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CS Professional · Arbitration, Mediation and Conciliation · International Law of Arbitration

Bharat Realty seeks to enforce a foreign award in India. The respondent argues that the tribunal misapplied Indian contract law to the facts and so the award is contrary to the fundamental policy of Indian law. Applying Explanation 2 to Section 48(2), how should the Court test this?

The Court cannot re-examine the merits. Explanation 2 to Section 48(2) provides that the test of contravention with the fundamental policy of Indian law shall not entail a review on the merits of the dispute, so alleged misapplication of law or facts alone does not defeat enforcement.

  1. ABy re-examining the merits of the dispute to see whether the tribunal's view was correct
  2. BBy checking only whether the award is a few days late
  3. CThe test for contravention of fundamental policy of Indian law does not entail a review on the merits of the disputeCorrect
  4. DBy treating any error of law as automatically against public policy

Explanation

Explanation 2 states that the test whether there is contravention of the fundamental policy of Indian law shall not entail a review on the merits of the dispute. Hence an alleged misapplication of law or fact does not by itself justify refusal. The first option is wrong because it permits a merits review, which is expressly excluded.

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