbitral award on differences between persons arising out of legal
relationships, whether contractual or not, considered as commercial under the law in force in
India. In order to be considered as a foreign award (for the purposes of the Act), the same must
fulfill two requirements.
 First it must deal with differences arising out of a legal relationship (whether contractual or
not) considered as commercial under the laws in force in India.
 Second requirement is that the country where the award has been issued must be a country
notified by the Indian Government to be a country to which the New York Convention or
Geneva Convention applies.
The provisions regarding conditions for enforcement of foreign awards made under the New
York Convention or the Geneva Convention are almost the same. Once an award is held to be
enforceable it is deemed to be a decree of the court and can be executed as such. Under the Act
there is no procedure for setting aside a foreign award. A foreign award can only be enforced or
refused to be enforced but it cannot be set aside.
Key considerations in the enforcement of foreign awards include understanding the legal basis
for enforcement, complying with procedural requirements, addressing potential challenges or
objections, and utilizing available enforcement measures effectively. Additionally, parties should
be mindful of issues such as sovereign immunity, cross-border cooperation, costs, and
timeframes associated with enforcement proceedings.

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ENFORCEMENT OF FOREIGN ARBITRAL AWARDS
Chapters (I and II) of Part II of the Arbitration and Conciliation Act, 1996 deal with the
enforcement of certain foreign awards made under the New York Convention and the Geneva
Convention, respectively.
Sec (44 and 53) of the Act define the foreign awards as to mean an arbitral award on differences
between persons arising out of legal relationship, whether contractual or not, considered
commercial under the law in force in India made on or after the 11th day of October 1960 in the
case of New York Convention awards and after the 28th day of July 1924 in the case of Geneva
Convention awards.
Awards made under New York convention or Geneva Convention
Any foreign award whether made under New York Convention or Geneva Convention, which
would be enforceable under the Act have been treated as binding for all purposes on the persons
as between whom it was made, and may accordingly be relied on by any of those persons by way
of defense, set off or otherwise in any legal proceedings in India.
Bharat Aluminum Company (BALCO) v. Kaisar Aluminum Technical Services Inc. [(2012) 9
SCC 552] The Constitutional bench of SC held that the Act of 1996 has accepted the territoriality
principle which has been adopted in the UNCITRAL Model Law. Sec 2(2) makes a declaration
that Part I of the Arbitration Act, 1996 shall apply to all arbitrations which take place within
India.
In the opinion of SC, the provisions contained in Arbitration Act, 1996 make it crystal clear that
there can be no overlapping or intermingling of the provisions contained in Part I with the
provisions contained in Part II of the Arbitration Act, 1996. In a foreign seated international
commercial arbitration, no application for interim relief would be maintainable under Sec 9 or
any other provision, as applicability of Part I of the Arbitration Act, 1996 is limited to all
arbitrations which take place in India.
In this case Hon’ble SC concluded that Part I of the Arbitration Act, 1996 is applicable only to
all the arbitrations which take place within the territory of India. This has now partly been
overruled by the 2015 Amendment Act.
Conditions for Enforcement of Foreign Awards [Sec (48 & 57)]
 The enforcement of a foreign award in India is a two-stage process which is initiated by
filing an execution petition.
 Initially, a court would determine whether the award adhered to the requirements of the
Act.

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  Once an award is found to be enforceable it may be enforced like a decree of that court.
[Sec (49 & 58)]

Requirements for enforcement of Foreign Award [Sec 47]

Sec 47 of the Act provides that the party applying for enforcement of foreign award “shall” at the
time of application produce before the court
1. The original award or a duly authenticated copy thereof;
2. The original arbitration agreement or a duly-certified copy thereof; and
3. Such evidence as may be necessary to prove that the award is a foreign award.
4. Where the award or agreement is in a foreign language, the party seeking to enforce
the award is required to produce a certified translated copy in English.
5. Where the Court is satisfied that the foreign award is enforceable, the award shall be
deemed to be a decree of that Court.
Foreign Award when not enforceable [Sec 48]
1. The Indian courts may refuse to enforce the foreign award on satisfactory proof of any
of the grounds mentioned in Sec 48(1) of the ACT, 1996, by the party resisting the
enforcement of the award. The provisions set out in Sec 48 are in the nature of defenses
available to the party resisting the enforcement application.
2. The party, against whom the award is invoked, may use any of the following grounds
as defense before the Court for the purpose of refusal of enforcement of the foreign
awards:
I. the parties were under some incapacity under the law applicable to them or the
arbitration agreement is not valid under that law; or
II. the party against whom the award is invoked was not given proper notice of the
appointment of the arbitrator or of the arbitral proceedings or was otherwise
unable to present his case; or
III. the award deals with a difference not falling within the terms of submission to
arbitration or
IV. the composition of the arbitral authority or the arbitral procedure was not in
accordance with the agreement of the parties or in the law of the country where
the arbitration took place; or
V. the award has not yet become binding, or has been set aside or suspended by a
competent authority of the country in which or under the law of which, the
award was made; or
VI. the subject-matter of the difference is not capable of settlement by arbitration
under the law of India; or
3. The enforcement of award would be contrary to the public policy of India. In the case of
Venture Global Engineering v Satyam Computer Services (2008), it was held by the SC that the

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new procedure of enforcement requires is that a person seeking to enforce a foreign award has
not only to file an application for enforcement u/s 48 of the 1996 Act, it has to meet an
application u/s 34 of the 1996 Act seeking to set aside the award. The new ground is that the
award pass the New York Convention grounds incorporated in Sec 48, it must pass the expanded
„public policy‟ ground created under sec 34 of the 1996 Act.

JURISDICTION – APPROPRIATE FORUM & LIMITATION

The Act does not confer jurisdiction on the Indian courts to annul an International Commercial
Award made outside India.
The power to annul an award is provided under sec 34 in Part I of the ACT, 1996. The
applicability of that provision is limited to the awards made in India or domestic awards. The
powers of the Indian courts to set aside an award relating to ICA are confined to those seated in
India. Therefore, Indian courts do not have jurisdiction to entertain a challenge to a foreign
award on its merits.
The SC Sundaram Finance Ltd. v. Abdul Samad and Anr [(2018) 3 SCC 622] clarified that an
award holder can initiate execution proceedings before any court in India where assets are
located. In case the subject-matter of the arbitration is of a specified value (not less than Rs. 1
crore), commercial courts established under the Commercial Courts, Commercial Division and
Commercial Appellate Division of High Courts Act, 2015 (“Commercial Courts Act”) would
have jurisdiction, as given below
A. Award arising out of an India seated arbitration (being an ICA)
By virtue of the Commercial Courts Act and the Amendment Act, the Commercial Division of a
High Court where assets of the opposite party lie shall have jurisdiction for applications relating
to enforcement of such awards if the subject matter is money. In case of any other subject matter,
Commercial Division of a High Court which would have jurisdiction as if the subject matter of
the award was a subject matter of a suit shall have jurisdiction, i.e., where the opposite party
resides or carries on business or personally works for gain.
B. Award arising out of an India seated arbitration (not being an ICA)
As per the Commercial Courts Act and the Amendment Act, for such cases, the appropriate court
would be the Commercial Court exercising such jurisdiction which would ordinarily lie before
any Principal Civil Court of original jurisdiction in a district, as well as the Commercial Division
of a High Court in exercise of its ordinary original civil jurisdiction.
C. Foreign Awards
Where the subject matter is money, the Commercial Division of any High Court in India where
assets of the opposite party lie shall have jurisdiction. In case of any other subject matter,
Commercial Division of a High Court which would have jurisdiction as if the subject matter of
the award was a subject matter of a suit shall have jurisdiction.

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APPROPRIATE FORUM
On a decree being passed, execution proceedings can be initiated for enforcement of the decree.
Sec (36 to 74) and Order XXI of the CPC set out the provisions in respect of execution. The
person in whose favor a decree has been passed or an order capable of execution has been made
is known as a “decree-holder” while the person against whom a decree has been passed or an
order capable of execution has been made is known as a “judgment-debtor”.
The proceedings to execute a decree must be initiated, in the first instance, before the court
which passed it. Where appropriate, such court may transfer the decree to another court for Page
7 of 7 executions for various reasons including the locus of the judgment debtor or the locus of
the property against which the decree is sought to be executed.

LIMITATION PERIOD
As per the Limitation Act 1963, the period of limitation for the execution of a decree (other than
a decree granting a mandatory injunction, in which case, it is three years) is twelve years from
the date of the decree. However, an application for execution of a decree granting a perpetual

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injunction shall not be subject to any period of limitation.

SUGGESTIONS & CONCLUSION

1.Clarification of Grounds for Non-Enforcement: There could be a need for clearer and more
uniform standards regarding the grounds for non-enforcement of foreign awards. This could help
reduce ambiguity and ensure consistency in enforcement decisions across different jurisdictions.
2. Streamlining Enforcement Procedures: Simplifying and streamlining the enforcement
procedures could make the process more efficient and cost-effective for parties seeking
enforcement of foreign awards. This might involve reducing unnecessary paperwork,
standardizing forms and documentation requirements, and promoting electronic filing and
communication.
3. Enhanced International Cooperation: Encouraging greater international cooperation and
coordination among countries could facilitate the enforcement of foreign awards. This could
include measures such as promoting information sharing, mutual assistance in enforcement
proceedings, and collaboration on capacity-building initiatives.
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4. Addressing Jurisdictional Issues: Clarifying jurisdictional issues that arise in the enforcement
of foreign awards could help reduce delays and legal disputes. This might involve establishing
clearer rules for determining the jurisdiction of courts or arbitration tribunals in enforcement
proceedings, particularly in cases involving multiple jurisdictions.
5. Recognition of Third-Party Funding: Recognizing and regulating third-party funding
arrangements for enforcement proceedings could help parties access the financial resources
needed to pursue enforcement actions effectively. Clear guidelines and safeguards could help
mitigate potential conflicts of interest and ensure transparency in the funding process.
6. Harmonization of Legal Standards: Promoting greater harmonization of legal standards and
practices related to the enforcement of foreign awards could enhance predictability and
confidence in the enforcement process. This could involve efforts to align national laws and
procedures with international conventions and best practices.
Overall, addressing these recommendations and implementing necessary amendments could
contribute to a more efficient, predictable, and accessible framework for the enforcement of
foreign awards, thereby promoting international trade and investment and fostering confidence in
the rule of law.
The enforcement of foreign awards is a critical aspect of international dispute resolution,
enabling parties to effectively enforce their rights and obligations across borders. Whether it
involves court judgments or arbitral awards, the enforcement process is governed by a
combination of international conventions, bilateral or multilateral treaties, and domestic laws.

Despite the existence of legal frameworks facilitating enforcement, the process can be complex
and challenging due to differences in legal systems, procedural requirements, and potential
challenges raised by the opposing party. However, with careful planning, adherence to legal
requirements, and strategic considerations, parties can navigate the enforcement process
successfully.

Key considerations in the enforcement of foreign awards include understanding the legal basis
for enforcement, complying with procedural requirements, addressing potential challenges or
objections, and utilizing available enforcement measures effectively. Additionally, parties should
be mindful of issues such as sovereign immunity, cross-border cooperation, costs, and
timeframes associated with enforcement proceedings.

Overall, the enforcement of foreign awards plays a crucial role in promoting international trade
and investment by providing parties with a reliable mechanism for resolving disputes and
enforcing their rights in a globalized economy. By seeking legal advice and assistance and
engaging in proactive enforcement strategies, parties can maximize their chances of achieving
successful enforcement outcomes across jurisdictions.

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 BIBLIGRAPHY

Websites:
 https://www.mondaq.com

 https://udrc.lkouniv.ac.in

 https://www.indiacode.nic.in

 https://lawbhoomi.com

 https://blog.ipleaders.in

Book:
 Arbitration and Conciliation Act,1996 – Bare Act

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