SOVEREIGN IMMUNITY (All the cases mentioned herein are listed in the case

folder)

RECOGNITION OF PRINCIPLE OF SOVEREIGN IMMUNITY THROUGH CASE

LAWS
The Hon’ble Supreme Court of India interpreted this principle through various case laws. In one such
case of Mirza Ali Akbar Kashani v. United Arab Republic1, the court interpreted that the concerned
section prescribes limited liability on foreign states to be sued. The limitation is two-fold, in sense that the
first limitation requires the consent from the Central Government which should be accompanied with a
certificate from the Secretary to the particular Government. This points out to the intention of the law
makers who looked upon to save the foreign states from unjustified claims. The second limitation is
imposed by the sub-section (2) itself, clause (a) to (d); that the government needs to justify that the case
falls under any one of the category mentioned in the clauses.

Furthermore, the court went to explain the relationship between Section 84 and Section 86, which will be
dealt later by the researcher. And beyond the question of Section 86, the Hon’ble court interpreted the
object of envisaging provisions such as Section 84. The court stated that the object to validate law suit by
a foreign state is to enforce the private right vested with the head of the state or any other public officer in
his official capacity and this right must be distinct from the political right.

And that such a suit against the ruler of that foreign state is to be in the name of that state. This has been
stated in Section 87. Although, Section 86 refers to a ruler of foreign state, which has been recognized by
the central government, but comprehensive reading of Section 86 and 87 says that the name of the state is
to be used instead of the name of that ruler.

One may interpret ruler here means a monarch but in real sense, but the court interpreted that the head of
a Republic State also falls under the same category.

PROVISIONS INSCRIBED IN INDIAN LAW AND THEIR COHERENCE

1
AIR1966SC230, [1966]1SCR319
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Section 86 of the Code of Civil Procedure cannot be read in isolation. It has to be read comprehensively
with other provisions.

The Amendment Act, 1951has substituted former Sections 83 to 87 for Section 83 to 87B which have
been amended further with the 1977 amendment.

SECTION 832 contemplates as to when alien enemies may sue with the permission from the central
government, in the same manner as Indian citizens do. However, there are two important prerequisites3
for enforcement of this section-

Firstly, the alien enemy must be residing in India

Secondly, he had the permission of the Government of India to stay in the country.

These two conditions only apply to the Alien Enemy; the Alien Friend need not require any such
precondition to sue.

SECTION 844 grants power to a foreign state to sue in a competent court so as to enforce private right of
the ruler or of any public officer acting in public capacity. Such a right is distinctive from political to
territorial rested vested with that ruler.5

SECTION 856 provides for appointing of persons by the Government to prosecute or to defend on behalf
of the foreign rulers. Such appointment is conclusive and cannot be questioned.7

SECTION 868 grants privilege and sovereign immunity to the head of a foreign state, envoys and
ambassadors. The object of envisaging this section was to give effect to the Public International Law.
However, it is important to note that it is merely qualified privilege. This is because a suit can be brought
against such foreign ruler with the prior permission of the central Government despite of the sovereign

2
Manupatrafast.com, http://www.manupatrafast.com/ba/COMdispcom.aspx?nid=94&nactcompid=20219
3
A.K. Mukherji v. Prodip Ranjan Sarabadhikary, AIR1988Cal259
4
Manupatrafast.com, http://www.manupatrafast.com/ba/COMdispcom.aspx?nid=95&nactcompid=20218
5
Mirza Ali Akbar Kashani v. United Arab Republic, AIR1966SC230.
6
Manupatrafast.com, http://www.manupatrafast.com/ba/COMdispcom.aspx?nid=96&nactcompid=20217
7
N. I. Singh v. B. C. Singh, AIR 1961 Manipur 40
8
Manupatrafast.com, http://www.manupatrafast.com/ba/COMdispcom.aspx?nid=97&nactcompid=20216
 Page |3

immunity principle. And with the permission of the Central Government, it is not open to the foreign state
to rely on the same principle.9

SECTION 8710 provides for a clear and comprehensive understanding of Sections 84 and 86. It clarifies
that if a foreign ruler is sued, he should be sued in the name of the state. The purpose of Section 87 is to
save the foreign state from being harassed.

SECTION 87A11, has been added by the 1951 Amendment Act, and provides for the definitions of a
“foreign state and ruler”. By, foreign state, it says that it is any state outside India and must be recognised
by the Central Government and ruler is someone who has been recognised as the head of that state for the
time being. Herein, the ruler does not only relate with head of a monarchical state but also includes other
forms of government.12

SECTION 87B13, has been added by the 1951 Amendment Act, lays down the difference between rulers
of the foreign states and of former Indian States.

Thence, it is evident that Section 84 confers powers on the foreign states to sue while Section 86 imposes
a qualified immunity on the foreign states. Such a suit can be brought against that foreign state with the
permission of the Central Government. However, in both cases, the name of the state will be used instead
of the ruler of the state.14

The Central Government may give the consent if,

 The foreign state has brought a suit in Court against the person whom it desires to sue
 The State trades within jurisdiction or the legal limits of that court
 It is in possession of an immovable property which is situated in the legal limits
 If that state has waived off the rights of sovereign immunity.15

9
Manzoor Mumtaz v. Saudi Arabian Airlines Corporation, AIR2002Delhi103
10
Manupatrafast.com, http://www.manupatrafast.com/ba/COMdispcom.aspx?nid=98&nactcompid=20215
11
Manupatrafast.com, http://www.manupatrafast.com/ba/COMdispcom.aspx?nid=99&nactcompid=20214
12
Id. 10
13
Manupatrafast.com, http://www.manupatrafast.com/ba/COMdispcom.aspx?nid=100&nactcompid=20213
14
Id. 13
15
Ethiopian Airlines v. Ganesh Narain Saboo, AIR2011SC3495
 Page |4

EXCEPTIONS TO SOVEREIGN IMMUNITY

There are two major exceptions to the sovereign immunity principle in India-

 Specific laws
 Commercial activities by corporate aggregate or corporate sole.

The first exception concerns about the specific laws. The Courts have interpreted that the specific laws
prevail over the general law which include the Code of Civil Procedure also. This is because the
legislatures have intended to exclude the older and general laws with recent and specific ones. This view
was also taken by the Hon’ble Supreme Court of India in the case of Ethiopian Airlines v. Ganesh Narain
Saboo16. The facts of the case are such that the respondent had booked a consignment with the Appellant
and later, due to gross delay, the goods had deteriorated. The Supreme Court took the view that when
there is a repugnancy between two special statutes; the non obstante clause of the later on prevails. And
by virtue of this, the Consumer Protection Act, 1986 and the Carriage by Air Act, 1972 prevail over the
Code of Civil Procedure.

Furthermore, the court also held that the Ethiopian Airlines was not entitled to sovereignty by the reason
of Commercial Transaction between the parties.

This takes us to the second Exception to Sovereign Immunity, which says that the parties need not take
the Consent of the Central Government and the certificate and the suit will be maintainable even then.17
This view was taken up by the majority in case of Kenya Airways, a Company registered under Law
regulating companies in Kenya v. Jinibhai B. Kheshwala18. Besides, the Court also opined that the
instrumentality will be considered as an agency of the State in spite of the commercial transactions, if it is
fully owned and controlled by the Government. However, the court did not grant immunity to the Kenya

16
AIR2011SC3495
17
Id. 23
18
AIR1998Bom287
 Page |5

Airlines because they have voluntarily waived off their right under Section 86 of the Code of Civil
Procedure. The Kenya Airlines had submitted themselves to the jurisdiction of the Court and did not raise
this plea for a period of 16 years, hence they were deemed to have waived their right of sovereign
immunity.

Furthermore, the initial onus is upon the corporation to establish that it has right to immunity and once
proved, the onus shifts on the other party to disprove the claim.19

WHEN IS CONSENT REQUIRED/ NOT REQUIRED

The interpretation of these sections has evolved through a number of judgments by the Hon’ble Supreme
Court of India. Although, Section 86 takes note of four circumstances when the consent may be obtained
and when not, but the Supreme Court of India have widened the interpretation through the following
judgments.

In Kenya Airways20 case, as has been discussed previously, the said company was held to be immune by
the doctrine in spite of being involved into commercial activities. However, due to their waiving off this
immunity, they were barred from the immunity under Section 86 and hence no prior consent was required
from the Central Government.

In the case of Harbhajan Singh Dhalla v. Union of India21, the court opined that the Government need to
exercise the power to grant consent with due care and must not be based on whimsical grounds or
arbitrarily. With due reference to the facts of the case, the then Government denied to sue the State of
Algeria merely on the political grounds. The Court strictly affirmed that an opportunity of being heard
should be given before passing the order of denial to sue the foreign state and as such be based on the
principles of natural justice.

In another case of Shanti Prasad Agarwalla v. Union of India & Ors.22, the Hon’ble Supreme Court of
India relied on the previous two judgments of Mirza Ali Akbar and Harbhajan Singh Dhalla, and said that
the government needs to accord to the principles of natural justice while disposing off the order and that

19
Royal Nepal Airline Corporation v. Monorama Mehar Singh Legha, AIR 1966 Cal 319
20
Kenya Airways, a company registered under law regulating Companies in Kenya v. Jinibhai B. Kheshwala,
AIR1998Bom287
21
AIR1987SC9
22
AIR1991SC814
 Page |6

the order must be a standing order. Further, if the administrative authorities are enjoined in deciding the
rights, then the authorities must accord to the fair and proper hearing to the person and the relevant
material factors must also be taken into consideration.

The Supreme Court, in the case of Veb Deutfracht Seereederei Rostock v. New Central jute Mills Co.
Ltd. & Anr23., discussed the purpose of Section 86. It stated that Section 86 is meant to give effect to the
International law. The principle talks about the absolute immunity but in India, it is qualified as the
foreign state can be sued with the permission of the Central Government. The Central Government then,
has to accede or refuse after looking upon the totality of the facts and circumstances. Here, it is important
to note that it is upon the discretion of the Central Government to grant consent or not. The Central
Government must justify itself that initiation of such suit would not be frivolous or to harass.

In case of Ethiopian Airlines v. Ganesh Narain Saboo24, the Court stated that the Specific Laws prevail
over the general ones because with time, the specific laws are enacted with the intention to do so. The
specific statutes are more focused and recent. Also, as in the modern era of trade and commerce, the
countries are to be subjected to the peculiar rules governing such activities. And when there are two
special statutes repugnant to each other, the non obstante clause of the later one prevails by the virtue of
being a recent law.

23
AIR1994SC516
24
Id. 24