Part One of this three-part series on developments in international commercial arbitration ("ICA") in India over the past three years (which can be accessed here) covered important aspects of ICA such as the analysis of the amendment to the Arbitration and Conciliation Act, 1996 ("Act") enacted in 2019 ("2019 Amendment"), analysis of conflicting judgments on the applicability of Section 9 of the Act to foreign seated arbitrations and the interpretation of arbitration agreements in reference to implicit / explicit exclusion of the applicability of Part I of the Act.

Part Two of the Series (which can be accessed here) delved into the complex questions of the interpretation of the terms 'seat', 'venue' and 'place' of arbitration raised by recent judgments of the Supreme Court ("SC") in cases such as Hardy Exploration1 and BGS SGS.2

This present and final part of the three-part series delves into the aspects regarding the enforcement of foreign awards in India, in recent times. From an enforceability / challenge perspective, the law relating to ICA awards and foreign awards has seen significant developments. For example: (i) there has been more consistency regarding interpretation of 'public policy' as a ground for challenge of an ICA seated in India (under Section 34) and a bar against enforcement of a foreign award (under Section 48); (ii) the provisions of the Act regarding the enforcement of foreign awards have taken precedence over general legislations; (iii) the principle of minimal judicial intervention in the enforcement of foreign awards has been further extolled; (iv) the definition of 'court' in the explanation of Section 47 has been variedly interpreted and (v) there appears to be further ambiguity regarding the limitation period applicable to the enforcement of foreign awards.

  1. Narrow construction of 'Public Policy'

The enforceability of foreign awards in India, which is an important parameter for determining how arbitration-friendly a jurisdiction is, has improved significantly after the changes brought about in the 2015 Amendment3 and the Delhi High Court's simpatico holding in Cruz City,4 i.e., that "contravention of any provision of an enactment is not synonymous to contravention of fundamental policy of Indian law...The expression "fundamental policy" (only) connotes the basic and substratal rationale, values and principles which form the bedrock of laws in our country."

The case of Ssangyong Engg.,5 while dealing with a domestic award, set out succinctly what the contours of the challenge of an award on the ground of "violation of public policy" were, either under Section 34(b)(ii) (for domestic awards, or ICA awards seated in India) or Section 48(2)(b) (for foreign awards). It maintained that the test propounded by Renusagar6 would continue to guide courts while deciding a challenge to an award. The threshold to challenge an award as being contrary to public policy has been raised. For the public policy ground to kick in, the arbitral award under scrutiny must "shock the conscience of the court" and defy the most "fundamental notions of justice and morality".7 It also stated that apropos the 2015 Amendment, the ground of "patent illegality" was no longer available for the challenge of ICA awards. The ratio of Ssangyong Engg., in so far as it applied to ICAs, was cited and relied on in the judgments of multiple lower courts, to allow the enforcement of foreign awards.8

However, in the very recent judgment in Alimenta,9 the SC refused to enforce a foreign award which required parties to pay damages under a contract despite the fact that the contract contemplated performance of obligations which could not have been performed without the express permission of the government of India (export of groundnuts). The appellant in Alimenta was a nodal agency of the government that dealt with export of nuts and similar food items and it was denied the Government's permission to fulfil its contractual obligations to the respondent, a foreign entity. The SC was of the opinion that such a foreign award was in violation of public policy because it did not consider that the performance of the underlying contract was impossible in the absence of governmental permission. According to the SC in Alimenta, such an interpretation of the term "public policy" was still in compliance with the narrow construction of the term as per the diktat of the SC in n Renusagar and Ssangyong Engg. It is pertinent to note that in the process of coming to this conclusion, the SC conducted an in-depth analysis of the facts of the case, despite the underlying fact that questions of enforceability should refrain from re-litigating the merits of a case.

  1. The Arbitration Act is to be Construed as a Special Legislation

With respect to foreign awards, some progress has been made in the courts' interpretation of the provisions of Section 47-50 of the Act and their general precedence over contrary provisions in other acts. For example, in keeping with the general assumption that the Act will supersede any general act, the SC in Kandla Export10 held that Section 50(2) of the Act, which disallows an appeal against a judgment of a court under Section 50(1), takes precedence over Section 13(1) of the Commercial Courts Act,11 which provides for an appeal against orders passed by the Commercial Division of a High Court. The reasoning herein was that of the SC in Fuerst Day Lawson,12 which stated that the Act was a self-contained code on arbitration and that any type of order / decree which is not specifically covered under Section 50 of the Act, was not further appealable under any other general legislation (such as the Commercial Courts Act which provides for a Letters Patent appeal).

Taking the reasoning in Kandla Exports further, the Delhi High Court in Precious Sapphires13 lent some clarity on the import of the term "Court" in Section 47 of the Act.14 The definition of "Court", in the context of Section 47 of the Act, was amended vide the 2015 Amendment to mean a High Court in particular and not just the principle civil court with original jurisdiction. In Precious Sapphires, the subject petition had been filed in the Delhi High Court prior to the 2015 Amendment, for the enforcement of a foreign award passed by the London Maritime Arbitrators' Association. Subsequently, the Delhi High Court (Amendment) Act, 2015 altered the pecuniary jurisdiction of the Delhi High Court, and accordingly, the said petition was below the pecuniary jurisdiction now fixed for the Delhi High Court. However, soon thereafter, the 2015 (Arbitration) Amendment was enacted and accordingly, vide Section 47, the court for the enforcement of a foreign award became the concerned High Court. The Delhi High Court finally held that, as per the ratio of Kandla Exports, the 2015 Amendment will take precedence and apply retrospectively in this regard.Accordingly, the Delhi High Court retained jurisdiction and the foreign award was enforced.

  • Definition of 'Court' under Section 47

However, the import of the term "Court" in Section 47 of the Act still remains a source of some controversy, if compared to the definition of the term in Section 2(1)(e)(ii) of the Act.15 The subtle difference therein lies in what are the questions the 'Court' is allowed to go into. Section 2(1)(e)(ii) deals with a court having jurisdiction to hear questions forming the subject matter of the arbitration, while the explanation to Section 47 deals with the court which has the jurisdiction to hear questions forming the subject matter of the arbitral award. The Bombay High Court in Trammo DMCC16 had the occasion to interpret this difference, with respect to the question of the court where a Section 9 application would lie, if it was being filed in a foreign-seated arbitration, as allowed vide the 2015 Amendment. The court held that in such a situation, it must be filed in the court referred to in Section 47 and not in Section 2(1)(e)(ii), because the latter definition does not apply to Part II of the Act. The definition in Section 47 applies specifically to foreign awards and accordingly, such Section 9 applications, given that they are usually 'in aid' of enforcement of arbitral awards, should be filed in the court which has the jurisdiction to hear questions forming the subject matter of the arbitral award, as opposed to that of the arbitration. In this particular case, the application was filed in the jurisdiction where the bank account of the award debtor (which was the subject of the requisite interim relief) was located.

  1. Minimal Judicial Interference in the Enforcement of Foreign Awards

In keeping with Indian courts' pro-arbitration approach, courts have also generally looked upon the enforcement of foreign awards favourably. In the recent case before the SC in Vijay Karia,17 the respondent's primary arguments for seeking the interference of the court in the enforcement of the foreign award were that: (i) the respondent was "otherwise not able to present his case" (the language of Section 48(1)(b) of the Act) because the award did not make a finding on a material issue; and (ii) the award was contrary to a provision of the Foreign Exchange Management Act, 1995 ("FEMA") and the rules enacted thereunder. The SC, while enforcing this foreign award, stated that, inter alia, the following need to be kept in mind while enforcing foreign awards: (i) the valid existence of a pro-enforcement bias towards foreign awards, as espoused in the New York Convention;18 (ii) the ground of a "(party being) otherwise unable to present his case" must involve an egregious violation of the principles of natural justice (and not just poor reasoning regarding a material finding in the award); (iv) the narrow construction of the term "public policy";19 and (v) minimal interference. As such, the SC held that a purported violation of FEMA would not amount to a ground for interference with the execution of the foreign award, because it does not deal with the "core values of the public policy of the nation", which is similar to the holding in Cruz City and NTT Docomo.20

The Delhi High Court relied on the holding of the SC in Vijay Karia in the recent prolific Cairn India case wherein the Court allowed the enforcement of a foreign award and held that "public policy" must be construed narrowly, and that enforcement proceedings do not involve a second look into the merits of case.21 Similarly, in a recent judgment of the Banyan Tree,22 the Bombay High Court in ruled in favour of the enforcement of foreign award despite contentions that it had violated the Securities Contract (Regulation) Act, 1956 ("SCRA") and FEMA. The Court while reaching a conclusion in relation to the FEMA contention, relied on the finding in Vijay Karia, i.e., that FEMA violations did not render contracts unenforceable and accordingly, such a violation did not go against "core Indian legal policy". Banyan Tree touched upon two other important points: (i) the court ruled in favour of the enforcement of an award that specifically held that a 'put option' clause was valid under the SCRA; and (ii) the enforcement of a foreign award cannot be denied on the ground that the arbitration agreement is not adequately stamped. The Bombay High Court distinguished the facts of the present case from the holdings in SMS Tea Estates23 and Garware Wall Ropes24 and held that cases involving a domestic arbitration, like a Section 11 petition, may be rendered inadmissible because of the inadequate stamping of the arbitration agreement, but the same logic does not apply to the enforcement of foreign awards, because that would in fact involve an examination of factual disputes.

Along these lines, there have been various notable recent judgments which have simplified the process of enforcement of foreign awards and have diluted the technical objections to facilitate the larger goal of enforcing the foreign awards. For example, the SC in PEC v. Austbulk Shipping25 held that the requirement for production of an original / authenticated copy of the subject arbitration agreement for enforcement of a foreign award was merely a directory requirement, despite the provision referring to it as a "shall" obligation. Similarly, in a decision that settled significant controversy in lower courts, and aided in bolstering India's arbitration-friendly image, the SC in Shriram EPC26 declared that stamp duty need not be paid on a foreign award, because the same was not specifically included in the provisions of the Indian Stamp Act, 1899, which were applicable only within the territory of India. In Devi Resources,27 the Calcutta High Court declared that an interim anti-arbitration injunction, which had later been vacated, cannot be a ground to deny enforcement of a foreign award. Further, as per the Delhi High Court in SBS Logistics,28 the enforcement of a foreign award, despite the parties' failure to comply with pre-arbitral steps, was not a violation of the principles of natural justice. In LMJ29 the SC upheld the enforcement of a foreign award by the Calcutta High Court, stating that Section 48 of the Act does not countenance a "second-look" into the merits of a foreign award by the executing court, and in the event there was an error committed by the arbitral tribunal, the same could only be corrected by an appeal against the foreign award in the court of the seat of the arbitration. In Glencore v. Indian Potash,30 the Delhi High Court agreed to enforce a foreign award passed by the SIAC, despite : (i) the arbitration agreement providing for arbitration administered under "Rules of Singapore International Arbitration of the Chambers of Commerce in Singapore", a non-existent entity (because enforcement could not be denied for a technical non-compliance, which could reasonably be interpreted to mean "SIAC"); (ii) the SIAC allowing the award holder to amend pleadings at the stage of final arguments (because the same does not amount to a violation of the principles of natural justice); and (iii) stamp duty not being paid on the foreign award (as per the SC's holding in Shriram EPC).

Another landmark judgment which held in favour of the enforcement of a foreign award was in the very recent case of Centrotrade.31 A three-judge bench of the SC stated that a court cannot deny enforcement of a foreign award under Section 48 merely because the respondent contended that it was not given the opportunity to present its case as the documents submitted by the Respondent were not considered by the Arbitral Tribunal. The Respondent also cited the stay order, which was in nature of an anti-arbitration injunction, granted by the Rajasthan High Court. On the facts of the case, the SC held that the Respondent had (i) not submitted various necessary documents to the tribunal within the stipulated timelines, despite multiple extensions being allowed by the tribunal, and (ii) chosen to submit these documents only after the closure of the timeline thereof after the multiple extensions provided. The Court held that these actions would constitute a failure attributable to the respondent, and not the denial of "an adequate opportunity to present its case", i.e., a violation of the principles of natural justice, as required under Section 48(1)(b) for a challenge to enforcement of a foreign award. To reach this conclusion, the SC in Centrotrade relied on Vijay Karia, as well as Sohan Lal Gupta,32 and Hari Om Maheshwari.33 On the stay Order granted by Rajasthan High Court, the SC, very interestingly observed that the same did not bind the arbitrator but only restricted the parties.

  1. Limitation Period for the Enforcement of Foreign Awards

Three years ago, the Indian judiciary's position on the limitation period applicable to the enforcement of foreign awards was slightly murky. To begin with, the ratio of Fuesrt Day Lawson broadly holds that a foreign award should be treated as a decree of the court for the purposes of execution and enforcement, so that time is not lost in litigation determining its status as a decree. Thereafter, to recap, (i) a Single-Judge bench of the Madras High Court in Bharat Refineries34 declared that the limitation period in Article 136 of the Limitation Act, 1963 ("Limitation Act"), i.e., 12 years, will be applicable to the enforcement of a foreign award, because it is deemed to be a decree of the court; (ii) however, a Single-Judge bench of the Bombay High Court in Noy Vallesina,35 in a ruling slightly contrary to the ratio of Fuerst Day Lawson, made the differentiation between proceedings for the execution of a foreign award under Section 47 and its enforcement under Section 49. Accordingly, the Bombay High Court held that execution proceedings under Section 47 are governed by Article 137 of the Limitation Act, i.e., 3 years (residuary provision), because at that stage, the foreign award has not yet attained the status of a decree and enforcement petitions are governed by Article 136 of the Limitation Act, because at this stage, the foreign award has attained the status of a decree.

Post-2017, there have been more developments in this regard. A different Single-judge Bench of the Bombay High Court, in the 2019 order of Imax v. E-City,36 relying on Fuerst Day Lawson and Shriram EPC, held that execution and enforcement proceedings may occur together for a foreign award and accordingly, the 12-year limitation period under Article 136 of the Limitation Act would be applicable to a foreign award's execution / enforcement. Thereafter, in the recent pronouncement of the Delhi High Court in Cairn India37 in February 2020, after an appreciation of the ratio of Fuerst Day Lawson and the contradictory judgments of the Bombay High Court's Single-Judge benches and the Madras High Court, the court drew the conclusion that Article 136 of the Limitation Act, i.e., 12 years, is the correct limitation period, because a foreign award is already a decree before the initiation of any execution / enforcement proceedings.

However, in a March 2020 judgment unrelated to foreign arbitral awards, but pertaining to a decree passed by a foreign court, a division bench of the SC in Bank of Baroda v. Kotak Mahindra38 declared that Article 136 of the Limitation Act can only apply to enforcement of decrees passed by Indian courts. The rationale for the same was largely that whenever the Limitation Act contemplated limitation periods for causes that pertain to foreign territories, they provide for the same, and they had not done so for foreign decrees. Therefore, it held the following: (a) that the limitation period for the enforcement of a foreign decree will be the limitation period applicable as per the laws of the 'cause country', i.e., the country pronouncing the decree; (b) in the event the laws of 'cause country' are silent, Article 137 of the Limitation Act will apply, which is 3 years; and in the event the 'Cause Country' has executed the decree, but it has not been fully satisfied, the decree holder may apply for complete satisfaction in India within 3 years of the finalisation of the execution proceedings in the 'Cause country'.

The logical assumption, if we were to apply Bank of Baroda v Kotak Mahindra is that a foreign award, is effectively a foreign decree, and accordingly, proceedings for its execution and enforcement must commence as per the limitation laws of the jurisdiction of the seat, and in the event of silence thereof, within 3 years of it being passed (or being partly satisfied in the foreign jurisdiction). However, it remains to be seen whether the SC or any high court will differ from the holding in Bank of Baroda v Kotak Mahindra, or distinguish the same from the situation involved in the enforcement / execution of a foreign award in light of Fuerst Day Lawson or the general pro-arbitration attitude being taken by the legislature and judiciary.


We seem to have a fair bit of clarity on two things, in light of Ssangyong Engg. and Vijay Karia:

  1. The courts are strictly interpreting "public policy" as a ground for denial of enforcement of an award. Interference with the enforcement of foreign awards is only in exceptional cases.
  1. Courts are heavily discouraged from importing "patent illegality" as a ground for challenging an ICA award, in light of the 2015 Amendment and judgments elucidating the same.

However, the new grey areas that seemed to have emerged with respect to the enforceability of foreign awards are as follows:

  1. While Ssangyong, Vijay Karia, seem to reiterate the need to narrowly construe "public policy' in a foreign award context, judgments like Alimenta, while cohesive in their final finding, seem to allow the court to get into an in-depth examination of the underlying contract, merits of the case, etc. To some extent, we are right back where we started and it appears that the courts will just interpret the term on a case to case basis, without any objective guidance or parameters.
  1. Bank of Baroda v. Kotak Mahindra seems to hold that the limitation period for the execution of a foreign decree in India is as per the limitation laws of the foreign country passing the decree / 3 years in the event the foreign law is silent. This is contrary to the dominant line of judgments of various High Courts and Fuerst Day Lawson regarding enforcement of foreign awards, i.e., foreign awards are tantamount to decrees, and therefore the limitation period for their execution / enforcement proceedings is 12 years. It is yet to be seen how this latest dissonance will be dealt with by the judiciary.

The aforementioned, as well as all the ambiguities we analysed in the previous parts of this series, clarify that ICA has come a long way, however, the amendments and the dynamic nature of ICAs will continue to raise interesting questions for years to come. Additionally, 2020 seems set to pose immense challenges in ICA, especially with the advent of the COVID-19 pandemic and all the chaos and overhaul that it entails, in terms of online dispute resolution, force majeure invocations, etc. In light of these ever-increasing grey areas in ICA, it seems like the laws pertaining to arbitration in India will continue to be a hot topic amongst legal circles.


1 Union of India v. Hardy Exploration & Production (India) Inc., AIR 2018 SC 4871 (SC, 2018).

2 BGS SGS SOMA JV v. NHPC Ltd., 2019 (6) ArbLR 393 (SC, 2019).

3 The 2015 Amendment inserted Sub Section 2A to Section 34 of the principal Act, which included "patent illegality" as a ground for the setting aside of an arbitral award in a domestic arbitration, but not an ICA.

4 Cruz City 1 Mauritius Holdings v. Unitech Ltd., 2017 (3) ArbLR 20 (Delhi) (Delhi High Court, 2017).

5 Ssangyong Engineering & Construction Co. Ltd. v. National Highways Authority of India, AIR 2019 SC 5041 (SC, 2019).

6 Renusagar Power Co. Ltd. v. General Electric Co. AIR 1994 SC 860 (SC, 1994).

7 Placing reliance on paragraphs 18 and 27 of Associate Builders v. Delhi Development Authority, (2015) 3 SCC 49 (SC, 2015).

8 Indian Oil Corporation Ltd. v. Neptuno Maritime Corp., O.M.P. (COMM) 220/2018 (Delhi High Court, 2019); Mecamidi S.A. v. Flovel MG Holdings Private Limited & Ors., 2019 (5) ArbLR 505 (Delhi) (Delhi High Court, 2019); G + H Schallschutz GMBH vs. Bharat Heavy Electricals Ltd., 2020 IIAD (Delhi) 205 (Delhi High Court, 2020).

9 National Agricultural Co-Operative Marketing Federation of India v. Alimenta S.A., Civil Appeal No. 667 of 2012 (SC, 2020).

10 Kandla Export Corporation & Anr. v. M/s. OCI Corporation & Anr., (2018) 14 SCC 715 (SC, 2018).

11 Commercial Courts, Commercial Division and Commercial Appellate Division of High Court Act, 2015.

12 Fuerst Day Lawson Ltd. v. Jindal Exports Ltd., (2011) 8 SCC 333 (SC, 2011).

13 Precious Sapphires Ltd. v. Amira Pure Foods Pvt. Ltd., Ex. P. 330/2015 (Delhi High Court, 2018).

14 Section 47: Evidence -

"(1) The party applying for the enforcement of a foreign award shall, at the time of the application, produce before the court—

(a) the original award or a copy thereof, duly authenticated in the manner required by the law of the country in which it was made;

(b) the original agreement for arbitration or a duly certified copy thereof; and

(c) such evidence as may be necessary to prove that the award is a foreign award.

(2) If the award or agreement to be produced under sub-section (1) is in a foreign language, the party seeking to enforce the award shall produce a translation into English certified as correct by a diplomatic or consular agent of the country to which that party belongs or certified as correct in such other manner as may be sufficient according to the law in force in India.

Explanation—In this section and in the sections following in this Chapter, "Court" means the High Court having original jurisdiction to decide the questions forming the subject-matter of the arbitral award if the same had been the subject-matter of a suit on its original civil jurisdiction and in other cases, in the High Court having jurisdiction to hear appeals from decrees of courts subordinate to such High Court."

15 Section 2: Definitions:

"(1) In this Part, unless the context otherwise requires:

(e) "Court" means –


(ii) in the case of international commercial arbitration, 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, and in other cases, a High Court having jurisdiction to hear appeals from decrees of courts subordinate to that High Court."

16 Trammo DMCC v. Nagarjuna Fertilizers & Chemicals Ltd., 2018 (1) ABR 1 (Bombay High Court, 2017).

17 Vijay Karia & Ors. v. Prysmian Cavi E Sistemi SRL & Ors., Civil Appeal No. 1544 of 2020 (Arising out of SLP (Civil) No. 8304 of 2019) (SC, 2020).

18 The United Nations Commission on International Trade Law, Convention on the Recognition and Enforcement of Foreign Awards, 1958.

19 Reiterating Ssangyong Engg. v. NHAI's reliance on Renusagar and Associate Builders.

20 NTT Docomo Inc. v. Tata Sons Ltd., 2017 (4) ArbLR 127 (Delhi) (Delhi High Court, 2019).

21 Cairn India Ltd. & Ors. v. Government of India, O.M.P. (EFA) (COMM.) 15/2016 (Delhi High Court, 2020).

22 Banyan Tree Growth Capital LLC v. Axiom Cordages Ltd. & Ors., Comm. Arb. Petn. No. 476 of 2019 (Bombay High Court, 2020).

23 SMS Tea Estates Pvt. Ltd, v. Chandmari Tea Co. Pvt. Ltd., (2011) 14 SCC 66 (SC, 2011).

24 Garware Wall Ropes Ltd. v. Coastal Marine Constructions & Engineering Ltd., (2019) 9 SCC 209 (SC, 2009).

25 P.E.C. Ltd. v. Austbulk Shipping SDN BHD, (2019) 11 SCC 620 (SC, 2019).

26 M/s Shriram EPC Ltd. v. Rioglass Solar SA, AIR 2018 SC 4539 (SC, 2018).

27 Devi Resources Ltd. v. Ambo Exports Ltd., 2019 (6) ArbLR 32 (Cal) (Calcutta High Court, 2019).

28 SBS Logistics Singapore Pte. Ltd. v. SBS Transpole Logistics Pvt. Ltd., 2019 (6) ArbLR 82 (Delhi, 2019).

29 LMJ International Ltd. & Ors. v. Sleepwell Industries Co. Ltd., Special Leave Petition (Civil) No. 540 of 2018 (SC, 2019).

30 International AG v. Indian Potash Limited & Anr., Execution Petition No. 99 of 2015 (Delhi High Court, 2019).

31 M/s. Centrotrade Minerals and Metals, Inc. v. Hindustan Copper Ltd., Civil Appeal No. 2562 of 2006 (SC, 2020).

32 Sohan Lal Gupta v. Asha Devi Gupta, (2003) 7 SCC 492 (SC, 2003).

33 Hari Om Maheshwari v. Vinitkumar Parikh, (2005) 1 SCC 379 (SC, 2005).

34 Compania Naviera 'SODNOC' v. Bharat Refineries Ltd. & Ors., AIR 2007 Mad 251 (Madras High Court, 2007).

35 Noy Vallesina Engineering Spa v. Jindal Drugs Ltd., 2006 (3) ArbLR 510 (Bom) (Bombay High Court, 2006).

36 Imax Corporation vs. E-City Entertainment (I) Pvt. Ltd. and Ors., 2020 (1) ABR 82 (Bombay High Court, 2019)

37 Cairn India Ltd. & Ors. v. Government of India, O.M.P. (EFA) (COMM.) 15/2016 (Delhi High Court, 2020).

38 Bank of Baroda v. Kotak Mahindra Bank Ltd., Civil Appeal No. 2175 of 2020 (SC, 2020).

Originally published 08 July, 2020

The content of this document do not necessarily reflect the views/position of Khaitan & Co but remain solely those of the author(s). For any further queries or follow up please contact Khaitan & Co at