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TMI Blog2016 (5) TMI 770X X X X Extracts X X X X X X X X Extracts X X X X ..... dia and the Arbitration should be governed by the law of a foreign country. We are thus of the view that by Clause 28, the parties chose to exclude the application of Part I to the Arbitration proceedings between them by choosing London as the venue for Arbitration and by making English law applicable to Arbitration, as observed earlier. It is too well settled by now that where the parties choose a juridical seat of Arbitration outside India and provide that the law which governs Arbitration will be a law other than Indian law, part I of the Act would not have any application and, therefore, the award debtor would not be entitled to challenge the award by raising objections under Section 34 before a Court in India. A Court in India could not have jurisdiction to entertain such objections under Section 34 in such a case. The proceedings under Section 34, which occurs in Part I, are liable to be dismissed as untenable. The Civil Appeals of Eitzen are liable to succeed and are, therefore, allowed. The judgment of the Bombay High Court enforcing the Foreign Award under Part II of the Arbitration Act is correct and liable to be upheld. - Civil Appeal Nos. 5131-5133 of 2016 (Arisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Gujarat High Court was dismissed as withdrawn on 2.7.2009. 5. In London, Mr. Tim Marshal, who was appointed as Arbitrator, held that Ashapura was in repudiatory breach and awarded Eitzen Bulk an amount of 36,306,104.00 $ plus interest, as stated above. 6. Having failed to stall the Arbitration and then having failed in the Arbitration proceedings, Ashapura resorted to Section 34 of the Arbitration Act and filed objections in India in respect of the Award passed in London. These proceedings were filed before the District Judge, Jamnagar for setting aside the Foreign Award made in London. A Misc. Civil Application No. 101/2009 for injunction restricting Eitzen Bulk from enforcing the Award in foreign jurisdictions outside India was also moved. The District Judge, Jamnagar on 24.8.2009 dismissed the application for injunction seeking restraint on enforcement of the Award. 7. From 14.7.2009 to 3.8.2009 Eitzen applied for enforcement of the Award in the countries of Netherlands, USA, Belgium, UK. The Courts in various jurisdictions have held the Award to be enforceable as a judgment of the Court. 8. On 14th July, 2009, the appellant filed proceedings in Netherlands Court se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Court in India to decide objections under Section 34 of the Arbitration Act in respect of a Foreign Award by way of a Writ Petition. They prayed for issue of a Writ of Prohibition and an Order restraining the learned District Judge at Jam-Khambhalia from adjudicating Ashapura s application under Section 34 of the Arbitration and Conciliation Act, 1996 against the Foreign Award dated 26.5.2009. 14. A learned Single Judge issued notice and stayed further proceedings before the Jamnagar Court on 20.11.2009. Ashapura however filed LPA No. 2469 of 2009 challenging the Order of the learned Single Judge dated 20.11.2009. The Division Bench which heard the appeal has held by Judgment and Order dated 22.9.2010, that Ashapura is entitled to challenge the Foreign Award under Section 34 of Part I of the Arbitration Act. It has further held that the territorial jurisdiction is a mixed question of fact and law and is required to be decided by the Trial Court on the basis of the Plaint and Written Statement and Evidence before it. This judgment was questioned by way of SLP (C) Nos. 2210-2212 of 2011 filed by Eitzen. Proceedings in Maharashtra 15. On 27.7.2009, Eitzen filed Arbitration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jected the contention of Ashapura under Section 42 Notwithstanding anything contained elsewhere in this Part or in any other law for the time being in force, where with respect to an arbitration agreement any application under this Part has been made in a Court, that Court alone shall have jurisdiction over the arbitral proceedings and all subsequent applications arising out of that agreement and the arbitral proceedings shall be made in that Court and in no other Court. of the Arbitration Act, rightly; that since an application under Section 34 of the Arbitration Act, which is an application contemplated by Part I of the Arbitration Act, has been made before the Court in Gujarat and that Court alone has jurisdiction over the Arbitration proceedings and all subsequent applications must be made to that Court alone. This contention was rejected by the High Court on the ground that Section 42 occurs in Part I of the Arbitration Act and in its view since Part I itself had no application to the Foreign Award, Section 42 would have no application either. The moot question thus arises is whether Part I of the Arbitration Act has any application to the Foreign Award in this case where the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he learned counsel for the parties is whether Part I of the Arbitration Act is excluded from its operation in case of a Foreign Award where the Arbitration is not held in India and is governed by foreign law. 25. Shri Prashant S. Pratap, learned senior counsel appearing for Eitzen submitted that the main issue is covered by a decision of this Court in Bhatia International v. Bulk Trading S.A. and another (2002) 4 SCC 105 and two recent decisions of this Court in Union of India v. Reliance Industries Limited and others (2015) 10 SCC 213 and Harmony Innovation Shipping Limited v. Gupta Coal India Limited and another (2015) 9 SCC 172. We have not considered the decision in the Balco v. Kaiser Aluminium Technical Services Inc. (2012) 9 SCC 552 since the decision in that case does not govern Arbitration agreements entered prior to 6.9.2012 and the contract in the instant case is dated 18.1.2008. 26. According to the learned counsel, Clause 28, which is the Arbitration Clause in the Contract, clearly stipulates that any dispute under the Contract is to be settled and referred to Arbitration in London . It further stipulates that English Law to apply. The parties have thus clearly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of some other jurisdictions and observed in paragraphs 55 to 57 as follows:- 55. The effect of choice of seat of arbitration was considered by the Court of Appeal in C v. D. This judgment has been specifically approved by this Court in Balco and reiterated in Enercon. In C v. D, the Court of Appeal has observed: (Bus LR p. 851, para 16) Primary conclusion 16. I shall deal with Mr Hirst s arguments in due course but, in my judgment, they fail to grapple with the central point at issue which is whether or not, by choosing London as the seat of the arbitration, the parties must be taken to have agreed that proceedings on the award should be only those permitted by English law. In my view they must be taken to have so agreed for the reasons given by the Judge. The whole purpose of the balance achieved by the Bermuda form (English arbitration but applying New York law to issues arising under the policy) is that judicial remedies in respect of the award should be those permitted by English law and only those so permitted. Mr Hirst could not say (and did not say) that English judicial remedies for lack of jurisdiction on procedural irregularities under Sections 67 and 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n India and England for redressal of their grievances. The provisions of Part I of the Arbitration Act, 1996 (Indian) are necessarily excluded; being wholly inconsistent with the arbitration agreement which provides that arbitration agreement shall be governed by English law . Thus the remedy for the respondent to challenge any award rendered in the arbitration proceedings would lie under the relevant provisions contained in the Arbitration Act, 1996 of England and Wales. Whether or not such an application would now be entertained by the courts in England is not for us to examine, it would have to be examined by the court of competent jurisdiction in England. 29. We are in agreement with the above observation and in this clause 28 in the present case must be intended to have a similar effect that is to exclude the applicability of Part I of the Indian Arbitration and Conciliation Act since the parties have chosen London as the seat of Arbitration and further provided that the Arbitration shall be governed by English Law. In this case the losing side has relentlessly resorted to apparent remedies for stalling the execution of the Award and in fact even attempted to prevent Ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nless the parties by agreement, express or implied, exclude all or any of its provisions. In that case the laws or rules chosen by the parties would prevail. Any provision, in Part I, which is contrary to or excluded by that law or rules will not apply. 32. We are thus of the view that by Clause 28, the parties chose to exclude the application of Part I to the Arbitration proceedings between them by choosing London as the venue for Arbitration and by making English law applicable to Arbitration, as observed earlier. It is too well settled by now that where the parties choose a juridical seat of Arbitration outside India and provide that the law which governs Arbitration will be a law other than Indian law, part I of the Act would not have any application and, therefore, the award debtor would not be entitled to challenge the award by raising objections under Section 34 before a Court in India. A Court in India could not have jurisdiction to entertain such objections under Section 34 in such a case. 33. As a matter of fact the mere choosing of the juridical seat of Arbitration attracts the law applicable to such location. In other words it would not be necessary to specify ..... X X X X Extracts X X X X X X X X Extracts X X X X
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