Kandla Export Corporation & Anr. v. M/s OCI Corporation - Supreme Court Important Judgment

 Kandla Export Corporation & Anr. v. M/s OCI Corporation - Supreme Court Important Judgment 2018 - 

On 7th February, 2018, in the case of Kandla Export Corporation & Anr. v. M/s OCI Corporation & Anr. [Civil Appeal Nos. 1661-1663 of 2018], the question for consideration was whether an appeal, not maintainable under Section 50 of the Arbitration and Conciliation Act, 1996, is nonetheless maintainable under Section 13(1) of the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015.

It was held that Section 50 of the Arbitration and Conciliation Act, 1996 is a provision contained in a self-contained code on matters pertaining to arbitration, and which is exhaustive in nature and that “Section 13(1) of the Commercial Courts Act, being a general provision vis-à-vis arbitration relating to appeals arising out of commercial disputes, would obviously not apply to cases covered by Section 50 of the Arbitration Act.”

It was held that “in all arbitration cases of enforcement of foreign awards, it is Section 50 alone that provides an appeal. Having provided for an appeal, the forum of appeal is left “to the Court authorized by law to hear appeals from such orders”. Section 50 properly read would, therefore, mean that if an appeal lies under the said provision, then alone would Section 13(1) of the Commercial Courts Act be attracted as laying down the forum which will hear and decide such an appeal.” 

The Supreme Court held that “given the objects of both the statutes, it is clear that arbitration itself is meant to be a speedy resolution of disputes between parties. Equally, enforcement of foreign awards should take place as soon as possible if India is to remain as an equal partner, commercially speaking, in the international community. In point of fact, the raison d’être for the enactment of the Commercial Courts Act is that commercial disputes involving high amounts of money should be speedily decided. Given the objects of both the enactments, if we were to provide an additional appeal, when Section 50 does away with an appeal so as to speedily enforce foreign awards, we would be turning the Arbitration Act and the Commercial Courts Act on their heads.”

It was held that “Section 13(1) of the Commercial Courts Act must be construed in accordance with the object sought to be achieved by the Act. Any construction of Section 13 of the Commercial Courts Act, which would lead to further delay, instead of an expeditious enforcement of a foreign award must, therefore, be eschewed. Even on applying the doctrine of harmonious construction of both statutes, it is clear that they are best harmonized by giving effect to the special statute i.e. the Arbitration Act, vis-à-vis the more general statute, namely the Commercial Courts Act, being left to operate in spheres other than arbitration.”