Court dismisses objections on public policy and limitation grounds, directing EBIX Cash to comply with the €13.27 million award.
In a significant ruling, the Delhi High Court has allowed the enforcement of a foreign arbitral award against EBIX Cash Limited and its guarantor, despite several objections raised by the Indian company. The award, rendered by the International Court of Arbitration of the International Chamber of Commerce (ICC) on February 17, 2022, mandates EBIX Cash to pay Amadeus IT Group S.A. approximately €13.27 million.
The case, presided over by Justice Jasmeet Singh, involved a series of objections from EBIX Cash, challenging the enforcement on grounds of public policy, limitation, and the doctrine of election of remedies. However, the court found these objections untenable.
The key arguments from EBIX Cash centered on the claim that the transaction constituted a "factoring business" under the Factoring Regulation Act, 2011, which would require registration as a "Factor" with the Reserve Bank of India. The court dismissed this claim, stating that the transaction was a standard commercial arrangement involving advance payments for incentives, not falling under the purview of the Factoring Act.
On the limitation aspect, EBIX Cash argued that the enforcement petition was time-barred, claiming it was filed after the three-year limitation period from the award date. However, the court clarified that the limitation period commenced from the date the award was actually received by Amadeus, which was February 21, 2022, making the petition timely.
Furthermore, the court rejected the argument concerning the doctrine of election of remedies. EBIX Cash had contended that Amadeus, by participating in US bankruptcy proceedings and entering into a forbearance agreement with EBIX Inc., had elected its remedy and could not now pursue enforcement in India. The court ruled that the liabilities under the award were joint and several, allowing Amadeus to pursue enforcement against any or all liable parties.
Justice Singh noted that the grounds for refusing the enforcement of a foreign award under Section 48 of the Arbitration and Conciliation Act, 1996, are narrow, emphasizing that the objections raised did not meet the threshold for public policy violations as defined under Indian law.
The court ordered EBIX Cash to pay the outstanding amount along with interest within four weeks, affirming the enforceability of the ICC award as a decree of the court. Amadeus is required to submit a calculation of the outstanding amount within a week, with the matter scheduled for compliance review on July 17, 2026.
This ruling underscores the Indian judiciary's commitment to upholding international arbitration awards, aligning with global arbitration standards and reinforcing India’s reputation as an arbitration-friendly jurisdiction.
Bottom line:-
Enforcement of foreign arbitral awards under Part II, Chapter I of the Arbitration and Conciliation Act, 1996 is subject to limited and narrowly construed grounds under Section 48, including public policy objections. Transactions arising out of commercial agreements involving advance payments towards incentives do not amount to factoring transactions under the Factoring Regulation Act, 2011, and foreign companies are not required to register as "Factors" under the Act.
Statutory provision(s):
Arbitration and Conciliation Act, 1996 Sections 47, 48, 49; Limitation Act, 1963 Article 137; Factoring Regulation Act, 2011 Section 2(j)
Amadeus IT Group S.A. (Spain) v. EBIX Cash Limited, (Delhi) : Law Finder Doc id # 2933250
