Do we need a ‘World Court’? Well! Considering the pace at which our world is fast becoming a global village, a world court is one such idea whose time has come. Yes, there are certain international courts Viz. International Court of Justice in Hague, International Criminal Court in Hague again etc. but the extent of their jurisdiction and the scope of enforceability of the judgments and awards passed by them is certainly an issue of concern and has rightly perturbed not only the legal experts across he world but also the Statesmen and politicians.
Enforceability of Foreign judgments and awards passed by the courts located outside the politicogeographical boundary of a country is a grey area of International Law and involves complex issues of law. The tall and steep walls of Sovereignty protecting the unchallenged supremacy of the Nations in their international and intra-national affairs are probably the biggest hurdle in the enforceability of foreign awards and judgments.
As is the case with the third world countries, enforceability of foreign judgments in India has attracted mixed reactions from the legal experts across the world. If perceiver’s view of reality is to be believed then enforcing a foreign judgment or award in India is a tough nut to crack. However, the reality is substantially different from the above mentioned perceivers view of reality. The position of Indian legal system is crystal clear with respect to enforceability of Foreign Judgments and awards in India. Let’s make an attempt to reproduce it.
The Indian Legal System categorizes Foreign Judgments and Awards from all the quarters of the world into two groups Viz. (a) Judgments and Awards coming from the ‘Reciprocating Territories’ of India and (b) Judgments and awards coming from the ‘Non-Reciprocating Territories’ of India. Let’s first examine the enforceability of Judgments from the non-reciprocating territories of India.
The Judgments coming from the ‘non-reciprocating territories’ of India are required to pass through the sieve of ‘Indian Judiciary’ before they could be enforced. In other words, for enforcing a foreign Judgment or an Award from a ‘Non-Reciprocating Territory’ of India, a fresh suit in an Indian Court with appropriate Jurisdiction needs to be instituted. Further, Judgments from a ‘Non-Reciprocating Territory’ only have evidentiary and persuasive value in the eyes of India Judiciary and they must be filed for enforcement within three years from the day when they were originally passed.
However, it does mean that scope of enforceability of Foreign Judgments from ‘Non-Reciprocating Territories’ in India is limited or the approach of Indian Judiciary is parochial. No doubt that Foreign Judgments from Non-Reciprocating Territories need to pass through the sieve of Indian Judiciary but the sieve used is broad and spacious enough to allow the sink in of ‘the cause of Justice’ upheld by the courts of Foreign Countries.
In the case of Formosa Plastic Corporation Ltd. Vs. Ashok Chauhan & Ors.1 the Hon’ble High Court of Delhi emphatically reiterated the well settled principle of law in India with respect to foreign Judgments. The principle states that “it is not open to the Court trying the suit on a foreign judgment to decide whether the decision of the foreign Court on the materials put before it is right or not”.
The Court further observed that while adjudicating the suit on a foreign judgment, the duty of the Court is “merely” to see that the foreign Court has applied its mind to the facts of the case and the law on the point.
The Hon’ble High Court of Delhi firmly established the above mentioned principle by citing an old Judgment delievered in the case of Dr. Kulwant Vs. Dhan Raj Dutt2. In this case it was held that if a foreign court has strictly followed ‘the procedure’ and has given full opportunity to the defendant to appear and raise a defense, then, even if that judgment is passed ex-parte it shall be considered to have been decided on merits.
Shalig Ram Vs. Firm Daulatram Kundanmal3
In this case a summary suit was instituted in the Bombay High Court. The defendant, at that point in time, was a resident of the former State of Hyderabad (a foreign territory). The defendant, however, appeared in obedience to the process of the Court and applied for leave to defend the suit without any objection to the jurisdiction of the High Court of Bombay. The defendant was granted the leave to defend.
The Court, within the prescribed time but on the default of the defendant, passed an ex parte decree against the defendant. The decree was transferred to a Court in Hyderabad, interestingly, a foreign Court at that juncture of history. The defendant took an objection that the decree of a foreign court was not executable.
It was ultimately decided by the Hon’ble Supreme Court of India that once the defendant has submitted to the jurisdiction of a foreign Court, a decree passed by that court, even if ex-parte, is a valid foreign decree.
Moving on, let’s try to examine the scope of enforceability of judgments coming from the Reciprocating Territories of India.
What is a Reciprocating Territory?
The definition, explanation and scope of Reciprocating Territories of India flows from section 44-A of the Code of Civil Procedure,1908 (the Code). A bare perusal of section 44-A of ‘the code’ suggests that a reciprocating territory means any country or territory outside India which the Central Government may by notification in the official gazette, declare to be a reciprocating territory for the purpose of section 44-A.
Interestingly, a decree passed by a ‘superior court’ located in any of the reciprocating territories, as notified by the Union of India, can be executed in India merely by filing a certified copy of that decree in the concerned District court of India. On filing a certified copy of the decree from a ‘Superior Court’, the concerned District court in India may treat the decree as if it was passed by itself. For the purpose of this section a ‘superior court’ would mean any such court in a reciprocating territory, as may be specified in the notification for Receprocating Territories. Further, as per the explanation given in ‘the code’ a decree for the purpose of this section would mean any decree or judgment of a superior court under which a sum of money is payable, not being a sum payable in respect of taxes or other charges of a like nature or in respect of a fine or other penalty. The section further prescribes that such a decree shall in no case include an arbitration award, even if such an award is enforceable as a decree or judgment.
In the case of N.P.A.K. Muthiah Chettiar (died) and Ors. Vs. K.S. Rm. Firm Shwebo, Burma and Ors.4, the Hon’ble High Court of Madras observed that with regard to decrees of a reciprocating territory contemplated in the explanation to Section 44-A no suit is necessary but the same can be executed by the application of the provisions of Section 47, Civil P. C. The distinction that has to be borne in mind is that reciprocating territories enjoy greater privilege regarding execution of decrees of their superior Courts in our country than are enjoyed by the non-reciprocating territories.
In the case of Kevin George Vaz Vs. Cotton Textiles Exports Promotion Council5, the Hon’ble High Court of Bombay clarified the above discussed position of the Indian Legal System vis-àvis Foreign Awards from Reciprocating and Non- Reciprocating territories of India.
It is also pertinent to highlight that reciprocity is a bilateral arrangement and Reciprocating Territories are not an exception to this rule. All the reciprocating territories of India mutually agree to enforce court orders passed by the Indian Courts in their country as well. In the back drop of globalization and rapid integration of world economies, such mutuality appears to be the need of the hour. An optimist would like to perceive such mutuality and reciprocity as the stepping stone towards the ultimate goal of conceptualizing a ‘World Court’.
Reciprocating territories of India
In exercise of the power conferred by section 44-A of ‘the code’, the central government of India has notified 11 territories as Reciprocating Territories of India. The names of these territories are as follows;
- United Kingdom
- Republic of Singapore
- Federation of Malaya
- Trinidad and Tobago
- New Zealand, the Cook Islands (including Niue) and the Trust Territories of Western Samoa
- Hong Kong
- Papua and New Guinea
- United Arab Emirates\
Thus we see that a foreign judgment from a reciprocating territory has a special status in India. For enforcement of a foreign judgment from a reciprocating territory a law suit is not required to be instituted. However, it is also pertinent to mention that no foreign judgment shall be held conclusive if it attracts any of the clauses mentioned in section 13 of ‘the code’. Section 13 of the code reads as under;
13. When foreign judgment not conclusive. A foreign judgment shall be conclusive as to any matter thereby directly adjudicated upon between the same parties or between parties under whom they or any of them claim litigating under the same title except
- where it has not been pronounced by a Court of competent jurisdiction;
- where it has not been given on the merits of the case;
- where it appears on the face of the proceedings to be founded on an incorrect view of international law or a refusal to recognise the law of 1[India] in cases in which such law is applicable;
- where the proceedings in which the judgment was obtained are opposed to natural justice;
- where it has been obtained by fraud;
- where it sustains a claim founded on a breach of any law in force in 1[India].