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1999 Supreme(Bom) 953

BOMBAY HIGH COURT
D.K. Deshmukh, J.
CETACO SA - PETITIONER
v.
BOMBAY EXPORT INTERNATIONAL - RESPONDENT
Arbitration Petition No. 81 of 1997,
Decided on: December 14, 1999

Advocates appeared:
Sh. D.R. Zaiwalla with Sh. K.A. Setalvad i/b Mulla and Mulla and Craigie Blunt and Caroe, for the Petitioner.
Sh. A.M. Vernekar with Sh. N.M. Dagli, Sh. Sudeep Dasgupta and Sh. Leon Samuel, for the Respondent.

A foreign award can be enforced under the Foreign Awards (Recognition and Enforcement) Act, 1961, if the requirements of the Act are met and the objections to enforceability specified in Section 7 of the Act are not established.

Headnote:

FOREIGN AWARDS (RECOGNITION AND ENFORCEMENT) ACT, 1961 - SECTION 5, 6, 7, 8 - ENFORCEMENT OF FOREIGN AWARD - REQUIREMENTS AND PROCEDURE - OBJECTIONS TO ENFORCEABILITY - CONSIDERATION OF EXISTENCE OF ARBITRATION AGREEMENT BY ARBITRATORS.

Fact of the Case:

Petitioner filed for enforcement of a foreign award under the Foreign Awards (Recognition and Enforcement) Act, 1961. Respondent objected on grounds of non-compliance with Section 8 requirements, non-filing of original arbitration agreement, and the existence of an arbitration agreement.

Finding of the Court:

The court found that the duly authenticated copy of the award was filed, the documents dated 23rd November 1994 and 18th January 1995 constituted concluded contracts between the parties, and the arbitrators had held the existence of the arbitration agreement to have been proved.

Issues: 1. Whether the requirements of Section 8 of the Foreign Awards (Recognition and Enforcement) Act, 1961 were complied with? 2. Whether the original arbitration agreement was filed? 3. Whether there was an arbitration agreement in existence between the parties?

Ratio Decidendi: 1. The court held that the requirement of filing a duly authenticated or certified copy of the award is a procedural requirement and the petitioners had filed a true copy of the award with the petition. 2. The court relied on the judgment in Promatha Nath Mullick v. Batliwalla and Karani and Jugal Kishore Rameshwardas v. Mrs. Goolbai Hormusji to hold that the confirmation note dated 23rd November 1994 sent by the common broker constituted a concluded contract between the parties. 3. The court found that the arbitrators had held the existence of the arbitration agreement to have been proved, satisfying the requirements of Section 7 of the Act.

Final Decision: The petition for enforcement of the foreign award was granted in terms of prayer Clauses (a) and (c). Enforcement of the order was stayed for eight weeks from the date of the judgment.

JUDGMENT

D. K. DESHMUKH, J. - This petition has been filed for enforcing a foreign award under the Foreign Awards (Recognition and Enforcement) Act, 1961 (hereinafter referred to as the said Act). Section 5 of the said Act lays down that any person interested in foreign award can apply to the competent Court for filing of the award. Section 6 of the said Act lays down that if the Court is satisfied that the foreign award is enforceable under the Act, then the Court shall direct to file the award and the Court shall proceed to pronounce the judgment according to the award. The present petition therefore has been filed for filing of the award dated 30th October, 1995 and also for an order in terms of that award. By the said award dated 30th October, 1995, the Arbitrators have awarded a sum of 1,50,000 U.S. dollars to the petitioners with interest.

2. The petition has been opposed by the respondents. The first objection that is raised by the respondent is that the petitioners have not complied with the requirements of Section 8 of the said Act inasmuch as neither original award nor a duly authenticated copy thereof was filed with the petition. The second objection is that the original agreement for arbitration or certified copy thereof has also not been filed. The third objection raised by the respondents is that the respondents had raised an objection before the Arbitrators to the effect that there is no arbitration agreement in existence between the parties inasmuch as the respondents by their fax message dated 24th November, 1994 had informed that fosfa terms, which includes the arbitration clause, are not acceptable to them. According to the learned counsel appearing for the respondents, the Arbitrators were therefore under a duty to consider the question of existence of arbitration Clause while making the award. According to the learned counsel, the Arbitrators have not decided the question of existence of arbitration clause and therefore, the award is illegal.

3. It is further urged that in any case, it is clear from the material produced before this Court that the respondent had not agreed to inclusion of fosfa terms in the contract and therefore, there was no arbitration agreement in existence between the parties and therefore, the award is illegal as the Arbitrators had no jurisdiction to make the award.

4. So far as the first objection raised by the learned counsel for the respondent is concerned, it is true that when the petition was filed, neither original nor duly authenticated copy of the award was filed. However, along with the affidavit dated 13th December, 1999, the petitioners have filed the duly authenticated copy of the award. In my opinion therefore, the objection raised by the learned counsel for the respondents does not survive. The requirement of filing a duly authenticated or certified copy of the award is a procedural requirement. The petitioners had filed a true copy of the award with the petition. There is no dispute raised that the copy of the award that was filed by the petitioners along with the petition is not really a true copy of the award. In these circumstances therefore, in view of the presentation of duly authenticated copy of the award by the petitioners, the objection does not survive.

5. Now the second objection raised by the respondents that a certified copy of the arbitration agreement had not been filed and the question whether the respondents had disagreed to accept the fosfa terms can be taken up for consideration together. According to the petitioners, the petitioners have filed with the affidavit of Joseph B, Barrett, true copies of the contracts between the parties dated 23rd November, 1994 and 18th January, 1995. It is the case of the petitioners that the documents dated 23rd November, 1994 and 18th January, 1995 are a concluded contract between the parties which includes the stipulation that fosfa terms are applicable to the parties. It is submitted on behalf of the petitioners t







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