2012 (1) TMI 391 - HC - Indian Laws

Summary

Issues Involved:
1. Enforcement of Foreign Arbitral Award
2. Territorial Jurisdiction of the Court
3. Application under Section 34 of the Arbitration and Conciliation Act
4. Public Policy and Ex-parte Award

Summary:

1. Enforcement of Foreign Arbitral Award:
The appellant obtained an arbitral award in the USA against the respondent and sought to enforce and execute it in India. The appellant filed an application u/s Order 21 Rule 22 of the Code of Civil Procedure 1908 for leave to execute the foreign award.

2. Territorial Jurisdiction of the Court:
The respondent challenged the foreign award under Section 34 of the Arbitration and Conciliation Act 1996 (the Act) in the High Court, which was returned due to lack of jurisdiction. The appellant argued that the court has jurisdiction as the respondent's bank account is within its territorial limits. The court concluded that the territorial jurisdiction of the Executing Court for enforcement of foreign awards under Section 48 of the Act must be considered where the respondent's property is located.

3. Application under Section 34 of the Arbitration and Conciliation Act:
The respondent's application u/s 34, initially filed in the High Court, was returned for lack of jurisdiction and is now pending in the Thane District Court. The appellant argued that enforcement should proceed as the respondent's bank account is within the jurisdiction of the High Court.

4. Public Policy and Ex-parte Award:
The respondent contended that the ex-parte award is against public policy in India and sought to set it aside u/s 34 of the Act. The court noted that the enforcement of the award could be refused if it is contrary to public policy u/s 48 of the Act. The Supreme Court's judgment in Venture Global Engineering Vs. Satyam was cited, establishing that Section 34 applies to foreign awards and that the respondent cannot be deprived of challenging the award on public policy grounds.

Conclusion:
The High Court held that it has territorial jurisdiction to enforce the award as the respondent's bank account is within its limits. The application u/s 34 pending in Thane District Court should be returned and re-presented to the High Court to be disposed of along with the execution application. The appeal was allowed, and the impugned order was set aside. The court declined the appellant's request to stay the judgment for further legal recourse.