Case Summary: Raffles Design International India Pvt. Ltd. v. Educomp Professional Education Ltd.
The High Court of Delhi, in the case of Raffles Design International India Pvt. Ltd. v. Educomp Professional Education Ltd., has continued to show the Indian judiciary’s support for international arbitrations.
The Court has struck down challenges to a petition seeking interim relief in a Singapore seated arbitration. The Court also provided a liberal interpretation to the Arbitration and Conciliation (Amendment) Act, 2015 and held that the provisions of the Amendment Act are applicable to all arbitration-related court proceedings instituted after the Amendment Act came into force, even if the related arbitration was commenced before the Amendment Act.
In this case, the parties had agreed to resolve their disputes through arbitration, seated in Singapore. The relevant Join Venture Agreement was governed by Singapore law, and the arbitration was to be conducted in accordance with the rules of the SIAC.
After disputes arose between the parties, the Petitioner initiated arbitration proceedings in Singapore. They also filed for appointing an emergency arbitrator. On this application, the emergency arbitrator granted certain interim reliefs to the Petitioner. Subsequently, a consent award was passed by the sole arbitrator.
In due course, the Respondent acted in contravention of the Emergency Award. The Petitioner, therefore, filed an application before the Delhi High Court, under section 9 of the ACA, 1996 seeking interim reliefs similar to what had been granted under the Interim Emergency Award. The maintainability of the Petition was challenged by the Respondent.
The Court after setting out detailed reasons held that the Amendment Act would be applicable to all arbitration-related court proceedings commenced after 23 October 2015, even if the related arbitration is instituted prior to 23 October 2015.
The Court relied on section 26 of the Amendment Act, which provides that the Act will not be applicable to the arbitral proceedings commenced before the Amendment Act, while it would apply in relation to arbitral proceedings commenced on or after the commencement of the Amendment Act.
The Court held that the use of the phrase “in relation to” indicates that the legislature intended the second limb of the provision to have a wider sweep covering all proceedings which are connected to arbitral proceedings, including court proceedings.
The last issue before the court was whether the Petitioner was permitted to approach the Court for interim relief, considering it has already obtained an emergency/ interim award in the arbitration.
The Court held that a party is not precluded from seeking interim measures from a court merely because it obtained a similar order from an arbitral tribunal. It further held that the court, in considering a petition under section 9, should not be influenced by the orders of the arbitral tribunal. In this context, the Court also observed that the Act does not contain any provisions for enforcement of an emergency/ interim award issued in a foreign seated arbitration, and therefore, an emergency award was unenforceable in India. Therefore, an application under section 9 is probably the only recourse left for the parties to seek interim measures of protection in India, for foreign seated arbitrations.
This article does not intend to hurt the sentiments of any individual, community, sect, or religion, etcetera. This article is based purely on the author’s personal opinion and views in the exercise of the Fundamental Rights guaranteed under Article 19(1)(A) and other related laws being enforced in India for the time being.