Alerts & Updates 25th Jun 2020
Recently, in National Agricultural Cooperative Marketing Federation of India v. Alimenta S.A., an appeal was filed against the enforcement of foreign award before the Supreme Court.
The award for damages was made against National Agricultural Cooperative Marketing Federation of India (NAFED), an agency of the Government of India, for breach of its contractual obligations to supply groundnuts (commodity) to the buyer. The agency was unable to fulfil its supply obligations due to export prohibitions imposed by the Government of India.
Amongst other issues, the Supreme Court determined (i) whether prohibition of the Government upon the export of the commodity rendered the contract void and unenforceable, and (ii) whether said the prohibition was sufficient to render the award unenforceable under Section 7 of the Foreign Awards (Recognition and Enforcement) Act, 1961. The Supreme Court inter alia held that enforcement of the award would be violative of the public policy of India. The Supreme Court allowed the appeal filed by the NAFED against enforcement of the award. The award was held to be unenforceable, with no order as to costs.
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