Two Indian Parties With A Foreign Seat: Easier Enforcement, But Nothing In The Interim

Whether or not, two Indian Parties may choose to have an arbitration seated outside India has been a vexed and often debated position. On one hand the Madhya Pradesh High Court in Sasan Power Limited vs. North American Coal Corporation India Pvt. Ltd.¹, had allowed two Indian parties to choose a foreign seat. Though this decision was appealed to the Supreme Court of India, it did not delve into this issue. Similarly, the Delhi High Court in the GMR Energy Limited vs. Doosan Power Systems India² had also permitted two Indian parties to choose a foreign seat. On the other hand, the Bombay High Court in Addhar Mercantile Private Limited vs. Shree Jagdamba Agrico Exports Pvt. Ltd.³, relying on TDM Infrastructure Pvt. Ltd. vs. Union of India⁴ held that a clause where two Indian parties had opted for a foreign seat was invalid. In TDM Infrastructure, the Supreme Court had said that two Indian parties cannot derogate from Indian substantive law. It did not make any specific