NDLI: Transocean Shipping Agency (p) Ltd. Vs. Black Sea Shipping and Ors.

Content Provider	Supreme Court of India
e-ISSN	30484839
Language	English
Access Restriction	NDLI
Subject Keyword	Act 1961 : Section 2(b) & 7(1)(a)(iv) Foreign Awards (Recognition and Enforcement)
Content Type	Text
Resource Type	Law Judgement
Jurisdiction	India
Act(s) Referred	Foreign Awards (recognition and Enforcement) Act, 1961 (45 of 1961)
Case Type	Appeal
Court	Supreme Court of India
Disposal Nature	Appeal Dismissed
Headnote	Foreign Awards (Recognition and Enforcement), Act 1961 : Section 2(b). Foreign Award-Enforcement of-Notification declared reciprocal territories "to which the said Convention applies" S. 2(b)-"Convention" in S. 2(b) referred to the Convention on Recognition and Enforcement of Foreign awards made at New York on 10-6-1958 to which India was a signatory-USSR, as it then was, acceded to the New York Convention on 24-8-1960-Ukraine acceded to the New York Convention on 10-10-1960- As per notification dated 7-2-1972 issued under S.2 by Ministry of Foreign Trade, Government of India regarding reciprocating territory, awards made in the territories of USSR could be enforced in India under the Act-Dissolution of USSR took place in or around December 1991-Held: on dissolution of USSR there was no requirement for issue of a new notification under S.2 recognising Ukraine as a reciprocating territory-Hence, award made in Ukraine is a foreign award which can be enforced in India under the Act.Section 7(1)(a)(iv)-Foreign award-Challenge of-Burden of proof-Party seeking to enforce award filed affidavit in High Court under R. 801 in Ch. XLIII of Bombay High Court Rules dealing with the Rules under the Foreign Award Act-Party challenging the award failed to put up its case before arbitrator and also failed to discharge burden before High Court-Party challenging award sought permission to produce fresh documents or evidence before Supreme Court for the first time to prove its case-Held: In the circumstances of the case, party challenging the award cannot be permitted to do so-Bombay High Court Rules, R. 801 Ch. XLIII-Practice and Procedure. Section 7(1)(a)(iv)-Foreign award-Enforcement-Challenge of-On the ground that the sole arbitrator was a high-ranking officer of the opposite party and award given by such arbitrator could not be enforced in India because it would be against public policy-Parties agreed to be governed by the law of the county where arbitration was held-Held: In the circumstances of the case, there is no violation of any public policy in enforcing the award in India when it was valid under the law of that country-Further, appointment of officer of one of the parties to the arbitration agreement, as a sole arbitrator, does not ipso facto make the arbitration or the award contrary to any public policy, especially if the officer had not personally handled any of the disputed transactions and is impartial. The 1st respondent, who was a wholly owned company of the then Government of USSR, appointed the appellants as its shipping agents for its business of shipping and carriage of goods to and from various India ports.In or around December, 1991, dissolution of the USSR took place. Several Socialist Republics, which had formed a part of the USSR, became ~ independent Sovereign States. The State of Ukraine also thus became an independent Sovereign State. The 1st respondent company became a company owned by the State of Ukraine.On 18-5-1992 an agency agreement was executed between the appellants and the 1st respondent, which contained an arbitration clause requiring the disputes to be referred to arbitration of the country where the owners were registered. The Convention referred to in Section 2(b) of the Foreign Award (Recognition and Enforcement) Act, 1961 is the Convention on the Recognition and Enforcement of Foreign Awards made at New York on l 0-6-1958 to which India was a signatory. The USSR, as it then was, acceded to the New York Convention on 24-8-1980. Ukraine acceded to the New York Convention on 10-10-1960. A notification dated 7-2-1972 was issued under Section 2 of the Act by the Ministry of Foreign Trade, Government of India regarding reciprocating territory whereby awards made in the territories of USSR could be enforced in India under the Act. Disputes arose between the appellants and the 1st respondent and, therefore, the 1st respondent invoked the arbitration clause in the agreement dated 18-5-1992. The second respondent was appointed as sole arbitrator to settle the disputes by arbitration at Ukraine. The appellants, however, did not file nay objections or reply to the statement of claim filed by the 1st respondent, nor did they appear before the arbitrator. As a result the arbitrator made and published her award in favour of the 1st respondent, who thereafter filed a petition in the High Court for enforcement of the foreign award. The High Court passed a decree in terms of the award made under the Act. Hence this appeal.On behalf of the appellants it was contended that, on the break-up of the USSR in or around December 1991, in the absence of a new notification recognising Ukraine as a reciprocal territory, awards made in Ukraine could not be enforced in India under the Act; that the arbitration was not conducted in accordance with the law of Ukraine and, therefore, permission should be granted to produce the arbitration law of Ukraine; and that the arbitrator was a high-ranking officer of the 1st respondent and an award given by her cannot be enforced in India because it would be against public policy.On behalf of the respondent it was contended that the appellants did not file any objections to the competence of the arbitrator in Ukraine; that the respondents had filed an affidavit under Rules 801 of Chapter XLIII of the Bombay High Court Rules dealing with Rules under the Act stating that the award had become final and binding as per Ukrainian law and that the appellants had not controverted this.
Judge	Hon'ble Ms. Justice Sujata V Manohar
Neutral Citation	1998 INSC 19
Petitioner	Transocean Shipping Agency (p) Ltd.
Respondent	Black Sea Shipping And Ors.
SCR	[1998] 1 S.C.R. 130
Judgement Date	1998-01-14
Case Number	112

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