M/S SHRIRAM EPC LIMITEDversusRIOGLASS SOLAR SA

                         [2018] 10 S.C.R. 749                            749


                  M/S SHRIRAM EPC LIMITED                                A
                                  v.
                      RIOGLASS SOLAR SA
                   (Civil Appeal No. 9515 of 2018)
                       SEPTEMBER 13, 2018                                B
       [R. F. NARIMAN AND INDU MALHOTRA, JJ.]
      Arbitration and Conciliation Act, 1996 – ss. 48 and 49 –
Foreign award – Enforceability of, when award not stamped – Held:
Foreign award not bearing stamp duty under the Stamp Act, would
                                                                         C
not be rendered unenforceable – Term ‘award’ under Item 12 of
Schedule I of the Stamp Act, does not include foreign award, thus, a
foreign award not being includible in Schedule I, is not liable for
stamp duty – Stamp Act, 1899 – Item 12, Schedule I.
      Dismissing the appeal, the Court
                                                                         D
      HELD: 1. The Single Judge of the High Court is correct,
and the fact that a foreign award has not borne stamp duty under
the Stamp Act, 1899 would not render it unenforceable.
[Para 25] [770-A-B]
       2.1 It becomes clear that the only “award” that is referred       E
to in the Stamp Act, 1899 is an award that is made in the territory
of British India provided that such award is not made pursuant to
a reference made by an order of the Court in the course of a suit.
It is important to note that there were several princely states in
India governed by sovereign rulers which had their own laws.
Arbitration laws, if any, in the said princely states, if they were to   F
culminate in awards, would not be “awards” under either the Civil
Procedure Code, 1882 or the Arbitration Act, 1899. They would
therefore, be foreign awards insofar as British India is concerned.
An award made in a princely state, or in a foreign country, if
enforced by means of a suit in British India, would not be covered       G
by the expression “award” contained in Item 12 of Schedule I of
the Stamp Act, 1899. Only awards which are decisions in writing
by an arbitrator or umpire, made in British India, on a reference
made otherwise than by an order of the Court in the course of a
suit would be included. [Para 10] [759-E-H]
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750            SUPREME COURT REPORTS                    [2018] 10 S.C.R.


A            2.2 “Award” under Item 12 of Schedule I of the Stamp Act,
      1899 has remained unchanged till date. In 1899, this “award”
      would refer only to a decision in writing by an arbitrator or umpire
      in a reference not made by an order of the Court in the course of
      a suit. This would apply only to such award made at the time in
      British India, and today, after the amendment of Section 1(2) of
B
      the Stamp Act, 1899 by Act 43 of 1955, to awards made in the
      whole of India except the State of Jammu and Kashmir. This being
      the case, the expression “award” has never included a foreign
      award from the very inception till date. Consequently, a foreign
      award not being includible in Schedule I of the Stamp Act, 1899,
C     is not liable for stamp duty. The Tamil Nadu Amendment of the
      Stamp Act, 1899 contains the identical definition of “award” as
      given in Item 12 thereof. The only difference is in the figures
      contained for stamp duty. [Para 16] [765-C-E]
            2.3 The Stamp Act, 1899 is a fiscal statute which must be
D     construed literally. Any ambiguity in the said statute would enure
      to the benefit of the assessee who has to pay stamp duty.
      [Para 17][766-B-C]
            2.4 There is no doubt whatsoever that if stamp duties are
      leviable in India on foreign awards, the imposition should not be
E     substantially more onerous than the stamp duty that is imposed
      on recognition or enforcement of domestic arbitral awards. For
      the said Article to apply, stamp duty must first be leviable on a
      foreign award, which, is not the case. Equally, reliance upon the
      194th Law Commission of India Report, insofar as stamp duty on
      domestic awards is concerned, would again have little bearing,
F     given the finding that under the present state of the law, foreign
      awards are not liable to stamp duty under the Stamp Act, 1899.
      [Para 23][769-B-C]
            2.5 An argument that Section 47 of the Act requires three
      things and only three things to be produced before the Court for
G     enforcement of a foreign award, and that therefore, stamp duty
      not being one of the three things required, cannot ever be levied,
      is an extreme argument. All that Section 47 deals with is
      production before the Court of proof of the fact that a foreign

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   M/S SHRIRAM EPC LIMITED v. RIOGLASS SOLAR SA                     751


award is sought to be enforced. In no manner does Section 47        A
interdict the payment of stamp duty if it is otherwise payable in
law. This argument must thus be rejected. Equally, the argument
that under Section 48(2)(b), even if stamp duty is payable on a
foreign award, it would not be contrary to the public policy of
India, must be rejected. The fundamental policy of Indian law, as
                                                                    B
has been held in Renusagar Power Co. Ltd. v. General Electric
Co. makes it clear that if a statute like the Foreign Exchange
Regulation Act, 1973 dealing with the economy of the country is
concerned, it would certainly come within the expression
“fundamental policy of Indian law”. The Stamp Act, 1899, being a
fiscal statute levying stamp duty on instruments, is also an Act    C
which deals with the economy of India, and would, on a parity of
reasoning, be an Act reflecting the fundamental policy of Indian
law. [Para 24] [769-D-G]
     Narayan Trading Co. v. Abcom Trading Pvt. Ltd.
     (2013) 2 MP LJ 252 – approved.                                 D
     Senior Electric Inspector and Ors. v. Laxminarayan
     Chopra and Anr. [1962] 3 SCR 146 – distinguished.
     M. Anasuya Devi and Anr. v. M. Manik Reddy and Ors.
     (2003) 8 SCC 565 : [2003] 4 Suppl. SCR 853 ; Fuerst
     Day Lawson Ltd. v. Jindal Exports Ltd. (2001) 6 SCC            E
     356 – held inapplicable.
     Bharat Aluminium Co. v. Kaiser Aluminium Technical
     Services Inc. (2012) 9 SCC 552 : [2012] 12 SCR 327 ;
     Gujrals Co. v. M.A. Morris AIR 1962 P&H 167 ; Naval
     Gent Maritime Ltd. v. Shivanath Rai Harnarain (I) Ltd.         F
     (2009) 163 DLT 391 ; Orient Middle East Lines Ltd.,
     Bombay and Anr. v. Brace Transport Corporation of
     Monrovia and Ors. AIR 1986 Guj 62 ; Thyssen
     Stahlunion GMBH v. Steel Authority of India Ltd.
     (1999) 9 SCC 334 : [1999] 3 Suppl. SCR 461;                    G
     Renusagar Power Co. Ltd. v. General Electric Co.
     (1994) 1 Suppl. SCC 644 : [1993] 3 Suppl. SCR 22 ;
     Associate Builders v. Delhi Development Authority
     (2015) 3 SCC 49 – referred to.

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752            SUPREME COURT REPORTS                       [2018] 10 S.C.R.


A                            Case Law Reference
            [2012] 12 SCR 327          referred to      Para 3.2
            AIR 1962 P&H 167           referred to      Para 4
            (2009) 163 DLT 391         referred to      Para 4
            AIR 1986 Guj 62            referred to      Para 4
B           [1962] 3 SCR 146           distinguished    Para 17
            [2003] 4 Suppl. SCR 853   held inapplicable Para 19
            (2001) 6 SCC 356          held inapplicable Para 19
            [1999] 3 Suppl. SCR 461   referred to       Para 19
            (2013) 2 MP LJ 252         approved         Para 20
C
            [1993] 3 Suppl. SCR 22    referred to       Para 24
            (2015) 3 SCC 49            referred to      Para 24

            CIVIL APPELLATE JURISDICTION : Civil Appeal No. 9515
D     of 2018.
            From the Judgment and Order dated 09.02.2017 of the High
      Court of Judicature at Madras in O.P. No. 587 of 2015.
            K. V. Vishwanthan, Sr. Adv., Ms. Pooja Saigal, Ravi Raghunath,
      Ms. Vrinda Bhandari, Snehasish Mukherjee, Venkataraman R., Dhananjay
E     Ray Bhaskar, Advs. for the Appellant.
            Shashank Garg, Ms. Amrita Grover, Divyakant Lahoti, Tariq Khan,
      Parikshit Ahuja, Debjyoti, Advs. for the Respondent.
            The Judgment of the Court was delivered by
F           R. F. NARIMAN, J. 1. Leave granted.
             2. The present appeal arises from the judgment of a Single Judge
      of the High Court of Judicature at Madras, dated 09.02.2017, in which a
      petition filed to enforce a foreign award was allowed. Several grounds
      were taken before the learned single Judge. We are concerned with
G     only one ground that has been argued before us, namely, that as the
      award has not been stamped, it cannot be enforced under Sections 48
      and 49 of the Arbitration and Conciliation Act, 1996 (“1996 Act”).
            3. The brief facts that are necessary for determination of the
      present controversy are as follows:
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    M/S SHRIRAM EPC LIMITED v. RIOGLASS SOLAR SA                              753
                  [R. F. NARIMAN, J.]

      3.1. An ICC award was delivered in London on 12.02.2015 by              A
Mr. Christopher Style QC in the following terms:

      “363. After consideration of all the factual and legal submissions
      which have been presented to me and for the reasons set out in
      full above, I award, declare and adjudge as follows:
                                                                              B
      (1) I declare that I have no jurisdiction over the Second and Third
      Respondents.

      (2) I declare that Rioglass is not obliged to issue a Performance
      Bank Guarantee as provided for in clause 6 of the Agreement, as
      amended by Amendment No.1.                                              C

      (3) I declare that Rioglass is entitled to sell as scrap the mirrors
      that it holds in storage in relation to Delivery Four.

      (4) I declare that Shriram acted in breach of the Agreement in the
      respects set out above.                                                 D
      (5) I order Shriram to pay Rioglass €4,366,598.70, consisting of
      damages amounting to €4,151,570.52 and interest amounting to
      €215,028.18.”

       3.2. Objections dated 21.07.2015 under Section 34 of the               E
Arbitration and Conciliation Act, 1996 were filed by the Appellant which
were dismissed on 27.09.2016, stating that a petition under Section 34
would not be maintainable as against a foreign award, citing this Court’s
judgment in Bharat Aluminium Co. v. Kaiser Aluminium Technical
Services Inc., (2012) 9 SCC 552. Meanwhile, the Respondent filed a
petition under Section 47 of the 1996 Act, dated 05.08.2015, to enforce       F
the said award. As stated hereinabove, all objections to the said award
were rejected by the learned Single Judge on 09.02.2017. An appeal to
the Division Bench resulted in an Order dated 14.03.2018, stating that in
view of Section 50 of the 1996 Act, the said appeal would not be
maintainable. This is how the present SLP has been filed against the          G
decision of the learned Single Judge.

       4. Shri K.V. Viswanathan, learned senior advocate, appearing on
behalf of the Appellant, has submitted before us, that given the provisions

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754            SUPREME COURT REPORTS                         [2018] 10 S.C.R.


A     of the Indian Stamp Act, 1899, it is clear that a foreign award would be
      covered by the said Act. This being so, and stamp duty not having been
      paid, the said foreign award cannot be enforced. He relied strongly on a
      judgment of the Punjab and Haryana High Court reported in Gujrals
      Co. v. M.A. Morris, AIR 1962 P&H 167. According to him, the contrary
      judgments of the Delhi High Court reported in Naval Gent Maritime
B
      Ltd. v. Shivanath Rai Harnarain (I) Ltd., (2009) 163 DLT 391, and
      the Madhya Pradesh High Court judgment reported in Narayan Trading
      Co. v. Abcom Trading Pvt. Ltd., (2013) 2 MP LJ 252, are incorrect.
      According to the learned senior advocate, the Delhi High Court judgment
      is really a judgment on registration of a foreign award, even though it
C     purports to speak about stamp duty payable. The judgment of the Madhya
      Pradesh High Court, on the other hand, is not correct in stating that a
      foreign award would not be included within the term “award” under
      Schedule I of the Indian Stamp Act, 1899. He relied upon the Gujarat
      High Court judgment reported in Orient Middle East Lines Ltd.,
      Bombay and Anr. v. Brace Transport Corporation of Monrovia
D
      and Ors., AIR 1986 Guj 62, which stated that Article III of the New
      York Convention would make it clear that stamp duty, being in the nature
      of fees or charges for recognition and enforcement of a foreign award,
      can be enforced in accordance with the rules of procedure of the territory
      in which the award is sought to be enforced. This being so, the New
E     York Convention itself recognizes that foreign awards may have to bear
      stamp duty for enforcement in the country in which they are sought to
      be enforced. He further relied upon the 194th Law Commission Report,
      which had suggested changes insofar as stamp duty is concerned in
      Part II of the 1996 Act.
F            5. Learned counsel appearing on behalf of the Respondent, on
      the other hand, relied strongly upon the judgment of the Delhi High Court
      as well as the Madhya Pradesh High Court referred to hereinabove.
      According to the learned counsel, the expression “award” which occurs
      in Schedule I of the Indian Stamp Act, 1899 applies only to a domestic
G     award and not a foreign award. He relied on the fact that the Indian
      Stamp Act was enacted in 1899, in which “award” has never been
      enlarged so as to include foreign awards after the Arbitration (Protocol
      and Convention) Act, 1937 and/or the Foreign Awards (Recognition and


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    M/S SHRIRAM EPC LIMITED v. RIOGLASS SOLAR SA                                   755
                  [R. F. NARIMAN, J.]

Enforcement) Act, 1961 were enacted. Also, according to the learned                A
counsel, the only requirement for the enforcement of a foreign award is
laid down in Section 47 of the Act, which does not require the award to
be stamped. A without prejudice argument was also made that under
Section 48(2)(b), even if a foreign award were required to be stamped,
but is not stamped, enforcement of such award would not be contrary to
                                                                                   B
the fundamental policy of Indian law.

        6. Having heard learned counsel for the parties, it is important to
first set out the relevant provisions of the Indian Stamp Act, 1899. Section
1 of the Indian Stamp Act, 1899 as it originally stood, reads as follows:
                                                                                   C
      “1. Short title, extent, and commencement.—(1) This Act
      may be called the Indian Stamp Act, 1899.

      (2) It extends to the whole of British India inclusive of Upper
      Burma, British Baluchistan, the Santal Parganas, and the Pargana
      of Spiti; and                                                                D

      (3) It shall come into force on the first day of July 1899.”

Section 2(14) defines “instrument” as follows:

      “2. Definitions.—                                                            E

          xxx xxx xxx

          (14) “Instrument” includes every document by which any
          right or liability is or purports to be created, transferred, limited,
          extended, extinguished, or recorded:”                                    F

      “Instruments chargeable with duty” are dealt with by Section 3.
      Section 3 states as follows:

      “3. Instruments chargeable with duty.—Subject to the
                                                                                   G
      provisions of this Act and the exemptions contained in Schedule I,
      the following instruments shall be chargeable with duty of the
      amount indicated in that Schedule as the proper duty therefore,
      respectively, that is to say—

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756            SUPREME COURT REPORTS                           [2018] 10 S.C.R.


A               (a) every instrument mentioned in that Schedule which, not
                having been previously executed by any person, is executed in
                India on or after the first day of July, 1899;

                (b) every bill of exchange payable otherwise than on demand
                or promissory note drawn or made out of India on or after that
B               day and accepted or paid, or presented for acceptance or
                payment, or endorsed, transferred or otherwise negotiated, in
                India; and
                (c) every instrument (other than a bill exchange or promissory
                note) mentioned in that Schedule, which, not having been
C               previously executed by any person, is executed out of India on
                or after that day relates to any property situate, or to any matter
                or thing done or to be done, in India and is received in India:
            Provided that no duty shall be chargeable in respect of—

D               (1) any instrument executed by, or on behalf of, or in favour of,
                the Government in cases where, but for this exemption, the
                Government would be liable to pay the duty chargeable in
                respect of such instrument;
                (2) any instrument for the sale, transfer or other disposition,
E               either absolutely or by way of mortgage or otherwise, of any
                ship or vessel, or any part, interest, share or property of or in
                any ship or vessel, registered under the Merchant Shipping
                Act, 1894, or under Act 19 of 1938, or the Indian Registration
                of Ships Act, 1841 (10 of 1841) as amended by subsequent
                Acts.
F
                (3) any instrument executed, by, or, on behalf of, or, in favour
                of, the Developer, or Unit or in connection with the carrying
                out of purposes of the Special Economic Zone.
            Explanation.—For the purposes of this clause, the expressions
            “Developer”, “Special Economic Zone” and “Unit” shall have
G
            meanings respectively assigned to them in clause (g), (za) and
            (zc) of section 2 of the Special Economic Zones Act, 2005.”
             Under Sections 33 and 35, instruments that are not duly stamped
      in accordance with the provisions of the Act are inadmissible in evidence,

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    M/S SHRIRAM EPC LIMITED v. RIOGLASS SOLAR SA                              757
                  [R. F. NARIMAN, J.]

and any such instrument which is not duly stamped is liable to be             A
impounded as provided in Section 33 of the Act. Item No.12 of Schedule
I of the Indian Stamp Act, 1899 reads as follows:


         Description of Instrument               Proper Stamp-duty
                                                                              B

  “12. AWARD, that is to say, any decision in writing by an arbitrator or
  umpire, not being an award directing a partition, on a reference made
  otherwise than by an order of the Court in the course of a suit.—
                                                                              C
   (a) where the amount or value of      The same duty as a bond (No.
   the property to which the award       15) for such amount.
   relates as set forth in such award
   does not exceed Rs. 1000;
   (b) in any other case.                Five rupees.
                                                                              D


                                     Exemption
      Award under the Bombay District Municipal Act, 1873 (Bom.
      Act 6 of 1873), Section 81, or the Bombay Hereditary Offices
                                                                              E
      Act, 1874 (Bom. Act 3 of 1874), Section 18.”
      7. The main bone of contention in the present appeal is whether
the expression “award” would include a foreign award.

       8. In order to determine this question, it is important to see the
                                                                              F
state of the law insofar as arbitration is concerned in the year of the
Indian Stamp Act, 1899. At this point of time, there were two sets of
laws dealing with arbitration. The first was contained in the Code of
Civil Procedure, 1882. In Part V, Chapter XXXVII spoke of reference
to arbitration. Under Sections 506 to 522 of the Code of Civil Procedure,
1882, parties to a suit may apply for an order of reference to arbitration,   G
in which case, the arbitrator or umpire, as the case may be, may deliver
an award which ultimately may be enforced by a judgment which is to
be according to the award and a decree to follow. By Sections 523 to
526, agreements to refer disputes to arbitration may be filed in Court,
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758            SUPREME COURT REPORTS                          [2018] 10 S.C.R.


A     and awards delivered thereon. Needless to add, the Civil Procedure
      Code, 1882 applied to British India.

             9. Close on the heels of the Indian Stamp Act, 1899, comes the
      Indian Arbitration Act, 1899. As per Section 1(2) of this Act, this Act
      also extended to the whole of British India, but Section 2 made it clear
B     that the Act will apply only in cases where the subject matter submitted
      to arbitration, if it were the subject of a suit, could be instituted in a
      Presidency Town. Section 2 of this Act states as follows:

            “2. Application.—Subject to the provisions of section 23, this
C           Act shall apply only in cases where, if the subject-matter submitted
            to arbitration were the subject of a suit, the suit could, whether
            with leave or otherwise, be instituted in a Presidency-town:

               Provided that the Local Government, with the previous sanction
            of the Governor-General in Council, may, by notification in the
D           local official Gazette, declare this Act applicable in any other local
            area as if it were a Presidency-town.”

      Section 4 of the said Act states as follows:

            “4. Definitions.—In this Act, unless there is anything repugnant
E           in the subject or context,-

            (a) “the Court” means, in the Presidency-towns, the High Court,
            and, elsewhere, the Court of the District Judge; and

            (b) “submission” means a written agreement to submit present or
F
            future differences to arbitration, whether an arbitrator is named
            therein or not.”

      Section 11 then states:

G           “11. Award to be signed and filed.—(1) When the arbitrators
            or umpire have made their award, they shall sign it, and shall give
            notice to the parties of the making and signing thereof, and of the
            amount of the fees and charges payable to the arbitrators or umpire
            in respect of the arbitration and award.

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    M/S SHRIRAM EPC LIMITED v. RIOGLASS SOLAR SA                              759
                  [R. F. NARIMAN, J.]

      (2) The arbitrators or umpire shall at the request of any party to      A
      the submission or any person claiming under him, and upon payment
      of the fees and charges due in respect of the arbitration and award,
      and of the costs and charges of filing the award, cause the award,
      or a signed copy of it, to be filed in the Court; and notice of the
      filing shall be given to the parties by the arbitrators or umpire.
                                                                              B
      (3) Where the arbitrators or umpire state a special case under
      section 10, clause (b), the Court shall deliver its opinion thereon;
      and such opinion shall be added to, and shall form part of, the
      award.”
                                                                              C
Section 15, which is important, states as follows:

      “15. Award when filed to be enforceable as a decree.—(1)
      An award on a submission, on being filed in the Court in accordance
      with the foregoing provisions, shall (unless the Court remits it to
      the reconsideration of the arbitrators or umpire, or sets it aside),    D
      be enforceable as if it were a decree of the Court.

      (2) An award may be conditional or in the alternative.”

       10. On a reading of the aforesaid provisions of these Acts, it
becomes clear that the only “award” that is referred to in the Indian         E
Stamp Act, 1899 is an award that is made in the territory of British India
provided that such award is not made pursuant to a reference made by
an order of the Court in the course of a suit. At this point in time, it is
important to note that there were several princely states in India governed
by sovereign rulers which had their own laws. Arbitration laws, if any, in    F
the aforesaid princely states, if they were to culminate in awards, would
not be “awards” under either the Civil Procedure Code, 1882 or the
Indian Arbitration Act, 1899. They would therefore be foreign awards
insofar as British India is concerned. An award made in a princely state,
or in a foreign country, if enforced by means of a suit in British India,
would not be covered by the expression “award” contained in Item 12           G
of Schedule I of the Indian Stamp Act, 1899. Only awards which are
decisions in writing by an arbitrator or umpire, made in British India, on
a reference made otherwise than by an order of the Court in the course
of a suit would be included.
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760            SUPREME COURT REPORTS                        [2018] 10 S.C.R.


A           11. This position continued even when the Code of Civil Procedure,
      1908 contained a Second Schedule, which substituted the arbitration
      provisions contained in the Code of Civil Procedure, 1882. Here again,
      under the Second Schedule, parties to a suit may apply for an order of
      reference to arbitration and an award would follow. Section 16 of the
      Second Schedule is important, and states as follows:
B
            “16. Judgment to be according to award.— (1) Where the
            Court sees no cause to remit the award or any of the matters
            referred to arbitration for re-consideration in manner aforesaid,
            and no application has been made to set aside the award, or the
C           Court has refused such application, the Court shall, after the time
            for making such application has expired, proceed to pronounce
            judgment according to the award.

            (2) Upon the judgment so pronounced a decree shall follow, and
            no appeal shall lie from such decree except insofar as the decree
D           is in excess of, or not in accordance with, the award.”

            Under Sections 20 and 21, arbitration without the intervention of
      a Court is referred to, and awards delivered in such cases are to be
      incorporated in a judgment by a Court, after which a decree is to follow,
      which decree then becomes enforceable.
E
            12. Next in line, chronologically speaking, is the Arbitration
      (Protocol and Convention) Act, 1937, in which, certain foreign awards
      governed by the Geneva Convention of 1923 were to be recognized and
      enforced in signatory countries, India being one. In this Act, “foreign
F     award” is defined as follows:

            “2. Interpretation.—In this Act “foreign award” means an award
            on differences relating to matters considered as commercial under
            the law in force in India, made after the 28th day of July, 1924,—

G              (a) in pursuance of an agreement for arbitration to which the
               Protocol set forth in the First Schedule applies;

               (b) between persons of whom one is subject to the jurisdiction
               of some one of such powers as the Central Government, being
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    M/S SHRIRAM EPC LIMITED v. RIOGLASS SOLAR SA                                 761
                  [R. F. NARIMAN, J.]

          satisfied that reciprocal provisions have been made, may, by           A
          notification in the Official Gazette, declare to be parties to the
          Convention set forth in the Second Schedule, and of whom the
          other is subject to the jurisdiction of some other of the powers
          aforesaid; and

          (c) in one of such territories as the Central Government being         B
          satisfied that reciprocal provisions have been may by like
          notification, declare to be territories to which the said convention
          applies,

      and for the purposes of this Act an award shall not be deemed to           C
      be final if any proceedings for the purposes of contesting the
      validity of the award are pending in the country in which it was
      made.”

      13. The Arbitration Act, 1940 then came into force, repealing both
the Arbitration Act, 1899 as well as the Second Schedule to the Code of          D
Civil Procedure, 1908. This Act, under Section 1(2), extended to the
whole of India except the State of Jammu and Kashmir. Under this Act,
“award” was defined as follows:

      “2. Definitions.—
                                                                                 E
      xxx xxx xxx

      (b) “award” means an arbitration award;”

       Under this Act, Chapter II dealt with arbitration without the
                                                                                 F
intervention of a Court. Section 17 is important, and is set out as follows:

      “17. Judgment is terms of award.— Where the Court sees no
      cause to remit the award or any of the matters referred to arbitration
      for reconsideration or to set aside the award, the Court shall, after
      the time for making an application to set aside the award has              G
      expired, or such application having been made, after refusing it,
      proceed to pronounce judgment according to the award, and 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.”
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762             SUPREME COURT REPORTS                            [2018] 10 S.C.R.


A             Under Chapter III, arbitration with intervention of a Court where
      there is no suit pending is dealt with, and in Chapter IV, arbitration which
      arises in references from suits is dealt with. This Act, like its predecessors,
      also applied only to awards that were made first in British India, and
      later in the territory of India except the State of Jammu and Kashmir.
B           14. In 1961, after the New York Convention of 1958, the Foreign
      Awards (Recognition and Enforcement) Act, 1961, came into force to
      recognize and enforce New York Convention Awards. Here again, such
      awards were referred to as “foreign awards” in Section 2 thereof which
      defines foreign awards as follows:
C
             “2. Definition.—In this Act, unless the context otherwise requires,
             “foreign award” means an award on differences between persons
             arising out of legal relationships, whether contractual or not,
             considered as commercial under the law in force in India, made
             on or after the 11th day of October, 1960—
D
                (a) in pursuance of an agreement in writing for arbitration to
                which the Convention set forth in the Schedule applies; and

                (b) in one of such territories as the Central Government being
                satisfied that reciprocal provisions have been made, may, by
E               notification in the official Gazette, declare to be territories to
                which the said Convention applies.”

             15. As is well-known, the present Arbitration and Conciliation Act,
      1996 then came into force and repealed the Arbitration (Protocol and
      Convention) Act, 1937, The Arbitration Act, 1940, and the Foreign Awards
F     (Recognition and Enforcement) Act, 1961 bringing, with certain important
      changes, domestic awards within Part I, foreign awards relatable to the
      New York Convention within Chapter I of Part II, and foreign awards
      relatable to the Geneva Convention within Chapter II of Part II. In the
      present Act, under Section 2(1)(c), “arbitral award” is defined as follows:
G
             “2. Definitions.—(1) In this Part, unless the context otherwise
             requires,—

                xxx xxx xxx

                (c) “arbitral award” includes an interim award;”
H
    M/S SHRIRAM EPC LIMITED v. RIOGLASS SOLAR SA                              763
                  [R. F. NARIMAN, J.]

     Section 44 in Chapter I of Part II defines a New York Convention         A
award as follows:

      “44. Definition.—In this Chapter, unless the context otherwise
      requires, “foreign award” means an arbitral award on differences
      between persons arising out of legal relationships, whether
      contractual or not, considered as commercial under the law in           B
      force in India, made on or after the 11th day of October, 1960—

         (a) in pursuance of an agreement in writing for arbitration to
         which the Convention set forth in the First Schedule applies,
         and
                                                                              C
         (b) in one of such territories as the Central Government, being
         satisfied that reciprocal provisions have been made may, by
         notification in the Official Gazette, declare to be territories to
         which the said Convention applies.”
                                                                              D
     Section 53 in Chapter II of Part II defines a Geneva Convention
award as follows:

      “53. Interpretation.—In this Chapter “foreign award” means
      an arbitral award on differences relating to matters considered as
      commercial under the law in force in India made after the 28th          E
      day of July, 1924,—

         (a) in pursuance of an agreement for arbitration to which the
         Protocol set forth in the Second Schedule applies, and

         (b) between persons of whom one is subject to the jurisdiction       F
         of some one of such powers as the Central Government, being
         satisfied that reciprocal provisions have been made, may, by
         notification in the Official Gazette, declare to be parties to the
         Convention set forth in the Third Schedule, and of whom the
         other is subject to the jurisdiction of some other of the powers
         aforesaid, and                                                       G

         (c) in one of such territories as the Central Government, being
         satisfied that reciprocal provisions have been made, may, by
         like notification, declare to be territories to which the said
         Convention applies,
                                                                              H
764           SUPREME COURT REPORTS                         [2018] 10 S.C.R.


A          and for the purposes of this Chapter an award shall not be deemed
           to be final if any proceedings for the purpose of contesting the
           validity of the award are pending in the country in which it was
           made.”

            The other important sections which have a bearing on the
B     controversy before us are as follows:

           “46. When foreign award binding.—Any foreign award which
           would be enforceable under this Chapter shall be treated as binding
           for all purposes on the persons as between whom it was made,
C          and 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 any references in this Chapter to enforcing a foreign award
           shall be construed as including references to relying on an award.

           47. Evidence.—(1) The party applying for the enforcement of a
D          foreign award shall, at the time of the application, produce before
           the Court—

              (a) the original award or a copy thereof, duly authenticated in
              the manner required by the law of the country in which it was
              made;
E
              (b) the original agreement for arbitration or a duly certified
              copy thereof; and

              (c) such evidence as may be necessary to prove that the award
              is a foreign award.
F
           (2) If the award or agreement to be produced under sub-section
           (1) is in a foreign language, the party seeking to enforce the award
           shall produce a translation into English certified as correct by a
           diplomatic or consular agent of the country to which that party
G          belongs or certified as correct in such other manner as may be
           sufficient according to the law in force in India.

           Explanation.— In this section and in the sections following in
           this Chapter, “Court” means the High Court having original
           jurisdiction to decide the questions forming the subject-matter of
H
    M/S SHRIRAM EPC LIMITED v. RIOGLASS SOLAR SA                                765
                  [R. F. NARIMAN, J.]

      the arbitral award if the same had been the subject-matter of a           A
      suit on its original civil jurisdiction and in other cases, in the High
      Court having jurisdiction to hear appeals from decrees of courts
      subordinate to such High Court.”

      xxx xxx xxx
                                                                                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.”

       16. It will thus be seen that “award” under Item 12 of Schedule I
                                                                                C
of the Indian Stamp Act, 1899 has remained unchanged till date. As has
been held by us hereinabove, in 1899, this “award” would refer only to a
decision in writing by an arbitrator or umpire in a reference not made by
an order of the Court in the course of a suit. This would apply only to
such award made at the time in British India, and today, after the
amendment of Section 1(2) of the Indian Stamp Act, 1899 by Act 43 of            D
1955, to awards made in the whole of India except the State of Jammu
and Kashmir. This being the case, we are of the view that the expression
“award” has never included a foreign award from the very inception till
date. Consequently, a foreign award not being includible in Schedule I of
the Indian Stamp Act, 1899, is not liable for stamp duty. Shri Viswanathan
                                                                                E
also relied upon the Tamil Nadu Amendment of the Indian Stamp Act,
1899. The Tamil Nadu Amendment contains the identical definition of
“award” as given in Item 12 thereof. The only difference is in the figures
contained for stamp duty. Consequently, this does not take the matter
very much further.
                                                                                F
       17. Shri Viswanathan then argued, based on Senior Electric
Inspector and Ors. v. Laxminarayan Chopra and Anr., (1962) 3
SCR 146, that an Act must be construed as on date, despite the fact that
the definition contained in an old Act may not literally fit the bill. We are
afraid that this judgment is wholly distinguishable in that, in the aforesaid
case, the definition of “telegraph line” in the Indian Telegraph Act, 1885,     G
was construed as being wide enough to include electric lines used for
the purpose of wireless telegraph. This Court held that in a modern
progressive society, it would be unreasonable to confine the intention of
the legislature to the meaning attributable to a word used at the time the
                                                                                H
766             SUPREME COURT REPORTS                          [2018] 10 S.C.R.


A     law was made, and, unless a contrary intention appeared, an interpretation
      should be given to the words used in the statute to take in new facts and
      situations, if such words are capable of comprehending them. As stated
      hereinabove, this judgment is wholly distinguishable in that, given the
      factual scenario of 1899, and the fact that foreign awards existed even
      then, in princely states as well as foreign countries, no new fact situation
B
      has arisen subsequently in order to apply the ratio of the said judgment.
      Further, we must not forget that the Indian Stamp Act, 1899 is a fiscal
      statute which must be construed literally. Any ambiguity in the said statute
      would enure to the benefit of the assessee who has to pay stamp duty.
      This being the case, Shri Viswanathan’s argument based on the aforesaid
C     judgment, must be rejected.
             18. We now come to some of the judgments referred to by counsel
      for the parties. The Punjab and Haryana High Court judgment (supra),
      strongly relied upon by Shri Viswanathan, referred to and relied upon
      Section 3(c) of the Indian Stamp Act, 1899, and held that an instrument
D     mentioned in the Schedule which is executed out of India, being a foreign
      award, would relate to a matter or thing done or not to be done in India,
      and that, therefore, stamp duty would be payable on such an award. It is
      important to note that this judgment does not refer to the definition of
      “award” in Item 12 of Schedule I at all. For this reason alone, this judgment
E     cannot take us very much further, as it is clear that a foreign award, as
      has been held by us, is not contained within the expression “award” in
      Item 12 of Schedule I and is, therefore, not an “instrument” which is
      taxable under Section 3(c) of the Indian Stamp Act, 1899.
             19. The Delhi High Court judgment (supra), strongly relied upon
      by learned counsel appearing on behalf of the Respondent also does not
F
      take us very much further. As has been rightly pointed out by Shri
      Viswanathan, the said judgment refers to the definition of “foreign award”
      contained in the 1996 Act, but then goes on to rely upon a Supreme
      Court judgment, stating that such foreign award would not require
      registration as it can be enforced as a decree. It further went on to rely
G     upon the Supreme Court judgment in M. Anasuya Devi and Anr. v.
      M. Manik Reddy and Ors., (2003) 8 SCC 565, to state that the Court,
      while deciding enforceability of a foreign award under Sections 47 and
      48, cannot hold the award non-enforceable on the ground of it being
      unstamped. This also, strictly speaking, is incorrect, as M. Anasuya
      (supra) merely stated, in the context of a domestic award, that the
H
    M/S SHRIRAM EPC LIMITED v. RIOGLASS SOLAR SA                               767
                  [R. F. NARIMAN, J.]

question as to whether an award is required to be stamped would be             A
relevant only at the enforcement stage under Section 36 of the 1996 Act
and not at the stage of challenge, which is governed by Section 34 of the
1996 Act. We cannot forget that there is no challenge stage so far as a
foreign award is concerned – so long as none of the grounds in Section
48 are attracted, the award becomes enforceable as a decree. The stage
                                                                               B
of enforceability, therefore, has arisen in these cases, and it cannot be
said that the ratio of M. Anasuya (supra) would apply so that stamp
duty would become payable only at some subsequent stage. This judgment
is equally incorrect in stating that Fuerst Day Lawson Ltd. v. Jindal
Exports Ltd., (2001) 6 SCC 356, would apply. One sentence in Fuerst
Day Lawson (supra) reads, “[T]he only difference as found is that while        C
under the Foreign Awards Act a decree follows, under the new Act the
foreign award is already stamped as the decree.” This sentence does
not lead to the conclusion, following the judgment in Thyssen Stahlunion
GMBH v. Steel Authority of India Ltd., (1999) 9 SCC 334, that
under the 1996 Act, a foreign award is considered to be stamped already.
                                                                               D
All that this sentence means is that the foreign award is to be regarded
as a decree. The expression “stamped” means “regarded”. This judgment
also does not carry us much further.
       20. On the other hand, the Madhya Pradesh High Court
judgment (supra) hits nearer home. This judgment, in paragraph 12
thereof, states why foreign awards do not have to suffer stamp duty in         E
the following terms:
      “12. The Law on Arbitration in India was substantially contained
      in three enactments namely, The Arbitration Act, 1940, The
      Arbitration (Protocol and Convention) Act, 1937 and The Foreign
      Awards (Recognition and Enforcement) Act, 1961. It was widely            F
      felt the 1940 Act, which contains the General Law of Arbitration,
      has become outdated. The Arbitration and Conciliation Act, 1996
      came in force to consolidate and amend the Law relating to
      Domestic Arbitrations, International Commercial Arbitration,
      enforcement of foreign arbitral awards and to define the law             G
      relating to conciliation, commission on international trade in short
      (UNCITRAL) Model Law and Rules. Apart from other object,
      the object of the Act is to provide that every final arbitral award is
      enforced in the same manner as if it were a decree of the Court.
      While Arbitration and Conciliation Act, 1996 was enforced, no
                                                                               H
768            SUPREME COURT REPORTS                          [2018] 10 S.C.R.


A           amendment was made in the definition of award given in the Indian
            Stamp Act. Similarly, the Schedule which lays down the stamp
            duty payable on award was not amended by including the foreign
            award. It appears that law makers while enforcing the Arbitration
            and Conciliation Act, 1996 was of the view that foreign award
            shall be enforceable as if it were a decree of the Court, no
B
            amendment was brought either in the definition of award or in the
            Schedule relating to payment of stamp duty on award. Since the
            definition of award given at Entry No. 11 of the Schedule of the
            Indian Stamp Act does not cover the foreign award and one of
            the objects to enforce the new Act was to enforce final award as
C           if it was a decree and keeping in view the law laid down by the
            Hon’ble Apex Court in the matter of Fuerst Day Lawson Ltd.
            (supra), wherein the Hon’ble Supreme Court has held that under
            the new Act the foreign award is already stamped as decree, this
            Court is of the view that the petition filed by the petitioner has no
            merits and deserves to be dismissed. In view of this, the petition
D
            filed by the petitioner is disposed of holding that foreign award is
            already stamped and is enforceable as decree.”
             21. The reasoning contained in paragraph 12 has our approval,
      short of the reasoning contained following Fuerst Day Lawson (supra)
      which, as we have already stated above, did not indicate that foreign
E     awards can never suffer stamp duty.
              22. The other judgment heavily relied upon by Shri Viswanathan,
      namely the Gujarat High Court judgment (supra), merely refers to
      Article III of the New York Convention to state that so far as procedural
      aspects relatable to foreign awards are concerned, we must go by the
F     Code of Civil Procedure, and going by the Code of Civil Procedure, the
      Court at Bhavnagar would have no jurisdiction to enforce the foreign
      award in the facts of that case. Since Article III of the New York
      Convention is strongly relied upon by Shri Viswanathan, we need to set
      it out. It states:
G           “Article III
            Each Contracting State shall recognise arbitral awards as binding
            and enforce them in accordance with the rules of procedure of
            the territory where the award is relied upon under the conditions

H
    M/S SHRIRAM EPC LIMITED v. RIOGLASS SOLAR SA                              769
                  [R. F. NARIMAN, J.]

      laid down in the following articles. There shall not be imposed         A
      substantially more onerous conditions or higher fees or charges
      on the recognition or enforcement of arbitral awards to which this
      Convention applies than are imposed on the recognition or
      enforcement of domestic arbitral awards.”
       23. There is no doubt whatsoever that if stamp duties are leviable     B
in India on foreign awards, the imposition should not be substantially
more onerous than the stamp duty that is imposed on recognition or
enforcement of domestic arbitral awards. For the said Article to apply,
stamp duty must first be leviable on a foreign award, which, as we have
held earlier in this judgment, is not the case. Equally, reliance upon the
194th Law Commission of India Report, insofar as stamp duty on domestic       C
awards is concerned, would again have little bearing, given our finding
that under the present state of the law, foreign awards are not liable to
stamp duty under the Indian Stamp Act, 1899.
       24. An argument was made by learned counsel for the Respondent
that Section 47 of the Act requires three things and only three things to     D
be produced before the Court for enforcement of a foreign award, and
that therefore, stamp duty not being one of the three things required,
cannot ever be levied. We are afraid that this again is an extreme
argument. All that Section 47 deals with is production before the Court
of proof of the fact that a foreign award is sought to be enforced. In no     E
manner does Section 47 interdict the payment of stamp duty if it is
otherwise payable in law. This argument must thus be rejected. Equally,
the argument that under Section 48(2)(b), even if stamp duty is payable
on a foreign award, it would not be contrary to the public policy of India,
must be rejected. The fundamental policy of Indian law, as has been
held in Renusagar Power Co. Ltd. v. General Electric Co., 1994                F
Supp (1) SCC 644, and followed in Associate Builders v. Delhi
Development Authority, (2015) 3 SCC 49, makes it clear that if a
statute like the Foreign Exchange Regulation Act, 1973 dealing with the
economy of the country is concerned, it would certainly come within the
expression “fundamental policy of Indian law”. The Indian Stamp Act,          G
1899, being a fiscal statute levying stamp duty on instruments, is also an
Act which deals with the economy of India, and would, on a parity of
reasoning, be an Act reflecting the fundamental policy of Indian law.
This argument on behalf of the Respondent must also, therefore, be
rejected.
                                                                              H
770                SUPREME COURT REPORTS                    [2018] 10 S.C.R.


A           25. We, therefore, hold that the learned Single Judge of the Madras
      High Court is correct, and the fact that a foreign award has not borne
      stamp duty under the Indian Stamp Act, 1899 would not render it
      unenforceable for the reasons given in our judgment. The appeal
      accordingly stands dismissed.
B
      Nidhi Jain                                                Appeal dismissed.




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