Summary
The Indian Supreme Court has recently reversed a judgment it
made in 2002, and has held that the power to set aside awards in
Section 34 of Part I of the Indian Arbitration Act ("the
Act") applies only to arbitrations seated in India. The
Supreme Court confirmed that "on a plain reading, Part I is
limited in its application to arbitrations which take place in
India". Part II of the Act deals with the recognition
and enforcement for foreign awards under the New York Convention
and limits judicial intervention in line with the Convention.
Whilst this is good news for foreign parties, the Supreme Court
also held (rather unfortunately) that its decision would only apply
to arbitration agreements executed after the date of the judgment
(6 September 2012). The previous difficulties and challenges
therefore remain for current arbitrations and future arbitrations
arising from contracts made before 6 September this year.
