Indian Parties Can Opt For A Foreign Seated Arbitration

Introduction:

The Hon'ble Supreme Court of India in one of its most recent judgment has laid down that two Indian parties are entitled to select a foreign seat of arbitration. An arbitral award arising from such arbitration would be a foreign award. In the case of PASL Wind Solutions Pvt. Ltd. V. G.E Power Conversion India Pvt. Ltd¹, the Apex Court emphasized the significance of party autonomy in designating the seat of arbitration outside India even when both the parties happen to be Indian nationals. The party autonomy has been held to be the brooding and guiding spirit of arbitration. The Apex Court was faced with a situation where a settlement agreement dated 23.12.2014 was executed between the parties contained the dispute resolution clause, which reads as follows: