Special Leave To Appeal Against HC Judgment Recognizing And Enforcing A Foreign Award Would Lie Only On 'Extremely Narrow Ground': SC [Read Order]

The Supreme Court has observed that an appeal under  Article 136 of the Constitution of India against a High Court judgment that recognises and enforces a foreign award would lie only on an extremely narrow ground.

'Blatant disregard of Section 48 in very exceptional cases' is not a mantra to be used indiscriminately, the court observed while dismissing the special leave to appeal filed by Responsive Industries Limited against a Bombay High Court judgment.

While considering the contentions, the bench noted the observations made in Vijay Karia and Ors. vs. Prysmian Cavi E Sistemi SRL an appeal is provided against a judgment refusing to recognise and enforce a foreign award but not the other way around (i.e. an order recognising and enforcing an award). Referring to Para 24 of the said judgment, the bench comprising Justices RF Nariman, Navin Sinha and KM Joseph said:

This paragraph makes it clear beyond any doubt that Article 136 cannot be used to circumvent the statutory scheme which is contained in Section 50 of the Arbitration Act of 1996. If an Award is enforced under Section 48 by a learned Single Judge of the High Court, no appeal against such judgment shall lie. Obviously, the statutory scheme indicates that even if there be an incorrect judgment by a learned Single Judge on facts or law, such judgment is not appealable. This being the case, we clearly laid down in paragraph 24 (supra) that an appeal under Article 136 would lie on an extremely narrow ground; only if some new or unique point is raised as to the interpretation of the Arbitration Act which has not been answered by the Supreme Court.

With regard to the observation in the said judgment that such an appeal would only be in a very exceptional case of a blatant disregard of Section 48 of the Arbitration Act, the bench further observed:

Blatant disregard of Section 48 in very exceptional cases is not a mantra to be used indiscriminately. Unfortunately, we find that case after case comes before us attempting to fit a square peg into a round hole. The present case does not remotely contain any feature that would open the gates of our jurisdiction under Article 136 as laid in paragraph 24 (supra)."

The court therefore dismissed the SLP by imposing Rs. 10,00,000/- each costs on the petitioners.

Case: RESPONSIVE INDUSTRIES LIMITED vs. BANYAN TREE GROWTH CAPITAL L.L.C  [Special Leave to Appeal (C) Nos.11404-11405/2020]

Coram: Justices RF Nariman, Navin Sinha and KM Joseph

Counsel: Sr. Adv. Mukul Rohatgi and Sr. Adv.K.V. Viswanathan

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