ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Globalisation and the Judicial Sovereignty of India

An award passed by an arbitral tribunal in Singapore has criticised the Supreme Court of India for its delay in handling cases and directed the Government of India to compensate an investor from Australia for such a hold-up. This hits at the root of the country's judicial sovereignty. Bureaucrats who draft bilateral investment treaties that enable such claims have a lot to answer for.

There is a growing view that the power of the nation state is being eroded by globalisation. But one never thought that it would go to the extent of an award being passed by an arbitral tribunal in Singapore criticising the ­Supreme Court of India for its delay in handling cases and directing the Government of India to compensate an investor from Australia for such a delay (White ­Industries Australia Limited and the Republic of India 2011). This award should alarm any right-thinking person and compel him or her to wonder at the way in which the babus sitting in New Delhi draft international treaties and also the manner in which the Government of I­ndia conducts international arbitrations.

The case arose in the following circumstances. In September 1989, an Australian company called White Industries entered into a contract with Coal India for the “supply of equipment to and development of a coal mine at Piparwar” in Uttar Pradesh. Over a period of time, certain disputes arose between the parties. As provided by their contract, the disputes were referred to arbitration. In May 2002, an arbitral tribunal in London, by its majority opinion, passed an award in favour of White Industries for a sum of Australian (A)$4.08 million. Coal India challenged the award in the Calcutta High Court and White Industries made an application to the Delhi High Court for the enforcement of the award. The proceedings in both the courts went on for some time. Meanwhile, the Supreme Court ­rejected White Industries’ application asking that the Calcutta High Court case be transferred to Delhi.

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