Emmanuel Cashew Industries vs Chi Commodities Handlers Inc on 29 April, 2011

Kerala High Court

Emmanuel Cashew Industries vs Chi Commodities Handlers Inc on 29 April, 2011

IN THE HIGH COURT OF KERALA AT ERNAKULAM

PRESENT:

THE HONOURABLE MR. JUSTICE SHAJI P.CHALY

FRIDAY,THE 17TH DAY OF FEBRUARY 2017/28TH MAGHA, 1938

WP(C).No. 36054 of 2016 (F)

----------------------------

PETITIONER:
--------------------

EMMANUEL CASHEW INDUSTRIES,

CHEPRA P.O, KOTTARAKARA,
KOLLAM-691 520,
BY ITS PROPRIETOR JAMESON ABRAHAM.

BY ADVS.SRI.RAJIV ABRAHAM GEORGE

SRI.EAPEN ABRAHAM GEORGE

RESPONDENT :
------------------------

CHI COMMODITIES HANDLERS INC.,

3950, 14TH AVENUE, SUITE NO.504,
MARKHAM, ONTARIO,
CANADA REPRESENTED BY S.ANILKUMAR.

BY ADV. SRI.T.R.ASWAS

THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD

ON 31-01-2017, ALONG WITH WPC.NO. 36055/2016, THE COURT
ON 17-02-2017 DELIVERED THE FOLLOWING:

sts

WP(C).No. 36054 of 2016 (F)

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 Emmanuel Cashew Industries vs Chi Commodities Handlers Inc on 29 April, 2011

------------------------------------------

APPENDIX

PETITIONER(S)' EXHIBITS
----------------------------------------

EXHIBIT P1 TRUE COPY OF CONTRACT BEARING NO.BNA/73/ECI/CC/2011

DATED 29/4/2011.

EXHIBIT P2 TRUE COPY OF CONTRACT BEARING NO.BNA/92/ECI/CC/2011

DATED 6/5/2011

EXHIBIT P3 TRUE COPY OF CONTRACT BEARING NO.BNA/110/ECI/CC/2011

DATED 20/5/2011

EXHIBIT P4 COLLECTIVELY TRUE COPIES OF LETTER DATED 7/12/2011 ALONG

WITH NOTICE OF ARBITRATION DATED 7/12/2011 FROM ASSOCIATION
OF FOOD INDUSTRIES INC. TO THE PETITIONER.

EXHIBIT P5 TRUE COPY OF ARBITRATION RULES OF THE ASSOCIATION OF FOOD

INDUSTRIES INC.

EXHIBIT P6 TRUE COPY OF LETTER DTD 23/12/2011 SENT BY THE PETITIONER TO

THE PRESIDENT, ASSOCIATION OF FOOD INDUSTRIES INC.

EXHIBIT P7 TRUE COPY OF DEFENCE VERSION DTD 20/1/2012 FILED BY THE

PETITIONER BEFORE THE ASSOCIATION OF FOOD INDUSTRIES INC.

EXHIBIT P8 TRUE COPY OF AWARD DTD 7/2/2012 PASSED BY THE ARBITRAL

TRIBUNAL

EXHIBIT P9 TRUE COPY OF ORDER DTD 12/3/2015 IN (ARB) OP NO.130 OF 2012 OF

THE III ADDITIONAL DISTRICT JUDGE, KOLLAM.

EXHIBIT P10 TRUE COPY OF AWARD DTD 29/2/2012 PASSED BY THE ARBITRAL
TRIBUNAL

EXHIBIT P11 TRUE COPY OF OBJECTIONS TO E.P NO.131/2013 FILED BY THE

RESPONDENT HEREIN AS AWARD HOLDER.

EXHIBIT P12 TRUE COPY OF OBJECTIONS TO E.P.NO. 131 OF 2013 FILED BY THE
PETITIONER HEREIN

EXHIBIT P13 TRUE COPY OF EA NO.69 OF 2016 DTD 15/6/2016 IN EP NO.131/2013

FILED BY THE PETITIONER HEREIN.

EXHIBIT P14 TRUE COPY OF ADDITIONAL OBJECTION/REJOINDER DTD 15/6/2015

FILED BY THE PETITIONER.

EXHIBIT P15 TRUE COPY OF BRIEF ARGUMENT NOTES DTD 8/9/2016 FILED BY
ADVOCATE FOR PETITIONER.

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 Emmanuel Cashew Industries vs Chi Commodities Handlers Inc on 29 April, 2011

2/-

-2-

WP(C).NO.36054/2016

EXHIBIT P16 TRUE COPY OF ORDER DTD 4/10/2016 IN EA NO.69 OF 2016 IN

EP NO.131/2013 OF THE III ADDITIONAL DISTRICT JUDGE, KOLLAM.

EXHIBIT P17 TRUE COPY OF PETITION TO ACCEPT STATEMENT OF ACCOUNT DTD

27/10/2016 FILED BY THE RESPONDENT HEREIN.

EXHIBIT P18 TRUE COPY OF PETITION DTD 27/10/2016 TO ARREST THE

PETITIONER HEREIN FILED BY THE RESPONDENT HEREIN.

RESPONDENT(S)' EXHIBITS
-------------------------------------------

EXHIBIT R1-AWARD # 2561 (A) DATED 07/02/2012 PASSED AGAINST THE PETITIONER
BY AFI.

EXHIBIT R2-2015 (4) KLT 582-REPORTED HIGH COURT JUDGMENT AGAINST

PETITIONER.

EXHIBIT R3-ORDER DATED 29/07/2016 DISMISSING SLP PREFERRED BY PETITIONER

AGAINST EXT.R2

EXHIBIT R4-GENERAL DIRECTIONS ISSUED BY HIGH COURT IN 2015 (3) KLJ 664.

EXHIBIT R5-JUDGMENT DATED 03/06/16 PASSED AGAINST PETITIONER IN OP(C).

NO.342/2016.

EXHIBIT R6-ORDER DATED 15/07/2016 DISMISSING SLP PREFERRED BY PETITIONER

AGAINST EXT.R5

/TRUE COPY/

P.S.TO JUDGE

sts

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C.R.
SHAJI P. CHALY, J.
--------------------------------------------------
W.P.(C) Nos.36054 & 36055 of 2016
-----------------------------------------------
Dated this the 17th day of February, 2017

JUDGMENT

The captioned writ petitions are filed challenging the order of the III Addl. District Judge, Kollam
dated 04.10.2016 in E.A.No.69 of 2016 in E.P.No.131 of 2013 and E.A.No.68 of 2016 in E.P.No.129
of 2013 respectively, filed by the petitioners in the writ petitions. The subject matter of the writ
petitions are offshoot of execution proceedings of Foreign Arbitration Awards filed under Sec.49 of
the Arbitration and Conciliation Act, 1996 [for short, 'Act, 1996']. The execution applications are
filed by the judgment debtor under Order XVI, Rule 10 read with Sec.151 of the Code of Civil
Procedure, and Rules 3 and 11 of the Kerala Arbitration and Conciliation (Court) Rules, 1997,
seeking direction to the Association of Food Industries Inc., USA to produce the entire file relating
to the final award dated 07.02.2012 in Arbitration Index #2561 and 2562 respectively, to furnish
proof in contemplation of Sec.48 of Act, 1996.

W.P.(C) Nos.36054 & 36055 of 2016 2

2. The registry of this Court has noted a defect that the challenge is not maintainable under Article
226 of the Constitution of India. However, the petitioners sought the matters to be placed before the
Court, on the basis of the judgment of the Apex Court in 'M.S. Kazi v. Muslim Education Society and
others' [2016 (9) SCC 263]. When the matter was so placed, it was informed by learned counsel
appearing for the petitioners that an arrest warrant was issued against the petitioners without
issuing any notice and therefore, the subject matter is to be considered under Article 226 of the
Constitution of India. Therefore, I directed the registry to number the writ petitions and ordered
stay of operation of the arrest passed by the court below in the respective execution applications for
a short period, which was being extended periodically. Therefore, learned counsel for the
respondent sought to consider the said question as a preliminary point, especially stating that the
afore-quoted judgment has no bearing to the issue.

3. True, under normal circumstances, proceedings of this nature can only be challenged invoking
Article 227 of the Constitution of India, especially in view of the peculiar nature W.P.(C) Nos.36054
& 36055 of 2016 3 of the provisions of Part-II, Chapter I of the Arbitration and Conciliation Act,
1996. Anyhow, when it was brought to my notice that arrest warrant was issued without issuing
notice to the writ petitioners, in order to avoid any consequential action on the same, taking into
account the larger aspects of the rights and liberties conferred under Part-III of the Constitution of
India, I thought that the matter can be heard invoking the power under Article 226 of the
Constitution of India. Learned counsel for the petitioners has invited my attention to the judgment
of the Apex Court in 'Surya Dev Rai v. Ram Chander Rai and others' [AIR 2003 SC 3044], wherein a
similar question was considered. Paragraph 25 of the said judgment is relevant to the issue, which

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read thus:

"25. Upon a review of decided cases and a survey of the occasions wherein the High
Courts have exercised jurisdiction to command a writ of certiorari or to exercise
supervisory jurisdiction under Article 227 in the given facts and circumstances in a
variety of cases, it seems that the distinction between the two jurisdictions stands
almost obliterated in practice.

Probably, this is the reason why it has become customary with the lawyers labelling their petitions
as one common under Articles 226 and 227 of the Constitution, though such practice has been
deprecated in some judicial pronouncement. Without entering into niceties and technicality of the
subject, we venture to state the broad general difference between the two jurisdictions. First, the
writ of certiorari is an exercise of its original jurisdiction by the High Court; exercise of supervisory
jurisdiction is not an original jurisdiction W.P.(C) Nos.36054 & 36055 of 2016 4 and in this sense it
is akin to appellate revisional or corrective jurisdiction. Secondly, in a writ of certiorari, the record of
the proceedings having been certified and sent up by the inferior court or tribunal to the High Court,
the High Court if inclined to exercise its jurisdiction, may simply annul or quash the proceedings
and then do no more. In exercise of supervisory jurisdiction the High Court may not only quash or
set aside the impugned proceedings, judgment or order but it may also make such directions as the
facts and circumstances of the case may warrant, may be by way of guiding the inferior court or
tribunal as to the manner in which it would now proceed further or afresh as commended to or
guided by the High Court. In appropriate cases the High Court, while exercising supervisory
jurisdiction, may substitute such a decision of its own in place of the impugned decision, as the
inferior court or tribunal should have made. Lastly, the jurisdiction under Article 226 of the
Constitution is capable of being exercised on a prayer made by or on behalf of the party aggrieved;
the supervisory jurisdiction is capable of being exercised suo motu as well."

4. Taking into account the principles of law laid down by the Apex Court and the foundational aspect
that led me to entertain the matters under Article 226 of the Constitution of India, I am of the
considered opinion that petitioners need not be non-suited on that ground. Therefore, I proceed to
consider the subject matter of the issue on merits. Material facts for the disposal of the writ petitions
are as follows:

5. Petitioners in the writ petitions have entered into various contracts with M/s. Bright & Associates
for export of cashew kernel of various grades by the petitioners to the W.P.(C) Nos.36054 & 36055
of 2016 5 respondent. Petitioners received letter dated 07.12.2011 from Association of Food
Industries Inc., USA, along with demands for arbitration in respect of certain disputes arisen. On
23.12.2011, petitioners requested Association of Food Industries Inc. to furnish copy of the
statements of claims and demands filed before it to enable the petitioners to file an effective reply.
On 20.01.2012, even though the claims and demands were not furnished, submitted defence
statement to Association of Food Industries Inc. Thereafter, according to the petitioners, there was
no intimation. However, on 07.02.2012, award signed and executed before a Notary Public of the
State of New York by the Arbitral Tribunal published bearing Index 2561 and 2562 were received by
the petitioners on 31.03.2012.

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6. Aggrieved by the award dated 07.02.2012, petitioners filed O.P.(Arbitration) No.130 of 2012 and
O.P. (Arbitration) No.87 of 2012 on 09.04.2012 and 05.03.2012 respectively, before the District
Court, Kollam, raising serious grounds including fraud and forgery. Respondent filed E.P.No.131 of
2013 and E.P.No.129 of 2013 on 30.03.2013 and 22.03.2013 respectively. According to the
petitioners, W.P.(C) Nos.36054 & 36055 of 2016 6 later petitioners received copy of award dated
29.02.2012 with same index numbers, which were exactly similar in all respects of the award dated
07.02.2012, dealing with the same disputes except the signature of the same arbitrators which were
glaringly different. Petitioners have filed detailed objections to the Execution Petitions.

7. While so, the respondent herein filed preliminary objections to O.P.(Arb.) No.130 of 2012 and
O.P.(Arb.) No.87 of 2012 filed under Sec.34 of the Arbitration Act, challenging the maintainability of
the Original Petitions. On 12.03.2015, the III Addl. District Judge, Kollam, after considering the
preliminary objection, ordered that the Original Petitions cannot be thrown away at the threshold
without an enquiry, and that the question of maintainability requires evidence. Aggrieved by the
same, respondent preferred Original Petition (C) Nos.903 and 904 of 2015 and Original Petition (C)
No.821 of 2015, and this Court set aside the order dated 12.03.2015 of the District Court. It is
revealed from the records that petitioners have taken up the said issue before the Apex Court by
filing Special Leave Petitions, which are dismissed. Accordingly, the Original Petitions filed by the
petitioners W.P.(C) Nos.36054 & 36055 of 2016 7 challenging the arbitration award under Sec.34 of
the Arbitration and Conciliation Act, 1996 ended up in dismissal.

8. On 15.06.2016, E.A.No.69 of 2016 in E.P.No.131 of 2013 and E.A.No.68 of 2016 in E.P.No.129 of

2013 were filed by the petitioners praying to call for the records leading to the award dated
07.02.2012, from the Association of Food Industries Inc. On the same day, additional
objections/Rejoinder also were filed by the petitioners to the reply affidavit dated 10.04.2014 filed
by the respondent. On 31.08.2016, E.A.Nos.69 and 68 of 2016 were heard by the court below. On
04.10.2016, the Execution Applications were dismissed by the court below, holding that the said
applications are not maintainable as per the provisions of Sec.48 of the Arbitration and Conciliation
Act, 1996.

9. According to the petitioners, on 27.10.2016, petitions to accept Statement of Account and for
arrest of petitioners/judgment debtors served on the counsel for the petitioners and filed by the
respondent in the court below on 28.10.2016. It is the contention of the petitioners that, on
31.10.2016, an arrest warrant was issued to arrest the petitioners even without issuing notice to the
petitioners, while W.P.(C) Nos.36054 & 36055 of 2016 8 notice on the petition to accept Statement
of Account issued to the petitioners and matter posted to 08.11.2016.

10. Pausing here for a moment, it was the said issue pointed out by the learned counsel for the
petitioners compelled the petitioners to file the writ petitions under Article 226 of the Constitution
of India. It is thus aggrieved by the orders passed by the court below in E.A.Nos.69 and 68 of 2016
dated 04.10.2016, these writ petitions are filed.

11. Separate detailed counter affidavits are filed by the respondent in both the writ petitions,
refuting the allegations and claims and demands raised by the petitioners. According to the

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respondent, petitioners did not produce the judgments in the Original Petitions passed by this Court
in the challenge made by the respondent against the award under Sec.34 of the Act, 1996. It is also
contended that, petitioners have failed to produce the judgment of this Court in O.P.(C) Nos.341 and
342 of 2016 rendered in the context of a Transfer Petition, in order to suppress the findings
rendered thereunder with respect to the delay willfully caused by the petitioners. Other contentions
are also raised traversing through Sections 47, 48 and 49 of Act, 1996. Therefore, the respondent
seeks W.P.(C) Nos.36054 & 36055 of 2016 9 dismissal of the writ petitions.

12. Heard learned counsel for the petitioners and the learned counsel appearing for the respondent.
Perused the documents on record and the pleadings put forth by the respective parties.

13. The subject matter of the issues, discussed above, are confined to Sections 47 to 49 of Act, 1996.
Sec.47 of the Act deals with the production of evidence by a party applying for enforcement of a
foreign award at the time of application. Sec.47 stipulates production of the original award or a copy
thereof, duly authenticated in the manner required by the law of the country in which it was made;
the original agreement for arbitration or a duly certified copy thereof, and such evidence as may be
necessary to prove that the award is a foreign award. Other conditions are stipulated in sub-section
(2) of Sec.47, dealing with the translation if the foreign award is rendered in a foreign language. The
Explanation thereto, as it stood originally, stipulates that, when the award was submitted for
execution, the court in Sec.47 means the Principal Civil Court of original jurisdiction in a district,
and includes the High Court in exercise of its original civil W.P.(C) Nos.36054 & 36055 of 2016 10
jurisdiction. However, the Explanation is later amended with effect from 23.10.2015, which is not
having a bearing to the fact scenario of these cases. Petitioners have no case that respondent has not
complied the stipulations and parameters provided under Sec.47 of the Act, 1996.

14. Sec.48 deals with the conditions for enforcement of foreign awards, which may be refused by the
court, at the request of the party against whom it is invoked, only if that party furnishes to the court,
proof that the parties to the agreement referred to in Sec.44, were under the law applicable to them,
under some incapacity, or the said agreement is not valid under the law to which the parties are
subjected it or, failing which, any indication thereon, under the law of the country where the award
was made; or the party against whom the award is invoked was not given proper notice of the
appointment of the arbitrator or of the arbitral proceedings; or was otherwise unable to present his
case, etc. etc. It was based on Sec.48 of Act, 1996, petitioners have filed E.A.Nos.69 and 68 of 2016
respectively, to call for the records in order to oppose the enforcement. According to the learned
counsel for the petitioners, Sec.48 of Act, 1996 enables the W.P.(C) Nos.36054 & 36055 of 2016 11
petitioners to seek for production of records by issuing appropriate direction by the execution court
in order to establish non-enforceability of a foreign award. The foundational contention of the
counsel for the petitioners is that, in order to establish proof as contemplated under Sec.48 of Act,
1996, the execution applications were filed, and as of right, the petitioners are entitle to do so, and
therefore, the dismissal of the applications by the court below were not correct.

15. On the other hand, learned counsel for the respondent submitted that, on a reading of Sec.48, it
is clear, petitioners ought to have furnished to the court proof to establish the contentions raised. It
is also submitted that evidence and proof, are different in the legal context. When the section makes

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 Emmanuel Cashew Industries vs Chi Commodities Handlers Inc on 29 April, 2011

an imperative condition of furnishing proof, petitioners are not entitled to call for evidence in order
to establish proof. Learned counsel for the respondent has also invited my attention to the following
judgments of various High Courts:

1. 'Alcatel India Limited & Anr. v. Koshika Telecom Limited & Ors. [2004 (3) Arb. LR 107 (Delhi)]
W.P.(C) Nos.36054 & 36055 of 2016 12

2. 'Sial Bioenergie, Decree Holder v. Sbec Systems, Judgment Debtors' [AIR 2005 DELHI 95]

3. 'Compania Naviera Sodnoc SA v. Bharat Salt Refineries Ltd. and Anr.' [2008 (1) Arb. LR 344
(Madras)]

4. 'Glencore Grain Rotterdam B.V v. Shivnath Rai Harnarain India Co.' [LAWS (DLH) -
2008-11-189]

5. 'Jindal Exports Ltd. v. Fuerst Day Lawson Ltd.' [2010 (1) Arb. LR 1 (Delhi)]

6. 'Penn Racquet Sports v. Mayor International Ltd.' [2011 (1) Arb. LR 244 (Delhi)]

16. Taking note of the respective submissions made across the Bar, and reckoning the legal and
factual circumstances, I am of the considered opinion that the question to be decided in these cases
centers around 'proof' prescribed under Sec.48 of Act, 1996. On a reading of Sec.48, what could be
gathered is, in order to refuse enforcement of a foreign award, petitioners were duty bound to
furnish proof to establish that they were incapacitated in any manner envisaged under sub-section
(1)(a) to (e) of Sec.48. Petitioners have no case that they have produced any such proof before the
Court. The methodology adopted by the petitioners were to make an attempt to establish proof after
securing documents from the arbitrator.

W.P.(C) Nos.36054 & 36055 of 2016 13

17. In my considered opinion, under Sec.48 of Act, 1996, the Court is provided with the liberty to
refuse enforcement of a foreign award at the request of the party against whom it is invoked, only if
the party furnishes to the court proof with respect to the parameters provided thereunder. On a
reading of the said provision, what is significant is "furnishing proof" by the party objecting to the
enforcement of foreign award. The court is not duty bound to aid the petitioners to establish proof
by calling records from an arbitrator under Sec.48. Proof evinces high degree of evidence
established by the party to convince the court to rely on it to sustain the contentions raised in
accordance with the requirement of law in question. Under Sec.48, it is the duty of the petitioners to
introduce substantive, convincing and sufficient proof to satisfy the court to decide the enforcement
of the award, which thus also means, a legal duty is cast upon the petitioners to provide proof in
order to persuade the court to arrive at a definite conclusion the way law demands. Moreover,
surmises and conjunctures created to prejudice the mind of the court is neither evidence nor proof.
That apart, when proof is the requirement under law, it should be adduced W.P.(C) Nos.36054 &
36055 of 2016 14 in a clear, cogent and convincing manner. I am also of the view that, deliberate

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and clear expression of 'furnishing proof' is employed in Sec.48 to eliminate any action of
protracting the proceedings in order to have efficacy and finality to a foreign award with the
objective of ensuring that other countries recognize the provisions of Act, 1996. What is imperative
is 'furnishing proof', the burden of which never shifts from the objector to anyone at any point of
time. If it was 'proof' alone, provided under Sec.48, burden may shift in accordance with the facts
and circumstances of a case. But, under Sec.48 of Act, 1996, there is no such scope since the burden
is to 'furnish proof' by the objector. When law casts a particular manner of proof available at the
threshold of the proceedings to consider the objection, the rigor insisted upon law can never be
diluted or watered down. 'Furnishing of proof' also means 'production of proof'. Black's Law
dictionary (Ninth Edn.) defines 'burden of production' to mean "a party's duty to introduce enough
evidence on an issue to have the issue decided by the fact-finder, rather than decided against the
party in a peremptory ruling such as a summary judgment or a directed verdict". So also, 'burden of
proof' is defined to W.P.(C) Nos.36054 & 36055 of 2016 15 mean, 'a party's duty to prove a disputed
assertion or charge, which includes both the burden of persuasion and the burden of production'.
Therefore, filing of objections can never be termed as substitute for proof under Sec. 48 of Act, 1996.

18. In this context, it is relevant to deal with, the significance of the Arbitration and Conciliation Act,
1996. The Act was brought into force to consolidate and amend the law relating to domestic
arbitration, international commercial arbitration, and enforcement of foreign arbitral awards, as
also to define the law relating to conciliation and for matters connected therewith or incidental
thereto. The paramount relevance of Act, 1996 is ensuring finality to a dispute in a speedy manner.
It is bearing in mind the requirement of speedy disposal of claims, under Sec.48, a duty is cast upon
the judgment debtor to furnish proof to sustain consideration of objection against enforcement of
foreign awards. Any manner of laxity in that regard would defeat the intention of the Legislature.

19. Therefore, in my considered opinion, petitioners failed to furnish proof in order to establish the
objections raised by them. The provisions of the Act do not permit the W.P.(C) Nos.36054 & 36055
of 2016 16 petitioners to explore the possibility of creating proof through the process of court in an
enforcement proceedings of a foreign arbitration award. The contentions advanced by the
petitioners mainly were in respect of the initial proceedings that are undertaken by the respondent
for conducting the arbitration. Learned counsel for the petitioners was trying to impress upon me
various intricacies of the arbitration agreement entered into by and between the petitioners and the
respondent, to make an attempt to establish that calling for records is inevitable to consider the
objection as per the provisions of Sec.48. One of such contention is that in the purchase and sales
contract even though against Column, Arbitration AFI (Association of Food Industries, Inc.) is
mentioned as the arbitrator, there is no explanation to the nature and character of the same.
However, I find from the latter part of the said document that, any controversy, claim or breach
arising out of or relating to the contract, the same shall be settled in New York City by arbitration.
Therefore, the said contention advanced by learned counsel for the petitioner falls to the ground.

W.P.(C) Nos.36054 & 36055 of 2016 17

20. Yet another contention raised is that, the award is seen passed by the arbitrator on 07.02.2012
and executed before the Notary Public and it was received by the petitioners on 01.03.2012.

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However, the same was seen modified on 28.02.2012. According to the learned counsel for the
petitioners, before making any such modification, there was no notice issued to the petitioners. It is
also submitted, even though on 23.03.2011, petitioners requested the arbitrator to furnish copies of
the statements of claims and demands, the same were not provided to the petitioners. Learned
counsel has also invited my attention to the Civil Practice Law and Rules of New York, which deals
with the Rules to be followed by the arbitrators. The sum and substance of the contentions advanced
by the petitioners is that, the award was secured by the respondent by employing fraud on the
petitioners and therefore, the court below had a duty to call for the records. However, in my
considered opinion, these are all matters to be agitated by the petitioners by making a suitable
challenge against the awards in accordance with the law of the country where the arbitration was
conducted. Petitioners have not cared to do so. It is also evident from sub-clause (c) of Clause
W.P.(C) Nos.36054 & 36055 of 2016 18 7503 of Article 75 of New York Civil Practice Law and Rules,
if petitioners were not agreeable or had objection to proceed with the arbitration, they ought to have
made suitable objections to it before the court as provided under the Rules within 20 days after
service of a notice of intention to arbitrate. Having not done so, petitioners cannot turn around and
defend on those aspects as proof to object enforcement of the foreign award.

21. A short survey to the view expressed by the apex court in this regard, in its judgments, would be
worthwhile. Confirmation of the award under the U.S. law is not required before its execution in
India as held in 'Escorts Ltd. v. Universal Tractor Holding LLC' [(2013) 10 SCC 717]. So also, it is
held in 'Shri Lal Mahal Ltd. v. Progetto Granos PA' [(2014) 2 SCC 433], that Sec.48 does not permit
review of foreign awards on merit and there is no scope for a second look at the merits during the
course of enforcement of foreign award. Again, in 'Konkan Railway Corporation Ltd. and others v.
Mehul Construction Co.' [(2000) 7 SCC 201], held that:

W.P.(C) Nos.36054 & 36055 of 2016 19 "To attract the confidence of the international mercantile
community and the growing volume of India's trade and commercial relationship with the rest of the
world after the new liberalization policy of the Government, Indian Parliament was persuaded to
enact the Arbitration and Conciliation Act of 1996 on the UNCITRAL Model and, therefore, in
interpreting any provisions of the 1996 Act, courts must not ignore the objects and purpose of its
enactment. A bare comparison of different provisions of the Arbitration Act of 1940 with the
provisions of the Arbitration and Conciliation Act, 1996 would unequivocally indicate that the 1996
Act limits intervention of court with an arbitral process to the minimum and it is certainly not the
legislative intent that each and every order passed by an authority under the Act would be a subject-
matter of judicial scrutiny of a court of law.'

22. A strict interpretation to Sec.48 is a necessary corollary to maintain recognition to Indian law
among the comity of nations. Moreover, international trade relations are progressing day by day,
and the inevitable consequence is disputes and litigations. Therefore, speedy disposal of cases and
execution of awards without being saddled by procedure, is vital to sustain and develop trade
relations. The intention, extent and scope of Sec.48 cannot be frustrated, by resorting to an
unorthodox or casual approach.

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23. Upshot of the above discussion is, I do not find any reason to interfere with the order passed by
the court below in E.A.No.69 of 2016 in E.P.No.131 of 2013 and E.A.No.68 of 2016 in E.P.No.129 of
2013, dated 04.10.2016, especially due W.P.(C) Nos.36054 & 36055 of 2016 20 to the fact, I am
convinced, there is no illegality, arbitrariness, or any other legal infirmity warranting interference
under Article 226 of the Constitution of India. Therefore, the writ petitions fail, accordingly they are
dismissed.

24. At this point of time, it was pointed out by learned counsel for the respondent that orders are
passed under Sec.49 of Act, 1996 to the effect that the court is satisfied that the foreign award is
enforceable under Chapter II of Act, 1996, and the award shall be deemed to be a decree of that
court. The orders so passed are not subject matter of challenge in these writ petitions. So, I make it
clear that, I have not considered the said issue. Learned counsel for the petitioners also have a case
that even if the applications were rejected, still the petitioners are entitled to prove before the
execution court that they have produced sufficient proof objecting to the enforceability of the foreign
award. The said questions are all left open.

Sd/-

SHAJI P. CHALY JUDGE //true copy// P.S. to Judge St/-

07.02.2017

Indian Kanoon - http://indiankanoon.org/doc/99165871/ 11