2019 (5) TMI 1852 - HC - Indian Laws

Territorial Jurisdiction - enforcement of an award - Agreements between the parties which led to the dispute, registered office of the respondents and land in relation to which the Agreements were executed, all situated in Kolkata - Explanation to Section 47 of the Arbitration and Conciliation Act, 1996 - it is also submitted that petitioner had also filed an application under Section 9 of the Act before the High Court of Calcutta, which has not been disclosed in the present petition - HELD THAT - Section 48 of the Act gives the circumstances where the enforcement of a Foreign Award may be refused at the request of the party against whom it is invoked. As on date, the respondents are yet to file any application claiming such grounds. Unless such grounds are established, the Court has to prima facie assume that the Foreign Award that has been produced before it is capable of being enforced and therefore, grant interim protection in favour of the petitioner producing such an Award and seeking enforcement of the same. The learned senior counsels for the respondents have further raised an objection on the Award being not enforceable as being violative of the Foreign Exchange Management Act, 1999 and Section 74 of the Indian Contract Act, 1872. The submissions so made would have to be considered once the respondents file a proper application under Section 48 of the Act. The respondent no. 1 is directed to file an affidavit of its assets in Form 16A Appendix E of Code of Civil Procedure, 1908 within a period of four weeks from today. The respondents are further restrained from creating any third party interest or parting with the possession of Westin Hotel, Rajarhat, Kolkata - List on 8th August, 2019.

Summary

Issues:
1. Territorial jurisdiction of the court to entertain the petition.
2. Concealment of vital facts in the petition.
3. Enforceability of the Arbitral Award under Section 49 of the Act.
4. Application for setting aside the Award under Article 34 of the UNCITRAL Model Law.
5. Enforcement of a Foreign Award under Section 48 of the Act.
6. Violation of Foreign Exchange Management Act, 1999, and Section 74 of the Indian Contract Act, 1872.

Analysis:
1. The respondents raised a preliminary objection on the territorial jurisdiction of the court based on the location of the agreements and the registered office. The petitioner argued that the court has jurisdiction as per previous judgments. The court agreed with the petitioner, citing relevant case laws supporting its jurisdiction.

2. The respondents contended that the petitioner had filed an application under Section 9 of the Act before another court, which was not disclosed. The court noted this objection but did not find merit in it based on the arguments presented and relevant legal provisions.

3. The respondents argued that the Arbitral Award was not enforceable as they had a period to challenge it under the UNCITRAL Model Law. The court disagreed, citing provisions and case laws to support its decision that the Award could be enforced.

4. The court discussed the timeline for challenging the Award under Article 34 of the UNCITRAL Model Law and clarified the provisions regarding the enforceability of the Award.

5. The respondents raised objections regarding the enforceability of the Foreign Award under Section 48 of the Act. The court explained the grounds for refusal of enforcement and emphasized the need for the respondents to establish valid grounds for non-enforceability.

6. The respondents objected to the Award, alleging violations of specific laws. The court directed the respondents to file an affidavit of assets and imposed restrictions on creating third-party interests. The court set a future date for further proceedings.

This detailed analysis covers the various issues raised in the judgment, including jurisdiction, enforceability of the Award, and objections regarding violations of laws. The court's reasoning and references to legal provisions and case laws provide a comprehensive understanding of the judgment.