Arbitration case insights: Delhi HC judgement regarding arbitral award arising out of a commercial transaction
July 2, 2021
This Update tracks the developments that took place following the petitions filed by KLA Const Technologies Pvt. Ltd. and Matrix Global Pvt. Ltd, wherein the High Court of Delhi held that a foreign State cannot claim sovereign immunity against enforcement of an arbitral award arising out of a commercial transaction. The Court reinforced that an arbitration agreement, when entered into for purely commercial purposes, is binding on all signatories, even if one of the parties is a sovereign State.
The decision was a remarkable attempt by the Court to ensure that Indian arbitration law aligns with international arbitration jurisprudence and that it is not plagued with the rigours of domestic procedural laws.