A suit challenging a foreign award is not maintainable in law.

Soumen Sen, J.

The instant application has been filed by the defendant for rejection of plaint and for dismissal of suit.

The plaintiff has filed this suit praying, inter alia, for setting aside of a foreign award made in pursuance of an arbitration clause contained in a contract dated 22nd October, 2009. The arbitration clause reads:-

“Clause 15 Arbitration.

All disputes in connection with this contract or the execution thereof shall be settled amicably by friendly negotiations between the two parties. If no settlement can be reached, the case in dispute shall then be submitted for arbitration in Singapore. Arbitration result should be final and binding on both parties.”

The basis of the instant application is that a suit challenging an award is not maintainable in law.

Mr. Abhrajit Mitra, the learned Senior Counsel appearing on behalf of the applicant submits that the Arbitration and Conciliation Act, 1996 is a complete code as has been held in Fuerst Day Lawson Vs. Jindal Exports Limited (AIR 2011 SC 2649 Paragraph 72: 2011(8) SCC 333) and, accordingly, the plaintiff can only challenge the award in the manner and circumstances as provided in the statute.

It is submitted that an Act is to be held as a complete code when, inter alia, the Act itself provides for an adjudicatory mechanism and exclusion of the application of other statutes (expressly or by necessary implication). The applicant has relied upon Paragraph 79 of the judgment in Girnar Traders Vs. State of Maharashtra reported at (2011) 3 SCC 1.

In support of his submission that no suit lies for setting aside of a foreign award, reliance has been placed on the following decisions:-

i) Spentex Industries Limited Vs. Dunvant SA (Division Bench of the Delhi High Court dated 29/10/2009) Paragraphs 4,8,9 and 10;

ii) Coal India Limited Vs. Canadian Commercial Corporation reported at 2013 (2) CHN 494 Paragraphs 22, 24 to 29.

It is submitted that so far as domestic award is concerned, the law is the same both under the 1940 Act as well as 1996 Act. No suit lies for setting aside of a domestic award. In this regard, the applicant has referred to the following decisions:-

i) Deokinandan Vs. Basantalal reported at AIR 1941 Cal 527;

ii) Ashok Kalra Vs. Akash Towers.

It is submitted that Section 5 of the Arbitration & Conciliation Act, 1996 is of general principle which would be applicable to all arbitration proceedings irrespective of whether it is domestic or international arbitration. In Board of Trustees for the Port of Calcutta Vs. Louis Dreyfus G.A.No.1997 of 2014, C.S.No.220 of 2014 dated 29th September, 2014, the judgment of the Hon’ble Supreme Court in Chatterjee Petrochem Co. & Anr. Vs. Haldia Petrochemicals Ltd. reported at 2014 (1) Cal LT 83(SC) on this proposition was expressly followed. It was held:-

“The judgment cited at the bar would show that Section 5 of the Arbitration & Conciliation Act is a general principle which would be applicable to all arbitration proceedings irrespective of fact whether it is a domestic arbitration or an international arbitration.”

The same proposition was also followed in Enercon (India) Ltd. & Ors. Vs. Enercon GMBH & Anr. reported at 2014 (5) SCC 1 in Paragraph 90 in which the Hon’ble Supreme Court emphasized the need for least intervention by Courts in arbitration matter in view of Section 5 of the Act.

The policy behind Part II of the Arbitration & Conciliation Act, 1996 and especially Sections 46 to 49 is that enforceability of a foreign award is to be decided only when execution application is filed by the award holder. The said provisions do not even contemplate two several applications, one deciding enforceability of foreign award and the other for execution of foreign award. In this regard the defendant has referred to the following decisions of the Hon’ble Supreme Court:-

i) Fuerst Day Lawson Vs. Jindal Exports Limited reported at AIR 2001 SC 2293 Paragraph 29 at Page 2303: 2001(6) SCC 356.

ii) Shri Lal Mahal Vs. Pr