ELP Arbitration Weekly Alert

This week, we have analyzed the Supreme Court’s decision in Sundaram Finance Limited v. Abdul Samad and provided a snapshot of the recent decision of the Bombay High Court in Global Aviation Services Private Limited v. Airport Authority of India[2].

In Sundaram Finance Limited, the question which arose for consideration before the Court was whether an award-holder has to first file the award in the court having jurisdiction over the arbitration proceedings and then obtain a transfer of the decree to the court where the assets of the judgment debtor are located, or if the award can directly be executed by the court in whose jurisdiction the assets of the award-debtor are situated. The Court examined the conflicting decisions of different high courts on the said issue and held that an award may be executed directly by the court having territorial jurisdiction over the award-debtor’s assets, and there is no need for transfer of the decree.

In Global Aviation Services, the issues which arose for consideration before the High Court were (i) whether the requirement of issuing a notice to the respondent under section 34(5) before filing an application to set aside an arbitral award is mandatory or directory in nature; and (ii) applicability of the Arbitration and Conciliation (Amendment) Act, 2015 to arbitrations and arbitration related court proceedings. The High Court ruled that Section 34(5) of the Act is directory, and merely because party fails to issue notice in terms of the said provision, does not mean their substantive right under Section 34(1) of the Act is obliterated. The High Court also held that the provisions of the Amendment Act, would only apply to those proceedings in which the notice of arbitration has been received by the other party after the Amendment Act came into force i.e. October 23, 2015. We will share a detailed analysis of the decision in Global Aviation Services with you in our next update.

We trust you will find this an interesting read. For any queries or comments on this update, please feel free to contact us at drupdate@elp-in.com.

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