Enforcement Of An Arbitral Award Should Be As Per §42 Of The Arbitration And Conciliation Act 1996: (India Media Services Pvt Ltd v SBPL Infrastructure Ltd)

The Telangana High Court has held that the enforcement of an arbitral award should be as per §42 of the Arbitration and Conciliation Act 1996, which provides that when any application is made before a court in relation to an arbitration agreement, then that court alone will have jurisdiction over the arbitral proceedings and all subsequent applications.

Facts

Disputes arose between the Petitioner and the Respondent in relation to a Nomination Agreement. The dispute was referred to arbitration. Applications under §9 [interim measures], §11 [appointment of arbitrator] and §34 [setting aside the arbitral award] of the Act were filed by the parties before the Calcutta High Court. The award was eventually passed in favour of the Respondent. As the property that was the subject of the dispute was situated in Hyderabad, the Respondent approached the City Civil Court, Hyderabad to enforce the award. The Petitioner preferred a revision petition before the Telangana High Court objecting to the jurisdiction of the City Civil Court, Hyderabad.

Decision

The Telangana High Court allowed the revision petition and held:

1. An enforcement application must be filed before the Court where the earlier applications were filed. As these were filed before the Calcutta High Court, that Court would have jurisdiction to entertain the enforcement application.
2. The Court adopted the view of the Supreme Court in State of West Bengal v Associated Contractors¹ which said that all applications made under Part I of the Act, before, during or after the arbitral award fall within the ambit of §42.
3. The Court distinguished two leading judgments of the Supreme Court: Sundaram Finance Ltd v Abdul Samad & Ors² and Cheran Properties Ltd v Kasturi Sons Ltd & Ors³ which say that an arbitral award can be enforced anywhere in India as if it is a decree of a civil court.

Conclusion

The enforcement of an arbitral award lies before the court to which the parties have already submitted to the jurisdiction in relation to the arbitration.

Footnotes

1 (2015) 1 SCC 32

2 (2018) 3 SCC 622

3 (2018) 16 SCC 413

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