Case Note & Summary
The petitioners, Pacific Basin Ihx (UK) Ltd., a company incorporated in England engaged in shipping, sought enforcement of a foreign arbitration award dated 8 July 2009 and a costs award dated 15 March 2010 against the respondent, Ashapura Minechem Ltd., an Indian company. The awards arose from disputes under a Contract of Afreightment dated 25 October 2007 concerning three shipments of bauxite. The respondent filed a Special Civil Suit in Jamkhambalia, Gujarat seeking a declaration that the contract was void and an injunction restraining the arbitration. The ex parte injunction was vacated on 12 January 2009, and the petitioners proceeded with arbitration, resulting in the awards. The respondent then filed an application under Section 34 of the Arbitration and Conciliation Act, 1996 in the court at Jamkhambalia on 20 July 2009 to set aside the award. Subsequently, the petitioners filed the present enforcement petition in the Bombay High Court under Part II of the Act. The respondent raised a preliminary objection that the Bombay High Court lacked jurisdiction because of Section 42 of the Act, which provides that once an application under Part I is filed in a court of competent jurisdiction, all subsequent applications arising from the same arbitration agreement must be made to that court alone. The petitioners argued that the Section 34 application was not maintainable and that the foreign award could be enforced independently under Part II. The court considered the submissions and held that Section 42 is mandatory and operates to vest exclusive jurisdiction in the court where the Section 34 application was first filed, thereby preventing the Bombay High Court from entertaining the enforcement petition. Consequently, the petition was dismissed for lack of jurisdiction.
Headnote
A) Arbitration - Enforcement of Foreign Award - Jurisdiction - Section 42, Arbitration and Conciliation Act, 1996 - Petitioners filed petition under Part II for enforcement of two foreign arbitration awards; respondent had earlier filed Section 34 application in court at Jamkhambalia, Gujarat. Court addressed maintainability in view of Section 42 which requires all subsequent applications arising out of same arbitration agreement to be filed in the court where first application under Part I was filed. Held that Bombay High Court had no jurisdiction to entertain the enforcement petition (Paras 11-12).
Issue of Consideration
Whether the Bombay High Court has jurisdiction to entertain a petition for enforcement of a foreign award under Part II of the Arbitration and Conciliation Act, 1996 when a prior application under Section 34 of the Act (to set aside the award) has already been filed in a court at Jamkhambalia, Gujarat, and Section 42 of the Act mandates all subsequent applications arising out of the same arbitration agreement to be made in that court.
Law Points
- Section 42 of Arbitration Act is mandatory
- exclusive jurisdiction of court where prior application under Part I is filed
- subsequent applications including enforcement under Part II must be before same court
- foreign award enforcement cannot be in different court if section 34 application already pending
