Compania Naviera ‘Sodnoc’ v.

Bharat
Refineries Ltd. AIR 2007 Mad 251
Elamathi J
17BLA1061
Parties to the suit

• Petitioner: Compania Naviera 'Sodnoc'

• Respondent 1: Bharat Refineries Ltd. 
• Respondent 2: Arbitrator
Facts
• On 24.8.1998, Mutual Task Maritime Ltd, SEA MANA to the 1st respondent herein to carry
a cargo of minimum 8000 m.t., bagged salt from Kandla, India to Tanga, Tanzania on
terms and conditions as set out in the Charter Party.
• The said company Mutual Task Maritime Company claimed demurrage or damages for
detention in the sum of US$ 43,483.49 together with interest to 1st respondent.
• 1st respondent denied that any more than US$ 1,169.88 of the sum claimed was due,
alleging that the balance of the claim for demurrage related to a period during which
the Master wrongfully refused to commence discharge.
• The 2nd respondent arbitrator and seat of arbitration in london dealt with the
dispute, and 2nd respondent by award dated 2.3.2000 directed 1st respondent to pay the
claimant namely the Mutual Task Maritime Company the sum of US$ 43,483.49 with
interest at the rate of 8% compounded with 3 monthly rests from 1.12.1998.
• Later on 3.12.2001, a deed was executed by Mutual Task Maritime Company in favour
of the petitioner assigning all rights arising out of the Charter Party dated
24.8.1998 including the claim of US$ 43,483.49.
Cont...
• So, on 29.6.2002, petitioner sent a letter to 1st respondent demanding the amount due
under the award, for which 1st respondent replied stating that they were not liable to
pay any amount to the petitioner.
• And another letter dated 8.7.2002 was sent by the petitioner claiming the amount, but
1st respondent again disowned their liability by their reply dated 31.7.2002.
• Hence, the petitioner filed the above petition under Sections 47 and 49 of the
Arbitration and Concilliation Act, 1996 for reliefs.
• In the counter filled by 1st respondent resisted the claim of the petitioner by
contending that petitioner is a stranger, the alleged assignment is not a valid one, no
leave was obtained from the court in England under Section 66 of the England
Arbitration Act and the petition is barred by limitation.
• the petitioner contended that the award is a foreign award within the meaning of the
Act, 1996 and as such it is straight away enforceable and executable before this Court
by the petitioner, who is an assignee of the award.
Cont...

• The 1st respondent while reiterating the objections raised in the counter contended
that the petitioner is a 3rd party to the Charter Party dated 24.8.1998 and they
cannot maintain the petition unless they prove the validity of the assignment deed in
a competent court in a manner known to law. He relied on the decision reported in
2004 (2) Arb L.R. 548 (SC) (Fargo Freight Ltd. v. The Commodities Exchange
Corporation) in this regard.
• The court looked into section 47, 48 and 49 of arbitration and concilliation act, 1996
which deals with enforcement of foreign awards, are relevant for the purpose of
deciding the above petition 
Arguments of the counsels and Courts views 
• The court first looked into M/S. Fuerst Day Lawson Ltd vs Jindal Exports Ltd AIR 2001 SC 2293. In
this case, the Supreme Court categorically held that for enforcement of foreign award there is no
need to take separate proceedings, one for deciding the enforceability of the award to make rule of
the court or decree and the other to take up execution thereafter. In one proceeding, the court
enforcing a foreign award can deal with the entire matter.
• The main objection of 1st respondent is that unless the assignment of the award dated 2.3.2000 is
favour of the petitioner is established in an independent proceeding, the same cannot be acted
upon and as such the petitioner is only a 3rd party and they cannot enforce this foreign award.
• So,the petitioner filed a copy of the deed of assignment dated 3.12.2001 in which in Clause 7 it is
specifically stated that the company, (i.e.) Mutual Task Maritime Ltd., Ellias S. Condos and solon E.
condos, who are the sole and exclusive legal and beneficial owners of all the shares of the company
by this agreement transfer to Compania Naviera 'SODNOC', S.A. Panama and or Elias Condos all their
rights which were arisen from C/P dated 24.8.1998, i.e., claim of USD 43,483.49 against Bharat Salt
Refineries, Ltd. the 1st respondent herein.
• And notice on assignment to petitioner was sent to the 1st respondent also.
Cont...
• Later, an objection was made by 1st respondent that as the award was passed on
2.3.2000, the petition to enforce the award should have been filed within 3 years and as
the same was filed only in 2005, the relief is barred by limitation.
• But the held rejected this objection stating that under arbitration and concilliation act,
1996, the foreign award is already stamped as a decree and parties can straight
away apply for enforcement, the party having a foreign award has got 12 years time like
that of a decree holder.
• So, the petitioner has satisfied the requirements as contemplated under Section 47 of the
Act and 1st respondent has not furnished any proof as enumerated under the provisions
of Section 48 and in such circumstances the award dated 2.3.2000 passed by 2nd
respondent is enforceable and shall be deemed to be a decree of this Court.
• Therefore the court held that the 1st respondent is liable to make payment of the amount
due to the pettioner within 4 weeks.