The main legal point established in the judgment is that the law governing the arbitration agreement may be different from the proper law of the main contract, and the applications under Section 34 of the Indian Act were not maintainable against the foreign awards made in England.

JUDGMENT

A.K. Patnaik, C.J.

1. The two miscellaneous appeals are appeals under Section 37(1)(b) of the Arbitration and Conciliation Act, 1996 (hereinafter referred to as "the Indian Act").

2. The facts briefly are that an agreement dated 22-4-1993 was executed between the appellant and the respondent under which the respondent was to supply installed equipment for modernization and upgradation of the production facilities of the appellant at Korba in the State of Chhattisgarh. The agreement provided for settlement of disputes by arbitration, Certain disputes arose between the parties and were referred to arbitration. The arbitration was held in England and the arbitral tribunal made two awards dated 10-11-2002 and 12-11-2002 in England. The appellant thereafter, filed applications under Section 34 of the Indian Act for setting aside the two awards dated 10-11-2002 and 12-11-2002 in the Court of learned District Judge, Bilaspur which were numbered as MJC Nos. 92 of 2003 and 14 of 2003, respectively. By order dated 20-7-2004, the learned District Judge, Bilaspur held that the applications filed by the appellant under Section 34 of the Indian Act for setting aside the two foreign awards are not tenable and accordingly dismissed the same. Aggrieved, the appellant has filed these appeals.

3. Mr. Vivek Tankha and Mr. S. N. Mukherjee, learned Counsel appearing for the appellant in the two appeals submitted that in the impugned order dated 20-7-2004, the learned District Judge has held that the application filed by the appellant under Section 34 of the Indian Act was not maintainable, but the learned District Judge has not recorded any reason whatsoever for coming to the aforesaid conclusion. They argued that the learned District Judge should have decided the issues of fact and law raised by the parties in their respective pleadings, but no such exercise has been undertaken by the learned District Judge in the impugned order. They submitted that since the impugned order is without any reason, it is liable to be set aside. In support of their submission, they relied on the decision of the Supreme Court in Smt. Swaran Lata Ghosh vs. Harendra Kumar Banerjee, and State of Punjab vs. Bhag Singh,

4. Mr. Tankha next submitted that the learned District Judge has proceeded on the assumption that the provisions of Section 34 of the Indian Act are not applicable to a "foreign award" and for this reason held that the applications filed by the appellant under Section 34 of the Indian Act to set aside the foreign awards were not maintainable. He submitted that this view taken by the learned District Judge is contrary to the decision of the Supreme Court in Bhatia International v. Bulk Trading S.A., in which it has been held that the Indian Act applied to the arbitration which are held in India between the Indian Nationals as well as to international commercial arbitrations whether held in India or out of India. He also cited the decision of the Gujarat High Court in Nirma Ltd. vs. Lurgi Energie Und Entsorgung GMBH, Germany, in which a Division Bench of the Gujarat High Court has taken a view that when the agreement between the parties was governed by the Indian law, then the application for setting aside the award made outside the country can also be filed in a Court in India under Section 34 of the Indian Act. Mr. Tankha submitted that since the agreement between the parties was governed by the Indian law, the learned District Judge should have held that the applications for setting aside the awards could be filed under Section 34 of the Indian Act before the learned District Judge at Bilaspur.

5. Mr. Mukherjee, learned Counsel appearing for the appellant further submitted that Article 22 of the agreement between the parties provided that the agreement will be governed by the prevailing law of India and therefore parties to the agreement have chosen the prevailing law of India as the law governing the rights of the parties. He submitted that since the s