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Supreme Court's pro-enforcement approach
INTRODUCTION
The Supreme Court recently affirmed the implementation of an international arbitral award in the case of Government of India v. Vedanta Limited, finding that the enforcement petition was submitted within three years of the date when the right to submit accrued. The Supreme Court ruled that an application for the prosecution of an international arbitral award may be lodged up to three years after the privilege to apply accrues, reading the Limitation Act of 1936.
FACTS
The Government of India wanted to explore and expand the petroleum resources in the Ravva Gas and Oil Fields in 1993, so it issued a global competitive tender to solicit offers. Accordingly, the predecessors of the Respondents, Videocon International Ltd. and Command Petroleum Holdings NV, submitted a proposal to expand the Ravva Field alongside other bidders. A Revenue Share Arrangement was to be used to award the contract for this petroleum construction.
On October 28, 1994, the Government of India and the parties signed a Production Sharing Contract (the "PSC") to explore and develop the Ravva Oil and Gas Field commercially.
HELD
The Court first clarified the rule on the time limit for applying for the enforcement of a foreign award. The Court referred to Bank of Baroda v. Kotak Mahindra Bank to explain that since Article 136 of the Limitation Act, 1963 only applies to decrees of a civil court in India, the execution of an international award will be protected by a residuary clause, namely Article 137 of the Limitation Act, which prescribes a three-year term from the time the right to apply accrues.
Further, the court considered whether the international award was against Indian public policy or not. The Court relied on Renusagar Power Ltd v. General Electric Co to maintain the public policy defence, which could only be used where enforcing the award would breach the forum state's basic notions of morals and justice. The Court then cited Albert van den Berg's Commentary on "The New York Arbitration Convention, 1958: Towards a Uniform Judicial Interpretation" as well as ICCI's guide to infer that there would be no merits investigation.
CONCLUSION
The Supreme Court's pro-enforcement approach in the Vedanta decision would have far-reaching implications in terms of making India a favoured arbitration centre and, as a result, encouraging an international venture environment. Having a pro-enforcement mechanism would go a long way toward building and transforming India into a foreign arbitration centre. Still, it will require drastic measures to do so. The government must take a strategy that encourages international investors to invest in India. In addition, for India to realise its dream of being a global arbitration centre, the courts will have to adopt the pro-arbitration framework, in which minimal interference is used while enforcing an international arbitral award, as depicted by the judiciary in the Vedanta Judgment.
In terms of amicus curiae appointments, one can confidently assume that the impact an amicus curiae can have on the court cannot be underestimated. As a result, amicus status can only be granted where the amicus provides any unique insight or knowledge that may help the court above what the parties' attorneys would offer. Also applicable is the criterion for amicus curiae admissibility.
This article is based purely on the author's personal views and opinions in exercising the fundamental right guaranteed under Article 19(1)(a) and other related laws being a force in India for the time being. Further, despite all efforts made to ensure the accuracy and correctness of the information published, the white code VIA Mediation and arbitration centre shall not be responsible for any errors caused due to human error or otherwise.
This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being. Further, despite all efforts made to ensure the accuracy and correctness of the information published, White Code VIA Mediation and Arbitration Centre shall not be responsible for any errors caused due to human error or otherwise.
- Introduction
- Analysis of the judgment
- Conclusion
