Whether contravention of the Merchant Shipping Act, 1958 is conflict with the Public Policy of India under Indian Arbitration Law – Mercator Ltd. Vs. Dredging Corporation of India Ltd. – Delhi High Court
Certain legal principles relating to the exercise of jurisdiction under Section 48 of the Arbitration Act may be summarised:
A. The power to set aside an award vests only in the Courts at the seat of arbitration, which exercise “supervisory” or “primary” jurisdiction over the award. [Government of India Vs. Vedanta Ltd.
B. The jurisdiction of the Court in which enforcement is sought is a secondary jurisdiction, limited to the question of whether the award is enforceable in that particular jurisdiction. [Government of India Vs. Vedanta Ltd.
C. A judgment of the seat Court rejecting a challenge to the award is not binding under Section 48 of the Arbitration Act,11 but can be considered while deciding whether to permit relitigation of the issue before the enforcement court.
D. The public policy grounds for resisting enforcement of a foreign award under Section 48(2) of the Arbitration Act are limited to “narrow and international standards” of public policy,13 in contrast with the grounds available for challenging a domestic award under Section 34 of the Arbitration Act.
E. Similarly, while deciding questions of bias also, internationally recognised narrow standards of public policy, which reference the most basic notions of morality or justice, or shock the conscience of the Court, alone can be considered.
F. The Court can take into consideration the fact that a challenge on the ground in question was not raised before the seat Court.
G. Even when the grounds under Section 48 of the Arbitration Act are made out, the Court has discretion as to whether enforcement should be refused.
H. A review on the merits of the dispute does not fall within the jurisdiction of the Court under Section 48 of the Arbitration Act.