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National Agricultural Cooperative Marketing Federation of India v Alimenta SA 2020 SCC OnLine SC 381


  • “Whether the Indian Supreme Court’s extensive review of the merits of the foreign arbitral award in the NAFED case aligns with the pro-enforcement bias stipulated in Section 48 of the 1996 Act and the New York Convention’s principles of minimal judicial intervention?”
  • Whether a violation of India’s export policy can legitimately be regarded as a violation of public policy under Section 48 of the 1996 Act, and whether this broader interpretation may lead to increased difficulties in enforcing foreign arbitrary judgments in India?”


  • Section 7(1)(b)(ii) of the Foreign Awards (Recognition and Enforcement) Act, 1961 (now Section 48(2)(b) of the Arbitration and Conciliation Act, 1996), which allows for the refusal of enforcement of foreign arbitral awards on grounds of public policy, is one of the important legal provisions.


  • NAFED and Alimenta S.A. signed an agreement to supply Indian HPS groundnut.
  • The deal incorporated terms and conditions from the FOSFA 20 contract, which included a clause indicating that the agreement would be canceled if an executive order or law imposed an export embargo.
  • Due to export limitations imposed by the Indian government’s Export Control Order, NAFED could not perform the contract, prompting an arbitration procedure before FOSFA.
  • FOSFA awarded Alimenta damages, which the FOSFA Board of Appeal confirmed.
  • Alimenta attempted to have this international arbitral award enforced in India.


  • In the NAFED case, the Indian Supreme Court thoroughly analyzed the merits of a foreign arbitral judgment, including determining whether factors such as export limitations justified the failure to complete a contract.
  • The Court held that enforcing the foreign award could be contrary to Indian national policy, notably in export policy. It was decided that a violation of export policy might be regarded a breach of public policy, which could be used to refuse enforcement.
  • The NAFED decision raised concerns about the pro-enforcement bias specified in Section 48 of the 1996 Act, since it appeared to allow for extended scrutiny and potential denial of enforcement based on public policy grounds.
  • The Court’s reading of public policy, particularly in the context of export policy, diverged from previous decisions, such as Renusagar, which had a narrower view of what constituted a violation of public policy.
  • The judgment created uncertainty and called into question the precedential value of prior decisions, leading to confusion in Indian law regarding the implementation of international arbitral awards. This could have ramifications for India’s reputation as an international arbitration center.