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Enforcement of Foreign Judgement and Foreign Arbitral Awards in India

Enforcement of Foreign Judgement and Foreign Arbitral Awards in India

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Foreign Judgement
Section 2(b) of the Civil Procedure Code 1908,defines ‘foreign judement’ to mean “any judgementof a foreign Court” Section 2(5) of the code definesa ‘foreign court’ to mean a “Court outside India andnot established or continued by the authority of theCentral Government”. Thus, “a foreign judgementwould mean adjudication by a foreign court uponthe matter before it” and not merely a statement of the reasons for the order.
[Brijlal V/s Govind AIR1947 PC 192].
A judgement given by a foreign court would not ceaseto be so if, as a consequence of political change, theterritory where the court was situated at the time of the judgement later becomes part of India. However,an act of state is not a foreign judgment
[SrimanV/s Goswami, ILR 17 Bom 620]Foreign Awards
The decision of the Arbitration follows in the formof an award.Section 44 (New York Convention Awards) of theArbitration and Conciliation Act, 1996 defines“foreign award” means an arbitral award ondifferences between persons arising out of legalrelationships, whether contractual or not, consideredas commercial under the law in force in India, madeon or after the 11
th
day of October, 1960 –a)in pursuance of an agreement in writing for
Enforcement of Foreign Judgement and Foreign Arbitral Awards in India
Vijay Kumar Dungarwal
Ph.D. Research Scholar, MLSU,Udaipur 
Abstract
India today is very much important part of the global economy. The ever-increasing level of globalization has ledto raise, international business disputes too. In this contest, the enforcement of foreign judgement and foreignArbitral Awards becomes significant. The law relating to enforcement of foreign judgement and awards has beendiscussed in the present paper. A foreign judgement may be enforced in India by (i) proceedings in execution and(ii) by a suit upon it, CPC, 1908. The enforcement of foreign arbitration awards is governed by the Arbitrationand Conciliation Act, 1996 through New York Convention and Geneva Convention and an Non-conventionalaward will be enforceable in India under the common law grounds of justice, equity and good conscience.arbitration to which the convention set forth inthe First Schedule applies and,b)in one of such territories as the CentralGovernment, being satisfied that reciprocalprovisions have been made may, by notificationin the official Gazette, declare to be territoriesto which the said convention applies.Section 53 (Geneva Convention Awards) of Arbitration and Conciliation Act, 1996, defines‘foreign awards’ means an arbitral award ondifferences relating to matters considered ascommercial under the law in force in India made afterthe 28
th
day of July, 1924 –a)in pursuance of an agreement for arbitration towhich the protocol set forth in the secondschedule applies, andb)between persons of whom one is subject to the jurisdiction of some one of such powers as theCentral Government,. Being more of the sixexceptions laid down in Section 13 of the CPC1908.
[Vishwanath V/s Abdual Wajid, Air 1963SC I]
Competent Jurisdiction of the Foreign Court
The foreign court passing the judgement must becompetent to ‘trial’ the suit. It is well establishedthat the following circumstances would give jurisdiction to the foreign courts.
[Moloji V/sShankar AIR 1962 SC 1737] :-
-Where the person is a subject of the foreign
 Article
 
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country, in which the judgement has beenobtained against him on prior occasions ;-Where he is a resident in the foreign countrywhen the process was served on him ,-He is temporarily present in the foreign, countrywhen the process was served on him,-Where he in his character as plaintiff in theforeign actions selects the foreign court as theforum for taking action in the capacity of plaintiff, in which forum he is sued later,-Where by an agreement a person has contractedto submit himself to the forum in which the judgement is obtained.As laid down by the Supreme Court of India in
Vellachi Achi V/s Ramanathan, AIR 1973 M 141
,that, generally the courts of a country, impose a three– fold restriction on the exercise of their jurisdiction :-jurisdiction in rem (binding not only the partiesbut the world at large) by a court over res outsidethe jurisdiction will not be exercised, because itwill not be recognised by other courts.-The court will not deal directly or indirectly withtide to immovable property outside the jurisdiction of the state from which it derives itsauthority and-The court will not assist in the enforcementwithin its jurisdiction of foreign penal or revenuelaws.
Mode of Enforcement of a Foreign Judgement
If the conditions set out in section 13 of the CPC,1908 are fulfilled, a foreign judgement may bebrought before a court in India for enforcement.However, it is not to be supposed that Indian Courtsare bound in all cases to take cognizance of the suitand they may refuse to entertain it on grounds of expediency.A foreign judgement may be enforced in India by (i): proceedings in execution and Section 44 and (ii) :by a suit upon it.The enforcement of a foreign judgement would bebased on the territory from where it emanates,whether it emanates from a reciprocating country ornon-reciprocating country. “Reciprocating Territory/ country” means any country or territory outside Indiaand so notified. The Central Government issuednotifications from time to time to recognizedcountries as reciprocating countries.When a suit emanates from any of the reciprocatingcountries, the concerned Indian Court will proceedforthwith to enforce the foreign judgement, providedit is not affected by any of the exceptions enumeratedin Section 13 of CPC, 1908.If it emanates from any other country i.e. a non-reciprocating Country’, the enforcement would haveto be sought by filing a suit in India on the foreign judgement. Again, the Indian Court would pass a judgement in terms of the foreign judgement providedit is not affected by the said exceptions.Section 14 of the CPC,1908 provides that the courtshall presume, upon production of any documentpurporting to be a certified copy of foreign judgementthat such judgement was pronounced by a Court of competent jurisdiction, unless the contrary appearson the record, that such presumption may bedisplaced by providing want of jurisdiction.The presumption under Section 14 of the CPC, 1908is obligatory on production of a certified copy. Itmay be displaced by evidence on the point.
[Vithalbhai V/s Lalbhai, AIR 1942 B 199]
and
[Mithalal V/s Kapoor, AIR 1959, Raj 47]
A decree(judgement) obtained on foreign judgementdoes not merge in the decree passed by an IndianCourt.
[Darbad V/s Narain, AIR 1944 L 302]Procedure for Execution of Foreign Judgement
A suit on the foreign judgement must be broughtwithin 3 years from the date of the judgement. Section101 of the Limitation Act, 1963. The pendency of an appeal in the foreign country will not bar a suiton a foreign judgement.A judgement of an Indian Court can only be enforced
 
120
by proceedings in execution, against that a foreign judgement may be enforced by proceedings inexecution in certain cases only. These are mentionedin Section 44 and 44 A of the CPC, 1908. In all othercases, a foreign judgement can only be enforced bya suit on the judgment. If such a suit is dismissed,no subsequent application to execute that judgementwill lie-for it has become merged in the decreedismissing the suit.This stand is brought out through the CPC, 1908distinguishing between foreign, judgements of countries which are ‘reciprocating territories’ andthose which are not.Section 44A of the CPC, 1908 reads that :-Where a certified copy of a decree of any of theSuperior Court of any reciprocating territory hasbeen field in a District Court (of India), thedecree may be executed in India as if it had beenpassed by the District Court.-Together with the certified copy of the decreeshall be filed a certificate from such SuperiorCourt stating the extent, if any, to which thedecree has been satisfied or adjusted and suchcertificate shall, for the purposes of proceedingsunder this Section be conclusive proof of theextent of such satisfaction or adjustment.‘Decree’ for this purpose means a decree or judgement under which a sum of money ispayable, not being a sum payable in respect of taxes or other charges of like nature or in respectof a fine or other penalty, but shall in no caseinclude an arbitration award, even if such anaward is enforceable as a decree or judgement.
Enforcement of Foreign Arbital Awards in India
The Act of 1996 was aimed to achieve two goals.First, to unify the legal regime surroundingarbitration for both domestic and internationalarbitration conduct in India. Second, to improvearbitral efficiency by reducing the need for judicialintervention, enforcing awards as judicial decrees,and granting greater autonomy to arbitral tribunaldecisions.
Statutory Framework for Convention Award
Part-II of the Act of 1996 which lays down statutoryframework for the enforcement of foreign arbitralawards given in the countries which are signatoriesto either the 1927 Convention on the Execution of Foreign Arbitral Awards [Geneva Convention] or the1958 convention on the Recognition and Enforcementof Foreign Arbitral Awards [New York Convention]
Pre-Enforcement Conditions
India has, however, made two reservations whilerectifying the convention, namely –A)that it would apply the convention to therecognition and enforcement of an award only if it was made in the territory of anotherreciprocating contracting state, andB)that is would apply the convention only todifferences arising out of legal relationshipswhich are considered as commercial under IndianLaw [Section 2(1) f]In the case of 
“Brace Transport Corporation of Monrovia Orient Middle East Line Ltd. [(1995supp 2 SC C 280]
Supreme Court has accepted that enforcementproceedings can be brought wherever the propertyof the losing party may be situated.
Application for Enforcement
A party applying for enforcement of a foreign awardis required to produce before the court :- [Section47 for New York convention and Section 56 forGeneva convention]-Original award or copy thereof, dulyauthenticated in the manner required by the Lawof the country in which it was made-Original agreement for arbitration or a dulycertified copy thereof,-Such evidence as may be necessary to prove thatthe award is a foreign award..-Translations, into English certified as correct insuch other manner as may be sufficient accordingto the law in force in India, where the award isin a foreign language.

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