R.D. Dhanuka JUDGMENT
R.D. Dhanuka, J.
1. By these two petitions filed under Section 34 of the Arbitration and Conciliation Act, 1996, the petitioners have impugned the arbitral awards dated 27th September 2014 and 17th December 2012 respectively in Arbitration No. 088 of 2012 in Arbitration Petition No. 690 of 2015, and the partial final award on jurisdiction dated 15th March 2013, partial final award on liability and reliefs (excluding costs) dated 3rd November 2013 read with final award on costs dated 2nd September 2014 passed by the arbitral tribunal in Arbitration No. 089 of 2012 in Arbitration Petition No. 757 of 2015 allowing some of the claims made by the respondent.
2. The respondent has raised an issue of maintainability of these two petitions on the ground that the parties had agreed that save for Section 9, Part I of the Indian Arbitration and Conciliation Act, 1996, the provisions of Part I of the Arbitration Act shall not apply to the terms of the Share Subscription Agreement and on other grounds.
3 In view of the preliminary objection raised by the respondent on maintainability of these two petitions under Section 34 of the Arbitration and Conciliation Act, 1996, this Court has heard the submissions of the learned senior counsel for both the parties on the maintainability of these two petitions at length. By consent of the parties, issue of maintainability raised in both these petitions is heard together and are being disposed of by this common order. Some of the relevant facts for the purpose of deciding the issue of maintainability are as under :-
4. The petitioner no. 1 is a Company incorporated under the provisions of the Companies Act, 1956 and has its registered office at Mumbai. The respondent is a Company incorporated under the laws of Mauritius and has its registered office at Mauritius. The respondent is an investment holding company for the Principal Investments Asia Division of HSBC.
5. On 21st April 2011, the petitioners and the respondent entered into a Share Subscription Agreement (hereinafter referred to as "SSA"). Some of the relevant clauses of the said SSA, which are relied upon by both the parties, are extracted as under :-
"Clause 15
15. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the laws of the Republic of India without regard to applicable conflict of Laws principles.
Clause 16
16. DISPUTE RESOLUTION
16.1 Arbitration
16.1.1 Any dispute, controversy or claim arising out of or in connection with this Agreement, including any question regarding its existence, validity, interpretation, breach or termination shall be referred to and finally resolved by binding arbitration at the Singapore International Arbitration Centre ("SIAC") in accordance with the Singapore International Arbitration Rules in force at the date of this Agreement ("Rules"), which Rules are deemed to be incorporated by reference into this clause and as may be amended by the rest of this clause.
16.1.2 The seat of arbitration shall be Singapore ...
16.1.6 The parties waive any right to apply to any court of law and/or other judicial authority to determine any preliminary point of law and/or review any question of law and/or the merits, in so far as such waiver may be validly made. The parties shall not be deemed, however, to have waived any right to challenge any award on the ground that the tribunal lacked substantive jurisdiction and/or the ground of serious irregularity affecting the tribunal, the proceedings or the award to the extent allowed by the law of the seat of the arbitration.
16.1.7 Nothing, in this Clause 16.1 shall be construed as preventing any party from seeking conservatory or interim relief in any court of competent jurisdiction ...
16.4 Application of Arbitration Act
Save for section 9, Part I of the Indian Arbitration and Conciliation Act, 1996 ("the Arbitration Act"), the provisions of Part I of the Arbitration Act shall not apply to the terms of this Agreement."
6. On 6th May 2011, the petitioner no. 1, respondent and their promotors and HAV3 Holdings (Mauritius) Ltd. and their investors entered into a Share Holders Agreement (hereinafter referred to as "SHA"). Clauses 18.1, 19.1 and 19.4 of the said SHA, which are relied upon by both the parties, are extracted as under :-
"Clause 18.1 of the said agreement provides that the same shall be governed by and construed in accordance with the laws of Republic of India without regard to applicable conflict Laws principles. Clause 19.1 provides for arbitration at Singapore International Arbitration Centre in accordance with SIAC Administered Arbitration Rules in force. Clause 19.4 provided that save for section 9 of Part 1 of the Indian Arbitration and Conciliation Act, 1996, the provisions of Part I of the Arbitration Act shall not apply to the terms of that agreement."
7. On 11th May 2012, the respondent herein invoked arbitration agreements in SSA and SHA being Singapore International Arbitration Centre (SIAC) i.e. Arbitration Nos. 088 of 2012 and 089 of 2012 respectively and sought emergency reliefs under the emergency arbitration provisions of SIAC 2010 Rules. On 14th May 2012, SIAC appointed Mr. Thio Shen Yi S.C. as emergency arbitrator.
8. On 28th and 29th May 2012, the said emergency arbitrator made an interim award in SSA and SHA arbitrations respectively inter alia freezing of the accounts of the petitioners, requiring them to disclose to HSBC Mauritius information of their assets and to deliver the requested information. The learned emergency arbitrator also provided for various expenses allowed to be spent by the petitioners. The respondent called upon the petitioner no. 1 to make their share of payment towards the first tranche of deposit.
9. On 17th December 2012, the arbitral tribunal passed an unanimous partial award in the SSA arbitration dismissing the jurisdictional challenge of the petitioners and declared that (a) Indian law was not governing the law of arbitration and it was Singapore law that governed the arbitration agreements; (b) under Singapore law, allegations of fraud and/or complicated issues of fact and law were arbitrable; and (c) the arbitral tribunal had jurisdiction to adjudicate the dispute arising under the SSA between the petitioners and the respondent. On 15th March 2013, the arbitral tribunal passed an unanimous partial award in SHA arbitration dismissing the jurisdictional challenge of the petitioners and declaring that the Singapore law determined the jurisdiction of the tribunal and based on Section 11 of the Singapore International Arbitration Act read with Article 34 of Model Law, Singapore law governed the arbitrability of disputes, issues of fraud were arbitrable under Singapore law and arbitration of the claims of the respondent herein were not contrary to Singapore public policy and that the claims of the respondent were arbitrable. The arbitral tribunal thereafter made a final award in both the matters.
10. The respondent filed Arbitration Petition No. 1062 of 2012 in this Court inter alia praying for various interim measures against the petitioners herein. The said arbitration petition was opposed by the petitioners herein on various grounds including on the ground of maintainability of the said arbitration petition filed under Section 9 of the Arbitration Act before this Court.
11. By an order and judgment dated 22nd January 2014 passed by this Court, learned Single Judge granted interim measures in favour of the respondent thereby restraining the petitioners from withdrawing the amount retained in the Corporation Bank Account of the petitioners to the extent of US $ 60 million.
12. The petitioners herein filed a Special Leave Petition and impugned the said order and judgment dated 22nd January 2014 passed by the learned Single Judge of this Court in the Arbitration Petition No. 1062 of 2012. In view of the objection raised by the respondent herein that the impugned order was appealable under Section 37(1)(a) of the Arbitration and Conciliation Act, 1996, the petitioners herein sought liberty to withdraw the said Special Leave Petition to enable the petitioners to challenge the impugned order passed by the learned Single Judge in an appeal under Section 37(1)(a) of the Arbitration and Conciliation Act, 1996 before the Division Bench of this Court. The Supreme Court accordingly allowed the petitioners to withdraw the petition with liberty as prayed and dismissed the said petition.
13. Pursuant to the said liberty granted by the Supreme Court, the petitioners herein preferred an appeal (190 of 2014) before the Division Bench of this Court and impugned the said order and judgment dated 22nd January 2014 passed by the learned Single Judge in Arbitration Petition No. 1062 of 2012.
14. By an order and judgment dated 31st July 2014, Division Bench of this Court partly allowed the said appeal and substituted the operative part of the order of the learned Single Judge by directing the petitioners herein to deposit the short-fall in the Corporation Bank Account of the petitioners so as to maintain the balance of US $ 30 million within four weeks from the date of the said order and upheld rest of the directions in the said order and judgment dated 22nd January 2014. The petitioners have impugned the said order and judgment of the Division Bench before the Supreme Court of India and the said Special Leave Petition is pending.
15. Mr. Sancheti, learned senior counsel for the petitioners placed reliance on clauses 15, 16, 16.1.6 and 16.4 of the SSA and would submit that clause 16 provides for a reference of disputes to Arbitration at Singapore International Arbitration Centre (SIAC) and in accordance with Rules in force at SIAC, seat of arbitration being at Singapore. He submits that however, clause 16.1.6 provides for waiver by the parties to apply to any Court of law to determine any preliminary point of law or review or any question of law and/or merits. He laid emphasis on the words " the parties shall not be deemed, however, to have waived any right to challenge any award..." He submits that the rights of the parties to challenge the award is expressly kept open.
16. It is submitted by the learned senior counsel that clause 16.4 of the SSA dealt with the aspect relating to 'Curial Law,' which is distinct from the other two aspects i.e. (i) proper law governing the contract or the law governing the substantive rights of the parties under the contract and (ii) the law of arbitration agreement. Learned senior counsel placed reliance on paragraph 5 of the Judgment of the Supreme Court in the case of Sumitomo Heavy Industries Ltd. Vs. ONGC Ltd., reported in MANU/SC/0834/1998 : (1998) 1 SCC 305 and would submit that in this case, the parties having expressly agreed to be governed by Indian Law as substantive law of contract, such law would also govern the arbitration agreement between the parties.
17. Learned senior counsel submits that Curial Law operates during the continuance of the proceedings before the arbitrator to govern the procedure and conduct thereof. Such authority of Courts administering the curial law ceases when the proceedings before the arbitrator are concluded. He submits that clause 16.4 of the SSA cannot be read to mean that the parties had waived their right to challenge the award under Section 34 of the Arbitration and Conciliation Act, 1996 as that was not in the realm of curial law at all. In support of this submission, learned senior counsel placed reliance on clause 16.1.6 of the said agreement.
18. It is submitted by the learned senior counsel for the petitioners that the manner in which a portion of clause 16.1.6 is framed, in particular, the positioning the words "and/or" regarding the grounds of challenge and thereafter positioning of a comma between the words " the tribunal" and "the proceedings" but the absence of any comma after the words "the award" leaves no manner of doubt that the provision of Part I to challenge any award were not excluded per se. In support of this submission, learned senior counsel placed reliance on the judgment of this Court in the case of Sayed Mohamed Masood Vs.Dr. Shanmugham, Directorate of Enforcement and Anr. delivered on 4th February 2013 in Criminal Bail Application No. 71 of 2013 and in particular paragraphs 10 to 14 thereof. He submits that the right to challenge an arbitral award protected under clause 16.1.6 is not overridden by clause 16.4 and thus, this Court had entertained the appeal filed by the petitioners under Section 37(1)(a) of the Arbitration and Conciliation Act, 1996 by which the petitioners had impugned the order and judgment delivered by the learned Single Judge which was passed under Section 9 of the Arbitration Act.
19. Learned senior counsel placed reliance on the order passed by the Supreme Court in Special Leave to Appeal (Civil) No. 4991 of 2014 which was filed by the petitioners herein impugning the order and judgment dated 22nd January 2014 in Arbitration Petition No. 1062 of 2012. He submits that the respondent herein had raised an objection about maintainability of the said petition which was filed by the petitioners impugning the order passed by the learned Single Judge under Section 9 of the Arbitration and Conciliation Act, 1996 on the ground that the said order was appealable under Section 37(1)(a) of the Arbitration and Conciliation Act, 1996. He submits that it is thus clear beyond reasonable doubt that since the provision of appeal under Section 37(1)(a) of the Arbitration and Conciliation Act, 1996 was applicable to the proceedings filed by the petitioners, the proceedings under Section 34 of the Arbitration and Conciliation Act, 1996 for impugning the arbitral award which provision also falls under Part I of the Arbitration and Conciliation Act, 1996 is applicable and is not thus excluded.
20. Mr. Sancheti, learned senior counsel for the petitioners made an attempt to distinguish the judgment of this Court dated 22nd January 2014 on the ground that the said judgment was based on a collective reading of clause 16.1.2 read with clause 16.4 and was rendered in proceedings filed under Section 9 of the Arbitration and Conciliation Act, 1996. He submits that the proceedings, at that stage, factually fall within the purview of curial law and thus the said judgment though between the same parties cannot be applied to the facts of this case on the issue of maintainability of these two petitions filed under Section 34 of the Arbitration and Conciliation Act, 1996.
21. It is submitted by the learned senior counsel for the petitioners that the Supreme Court in the case of Bharat Aluminium Company Vs. Kaiser Aluminum Technical Services Inc., reported in MANU/SC/0722/2012 : (2012) 9 SCC 552 held that Part I of the Arbitration and Conciliation Act, 1996 applicable only to arbitrations which take place within the territory of India is prospective and since the agreements entered into between the parties herein were entered into prior to the pronouncement of the said judgment, the said judgment would not apply to the facts of this case.
22. In so far as the judgment of the Division Bench in the case of Konkola Copper Mines (PLC) & Anr.Vs. Stewarts & Lloyds of India Ltd. & Anr., reported in MANU/MH/0927/2013 : 2013 (5) Bom.C.R. 29 is concerned, it is submitted by the learned senior counsel for the petitioners that the said judgment would not apply to the facts of this case. It is submitted that the judgment in the case of Bhatia International Vs. Bulk Trading S.A., reported in MANU/SC/0185/2002 : (2002) 4 SCC 105 would apply to the present case. He submits that in the case of Bhatia International (supra), it was clearly held that the provisions of Part I are equally applicable to International Commercial Arbitrations held outside India. He submit that in the present case, relationship between the parties is governed by Indian Law.
23. Learned senior counsel placed reliance on the judgment of the Supreme Court in the case of Venture Global Engg. Vs. Satyam Computer Services Ltd., reported in MANU/SC/0333/2008 : (2008) 4 SCC 190 in support of his submission that applicability of Part I was not excluded by the parties. He submits that the judgment of the Supreme Court in the case of Reliance Industries Ltd. & Anr. Vs. Union of India, reported in (2014) 7 SC 603 and in the cases of National Thermal Power Corporation Ltd. Vs. Singer Company & Ors., reported in MANU/SC/0146/1993 : (1992) 3 SCC 551 and Sumitomo Heavy Industries Ltd.(supra) would not be applicable to the present case.
24. In so far as the judgment of the Supreme Court in the case of Harmony Innovation Shipping Ltd. Vs. Gupta Coal India Ltd. & Anr., reported in MANU/SC/0231/2015 is concerned, learned senior counsel for the petitioners submits that in the said judgment, the Supreme Court has considered the facts where the parties had agreed to English law being substantive law, seat of arbitration at London and Rules of London Maritime Arbitration Association were made applicable. He submits that however, in the facts of this case, there was no controversy as to the applicable law being different on different aspects. Learned senior counsel made an attempt to distinguish the judgment of the Supreme Court in the case of Harmony Innovation Shipping Ltd. (supra).
25. Mr. Khambatta, learned senior counsel for the respondent, on the other hand, submits that there is no dispute that both the agreements i.e. SSA and SHA were entered into between the parties prior to 6th September 2012 when the judgment of the Supreme Court in the case of Bharat Aluminium Company (supra) was delivered which has held that on and from 6th September 2012, Part I of the Arbitration Act would not apply to foreign-seated arbitration. He placed reliance on clauses 15, 16.1, 16.1.1, 16.1.2, 16.1.3, 16.1.4, 16.1.5, 16.1.6, 16.1.7 and 16.4 of the said SSA and clauses 18.1, 19.1, 19.3 and 19.4 of the said SHA and submits that the parties had agreed that (i) the governing law of contract as Indian Law; (ii) the seat of arbitration as Singapore; (iii) the arbitration is to be conducted at the Singapore International Arbitration Centre (SIAC); (iv) the arbitration is governed by the Singapore International Arbitration Rules (SIA Rules); (v) SIAC is the authority that is to appoint the arbitrators in the event of any failure to nominate the arbitrator; (vi) Express exclusion of Part I of the Act, save and except Section 9 of the Act; (vii) Articles 16.1.6 of SSA and 19.1 of SHA permit challenge to the award on certain grounds to the extent permitted by the law of the seat of the arbitration which also indicates that the parties contractually intended that the award would be challengeable at the seat of the arbitration.
26. Learned senior counsel placed reliance on the judgment of the Supreme Court in the case of Bhatia International (supra) and in particular paragraph 32 thereof and would submit that according to the said judgment, unless the parties by agreement, express or implied, had excluded all or any of Part I of the Arbitration and Conciliation Act, 1996, in the cases of international commercial arbitrations held out of India provisions of Part I would apply. He submits that since the parties in this case had excluded Part I of the Arbitration and Conciliation Act, 1996, except Section 9, under clause 16 of the SSA and clause 19 of the SHA respectively, these two petitions which are filed under Section 34 of the Arbitration and Conciliation Act, 1996 are not maintainable and thus deserve to be dismissed in limine on that ground alone.
27. Mr. Khambatta, learned senior counsel for the respondent in support of his submission also placed reliance on various paragraphs of the order and judgment dated 22nd January 2014 delivered by the learned Single Judge of this Court in Arbitration Petition No. 1062 of 2012 between the same parties arising out of the same contract, decided under Section 9 of the Arbitration and Conciliation Act, 1996 and in particular paragraph 73 thereof. He also placed reliance on paragraphs 22, 25 and 41 of the judgment delivered on 31st July 2014 by the Division Bench of this Court in Appeal No. 190 of 2014 holding that in the present case, the law governing the arbitration agreement is Singapore law. The Division Bench has also held that in light of categorical provisions contained in SSA and SHA, it is clear that the parties have expressly or in any case by implication agreed that the law of arbitration shall be the SIAC Rules i.e. laws of Singapore. The Division Bench negatived the contentions of the petitioners herein and held that there was no merit in the submission of the petitioners herein that the law governing the arbitration in the present case was the Indian law. The Division Bench also held that there was no dispute whatsoever that the law governing the arbitration agreement in the present case was the Singapore law.
28. Learned senior counsel for the respondent placed reliance on the judgment of the Supreme Court in the case of Reliance Industries Ltd.(supra) and in particular paragraphs 43, 51 and 52 and submits that the law which would apply to the filing of the award, to its enforcement and to its setting aside would be the law governing the agreement to arbitrate and the performance of that agreement.
29. Learned senior counsel for the respondent, without prejudice to the rights and contentions of the respondent, submits that under clause 16 of SSA and clause 19 of SHA, the parties had expressly excluded Part I of the Arbitration and Conciliation Act, 1996 except Section 9, the parties have impliedly excluded the applicability of Part I of the Arbitration Act except Section 9 under SSA and SHA by agreeing that the juridical seat of arbitration under SSA and SHA being in Singapore and the SSA arbitration and the SHA arbitration being conducted under SIA Rules. He submits that on account of the juridical seat of arbitration being in Singapore, the provisions of the Singapore International Arbitration Act would mandatorily apply to the SSA arbitration and SHA arbitration. He submits that under Section 5 of the Singapore Act, Part II of the Singapore Act and the Model Law would apply to international arbitrations in Singapore unless the parties specifically provided that the same shall not apply which is not the case under the SSA and the SHA. He submits that under Article 34 of the Model law titled as "Application For Setting Aside As Exclusive Recourse Against Arbitral Award" which may be made only by an application for setting aside in accordance with the said Article. It is submitted that in any event the applicability of Part I of the Arbitration and Conciliation Act, 1996 except Section 9 has been excluded by necessary implication under the SSA as well as the SHA. He submits that the choice of a seat of arbitration carries with it the choice of the law of the seat being the law that governs the arbitration agreement and the arbitration.
30. Learned senior counsel for the respondent also placed reliance on the judgment of the Supreme Court in the case of Harmony Innovation Shipping Ltd.(supra) and also the judgment of Division Bench of this Court in the case of Harkirat Singh Vs. Rabobank International Holding B.V. decided on 20th January 2015 in Appeal No. 171 of 2007 holding that if the juridical seat of arbitration is in another country where the provisions of the arbitration law of that country which deal with challenges to an arbitral award, are mandatory provisions having the effect. Notwithstanding any agreement to the contrary, the award can only be challenged under the relevant provisions of the law of that country and not under Section 34 of the Arbitration Act. He also placed reliance on the judgment delivered by the learned Single Judge in the case of Pol India Projects Limited Vs. Aurelia Reederei Eugen Friederich GmbH Schiffahrtsgesellschaft & Co. KG on 8th April 2015 in Arbitration Petition No. 76 of 2012.
31. In so far as the submission of the learned senior counsel for the petitioners that in view of clause 16.1.6 of SSA and clause 19.1 of SHA, the petitioners are not precluded from challenging the arbitral award is concerned, he submits that the said two provisions permit challenge to the award on certain grounds to the extent permitted by the law of the seat of the arbitration which also indicates that the parties contractually intended that the award would be challengeable at the seat of the arbitration.
32. In so far as the submission of the learned senior counsel for the petitioners that in view of the order passed by the Supreme Court on 11th April 2014 granting liberty to the petitioners to withdraw the said Special Leave to Appeal (Civil) No. 4991 of 2014 and to file an appeal under Section 37(1)(a) of the Arbitration Act before the Division Bench of this Court and in view of the objection raised by the respondent herein, the petitioners are entitled to file these two petitions under Section 34 of the Arbitration Act is concerned, learned senior counsel submits that the appeal is a continuation of the original proceedings and in view of the respondent herein having filed the petition under Section 9 of the Arbitration and Conciliation Act, 1996 in view of the express exclusion of part I except section 9 under clauses 16.4 of SSA and 19.1 of SHA, the petitioners could not have filed the petition under Section 34 of the Arbitration and Conciliation Act, 1996. The remedy of the petitioners herein to file an appeal under Section 37(1)(b) of the Arbitration and Conciliation Act, 1996 against the said order passed by this Court under Section 9 was not taken away.
33. Mr. Khambatta, learned senior counsel for the respondent also distinguished the judgment of this Court in the case of Sayed Mohamed Masood (supra) on the ground that in paragraph 14 of the said judgment, this Court had clarified that it was not necessary to go into the arguments of interpretation of the said provisions since the definition was only for the purpose of rules which have been framed for the restricted purpose of clauses (a) & (p) of sub-section (2) of Section 73 of the Prevention of Money Laundering Act, 2002.
34. Mr. Sancheti, learned senior counsel for the petitioners in rejoinder makes an attempt to distinguish the judgment of this Court in the case of Pol India Projects Limited (supra) on the ground that the provisions in the agreement between the parties to the said proceedings were totally different. Similarly, he also makes an attempt to distinguish the judgment of the Supreme Court in the case of Harmony Innovation Shipping Ltd. (supra) in which the governing law agreed between the parties was the rules of London which is not the case in these matters. He submits that appeal under Section 34 is not a continuation of the original proceedings. The right of appeal is a statutory right. He submits that the judgment of the Supreme Court in the case of Venture Global Engg. (supra) would be applicable.
35. There is no dispute between the parties that the respondent had filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996 for interim measures against the petitioners herein in this Court. The petitioners had opposed the said arbitration petition on various grounds including on the ground of jurisdiction of this Court. By the judgment and order dated 22nd January 2014 rendered by this Court after considering various provisions of both the agreements and after considering the submissions of both the parties including the issue of jurisdiction and after considering various judgments of the Supreme Court including the judgments in the cases of Sumitomo Heavy Industries Ltd.(supra), National Thermal Power Corporation Ltd. (supra), Konkola Copper Mines (PLC)(supra) and the judgment of the Supreme Court in the case of Bharat Aluminium Company (supra), it is held by this Court that it was not intended by the parties that the Indian law would apply to the main agreement as well as to the arbitration agreement.
36. On perusal of clause 15 of the agreement, this Court held that admittedly, arbitration proceedings were held at Singapore in accordance with Singapore International Arbitration Rules. It is also not in dispute that the parties have agreed that the seat of arbitration shall be at Singapore. This Court has held that agreement to arbitrate at Singapore has a closer and real connection with the place where the parties had chosen to arbitrate. The arbitration agreement would be thus governed by the law of Singapore and not Indian law. This Court held that the judgments of the Supreme Court in the case of Sumitomo Heavy Industries Ltd.(supra) and in the case of National Thermal Power Corporation Ltd. (supra) shall be squarely applicable to the facts of this case. This Court also followed the judgment of the Division Bench of this Court in the case of Konkola Copper Mines (PLC) (supra) in which the Division Bench of this Court has interpreted the judgment of Supreme Court in case of Bharat Aluminium Company (Supra) and has held that the entire judgment in that case would not apply with prospective effect. It is held that in so far as applicability of the law of governing based on arbitration is concerned, the seat of arbitration would determine the governing law of arbitration agreement. This Court has held that in this case also the express choice of the parties was that the seat of arbitration would be at Singapore and thus the seat of arbitration would govern the law of agreement i.e. law of Singapore and not Indian law in this case. This Court has specifically rejected the plea of the petitioners herein that clause 16.4 of the agreement did not oust Indian law and held that whether the dispute raised by the respondent was arbitrable or not would have been decided as per law of Singapore and not as per Indian law.
37. Learned Single Judge of this Court also held that since the law of Singapore would apply to the parties in these proceedings and under the laws of Singapore, the petitioners herein would have remedy of challenging the interim award before the appropriate Court at Singapore and the petitioners not having challenged the said jurisdictional award and the interim award, the said jurisdictional award and interim award made by the arbitral tribunal between the same parties arising out of the same agreement in the arbitration proceedings have become final and conclusive on the issue of jurisdiction and the petitioners herein were barred by the principles of estoppel in re-agitating the same issue in the said petition filed under Section 9 of the Arbitration Act. It is not in dispute that the arbitral tribunal had already taken a view that the Court at Singapore determined the jurisdiction of the arbitral tribunal. In the partial award dated 17th December 2012, the arbitral tribunal had declared that Indian law was not governing the law of arbitration agreement and it was the Singapore law that governs the arbitration agreement.
38. A perusal of the said order passed by the learned Single Judge clearly indicates that all these issues which are now raised by the petitioners on the issue as to whether Part I of the Indian Arbitration and Conciliation Act, 1996 was excluded or not by express agreement or by implication have been dealt with by this Court in the said judgment and have been decided.
39. A perusal of the order passed by the Division Bench of this Court in appeal also clearly indicates that the Division Bench has not interfered with the order passed by the learned Single Judge on various issues including the issue as to whether Part I excluding Section 9 was expressly excluded by the parties. In the present case, the law governing the arbitration would be the law of Singapore. The Division Bench also interpreted clauses 15, 16 and 16.4 of SSA and has held that save and except Section 9 of the Arbitration and Conciliation Act, 1996 Part I thereof would not apply to the terms of the arbitration agreement. It is held that in light of categorical provisions contained in SSA and SHA, it was clear that the parties have expressly or in any case by implication agreed that the law of arbitration shall be the SIAC Rules i.e. laws of Singapore.
40. The Division Bench also applied the principles laid down by the Supreme Court in the case of Konkola Copper Mines (PLC)(supra) interpreting the judgment of the Supreme Court in the case of Bharat Aluminium Company (supra). The Division Bench has held that there cannot be any fault in the decision of the learned Single Judge that the parties either expressly, or in any case by implication intended to exclude the applicability of Part I of the Arbitration Act, save and except Section 9 thereof which was clear from reference to clause 16 of SSA as well as analogous clauses in SSA. In paragraph 25 of the said judgment, the Division Bench has held that there was no merit in the submission of the petitioners herein that the law governing arbitration in the present case was the Indian law. It is not in dispute that though the petitioners have filed Special Leave Petition impugning the order and judgment passed by the Division Bench on 31st July 2014, the law laid down by the learned Single Judge as well as by the Division Bench of this Court has not been set aside by the Supreme Court till date.
41. In my view, the judgments of the learned Single Judge and of the Division Bench between the same parties interpreting the same clauses of SSA and SHA holding that the parties had agreed that except Section 9, Part I of the Indian Arbitration and Conciliation Act, 1996 was excluded are binding on this Court. Learned senior counsel for the petitioners is unable to convince this Court as to why the said two judgments are not applicable to the present petitions filed under Section 34 of the Arbitration and Conciliation Act, 1996. In my view, on plain reading of clause 16.4 of SSA and clause 19.4 of SHA, it clearly indicates that except Section 9, the entire part of the Indian Arbitration and Conciliation Act, 1996 is expressly excluded including Section 34 of the said Act.
42. Be that as it may, the said two judgments have been rendered by this Court based on the law laid down by the Supreme Court in several judgments referred to by this Court therein which are squarely applicable to the facts of this case.
43. In my view, the parties have even otherwise impliedly excluded the provisions of Part I of the Arbitration and Conciliation Act, 1996 under both the agreements by agreeing that (i) the governing law of contract as Indian Law; (ii) the seat of arbitration as Singapore; (iii) the arbitration is to be conducted at the Singapore International Arbitration Centre (SIAC); (iv) the arbitration is governed by the Singapore International Arbitration Rules (SIA Rules); (v) SIAC is the authority that is to appoint the arbitrators in the event of any failure to nominate the arbitrator.
44. This Court in the cases of Harkirat Singh Vs. Rabobank International Holding B.V. (supra) and Pol India Projects Limited (supra), the Division Bench of this Court in the case of Sakuma Exports Ltd. Vs. Louis Dreyfus Commodities Suisse S.A. delivered on 6th August 2013 in Appeal No. 337 of 2013 and the Supreme Court in the case of Sakuma Exports Ltd. Vs. Louis Dreyfus Commodities Suisse S.A. delivered on 28th March 2014 in Special Leave to Appeal (Civil) No. 27404 of 2013, in the case of Reliance Industries Ltd. (supra) and in the case of Harmony Innovation Shipping Ltd. (supra) have held that if the juridical seat of arbitration is outside India, Part I of the Arbitration and Conciliation Act, 1996 would not apply. I am respectfully bound by the aforesaid judgments of the Supreme Court and this Court which are applicable to the facts of this Court. It is not in dispute that the said foreign award is governed by the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Articles V and VI of the said New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards require that the said award can only be set aside or suspended by a competent authority of the country in which or under the law of which or under the law of which that award was made. In my view the said foreign award thus could be challenged by the petitioners only under the relevant provisions of law of that country and not under section 34 of the Indian Arbitration and Conciliation Act, 1996.
45. The Supreme Court in the case of Bhatia International (supra) held that in the cases of international commercial arbitrations held outside India, the provisions of Part I would apply unless the parties by agreement, express or implied, had excluded all or any of the Part I of the Arbitration and Conciliation Act, 1996. The said judgment squarely applies to the facts of this case. In my view, the parties in this case have by express agreements agreed that the provisions of Part I except Section 9 thereof would be excluded. In my view, the parties have thus by express agreement or in any event impliedly excluded Part I in view of the provisions of SSA and SHA. In my view choice of seat of arbitration carries with it the choice of law of the seat being the law that govern the arbitration agreement and the arbitration.
46. In my view, since the entire Part I except Section 9 of the Arbitration and Conciliation Act 1996 is expressly or in any case impliedly excluded, both these petitions filed under Section 34 of the Arbitration and Conciliation Act 1996 are thus not maintainable.
47. In so far as the submission of the learned senior counsel for the petitioners that in view of the liberty granted by the Supreme Court to the petitioners to file an appeal under Section 37(1)(a) against the order passed by the learned Single Judge under Section 9 of the Arbitration and Conciliation Act, 1996, these two petitions under Section 34 also would be maintainable is concerned, in my view, there is no merit in this submission of the learned senior counsel for the petitioners. Since the respondent had filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996, in view of the agreements between the parties that Section 9 was not excluded, the respondent herein had rightly raised an objection before the Supreme Court in Special Leave Petition filed by the petitioners directly against the order passed by the learned Single Judge of this Court under Section 9 that an appeal could be filed under Section 37(1)(a) which was a statutory appeal against the order passed by the learned Single Judge under Section 9.
48. In my view, merely on the basis of that statement and the liberty granted by the Supreme Court, Section 34 of the Arbitration and Conciliation Act, 1996 against the said foreign awards cannot stand attracted to the present proceedings. There is thus no merit in the submission of the learned senior counsel for the petitioners.
49. In my view, there is no merit in the submission of the learned senior counsel for the petitioners that there was no waiver on the part of the petitioners to file arbitration petition under Section 34 of the Arbitration and Conciliation Act, 1996. In my view, under clause 16.1.6 of SSA and clause 19.1 of SHA, the parties were permitted to challenge the award on certain grounds to the extent permitted by the law of the seat of the arbitration which, in my view, could only be under the laws of Singapore and not the Indian law. This Court has already taken such a view in the aforesaid two orders and judgments passed by this Court arising out of Section 9 proceedings that even the interim award could be challenged only under the laws of Singapore and not under the Indian law.
50. I therefore pass the following order :-
Arbitration Petition Nos. 690 of 2015 and 757 of 2015 are dismissed as not maintainable. There shall be no order as to costs.
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