There has been a lot of discussion recently on the impact of the
judgment of the Supreme Court of India in the case of Venture
Global Engineering Vs. Satyam Computer Services Ltd. and Another
delivered in January 2008 ("Satyam Case"). The legal
community outside India have expressed surprise and concern that
the courts in India are trying to usurp jurisdiction in respect of
a challenge to an award even in cases of international commercial
arbitration. The general view being formed is that even a foreign
award is now not sacrosanct and carries the risk of being set aside
by Indian Courts in exercise of powers under section 34 of the
Arbitration & Conciliation Act, 1996 ("Act"). The
concern appears to be unjustified.
Prior to the decision in the Satyam Case the enforcement of a
foreign award in India could be defended on the grounds provided in
section 48 of the Act. When such grounds are compared to the
grounds for challenge under section 34 it appears the grounds of
defense under section 48 are nearly the same.
Accordingly, the only thing that the Satyam Case achieves is
that it allows the carriage of proceedings to move in favour of the
judgment debtor rather than requiring the judgment debtor to await
enforcement of a foreign award by a judgment creditor and then
oppose such enforcement on similar grounds available to the
judgment debtor to launch a challenge to such award and preempt
enforcement proceedings. Further, the Supreme Court has also held
that the applicability of section 34 can be negated to a foreign
award by express agreement in these regards by the parties to the
agreement. In view of the above one cannot understand the deep
concern being expressed by the legal community in respect of the
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