Trace Your Case


Bharat Aluminium Co. v. Kaiser Aluminium Technical Services Inc., (2012) 9 SCC 552


  • Whether Part I of the Arbitration and Conciliation Act 1996 is applicable to arbitration held outside the territory of India?


  • The Jurisdictional Theory of Arbitration or the Territorial Theory in UNCITRAL explains broadly the role of the Courts at the seat of Arbitration having supervisory powers and control over the proceedings taking place within the boundaries of its territory.


  • Vide an agreement dated April 22, 1993, executed between the Appellant (BALCO) and the Respondent (Kaiser), the Respondent was to supply and install a computer-based system in the premises of the Petitioners business.
  • The Agreement contained an Arbitration Agreement which stated that any dispute that arose between the two parties would be subject to be settled in accordance with the English law and the venue of said arbitration proceedings would be London. However, the agreement stated that the governing law would be Indian Law.
  • A dispute arose and was referred to the Arbitral Tribunal in England, which passed two awards and the same were to be challenged in India under Section 34 of the Arbitration and Conciliation Act 1996. The District Court of Bilaspur and the High Court rejected the order passed by the Arbitral Tribunal in England. The Appellant thus appealed to the Supreme Court.


  • The Apex Court firstly held that there is a distinct difference between Part I and Part II of the Act, and the two must not be overlapped. The Court emphasized on the difference between a ‘seat’ and a ‘venue’ , and that the mere choice of conducting arbitration in another country signifies an acceptance to the law of that country, and thus, even if the agreement specifies Indian Law to be the governing law, Part I of the Act would not be rendered to be applicable and an Indian Court(s) cannot exercise supervisory jurisdiction for the same.
  • The Court further dismissed the judgement given in the Bhatia International case, and held that Indian Courts do not have the power to grant interim measures when the seat of Arbitration is located outside India. The Court concluded by stating that in international commercial arbitrations conducted in foreign locations, an application for interim relief would not be maintainable in India, by way or arbitration or by filing a suit.