VidhiSangh

Supreme Court of India · 22/04/2020

NATIONAL AGRICULTURAL COOPERATIVE MARKETING FEDERATION OF INDIA versus ALIMENTA S.A.

[2020] 7 S.C.R. 789 · 2020 INSC 345

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Summary

The foreign award imposing damages on NAFED was held unenforceable because government refusal of export permission triggered the contract’s express cancellation contingency. Section 32 governed the agreed contingency, rather than Section 56 frustration. Enforcing damages despite that prohibition offended fundamental Indian policy under the Foreign Awards Act, 1961. Separate objections concerning legal representation and appointment during interim stays did not supply the basis for refusal.

Issues

  1. Whether refusal of government export permission discharged the unfulfilled contract under its prohibition clause.
  2. Whether Section 32 or Section 56 governed the contingency.
  3. Whether enforcement of the foreign award conflicted with public policy.
  4. Whether the additional procedural and interest objections affected enforcement.

Provisions considered

Held

Result

NAFED’s appeal allowed; High Court judgment set aside and foreign award declared unenforceable. No costs.

Judgment PDF: Supreme Court of India, [2020] 7 S.C.R. 789.