FINALITY AND ENFORCEMENT OF ARBITRAL AWARDS1

Name – Mitrajsinh parmar

Roll no – 56

INTRODUCTION:
It comes as no surprise that there has been a great increase of international arbitrations being
heard in the Asia-Pacific region over the past few decades. This can in part be attributed to
developing and rapidly industrialising economies, particularly those in Asia, which in turn leads
to an increase in business opportunities, dealings and disputes that follow. Naturally, there is a
degree of competition between arbitral jurisdictions to attract international arbitration. A
failure to present as an attractive seat for arbitration by a country‘s legislature and courts can
have significant adverse consequences, not only for its international arbitration credentials, but
also in terms of the development of a jurisdiction‘s international legal expertise, and the
involvement of its legal and other professionals in international trade and commerce.
Two broad issues are discussed in this paper. First, the role of the courts generally with respect
to arbitration and the circumstances in which judicial intervention is necessary. Secondly,
focusing on one of the most controversial aspects of judicial intervention – when a court should
set aside or refuse enforcement of an international arbitral award. The focus of the discussion
of these issues is on recent significant decisions in the Asia-Pacific region in order to provide
something in the nature of an overall regional picture.

DISCUSSION:

1
Parmar Mitrajsinh, B.A.LL.B (HONS) IV, Roll No.56, PRN: 2016033800102561, Baroda School of Legal Studies, The
Maharaja Sayajirao University of Baroda.
The Arbitration Award
The below represents some of the topics frequently touched upon in discussions focusing on
the arbitration award as such. 

(a) Rules Applicable to the Substance of the Dispute 

The flexible approach offered by arbitration is reflected also in the parties freedom of contract
concerning the applicable substantive law. Consequently, the Model Law grants the parties full
autonomy in their choice of substantive law, and in providing that the arbitrators shall decide
the dispute in accordance with the law as chosen by the parties. If the parties have not chosen
an applicable substantive law, the arbitrators will make that decision when necessary. 
In an arbitration in Sweden, this means that where the parties have not agreed on which
conflict of laws rules that should be applied, the arbitrators may choose to apply Swedish rules
in this respect, even if they, under Swedish law, are not bound to do so. The arbitrators may
thus apply another conflict of laws system they deem appropriate in the particular case, or they
may decide the issue of applicable substantive law without having resort to any specific
national conflict of laws rules.
A basic choice of law principle in Sweden is that the law with the closest connection to the
contract shall be applied. For further reading cf. Kaj Hober, In Search for the Centre of Gravity –
Applicable Law in International Arbitrations in Sweden, Yearbook of the Arbitration Institute of
the Stockholm Chamber of Commerce, 1994.
 
(b) Form and Contents of the Award
Principal provisions relating to the form and content of the award are laid down in Article 31 of
the Model Law. The award shall, inter alia, be made in writing and shall be signed by the
arbitrator, or arbitrators. It might be noted that the article should be read so as to mean that an
award may not, in the absence of an agreement to the contrary between the parties, be signed
by, for example, the chairman of a tribunal “on behalf” of the other members.
The award shall state the reasons upon which it is based, unless the parties have agreed that no
reasons are to be given. In international practice, awards without reasons are not very
common, even if there are a number of examples of e.g. institutional arbitration rules which
specifically provide for the possibility of rendering an award without reasons .
 
An arbitration award will result in an order, setting out the practical conclusions of the findings
of the tribunal. This part of the award may include a declaration as to the rights of the parties, if
requested by the parties in their statements before the tribunal, or contain an order for
payment, for interest or for specific performance.

Arbitral Award- Enforcement [section 36]

Section 36 of the Arbitration and Conciliation Act, 1996 after the 2015 Amendment Act,
provides that when the time period that is provided for making an application in the court for
setting aside an arbitral award has expired the award of the arbitral tribunal will have an effect
of a decree of a court and shall be enforced in the same way. (As per the provisions of Code of
Civil Procedure of 1908).
If a party challenges the award of an arbitral tribunal (under section 34 of the Arbitration Act)
by filing an application for the same in the court, just because he has applied would not set
aside the arbitral award. The award will be set aside only when the court orders so.
The court may put a stay on the arbitral award if it is satisfied that the award is against the
principles of justice. The court shall record its reason for doing so.

The Finality of the Award

The first information which should be given to the unsuccessful party above is that the
arbitration award is final and binding on the parties. An arbitration award may not be appealed.
In a limited number of cases, however, an award may be set aside on procedural grounds. The
law of the seat of arbitration will usually provide the grounds and mechanisms for this
procedure.
According to the Model Law, an application to set aside an arbitration award, i.e. a challenge,
may be made only on any of the following grounds:
1) the arbitration agreement was invalid; or
2) the challenging party was unable to present his case; or
3) the arbitrators have made a decision over an issue falling outside the scope of the arbitration
agreement; or
4) the constitution of the arbitral tribunal did not comply with the parties arbitration
agreement.
Finality of arbitral awards.- Subject to this Part an arbitral award shall be final and binding on
the parties and persons claiming under them respectively.
CONCLUSION:
The Parliament has enacted the Arbitration and Conciliation Act with a view to provide speedy
remedy by arbitration and to achieve this objective, section 5 of the Act puts a complete bar on
the intervention of the courts in matters where there exists an arbitration clause. The law of
arbitration in India is very much at its crossroads. As things stand today, arbitration is poised to
effect great changes to the ways in which dispute resolution is conducted. It brings with it the
solemnity and finality of the judicial process and couples it with the procedural flexibilities of
non-conventional dispute resolution methods. There is, however, an equally pressing need to
recognize that much more can and should be done to improve the conduct of arbitral
proceedings in India but most importantly, we feel that there is a need to effect a change in
perceptions. At the end of the day arbitration would see the day light of reality and true success
when people would start accepting the arbitral award and its finality as that of a judgment by
the Supreme Court not because it is justice always but because it is final always, having no
further appeal.2345

2
https://viamediationcentre.org/readnews/NTQw/Arbitral-Award-Finality-Enforcement-and-the-effect-of-2015-
Amendment
3
http://www.legalservicesindia.com/article/433/Arbitral-Award-Its-Challenge-&-Enforcement.html
4
http://www.investkz.com/en/journals/30/284.html
5
https://arbitrationandconciliation.wordpress.com/chapter-viii-finality-and-enforcement-of-arbitral-awards/