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

Orient Steel obtained a foreign award, and Rao Metals has applied in the courts of the seat country to set it aside. Orient applies for enforcement in India. Which course is open to the Indian court under Section 48(3)?

The court may adjourn its decision if it considers that proper, and on Orient Steel's application may order Rao Metals to furnish suitable security. Section 48(3) gives this discretion when a setting aside or suspension application is pending before the competent authority at the seat.

  1. AIt must enforce at once because the setting aside application is irrelevant
  2. BIt may, if it considers it proper, adjourn the decision and, on Orient's application, order Rao Metals to give suitable securityCorrect
  3. CIt must permanently dismiss the enforcement application
  4. DIt may order Orient Steel to give security to Rao Metals before any hearing

Explanation

Section 48(3) applies when an application to set aside or suspend the award is pending before the competent authority. The court may adjourn the enforcement decision if proper and, on the application of the party claiming enforcement, order the other party to give suitable security. Security is therefore ordered against the resisting party, not the enforcing party.

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