Supreme Court of India
FUERST DAY LAWSON LTD.versusJINDAL EXPORTS LTD.
- Citation
- 2011 INSC 479
- Decided
- 8 July 2011
- Disposal
- Disposed off
- Bench
- AFTAB ALAM
Holding
No Letters Patent appeal will lie against an order which is not appealable under section 50 of the Arbitration and Conciliation Act, 1996.
Summary
The Supreme Court examined a batch of Special Leave Petitions arising from orders of the Delhi and Calcutta High Courts that refused to enforce foreign arbitral awards or to award interest. The central question was whether an order that is not appealable under section 50 of the Arbitration and Conciliation Act, 1996 could nevertheless be challenged by invoking the Letters Patent jurisdiction of the High Court. The Court held that the 1996 Act is a self‑contained, exhaustive code and that sections 49 and 50 expressly exclude any further appeal, including a Letters Patent appeal, unless the order falls within the limited class of orders listed in section 50. The omission of the words “(and from no others)” in section 50 was deemed immaterial, and the scheme of the Act overrides the general law procedure. Consequently, the Court allowed Civil Appeal No. 36 of 2010, set aside the division‑bench order that had permitted a Letters Patent appeal, and dismissed the remaining SLPs. The decision clarifies that no Letters Patent appeal lies against an order not appealable under section 50 of the 1996 Act.
Issues considered
- Whether an order not appealable under s.50 of the Arbitration and Conciliation Act, 1996 is nevertheless appealable under the Letters Patent of the High Court.
- Whether the Arbitration and Conciliation Act, 1996 constitutes a self‑contained code that excludes the application of general procedural law, including Letters Patent jurisdiction.
- Whether the omission of the words “(and from no others)” in s.50 creates a substantive difference from s.37 of Part I.
- Whether the scheme of sections 49 and 50 of the 1996 Act eliminates any residual right of appeal, including a Letters Patent appeal.
Legislation cited
- Arbitration Act, 1940s. 17, s. 39, s. 6
- Arbitration and Conciliation Act, 1996s. 37, s. 49, s. 50
- Code of Civil Procedure, 1908s. 104
- Foreign Awards (Recognition and Enforcement) Act, 1961s. 44, s. 45, s. 46, s. 47, s. 48, s. 49, s. 50
Subjects
ArbitrationLetters Patent AppealArbitration and Conciliation Act 1996Section 50Self‑contained codeForeign award enforcementAppellate jurisdictionStatutory interpretation
Judgment
[2011] 11 S.C.R. 1
FUERST DAY LAWSON LTD. A
v.
JINDAL EXPORTS LTD.
(SLP (C) No. 11945 of 2010)
JULY 8, 2011
B
[AFTAB ALAM AND R.M. LODHA, JJ.]
Arbitration and Conciliation Act, 1996 - ss. 50 and 49 -
Whether an order, though not appealable under s. 50 of the
1996 Act, would nevertheless be subject to appeal under the C
relevant provision of the Letters Patent of the High Court -
Held: No letters patent appeal will lie against an order which
is not appealable under s.50 of the 1996 Act - Conclusion
regarding exclusion of letters patent appeal arrived at in two
different ways; one, so to say, on a micro basis by examining D
the scheme devised by ss. 49 and 50 of the 1996 Act and
the radical change that it brings about in the earlier provision
of appeal under s. 6 of the 1961 Act and the other on a macro
basis by taking into account the nature and character of the
1996 Act as a self-contained and exhaustive code in itself - E
Where the special Act sets out a self-contained code the
applicability of the general law procedure would be impliedly
excluded - Foreign Awards (Recognition and Enforcement)
Act, 1961 - s.6 - Letters Patent.
Arbitration and Conciliation Act, 1996 - Part I and Part F
II of the Act - Difference between - Held: Part I and Part II of
the Act are quite different in their object and purpose and the
respective schemes.
Arbitration and Conciliation Act, 1996 - ss. 37 and 50 - G
Appellate provision uls. 37 and u/s. 50 - Difference between
- Held: s137 in Part I of the Act (analogous to s. 39 of the 1940
Act) is not comparable to s.50 in Part II of the Act - s.37 and
s. 50 are not comparable because they belong to two different
1 H
2 SUPREME COURT REPORTS [2011] 11 S.C.R.
A statutory schemes - s.37 containing the provision of appeal
is part of a much larger framework that has provisions for the
complete range of law concerning domestic arbitration and
international commercial arbitration - s.50 on the other hand
contains the provision of appeal in a much limited framework,
B concerned only with the enforcement of New York Convention
awards - In one sense, the two sections, though each
containing the appellate provision belong to different statutes.
Arbitration and Conciliation Act, 1996 - Part II, Chapter
C I - Provisions of, compared with the provisions of the Foreign
Awards (Recognition and Enforcement) Act, 1961.
The question that arose for consideration in the
present batch of cases was whether an order, though not
appealable under section 50 of the Arbitration and
D Conciliation Act, 1996, would nevertheless be subject to
appeal under the relevant provision of the Letters Patent
of the High Court i.e. in other words, whether, even
though the ·Arbitration Act does not envisage or permit
an appeal from the order, the party aggrieved by it can
E still have his way, by-passing the Act and taking recourse
to another jurisdiction.
Dismissing appeals arising from SLP (C) No.31068 of
2009 and SLP (C) No.4648 of 2010 and allowing Civil
F appeal no.36 of 2010, the Court
HELD:1. A correct answer to the question under
consideration would depend upon how the Arbitration
and Conciliation Act, 1996 is to be viewed. Do the
provisions of the 1996 Act constitute a complete code for
G matters arising out of an arbitration proceeding, the
making of the award and the enforcement of the award?
If the answer to the question is in the affirmative then,
obviously, all other jurisdictions, including the letters
patent jurisdiction of the High Court would stand
H excluded. [Paras 3, 4] [11-F-G; 12-A-B]
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 3
LTD.
2.1. Before the coming into fgrce of the Arbitration A
and Conciliation Act, 1996 with effect from August 16,
1996, the law relating to domestic arbitration was
contained in the Arbitration Act, 1940, which in turn was
brought in place of the Arbitration Act, 1899. Apart from
the Arbitration Act 1940, there were two other enactments B
of the same genre. One called the Arbitration (Protocol
and Convention) Act, 1937 (for execution of the Geneva
Convention Awards) and the other called the 'Foreign
Awards (Recognition and Enforcement) Act, 1961 (for
enforcement of the New York Convention awards). The c
aforesaid three Acts were replaced by the Arbitration and
Conciliation Act, 1996, which is based on the United
Nations Commission on International Trade Law
(UNCITRAL) Model and is broadly compatible with the
"Rules of Arbitration of the International Chamber of
0
Commerce". The Arbitration and Conciliation Act, 1996
that has repealed the Arbitration Act, 1940 and also the
Acts of 1937 and 1961, consolidates and amends the law
relating to domestic arbitration, international commercial
arbitration, enforcement of foreign arbitral awards and
defines the law relating to conciliation and provides for E
matters connected therewith and incidental thereto
taking into account the UNCITRAL MODEL law and Rules.
[Paras 43, 44, 45) [31-G-H; 32-A-F]
2.2. The 1996 Act is a loosely integrated version of F
the Arbitratioli Act, 1940, Arbitration (Protocol and
Convention) Act, 1937 and Foreign Awards (Recognition
and Enforcement) Act, 1961. It actually consolidates
amends and puts together three different enactments.
But having regard to the difference in the object and G
purpose and the nature of these three enactments, the
provisions relating thereto are kept separately. A mere
glance at the 1996 Act is sufficient to show that under its
scheme the provisions relating to the three enactments
are kept separately from each other. The 1996 Act is H
4 SUPREME COURT REPORTS [2011] 11 S.C.R.
A divided into four parts and it has three schedules at its
end. Part I has ten chapters that contain provisions
governing domestic arbitration a·nd international
commercial arbitration. Part II has two chapters; Chapter
I contains provisions relating to the New York Convention
B Awards and Chapter II contains provisions relating to the
Geneva Convention Awards. Part Ill of the Act has
provisions concerning conciliation. Part IV has the·
supplementary provisions such as the power of the High
Court to make rules (section 82), provision for removal
c of difficulties (section 83), and the power to make rules
(section 84). At the end there are two repeal and saving
sections. Section 85 repeals the three enactments
referred to above, subject to the appropriate saving
clause and section 86 repeals Ordinance 27 of 1996, the
precursor of the Act, subject to the appropriate saving
0
clause. Of the three schedules, the first is related to Part
II, Chapter I, i.e., the New York Convention Awards and
the second and the third to Chapter II, i.e., the Geneva
Convention Awards. [Para 48] [36-C-H; 37-A]
E 2.3. There is a certain similarity between the
provisions of Chapters I and II of Part II but Part I of the
Act is vastly different from Chapters I and II of Part II of
the Act. This is quite understandable too since Part II
deals only with enforcement of foreign awards (Chapter
F I, of New York Convention Awards and Chapter II, of
Geneva Convention Awards) whi.le Part I of the Act deals
with the whole gamut of law concerning domestic
arbitration and international commercial arbitration. It has,
therefore, a very different and much larger framework
G than the two chapters in Part II of the Act. [Para 49] [37-
8-C]
2.4. It is also evident that Part I and Part II of the Act
are quite separate and contain provisions that act
independently in their respective fields. The opening
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 5
LTD.
words of section 2, i.e. the definition clause in Part I, make A
it clear that meanings assigned to the terms and
expressions defined in that section are for the purpose
of that part alone. Section 4 which deals with waiver of
right to object is also specific to Part I of the Act. Section
5 dealing with extent of judicial intervention is also B
specific to Part I of the Act. Section 7 that defines
"arbitration agreement" in considerable detail also
confines the meaning of the term to Part I of the Act alone.
Section 8 deals with the power of a judicial authority to
refer parties to arbitration where there is an arbitration C
agreement and this provision too is relatable to Part I
alone (corresponding provisions are independently made
in sections 45 and 54 of Chapter I and II, respectively of
Part II). The other provisions in' Part I by their very nature
shall have no application insofar as the two chapters of D
Part II are concerned. Once it is seen that Part· I and Part
II of the Act are quite different in their object and purpose
and the respective schemes, it naturally follows that
section 37 in Part I (analogous to section 39 of the 1940
Act) is not comparable to section 50 in Part II of the Act.
This is not because, as appellant contends section 37 has E
the words in parentheses "and from no others" which are
not to be found in section 50 of the Act. Section 37 and
section 50 are not comparable because they belong to
two different statutory schemes. Section 37 containing the
provision of appeal is part of a much larger framework · F
that has provisions for the complete range of law
concerning domestic arbitration and international
commercial arbitration. Section 50 on the other hand
contains the provision of appeal in a much limited
framework, concerned only with the enforcement of New G
York Convention awards. In one sense, the two sections,
though each containing the appellate provision belong to
different statutes. [Paras 51, 52] [37-G-H; 38-A-G]
2.5. A comparison of the provisions of Chapter I of H
6 SUPREME COURT REPORTS [2011] 11 S.C.R.
A Part II of the 1996 Act and the provisions of the Foreign
Awards (Recognition and Enforcement Act), 1961, would
show that section 44, the definition clause in the 1996 Act
is a verbatim reproduction of section 2 of the previous
Act (but for the words "~hapter" in place of "Act", "first
B schedufe" in place of "schedule" and the addition of the
word "arbitral" before the word "award" in section 44).
Section 45 corresponds to section 3 of the previous Act.
Section 46 is a verbatim reproduction of section 4(2)
except for the substitution of the word "chapter" for
C "Act". Section 47 is almost a reproduction of section 8
except for the addition of the words "before the court"
"in sub-section (1)" and an explanation as to what is
meant by "court" in that section. Section 48 corresponds
to section 7; section 49 to section 6(1) and section 50 tp
section 6(2). Apart from the fact that the provisions are
0
arranged iri a far more orderly manner, it is to be noticed
that the provisions of the .1996 Act are clearly aimed at
facilitating and expediting the enforcement of the New
York Convention Awards. Section 3 of the 1961 Act
dealing with a stay of proceedings in respect of matters
E to be referred to arbitration was confined in its
application to "legal proceedings in any court" and the
court had a wider discretion not to stay the proceedings
before it. The corresponding provision in section 45 of
the present Act has a wider application and it covers an
F action before any judicial authority. Further, under
section 45 the judicial authority has a narrower discretion
to refuse to refer the parties to arbitration. Under section
4(1) of the 1961 Act, a foreign award for its enforcement
was first deemed to be an award made on a matter
G referred to arbitration in India. Section 46 of the present
Act dispenses with the provision of sub-section (1) of
section ,4 and resultantly a foreign award is enforceable
in its own right. Section 47 is almost a reproduction of
section 8 except for the addition of the words "before the
H court" in sub-section (1) and an explanation as to what
FUERST DAY LAWSON LTO. v. JINDAL EXPORTS 7
LTD.
is meant by "court" at the end of the section. Section 49 A
corresponds to section 6(1) and section 50 to section
6(2). It is however, a comparison of section 6 of the 1961
Act with section 49 of the present Act that provides a
direct answer to the question under consideration. Under
section 6 of the 1961 Act, the Court on being satisfied that B
the foreign award was enforceable under the Act, would
first order the· award to be filed and then proceed to
pronounce judgment according to the award. The
judgment would lead to a decree against which no appeal
would lie except insofar as the decree was in excess of C
or not in ·accordance with the award. Section 49 of the
present Act makes a radical change in that where the
court is satisfied that the foreign award is enforceable, the
award itself would be deemed to be a decree of the Court.
It, thus, not only omits the procedural formality for the
court to pronounce judgment and a decree to follow on 0
that basis but also completely removes the possibility of
the decree being in excess of, or not in accordance with
the award. Thus, even the limited ·basis on which an
appeal would lie under sub-section (2) of section 6 of the
1961 Act, is taken away. There is, thus, no scope left for E
an appeal against an order ~f the court for the
enforcement of a foreign award. It is for this reason that
section 50(1)(b) provides for an appeal only against an
order refusing to enforce a foreign award under section
48. There can be no doubt that under section 6, except F
on the very limited ground, no appeal including a Letters
Patent Appeal was maintainable against the judgment
and decree passed by the Court under section 6(1). It
would be futile, therefore, to contend that though the
present Act even removes the limited basis on which the G
appeal was earlier maintainable,, yet a Letters Patent
Appeal would lie notwithstanding the limitations· imposed
by section 50 of the Act. The scheme of sections 49 and
50 of the 1996 Act is devised specially to exclude even
the limited ground. on· which an appeal was earlier H
8 SUPREME COURT REPORTS [2011] 11 S.C.R.
A provided for under section 6 of the 1961 Act. The
exclusion of appeal by section 50 is, thus, to be
understood in light of the amendment introduced in the
previous law by section 49 of the Act. [Paras 55, 56, 57,
58, 59) [39-B-C; 48-F-H; 49-A-E; 50-E-H; 51-A-B]
B
2.6. There is another way to look at the matter. It is
seen that the Arbitration Act 1940, from its inception and
right through 2004 (in P.S. Sathappan's case) was held
to be a self-contained code. Now, if Arbitration Act, 1940
C was held to be a self-contained code, on matters
pertaining to arbitration the Arbitration and Conciliation
Act, 1996, which consolidates, amends and designs the
law relating to arbitration to bring it, as much as possible,
in harmony with the UNCITRAL Model must be held only
to be more so. Once it is held that the Arbitration Act is a
D self-contained code and exhaustive, then it must also be
held, that it carries with it "a negative import that only
such acts as are mentioned in the Act are permissible to
be done and acts or things not mentioned therein are not
permissible to be done". In other words, a Letters Patent
E Appeal would be excluded by application of one of the
general principles that where the special Act sets out a
self-contained code the applicability of the general law
procedure would be impliedly excluded. [Paras 60, 72) [51-
C; 61-E-H; 62-A]
F
Orma lmpex Pvt. Ltd. v. Nissai ASB PTE Ltd. (1999) 2
SCC 541; State of West Bengal v. Mis Gourangalal Chatterjee
(1993) 3 SCC 1: 1993 (3) SCR 640; Union of India v.
Mohindra Supply Co. 1962 (3) SCR 497; Vinita M. Khanolkar
G v. Pragna M. Pai & Ors. (1998) 1 SCC 500: 1997 (5) Suppl.
SCR 593; National Sewing Thread Co. Ltd. v. James
Chadwick and Bros. Ltd. AIR 1953 SC 357: 1953 SCR 1028;
Union of India & Ors. v. Aradhana Trading Co. (2002) 4 SCC
447: 2002 (2) SCR 847; Sharda Devi v. State of Bihar (2002)
H 3 SCC 705: 2002 (2) SCR 404; Basant Kumar v. Union of
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 9
LTD.
India (1996) 11 SCC 542: 1996 (6) Suppl. SCR 231; South A
Asia Industries (P) Ltd. v. S.B. Sarup Singh (1965) 2 SCR
756; Subal Paul v. Malina Paul & Anr. (2003) 10 SCC 361:
2003 (1) SCR 1092; P.S. Sathappan v. Andhra Bank Ltd. &
Ors. (2004) 11 SCC 672: 2004 (5) Suppl. SCR 188; Hurrish
Chunder Chewdry v. Kali Sundari Debia ILR (1882) 9 Cal. B
482 (PC); Resham Singh Pyara Singh v. Abdul Sattar (1996)
1 SCC 49: 1995 (5) Suppl. SCR 483; New Kenilworth Hotel
(P) Ltd. v. Orissa State Finance Corpn. (1997) 3 SCC 462:
1997 (1) SCR 395; Chandra Kanta Sinha v. Oriental
Insurance Co. Ltd. & Ors. (2001) 6 SCC 158: 2001 (3) SCR C
759; Gauri Singh v. Ramlochan Singh AIR (35) 1948 Patna
430; Belli Gowderv. Joghi Gowder AIR (38) 1951 Madras 683;
Narbadabai and Ors. v. Natverlal Chunilal Bhalakia & Anr.AIR
1953 Bombay 386; S.N. Srikantia & Co. v. Union of India and
Anr. AIR 1967 Bombay 347 - referred to.
D
3. The conclusion regarding the exclusion of a
letters patent appeal has thus been arrived at in two
different ways; one, so to say, on a micro basis by
examining the scheme devised by sections 49 and 50 of
the 1996 Act and the radical change that it brings about E
in the earlier provision of appeal under section 6 of the
1961 Act and the other on a macro basis by taking into
account the nature and character of the 1996 Act as a
self-contained and exhaustive code in itself. It must be
held that no letters patent appeal will lie against an order F
which is not appealable under section 50 of the
Arbitration and Conciliation Act, 1996. [Paras 73, 74] (62-
B-D]
Case Law Reference:
G
(1999) 2 sec 541 Referred to. Para 8
1993 (3) SCR 640 Referred to. Para 9
1962 (3) SCR 497 Referred to. Para 9
H
10 SUPREME COURT REPORTS [2011) 11 S.C.R.
A 1997 (5) Suppl. SCR 593 Referred to. Para 9
1953 SCR 1028 Referred to. Para 9
2002 (2) SCR 847 - Referred to. Para 10
2002 (2) SCR 404 Referred to. Para 18
B
1996 (6) Suppl. SCR 231 Referred to. Para 18
(1965) 2 SCR 756 Referred to. Para 18
2003 (1) SCR 1092 Referred to. Para 20
c
2004 (5) Suppl. SCR 188 Referred to. Para 22
JLR (1882) 9 Cal. 482 (PC) Referred to. Para 23
1995 (5) Suppl. SCR 483 Referred to. Para 26
D 1997 (1) SCR 395 Referred to. Para 26
2001 (3) SCR 759 Referred to. Para 26
AIR (38) 1951 Madras 683 Referred to. Para 63
E AIR 1953 Bombay 386 Referred to. Para 64
AIR 1967 Bombay 347 Referred to. Para 66
CIVIL APPELLATE JURISDICTION : SLP (Civil) No.
11945 of 2010.
F
From the Judgment & Order dated 11.12.2009 of the High
Court of Delhi at New Delhi in OMP No. 29 of 2003.
WITH
G SLP (C) Nos. 13625, 13626-13629 and 22318-22321 of 2010,
C.A. Nos. 36 of 2010, 5156 and 5157 of 2011.
Dushyant Dave, C.A. Sundaram, Mukul Rohatgi, S.K.
Bagaria, Jaideep Gupta, Debal Kr. Banerji, Sangeeta Bharti,
. Nidhi Minocha (for Subramonium Prasad), Narendra M.
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FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 11
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Sharma, Rohini Musa, Abhishek Sharma, Zafar lnayat, Yogesh A
V. Kotemath, Mallika, Jaiveer Shergill, l?raveen Kumar,
Siddhartha Dave, Vibha Datta Makhija, Jemtiben AO, E.C.
Agrawala, Ramesh Singh, Anne Mathew, Suman Jyoti Khaitan,
Rishi Maheshwari, Ashwani Kumar, Sharmila Upadhyay,
Gagan Gupta, Suresh A. Shroff & Co., S. Niti Dixit, Darpan B
Wadhwa, Vidur Bhatia, Pradeep Misra, Roopa Dayal, Taniya
Khare, Aradhana Patra, AT. Patra (for O.P. Khaitan & Co),
Kush Chaturvedi, Prerna Priyadarshini, Pinaki Addey,
Chiraranjan Addey, Manav Ujla, Bina Gupta, Jayant Kumar
Mehta for the appearing parties. c
The Judgment of the Court was delivered by
AFTAB ALAM, J. 1. Leave granted in SLP (C) No.31068
of 2009 and SLP (C) No.4648 of 2010. · ·
D
2. The common question that arises for consideration by
the Court in this batch of cases is whether an order, though not
appealable under section 50 of the Arbitration and Conciliation
Act, 1996 (hereinafter "1996 Act"), would nevertheless be
subject to appeal under the relevant provision of the Letters E
Patent of the High Court. In other words even though the
Arbitration Act does not envisage or permit an appeal from the
order, the party aggrieved by it can still have his way, by-
passing the Act and taking recourse to another jurisdiction.
3. Mr. C.A. Sundaram, senior advocate, however, who led F
the arguments on behalf of the appellants, would like to frame
the question differently. He would ask whether there is any
provision in the 1996 Act that can be said to exclude the
jurisdiction of the High Court under its Letters Patent either
expressly or even impliedly. He would say that the jurisdiction G
of the High Court under the Letters Patent is an independent
jurisdiction and as long as the order qualifies for an appeal
under the Letters Patent an appeal from that order would be,
undoubtedly, maintainable before the High Court.
H
12 SUPREME COURT REPORTS [2011] 11 S.C.R.
A 4. A correct answer to both the questions would depend
upon how the 1996 Act is to be viewed. Do the provisions of
the 1996 Act constitute a complete code for matters arising out
of an arbitration proceeding, the making of the award and the
enforcement of the award? If the answer to the question is in
B the affirmative then, obviously, all other jurisdictions, including
the letters patent jurisdiction of the High Court would stand
excluded but in case the answer is in the negative then, of
course, the contention of Mr. Sundaram must be accepted.
C 5. The batch presently before the Court originally consisted
of nine cases, out of which SLP (C) No.16908 of 201 O ended
in compromise between the parties.· Of the remaining eight
cases, SLP (C) No.13625 of 2010 and SLP (C) No.11945 of
2010 are unrelated and have been wrongly put in this batch.
These two SLPs are filed against a common judgment passed
D by a single judge of the Delhi High Court insofar as though
allowing the petitioners' application for enforcement of two
foreign awards, the High Court declined to pass any order for
payment of interest on the awarded amounts payable to the
petitioners. These two cases are, therefore, directed to be de-
E tagged and listed separately. This leaves behind six cases. At
the conclusion of hearing, one of the cases, being SLP (C)
No.31067 of 2009 was directed, on the prayer made by, thei
counsel for the petitioner, to be de-linked from the batch and
to be listed separately. It, however, appears that the direction
F was wrongly obtained since that case and another case in the
batch, SLP (C) No.31068 of 2009 arise from a common order
and SLP (C) No.31067 of 2009 would also be fully governed!
by this judgment. Be that as it may, the direction for de-linking1
• is already made and, hence, that case will be separately listed
G and dealt with in due course. Of the remaining five cases four
come from the Delhi High Court and one from the Calcutta High
Court. In SLP (C) No.4648 of 2010 and SLP (C) No.31068 of
2010, the applications filed by the respective respondents in
these cases, for enforcement of the foreign award in their favour
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 13
LTD. [AFTAB ALAM, J.]
were allowed by orders passed by a single judge of the High A
Court. Against the orders of the single judge, the petitioners in
these SLPs filed appeals before the division bench of the High
Court. All the appeals were taken together and dismissed by
a common order as not maintainable. The petitioners have
come before this Court against the order passed by the division B
bench only, on the question of maintainability of their appeals.
Civil Appeal No.36 of 201 O coming from the Calcutta High
Court is opposite of the aforementioned two SLPs coming from
the Delhi High Court. In this case, against an order passed by
a single judge of the High Court, by which he granted relief for C
enforcement of a foreign award, an appeal was preferred
before the division bench of the High Court. The appeal was
admitted but a preliminary objection was raised in regard to
its maintainabmty in view of section 50 of the 1996 Act. The
division bench by order dated May 8, 2007 rejected the
preliminary objection holding that the appeal was maintainable. D
6. In SLP (C) Nos.22318-22321 of 2010 a single judge of
the Delhi High Court dismissed the suit filed by the petitioner
and allowed the application filed by defendant nos.3-5 referring
the parties to arbitration in terms of section 45 of the 1996 Act. E
The petitioner's appeal before the division bench was
dismissed as not maintainable. The SLP (C) Nos. 22318-
22321 of 2010 are filed under Article 136 of the Constitution
challenging orders passed by both the division bench and the
single judge of the High Court. F
7. The petitioner in SLP (C) Nos.13626-13629 of 2010 is
the respondent in SLP (C) No.13625 of 2010 and SLP (C)
No.11945 of 2010 which have been held to be unrelated to the
batch. Against the order passed by a single judge of the High G
Court for enforcement of two foreign awards against it, the
petitioner in SLP (C) Nos.13626-13629 of 2010, first preferred
an.appeal before the division bench of the High Court, but the
appeal was dismissed by the division bench as not
maintainable. The present SLPs are filed challenging both the
H
14 SUPREME COURT REPORTS [2011] 11 S.C.R.
A orders passed by the single judge and the division bench.
8. At the outset Mr. C.A. Sundaram, submitted that the
proper course would be to refer the matter to a larger bench of
three judges. He pointed out that in Orma lmpex Pvt. Ltd. v.
B Nissai A SB PTE Ltd., (1999) 2 SCC 541, the same question
was earlier referred to a bench of three judges of this Court.
The Court, however, did not have the occasion to decide the
case because it was withdrawn following a settlement between
the parties. Mr. Sundaram submitted that though the case does
C not survive, the issue arising in it (which is the same as in this
batch of cases) continues to be alive and hence, following the
referral in Orma lmpex Pvt. Ud. (which was in the form of
'Record of Proceedings' and not an order of the Court!), all
these cases should be ref~red for hearing before a bench of
three judges of this Court. Mr. Dushyant Dave, learned senior
D advocate appearing for the respondents, in some of the cases
in the batch, strongly opposed Mr. Sundaram's submission and
contended that there was no need to refer the cases to any
larger bench.
E 9. In Orma lmpex Pvt. Ltd., the Delhi High Court had taken
the view that against the order passed by a single judge of the
High Court under section 45, refusing to refer parties to
arbitration, no further appeal would lie under section 50 of the
1996 Act. In the special leave petition filed against the order of
F the High Court, a bench of two judges of this Court observed
that the High Court had failed to notice section 10 of the Delhi
High Court Act, 1996 and clause 10 of the Letters Patent which
applies to the Delhi High Court. It further observed that though
. the view taken by the High Court was supported by a two judge
G bench decision of this Court in State of West Bengal v. Mis
Gourangalal Chatterjee, (1993) 3 SCC 1, which in turn had
relied upon an earlier decision of the Court in Union of India v.
Mahindra Supply Co., 1962 (3) SCR 497, a contra view was
taken by the Court in Vinita M. Khanolkar v. Pragna M. Pai &
H Ors., (1998) 1 SCC 500. There, thus, appeared a conflict of
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 15
LTD. [AFTAB ALAM, J.]
decisions on the question. In support of the contra view, the A
division bench also referred to an earlier decision by a three
judge bench of this Court in National Sewing Thread Co. Ltd.
v. James Chadwick and Bros. Ltd., AIR 1953 SC 357.
10. Mr. Dave pointed out that neither the decision in Vinita
8
M. Khanolkar nor the decision in National Sewing Thread Co.
Ltd. was rendered under the provisions of the Arbitration Act;
the former was in the context of section 6(3) of the Specific
Relief Act, 1963 and the latter under the Trade Marks Act, 1940.
He further submitted that after the decisions in Vinita M.
Khanolkar and the referral of Orma lmpex Pvt. Ltd., a three C
judge bench of this Court in Union of India & Ors. v. Aradhana
Trading Co., (2002) 4 sec 447, had the occasion to consider
the same question, as arising in this batch of cases, though not
under the 1996 Act but under the provisions of the Arbitration
Act, 1940 (hereinafter "1940 Act"). In Aradhana Trading Co. D
the Court referred to both the decisions in Vinita M. Khanolkar
and in National Sewing Thread Co. Ltd.; the first it did not follow
and the second it distinguished as having been rendered on a
different set of provisions. Mr. Dave submitted that, thus, the
very foundation on which the referral of Orma lmpex Pvt. Ltd. E
was based, no longer held good.
11. On hearing the two sides, we are of the view that in
the afore-noted facts and circumstances the referral of Orma
lmpex Pvt. Ltd. cannot be said to constitute a binding
F
precedent, especially as the case that was referred no longer
survives. In any event we have heard the two sides at great
length and we see no good reason why this matter should be
referred to a larger bench and not decided by this Court. We,
accordingly, proceed to do so.
G.
12. The question regarding the availability of an appeal
under the relevant clause of the Letters Patent has engaged
the attention of this Court from time to time under different
circumstances and in cases arising under different Acts. We
take note of some of the case.s here that were brought to our H
16 SUPREME COURT REPORTS (2011] 1-1 S.C.R.
A notice by the two sides.
13. In National Sewing Thread Co. Ltd., this Court held
that the judgment of a learned single judge of the Bombay High
Court, on an appeal preferred under section 76 of the Trade
8 Marks Act was subject to appeal under clause 15 of the Letters
Patent of that High .Court. The Court noted the material part of
clause 15 of the Letters Patent of the High Court and section
76 (1) of the Trade Marks Act and observed:
"The Trade Marks Act does not provide or lay down any
c procedure for the future conduct or career of that appeal
in the High Court, indeed S.77 of the Act provides that the
High Court can if it likes make rules in the matter.
Obviously after the appeal had reached the High Court
it has to be determined according to the rules of practice
D and procedure of that Court and in accordance with the
provisions of the charter under which that Court is
constituted and which confers on it power in respect to the
method and manner of exercising that jurisdiction. The
rule is well settled that when c.. statute directs that an
E appeal shall lie to a Court already established, then that
appeal must be regulated by the practice and procedure
of that Court."
(emphasis supplied)
F 14. Taking support for its view from the decisions in (i)
National Telephone Co. Ltd. v. Postmaster-General, (1913)
AC 546, (ii) Adaikappa Chettiar v. Chandresekhara Thevar,
AIR 1948 PC .12 and (iii) Secy. of State for India v. Chelfikani
Rama Rao, AIR 1916 PC 21, the decision in National Sewing
G Thread Co. Ltd. further observed:
"Section 76, Trade Marks Act confers a right of appeal to
the High Court and says nothing more about it. That being
so, the High Court being seized as much of the appellate
H jurisdiction conferred by S. 76 it has to exercise that
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 17
LTD. [AFTAB ALAM, J.]
jurisdiction in the same manner as it exercises its other A
appellate jurisdiction and when such jurisdiction is
exercised by a single Judge, his judgment becomes
subject to appeal under Cl .15 of the Letters Patent there
being nothing to the contrary in the Trade Marks Act."
B
15. The Court held that there was nothing in the provisions
of section 77 of the Trade Marks Act that would debar the High
Court from hearing appeals under section 76, according to the
Rules under which all other appeals are heard or from framing
Rules for the exercise of that jurisdiction under section 108, C
Government of India Act, 1915, for hearing those appeals by
single judges or by division benches. It also negated the
submission that the judgment of the learned single judge would
not be subject to an appeal under clause 15 of the Letters
Patent because it was not delivered pursuant to section 108, D
Government of India Act.
16. In Vinita M. Khanolkar, a bench of two judges of this
Court held that notwithstanding the bar of sub-section (3), an
order passed by a learned single judge of the High Court under
section 6 of the Specific Relief Act would nevertheless be E
subject to appeal under clause 15 of the Letters Patent of the
Bombay High Court. In Vinita M. Khanolkar, this Court put the
power of the High Court under the Letters Patent at the level of
constitutional power of the High Court and went on to observe
as follows: F
"3. Now it is well settled that any statutory provision barring
an appeal or revision cannot cut across the constitutional
power of a High Court. Even the power flowing from the
paramount charter under which the High Court functions
would not get excluded unless the' statutory enactment G
concerned expressly excludes appeals under letters
patent. No such bar is discernible from Section 6(3) of the
Act. It could not be seriously contended by learned counsel
for the respondents that if clause 15 of the Letters Patent
H
18 SUPREME COURT REPORTS [2011] 11 S.C.R.
A is invoked then the order would be appealable.
Consequently, in oi.Jr view, on the clear language of clause
15 of the Letters Patent which is applicable to Bombay
High Court, the said appeal was maintainable as the order
under appeal was passed by learned Single Judge of the
B High Court exercising original jurisdiction of the court. Only
on that short ground the appeal is required to be allowed."
17. As noted above, Vinita M. Khanolkar, was considered
in a later three judge bench decision in Aradhana Trading Co.
c One may not go so far as to say that Aradhana Trading Co.
disapproved Vinita M. Khanolkar wholly but it surely took the
opposite view on the question in the context of section 39 of
the Arbitration Act, 1940.
18. In Sharda Devi v. State of Bihar, (2002) 3 SCC 705,
D a bench of three judges of this Court examined the question
whether a Letters Patent Appeal is maintainable against the
judgment and decree of a single judge of the High Court
passed in an appeal preferred under section 54 of the Land
Acquisition Act, 1894. A bench of two judges before which the
· E case was earlier put up noticed a conflict of decision on the
question. In Baljit Singh v. State of Haryana, bench of two
judges of the Court had held that no Letters Patent Appeal is
maintainable against the judgment of a single judge of the High
Court on an appeal under section 54 of the Land Acquisition
F Act, whereas in B'asant Kumar v. Union of India, (1996) 11
sec 542, a bench of three judges, without adverting to the
decision in Baljit Singh, held that such an appeal is
maintainabl~. The two judge bench, accordingly, referred the
case for hearing before a bench of three judges. The three judge
G bench affirmed the decision in Basant Kumar. It noted that the
decision in Baljit Singh was based on concession made in light
of an earlier decision of this Court in South Asia Industries (P)
·Ltd. v. S.B. Sarup Singh, (1965) 2 SCR 756. The decision in
South Asia Industries was in a case under the Delhi Rent
H Control Act, 1958. In Sharda Devi, the Court pointed out that
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 19
LTD. [AFTAB ALAM, J.]
in South Asia Industries, the -Court had examined sections 39 A
and 43 of the Delhi Rent Control Act and held that a combined
reading of the two sections showed that an order passed by
the High Court in an appeal under section 39 was to be final. It
was held that the provision of finality was intended to exclude
any further appeal. This decision was, thus, based on B
interpretation of sections 39 and 43 of the Delhi Rent Control
Act. Section 54 of the Land Acquisition Act, has no similarity
with sections 39 and 43 of the Delhi Rent Control Act. Hence,
the decision in South Asia Industries had no relevance to
decide the question whether a letters patent appeal is c
maintainable against the judgment passed by a single judge
under section 54 of the Land Acquisition Act. In regard to the
Letters Patent jurisdiction of the High Court, this Court in
Sharda Devi made the following observation in paragraph 9:
"9. A Letters Patent is the charter under which the High D
Court is established. The powers given to a High Court
under the Letters Patent are akin to the constitutional
powers of a High Court. Thus when a LettersPatent grants
to the High Court a power of appeal, against a judgment
of a Single Judge, the right to entertain the appeal would E
not get excluded unless the statutory enactment
concerned excludes an appeal under the Letters Patent."
19. Referring to section 54 of the Land Acquisition Act, the
Court concluded as follows: F
"14 .... Section 26 of the said Act provides that every
award shall be a decree and the statement of grounds of
every award shall be a judgment. By virtue of1he Letters
Patent "an appeal" against the judgment of a Single Judge
of the Higt) Court would lie to a Division Bench. Section 54 G
of the said Act does not exclude an appeal under the
Letters Patent. The word "only" occurring immediately after
the non obstante clause in Section 54 refers to the forum
of appeal. In other words, it provides that the appeal will
H
20 SUPREME COURT REPORTS [2011) 11 S.C.R.
A be to the High Court and not ·to any other court e.g. the
District Court. The term "an appeal" does not restrict it to
only one appeal in the High Court. The term "an appeal"
would take within its sweep even a letters patent appeal.
The decision of the Division Bench rendered in a letters
B patent appeal will then be subject to appeal to the
Supreme Court. Read in any other manner there would be
a conflict between Section 54 and the provision of a
Letters Patent. It is settled law that if there is a conflict,
attempt should be made to harmoniously construe the
c provisions."
20. In Subal Paul v. Malina Paul & Anr., (2003) 10 SCC
361, a bench of three judges of this· Court examined the
question whether a letters patent appeal would lie· against the
judgment of a single judge of a High Court on an appeal filed
D under section 299 of the Indian Succession Act, 1925. Arguing
against the maintainability of a letters patent appeal against the
judgment of the single judge it was contended that the rejection
of the application for probate by the district judge did not give
rise to any decree. Hence, an appeal against such an order
E would be one under section 104 of the Civil Procedure Code
and a further appeal would, therefore, be barred under sub-
section (2) of section 104. This Court did not accept the
submission. It held that the appeal against an order of the
district judge would be under section 299 of the-Indian
F Succession Act. Section 104 of the Code simply recognizes
appeals provided under special statutes; it does not create a
right of appeal as such. Consequently, it does not bar any further
appeal also. As regards the nature of an appeal under the
Letters Patent, the decision in Subal Paul in paragraphs 21
G and 22, observed as follows:
"21. If a right of appeal is provided for under the Act, the
limitation thereof must also be provided therein. A right of
appeal which is provided under the Letters Patent cannot
be said to be restricted. Limitation of a right of appeal, in
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 21
LTD. [AFTAB ALAM, J.]
the absence of any provision in a statute cannot be readily A
inferred. It is now well-settled that the appellate
jurisdiction of a superior court is not tak~n as excluded
simply because the subordinate court exercises its
special jurisdiction. In G.P. Singh's Principles of Statutory
Interpretation, it is stated: s
"The appellate and revisional jurisdiction of superior
courts is not taken as excluded simply because the
subordinate court exercises a special jurisdiction.
The reason is that when a special Act on matters
governed by that Act confers a jurisdiction to an C
established court, as distinguished from a persona
designata, without any words of limitation, then, the
o~dinary incident of procedure of that court including
any general right of appeal or revision against its
decision is attracted." D
22. But an exception to the aforementioned rule is on
matters where the special Act sets out a self-contained
code, the applicability of the general law procedure would
be impliedly excluded. [See Upadhyaya Hargovind E
· Devshanker v. Dhirendrasinh Virbhadrasinhji Solanki
(1988) 2 sec 1r
(emphasis supplied)
21. In paragraph 32 of the judgment, this Court further F
observed as follows:
"32. While determining the question as regards clause 15
of the Letters Patent, the court is required to see as to
whether the order so.ught to be appealed against is a G
judgment within the meaning thereof or not. Once it is held
that irrespective of the nature of the order, meaning thereby
whether int,erlocutory or final, a judgment has been
rendered, clause 15 of the Letters Patent would be
attracted."
H
22 SUPREME COURT REPORTS [2011] 11 S.C.R.
A 22. In P.S. Sathappan v. Andhra Bank Ltd. & Ors., (2004)
11 sec 672, a constitution bench of this Court once again
extensively considered the nature of. the Letters Patent
jurisdiction of the High Court, and the circumstances in which
it would be available and those under which it would be ousted.
B The question that was referred to the Constitution Bench was:
what would be "the effect of the provisions of section 104(2)
of the Code of Civil Procedure, 1908 (hereinafter "CPC") vis-
a-vis clause 15 of the Letters Patent (of the Madras High
Court)"? An application for setting aside the court auction-sale
c was dismissed by the execution court. An appeal against the
order came to the High Court and it was dismissed by a single
judge. Against the order of .the single judge, a letters patent
appeal was filed. The question of maintainability of the appeal
was examined by a full bench of the High Court and the intra-
D court appeal to the division bench was held to be not
maintairiable in view of the provisions of section 104(2) of
CPC. A Constitution Bench of this Court, however, reversed
the decision of the full bench of the High Court and by a majority
of 3:2 held that the letters patent appeal was perfectly
maintainable.
E
23. P.S. Sathappan is actually an authority on the interplay
of section 104 of the Code of Civil Procedure and the Letters
Patent jurisdiction of the High Court. The majority judgment
went into the history of the matter and pointed out that under
F the Civil Procedure Codes of 1877 and 1882 there was a
divergerice of opinion among the different High Courts on the
point whether the finality. attached to orders passed under
section 588 (corresponding to sectioo. 104 of the present
Code) precluded any further appeals, including a letters patent
G appeal. The question, then, came up before the Privy Council
in the case of Hurrish Chunder Chowdry v. Kali Sundari
Debia, ILR (1882) 9 Cal. 482 ( PC). But the decision of the
Privy Council, rather than settling the issue gave rise to further
conflicting decisions by different High Courts in the country. The
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 23
LTD. [AFTAB ALAM. J.]
Bombay. Calcutta and Madras High Courts held that section A
588 did not take away the right of appeal given under the
Letters Patent. On the other hand, the Allahabad High Court took
a different view and held that a letters patent appeal was barred
under section 588 of the Code. In view of this conflict of views.
the legislature stepped in and amended the law. It introduced B
section 4 and section 104 in the Code. Having, thus. put the
controversy in the historical perspective, the Court re{erred to
sections 4 and 104 of the Code and made the following
observation in paragraph 6 of the judgment:
"To be immediately noted that now the legislature provides C
that the provision of this Code will not affect or limit special
law unless specifically excluded. The legislature also
simultaneously saves, in section 104(1), appeals under
"any law for the time being in force". These would include
letters patent appeals." D
(emphasis supplied)
24. The above is really the kernel of the decision in P. S.
Sathappan and the rest of the judgment is only an elucidation
E
of this point.
25. In P. S. Sathappan the constitution bench considered
in some detail the 1962 decision by a bench of four judges of
the Court in Mohindra Supply. Co. (supra) in which the
legislative history of section 104 of the Code was traced out in F
detail and it was shown that by virtue of the saving clause in
section 4 and the express language of section 104 that saved
an appeal as provided by any other law for the time being in
force, a letters patent appeal was not hit by the bar of sub-
section (2) of section 104 of the Code. [Mohindra Supply Co., G
however, was a case under section 39 of the 1940 Act, which
did not contain any provision similar to section 4 of the Code
and hence, in that case the Court held that the finality attached
by sub-section (2) to an order passed under sub-section (1) of
section 39 barred any further appeal, including a letters patent H
24 SUPREME COURT REPORTS [2011] 11 S.C.R.
A appeal.]
26. In P.S. Sathappan, on a consideration of a number of
earlier decisions, the Constitution Bench concluded that till
1996, the unanimous view of all courts was that section 104(1)
B CPC specifically saved letters patent appeals and the bar under
section 104(2) did not apply to letters patent appeals.
Thereafter, there were two decisions in deviation from the
accepted judicial view, one by a bench of two judges of this
Court in Resham Singh Pyara Singh v. Abdul Sattar, (1996)
c 1 SCC 49 and the other by a bench of three judges of this Court
in New Kenilworth Hotel (P) Ltd. v. Orissa State Finance
Corpn., (1997) 3 SCC 462. P.S. Sathappan, overruled both
these decisions and declared that Resham Singh Pyara Singh
and New Kenilworth Hotel (P) Ltd. laid down wrong law. It further
0 pointed out that even after the aforementioned two decisions
this Court had continued to hold that a Letters Patent Appeal
is not affected by the bar of section 104(2) CPC. In this
connection, it referred to Vinita M. Khanolkar (supra), under
section 6 of the Specific Relief Act, Chandra Kanta Sinha v.
Oriental Insurance Co. Ltd. & Ors., (2001) 6 SCC 158, under
E section 140 of the Motor Vehicles Act, 1988, Sharda Devi
(supra), under section 54 of the Land Acquisition Act and Subal
Paul (supra), under section 299 of the Indian Succession Act,
1925 and came to the conclusion that the consensus of judicial
opinion has been that section 104(1) CPC expressly saves the
F letters patent appeal and the bar under section 104(2) CPC
does not apply to letters patent appeals. In paragraph 22 of the
judgment, the Court observed as follows:
"22 .... The view has been that a letters patent appeal
G cannot be ousted by implication but the right of an appeal
under the Letters Patent can be taken away by an express
provision in an appropriate legislation. The express
provision need not refer to or use the word "letters patent"
but if on a reading of the provision it is clear that all further
H appeal_s are barred then even a letters patent appeal would
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 25
LTD. [AFTAB ALAM, J.]
be barred." A
27. Further, analysing the two sub-sections of section
104(2) along with section 4 CPC, this Court in paragraph 30
of the judgment observed as follows:
"30 .... Section 104 must be read as a whole and B
harmoniously. If the intention was to exclude what is
specifically saved in sub-section (1 ), then there had to be •
a specific exclusion. A general exclusion of this nature
would not be sufficient. We are not saying that a general
exclusion would never oust a letters patent appeal. C
However, when section 104(1) specifically saves a letters
patent appeal then the only way such an appeal could be
excluded is by express mention in section 104(2) that a
letters patent appeal is also prohibited ......"
D
28. Mr. Sundaram heavily relied upon this decision.
29. The decisions noticed so far lay down certain oroad
principles that may be stated as follows:
1. Normally, once an appeal reaches the High Court E
it has to be determined according to the rules of
practice and procedure of the High Court and in
accordance with the provisions of the charter under
which the High Court is constituted and which
confers on it power in respect to the method and F
manner of exercising that power.
2. When a statute merely directs that an appeal shall
lie to a court already established then that appeal
must be regulated by the practice and procedure G
of that court.
3. The High Court derives its intra-court appeal
jurisdiction under the charter by which it was
established and its powers under the Letters
Patent were recognized and saved by section 108 H
26 SUPREME COURT REPORTS (2011] 11 S.C.R.
A of the Government of India Act, 1915, section 223
of the Government of India Act, 1935 and finally, by
Article 225 of the Constitution of India. The High
Court, therefore, cannot be divested of its Letters
Patent jurisdiction unless provided for expressly or
B by necessary intendment by some special statute.
4. If the pronouncement of the single judge qualifies
as a "judgment", in the absence of any bar creatied
by a statute either expressly or by necessary
implication, it would be subject to appeal under the
c relevant clause of the Letters Patent of the High
Court.
5. Since section 104(1) CPC specifically saves the
letters patent appeal it could only be excluded by
D an express mention in section 104(2). In the
absence of any express mention in section 104(:2),
the maintainability of a letters patent appeal is
saved by virtue of section 104(1 ).
E 6. Limitation of a right of appeal in absence of any
provision in a statute cannot be readily inferred.
The appellate jurisdiction of a superior court cannot
be taken as excluded simply because a
subordinate court exercises its special jurisdiction.
F 7. The exception to the aforementioned rule is where
the special Act sets out a self-contained code and
in that event the applicability of the general laiw
procedure would be impliedly excluded. The
express provision need not refer to or use the word
G "letters patent" but if on a reading of the provision
it is clear that all further appeals are barred thEm
even a letters patent appeal would be barred.
30. These general principles are culled out from the
H decisions of this Court rendered under section 104 of the CPC
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 27
LTD. [AFTAB ALAM, J.]
and various other Acts, as noted above. But there is another A
set of decisions of this Court on the question under
consideration rendered in the context of section 39 of the 1940
Act. Section 39 of the erstwhile Act contained the provision of
appeal and provided as follows:
8
"39. Appealable orders.-(1) An appeal shall lie from the
following orders passed under this Act (and from no others)
to the Court authorised by law to hear appeals from
original decrees of the Court passing the order:
An order - c
(i) superseding an arbitration;
(ii) on an award stated in the form of a special case;
(iii) modifying or correcting an award; D
(iv) filing or refusing to file an arbitration agreement;
(v) staying or refusing to stay legal proceedings
where there is an arbitration agreement;
E
(vi) setting aside or refusing to set aside an award:
PROVIDED THAT the provisions of this section shall not ·
apply to any order passed by a Small Calise Court.
F
(2) No second appeal shall lie from an order passed in
appeal under this section. but nothing in this section shall
affect or take away any right to appeal to the Supreme
Court."
[Insofar as relevant for the present, section 37 of the 1996 G
Act, is very similar to section 39 of the previous Act as
quoted above.]
31. In Mohindra Supply Co., a bench of four judges of this
Court held that a letters patent appeal against an order passed H
28 SUPREME COURT REPORTS [2011] 11 S.C.R.
A by a single judge of the High Court on an appeal under section
39(1) of the 1940 Act was barred in terms of sub-section (2)
of section 39. This decision is based on the bar against furthEir
appeals as contained in sub-section (2) of section 39 of the
1940 Act and, therefore, it may not have a direct bearing on
B the question presently under consideration.
32. More to the point are two later decisions. In Mis
Gourangalal Chatterjee, a bench of two judges of this Court
held that an order, against which no appeal would lie under
C section 39(1) of the 1940 Act, could not be taken in appeal
before the division bench of the High Court under its Letters
Patent. The same view was reaffirmed by a bench of three
judges of this Court in Aradhana Trading Co.
33. In regard to these two decisions, Mr. Sundaram took
D the position that both Mis Gourangalal Chatterjee and
Aradhana Trading Co. were rendered on section 39 of the
1940 Act, the equivalent of which is section 37 of the 1996 Act.
In view of the two decisions, he conceded that in the event an
order was notappealable under section 37(1) of the 1996 Act,
E it would not be subject to appeal under the ·Letters Patent of
the High Court. He, however, referred to section 50 of the 1996
Act, which is as follows:
"50. Appealable orders.-(1) An appeal shall lie from the
order refusing to-
F
(a) refer the parties to arbitration under section 45;
(b) enforce a foreign award under section 48, to the
court authorised by law to hear appeals from such
G order.
(2) No second appeal shall lie from an order passed in
appeal under this section, but nothing in this section shall
affect or take away any right to appeal to the Supreme
Court."
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 29
LTD. [AFTAB ALAM, J.]
34. Mr. Sundaram submitted that section 50, unlike section·· A
39 of the previous Act and section 37 of the current Act does
not-have the words "(and from no others)" and that, according
to him, made all the difference. He contended that the omission
of the words in parenthesis was significant and it clearly pointed
out that unlike section 37, even though an order was not B
appealable under section 50, it would be subject to appeal
under the Letters Patent of the High Court. At any event the
decisions rendered under section 39 of the 1940 would have
no application in a case relating to section 50 of the 1996 Act.
35. Mr. Dave, in reply submitted that the words "(and from C
no other)" _occurring in section 39 of the 1940 Act and section
37 of the 1996 Act were actually superfluous and seen, thus,
.there would be no material difference between the provisions
of section 39 of the 1940 Act or section 37 of the 1996 Act
and section 50 of the 1996 Act and all the decisions rendered D
on section 39 of the 1940 Act will apply with full force to cases
arising under section 50 of the 1996 Act.
36. The use of round brackets for putting words in
parenthesis is not very common in legislation and this reminds E
us of the painful lament by Meredith, J. of the Patna High Court,
who in 1948 dealing with a case said that "the 1940 Act
contains examples of bad drafting which it would be hard to
beat".
37. According to the New Oxford Dictionary of English. F
1998 edition, brackets are used to enclose words or figures
so as to separate them from the context. The Oxford
Advanced Learner's Dictionary, Seventh edition defines
"bracket" to mean "either of a pair of marks, ( ) placed around
.extra information in a piece of writing or part of a problem in G
mathematics". The New Oxford Dictionary of English, 1998
edition gives the meaning and use of parenthesis as:
"Parenthesis-noun (pl. parentheses) a word, clause, or
sentence inserted as an explanation or afterthought into H
30 SUPREME COURT REPORTS [2011) 11 S.C.I~.
A a passage which is grammatically complete without it, in
writing usually marked off by brackets, dashes, or
commas.
- (usu. Parentheses) a pair of round brackets ( ) used to
8 include such a word, clause, or sentence."
38. The Oxford Advanced Learner's Dictionary, Seventh
edition, defines the meaning of parenthesis as:
"a word, sentence, etc. that is added to a speech or piece
c of writing, especially in order to give extra information. In
writing, it is separated from rest of the text using brackets,
commas or DASHES."
39. The Complete Plain Words by Sir Ernest Gowers,
D 1986 revised edition by Sidney Greenbaum and Janet Whitcut,
gives the purpose of parenthesis as follows:
"Parenthesis
The purpose of a parenthesis is ordinarily to insert an
E illustration, explanation, definition, or additional piece of
information of any sort into a sentence that is logically and
grammatically complete without it. A parenthesis may be
marked off by commas, dashes or brackets. The degree
of interruption of the main sentence may vary from the
F almost imperceptible one of explanatory words in
apposition, to the violent one of a separate sentence
complete in itself."
40. The Merriam Webster Online Dictionary defines
parenthesis as follows:
G
"1 a : an amplifying or explanatory word, phrase, 1:>r
sentence inserted in a passage from which it is usually set
off by punctuation b : a remark or passage that departs
from the theme of a discourse : digression
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 31
LTD. [AFTAB ALAM, J.]
2: interlude, interval A
3: one or both of the curved marks ( ) used in writing and
printing to enclose a parenthetical expression or to group
a symbolic unit in a logical or mathematical expression"
41. The Law Lexicon, The Encyclopaedic Law Dictionary B
by P. Ramanatha Aiyar, 2000 edition, defines parenthesis as
under:
"Parenthesis. a parenthesis is defined to be an
explanatory or qualifying clause, sentence, or paragraph, c
inserted in another sentence, or in course of a longer
passage, without being grammatically connected with it.
(Cent. Dist.)
PARENTHESIS is used to limit, qualify or restrict the
meaning of the sentence with which it is connected, and D
it may be designated by the use of commas, or by a dash,
or by curved lines or brackets [53 Fed.81 (83); 3C, CA
440)."
42. Having regard to the grammatical use of brackets or E
parentheses, if the words, "(and from no others)" occurring in
section 39 of the 1940 Act or section 37 of the 1996 Act are
viewed as 'an explanation or afterthought' or extra information
separate from the main context, then, there may be some
substance in Mr. Dave's submission that the words in F
parentheses are surplusage and in essence the provisions of
section 39 of the 1940 Act or section 37 of the 1996 Act are
the same as section 50 of the 1996 Act. Section 39· of the 1940
Act says no more and no less than what is stipulated in section
50 of the 1996 Act.
G
43. But there may be a different reason to contend that
section 39 of the 1940 Act or its equivalent section 37 ofthe
1996. Act are fundamentally different from section 50 of the
1996 Act and hence, the decisions rendered under section 39
H
32 SUPREME COURT REPORTS [2011] 11 S.C.R
A of the 1940 Act may not have any application to the facts
arising under section 50 of the 1996 Act.
44. But for that we need to take a look at the basic
scheme of the 1996 Act and its relevant provisions. Before the
B coming into force of the Arbitration and Conciliation Act, 1996
with effect from August 16, 1996, the law relating to domestic
arbitration was contained in the Arbitration Act, 1940, which in
turn was brought in place of the Arbitration Act, 1899. Apart
from the Arbitration Act 1940, there were two other enactments
of the same genre. One called the Arbitration (Protocol and
C Convention) Act, 1937 (for execution of the Geneva Convention
Awards) and the other called the Foreign Awards (Recognition
and Enforcement) Act, 1961 (for enforcement of the New York
Convention awards).
D 45. The aforesaid three Acts were replaced by the
Arbitration and Conciliation Act, 1996, which is based on the
United Nations Commission on International Trade Law
(UNCITRAL) Model and is broadly compatible with the "Rules
of Arbitration of the International Chamber of Commerce". The
E Arbitration and Conciliation Act, 1996 that has repealed the
Arbitration Act, 1940 and also the Acts of 1937 and 1Sl61,
consolidates and amends the law relating to domestic
arbitration, internatfonal commercial arbitration, enforcement of
foreign arbitral awards and defines the law relatins1 to
F conciliation and provides for matters connected therewith and
incidental thereto taking into account the UNCITRAL MODEL
law and Rules.
46. The Statement of Objects and Reasons of the
Arbitration and Conciliation Act, 1996 reads as under:
G
"Statement of Objects and Reasons
The law of arbitration in India is at present
substantially contained in three enactments, namely, The
Arbitration Act, 1940, The Arbitration (Protocol and
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 33
LTD. [AFTAB ALAM, J.]
Convention) Act, 1937 and The Foreign Awards A
(R,ecognition and Enforcement) Act, 1961. It is widely felt
that the 1940 Act, which contains the general law of
arbitration, has become outdated. The Law Commission
of India, several representative bodies of trade and
industry and experts in the field of arbitration have B
proposed amendments to this Act to make it more
responsive to contemporary requirements. It is also
recognised that our economic reforms may not become
fully effective if the law dealing with settlement of both
domestic and international commercial disputes remains c
out of tune with such reforms. Like arbitration, conciliation
is also getting increasing worldwide recognition as an
instrument for settlement of disputes. There is, however,
no general law on the subject in India.
2. The United Nations Commission on International Trade D
Law (UNCITRAL) adopted in 1985 the Model Law on
International Commercial Arbitration. The General
Assernbly of the United Nations has recommended that all
countries give due consideration to _the said Model Law,
in view of the desirability of uniformity of the law of arbitral E
procedures and the specific needs of international
commercial arbitration practice. The UNCITRAL also
adopted in 1980 a set of Conciliation Rules. The General
Assembly of the United Nations has recommended the use
of these Rules in cases where the disputes arise in the F
context of international commercial relations and the
parties seek amicable settlement of their disputes by
recourse to conciliation. An important feature of the said
UNCITRAL Model Law and Rules is that they have
harmonised concepts on arbitration and conciliation of G
different legal systems of the world and thus contain
provisions which are designed for universal application.
3. Though the UNCITRAL Model Law and Rules are
intended to deal with international commercial arbitration
H
34 SUPREME COURT REPORTS [2011] 11 S.C.R.
A and conciliation, they could, with appropriate
modifications, serve as a model for legislation on domestic
arbitration and conciliation. The present Bill seeks to
consolidate and amend the law relating to domestic
arbitration, international commercial arbitration,
B enforcement of foreign arbitral awards and to define the
law relating to conciliation, taking into account the said
UNCITRAL Model Law and Rules.
4. The main objectives of the Bill are as under:-
c (i) to comprehensively cover international and
commercial arbitration and conciliation as also
domestic arbitration and conciliation;
(ii) to make provision for an arbitral procedure which
D is fair, efficient and capable of meeting the ne!eds
of the specific arbitration;
(iii) to provide that the arbitral tribunal.gives reasons for
its arbitral award;
E (iv) to ensure that the arbitral tribunal remains within the
limits of its jurisdiction;
(v) to minimise the supervisory role of courts in the
arbitral process;
F (vi) to permit an arbitral tribunal to use mediation,
conciliation or other procedures during the arbitral
proceedings to encourage settlement of disputes;
(vii) to provide that every final arbifral awa·rd is
G enforced in the same manner as if if were a decree
of the court;
(viii) to provide that a settlement agreement reached by
the parties as a result of conciliation proceedings
will have the same status and effect as an arbitral
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 35
LTD. [AFTAB ALAM, J.]
award on agreed terms on the substance of the A
dispute rendered by an arbitral tribunal; and
(ix) to provide that, for purposes of enforcement of
foreign awards, every arbitral award made in a
country to which one of the two international
Conventions relating to foreign arbitral awards to 8
which India is a party applies, will be treated as a
foreign award.
5. The Bill seeks to achieve the above objects."
(emphasis supplied)
c
47. The Preamble of the Arbitration and Conciliation Act,
1996 is as follows:
"PREAMBLE D
WHEREAS the United Nations Commission on
International Trade Law (UNCITRAL) has adopted the
UNCITRAL Model Law on International Commercial
Arbitration in 1985;
E
AND WHEREAS the Genera,I Assembly of the
United Nations has recommended that all countries give
due consideration to the said Model Law, in view of the
desirability of uniformity of the law of arbitral procedures
and the specific needs of international commercial F
arbitration practice;
AND WHEREAS the UNCITRAL has adopted the
UNCITRAL Conciliation Rules in 1980;
AND WHEREAS the General Assembly of the G
United Nations has recommended the use of the said
Rules in cases where a dispute arises in the context of
international commercial relations and the parties seek an
amicable settlement of that dispute by recourse to
36 SUPREME COURT REPORTS [2011) 11 S.C.R.
A conciliation;
AND WHEREAS the said Model Law and 'Rules
make significant contribution to the establishment of a
unified legal framework for the fair and efficient settlement
B of disputes arising in international commercial relations;
AND WHEREAS it is expedient to make law
respecting arbitration and conciliation, taking into account
the aforesaid Model Law and Rules;"
c 48. The new Act is a loosely integrated version of the
Arbitration Act, 1940, Arbitration (Protocol and Convention) Act,
1937 and Foreign Awards (Recognition and Enforcement) Act,
1961. It actually consolidates amends and puts together three
different enactments. But having regard to the difference in the
D object and purpose and the nature of these three enactments,
the provisions relating thereto are kept separately. A mere
glance at the 1996 Act is sufficient to show that under its
scheme the provisions relating to the three enactments are kept
separately from each other. The 1996 Act is divided into four
E parts and it has three schedules at its end. Part I has ten
chapters that contain provisions governing domestic arbitration
and international commercial arbitration. Part II has two
chapters; Chapter I contains provisions relating to the New York
Convention Awards and Chapter II contains provisions relating .
to the Geneva Convention Awards. Part IH of the Act has
F provisions concerning conciliation .. /fJart IV has the
supplementary provisions such as the power of the High Court
to make rules \(section 82), provision for removal of difficulties
(section 83), and the power to make rules (section 84). At the
end there are two repeal and saving sections. Section 85
G repeals the three enactments \
referred to above, subject to the
appropriate saving clause and section 86 repeals Ordinance
27 of 1996, the precursor of the Act, subject to the appropriate
saving clause. Of the three schedules, the first is related to Part
11, Chapter I, i.e., the New York Convention Awards and the
H
..
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 37
LTD. [AFTAB ALAM, J.)
secon~ and the third to Chapter 11, i.e., the Geneva Convention A
Awards.
49. There is a certain similarity between the provisions of
Chapters I and II of Part II but Part I of the Act is vastly different
from Chapters I and II of Part II of the Act. This is quite B
understandable too since Part II deals only with enforcement
of foreign awards (Chapter I, of New York Convention Awards
and Chapter 11, of Geneva Convention Awards) while Part I of
the Act deals with the whole gamut of law concerning domestic
arbitration and international commercial arbitration. It has, C
therefore, a very different and much larger framework than the
two chapt~rs in Part II of the Act.
50. Part I has ten chapters. Chapter I begins with definition
clauses in section 2 that defines, amongst other terms and
expressions, "arbitration", "arbitration agreement", "arbitral D
award", etc. Chapter I also contains some "General Provisions"
(sections 3-6). Chapter II contains provisions relating to
"Arbitration Agreement" (sections 7-9). Chapter Ill contains
provisions relating to "Composition of Arbitral Tribunal"
(sections 10-15). Chapter IV deals with the "Jurisdiction of E
Arbitral Tribunals" (sections 16-17). Chapter V lays down
provisions concerning "Conduct of Arbitral Proceedings"
(sections 18-27). Chapter VI deals with "Making of Arbitral
Award and Termination of Proceedings" (sections 28-33).
Chapter VII has only one section, i.e., section 34 that provides F
. "Recourse against Arbitral Award". Chapter VIII deals with
"Finality and Enforcement of Arbitral Awards" (sections 35-36).
Chapter IX provides for "Appeals" (section 37 which is akin to
section 39 of the 1940 Act). Chapter X contains the
"Miscellaneous" provisions (sections 38-43). G
51. It is also evident that Part I and Part II of the Act are
quite separate and contain provisions that act independently
in their respective fields. The opening words of section 2, i.e.
the definition clause in Part I, make it clear that meanings
H
38 SUPREME COURT REPORTS [2011] 11 S.C.R.
A assigned to the terms and expressions defined in that section
are for the purpose of that part alone. Section 4 which deals
with waiver of right to object is also specific to Part I of the
Act. Section 5 dealing with extent of judicial intervention 1s also
specific to Part I of the Act. Section 7 that defines "arbitration
B agreement" in considerable detail also confines the meaning
of the term to Part I of the Act alone. Section 8 deals with the
power of a judicial authority to refer parties to arbitration where
there is an arbitration agreement and this provision too is
relatable to Part I alone (corresponding provisions are
c independently made in sections 45 and 54 of Chapter I and II.
respectively of Part II). The other provisions in Part I by their
very nature shall have no application insofar as the two
chapters of Part II are concerned.
52. Once it is seen that Part I and Part II of the Act are
D quite different in their object and purpose and the respective
schemes, it naturally follows that section 37 in Part I (analogous
to section 39 of the 1940 Act) is not comparable to section
50 in Part II of the Act. This is not because, as Mr. Sundaram
contends section 37 has the words in parentheses "and from
E no others" which are not to be found in section 50 of the Act.
Section 37 and section 50 are not comparable because they
belong to two different statutory schemes. Section 37
containing the provision of appeal is part of a much larger
framework that, as seen above, has provisions for the complete
F range of law concerning domestic arbitration and international
commercial arbitration. Section 50 on the other hand contains
the provision of appeal in a much limited framework, concerned
only with the enforcement of New York Convention awards. In
one sense, the two sections, though each containing the
G appellate provision belong to different statutes.
53. Having come to this conclusion, it would appear that
the decisions rendered by the Court on the interplay between
section 39 of the 1940 Act and the Letters Patent jurisdiction
of the High Court shall have no application for deciding the
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 39
LTD. [AFTAB ALAM, J.]
question in hand. But that would be only a superficial view and A
the decisions rendered under section 39 of the 1940 Act may
·still give the answer to the question under consideration for a
very basic and fundamental reason.
54. However, before going into that it will be useful to take
B
another look at the provisions of Chapter I of Part II of the Act.
We have so far seen the provisions of Chapter I of Part II of
the Act in comparison with those of Part I of the 1996 Act. It
would also be relevant to examine it in comparison with the
provisions of its precursor, the Foreign Awards, Recognition C
and Enforcement Act, 1961 and to see how far the earlier Act
is consolidated, amended and harmonised and designed for
universal application.
55. The provisions of Chapter I of Part II of the 1996 Act
along with the provisions of the Foreign Awards, Recognition D
and Enforcement Act, 1961, insofar as relevant for the present
are placed below in a tabular form:
THE FOREIGN AWARDS PART II
(RECOGNITION AND ENFORCEMENT OF
E
ENFORCEMENT) ACT, CERTAIN FOREIGN
1961 AWARDS
CHAPTER I
NEW YORK CONVENTION F
AWARDS
2. Definition.-ln this Act, 44. Definition.-ln this
unless the context otherwise Chapter, unless the context
requires, "foreign award" otherwise requires, "foreign G
means an award . on award" means an arbitral
differences between persons award on differences· between
arising out of legal persons arising out of legal
relationships, whether relationships, whether
contractual or not, considered H
40 SUPREME COURT REPORTS [2011] 11 S.C.R.
A contractual or not, as commercial under the law
considered as commercial in force in India, made on or
under the law in force in India, after the 11th day of
made on or after the 11th day October, 1960 -
of October, 1960 -
8 (a) in pursuance of an (a) in pursuance of an
agreement in writing for agreement in writing for
arbitration to which the arbitration to which the
Convention set forth in Convention set forth in
the Schedule applies, the First Schedule
c and applies, and
(b) in one of such territories (b) in one of such territories
as the Central as the Central
Government being Government, being
satisfied that reciprocal satisfied that reciprocal
D provisions have been provisions have been
made, may, by made may, by
notification in the Official notification in the Official
Gazette, declare to be Gazette, declare to be
territories to which the territories to which the
E said Convention said Convention applies.
applies.
3. Stay of proceedings in
respect of matters to be
F referred to arbitration.-
Notwithstanding anything
contained in the Arbitration
Act, 1940 (10 of 1940), or in
the Code of Civil Procedure,
G 1908 (5of1908), if any party
to an agreement to which 45. Power of judicial
Article II of the Convention set authority to refer parties to
forth in the Schedule applies, arbitration.-
on any person claiming Notwithstanding anything
thrbugh or under him contained in Part I or in the
H I
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 41
LTD. [AFTAB ALAM, J.] •
commences any legal Code of Civil Procedure, A
proceedings in any court 1908 (5 of 1908), a judicial
against any other party to the authority, when seized of an
agreement or any person action in a matter in respect
claiming through or under him of which the parties have
in respect of any matter made an agreement B
agreed to be referred to referred to in section 44,
arbitration in such shall, at the request of one of
agreement, any party to such the parties or any person
legal proceedings may, at claiming through or under
any time after appearance him, refer the parties to c
and before filing a written arbitration, unless it finds
statement or taking any other that the said agreement is
step in the proceedings, null and void, inoperative or
apply to the court to stay the incapable of bring
proceedings and the court, performed. D
unless satisfied that the
agreement is null and void,
inoperative or incapable of
being performed or that there
is not, in fact, any dispute E
between the parties with
46. When foreign award
regard to the matter agreed
binding.-Any foreign award
to be referred, shall make an
which would be enforceable
order staying the
under this Chapter shall be
proceedings.
treated as binding for all F
4. Effect of foreign purposes on the persons as
awards.-(1) A foreign between whom it was made,
award shall, subject to the and may accordingly be
provisions of this Act, be relied on by any of those
enforceable in India as if it persons by way of defence, G
were an award made on a set off or otherwise in any
matter referred to arbitration legal proceedings in India
in India. and any references in this
Chapter to enforcing a
(2) Any foreign award which
foreign award shall be H
42 SUPREME COURT REPORTS [2011] 11 S.C.R.
A would be enforceable under construed as inclu_ding
this Act shall be treated as references to relying on an
binding for all purposes on award
the persons as between
whom it was made, and
L may accordingly be relied on
by any of those persons by
way of defence, set off or
otherwise in any legal
proceedings in India and 47. Evidence.-(1) The party
applying for the enforcement
c any references in this Act to
of a foreign award shall, at the
enforcing a foreign award
shall be construed as time of the application,
including references to produce before the court -
relying on an award.
D (a) the original award or a
5. Filing of foreign award in
copy thereof, duly
court.-(1) Any person
authenticated in the
interested in a foreign award
manner required by the
may apply to any court
law of the country in which
having jurisdiction over the
E it was made;
subject-matter of the award
that the award be filed in (b) the original agreement for
court. arbitration or a duly
certified copy thereof; and
(2) The application shall be
in writing and shall be (c) such evidence as may be
F numbered and registered as necessary to prove that
a suit between the applicant the award is a foreign
as plaintiff and the other award.
parties as defendants.
(3) The court shall direct (2) If the award or agreement
G
notice to be given to the to be produced under sub-
parties to the arbitration, section (1) is in a foreign
other than the applicant, language, the party seeking to
requiring them to show enforce the award shall
cause, within a time
H
FUERST DAY LAWSON LTD. v JINDAL EXPORTS 43
LTD. [AFTAB ALAM, J.]
specified why the award produce a translation into A
should not be filed. English certified as correct
by a diplomatic or consular
6. Enforcement of foreign agent of the country to which
award.-(1) Where the court that party belongs or certified
1s satisfied that the foreign as correct in such other B
award is enforceable under manner as may be sufficient
this Act. the court shall order according to the law in force
the award to be filed and in India.
shall proceed to pronounce
judgment according to the
award. Explanat1on.-ln this c
section and all the following
(2) Upon the judgment so
sections of this Chapter,
pronounced a decree shall
"Court" means the principal
follow, and no appeal shall
Civil Court of original
lie. from such decree except D
jurisdiction in a district, and
in so far as the decree is in
includes the High Court in
excess of or not in
exercise of its ordinary
accordance with the award.
original civil jurisdiction,
7. Conditions for having jurisdiction over the
enforcement of foreign subject-matter of the award E
awards.- (1) A foreign if the same had been the
award may not be enforced subject-matter of a suit, but
under this Act- does not include any civil
court of a grade inferior to
(a) if the party against whom
such principal Givil Court, or F
it is sought to enforce the
any Court of Small Causes.
award proves to the court
dealing with the case
that-
(i) the parties to the 48. Conditions for G
agreement were enforcement of foreign
under the law awards.-(1) Enforcement of
applicable to them, a foreign award may be
under some refused, at the request of the
incapacity, or the party against whom it Is
H
44 SUPREME COURT REPORTS [2011] 11 S.C.R.
A said agreement is invoked, only if that party
not valid under the furnishes to the court proof
law to which the that-
parties have (a) the parties to the
subjected it, or agreement referred to in
B failing any indication section 44 were, under the
thereon, under the law applicable to them,
law of the country under some incapacity or
where the award the said agreement is not
was made; or valid under the law to
c (ii) the party was not which the parties have
given proper notice subjected it or, failing any
of the appointment indication thereon, under
of the arbitrator or of the law of the country
the arbitration where the award was
D proceedings or was made; or
otherwise unable to (b) the party against whom the
present his case; or award is invoked was not
(iii) the award deals with given proper notice of the
questions not appointment of the
E referred or contains arbitrator or of the arbitral
decisions on proceedings or was
matters beyond the otherwise unable to
scope of the present his case; or
agreement: (c) the award deals with a
F Provided that if the difference not
decisions on contemplated by or not
matters submitted falling within the terms 1of
to arbitration can be the submission to
separated from arbitration, or it contains
G those not submitted, decisions on matters
that part of the beyond the scope of the
award which submission to arbitration:
contains decisions
on matters Provided that, if the
submitted to decisions on matter
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 45
LTD. [AFTAB ALAM, J.)
arbitration may be submitted to arbitration A
enforced; or can be separated from
(iv) the composition of those not so submitted,
the arbitral authority that part of the award
or the arbitral which contains
procedure was not in decisions on matters B
accordance with the submitted to arbitration
agreement of the may be enforced; .or
parties or failing such (d) the composition of the
agreement, was not arbitral authority or the
in accordance with arbitral procedure was c
the law of the country not in accordance with
where the arbitration the agreement of the
took place; or parties, or, failing such
(v) the award has not yet agreement, was not in
become binding on accordance with the law D
the parties or has of the country where the
been set aside or arbitration took place; or
suspended by a (e) the award has not yet
competent authority become binding on the
of the country in parties, or has been set E
which, or under the aside or suspended by
law of which, that a competent authority of
award was made; or the country in which, or
under the law of which,
that award was made. F
(b) if the court dealing with
the case is satisfied (2) Enforcement of an
that- arbitral award may also be
refused if the Court finds
(i) the subject-matter of
that-
the difference is not
G
capable of (a) the subject-matter of the
settlement by difference is not
arbitration under the capable of settlement
law of India; or by arbitration under the
lai,,v of India; or
(ii) the enforcement of H
46 SUPREME COURT REPORTS [2011] 11 S.C.R.
A tne awara w111 oe (b) the enforcement of the
contrary to public award would be contrary
policy. to the public policy of
India.
(2) If the court before which Explanation .-Without
B prejudice to the generality of
a foreign award is sought to
be relied upon is satisfied clause (b) of this section, it is
that an application for the hereby declared, for the
setting aside or suspension avoidance of any doubt, that
of the award has been made an award is in conflict with
C to a competent authority the public policy of India if
referred to in sub-clause (v) the making of the award was
of clause (a) of sub-section induced or affected by fraud
(1), the court may, if it deems or corruption.
proper, adjourn the decision
D on the enforcement of the
(3) If an application for the
award and may also, on the
setting aside or suspension
application of the party
of the award has been
claiming enforcement of the
made to a competent
award, order the other party
authority referred to in clause
E to furnish suitable security.
(e) of sub-section (1) the
8. Evidence.-(1) The party Court may, if it considers it
applying for the enforcement proper, adjourn the decision
of a foreign award shall, at on the enforcement of the
the time of the application, award and may also, on the
F application of the party
produce-
claiming enforcement of the
(a) the original award or a award, order the other party
copy thereof, duly to give suitable security.
authenticated in the
G manner required by the
law of the country in 49. Enforcement of foreign
which it was made; awards.-Where the Court
(b) the original agreement is satisfied that the foreign
for arbitration or. a duly award is enforceable under
H certified copy thereof;
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 47
LTD. [AFTAB ALAM, J.)
and this Chapter, the award shall A
(c) such evidence as may · be deemed to be a decree of
be necessary to prove that Court.
that the award is a
foreign award.
50. Appealable orders.-(1) B
(2) If the award or agreement An appeal shall lie from the
requiring to be produced ,order refusing to -
under sub-section (1) is in a
(a) refer the parties to
foreign language, the party
arbitration under section
seeking to enforce the
award shall produce a
45; c
translation into English (b) enforce a foreign award
certified as correct by a under section 48,
diplomatic or consular agent to the court authorised by law
of the country to which that to hear appeals from such
party belongs or certified as order. D
correct in such other manner
as may be sufficient
according to the law in force
in India.
9. Saving.-Nothing in this (2) No second appeal shall E
Act shall- lie from an order passed in
appeal under this section, but
(a) prejudice any rights
nothing in this section shall
which any person would
affect or take away any right to
have had of enforcing in
appeal to the Supreme Court. F
India of any award or of
availing himself. in India
of any award if this Act 51. Saving.-Nothing in this
had not been passed; or Chapter shall prejudice any
(b) apply fo any award rights which any person would G
made on an arbitration have had of enforcing in India
agreement governed by of any award or of availing
the law of India. himself in India of any award
if this Chapter had not been
10. Repeal.-The.Arbitration enacted.
H
48 SUPREME COURT REPORTS [2011) 11 S.C.R.
A (Protocol and Convention) 52. Chapter II not to apply.-
Act, 1937 (6 of 1937), shall Chapter II of this Part shall not
cease to have effect in apply in relation to foreign
relation to foreign awards to awards to which this Chapter
which this Act applies. applies.
B
11. Rule making power of the
High Court.-The High Court
may make rules consistent
with this Act as to-
e (a) the filing of foreign
awards and all
proceedings consequent
thereon or incidental
thereto;
D (b) the evidence which must
be furnished by a party
seeking to enforce a
foreign award under this
Act; and
E (c) generally, all proceedings
in court under this Act.
56. A comparison of the two sets of provisions would
show that section 44, the definition clause in the 1996 Act is
F a verbatim reproduction of section 2 of the previous Act (but
for the words "chapter" in place of "Act", "first schedule" in
place of "schedule" and the addition of the word "arbitral" before
the word "award" in section 44). Section 45 corresponds to
section 3 of the previous Act. Section 46 is a verbatim
G reproduction of section 4(2) except for the substitution of the
word "chapter" for "Act". Section 47 is almost a reproduction
of section 8 except for the addition of the words "before the
court" "in sub-section (1)" and an explanation as to what is
meant by "court" in that section. Section 48 corresponds to
H section 7; section 49 to section 6(1) and section 50 to section
FUERST-DAY LAWSON LTD. v. JINDAL EXPORTS 49
LTD. [AFTAB ALAM, J.]
6(2). Apart from the fact that the provisions are arranged in a A
far more orderly manner, it is to be noticed that the provisions
of the 1996 Act are clearly aimed at facilitating and expediting
the enforcement of the New York Convention Awards. Section
3 of the 1961 Act dealing with a stay of proceedings in respect
of matters to be referred to arbitration was confined in its B
application to "legal proceedings in any court" and the court
haa a wider discretion not to stay the proceedings before it.
The corresponding provision in section 45 of the present Act
has a wider application and it covers an action before any
judicial authority. Further, under section 45 the judicial authority c
has a narrower discretion to refuse to refer the parties to
arbitration. Under section 4(1) of the 1961 Act, a foreign award
for its enforcement was first deemed to be an award made on
a matter referred to arbitration in India. Section 46 of the present
Act dispenses with the provision of sub-section (1) of section D
4 and resultantly a foreign award is enforceable in its own
right. Section 47 is almost a reproduction of section 8 except
for the addition of the words "before the court" in sub-section
(1) and an explanation as to what is meant by "court" at the
end of the section. Section 49 corresponds to section 6(1)
and section 50 to section 6(2). It is however, a comparison of E
section 6 of the 1961 Act with section 49 of the present Act
that would be of interest to us and that provides a direct answer
to the question under consideration. As the comparison of the
two sections is of some importance, the two sections are once
again reproduced here: F
The Foreign Awards (Recognition and Enforcement) Act,
1961
"6. Enforcement of foreign award.-(1) Where the court is G
satisfied that the foreign award is enforceable under this
Act, the court shall order the award to be filed and shall
proceed to pronounce judgment according to the award.
(2) Upon the judgment so pronounced a decree shall follow,
H
50 SUPREME COURT REPORTS [2011] 11 S . C.R.
A and no appeal shall lie from such decree except in_ so far
as the decree is in excess of or not in accordance With
the award."
The Arbitration and Conciliation Act, 1996
B "49. Enforcement of foreign awards.-Where the Court is
satisfied that the foreign award is enforceable under this
Chapter, the award shall be deemed to be a decree of that
Court."
c 57. Under section 6 of the 1961 Act, the Court on being
satisfied that the foreign award was enforceable under the Act,
w9ul~ first order the award to be filed and then proceed to
pronounce judgment according to the award. The judgment
would lead to a decree against which no appeal would lie
0 except insofar as the decree was in excess of or not in
accordance with the award.
58. Section 49 of the present Act makes a radical change
in that where the court is satisfied that the foreign award is
enforceable, the award itself would be deemed to be a decree
E of the Court. It, thus, not only omits the procedural formality for
the court to pronounce judgment and a decree to follow on that
basis but also completely removes the possibility of the
decree being in excess of, or not in accordance with the
.award. Thus, even the limited basis on which an appeal would
F lie under sub-section (2) of section 6 of the 1961 Act, is taken
away. There is, thus, no scope left for an appeal against an
order of the court for the enforcement of a foreign award. It is
for this reason that section 50(1 )(b) provides for an appeal only
against an order refusing to enforce a foreign award under
G section 48.
59. There can be no doubt that under section 6, except on
the very limited ground, no appeal including a Letters Patent
Appeal was maintainable _against the judgment and decree
H passed by the Court under section 6(1). It would be futile,
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 51
LTD. [AFTAB ALAM, J.]
therefore, to contend that though the present Act even removes A
the limited basis on which the appeal was earlier maintainable,
yet a Letters Patent Appeal would lie notwithstanding the
limitations imposed by section 50 of the Act. The scheme of
sections 49 and 50 of the 1996 Act is devised specially to
exclude even the limited ground on which an appeal was earlier B
provided for under section 6 of the 1961 Act. The exclusion of
appeal by section 50 is, thus, to be understood in light of the
amendment introduced in the previous law by section 49 of the
Act.
60. There is another way to look at the matter. It will be
c
illuminating to see how the courts viewed the Arbitration Act,
1940 shortly after it was enacted and even while the previous
law, the Arbitration Act, 1899 coupled with the Schedule 2 of
the Code of Civil Procedure was still fresh in the courts' mind. D
In Gauri Singh v. Ramlochan Singh, AIR (35) 1948 Patna 430,
the plaintiff had filed a suit for an order for filing an arbitration
award and preparing a decree of the court on that basis. The
award was in writing and it was also registered on the.
admission of the arbitrators but the award was made not on
the basis of any arbitration agreement in writing but on an oral E
reference. Before the division bench of the Patna High Court,
the question arose regarding the maintainability of the suit.
Agarwala, C.J. in a brief order held that Chapter II of the Act
would only apply when the agreement was in writing. In other
words, the existence of an "arbitration agreement" i.e. an F
.
agreement in writing, was the foundation of the court's
jurisdiction to direct the arbitrators, under section 14(2), to
cause the award to be filed in court. But Meredith, J. examined
the matter in greater detail. He considered the question,
whether the Act of 1940 was exhaustive or whether it related G
only to awards following arbitration agreements within the
meaning of the Act. The case of the plaintiff was that there was
an oral reference to arbitration. Such an oral reference was
perfectly valid and so was the award upon it. But it did not
H
52 SUPREME COURT REPORTS [2011] 11 S.C.R.
A come within the scope of the Act. The award could, therefore,
be enforced by an ordinary suit under the Code of Civil
Procedure. Rejecting the submission, in paragraphs 20, 21 and
22 of the judgment, Meredith, J. observed as follows:
"20 ...... It may be regarded as settled that, so far as Sch.2,
B
Civil P.C .. and the Arbitration Act of 1899 were concerned,
an award based upon an oral submission or reference to
arbitration was not touched, but was perfectly legal and
valid, and the award could be enforced by suit, though not
by the special procedure under the provisions of the Civil
c P.C .. or the 1899 Act. That Act was regarded as not
exhaustive even in the limited, areas where it was
applicable ......
21. This view was also taken by the Madras Higt:i Court in
D Ponnamma v. Marappudi Kotamma [19 A.LR. 1932 Mad.
745], and also in our own High Court in Ramautar Sah v.
Langat Singh, A.l.R. 1931 Pat. 92. The view there taken
was that there is nothing in law which requJres a
submission of the dispute between the parties to arbitration
E to be inwriting. A parole submission is a legal submission
to arbitration.
22. Has the position been altered by the Act of 1940? In
my opinion it has. The Act of 1899 was described as "An
Act to amend the law relating to arbitration", but the Act of
F 1940 is headed as "An Act to consolidate and amend the
law relating to arbitration", and the preamble says
"whereas it is expedient to consolidate and amend the law
relating to arbitration in British India". It is an Act to
consolidate the arbitration law. This suggests that it is
G intended to be comprehensive and exhaustive ....... "
61. Making reference to sections 4 7, 26 and 30 of the 1940
Act, in paragraph 26 of the judgment, His Lordship concluded
as follows:
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 53
LTD. [AFTAB ALAM, J.]
"26. I think I am justified in holding, in view of these A
provisions, that the Act was intended to bl:l exhaustive of
the law and procedure relating to arbitration. I cannot
imagine that the words "arbitrations" and "awards" could
have been used in such specific provisions without more,
speciaUy having regard to the definition of award, if it was B
intended to leave it open to the parties to an award based
upon an oral submission to proceed to enforce it or set it
aside by proceedings by way of suit altogether outside the
Act. Let us take it then that the Act intended that there
should be no such proceedings." c
62. In paragraph 33, he further said:
"If then, as I have held, the Act is intended to be exhaustive,
and contains n·o provisions for the enforcement of an
award based upon an oral submission, the only possible D
conclusion is that the Legislature intended that such an
award should not be enforceable at all, and that no such
suit should /ie." ·
63. In Belli Gowder v. Joghi Gowder, AIR (38) 1951 E
Madras 683, Viswanatha Sastri, J. took the same view on a
case very similar in facts to the case in the Patna decision. In
paragraph 2 of the judgment, Sastri, J. observed as follows:
"2. The first point argued by the applt's learned advocate
is that the suit is one to enforce an award given on oral F
reference or submission to arbitration and is not
maintainable by reason of the provisions of the Arbitration
Act, 1940. It is common ground that there was no written
submission to the panchayatdars. Prior to the enactment
of the Arbitration Act of 1940 it had been held by this and G
other H. Cts that there was nothing in the Arbitration Act
of 1899 or in Sec. 89 and schedule 2 of the C. P. C. of
1908 rendering an oral agreement to refer to arbitration
invalid. A parole submission was held to be a legal
· submission to arbitration and an award passed on an oral H
•
54 SUPREME COURT REPORTS [2011] 11 S.C.R.
A
reference was held to be valid and enforceable by a suit
though not by the special procedure prescribed by Sch 2,
C. P. C. or the Arbitration Act of 1899 ....
. . . . The question whether it was intended merely to make
B awards on oral submissions unenforceable under the
procedure of the Arbitration Act or to make them invalid
and unenforceable altogether, would depend to a large
extent on whether the Act is exhaustive of the law of
arbitration. I am inclined to think that it is. I therefore hold
c that an award passed on oral submission can neither be
filed and made a rule of Ct under the Act, nor enforced
apart from the Act. The same opinion has been express;ed
in 'Gauri Singh v. Ramlqchan Singh', AIR (35) 1948 Pat
430: (29 PLT 105)."
D
64. In Narbadabai and Ors. v. Natver/al Chuni/al Bha/akia
& Anr., AIR 1953 Bombay 386, a division bench of the Bombay
High Court went a step further and held that an arbitration
award could 011Jy be enforced in terms of section 17 of the
Arbitration Act and a suit filed for enforcement of an award was
E not maintainable. Chagla, C.J. speaking for the court, in
paragraph 5 of the judgment, held and observed as follows:
"5. Whatever the law on the subject may have been prior
to the Indian Arbitration Act 10of1940, it is clear that when
F this Act was passed, it provided a self-contained law with
regard to arbitration. The Act was both a consolidating and
amending law. The main object of the Act was to expedite
and simplify arbitration proceedings and to obtain finality;
and in our opinion when we look at the various provisions
G of the Arbitration Act, it is clear that no suit can be
maintained to enforce an award made by arbitrators and
an award can be enforced only by the manner and
according to the procedure laid down in the Arbitration Act
itself. Section 14 deals with signing and filing of the award.
Section 15 deals with the power of the Court to modify the
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 55
LTD. [AFTAB ALAM, J.]
award in cases set out in that section and Section 16 deals A
with the power of the Court to. remit the award. Then we
come to S.17 and that provides that
"Where the Court sees no cause to remit the award
or any of the matters referred to arbitration for 8
reconsideration or to set aside the award the Court
shall, after the time for making an application to set
aside the award has expired, or such application
having been made, after refusing it, proceed to
pronounce judgment according to the award, and C
upon the judgment so pronounced a decree shall
follow, and no appeal shall lie from such decree
except on the ground that it is in excess of, or not
otherwise in accordance with the award."
Therefore, Section 17 lays down the procedure by which D
a decree can be obtained on an award. T~e Act gives the
· right to the parties to challenge the award J;>y applying for
setting aside the award after the award is filed und~r
Section 14, but if that right is not availed of or if the\
application is dismissed and the Court has not remitted E
the award, then the Court has to pronounce judgment
. according to the award, and upon ·the fudgment so
pronounced a decree has to follow. Mr. Desai does not
dispute, as indeed he cannot, that when the award was
published by the arbitrators, he could have followed the F
procedure laid down in the Arbitration Act and could have
applied for judgment under Section 17. But fv1r. Desai
contends that Section 17 does not preclude a party from
filing a suit to enforce the award. Mr. Desai says that
Section 17 gives a party a summary remedy to obtain G
judgment upon the award but that summary remedy does
not bar a suit. ... "
65. He, then, considered sections 31 and 32 of the Act
and came to hold as follows: ·
H
56 SUPREME COURT REPORTS [2011] 11 S.C.R.
A "6 .... Mr. Desai is undoubtedly right that before the Act of
1940 the view was taken that an award did not lose its
efficacy merely because it was not filed and no. action was
taken on it by proceedings under the arbitration law. But
the question is whether that view is possible after the
B Arbitration Act came into force and the Legislature1
enacted S.32. Therefore, with respect, we agree with the
view taken by the Madras High Court in -'Moolchand v.
Rashid Jamshed Sons & Co.', (('46) AIR 1946 Mad. 346]
and the view taken by the Patna High Court in-
c 'Ramchander Singh v. Munshi Mian [('42) AIR 1942 Born
101]., & the view taken by the Punjab High Court in -
'Radha Kishen v. Ganga Ram [('51) A~R 1951 Punj 121].
7. The result, therefore, is that the plaintiff cannot maintain
this action to enforce the award ...... Therefore, if we are
D right in the view we take as to the interpretation of Section
32, then it is clear that Shah J. with respect, had no
jurisdiction to try a suit which in substance and in effect
was a suit to enforce an award. The result, therefore, is
that the suit must fail on the preliminary ground that the suit
E is not maintainable, the suit being one to enforce an award'
duly given by arbitrators appointed by the parties and also
because the award deals with the very disputes which are
the subject-matter of the suit. .... "
F 66. In S.N. Srikantia & Co. v. Union oflndia and Anr., AIR
1967 Bombay 347, the question that arose for consideration
was whether a court has the power to grant interest on the
principal sum adjudged by an award from the date of the award
till payment. The plaintiff in the case claimed that the court
G should award interest in the principal sum adjudged by the
award at a,certain rate from the date of the award till the date
of the decree, and further interest on the said principal sum at
another rate from the date of the decree till payment. The
plaintiffs claim was resisted on the plea that under section 29
of the 1940 Act, interest on the principal sum adjudged by an
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 57
LTD. [AFTAB ALAM, J.]
award could not be granted from the date of the award till the A
passing of the decree. It was contended on behalf of the
plaintiff that section 29 was merely an enabling provision but
that cannot stand in the way of the court in awarding interest
for the prior period, namely, from the date of the award onwards
till the passing of the decree. Tulzapurkar, J., (as his Lordship B
then was) referred to the earlier decisions of the Bombay High
Court in Narbadabai and relying upon the decisions of Patna
High Court in Gauri Singh and Madras High Court in Belli
Gowder held an observed as follows:
c
"I may mention that a contention was raised in that case
that though Section 17 of the Act laid down the procedure
by which a decree could be obtained on an award .that
Section gave a summary remedy to a party to an award
for a judgment upon an award, but that such summary D
remedy did not bar (a suit to enforce an award. This
contention was negatived by this Court and it was held that
for enforcing an award the procedure laid down in the Act
itself could alone be availed of by a party to the award. It
is no doubt true that Section 32 of the Act was referred
to, which expressly barred suits "for a decision upon the E
existence, effect or validity of an award" and it was held
that the expression "effect of the award" was wide enough,
a
to cover suit to enforce an award. At the same time this
Court did take the view that since the Act was a self-
contained Code with regard to arbitration and was F
exhaustive, an award could be enforcej'.1 only by the manner
and according to the procedure laid down in section 17
of the Act. In my view, these decisions and particularly, the
decisions of the Patna High Court and the Madras High
Court clearly indicate the corollary which follows upon an G
Act being regarded as exhaustive viz .. that it carries with
it a negative import that only such acts as are mentioned
in the Act are permissible to be done and acts or things
not mentioned therein are not permissible to be done. In
H
58 SUPREME COURT REPORTS [2011] 11 S.C.R.
A my view, Section 29 of the Act also is exhaustive of the
whole law upon the subject of "interest on awards" and
since the said section enables the court to award interest
on the principal sum adjudged by an award from the date
of the decree onwards, it must be held that it carries with
s it the negative import that it shall not be permissible to the
Court to award interest on the principal sum adjudged by
an award for any period prior to the date of the passing of
the decree."
67. We have so far seen the decisions of the High Courts
C holding that a suit for enforcement of an arbitration award made
on an oral reference was not maintainable, an arbitral award
could only be enforced in terms section 17 of the Arbitration
Act and a suit for the enforcement of an arbitral award was not
maintainable, and third, that no interest could be awarded on
D the amount adjudged in the award beyond the provisions of
section 29 of the Arbitration Act.
68. We now come back to the decision of this Court in
Mohindra Supply Co. in which the issue was about the
E maintainability of an appeal, particularly, a letters patent appeal.
It is seen above that, in Mohindra Supply Co. the court held
that a letters patent appeal was not maintainable in view of
section (2) of section 39 of the 1940 Act. To that extent, the
decision may not have any bearing on the present controversy.
F But, in that decision observations of great significance were
made in regard to the nature of the 1940 Act. It was observed
(SCR page 500):
"The proceedings relating to arbitration are, since the
enactment of the Indian Arbitration Act X of 1940,
G governed by the provisions of that Act. The Act is a
consolidating and amending statute. It repealed the
Arbitration Act of 1899, Schedule 2 of the Code of Civil
Procedure and also els. (a) to (f) of s. 104(1) of the Code
of Civil Procedure which provided for appeals from orders
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 59
LTD. [AFTAB ALAM, J.]
in arbitration proceedings. The Act set up machinery for all A
contractual arbitrations and its provisions, subject to certain
exceptions, apply also to every arbitration under any other
enactment for the time being in force, as if the arbitration
were pursuant to an arbitration agreement and as if that,
other enactment were an arbitration agreement, except in B
· so far as the Arbitration Act is inconsistent with that other
enactment or with any rules made thereunder ........ "
69. It was further observed and held (SCR page 506):
"But it was urged that the interpretation of s.39 should not C
be divorced from the setting of legislative history, and if
regard be had to the legislative history and the dictum of
the Privy Council in Hurrish Chunder Chowdry v. Kali
Sundari Debia [(1882) L.R.10 I.A. 4, 17] which has been
universally followed, in considering the extent of the right D
of appeal under the Letters Patent, the Court would not be
justified in restricting the right of appeal which was
.exercisable till 1940 by litigants against decisions of single
Judges of High Courts in arbitration matters from orders
passed in appeals. In considering the argument whether E
the right of appeal which was previously exercisable by
litigants against decisions of single Judges of the High
Courts in appeals from orders passed in arbitration
proceedings was intended to be taken away by s. 39(2) of
the Indian Arbitration Act, the Court must proceed to F
interpret the words of the statute without any predisposition
towards the state of the law before the Arbitration Act was
enacted. The Arbitration Act of 1940 is a consolidating
and amending statute and is for all purposes a code
relating to arbitration ..... " G
70. And (SCR pages 512-513):
"Prior to 1940 the law relating to contractual arbitration
(except in so far as it was dealt with by the Arbitration Act
H
60 SUPREME COURT REPORTS [2011] 11 S.C ..R.
A of 1899) was contained in the Code of Civil Procedure and
certain orders passed by courts in the course of arbitration
proceedings were made appealable under the Code of
1877 bys. 588 and in the Code of 1908 by s.104. In 1940,
the legislature enacted Act X of 1940, repealing schedule
B 2 and s. 104(1) clauses (a) to (f) of the Code of Civil
Procedure 1908 and the Arbitration Act of 1899. By
s. 39 of the Act, a right of appeal was conferred upon
litigants in arbitration proceedings only from certain orders
and from no others and the right to file appeals from
c appellate orders was expressly taken away by sub-s.2 and
the clause in s.104 of the Code of 1908 which preserved
the special jurisdiction under any other law was
incorporated in s. 39. The section was enacted in a form
which was absolute and not subject to any exceptions. It
is true that under the Code of 1908, an appeal did lie
D
under the Letters Patent from an order passed by a single
Judge of a Chartered High Court in arbitration proceedings
even if the order was passed in exercise of appellate
jurisdiction, but that was so, because, the power of the
Court to hear appeals under a special law for the time
E being in operation was expressly preserved."
'There is in the Arbitration Act no provision similar to s. 4 of
the Code of Civil Procedure which preserves powers
reserved to courts under special statutes. There is also
F nothing in the expression "authorised by law to hear
appeals from original decrees of the Court" contained in "
s. 39(1) of the Arbitration Act which by implication reserves
the jurisdiction under the Letters Patent to entertain an
appeal against the order passed in arbitration
G proceedings. Therefore, in so far as Letters Patent deal
with appeals against orders passed in arbitration
proceedings, they must be read subject to the provisions
of s. 39(1) and (2) of the Arbitration Act."
"Under the Code of 1908, the right to appeal under the
H
FUERST DAY LAWSON LTD. v. JINDAL EXPORTS 61
LTD. [AFTAB ALAM, J.]
Letters Patent was saved both by s. 4 and the clause A
contained ins. 104(1), but by the Arbitration Act of 1940,
the jurisdiction of the Court under any other law for the time
being in force is not saved; the right of appeal can therefore
be exercised against orders in arbitration proceedings
only under s. 39, and no appeal (except an appeal to this B
Court) will lie from an appellate. order."
71. Mahindra Supply Co. was last referred in a constitution
bench decision of this Court in P.S. Sathappan, and the way
the constitution bench understood and interpreted Mohindra C
Supply Co. would be clear from the following paragraph 10 of
the judgment:
"10 ..... The provisions in the Letters Patent providing for
appeal, in so far as they related to orders passed in
· Arbitration proceedings, were held to be subject to the D
provisions of Section 39(1) and (2) of the Arbitration Act,
as the same is a. self,;contained code relating to
arbitration."
72. ll is, thus, to be seen that Arbitration Act 1940, from E
its inception and right through 2004 (in P. S. Sathappan) was
held to be a self-contained code. Now, if Arbitration Act, 1940
was held to be a self-contained code, on matters pertaining to
arbitration the Arbitration and Conciliation Act, 1996, which
consolidates, amends and designs the law relating to arbitration F
to bring it, as much as possible, in harmony with the UNCITRAL
Model must be held only to be more so. Once it is held that the
Arbitration Act is a self-contained code and exhaustive, then it
must also be held, using the lucid expression of Tulzapurkar,
J., that it carries with it "a negative import that only such acts G
as are mentioned in the Act are permissible to be done and
acts or things not mentioned therein are not permissible to be
done". In other words, a Letters Patent Appeal would be
excluded by application of one of the general principles that
where the special Act sets out a self-contained code the
H
62 SUPREME COURT REPORTS (2011] 11 S.C.R.
A applicability of the general law procedure would be impliedly
excluded.
73. We, thus, arrive at the conclusion regarding the
exclusion of a letters patent appeal in two different ways; one,
8 so to say, on a micro basis by examining the scheme devised
by sections 49 and 50 of the 1996 Act and the radical change
that it brings about in the earlier provision of appeal under
section 6 of the 1961 Act and the other on a macro basis by
taking into account the nature and character of the 1996 Act
C as a self-contained and exhaustive code in itself.
74. In light of the discussions made above, it must be held
that no letters patent appeal will lie against an order which is
not appealable under section 50 of the Arbitration and
Conciliation Act, 1996.
D
75. In the result, Civil Appeal No.36 of 2010 is allowed and
the division bench order dated May 8, 2007, holding that the
letters patent appeal is maintainable, is set aside. Appeals
arising from SLP (C) No.31068 of 2009 and SLP (C) No.4648
,E of 2010 are dismissed.
76. SLP (C) Nos.13626-13629 of 2010 and SLP (C)
Nos.22318-22321 of 2010 are dismissed insofar as they seek
to challenge the orders of the division bench holding that the
F letters patent appeals were not maintainable. These two SLPs
may now be listed only in regard to the challenge to the orders
passed by the single judge.
77. There will be no order as to costs.
G 8.8.B. Matter disposed of.
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