Enforcement of foreign arbitral awards under the Arbitration and Conciliation Act 1996

With the rapid growth of cross-border commercial transactions, arbitration has emerged as the preferred mechanism for dispute resolution. India, being a signatory to the New York Convention, has adopted a pro-enforcement regime for recognition and enforcement of foreign arbitral awards. The enforcement of such awards in India is governed by Part II, Chapter I of the Arbitration and Conciliation Act, 1996 (“the Act”), which gives effect to the New York Convention Awards.

Foreign arbitral awards are enforced in India under Sections 44 to 52 of the Act. An award is considered a “foreign award” if it arises out of a commercial relationship and is made in a country notified as a reciprocating territory under the New York Convention.

Section 44 of the Act defines a foreign award as an arbitral award arising out of differences between persons relating to legal relationships, whether contractual or not, which are considered commercial under Indian law. The award must have been made on or after 11 October 1960 and pursuant to a written arbitration agreement to which the New York Convention applies. Further, the award must be rendered in a territory notified by the Central Government as a Convention country.

Thus, the essential elements of a foreign award are:

• A legal relationship of a commercial nature

• An arbitration agreement in writing

• The award being rendered in a notified New York Convention country

• The award being made after the specified cut-off date

The concept of international commercial arbitration is defined under Section 2(1)(f) of the Act. An arbitration qualifies as international if it arises out of a commercial legal relationship and at least one of the parties is:

• An individual who is a national of, or habitually resident in, a foreign country

• A body corporate incorporated outside India

• An association or body of individuals whose central management is exercised outside India

• A foreign government

Part II of the Act lays down a self-contained mechanism for enforcement of foreign awards. /

The key provisions include:

• Section 44 – Definition of foreign award

• Section 46 – Binding nature of foreign awards

• Section 47 – Evidence required for enforcement

• Section 48 – Conditions for refusal of enforcement

• Section 49 – Enforcement of foreign awards as decrees of court

Once the court is satisfied that the award is enforceable under Section 48, it is deemed to be a decree of the court under Section 49.

Section 47 of the Act mandates the production of specific documents while seeking enforcement of a foreign award.

These include:

• The original award or a duly authenticated copy

• The original arbitration agreement or a certified copy thereof

• Evidence necessary to establish that the award is a foreign award

• A certified English translation of the award, where required, authenticated by a diplomatic or consular authority

Enforcement of a foreign award may be refused at the request of the opposing party if it is proved that:

• Parties to the agreement were under incapacity

• The arbitration agreement was invalid

• Proper notice was not given or the party was unable to present its case

• The award deals with disputes beyond the scope of the arbitration agreement

• The composition of the arbitral tribunal or procedure was not in accordance with the agreement

• The award has not yet become binding or has been set aside or suspended 

The court may suo motu refuse enforcement if:

• The subject matter of the dispute is not capable of settlement by arbitration under Indian law

• Enforcement would be contrary to the public policy of India

• Public policy is narrowly construed and includes only

• Fraud or corruption or violation of Sections 75 or 81 of the Act

• Contravention of the fundamental policy of Indian law

• Conflict with the basic notions of morality or justice

Indian courts have consistently adopted a pro-enforcement stance. In Shri Lal Mahal Ltd. v. Progetto Grano Spa, the Supreme Court held that Section 48 does not permit a “second look” at the merits of a foreign award. The court clarified that enforcement proceedings are not appellate in nature and procedural irregularities alone do not justify refusal on public policy grounds.

Similarly, in Vijay Karia v. Prysmian Cavi, Ssangyong Engineering v. NHAI, and Gemini Bay Transcription v. Integrated Sales Services, the Supreme Court reiterated the narrow scope of interference and emphasized minimal judicial intervention at the enforcement stage.

In Fuerst Day Lawson Ltd. v. Jindal Exports Ltd, the Court held that a single composite proceeding is sufficient for both recognition and execution of a foreign award, eliminating the need for multiple stages of litigation.

The applicability of Section 9 to foreign awards was clarified in Aircon Beibars FZE v. Heligo Charters Pvt. Ltd, where the court held that interim protection may be granted to safeguard assets pending enforcement under Section 48. This ensures that the award holder is not rendered remediless due to dissipation of assets before the award becomes enforceable.

The Arbitration and Conciliation Act, 1996 establishes a robust and enforcement-friendly framework for foreign arbitral awards in India. By limiting judicial scrutiny to narrowly defined grounds and aligning domestic law with international standards, Indian courts have reinforced India’s commitment to the New York Convention.

About the authors: Sonam Mhatre is a Partner and Darshil Thakkar is a Senior Associate at Dhaval Vussonji & Associates.

Disclaimer: The opinions expressed in this article are those of the author(s). The opinions presented do not necessarily reflect the views of Bar & Bench.

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