Supreme Court Asks Law Commission to Study Execution of Arbitral Awards as 2002 Award Stays Unenforced

An internationally seated arbitration ended in an award dated 10.08.2002 for the appellant, denominated in Iraqi Dinars; in 2015 the Supreme Court restored its directions (paras 4.1-4.2). In execution, the Delhi High Court let the award-debtor pay in rupees at the 1982 agreement-date rate; on 17.12.2019 the Division Bench set that aside and certified a question on the conversion date, which the Supreme Court answered in the negative on 10.10.2023 (paras 4.3-4.5). When the award-debtor said the principal was paid in 2009, the High Court, by interim order of 16.02.2026, let the parties seek clarification from the Supreme Court; the award-holder appealed, and the award-debtor applied to modify the 2023 judgment (paras 3, 4.6, 19).

The Division Bench misread the scope of what the Supreme Court decided in 2023 (para 7). Hearing a question of general importance certified under Articles 134-A and 133(1)(a), the Court was confined to answering it, without examining factual matters beyond its ambit (paras 7, 9). Having held that no conversion date arose, it had no occasion to clarify questions about amounts deposited or withdrawn (para 8). It cannot be asked, in the guise of clarification, to supervise continuing execution proceedings; their questions belong to the executing court and its appellate court (para 9). Once the referred question was answered, the earlier appeal stood exhausted and cannot be enlarged by unconnected questions (para 10). In an epilogue, the Court noted that the parties still litigate over enforcement twenty-four years after the award, striking at the rationale of arbitration (para 11). An arbitral regime must also be judged by how soon the successful party realises the award (para 12). Section 36 enforces an award as a decree through the CPC execution machinery; asset disclosure, coordination of modes of execution, dilatory objections and execution delays merit focused scrutiny (para 13).