NOY VALLESINA ENGINEERING SPA V JINDAL DRUGS LTD & ORS.

(2021)1SCC382
CASE-BRIEF
 Jindal Drugs entered into a contract with the petitioners to set up a plant in India. The
contract had an “Arbitration clause” designating London to be the seat of Arbitration.
 Thereafter, as disputes arose, arbitration proceedings were initiated under the auspices of
International court of Arbitration in Paris which ultimately gave the Arbitral award in
favour of the petitioners.
 Aggrieved with this, the same was challenged before the High Court in Bombay under
Section 34 of the A&C Act which held that a foreign award cannot be challenged under
section 34 but ultimately reversed their decision and gave an order in favour of the
respondents through an appeal to a higher bench.
 The reason for their finding was based upon two grounds:
1. That, the contract stated that Indian law will apply. Therefore the seat of
Arbitration was intended to be in India.
2. That, even if the seat was in London, the law established as under the BALCO
case came after the dispute had already arisen between the parties and therefore is
immune by the non-application of retrospective effect of the said judgment.
 When the case reached the supreme court , it over-turned the decision of the high court
on the following reasoning:
1. That , identical conditions in each contract, in the present case were referred to ,
which expressly stated that arbitration would be “under the Rules of Conciliation and
arbitration of the International Chamber of Commerce, Paris and Arbitration
proceedings shall be in the English language and shall take place in London.” This
made sure that the intended seat of arbitration is in London. Therefore, an appeal does
not lie under section 34 of the A&C Act in Indian courts.
2. That, Secondly, the proposition of foreign awards in enforcement not being
appealable in Indian Courts does not pre-emptively originates from the BALCO case
but existed before it as well, only specifically substantiated and applied in the
BALCO case. Therefore, the question of retrospective effect of law does not arise.