- (1.) The preliminary objection raised by the respondent, a commercial arm of the Canadian government, as to the authority of any Indian court to receive a challenge to an arbitral award passed in a reference conducted beyond the territorial limits of this country, brings to the fore a vexed issue that appears to have been variously answered by courts in the country. For the purpose of the point of demurer it is only necessary to recognise some admitted facts. The parties entered into an agreement sometime in the year 1989 for the respondent to set up a coal extracting facility for the petitioner in the Rajmahal area in the state of Jharkhand. The parties are agreed that the agreement was to be governed by the laws in force in India; that the disputeresolution mechanism envisaged thereunder was of arbitration; and, that the arbitration was to take place under the rules of the International Chamber of Commerce (ICC) with the place of the arbitration in Geneva, Switzerland. Upon disputes arising between the parties as to whether the petitioner was entitled to more money by way of penalty than the respondent was to get bonus, the petitioner sought a reference. The parties nominated their representatives on the arbitral tribunal and the presiding arbitrator was filled in by the ICC. The arbitral tribunal held its meetings in the United Kingdom but recognised that the seat of the arbitration was Switzerland. It is not necessary at this juncture to either look at the merits of the disputes between the parties under the agreement or the award rendered thereon by the arbitral tribunal. The respondent, which is entitled to costs under the award, has not sought to implement it yet. The petitioner insists, however, that courts in this country - this High Court on its Original Side being one of them - is competent to receive a challenge to the award notwithstanding the place of the arbitration having been outside India and despite the respondent not having attempted to implement it. The petitioner wants to have the award set aside to be able to pursue afresh in support of its claim.
(2.) It may be of some relevance, however, that the petitioner has fashioned the challenge under Section 48 of the Arbitration and Conciliation Act, 1996 and, for good measure, has also invoked the provisions of Section 34 of the 1996 Act and Sections 47 and 151 of the Code of Civil Procedure, 1908. Section 48 of the 1996 Act does not recognise a right to apply thereunder for having any award set aside; it only sets down the conditions for enforcement of a foreign award governed by the New York Convention upon such an award being sought to be enforced. The right to apply for the enforcement of a New York Convention award is under Section 49 of the 1996 Act, whereupon the grounds under Section 48 of the Act may be cited by the party against whom it is sought to be enforced to resist the enforcement thereof. Such right will be available to the party against whom such award is sought to be enforced irrespective of whether such party makes a supplemental application to resist it. The right to resist the enforcement of a New York Convention award is conditional upon such an award being endeavored to be enforced and does not appear to be independent of any attempt at enforcement. At any rate, nothing in Section 48 of the Act, or elsewhere in the first chapter of Part II of the 1996 Act which deals exclusively with New York Convention awards and matters relating thereto, confers any right on any person to apply to have any award set aside thereunder. The petitioner cannot show that Section 47 of the Code gives an award-debtor the right to initiate a challenge to the award even without the award ripening for enforcement. Section 151 of the Code does not expressly recognise any right to apply thereunder nor has the petitioner urged that its right to apply is founded on such provision.
(3.) Courts in this country operating under the Constitutional scheme of things do not have plenary, all-pervasive authority to receive any grievance and proceed to redress the perceived wrong. Courts in this country function under statutory mandates and are authorised to entertain such matters as are ordained by law or, in respect of civil suits, such claims as are not expressly prohibited by law or by necessary implication. An arbitration Judge in this court is competent to receive only such matters as have been administratively assigned by the Chief Justice and as are governed by the applicable statutes: the Arbitration Act, 1940 and the Arbitration and Conciliation Act, 1996. For instance, the arbitration Judge in this court can receive a request under Section 11 of the 1996 Act but, by dint of the allocation of business by the Chief Justice, cannot name the arbitrator even if a request under Section 11 of the 1996 Act is otherwise found to be meritorious and entitling the party carrying the request to have an arbitrator named or the arbitral tribunal constituted to take up the reference. The business of naming the arbitrator has, at times, been allocated to Judges other than the arbitration Judge and is now retained by the Chief Justice. If the arbitration Judge in this court finds a request under Section 11 of the 1996 Act to be in order, a finding to such effect is returned and the matter is then directed to be placed elsewhere for the naming of the arbitrator or the constitution of the arbitral tribunal.;