Challenging and Enforcing Arbitration Awards

Last verified on Thursday 27th May 2021

Challenging and Enforcing Arbitration Awards: India

Sanjeev Kapoor and Saman Ahsan

Khaitan & Co

Applicable requirements as to the form of arbitral awards

1. Must an award take any particular form?

India

Section 31 of the Arbitration and Conciliation Act 1996 (the Arbitration Act) provides, inter alia, that an arbitral award shall be made in writing and be signed by the members of the arbitral tribunal. In this respect, Section 31(2) clarifies that in arbitral proceedings with more than one arbitrator, the signatures of the majority of the members of the arbitral tribunal shall be sufficient provided the reason for any omitted signature is stated. After the award is made, a signed copy is required to be delivered to each party.

Section 31 also provides that the arbitral award shall state the reasons on which it is based unless the parties have agreed that no reasons are to be given, or the award is an arbitral award on agreed terms under Section 30 (Settlement).

Additionally, the award is required to state the date and place of arbitration as determined in accordance with Section 20 (Place of Arbitration) and the award shall be deemed to have been made at that place.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

Applicable procedural law for recourse against an award

2. Are there provisions governing modification, clarification or correction of an award? Are there provisions governing retractation or revision of an award? Under what circumstances may an award be retracted or revised (for fraud or other reasons)?

India

Section 33 of the Arbitration Act provides that a party, with notice to the other party, may within 30 days of receipt of the arbitral award (unless another time limit has been agreed by the parties) request the arbitral tribunal to correct any computation errors, any clerical or typographical errors, or any other errors of a similar nature occurring in the award. Additionally, if so agreed by the parties, a party, with notice to the other party, may request the arbitral tribunal to give an interpretation of a specific point or part of the award.

If the arbitral tribunal considers the request made by a party to be justified, then it is required to make the correction or give the interpretation within 30 days of receipt of the request and any such interpretation shall form part of the arbitral award. The arbitral tribunal may also correct any errors of the types referred to above on its own initiative within 30 days of the date of the award.

Section 33 also provides that a party may request the arbitral tribunal, with notice to the other party and within 30 days of receipt of the award, to make an additional award as to claims presented in the arbitral proceedings but omitted from the arbitral award, unless otherwise agreed by the parties. The arbitral tribunal is then required to make the additional arbitral award within 60 days of receipt of the request, if it considers the request to be justified.

If necessary, the arbitral tribunal may also extend the time limit within which it shall make a correction, give an interpretation or make an additional award. The provisions of Section 31 (Form and contents of arbitral award) shall apply to a correction or interpretation of the arbitral award or to an additional award made under Section 33.

Although an award may be corrected on the grounds mentioned above (Section 33), the retractation of an award on any matter of substance is not permissible by the arbitral tribunal since the arbitral tribunal becomes functus officio after rendering the award. A party may move the courts to have the award set aside under Section 34 (domestic award) or Section 48 (foreign award) of the Arbitration Act if the making of the award was induced by fraud, corruption or under other grounds set out in these Sections.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

3. May an award be appealed to or set aside by the courts? What are the differences between appeals and applications to set aside awards?

India

A domestic award may be set aside by the court under Section 34(2) of the Arbitration Act if the the arbitral records can establish that:

  • the party was under some incapacity;
  • the arbitration agreement is not valid under the law chosen by the parties or, in its absence not valid under the law in force at the relevant time;
  • the applicant was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings, or was otherwise unable to present his or her case;
  • the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matter beyond the scope of the submission to arbitration; or
  • the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, or failing any such agreement, was not in accordance with Part I of the Arbitration Act.

An arbitral award may also be set aside if the court finds that (1) the subject matter of the dispute is not capable of settlement by arbitration under the law for the time being in force or (2) the arbitral award is in conflict with the public policy of India.

In addition to the above, an arbitral award arising out of arbitrations other than international commercial arbitrations may be set aside by the court, if the court finds that the award is vitiated by patent illegality appearing on the face of the award.

An appeal may lie under Section 37 of the Arbitration Act from an order setting aside or refusing to set aside an arbitral award under Section 34. Significantly, no second appeal lies from an order passed in appeal under Section 37; however, nothing prevents a party from approaching the Supreme Court by way of a Special Leave Petition under Article 136 of the Constitution of India.

As for the difference between appeals and applications for set-aside, the first recourse available to a party against a domestic arbitral award would be to file an application for setting aside the award under Section 34 of the Arbitration Act. Thereafter, and as a second recourse, an appeal may lie under Section 37 of the Act from an order setting aside or refusing to set aside an arbitral award under Section 34.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

Applicable procedural law for setting aside of arbitral awards

4. Is there a time limit for applying for the setting aside of an arbitral award?

India

Insofar as a domestic award is concerned, Section 34(3) of the Arbitration Act provides that an application for setting aside an arbitral award has to be made within three months of the date of receipt of the arbitral award by the applicant or of the date on which a request for correction or interpretation of the award under Section 33 of the Act has been disposed by the tribunal, if such requests have been made. However, if the court is satisfied that the applicant was prevented by sufficient cause from making the application within the given period of three months, it may entertain the application within a further period of 30 days but not thereafter.

Insofar as a foreign award is concerned, an award debtor can only file its objections under Section 48 of the Arbitration Act once the award holder files for enforcement of the award (Arbitration Act, Section 47 read with Section 49). Although the Act does not provide a timeline within which such objections are to be filed by the award debtor, the courts typically grant between two and four weeks to file such objections (subject to further extensions granted by the court).

Answer contributed by Sanjeev Kapoor and Saman Ahsan

5. What kind of arbitral decision can be set aside in your jurisdiction? Can courts set aside partial or interim awards?

India

Under Section 34(2) of the Arbitration Act, an arbitral award rendered in India may be set aside if the applicant furnishes proof that:

  • the party was under some incapacity;
  • the arbitration agreement is not valid under the law chosen by the parties or, absent any such choice, the law in force at the relevant time;
  • the applicant was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his or her case;
  • the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration; or
  • the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties or, absent any such agreement, was not in accordance with Part I of the Arbitration Act.

Additionally, a court can set aside an award if it finds that the subject matter of the dispute is not capable of settlement by arbitration under the law for the time being in force or the arbitral award is in conflict with the public policy of India. The Arbitration Act clarifies that an award is in conflict with the public policy of India, only if, inter alia, (1) the making of the award was induced or affected by fraud or corruption, or (2) it is in contravention of the fundamental policy of Indian law, or (3) it is in conflict with the most basic notions of morality or justice. Section 34(2) clarifies that the test as to whether there is a contravention with the fundamental policy of Indian law shall not entail a review on the merits of the dispute.

In terms of Section 34(2A) of the Arbitration Act, if an award made in India does not emanate from an international commercial arbitration in which one of the parties is not an Indian, then it can also be set aside on the ground that it is vitiated by patent illegality appearing on the face of the award, although an award is not to be set aside merely on the ground of an erroneous application of the law or by reassessment of the evidence.

Insofar as foreign-seated awards are concerned, a court may refuse their enforcement under the terms of Section 48 of the Arbitration Act, at the request of the party against whom it is invoked, only if that party furnishes to the court proof that:

  • the parties to the agreement were, under the law applicable to them, under some incapacity, or the said agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law of the country where the award was made;
  • 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 or her case;
  • the award deals with a difference not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration (although Section 48 clarifies that if the decisions on matters submitted to arbitration can be separated from those not so submitted, that part of the award which contains decisions on matters submitted to arbitration may be enforced);
  • the composition of the arbitral authority or the arbitral procedure was not in accordance with the agreement of the parties or, absent any such agreement, was not in accordance with the law of the country where the arbitration took place; or
  • the award has not yet become binding on the parties, 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.

Furthermore, the enforcement of a foreign-seated arbitral award may also be refused if the court finds that (1) the subject matter of the dispute is not capable of settlement by arbitration under the law of India, or (2) enforcement of the award would be contrary to the public policy of India. Similarly to Section 34, Section 48 of the Arbitration Act clarifies that an award is in conflict with the public policy of India only if, inter alia, (1) the making of the award was induced or affected by fraud or corruption, or (2) it is in contravention with the fundamental policy of Indian law, or (3) it is in conflict with the most basic notions of morality or justice. Section 48 further clarifies that the test as to whether there is a contravention with the fundamental policy of Indian law shall not entail a review on the merits of the dispute.

Finally, the courts have discretion to adjourn their decision on enforcement if an application for the setting aside or suspension of an award has been made to a competent authority and may also, on the application of the party claiming enforcement of the award, order the other party to give suitable security.

An interim award under the Arbitration Act is a final award as to certain claims between the parties, which is made at an interim stage in the arbitration proceeding. This type of interim award falls within the meaning of ‘award’ under Section 2(1)(c) of the Act and can be set aside under Section 34 (domestic award) or Section 48 of the Act (foreign awards).

Answer contributed by Sanjeev Kapoor and Saman Ahsan

6. Which court has jurisdiction over an application for the setting aside of an arbitral award?

India

Section 2(1)(e)(i) of the Arbitration Act provides that an application for setting aside an arbitral award passed in an arbitration other than an international commercial arbitration will have to be filed either before a district court, being a principal civil court of original jurisdiction, or before the high court exercising ordinary original civil jurisdiction, which has jurisdiction to decide the questions forming the subject matter of the arbitration.

Further, if an arbitral award has been passed in international commercial arbitrations, an application for setting aside the award will have to be filed before the high court exercising ordinary civil jurisdiction, having jurisdiction to decide the questions forming the subject matter of the arbitration or, in other cases, having jurisdiction to hear appeals from decrees of courts subordinate to that high court (Arbitration Act, Section 2(1)(e)(ii)).

Additionally, once an application under Part I of the Act has been put before a particular court, all subsequent applications (including an application to set aside an arbitral award under Section 34) will have to be put before the same court (Arbitration Act, Section 42).

Answer contributed by Sanjeev Kapoor and Saman Ahsan

7. What documentation is required when applying for the setting aside of an arbitral award?

India

Although the Arbitration Act does not prescribe the relevant documentation to be furnished by an applicant, an application for setting aside an award is typically accompanied by the original copy of the impugned award (with some courts holding that filing at least a copy of the impugned award is sine qua non to filing the setting-aside application) and the arbitral record (i.e., pleadings, evidence, etc. presented to the tribunal). The high courts have different requirements as regards the number of copies required by the court.

Although, ordinarily, courts in India will not go beyond the award and the record before the arbitrator in deciding the setting-aside application, in Emkay Global Financial Services Limited v. Girdhar Sondhi (2018) 9 SCC 49, the Supreme Court has clarified that documents that do not form part of the arbitral record, but are relevant to the determination of issues, may be brought to the notice of the court by way of affidavits filed by parties.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

8. If the required documentation is drafted in a language other than the official language of your jurisdiction, is it necessary to submit a translation with the application for the setting aside of an arbitral award? If yes, in what form must the translation be?

India

Ordinarily if the arbitral award or arbitral records are in a regional language, they have to be accompanied by an English translation thereof (though this may depend on the rules framed by the particular high court). Translations must ordinarily be carried out by an official translator of the concerned court or by an official translator from an authority or body duly recognised by the concerned court or recognised by central or state governments.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

9. What are the other practical requirements relating to the setting aside of an arbitral award? Are there any limitations on the language and length of the submissions and of the documentation filed by the parties?

India

The procedural and practical requirements relating to setting aside an award varies from one high court to another. However, ordinarily, the original award is filed with an application for setting aside the award (or an exemption application may be moved explaining why the original award could not be placed on record). Further, the arbitral record filed must be true copies (typed or photocopies of the original) and in the event that the annexed records are dim or illegible, true typed copies of those records will also have to be filed before the court. A synopsis of the matter and a list of relevant dates are typically also filed with the setting-aside application for the convenience of the court.

Ordinarily, pleadings are filed in English (although there may be certain jurisdictions where pleadings can be filed in the vernacular language also). Ordinarily, there is no limitation on the length of an application for setting aside an arbitral award.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

10. What are the different steps of the proceedings?

India

Insofar as a domestic award is concerned, Section 34(3) of the Arbitration Act provides that an application for setting aside an arbitral award will have to be filed by the aggrieved party within three months of the date of receipt of the award or the date of disposal of a request for correction of the award under Section 33, if any. The application shall be filed only after serving a prior notice to the other party, accompanied by an affidavit endorsing compliance with the requirement under Section 34(5) of the Act.

On receipt of the application, the applicant will prima facie have to satisfy the court that there exist grounds to set aside the arbitral award. Once satisfied, the court will typically issue a notice in the matter and direct the other party to file its response to the application, and may permit the applicant to file a rejoinder to the response filed by the applicant thereafter, if required. Once pleadings are complete, the court will typically hear oral arguments by the parties to ascertain whether grounds set out in Section 34, Paragraphs (2) and (2A) of the Act are made out, and accordingly either set aside the arbitral award or refuse to do so. Ordinarily, the courts will not reassess the evidence examined by the arbitral tribunal and therefore it is quite rare for courts to cross-examine witnesses in setting-aside proceedings.

An application for setting aside a domestic arbitral award will have to be disposed expeditiously, and in any event, within one year of the date on which the notice referred to in Section 34(5) is served on the other party, as prescribed by Section 34(6) of the Act. However, the Supreme Court in State of Bihar v. Bihar Rajya Bhumi, AIR 2018 SC 3862 has clarified that the requirement under Section 34(6) is a direction and not mandatory.

Insofar as a foreign award is concerned, the award debtor must wait for the award holder to file for enforcement proceedings for execution of the award under Section 47 read with Section 49 of the Act, and then file its objections to the award in terms of the grounds stipulated under Section 48. The steps of the proceedings are similar to those in a domestic award in that the court will first direct that pleadings are completed in the matter, and then hear oral arguments on enforceability of the award.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

11. Do setting-aside proceedings have suspensive effect? May an arbitral award be recognised or enforced pending the setting-aside proceedings in your jurisdiction?

India

Insofar as a domestic award is concerned, setting-aside proceedings do not have an automatic suspensive effect on enforcement of an arbitral award. A separate application seeking a stay on the operation of the award under Section 36(2) of the Act will have to be filed with the setting-aside application, which, if allowed by the court, will result in a stay on the operation of the award. The court may grant a stay subject to certain conditions as it may deem fit (such as the deposit of the awarded amount in court or securing the awarded amount by a bank guarantee if the award involves payment of money) (Arbitration Act, Section 36(3)).

By an Ordinance dated 4 November 2020, an amendment has been introduced to Section 36 of the Act, which provides that when the court seized of an application for setting aside an award is satisfied that a prima facie case has been made out – that either the arbitration agreement or contract that is the basis of the award, or the making of the award was induced or effectuated by fraud or corruption – the court shall unconditionally stay the award pending the disposal of the challenge under Section 34 to the award.

Insofar as foreign awards are concerned, the award can only be executed if the court is satisfied that the award is enforceable (and therefore objections, if any, filed under Section 48 are dismissed) (Arbitration Act, Section 49). However, this would not prevent the courts from asking the award debtor to furnish adequate security to secure the arbitral amount.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

12. What are the grounds on which an arbitral award may be set aside?

India

Under Section 34(2) of the Act, an arbitral award rendered in India may be set aside if the applicant furnishes proof that:

  • the party was under some incapacity;
  • the arbitration agreement is not valid under the law chosen by the parties or, absent such an agreement, not valid under the law in force at the relevant time;
  • the applicant was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his or her case;
  • the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration; or
  • the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, or absent any such agreement, was not in accordance with Part I of the Arbitration Act.

Additionally, a court can set aside an award if it finds that the subject-matter of the dispute is not capable of settlement by arbitration under the law for the time being in force or the arbitral award is in conflict with the public policy of India. The Arbitration Act clarifies that an award is in conflict with the public policy of India only if, inter alia, (1) the making of the award was induced or affected by fraud or corruption, or (2) it is in contravention with the fundamental policy of Indian law, or (3) it is in conflict with the most basic notions of morality or justice. Section 34(2) of the Act clarifies that the test as to whether there is a contravention with the fundamental policy of Indian law shall not entail a review on the merits of the dispute.

Under the terms of Section 34(2A), if an award made in India does not emanate from an international commercial arbitration in which one of the parties is not an Indian, then it can also be set aside on the ground that it is vitiated by patent illegality appearing on the face of the award, although an award is not to be set aside merely on the ground of an erroneous application of the law or by reassessment of evidence.

Insofar as foreign awards are concerned, courts may refuse their enforcement, under the terms of Section 48 of the Arbitration Act, at the request of the party against whom it is invoked, only if that party furnishes to the court proof that:

  • the parties to the agreement were, under the law applicable to them, under some incapacity, or the agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law of the country where the award was made;
  • 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 or her case;
  • the award deals with a difference not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration (although Section 48 clarifies that if the decisions on matters submitted to arbitration can be separated from those not so submitted, that part of the award which contains decisions on matters submitted to arbitration may be enforced);
  • the composition of the arbitration authority or the arbitration procedure was not in accordance with the agreement of the parties, or, absent any such agreement, was not in accordance with the law of the country where the arbitration took place; or
  • the award has not yet become binding on the parties, 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.

Additionally, the enforcement of a foreign arbitral award may also be refused if the court finds that the subject matter of the dispute is not capable of settlement by arbitration under the law of India, or enforcement of the award would be contrary to the public policy of India. Similarly to Section 34, Section 48 of the Arbitration Act clarifies that an award is in conflict with the public policy of India, only if, inter alia, (1) the making of the award was induced or affected by fraud or corruption, or (2) it is in contravention with the fundamental policy of Indian law, or (3) it is in conflict with the most basic notions of morality or justice. Section 48 further clarifies that the test as to whether there is a contravention with the fundamental policy of Indian law shall not entail a review on the merits of the dispute.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

13. What is the effect of the decision on the setting-aside application in your jurisdiction? What challenges are available?

India

Once an award has been set aside by the courts in India, it is no longer enforceable.

The first recourse available to a party against a domestic arbitral award would be to file an application for setting aside under Section 34 of the Arbitration Act. Thereafter, an appeal may lie under Section 37 of the Act from an order to set aside or refusing to set aside an arbitral award under Section 34 of the Act. Significantly, no second appeal lies from an order passed on appeal under Section 37; however, nothing prevents a party from approaching the Supreme Court by way of a Special Leave Petition under Article 136 of the Constitution of India.

A foreign award may be challenged under Section 48 of the Arbitration Act in enforcement proceedings filed by the award holder. Under Section 50 of the Act, an appeal lies against a decision refusing to recognise or enforce a foreign award to the high court concerned. No second appeal lies from an order passed under Section 50 of the Act. However, parties can prefer a Special Leave Petition to the Supreme Court against the order passed under Section 50 of the Act under Article 136 of the Constitution of India.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

14. Will courts take into consideration decisions rendered in the same matter in other jurisdictions or give effect to them?

India

The fact that an award may have been set aside or suspended by the competent authority of the country in which, or under the law of which, the award was made may be considered by the court as a ground to refuse enforcement of the foreign seated award.

Nevertheless, recent Indian court decisions have held that the enforcement court does not sit in appeal over the findings of the seat court. Furthermore, in view of the principles of comity of nations, the enforcement court would not comment on the judgments passed by courts in other jurisdictions and that the enforcement of the award is a subsequent and distinct proceeding from the setting-aside proceedings at the seat. Thus, the enforcement court would independently determine the issue of recognition and enforceability of the foreign award and the mere fact that the seat court has upheld the award would not mean that the enforcement court was bound to do the same (which would decide the issue based on the grounds set out in Section 48 of the Act).

Answer contributed by Sanjeev Kapoor and Saman Ahsan

Applicable procedural law for recognition and enforcement of arbitral awards

15. What is the applicable procedural law for recognition and enforcement of an arbitral award in your jurisdiction? Is your jurisdiction party to treaties facilitating recognition and enforcement of arbitral awards?

India

The Arbitration Act is the applicable legislation for the recognition and enforcement of an arbitral award in India.

India is a party to the Convention on the Execution of Foreign Arbitral Awards 1927 (the Geneva Convention) and the Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 (the New York Convention). India is also a signatory to bilateral investment treaties, which, typically, contain a dispute resolution clause. However, India is not a party to the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (the ICSID Convention).

Answer contributed by Sanjeev Kapoor and Saman Ahsan

16. Is the state a party to the 1958 New York Convention? If yes, what is the date of entry into force of the Convention? Was there any reservation made under Article I(3) of the Convention?

India

India is one of the original signatories to the New York Convention, which was ratified on 13 July 1960. India has made the following reservations to its applicability as per Section 44 of the Arbitration Act.

India will enforce an award as per the Convention only if it was made in the territory of another contracting state. Section 44 of the Act states the names of 48 countries to which the Convention will apply, which are states that have made reciprocal provisions for the recognition and enforcement of awards made in India. This data is available to the public.

Further, India will apply the Convention only to differences arising out of legal relationships, whether contractual or not, that are considered ‘commercial’ under Indian law.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

Recognition proceedings

17. Is there a time limit for applying for the recognition and enforcement of an arbitral award?

India

The Arbitration Act does not specify any time limit for applying for recognition and enforcement of a foreign award. However, the Indian Supreme Court in Government of India v. Vedanta Limited and Ors Civil Appeal No. 3185 of 2020 (Arising out of SLP (Civil) No. 7172 of 2020), placing reliance on Article 137 of the Schedule to the Limitation Act 1963, has clarified that an application seeking enforcement and recognition of a foreign award will have to be filed within three years of when the right to apply accrues.

As regards domestic awards, under Section 36(1) of the Arbitration Act, an award may be enforced in accordance with the provisions of the Code of Civil Procedure, as if it were a decree of the court, once the time for making an application to set aside the arbitral award under Section 34 has expired. However, when an application to set aside the arbitral award has been made, the filing of the application by itself shall not render the award unenforceable, unless the court grants an order of stay of the operation of the said arbitral award in accordance with the provisions of Subsection 36(3), on a separate application made for that purpose.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

18. Which court has jurisdiction over an application for recognition and enforcement of an arbitral award?

India

The high court with original jurisdiction to decide the questions forming the subject matter of a foreign arbitral award will have jurisdiction over an application for enforcement in terms of Section 47 read with Section 49 of the Arbitration Act.

In the case of a domestic award, the principal civil court of original jurisdiction in a district, and the high court in cases where the high court exercises ordinary original civil jurisdiction, would have jurisdiction to hear an application for enforcement of the award under Section 36 read with Section 2(1)(e)(i) of the Arbitration Act.

In accordance with Section 10 of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act 2015, all applications or appeals arising out of an international commercial arbitration are to be heard and disposed of by the commercial division of the high court (where a commercial division has been constituted in that high court).

In the case of an arbitration other than an international commercial arbitration, if the principal court of original jurisdiction is a district court, all applications or appeals arising out of the arbitration are to be heard and disposed of by the commercial court, where constituted. Further, if the high court has original pecuniary jurisdiction to entertain disputes over a particular pecuniary threshold, all applications or appeals arising out of that arbitration are to be heard and disposed of by the commercial division (where a commercial division has been constituted in that high court).

Note that the commercial division of a high court and the commercial court in a district court consist of judges who have experience in dealing with commercial disputes.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

19. What are the requirements for the court to have jurisdiction over an application for recognition and enforcement and for the application to be admissible? Must the applicant identify assets within the jurisdiction of the court that will be the subject of enforcement for the purpose of recognition proceedings?

India

An award holder must file its application for the enforcement of an arbitral award (whether foreign or domestic) before the competent court in whose jurisdiction the assets of the award debtor are located (Executive Engineer v. Atlanta Limited, 2014, 11 SCC 619; Tata International Ltd v. Trisuns Chemical Industry Ltd, 2001, SCC Online Bom 905; Wireless Developers Inc v. India Games Limited, 2012, SCC Online Bom 115). If the assets of the judgment debtor are located in the territorial jurisdiction of more than one court, the award holder can file execution petitions simultaneously in all competent courts (Bulk Trading SA v. Dalmia Cement (Bharat) Limited 2005 SCC Online Del 1389; Cholamandalam Investment and Finance Co Ltd v. CEC Ltd and Anr, 1995, SCC Online Del 240).

As a matter of practice, the applicant typically files a list of assets held by the judgment debtor with the enforcement petition (or states the reasons why it believes the assets of the judgment debtor are located within the territorial jurisdiction of the court where the execution proceedings are filed). If the award holder is unable to identify the assets of the judgment debtor, the award holder may make an application to the court requesting a disclosure of the assets held by the award debtor under provisions analogous to Order XXI, Rule 41 of the Code of Civil Procedure 1908 (CPC).

An application will be admissible if it meets the basic requirements set out under Section 47 of the Arbitration Act, namely, the party applying for the enforcement of a foreign award shall, at the time of the application, produce before the court (1) the original award or a copy thereof, duly authenticated in the manner required by the law of the country in which it was made, (2) the original agreement for arbitration or a duly certified copy thereof, and (3) such evidence as may be necessary to prove that the award is a foreign award. Additionally, if the award or agreement to be produced is in a foreign language, the party seeking to enforce the award shall produce a translation into English duly certified as correct by a diplomatic or consular agent of the country to which that party belongs.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

20. Are the recognition proceedings in your jurisdiction adversarial or ex parte? What are the different steps of the proceedings?

India

India follows the adversarial system. The courts will proceed ex parte only if the defendant fails to appear despite being served with proper notice of court proceedings.

An award may be recognised and enforced on the basis of an application made by the award holder under Section 47 of the Arbitration Act. The judgment debtor may file written objections challenging the application for recognition and enforcement of the award under Section 48 of the Act. Once the court is satisfied that the award is enforceable, the award is deemed to be a decree of that court under Section 49 of the Act and enforced as per the procedure laid down in the CPC.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

21. What documentation is required to obtain recognition?

India

Section 47(1) of the Arbitration Act provides that a party applying for the enforcement of a foreign award shall, at the time of the application, produce before the court (1) the original award or a copy thereof, duly authenticated in the manner required by the law of the country in which it was made, (2) the original agreement for arbitration or a duly certified copy thereof, and (3) such evidence as may be necessary to prove that the award is a foreign award. For example, in Hugo Neu Corporation v. Lloyds Steel Industries, 2009, SCC Online Bom 785, an affidavit was filed by the attorney appearing on behalf of the petitioner after the original award and other documents were destroyed. The court held that even though Section 47 provides that the award holder ‘shall’ produce such evidence with the application for enforcement of a foreign award, this being a procedural requirement, a pragmatic, flexible and non-formalist approach must be taken. The non-production of documents at the initial stage should not entail a dismissal of the application for enforcement. The party may be permitted to produce the evidence during the course of the proceedings, to enable the court to decide the enforcement petition. It has been observed that excessive formalism in the matter of enforcement of foreign awards must be deprecated.

Insofar as a domestic award is concerned, the original copy of the award must be filed in court. Indian courts have held that in the case of a domestic award, if the original award is not filed in court, a certified copy may be filed with an endorsement regarding whether the original award is duly stamped (and stating the value of the stamp duty paid) and specifying whether the original award is duly registered (Union of India v. M/S Gala Constructions, 2015, SCC Online MP 5908).

Answer contributed by Sanjeev Kapoor and Saman Ahsan

22. If the required documentation is drafted in a language other than the official language of your jurisdiction, is it necessary to submit a translation with an application to obtain recognition? If yes, in what form must the translation be?

India

Under Section 47(2) of the Arbitration Act, if any award or agreement sought to be produced under Subsection (1) of Section 47 is in a foreign language, then the party seeking to enforce the award will have to produce a translation of the award into English, certified as correct by a diplomatic or consular agent of the country to which that party belongs.

Alternatively, the award may also be certified as correct in such other manner as may be sufficient according to the law in force in India. In this regard, a translated copy of the award must be certified as correct by a notary appointed under the Notaries Act 1952. Further, a translation certified by a notary could be a translation of an award made by either the notary himself or herself, or any other person, but verified by the notary as correct (KTC Korea Company Limited v. Hobb International Pvt Ltd, 2004, SCC Online Cal 179).

Answer contributed by Sanjeev Kapoor and Saman Ahsan

23. What are the other practical requirements relating to recognition and enforcement? Are there any limitations on the language and length of the submissions and of the documentation filed by the parties?

India

A foreign award requires neither any registration nor any stamping, but can be enforced as a decree of the court (M/s Shriram EPC Limited v. Rioglass Solar SA, AIR 2018 SC 4539; Naval Gent Maritime Limited v. Shivnath Rai Harnarain (I) Limited, 2009, SCC Online Del 2961; Vitol SA v. Bhatia International Limited, 2014, SCC Online Bom 1058).

Under Section 35 of the Indian Stamp Act 1899, a domestic award that is unstamped, or is insufficiently stamped, is inadmissible for any purpose. As per Section 17 of the Registration Act 1908, an award, if it affects immovable property in the manner stated therein, would require compulsory registration, and will be invalid if it is not registered (Rajinder Parshad Sharma v. Ashok Sharma and Ors, 2008, SCC Online Del 1317).

The court fees required to be paid in any judicial proceeding are prescribed by the Courts Fees Act 1870. However, various states have amended court fee rates by state amendments to the Act or in their own Court Fees Act. Thus, the court fees payable will vary, depending on the court in which the execution proceedings are filed.

Section 47(2) of the Arbitration Act requires that if the award or agreement sought to be produced is in a foreign language, the party seeking to enforce the award must produce a translation in English certified as correct by a diplomatic or consular agent of the country to which the party belongs. There is no restriction on the length of the submissions, or the documents submitted in such proceedings.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

24. Do courts recognise and enforce partial or interim awards?

India

The definition under Section 2(1)(c) of the Arbitration Act of ‘arbitral award’ includes an interim award; thus, any interim or partial award can be enforced under Section 36 (domestic award) and Section 47 (foreign award) of the Act. However, for the purposes of recognition and enforcement under Indian law, the finality of the award is the determining factor. To be enforceable, the interim or partial award must finally determine the issues or claims covered by it. If the nature of the award is such that it is intended to have effect only if the final award is not delivered, then the award will not be enforceable (National Thermal Power Corporation Ltd (NTPC) v. Siemens Aktiengesellschaft 12, 2005, DLT 36).

Further, under Section 17 of the Act, which is applicable to domestic arbitrations, interim measures of protection may be passed by an arbitral tribunal during the arbitral proceedings, or at any time after the making of the arbitral award but before it is enforced. By virtue of amendments to Section 17 of the Arbitration and Conciliation (Amendment) Act 2015 (the Amendment Act), the arbitral tribunal has the same power for making orders under Section 17 of the Act as the court has for the purpose of, and in relation to, any proceedings before it under Section 9, and any such order passed by the arbitral tribunal is enforceable under the CPC, in the same manner as an order of the court.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

25. What are the grounds on which an arbitral award may be refused recognition? Are the grounds applied by the courts different from those provided under Article V of the New York Convention?

India

The grounds on which an award may be refused recognition under the Arbitration Act are similar to the grounds provided under Article V of the Convention.

Insofar as a foreign award is concerned, enforcement may refused under Section 48(1) of the Arbitration Act, at the request of the party against whom it is invoked, only if that party furnishes to the court proof that:

  • the parties to the agreement were, under the law applicable to them, under some incapacity, or the agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law of the country where the award was made;
  • 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 oro her case;
  • the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration (however, the proviso to Section 48(1)(c) clarifies that if the decisions on matters submitted to arbitration can be separated from those not so submitted, that part of the award which contains decisions on matters submitted to arbitration may be enforced);
  • the composition of the arbitration authority or the arbitration procedure was not in accordance with the agreement of the parties, or, absent any such agreement, was not in accordance with the law of the country where the arbitration took place; or
  • the award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made.

Additionally, the enforcement of a foreign arbitral award may also be refused if the court finds that the subject matter of the dispute is not capable of settlement by arbitration under the law of India, or the enforcement of the award would be contrary to the public policy of India. Similarly to Section 34, Section 48 of the Arbitration Act clarifies that an award is in conflict with the public policy of India, only if, inter alia, (1) the making of the award was induced or affected by fraud or corruption, or (2) it is in contravention with the fundamental policy of Indian law, or (3) it is in conflict with the most basic notions of morality or justice. The second explanation to Section 48(2) of the Act further clarifies that the test as to whether there is a contravention with the fundamental policy of Indian law shall not entail a review on the merits of the dispute.

Enforcement of a domestic award under Section 36 of the Arbitration Act may be refused if the award has been set aside on the grounds stated in Section 34 of the Act.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

26. What is the effect of a decision recognising an arbitral award in your jurisdiction?

India

Once the executing court is satisfied that an award is recognisable or enforceable, the award is deemed to be a decree of that court as per the provisions of Section 36 (domestic award) or Section 49 (foreign award) of the Arbitration Act. It may then be enforced under the relevant provisions of the CPC relating to execution of a decree.

There is no automatic stay on the enforcement proceedings. The court may order a stay on the enforcement of award at its own discretion if an application for setting aside the award, or for its suspension, has been made to the competent court. While passing an order for adjournment, on the application of the award creditor, the court may direct the other party to provide suitable security.

Delhi High Court in NTT Docomo Inc v. Tata Sons Ltd, 2017 (4) Arb LR 127 (Delhi) held that a third party to the arbitration proceedings has no locus to challenge the award under Section 48 of the Arbitration Act, since the remedy is available only to parties to the award.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

27. What challenges are available against a decision refusing recognition in your jurisdiction?

India

Under Section 50 of the Arbitration Act, an appeal lies against a decision refusing to recognise or enforce a foreign award to the high court concerned. Similarly, under Section 37 of the Arbitration Act, an appeal lies from an order of the court allowing or dismissing a challenge to a domestic award.

No second appeal lies from an order passed under Sections 37 and 50 of the Act. The aforementioned provisions do not take away the right of the parties to prefer a Special Leave Petition to the Supreme Court under Article 136 of the Constitution of India and the same would be maintainable.



Answer contributed by Sanjeev Kapoor and Saman Ahsan

28. What are the effects of annulment proceedings at the seat of the arbitration on recognition or enforcement proceedings in your jurisdiction?

India

The fact that an award may have been set aside or suspended by the competent authority of the country in which, or under the law of which, that award was made may be considered by the court as a ground to refuse enforcement of a foreign award.

Nevertheless, Indian courts have held that the enforcement court does not sit in appeal over the findings of the seat court. Furthermore, in view of the principles of comity of nations, the enforcement court would not comment on the judgments passed by courts in other jurisdictions and the enforcement of the award is a subsequent and distinct proceeding from the setting-aside proceedings at the seat. Thus, the enforcement court would independently determine the issue of recognition and enforceability of the foreign award and merely because the seat court has upheld the award would not mean that the enforcement court was bound to do the same (which would decide the issue based on the grounds set out in Section 48 of the Arbitration Act).

There have also been instances in which Indian courts have proceeded to decide the issue of enforceability of an award, notwithstanding the pendency of annulment proceedings filed at the seat.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

29. If the courts adjourn the recognition or enforcement proceedings pending annulment proceedings, will the defendant to the recognition or enforcement proceedings be ordered to post security?

India

Under Section 34 (domestic award) and Section 48 (foreign award) of the Arbitration Act, a court may order the award debtor to give suitable security pending the outcome of the annulment proceedings.

While considering directing an award debtor to post security, the courts are required to satisfy themselves that the deposit of security by the award debtor is essential and adequate to safeguard the interests of the award holder (Steel Authority of India Limited v. AMCI PTY Limited (2011) SCC Online Del 3689). Factors such as the financial condition of the award debtor and the likelihood of the award debtor disposing of his or her assets prior to payment of the award may be relevant considerations in this regard (CV Rao v. Strategic Port Investment (2014) SCC Online Del 444; Aditya Birla Finance Limited v. Carnet Elias Fernandes (2014) SCC Online Bom 4774).

The courts may direct the award debtor either to deposit a sum equivalent to the sum awarded to the award holder in court, or to furnish a bank guarantee of an equivalent amount and keep the same alive until the execution proceedings are pending before the court. Alternatively, the court may direct the award debtor to earmark assets that may be used for satisfaction of the award and prohibit the award debtor from creating any third-party rights over those assets.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

30. Is it possible to obtain the recognition and enforcement of an award that has been fully or partly set aside at the seat of the arbitration? If an arbitral award is set aside after the decision recognising the award has been issued, what challenges are available?

India

Under Section 48 of the Arbitration Act, the court cannot enforce an award that is not binding on the parties. Indian courts have held that an award becomes binding between the parties if it was not challenged by the award debtor in the country where the award was passed and hence became executable. Thus, if the award has been fully or partly set aside at the seat of arbitration, the award would not be binding on the parties to the extent of the same having been set aside and consequently would be unenforceable. Further, in light of Section 48(3) of the Act, the courts are likely to await the outcome of the proceedings if the award has been challenged before the courts of the seat of arbitration and proceed with enforcement only thereafter.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

Service

31. What is the procedure for service of extrajudicial and judicial documents to a defendant in your jurisdiction? If the extrajudicial and judicial documents are drafted in a language other than the official language of your jurisdiction, is it necessary to serve these documents with a translation?

India

The procedure applicable for service of extrajudicial and judicial documents to a defendant in Indian jurisdiction is, inter alia, governed by the Convention on Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters 1965 (the Hague Service Convention), which has been signed by India. However, India has expressed reservations on Article 10 of the Hague Service Convention and has objected to the following modes of service:

  • sending judicial documents, by postal channels, directly to persons abroad;
  • effecting service of judicial documents directly through the judicial officers, officials or other competent persons of the state of destination by judicial officers, officials or other competent persons of the state of origin; and
  • effecting service of judicial documents directly through the judicial officers, officials or other competent persons of the state of destination by any person interested in a judicial proceeding.

Therefore, the only process permitted by India for a valid service of judicial or extrajudicial documents under the Hague Service Convention is through the means of transmission set out in Article 5 thereof (i.e., through the designated central authority). The designated central authority for service in India is the Ministry of Law and Justice.

The Ministry of Law and Justice has laid down that all requests for service of documents in India should be in English or accompanied by an English translation.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

32. What is the procedure for service of extrajudicial and judicial documents to a defendant outside your jurisdiction? Is it necessary to serve these documents with a translation in the language of this jurisdiction?

India

The service of extrajudicial and judicial documents outside the Indian territory may be done in accordance with the provisions of the Hague Service Convention, provided that the receiving country is a signatory of that Convention. Alternatively, the provisions under the law of the country where the receiving party resides may apply.

Additionally, the CPC, under Section 29(c), lays down the procedure in connection with the service of foreign summons and other processes issued by any other civil or revenue court outside India. These summons and other processes may be sent to courts in the territory of India to which the CPC extends and can be served as if they were summons issued by those courts. India has also entered into mutual legal assistance treaties in civil and commercial matters with certain countries for reciprocal arrangements for service of summons (CPC, Section 29(c)), execution of civil decrees (CPC, Section 44A), issuing letters of request (CPC, Section 77), taking of evidence (CPC, Section 78) and enforcement of arbitral awards (CPC, Section 44(b)).

Additionally, Order V of the CPC is applicable for service of summons. Further, Order V, Rule 25 provides that if a defendant resides outside India and the defendant does not even have an agent in India empowered to accept service, summons shall be addressed at the place where the defendant resides. The summons shall be sent to the defendant by registered post or by such courier service as may be approved by the high court or by fax or by email, as approved by the rules of the concerned high court. In addition to the provisions of the CPC, the service of judicial documents is also regulated by rules of various high courts across India.

Under the Hague Service Convention, the central authority of the addressed state may require that the documents be written in or translated into the official language of that state.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

Identification of assets

33. Are there any databases or publicly available registers allowing the identification of an award debtor’s assets within your jurisdiction?

India

Although there is no publicly available database dedicated particularly to identifying company assets, one may access the financial statements (including balance sheets) of companies from the public documents portal on the website of the Ministry of Corporate Affairs (www.mca.gov.in). 

Answer contributed by Sanjeev Kapoor and Saman Ahsan

34. Are there any proceedings allowing for the disclosure of information about an award debtor within your jurisdiction?

India

Since an arbitral award is enforced as a decree of the court, provisions of the CPC would be applicable at the stage of enforcement of the award. Order XXI, Rule 41(2) of the CPC contemplates that when a decree for payment of money has remained unsatisfied for 30 days, the court may order the officers of the judgment debtor company to disclose its assets by furnishing an affidavit stating the particulars of the assets of the judgment debtor. The decree holder will have to make an application in the execution proceedings before the court in this regard. Courts have held that such an application can be filed even before presentation of the execution petition. In such cases, the decree holder can apply under Order XXI, Rule 41 of the CPC to retrieve details of the judgment debtor’s assets that are known only by the judgment debtor.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

Enforcement proceedings

35. What kinds of assets can be attached within your jurisdiction?

India

The principles enshrined under Section 60 of the CPC apply to the execution of arbitral awards, providing that all saleable property, whether movable or immovable, may be attached in execution proceedings – including land, houses or other buildings, goods, money, bank notes, negotiable instruments such as promissory notes, bills of exchange and cheques, government securities, bonds or other securities for money, debt, shares in a corporation. The assets that may be attached may either belong to the judgment debtor or be assets over which the judgment debtor has disposing power. The assets may therefore be held in the name of the judgment debtor or by another person in trust for the benefit of the judgment debtor.

The proviso to Section 60 specifies the types of properties that are not liable to be attached, such as tools of artisans and implements of husbandry (which may be necessary to earn a livelihood), the mere right to sue for damages, any right of personal service, money payable under insurance for against the life of the judgment debtor, or any allowance declared by Indian law to be exempt from liability to attachment.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

36. Are interim measures against assets available in your jurisdiction?

India

Yes. If the agreement contains an arbitration clause, then interim measures of protection may be sought by a party under Sections 9 and 17 of the Arbitration Act in respect of any of the following matters:

  • the preservation, interim custody or sale of any goods that are the subject matter of the arbitration agreement;
  • securing the amount in dispute;
  • the detention, preservation or inspection of any property or thing that is the subject matter of the dispute;
  • an interim injunction or the appointment of a receiver; or
  • another interim measure of protection as may appear to the court to be just and convenient.

These orders can then be enforced as per the provisions of the CPC.

In respect of sovereign states, India does not have separate legislation on sovereign immunity, unlike the United States and the United Kingdom. Although India is a signatory to the Convention on the Jurisdictional Immunities of the States and their Property (the UN Convention), it is yet to come into force in India.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

37. What is the procedure to apply interim measures against assets in your jurisdiction?

India

In the execution of an award, an application may be made to the court under provisions analogous to Order XXI, Rule 12 (movable property) or Rule 13 (immovable property) of the CPC for interim measures against assets belonging to the judgment debtor. In this regard, once a party moves such an application, the court may issue temporary orders or interim orders in respect of the assets located within its jurisdiction. It will also issue notice to the decree debtor of the execution proceedings being filed. If the decree debtor does not attend, the execution proceedings may be proceeded ex parte.

Additionally, interim measures of protection are available against the assets of an award debtor under Sections 9 and 17 of the Arbitration Act, before or during arbitral proceedings, or at any time after the arbitral award is made, but before it is enforced.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

38. What is the procedure for interim measures against immovable property within your jurisdiction?

India

As per Order XXI, Rule 13 of the CPC, when an application is made for the attachment of any immovable property belonging to the judgment debtor, it must contain a description of the property sufficient to identify it and, if the property can be identified by boundaries or numbers in a record of settlement or survey, a specification of those boundaries or numbers. The application should also include a specification of the judgment debtor’s share or interest in the property to the best of the belief of the applicant, and so far as he or she has been able to ascertain the same.

Further, under Section 9 of the Arbitration Act, a party may apply to a competent court for an interim measure of protection in respect of immovable property by way of the preservation, interim custody or sale of immovable property; the detention, preservation or inspection of any immovable property; an interim injunction or the appointment of a receiver in respect of any immovable property; and any other interim measure of protection as may appear to the court to be just and convenient.

Similarly, under Section 17 of the Arbitration Act, a party may apply to the tribunal (from its constitution to rendering of the award) for an interim measure of protection in respect of immovable property by way of the preservation, interim custody or sale of immovable property; the detention, preservation or inspection of any immovable property; an interim injunction or the appointment of a receiver in respect of any immovable property; and any other interim measure of protection as may appear to the tribunal to be just and convenient.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

39. What is the procedure for interim measures against movable property within your jurisdiction?

India

As per the provisions of Order XXI, Rule 12 of the CPC, an application may be made to the executing court for attachment of any movable property belonging to the judgment debtor (but not in possession of the judgment debtor) along with an inventory of the property, containing a reasonably accurate description of the same.

Further, under Section 9 of the Arbitration Act, a party may apply to a court for an interim measure of protection in respect of movable property by way of the preservation, interim custody or sale of any movable property; the detention, preservation or inspection of any movable property; an interim injunction or the appointment of a receiver in respect of any movable property; and any other interim measure of protection as may appear to the court to be just and convenient.

Similarly, under Section 17 of the Arbitration Act, a party may apply to the tribunal (from its constitution to rendering of the award) for an interim measure of protection in respect of movable property by way of the preservation, interim custody or sale of movable property; the detention, preservation or inspection of any movable property; an interim injunction or the appointment of a receiver in respect of any movable property; and any other interim measure of protection as may appear to the tribunal to be just and convenient.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

40. What is the procedure for interim measures against intangible property within your jurisdiction?

India

For the purposes of obtaining interim measures against intangible property, the provisions under Order XXI, Rules 46, 47, 48 and 48-A of the CPC may be applied, which provide the procedure for attachment of intangible movable property. These provisions include attachment of debt, shares, shares in moveables, salary or allowances of government servants or of railway employees or of employees of the local authority, and salary or allowances of private employees. These attachments can be made by the executing court by issuing prohibitory orders against persons holding the assets.

Further, a party may apply to a court or a tribunal for an interim measure of protection in respect of intangible property under Section 9 or 17 of the Arbitration Act, respectively.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

41. What is the procedure to attach assets in your jurisdiction?

India

On an application made by the decree holder in the execution proceedings, the court may require the judgment debtor to make a disclosure of its assets and investments, after which the court may issue prohibitory orders. The decree holder is required to obtain prior authorisation of the court before attaching the assets of the judgment debtor. Proceedings for attachment of assets are not ex parte, unless the judgment debtor fails to appear after proper service.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

42. What is the procedure for enforcement measures against immovable property within your jurisdiction?

India

To effect an attachment of immovable property, it is necessary, among other measures, to obtain an order prohibiting the judgment debtor from transferring, alienating or charging the property in any way.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

43. What is the procedure for enforcement measures against movable property within your jurisdiction?

India

If the property to be attached is movable property in the possession of the judgment debtor, the attachment is made by actual seizure. The attaching officer keeps the property in his or her own custody or in the custody of one of his or her subordinates.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

44. What is the procedure for enforcement measures against intangible property within your jurisdiction?

India

For the purposes of obtaining interim measures against intangible property, the provisions under Order XXI, Rules 46, 47, 48 and 48-A of the CPC may be applied, which provide for the procedure of attachment of intangible movable property. These provisions include attachment of debt, shares, shares in movables, salary or allowances of government servants or of railway employees or of employees of the local authority, and salary or allowances of private employees. These attachments can be made by the executing court by issuing prohibitory orders against persons holding the assets.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

45. Is it possible in your jurisdiction to attach bank accounts opened in a branch or subsidiary of a foreign bank located in your jurisdiction or abroad? Is it possible in your jurisdiction to attach the bank accounts opened in a branch or subsidiary of a domestic bank located abroad?

India

Although there is no judicial precedent, ordinarily courts will have jurisdiction over entities situated within their territorial jurisdiction and, thus, executing courts in India should be able to attach bank accounts opened in an Indian branch of a foreign bank. Note that in some judgments (rendered in the context of tax laws), courts have ruled that individual branches or subsidiaries of foreign banks are considered separate entities and bank accounts maintained with a branch or subsidiary of a foreign bank have been attached pursuant to tax assessments.

Insofar as foreign branches of an Indian bank are concerned, although the courts may not have direct jurisdiction over these branches, the executing court may pass appropriate directions against the domestic bank to exercise its control in such a manner that it results in attachment or freezing of the bank account opened abroad.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

Enforcement against foreign states

46. Are there any rules in your jurisdiction that specifically govern recognition and enforcement of arbitral awards against foreign states?

India

There are no specific rules governing recognition and enforcement of arbitral awards against sovereign states. Although Section 86 of the CPC (which governs the issue of foreign state immunity) contemplates prior consent of the central government before instituting a suit in any court of law against a foreign state, such enforcement proceedings are not barred. In relation to the execution of an arbitral award, the courts in India have given the word ‘suit’ a narrow interpretation and have held that passing a ‘judgment and decree on an arbitration award’ does not commence with a plaint, or a petition in the nature of a plaint (Nawab Usmanali Khan v, Sagarmal, AIR 1965 SC 1798). Therefore, the execution proceedings in respect of an arbitral award cannot be regarded as a suit for the purposes of Section 86 of the CPC. In Ethiopian Airlines v. Ganesh Narain Saboo (2011) 8 SCC 539, the Supreme Court of India held that sovereign immunity to a foreign state cannot apply to commercial transactions and that the contracting party should be held liable for its contractual and commercial activities and obligations.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

47. May award creditors apply interim measures against assets owned by a sovereign state?

India

An award creditor can apply interim measures against the assets owned by a sovereign state. The Supreme Court in Pam Development v. State of West Bengal (2019) 8 SCC 112 held that parties to an arbitration are to be treated equally, and that no special treatment could be accorded to the government when it is a party to the arbitration proceedings.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

48. What is the procedure for service of extrajudicial and judicial documents to a foreign state? Is it necessary to serve extrajudicial and judicial documents with a translation in the language of the foreign state?

India

There is no specific procedure for service of extrajudicial and judicial documents to a foreign state. However, the service of extrajudicial and judicial documents outside the Indian territory may be done in accordance with the provisions of the Hague Service Convention, provided that the receiving country is a signatory of that Convention. Alternatively, the provisions under the law of the country where the receiving party resides may apply.

Under the Hague Service Convention, if the documents are to be served on a signatory nation, the central authority of the addressed state may require that the documents be written in or translated into an official language of that state.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

49. Are assets belonging to a foreign state immune from enforcement in your jurisdiction? Are there exceptions to immunity?

India

Assets belonging to a foreign state are not absolutely immune from enforcement in India. Under Section 86 of the CPC, a foreign state can be sued in suit proceedings, subject to the condition that consent of the central government has been obtained, duly certified in writing by the Secretary to that government. Subsection (3) of Section 86 of the CPC specifically requires the consent of the central government for the execution of a decree against the property of any foreign state. Whether an entity will qualify as a ‘foreign state’ depends on the nature of its constitution and the extent of control the government exercises on that entity.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

50. Is it possible for a foreign state to waive immunity from enforcement in your jurisdiction? What are the requirements of waiver?

India

The assets of a foreign state are not absolutely immune from enforcement in India. Any immunity may be waived by a foreign state either expressly or impliedly. Indian courts have upheld that waiver is effective when the sovereign itself invokes the jurisdiction as a plaintiff or when it appears as a defendant without objection and fights the case on its merits. As an example, in Ethiopian Airlines v. Ganesh Narin Saboo, AIR 2011 SC 3495, the Indian Supreme Court held that, in effect, by entering into the Convention for the Unification of Certain Rules Relating to International Carriage by Air (the Warsaw Convention), Ethiopia had expressly waived its airline’s right to immunity in cases relating to aircraft carriers.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

51. Is it possible for a creditor of an award rendered against a foreign state to attach the assets held by an alter ego of the foreign state within your jurisdiction?

India

There are no helpful precedents on the attachment of assets of an alter ego of a foreign state within the Indian jurisdiction. However, in limited circumstances, the courts have permitted the attachment of assets of an alter ego of a corporation against which an award is rendered. In Cheran Properties v. Kasturi and Sons Ltd (2018) 16 SCC 413, the Supreme Court held that an award may be enforced against a non-signatory in situations such as a principal-agent relationship, apparent authority, piercing of the corporate veil, joint venture relations, succession and estoppel, the basis being the force of applicable law. Similarly, non-signatories may be bound under the ‘group of companies’ doctrine, where the basis for binding a non-signatory to the proceedings is an implied intention to bind the non-signatories as well.

Answer contributed by Sanjeev Kapoor and Saman Ahsan

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