Breaking: The Supreme Court today overruled the doctrine laid down in its own year 2002 landmark Bhatia International v Bulk Trading SA & Anr case, which held that Indian courts had exclusive jurisdiction to test the validity of an arbitral award made in India even when the proper law of the contract is the law of another country.
The constitution bench of Chief Justice of India SH Kapadia and justices Jain, Nijjar, Khehar and Desai heard the appeal of Bharat Aluminium Company against Kaiser Aluminium Technical Services – the test case relating to Bhatia International.
The judges held, according to Legally India blogger Courtwitness1, that part 1 of the Arbitration Act does not apply to international arbitration and that the seat of arbitration will determine jurisdiction of the court.
Senior advocate Gopal Subramanium who was acting for Bharat Aluminium had contended the opposite earlier this year. He argued that the seat of arbitration was not the basis on which the jurisdiction of the courts had been defined under the Indian Arbitration Act.
The correct approach to jurisdiction under the Indian Act drew from the principle of party autonomy, the significance of choice of law, English law and from the travaux préparatoires to the UNCITRAL Model Law on International Commercial Arbitration.
More than 30 counsel including 10 senior advocates had appeared in the various civil appeals and special leave petitions (SLPs) associated with the Supreme Court hearings that started around 10 January. Former Amarchand Mangaldas equity partner Ciccu Mukhopadhaya, who was designated senior counsel in December 2011, was also appearing for the respondents.