Holding

Section 85(2)(a) saves the provisions of the Arbitration Act, 1940 for all arbitral proceedings, including award enforcement, that commenced before the 1996 Act, unless the parties expressly agree otherwise; the new Act governs proceedings commencing after its commencement and foreign awards after its commencement are enforceable only under the new Act.

Summary

The Supreme Court examined three appeals concerning the applicability of the Arbitration and Conciliation Act, 1996 (the new Act) versus the Arbitration Act, 1940 (the old Act) and the Foreign Awards Act, 1961. In Thyssen Stahlunion GmbH v. SAIL (CA 6036/98), arbitral proceedings began in 1995 under the old Act and the award was rendered after the new Act came into force; the Court held that the award must be enforced under the old Act. In Western Shipbreaking Corp. v. Clareheaven Ltd. (CA 4928/97), a foreign award made after the new Act’s commencement was held to be enforceable only under the new Act. In Rani Constructions Pvt. Ltd. v. HPSEB (CA 61/99), the parties had agreed that the new Act would apply even though the arbitration started before the new Act, and the Court allowed that agreement. The Court interpreted Section 85(2)(a) to mean that the old Act applies to all stages of arbitration, including enforcement, for proceedings commenced before the new Act, unless the parties expressly opt for the new Act. It also clarified that parties may agree to the new Act’s applicability before its commencement and that no vested right under the repealed Foreign Awards Act survives. The Court dismissed the first two appeals and allowed the third.

Issues considered

The scope of Section 85(2)(a) of the Arbitration and Conciliation Act, 1996 with respect to arbitral proceedings commenced before its commencement.
Whether the award made after the new Act’s commencement is governed by the old Act or the new Act for enforcement.
Whether parties can contractually agree to the applicability of the new Act before it comes into force.
The effect of the repeal of the Foreign Awards Act, 1961 on enforcement of foreign awards made after the new Act’s commencement.
The applicability of Section 6 of the General Clauses Act, 1897 to accrued rights under repealed statutes.

Legislation cited

Arbitration Act, 1940s. 14, s. 17, s. 2(e), s. 30, s. 48
Arbitration and Conciliation Act, 1996s. 10, s. 11(4)(b), s. 32, s. 34, s. 36, s. 42, s. 85, s. 9
Foreign Awards (Recognition and Enforcement) Act, 1961s. 47, s. 48, s. 7, s. 8
General Clauses Act, 1897s. 6
Indian Contract Act, 1872s. 28

Subjects

arbitrationrepeal and saving clauseSection 85enforcement of arbitral awardaccrued rightsforeign awardGeneral Clauses Actcontractual agreementUNCITRAL Model Lawarbitral proceedings

Judgment

THYSSEN STAHLUNION GMBH ETC. A
v.
STEEL AUTHORITY OF INDIA LTD.

OCTOBER 7, 1999

[D.P. WADHWA AND M.B. SHAH, JJ.] B

Arbitration :

Arbitration Act, 1940-Sections 2(e), 14, 17, 30, 48--Arbitration and
Conciliation Act, 1996-Sections 9, 10, 11(4)(b), 32, 34, 36, 42, 85-Arbitral
proceedings commenced before the 1996 Act came into force-Award
c
rendued after commencement of the 1996 Act-Enforcement of award-Ap-
plicability of provisions-Held, the provisions of Arbitration Act, 1940 shall
apply in relation to arbitral proceedings which have commenced before
coming into force of the Arbitration and Conciliation Act, 1996--Expression
'in relation to' occurring in Section 85(2)(a) of 1996 Act has to be given full D
effect to, which saves not only the proceedings pending at the time of
commencement of 1996 Act but also the provisions of the 1940 Act for
enforcement of the award under that Act-Both the Acts being vastly different
to each other, multiple and complex problems would arise if the award given
under 1940 Act is said to be enforced under the 1996 Act-The 1996 Act E
would be applicable in relation to arbitral pruceedings which commenced on
or after the 1996 Act came into force-Hence-Section 6 of the General
Clauses Act would be inapplicable-General Clauses Act, 1897-Section 6.

Accrued right-Existence of-Held, once the arbitral proceedings have
commenced under the 1940 Act, the right to be governed by that Act for F
enforcement of the awa!t! is certainly a right accrued-It is 11ot necessary that
for such right to accrue, some legal proceedings for enforcement must be
pending under the 1940 Act at the time when 1996 Act came into
force-Saving clause as enshrined in Section 85(2)(a) of the 1996Act has the
effect of saving the whole of the 1940 Act until the time of enforcement of the G
award and preserves the existing rights accrued under the 1940 Act.

Parties entering into an agreement for application of the 1996 Act even
before that Act came into force-Tenability of-Held, in cases where arbitral
proceedings commenced before coming into force of the 1996 Act and are
pending before the arbitrator, it is open to the parties to agree that 1996 Act H
461
462 SUPREME COURT REPORTS (1999) SUPP. 3 S.C.R.

A be applicable to such arbitral proceedings and they could so agree even before
the coming into force of the 1996 Act-Parties can always agree that
provisions that are in. force at the relevant time would apply and it is not
necessary.Jor the parties to know what law will be in force at the time of the
conduct of arbitration proceedings-That would not be in restraint of legal
B proceedings under Section 28 of the Contract Aa-However, the parties
cannot agree to the applicability of the old Act after the new Act has come
into force, when arbitral proceedings under the old Act have not commenced
though the arbitral agreement was under the old Act-Contract Act, 187'2:-
Exception I to Section 28.

C Foreign Awards (Recognition and Enforcement) Act, 1961-Foreign
award given after the commencement of the Arbitration and Conciliation Act,
1996-Enforcement of-Held, a foreign award given after the commencement
of the 1996 Act can be enforced only under the 1996 Act as there is no vested
right to have the foreign award enforced under the Foreign Awards Act-This
D is imspective of the fact that the arbitral proceedings. commenced in a foreign
jurisdiction-Applicability of the Foreign Awards Act is not saved by virtue of
the saving clause in Section 85(2)(a) of the 1996Act as the Foreign Awards
Act contains provisions only for the enforcement of the foreign award and not
for the arbitral proceedings-Moreover, there is not much difference in the
provisions of the Foreign Awards Act and the 1996 Act for the enforcement
E of the arbitration award-Since no right accmed, Section 6 of the General
Clauses Act would not apply.

Civil Appeal numbers 6036/98, 4928/97 and 61/99 raise three dif-
ferent questions relating to the construction and interpretation of Section
F 85 of the Arbitration and Conciliation Act, 1996 which contains repeal
and saving provision of the three Acts namely, t~ Arbitration (Protocol
and Convention) Act, 1937; the Arbitration Act, 1940; and the Foreign
Awards (Recognition and Enforcement) Act, 1961.

In CA No. 6036/98, the arbitration proceedings commenced on Sep-
G tember 14, 1995 under the Arbitration Act, 1940. Hearing before the sole
arbitrator took place from January 7, 1997 till January 28, 1997 and the ·
award was given on September 24, 1997. By this time on January 25, 1996,
the Arbitration and Conciliation Act, 1996 had come into force. In October
1997, the appellant filed a petition in the High Court under the Arbitra-
H tion Act, 1940 for making the award rule of Court. While these proceed-
THYSSEN STAHLUNION GMBH v. STEEL \\UTHORITY OF INDIA 463

ings were pending in the High Court, the appellant filed an application A
under Section 151 of the Code of Civil Procedure for stay of the proceed-
ings. Thereafter the appellant filed an application in the High Court for
execution of the award under the 1996 Act on the ground that the arbitra-
tion proceedings had been terminated with the making of the award and
therefore, the 1996 Act was applicable for enforcement of the award. The
respondent opposed the maintainability of the execution petition. A Single
B
Judge of the High Court held that proceedings would be governed by the
1940 Act. Feeling aggrieved, the appellant has preferred the presen~ ap-
peal.

In CA No. 4928/97, the arbitration proceedings were held in United C
Kingdom prior to the enforcement of the Arbitration and Conciliation
Act, 1996. The award was made on February 25, 1996 in London. With
regard to enforcement of the award, a Single Judge of the High Court
held that the Arbitration and Conciliation Act, 1996 would be applicable
and not the Foreign Awards (Recognition and F;nforcement) Act, 1961. D
Hence the present appeal.

In CA No. 61/99, the disputes having arisen, the same were referred
to the sole arbitrator on December 4, 1993. The arbitrator gave his award
on February 23, 1996 after the 1996 Act had come into force. Difference
of opinion having occurred in two judgments rendered by Single Judge E
of High Court as to the applicability of the Act, reference was made to
the Division Bench which held that the case was governed by Arbitration
Act, 1940. Hence the present appeal.

On behalf of the appellant in CA No. 6036/98, it was contended that F
after the termination of arbitral proceedings and makings of final award,
reference has to be made to the new Act for enforcement of the award as
when award was given, the old Act stood repealed; that the law governing
arbitration proceedings can be different than that governing the award;
that ·an award made pursuant to arbitration proceedings which com-
menced under the old Act, could be governed by the old Act only if any G
vested. right accrued to the party; that until award is made, M party has
an accrued right and thus an award made after coming into force of new
Act would be governed by new Act; that the claim of the respondents that
they had acquired vested right to challenge the award under the old Act
in view of Section 6 of foe General Clauses Act is also incorrect. H
464 SUPREME COURT REPORTS (1999] SUPP. 3 S.C.R.

A On behalf of the appellant in CA No. 4928/97, it was contended
that it would b~ ..t.~e Forejgn_Awards Act.that would apply-and not the
1996 Act; that since the proceedings had -
already commenced,
ff •
Section 21
of the 1996 Act stipulating as to wht)Ir arbitratid'n proceedings commence,
had no application; that the ~pplicability of all the provisions of the old
B Acts were saved where the,arbitral proceedings commenced before the cut
off date.

On 'benalf of the appellant in CA No. 61/99, it was contended that
the parties cannot agree to the applicability of the old Act after the new
Act had come into force when arbitration proceedings though under an
C agreement under the old Act, commence after the coming into force of
the new Act; that Section 28 of the Contract Act does not bar the agree-
ment between the parties if they wish that arbitration proceedings be
governed by any enactment relating to arbitration that may be in force
at the relevant time; that agreement could be entered into even before the
D new Act coines into force with regard to its applicability; that High Court
was wrong in holding that the agreelilent for the application of the new
Act has to be entered into only after the coming into force of the new Act.

On behalf of the respondent in CA No. 6036/98, it was contended that
there could not be two segments, namely, one uptill the award and second
E after the award; that when an award is made under the old Act, for its
enforcement, provisions of the old Act have to be looked into; that when
arbitration proceedings have started before coming into force of the new
Act, then, under the new Act, the award may not be sustainable; that it is
difficult to comprehend a situation where though the award is given under
p the old Act, its validity has to be decided under the new Act, provisions of
which are vastly different from those of the old Act; that if the legislature
intended that the new Act would apply to the award given under the old Act
made after the coming into force of the new Act, it would not use the
expression 'in relation to' in Section 85(2)(a) of the new Act but would use
the word 'to'; that it was not necessary that for the right to accrue, legal
G proceedings must be pending when the new Act comes into force.

On behalf of the respondent in CA No. 4928/97, it was contended that
Section 85(2)(a) of the 1996 Act cannot save the operation of the Foreign
Awards Act; that there was no accrued right in favour of the appellant to
H challenge the foreign award under the Foreign Awards Act, 1961 and hence,
THYSSEN STAHLUNION GMBH v. STEEL AUTHORITY OF INDIA 465

Section 6 of General Clauses Act by implication is inapplicable; that Section A
85(2)(a) of the new Act saves only those provisions of the old Act and the
Foreign Awards Act that would apply to arbitral proceedings and not the
' proceedings to enforce the arbitral award.

On behalf of the respondent in CA No. 61/99, it was contended that tbe
enforcement of the award under the new Act would not be compatible with B
the arbitration proceedings held under old Act resulting in the award; that
expression "arbitral proceedings" in Section 85(2)(a) of the new Act could
not be given restricted meaning of being confined merely to the conduct of
the proceedings by the arbitrator and excluding the enforcement of the
award from the purview of the old Act; that the agreement contemplated in c
the later part of Section 85(2)(a) could be entered into only after the
enforcement of the new Act and any agreement if entered into before this
date would be void and would be hit by Section 28 of the Contract Act.

Dismissing CA Nos. 6036/98 and 4928/97 and allowing CA No. 61/99,
this Court D
~·
HELD : 1. in the case .of Civil Appeal No. 6036 of 1998 where the
arbitral proceedings commenced before the Arbitration and Conciliation
Act, 1996 came into force, the award would be enforced under the provisions
of Arbitration Act, 1940. In CA No. 61/99, where arbitral proceedings com- E
menced before coming into force of the 1996 Act but parties agreed to the
applicability of the 1996 Act even before that Act came into force, the case
would be governed by the provisions of the 1996 Act. The foreign award
given in the case of Civil Appeal No. 4928 of 1997 after the commencement
of the Arbitration and Conciliation Act, 1996 would be governed by 1996 Act
as there is no vested right to have the foreign award enforced under the F
Foreign Awards Act. (517-C; D; E; F)

2.1. The provisions of the old Act (Arbitration Act, 1940) shall apply
in relation to arbitral proceedings which have commenced before coming
into force of the new Act (The Arbitration and Conciliation Act, 1996). The
. new Act would be applicable in relation to arbitral proceedings which
G
commenced on or after the new Act comes into force. (503-D; F]
. .
2.2. Section 85(2) (a) of the new Act is in two limbs : (1) Provisions of
the old Act shall apply in relation to arbitral proceedings which commenced
before the new Act came into force unless otherwise agreed by the parties H
466 SUPREME COURT REPORTS [1999] SUPP. 3S.C.R.

A and (2) new Act shall apply in relation to arbitral proceedings which
commenced on or after the new Act came into force. First limb can further
be bifurcated into two : (a) Provisions of old Act shall apply in relation to
arbitral proceedings which commenced before the new Act came into force
and (b) old Act will not apply in such cases where the parties agree that it
will not apply in relation to arbitral proceedings which commenced before
B the new Act came into force. The expression "in relation to" is of widest
import. This expression "in relation to" has to be given full effect to,
particularly when read in conjunction with the word "the provisions" of the
old Act. That would mean that the old Act will apply to whole gambit ·of
arbitration culminating in the enforcement of the .award. If ii was not so,
C only the word "to" could have suffixed and when the legislature has used
the expression "in reli!tion to", a proper meaning has to be given. This
expression does not admit of restrictive meaning. First limb of Section
85(2)(a) is not a limited saving clause. It saves not only the proceedings
-
pending at the time of commencement of the new Act but also the provisions
of the old Act for enforcement of the award under that Act. The second limb
D also takes into account the arbitration agreement entered into under the
old Act when the arbitral proceedings commenced after the coming into
force of the new Act. Any other construction on Section 85(2) (a) would only
lead to confusion and hardship. In this view of the matter, Section 6 of the
General Clauses Act would be inapplicable. [504-E-G; H; 505-A; B; C; DJ
E
Mis. Doypack Systems Pvt. Ltd. v. Union of India & Ors., [1988) 2 SCC
299; Mansukhlal Dhanraj Jain & Ors. v. Eknath Vithal Ogale, [1995) 2 SCC
665; Mis. Dhanrajamal Gobindram v. Mis. Shamji Kalidas and Co., [1961) 3
SCR 1020; Navin Chemicals Mfg. & Trading Co. Ltd. v. Collector of Customs,
[1993) 4 SCC 320; MMTC Ltd. v. Ster/ite Industries (I~dia) Ltd., [1996) 6
F SCC 716 and Hoosein Kasam Dada (India) Ltd. v. The State of Madhya
Pradesh and Ors., [1953) SCR 987, relied on.

2.3. Presently the courts tend to adopt purposive approach while
interpreting the statute which repeals the old law and for that purpose to
G take into account the objects and reasons which led to the enacting of the
new Act. Provisions of both the Acts, old and new, are very different. If the
construction of the new Act leads to inconvenient and unjust results, the
concept of purposive approach has to be shed. When arbitration proceed·
ings are held under the old Act, the parties and the arbitrator keep in view
the provisions of that Act for the enforcement of the award. Multiple and
H complex problems would arise if the award given under the old Act is said
TIIYSSEN SfAHLUNION GMBH v. STEEL AUTHORITY OF INDIA 467

to be enforced under the new Act. [506-C; D; 507-8-C] A·
Sohan Lal & Ors. v. Amin Chand and Sons & Ors., [1974] 1 SCR
453, relied on.

Sundaram Finance Ltd. v. NEPC India Ltd., [1992] 2 SCC 479,
referred to. B
Kuwait Minister of Public Works v. Sir Frederick Snow and Partners,
(1984) 1 All ER 733 HL and Pepper v. Hart, (1993) 1 All ER 42, referred
to.

3.1. Once the arbitral proceedings have commenced, it cannot be c
stated that right to be governed by the old Act for enforcement of the
award was an inchoate right. It was certainly a right accrued. It is not
imperative that for right to accrue to have the award enforced under the
old Act, some legal proceedings for its enforcement must be pending
under that Act at the time new Act came into force. Consequences for the D
parties against whom award is given after arbitral proceedings have been
". held under the old Act though given after the coming into force of the
new Act, would be quite grave if it is debarred from challenging the award
under the provisions of the old Act. [504-A·B]

3.2. Section 85(2)(a) of the new Act is the saving clause. It exempts the E
old Act from complete obliteration so far as pending arbitration proceed·
ings are concerned. That would include saving of whole of the old Act uptill
the time of the enforcement of the award. Section 85(2)(a) prevents the
accrued right under the old Act from being affected. Saving provision
preserves the existing right accrued under the old Act. The new Act is a F
remedial statute and, therefore, Section 85(2)(a) calls for strict construc-
tion, it being a repealing provision. But then where one interpretation would
produce an unjust or an inconvenient result and another would not have
those effects, there is then also a presumption in favour of the latter.
Enforcement of the award, therefore, has tO be examined on the touchstone G
of the proceedings held under the old Act. [508-G-H; 509-A-B]

Commissioner of Income Tax, U.P. v. Mis. Shah Sadiq and Sons,
[1987] 3 SCC 516; Bansidhar & Ors. v. State of Rajasthan & Ors., .[1989]
2 SCC 557; Lalji Raja & Sons v. Finn Hansraj Nathuram, [1971] 1 SCC
721; Hungerford Investment Trust Ltd. v. Haridas Mundhra and Ors., [1972] H
468 SUPREME COURT REPORTS (1999] SUPP. 3 S.C.R.

· A 3 SCR 690; D.C. Bhatia and Ors. v. Union of India and Anr., [1995) 1 SCC
104; M.S. Shivananda v. Kamataka State Road Transport Corporation &
Ors., (1980) 1 SCC 149; Gajraj Singh and Ors. v. State Transport Appellate
Tribunal and Ors., [1997) 1 SCC 650; Gujarat Electricity Board v. Shanti/al
R. Desai, AIR (1969) SC 239 = [1969) 1 SCR 580; G. Ekambarappa &
B Ors. v. Excess Profits Tax Officer, Bellary, [1967) 3 SCR 864, relied on.
Abbott v. The Minister for Lands, (1895) AC 425 PC; Director of Public
Works v. Ho Po Sang, (1961) 2 All ER 721 and Hamilton Gell v. White,
(1922) 2 KB 422, referred to.

C 4.1. In cases where arbitral proceedings have commenced before
coming into force of the new Act and are pending before the Arbitrator,
it is open to the parties to agree that new Act be applicable to such arbitral
proceedings and they. can so agree even before the coming into force of
-
the new Act. There is nothing in the language of Section 85(2)(a) which
bars the parties from so agreeing. When the agreement uses the expres-
D sions 'unless otherwise agreed' and 'law in force' it does give option to
the parties to agree that the new Act would apply to the pending arbitra-
tion proceedings. The expression "for the time being in force" not only
refers to the law in force at the time the arbitration agreement was entered
into, but also to any law that may be in force for the conduct of arbitration
E proceedings, which would also include the enforcement of the award as
well. There ·is, however ii bar that they cannot agree to the applicability
of the old Act after the new Act has come into force when arbitral proceed-
ings have not commenced though the arbitral agreement was under the
old Act. [503-F-G; 512-G, 513-E-B; 512-G-H]

F Sir Dinshaw Manekji Patit v. G.B. Badkas & Ors., AIR (1969) Bombay
151; Devkumarsingji Kasturchandji v. State of Madhya Pradesh and Ors.,
AIR (1967) ·M.P. 268 and Reshma Constructions v. State of Goa, (1999) 1
MIJ 462, approved.

4.2. Section 28 of the. Contract Act contains provisions regarding
G agreements in the restraint of legal proceedings. Exception I to Section 28
of the Contract Act does not render illegal a contract by which the parties
agree that any future dispute shall be referred to arbitration. That being so,
parties can also agree that the provisions of the arbitration law existing at
that time would apply to arbitral proceedings. It is not necessary for the
H parties to know what law will be in force at the time of the conduct of
THYSSEN STAHLUNJON GMBH v. STEEL AUTHORITY OF INDIA 469

arbitration proceedings. They can always agree that provisions that are in A
force at the relevant time would apply. In this view of the matter, if the
parties have agreed that at the relevanMime provisions of law as existing at
that time would apply, there cannot be any objection to that.
[514·H; 515-A; B; C]

5.1. A foreign award given after the commencement of the new Act B
can be enforced only under the new Act. There is no vested right to have
the foreign award enforced under the Foreign Awards (Recognition and
Enforcement) Act, 1961. After the repeal of the Foreign Awards Act, a
Foreign award can now be enforced under the new Act on the basis of the
provisions contained in Part II of the new Act depending on whether it
c
- is New York Convention award or Geneva Convention award. It is ir·
respective of the fact when the arbitral proceedings commenced in a
foreign jurisdiction. Since no right has accrued, Section 6 of the General
Clauses Act would not apply. Moreover, there is not much difference for
.the enforcement of the foreign award in the provisions of the foreign
Awards Act and new Act. Definition of foreign award is same in both the D
enactments. If provisions of the Foreign Awards Act and the new Act
relating to the enforcement of the foreign award are juxtaposed there
would appear to be hardly any difference. [515-C; D; E; 516-D]

5.2. Foreign Awards Act is concerned only with recognition ·and enfor·
cement of the foreign awards and does not contain provisions for the
E
conduct ofarbitral proceedings which would, of necessity, have taken place
in a foreign country. Arbitral proceedings and enforcement of the award are
two separate stages in the whole process of arbitration. When the Foreign
Awards Act does not contain any pr11visions for arbitral proceedings, then
it is not possible thatthe applicability of the Foreign Awards Act is saved by F
virtue of Section 85(2) (a) of the 1996 Act. [516-E-F; 515-H; 516-A]

Shetty's Construction Co. P. Ltd. v. Konkan Railway Constrnction,
[1998) 5 sec 599, referred to.

_, Sumitomo Heavy Industries Ltd. v. ONGC Ltd. and Ors., [1998) 1 G
SCC 305 and Oil and Natural Gas Commission v. Western Company of
North America, [1987] 1 SCR 1024, cited.

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 6036 of
1998 Etc. H
470 SUPREME COURT REPORTS [1999] SUPP. 3S.C.R.

A From the Judgment and Order dated 21.9.98 of the Delhi High Court
in E.P. No. 47 of 1998.

R.F. Nariman, R.P. Bhatt, S.G. Desai, Dipankar P. Gupta, AK.
Ganguli, R.N. Karanjawala, Gourab Banerjee, Arvind Kumar, Ms. Seema
Sapra, Ms. Suranya, Mrs. Manik Karanjawala, B.V. Desai, Siddharth
B Chowdhury, R. Rahim, Kailash Vasdev, Jaideep Gupta, Buddy A
Ranganadhan, Ms. S. Madan, Krishnan Venugopal, R. Sasiprabhu, Manish
Garg, Uday N. Tiwary, K.K. Lahiri, Ejaz Maqbool, B.K. Mishra and Subu
Ranjan for the appearing parties.

C The Jtidgment of the Court was delivered by

D.P. WADHWA, J. The Facts: -
These three appeals raise three different questions relating to the
construction and interpretation of Section 85 of th.e Arbitration and
D Conciliation Act, 1996 (the 'new Act' for short) which contains repeal and
saving provision of the three Acts, namely, the Arbitration (Protocol and
Convention) Act, 1937, the Arbitration Act, 1940 (the 'old Act' for short)
the Foreign Awards (Recognition and Enforcement) Act, 1961 (the
'Foreign Awards Act' for short).
E
This Section 85 of the new Act we reproduce at the outset :

"85. Repeal and saving - (1) The Arbitration (Protocol and Con-
vention) Act, 1937 (6 of 1937), the Arbitration Act, 1940 (10 of
1940) and the Foreign Awards (Recognition and Enforcement)
F Act 1961 (45 of 1961) are hereby repealed.

(2) Notwithstanding such repeal, -

(a) the provisions of the said enactments shall apply in relation
to arbitral proceedings which commenced before this Act
G
came into force unless otherwise agreed by the parties but
this Act shall apply in relation to arbitral proceedings which
commenced on or after this Act comes into force;

(b) all rules made and notifications published, under the said
H enactments shall, to the extent to which they are not repug-
THYSSEN SfAHLUNIONGMBHv. SfEELAUTHOR!TYOFINDIA [D.P. WADHWA,J.) 471

nant to this Act, be deemed respectively to have been made A ·
or issued under this Act."

In the case of Thyssen Stahlunion GMBH (CA No. 6036 of 1998) the
contract for sale and purchase of prime cold' rolled mild steel sheets in
coils contains arbitration agreement. Relevant clauses are as under :
B
"CLAUSE 12: LEGAL INTERPRETATION

12.1 This contract shall be governed and construed in accordance
with the laws of India for the time being in force.

12.2 To interpret all commercial terms and abbreviations used
c
herein which have not been otherwise defined, the rules· of
"INCOTERMS 1990" shall be applied.

CLAUSE 13 : SETTLEMENT OF DISPUTES
D
All disputes of differences whatsoever between the parties hereto
arising out of or relating to the construction, meaning or operation
or effect of this contract or the breach thereof shall unless amicably
settled between the parties hereto; be settled by arbitration in
accordance with the Rules of Conciliation and Arbitration of the
E
International Chamber of Commerce (ICC), Paris, France by a
sole Arbitrator appointed by the Chairman of the Arbitral Tribunal
of the Court of Arbitration of ICC and the Award made in
pursuance thereof shall be binding on both. the parties. The venue
for the arbitration proceedings shall be New Delhi, India.
F
Disputes and differences having arisen, the arbitration proceedings
commenced on September 14, 1995 under the old Act. On this date request
for arbitration was made to the ICC under the arbitration clause in the
contract. Mr. Cecil Abraham of the Malaysian Bar was appointed sole
arbitrator on November 15, 1995. Terms of reference in the arbitration G
were finalised on May 13, 1996. Hearing before the sole arbitrator took
place from January 7, 1997 till January 28, 1997. Award was given on
September 24, 1997. By this time on January 25, 1996 the new Act had
~, come into force. On October 13, 1997 Thyssen filed a petition in the Delhi
High Court under Sections 14 and 17 of the old Act for making the award H
472 SUPREME COURT REPORTS [1999] SUPP. 3 S.C.R.

A rule of court (Arbitration Suit No. 352-N97). While these proceedings
were pending in the High Court, Thyssen, on February 12, 1998;filed an
application under Section 151 of the Code of Civil Procedure for stay of
the proceedings. On the following day Thyssen filed an application in the
High Court for execution of the award under the new Act (Execution
B Petition No. 47/98). The ground taken was that the arbitration proceedings
had been terminated with the making of the award on September 24, 1997
and, therefore, the new Act was applicable for enforcement of the award.
The respondent, Steel Authority of India Ltd. (SAIL) opposed the
maintainability of the execution petition. SAIL also filed objections to the
award on various grounds under the oldAct. The question which arose for
c consideration is :

Whether the award would be governed by the new Act for its
enforcement or whether provisions of the old Act would apply?

D A learned single Judge of the Delhi High Court by judgment dated
September 21, 1998 held that proceedings would be governed by the old
Act. Thyssen Stahlunion GMBH feeling aggrieved filed this appeal (CA
6036/98).

In the case of Western Shipbreaking Corporation (CA No. 4928 of
E 1997) under Memorandum of Agreement dated November 4, 1994 M/s.
Clareheaven Ltd. agreed to sell to Western Shipbreaking Corporation a
ship "M.V. Kaldera". Clause (19) of the Memorandum of Agreement
contained arbitration clause which is as under :

"If any dispute should arise in connection with the interpretation
F
in fulfilment of this contract, same shall be decided by arbitration
in the city of London, U .K. with English law to apply and shall be .
referred to a single arbitrator to be appointed by the parties hereto.
If the parties cannot agree on the appointment of the single
arbitrator, the dispute shall be settled by three arbitrators, each
G party appointing one arbitrator the third .being appointed by
London Maritime Arbitration (sic) Association in London.

If one party fails to appoint an arbitrator either or by way of
substitution for two weeks after the other party having appointed
H his arbitrator, has sent the party making default notice by mail,
THYSSEN STAHLUNION GMBH_v: STEEL AUTHORITY OF INDIA (D.P. WADHWA, J.) 473

cable or telex to make the appointment, London Maritime Arbitra- A
tion (sic) Association shall after application from the party having
appointed his arbitrator also appoint on behalf of the party making
default.

The Award ren~ered by the arbitrators shall be final binding upon
the parties and may if necessary be enforced by any court or any B
other competent authority in the same manner as a document in
the court of justice~"

Arbitration proceedings in.this case were held in United Kingdom
prior to the enforcement of the new Act. The award was made on February c
25, 1996 in London. The question which arises for consideration is :

Whether the award is governed by the provisions of the new Act
for its enforcement or by the Foreign Awards Act?
I
A learned single Judge of.the Gujarat High Court by impugned D
Judgment dated April 21, 1997 held that the new Act would be applicable.
Western Shipbreaking Corporation is aggrieved and filed appeal against
that judgment (CA 4928/97).
I
I

In the case of M/s. Rani Constructions Pvt. Ltd. (CA No. 61of1999)
E
> ·. under the cont~act which was for the construction of certain works of the
Himachal Pradesh State Electricity Board, there was an arbitration
agreement contained in clause 25 which, in relevant part, is as under :

"Subject to the provisions of the contract to the contrary as
.aforesaid, the provisions of the Indian Arbitration Act, 1940 or any F
statutory modification or re-enactment thereof and the rules made
thereunder and for the time being in force shall apply to all
arbitration proceedings under this clause."
..
Disputes having arisen, these were referred to the sole arbitrator on
December 4, 1993. The arbitrator gave his award on February 23, 1996 after G
the new Act had come into force. On account of difference of opinion, in
two judgments of the Himachal Pradesh High Court, both rendered by
single Judges, as to whether it is old or new Act will apply, a learned •
single Judge of the High Court referred the following question to a
larger Bench : H
,,..
474 SUPREME COURT REPORTS [1999] SUPP. 3 S.C.R.

A "Whether the agreement referred to in Section 85(2)(a) of the Act
of 19% for the purpose of applicability of the said Act to the
pending arbitral proceedings which had already commenced under
the Act of 1940 is one necessarily to be entered into after the
commencement of the Act of 1996 or any clause to that effect in
an agreement already entered into between the parties before the
B enforcement.of the Act of 1996 would be sufficient for that pur-
pose."

Reference question does not appear to have been happily worded.
What it means is that when clause (a) of Section 85(2) of the new Act uses
C the expression "unless otherwise agreed by the parties" can the parties
agree for the applicability of the new Act before the new Act comes into
force or they have necessarily to agree only after the new Act comes into
force.

The Division Bench of the High Court by the impugned judgment
D dated July 16, 1998 held that clause 25 of the agreement "does not admit
'
of interpretation that this case is governed by Act of 1996".

Arguments have been addressed in considerable detail for and
against the application of the new Act or the old Act in the cases of
Thyssen and Rani Construction and the Foreign Awards Act in the case
E of Western Shipbreaking Corporation. We would, however, refer to these
arguments in brief insofar we consider these to be relevant to decide the
issues before us.

The Submissions:

F Mr. F.S. Nariman, who appeared for Thyssen, made the following
sub!11issions :

1. Termination of arbitral proceedings by the final arbitration
award and the enforcement of the award are two separate
proceedings. Under Section 32 1 of the new Act arbitral
G proceedings shall terminate by the final award or by an order
of the arbitral tribunal under sub-section (2) as provided
therein. Thus after the arbitral proceedings are terminated
and final award made, reference has to be made to the new
. 1. 32.Termination of Proceedings . • (1) The arbitral proceedings shall be terminated by
H the final arbitral award or by an order of the arbitral tribunal under sub-section (2).
THYSSEN STAHLUNION GMBH v. STEEL AUTHORITY OF INDIA [D.P. WADHWA, J. J 475

Act for enforcement of the award as when award was given A
old Act stood repealed.

2. In view of the savings provision under clause (a) of sub-sec-
tion (2) of Section 85 of the new Act it is not necessary to
refer to Section 6 of the General Clauses Act, 18972.
B
3. New Act is based on UNCITRAL Model Law. It is a progres-
sive Act. Objects which led to passing of the new Act should
be kept in view. For this, reference may be made to the
Preamble3, of the new Act as well. In the Statement of Objects

2. The arbitral tribunal shall issue an order for the termination of the arbitral proceedings
c
where:
(a) the claimant ~thdraws his claim, unless the respondent objects to the order and
the arbitral tribunal recognises a legitimate interest on his part in obtaining a final
settlement of the dispute,
(b) the parties agree on the termination of the proceedings, or
D
( c) the arbitral tribunal finds that the continuation of the proceedings has for any
other reason become unnecessary or impossible.
6. Effect of repeal. - Where this Act, or any Central Act or Regulation made after the
commencement of this Act, repeals any enactmerit hitherto made or hereafter to be
made, then, unless a different i~tention appears, the repeal shall not :-
(a) revive anything not in force or existing at the time at which the repeal takes effect; E
or
(b) affect the previous operation of any enactment so repealed or anything duly done
or suffered thereunder; or
(c) affect any right, privilege, obligation or liability acquired, accrued or incurred under
any enactment so repealed; or
(d) affect any penalty, forfeiture or punishment incurred in respect of any offence F
committed against any enactment so repealed; or
( e) affect any investigation, legal proceeding or remedy in respect of any such right,
privilege, obligation liability, penalty, forfeiture or punishment as aforesaid;
and any such investigation, legal proceeding or remedy may be instituted, continued or
enforced, and any such penalty, forfeiture or punishment may be imposed as if the
repealing Act or Regulation had not been passed.'
3 WHEREAS the United Nations Commission on International Trade Law (UN-
G
CITRAL) has adopted the UNCITRAL Model ·Law on International Commercial
Arbitration in 1985;
AND WHEREAS the General Assembly of the United Nations has recom-
mended that all countries give due consideration to the said Model Law, in view of the
desirability of uniformity of the law .of arbitral procedures and the specific needs of
international commercial arbitration practice; H
476 SUPREME COURT REPORTS f1999J SUPP. 3 S.C.R;

A and Reasons4, the objectives behind introduction of the New

AND WHEREAS the UNCITRAL has adopted .the UNCITRAL Conciliation
Rules in 1980;
AND WHEREAS the General Assembly of the United Nations has recom-
mended the use of the said Rules in cases where a dispute arises in the context of
B international commercial relations and the parties seek an amicable settlement of that
dispute by recourse to conciliation;
AND WHEREAS the said Model Law and Rules make significant contribution
to the establishment of a unified legal framework for the fair and efficient settlement
of disputes arising in international commercial relations;
AND WHEREAS it is expedient to make Jaw respecting arbitration and con-
c ciliation, taking foto account the aforesaid Model Law and Rules;
Be it enacted by Parliament in the forty seventh year of the Republic as follows:-"
4. STATEMENT OF OBJECTS AND REASONS
''The law on arbitration in India is at present substantially contained in three enact-
ments, namely, the Arbitration Act, 1940, the Arbiiration (Protocol and Convention)
Act, 1937 and the Foreign Awards (Recognition and Enforcement) Act, 1961. It is
D widely felt that the 1940 Act, which contains the general law of arbitration, has become
outdated. The Law Commission of India, several representative bodies of trade and
industry and experts in the field of arbitration have proposed amendments to this Act
to make it more responsive to contemporary requirements. It is also recognised that
our economic reforms may not become fully effective if the law dealing with settlement
of both domestic and international commercial disputes remains out of tune with such
reforms. Like arbitration, conciliation is also getting increasing worldwide recognition
E as an instrument for Settlement of disputes. There is, however, no general law on the
subject in India.
2. The United Nations Commission on International Trade Law (UNCITRAL)
adopted in 1985 the Model Law on International Commercial Arbitration. The General
Assembly of the United Nations has recommended that all countries give due con-
sideration to the said Model Law, in view of the desirability of uniformity of the law
F of arbitral procedures and the specific needs of international commercial arbitration
practice. The UNCITRAL also adopted in 1980 a set of Condliation Rules. The
General Assembly of the United Nations has recommended the use of these Rules in
cases where the disputes arise in the context of int~mational commercial relations and
the parties seek amicable settlement of their disputes by recourse to conciliation. An
important feature of the said UNCITRAL Model Law and Rules is that they have
harmonised concepts on arbitration and conciliation of different Jegal systems of the
world and thus contain provisions which are designed for universal application.
G
3. Though the said UNCITRAL Model Law and Rules are intended to deal with
international commercial arbitration and conciliation, they could with appropriate
modifications, serve as a model for legislation on domestic arbitration and conciliation.
The present Bill seeks to consolidate and amend the law relating to domestic arbitra-
tion, international commercial arbitration, enforcement of foreign arbi.tral awards and
to define the law relating to conciliation, taking into account the said UNCITRAL
H Model Law and Rules.
THYSSEN STAHLUNION GMBHv. STEEL AUTHORITY OF INDIA [D.P. WADHWA, J.] 477

Arbitration law have been explained. A

It is clearly intended that the enforcement of the award given after the new
Act came into force would be governed by the new Act. Interpretation of
· the provisions of Section 85 has to be purposeful which advances the object ·
of the new Act. In Sundaram Finance Ltd. v. NEPC India Ltd., [1999] 2
sec 479 the question that arose for consideration was whether under B
Section 9 of the new Act court has jurisdiction to pass interim orders even
before arbitral proceedings· commence and before an arbitrator is ap-
pointed. Under this Section court is empowered to pass interim orders
before or during arbitral proceedings or at any time after the making of
the arbitral award but before its enforcement. During the course of discus- c
sion this Court referred to the statement of objects and reasons which led
to the promulgation of the new Act and said :

"The 1996 Act (new Act) is very different from the Arbitration
Act, 1940 (old Act). The provisions of this Act have, therefore, to D
be interpreted and construed independently and in fact reference
to the· 1940 Act may actually lead to misconstruction. In other
words, the provisions of the 1996 Act (new Act) have to be
. 4. The main objectives of the Bill are as under :
(i) to comprehensively cover international and commercial arbitration and conciliation E
as also domestic arbitration and conciliation;
(ii) to make provision for an arbitral procedure which is fair, efficient and capable of
meeting the needs of the specific arbitration;
(iii) to provide that the arbitral tribunal gives reasons for its arbitral award;
(iv) to ensure that the arbitral tribunal remains within the limits of its jurisdiction;
(v) to minimise the supervisory role of courts in the arbitral process; F
(vi) to permit an arbitral tribunal to use mediation, conciliation or other procedures
during the arbitral proceedings to encourage settlement of disputes;
(vii) to provide that eveiy final arbitral award is enforced in the same manner as if it
were a decree of the court;
(viii) to provide that a settlement agreement reached by the parties as a result of
conciliation proceedings will have the same status and effect as an arbitral award on G
·agreed terms on the substance of the dispute rendered by an arbitral tribunal; and
(ix) to provide that, for purposes of enforcement of foreign awards, eveiy arbitral
award made in a country to which one of the two intCrnational Conventions relating
to foreign arbitral awards to which India is a party applies, will be treated as a foreign
award.
5. The Bill seeks to achieve the above objects." H
478 SUPREME COURT REPORTS (1999] SUPP. 3 S.C.R.

A interpreted being uninfluenced by the principles underlying the
1940 Act (old Act). In order to get help in construing these
0

provisions, it is more relevant to refer to the U NCITRAL Model
Law rather than the 1940 Act."

4. Law governing arbitration proceedings can be different than that·
B · governing the award. In this connection reference may be made to a
decision of this Court in Sumitomo Heavy Industries Ltd., v. ONGC Ltd.
and Others,[1998] 1 SCC 305.

In Sumitomo Heavy Industries Ltd. 's case (supra) under the arbitra-
C tion agreement between the parties proceedings were to be held at London
in accordance with the provisions of International Chamber of Commerce
and the rules made thereunder as amended from time to time. Award was
made on June 27, 1995. ONGC Ltd. filed a petition in the High Court at
Bombay praying that the respondent be directed under Section 14 of the
old Act to file the award in that court. It was contended by ONGC that
D the award was invalid, un-enforceable and liable to be set aside under the
provisions of the Arbitration Act, 1940. This petition of the ONGC was
allowed by the High Court. It was noticed that during the course of
preliminary hearing in the Queens Bench Division, Commercial Court, in
London, Potter, J. had observed that one of the aspects of the case for
E consideration was :
"(4) The curial law, i.e., the· law governing the arbitration
proceedings themselves, the manner in which the reference is to
be conducted. It governs the procedural powers and duties of the
arbitrators, questions of evidence and the determination of the
F proper law of the contract."

Decision of the Bombay High Court was challenged in this Court. This
Court said that the central issue in the appeal was as to what was the area
of operation of the curial law and went on to observe as under :
G "The conclusion that we reach is that the curial law operates during
the continuance of the proceedings before the arbitrator to govern
the procedure and conduct thereof. The courts administering the
curial law have the authority to entertain applications by parties ·
to arbitrations being conducted within their jurisdiction for the
H purpose of ensuring that the procedure that is adopted in the
J
THYSSEN SfAHLUNION GMBH v. STEEL AUTHORITY OF INDIA(D.P. WADHWA, J.) 479

proceedings before the arbi~rator conforms to the requirements of A
the curial law and for reliefs incidental thereto. Such authority of
the courts administering the curial law ceases when the proceed-
ings before the arbitrator are concluded.

The proceedings before the arbitrator commence when he
enters upon the reference and conclude with the making ofthe B
award. As the work by Mustill and Boyd (in Law and Practice of
Commercial Arbitration in England, 2nd Edn.) aforementioned
puts it, with the making of a valid award the arbitrator's authority,
powers and duties in the reference come to an end and he is
''functus officio" (p. 404). The arbitrator is not obliged by law to C
file his award in court but he may be asked by the party seeking
to enforce the award to do so. The need to file an award in court
arises only if it is required to be enforced, and the need to
challenge it arises if it is being enforced. The enforcement process
is subsequent to and independent of the proceedings b~fore the
arbitrator. It is not governed by the curial or procedural law that D
governed the procedure that the arbitrator followed in the conduct
of the arbitration."

5. Section 85 of the new Act provides for a limited repeal. This
Section be contrasted with Section 48 of the old Act, which is as under : E
"48. Saving for pending references. - The provisions of this Act shall
not apply to any reference pending at th~ commencement to this
Act, to which the law in force immediately before the commence-
ment of this Act shall notwithstanding any repeal effected by this
Act continue to apply." F

This departure from the language used in Section 48 of the old Act is
deliberate and has to be given effect to while considering the scope of
Section 85 of the new Act.

6. Assuming that Section 6 of the General Clauses Act applies; the G
question whether a party gets a right at the time when the arbitration
proceedings commenced under the old Act and that the award given after
coming into force of new Act would yet be governed under the old Act,
can be answered only if any vested right accrued to the party. Vested rights
accrued when proceedings for enforcement of the award are taken and not H
i
480 SUPREMECOURTREPORTS (1999JSJPP.3S.C.R.

A before that. Right to take advantage of an enactment is not a \vested right.
One cannot have mere abstract right but only accrued right. Until award
is made no party has an accrued right. Till the award is· made nobody
knows his rights. In this connection reference may be madb to a decision
of the privy Council in Abbott v. The Minister for Lands, (1895) AC 425 PC,
B which was followed by this Court in Hungerford Investment Tmst Limited
v. Haridas Mundhra and Others, (1972] 3 SCR 690. Reference may also be
made to another decision of this Court in D.C. Bhatia and Others v. Union
of India and Another, (1995] 1 SCC 104.

lnAbbott v. The Minister for Lands, (1895) AC 425 PC the Court said
C that "the mere right, existing at the date of a repealing statute, to take
advantage of provisions of the statute repealed is not a 'right accrued'
within the meaning of the usual saving clause." The appellant had con-
tended that under the repealed enactment he had a right to make the
additional conditional purchase, and this was a "accrued right" at the time
D the Crown Lands Act of 1884 was passed and that notwithstanding the
repeal it remained unaffected by such repeal. The 1884 Act had repealed
earlier Crown Lands Act of 1861. The Board observed :

"It has been very common in the case of repealing statute to save
all rights accrued. If it were held that the effect of this was to leave
E it open to any one who could have taken advantage of any of the
repealed enactments still to take advantage of them, the result
would be very far-reaching .
•
It may be, as'Windeyer J. observes, that the power to take ad-
F vantage of an enactment may without impropriety be termed· a
"right". But the question is whether it is a "right accrued" within
the meaning of the enactment which has to be construed.

Their Lordships think not, and they are confirmed in this opinion
by the fact that the words relied on are found in conjunction with
G the words "obligations incurred or imposed". They think that the
mere right (assuming it to be properly so called) existing in the
members of the community or any class of them to take advantage
of an enactment, without any act done by an individual towards
availing himself of that right, cannot properly be deemed a "right
H accrued" within the meaning of the enactment.
THYSSEN STAHLUNION'GMBHv. STEELAlITHORITY OF INDIA (D.P. WADHWA, J.j 481

Even· if the appellant could establish that the language of sec. A
2(b) was sufficient to reserve to him the right for which he con-
tends, he would have to overcome further difficulties. That enact-
ment only renders "rights accrued" unaffected by the repeal
"subject to any express provisions of this Act in relation thereto".

This Court in Hungerford Investment Trust Limited v. Haridas
B
Mundhra and Others, [1972] 3 SCR 690 followed decision of Privy Council
in Abbott v. The Minister for Lands, (1895) AC 425 PC holding that the
mere right to take advantage of provisions of an Act is not an accrued right.

In D.C. Bhatia and Others v. Union of India and Another, [1995] 1 c
SCC 104 the question which arose for consideration before this Court
related to the interpretation and constitutional validity of Section 3(c) of
the Delhi Rent Control Act. Delhi Rent Control Act was amended with
effect from December 1, 1988 when Section 3(c) was introduced which
provided that the provisions of that Act will not apply to any property at D
a monthly rent exceeding Rs. 3,500. This Court while upholding the con-
stitutional validity of the provisions as contained in Section 3(c) of Delhi
Rent Control Act observed that "we are unable to uphold the contention
that the tenants had acquired a vested right in the properties occupied by
them under the statute. We are of the view that the provisions of Section
3(c) will also apply to the premises which had already been let out at the E
monthly rent in excess of Rs. 3,500 when the amendment made in 1988
came into force". One of the contentions raised by the tenants was that they
had acquired vested rights which could not be disturbed unless the amend-
ing Act contained specific provisions to that effect. They said that under
the existing law tenants had acquired valuable property rights and they F
could neither be evicted nor the rent could be enhanced and that even a
suit could not be brought against a tenant on the expiry of the lease. This
Court repealed the contention and said :

"52. We are unable to uphold this contention for a number of
reasons. Prior to the enactment of the Rent Control Act by the G
various State Legislatures, the legal relationship between the
landlord and tenant was governed by the provisions of the Transfer
of Property Act. Delhi Rent Control Act provided protection to
the tenants from drastic enhancement of rent by the landlord as
well as eviction, except on certain specific grounds. The legislature H
482 SUPREME COUkT REPORTS [1999) SUPP. 3 S.C.R.

A by the Amendment Act No. 57 of 1988 has partially repealed the
Delhi Rent Control Act. This is a case of express repeal. By
Amending Act the legislature has withdrawn the protection hither-
to enjoyed by the tenants who were paying Rs. 3,500 or above as
monthly rent. If the tenants were. sought to be evicted prior to the
amendment of the Act, they could have taken advantage of the
B provisions of the Act to resist such eviction by the landlord. But
this was nothing more than a right to take advantage of the
enactment. The tenant enjoyed statutory protection as long as the
statute remained in force and was applicable to him. If the statute
ceases to be operative, the tenant cannot claim to continue to have
c the old statutory protection. It was observed by Tindal, C.J ., in the
case of Kay v. Goodwin, (1830) 6 Bing 576 : 130 ER 1403 : (ER
p.1405)

"The effect of repealing a statute is to obliterate it as com-
pletely from records of the parliament as if it had never been
D passed; and, it must be considered as a law that never existed,
except for the purpose of those actions which were com-
menced, prosecuted, and concluded whilst it was an existing
law."

53. The provisions of a repealed statute cannot be relied upon
E
after it has been repealed. But, what has been acquired under the
Repealed Act cannot be disturbed. But, if any new or further step
is needed to be taken under the Act, that cannot be taken even
after the Act is repealed."

F 7. The expression "in relation to" appearing i_n Section 85(2)(a) of the
new Act refers to stage of arbitration proceedings under the old Act.
Reference is made to various provisions of the new Act employing the
words "arbitral proceedings" or "arbitral proceedings and award" to stress
that in the new Act there are different stages in the process of arbitration.
G Section 425 of the new Act uses the expression "arising out of that agree-
ment and the arbitral proceedings". There is a difference between the
-...
expressions "arising out of' and that "relating to".

8. Section 366 of the new Act is a deeming provision which provides
for the enforcement of the award as if it is a decree of a civil court under
H the Civil Procedure Code. This stage comes after application for setting
THYSSEN STAHLUNIOJ:l'GMBH v. STEEL AUTHORITY OFINDIA[D.P. WADHWA, J.) 483

aside of the arbitral· award under Section 34 has been been dealt with. This A
Court in Oil and Natural Gas Commission v. Western Company of North
America, [1987) 1 SCR 1024 while dealing with the old Act said that till an
award is transform¢d into a judgment and decree under Section 17 of the
Arbitration Act, 19~, it is altogether lifeless from the point of view of its
enforceability. Life is infused into the award in the sense of its becoming
B
enforceable only after it is made rule of the court upon the judgment and
decree and in terms of the award being passed.

9. Claim of the respondents that they had acquired vested right to
challenged the award under the old Act in view of Section 6 of the General

- Clauses Act is also incorrect. In this connection reference be made to · C
Section 100 of the Code of Civil Procedure, which was amended by Section
37 of the Code of Civil Procedure (Amendment) Act, 1976. Now, by
Section 100 provisions of second appeal were made more stringent. But
then the right which a party had acquired before the amendment came into
operation was saved specifically by clause (m) 7 of Section 97 of the Code D
of Civil Procedure (Amendment) Act, 1976.

Mr. S.G. Desai, learned counsel appearing for Rani Con;tructions,
supported Mr. Nariman in his submissions. He also said that the expression
"in relation to" appearing in Section 85(2)(a) refers to different stages of
E
arbitration proceedings under the old Act and does not cover the proceed-
ings after the award is given. We sum/llarise his submissions as well:

1. Parties can agree to the applicability of the new Act even before
5 "42. Jurisdiction. - Notwithstanding anything contained elsewhere in this Part or in any F
other law for the time being in force, where with respect to an arbitration agreement
any application under this part has been made in a court, that court alone shall have
jurisdiction over the arbitral proceedings and all subsequent applications arising out
of that agreement and the arbitral proceedings shall be made in that court and in no
other court. 0
__, 6 36. Enforcement - Where the time for making an application to set aside the arbitral
award under section 34 has expired, or such application having been made, it has been G
refused, the award shall be enforced under Code of Civil Procedure, 1908 (5 of 1908)
in the same manner as if it were a decree of the court.
7. "(m) the provisions of section 100 of the principal Act, as substituted by section 37 of
-~ this Act, shall not apply to or affect any appeal from an appellate decree or order which
_... had been admitted, .before the commencement of the said section 37, after hearing
under rule 11 of j)rder XLI, and evety such admitted appeal shall be dealt with as if
the said section ~7 had not come into force; 11 H
484 SUPREME COURT REPORTS [1999J SUPP. 3 S.C.R.

A the new Act comes into force. There is, however, bar that they cannot agree
to the applicability of the old Act after the new Act has come into force
when arbitration proceedings though under an agreement under the old
Act commence after the coming into force of the new Act. Reference may
be made to Sir Dinshaw Manekji Patil v. G.B. Badkas & Others, AIR (1969)
B Bombay 151 for the expression "for the time bei~g in force" and also
construction of the similar expression in Devkumafsingji Kasturchandji v.
State of Madhya Pradesh and Others, AIR (1967) M.P. 268. In Sir Dinshaw
Manekji Patit's case the question before the High Court was the scope of
the expression "in any law for the time being in force" as appearing in

-
clause (g) of Section 19(1) of the Defence of India Act, 1939. This clause
C is as under :
"(g) Save as provided in this section and in any rules made
, thereunder, nothing in any law for the time being in force shall
apply to arbitrations under this section."

D The learned single Judge of the High Court considered the expression "law
for the time being in force" and said that the natural import of the words
"for the time being" indicate indefinite future state of thing, and in this
connection reference was made to Stroud's Judicial Dictionary, (3rd Edi-
tion) Vol. IV page 3030 which is as follows :
E
"The phrase 'for the time being' may, according to its context, mean
the time present, or denote a single period of time, but its general
sense is that of time indefinite, and refers to an indefinite state of
facts which will arise in the future, and which may (and probably
·will) vary from time to time Ellison v. Thomas, (1861) 31 LJ Ch
F 867 and (1862) 32 LJ Ch 32; Coles v. Pack, (1869) LR 5 CP 65.
See also Re Gunter's Settlement Trust, (1949) Ch 502."

High Court said that in their ordinary sense, the words "law for the time
being in force" referred not only to the law in force at the time of the
G passing of the Defence of India Act but also to any law that may be passed
subsequently and which is in force at the time when the question of
applicability of such law to arbitrations held under said Section 19 arose.

In Devkumarsingji Kasturchandji v. State of Madhya Pradesh & Ors.,
AIR (1967) M.P. 268 (DB) Section 132(1) and Section 135 of the Madhya
H Pradesh Municipal Corporation Act, 1956 empowered the Municipal Cor-
· THYSSEN STAHLUNION GMBH v. STEEL AUTHORITY OF INDIA [D.P. WADHWA, J.) 485

poration to impose a tax on lands and buildings which the Corporation did A
under the exercise of that power. The State Legislature enacted a law
called the Madhya Pradesh Nagriya Sthavar Sampati Kar Adhiniyam, 1964
which provided for the levy of tax on lands and buildings in the urban areas
in the State of Madhya Pradesh. Sub-section (3) of Section 4 of the Madhya
Pradesh Corporation Act provided that the tax levied and payable under
that Act shall be in addition to any other tax for the time being payable
B
under any other enactment for the time being in force in respect of the
land or the building or portion thereof. Act of 1964 was challenged and
one of the grounds of challenge was that the State Legislature having
delegated its power to impose tax on lands and buildings in favour of the
·Municipal Corporation and Municipalities under the Municipal Corpora- c
tion Act, 1956 and the M.P. Municipalities Act, 1961 and the local
.... authorities having imposed a tax on lands and buildings, the State Legisla-
ture had no power to levy tax on lands and buildings. The Court said that
the expression "any other enactment for the time being in force" did not
mean an enactment which was already in force at the time the Corporation D
imposed a tax under Section 132 of the Municipal Corporation Act but
meant any legislation enacted whether before or after the imposition of

- the tax by the Corporation. The Court said that the general sense of the
words "for the time being" is that of time indefinite and refers to indefinite
state of facts which will arise in future and which may vary from time to
time. E

2. Section 288 of the_ Contract Act does not bar the agreement
8 "28. Agreements in res/Taint of legal proceedings void. - Every agreement, -
(a) by which any party thereto is restricted absolutely from enforcing his rights under
or in respect of any contract, by the usual legal proceedings in the ordinary F
tribunals, or which limits the time within which he may thus enforce his rights, or
(b) which extinguishes the rights of any party; or discharges any party thereto from
any liability; under or in respect of any contract on the expiry of a specified period
so as to r~strict any party from enforcing his rights is void to that extent.
Exception. 1. - Saving of con/Tact to refer to arbitTation dispute ihat may arise - This
section shall not render illegal a contract, by which two or more persons agree that any G
dispute which may arise between them in respect of any subject or class of subjects
shall be referred to arbitration and that only the amount awarded in such arbitration
· shall be re.coverable in respect of the dispute so referred.
Exception 2 - Saving of con/Tact to refer questions that have already arisen - Nor shall
t.his section render illegal any contract in writing, by whi_ch two or more persons agree
to ·refer to arbitration any question between them which has already arisen, or affect
any provision of any law in force for the time being as to reference to arbitration.' H
486 SUPREMECOURTREPORTS [1999]SUPP.3S.C.R.

A between the parties if they wish that arbitration proceedings be governed
by any enactment relating to arbitration that may be in force at the relevant
time.

3. Expression "unless otherwise agreed" used in Section 85(2)(a) of
the new act would clearly apply to the case (Civil Appeal No. 61of1999).
B Parties were clear in their mind that the old Act or any other statutory
modification or re-enactment of that Act would govern the arbitration:
Parties can anticipate that the new enactment may come into operation at
the time the disputes arise. It cannot be said that snrh an agreement is in
restraint of legal proceedings. Agreement can be entered into even before
C or after the new Act comes into force.

4. There is no right in procedure. Right to challenge the award is still
there in the new Act though now in the restricted form. It cannot be said
-
that any prejudice has been caused to a party when it has to challenge the
award under the new Act. High Court was wrong that the arbitration clause
D was hit by Section 28 of the Contract Act and that the agreement for the
application of the new Act has to be entered into only after the coming
into force of the new Act.

At this stage itself we may also note the submissions made by Mr.
-
E Krishnan Venugopal, counsel appearing for M/s. Clareheaven Ltd. (CA
4928/97) in support of the decision of the High Court holding that for
enforcement of the foreign award new Act would apply :

1. Section 85(2)(a) of the new Act cannot save the operation of the
Foreign Awards Act. On true construction of clause (a) it will have no
F application to the F~reign Awards Act, 1961. There is no accrued right in
favour of the appellant in CA No. 4928/97 to challenge the foreign award
under the Foreign Awards Act, 1961. Reference in this connection was
made to a decision of this Court in M.S. Shivananda v. Kamataka State
Road Transport Corporation & Ors., (1980] 1 SCC 149. In that case this
G Court said as under :

"In considering the effect of an expiration of a temporary Act, it
would be unsafe to lay down any inflexible rule. It certainly requires
very clear and unmistakable language in a subsequent Act of the
legislature to revive or re-create an expired right. If, however, the
H right created by the statute is of an enduring character and has
THYSSEN STAHLUNION GMBH v. STEEL AUTHORITY OF INDIA (D.P. WADHWA, J.) 487

vested in the person, that right cannot be taken away because the A
statute by which it was created has expired. In order to see whether
the rights and liabilities under the repealed Ordinance have been
put to an end by the Act, 'the line of enquiry would be.not whether",
in the words of Mukherjee, J. in State of Punjab v. Mohar Singh,
[1955) 1 SCR 893, 'the new Act expressly keeps alive old rights
and liabilities under the repealed Ordinance but whether it
B
manifests an intention to destroy them'. Another line of approach
may be to see as to how far the new Act is retrospective in
operation.

It is settled both on principle and authority, that the mere right C
existing under the repealed Ordinance, to take advantage of the
provisions of the repealed Ordinance, is not a right accrued.
Sub-section (2) of Section 31 of the Act was not intended to
preserve abstract rights conferred by the repealed Ordinance. The
legislature had the competence to so restructure the Ordinance as
to meet the exigencies of the situation obtaining after the taking D
over of the contract carriage services. It could re-enact the Or-
dinance according to its original terms, or amend or alter its
provisions."

Provisions of Foreign Awards Act, 1961 cannot be put into operation as E
that Act has been repealed. In this eventuality, Section 6 of the General
>-·
Clauses Act would apply. But then Western Shipbreaking Corporation did
not acquire any vested right to enforce the foreign award under the Foreign
Awards Act and as such Section 6 of General Clauses Act by implication
is inapplicable.
F
2. Western Shipbreaking Corporation did not acquire any vested
right as by the time the foreign award was made new Act had come into
force for enforcement of the foreign award. Reference was made to two
English decisions in Abbott v. The Minister for Lands, (1895) AC 425 and
Hamilton Gell v. White, (1922) 2 KB 422.
G
In Hamilton Gell v. White, (1922) 2 KB 422 (Court of Appeal) facts
are plainly stated in the head note, which we quote :

"In September, 1920, the landlord of an agricultural holding, being
desirous of selling it, gave his tenant notice to quit. By the H
488 SUPREME COURT REPORTS [1999] SUPP. 3 S.C.R.

A Agricultural Holdings Act, 1914, when the tenancy of a holding is
determined by a notice to quit given in view of a sale of the holding
the notice to quite is treated as an unreasonable disturbance within
s. 11 of the Agricultural Holdings Act, 1908, and the tenl!nt is
entitled to compensation upon the terms and subject to the con-
ditions of that section. One of the conditioi1s of the tenant's right
B to compensation under that section was that he should within two
months after the receipt of the notice to quite give the landlord
notice of his intention lo claim compensation, and another condi:
tion was that he should make his claim for compensation within
three months after quitting the holding. The tenant duly gave notice
c of his intention to claim compensation within the time so limited;
but before the tenancy had expired, and therefore before he could
satisfy the second condition, s. 11 of the Act of 1908 was repealed.
He subsequently made his claim within the three months limited
by the section."
D The: question was if the tenant has acquired any right for him to
maintain the claim. For that purpose the court was considering the
provisions of Section 38 of the English Interpretation Act, 1889, which
provides : "Where this Act or any Act passed after the commencement ~f
this Act re peals any other enactment, then, unless the contrary intention ..
E appears the repeal shall not ....... affect any right, privilege, obligation or
liability acquired, accrued or incurred under any enactment so repealed''·

Bankes LJ said :-

"Ill my opinion the tenant had acquired a right under s. 11 of the
F Act of 1908. This is not like the case which was cited to us Abbot
v. Minister for Lands, (1895) AC 425 in argument where the tenant's
· right depended upon some act of his own. Here it depends upon
the act of the landlord - namely, the giving of a notice to quit in
view of a sale - in which event the section itself confers a right
to compensation subject to the tenant complying with the condi-
G
tions therein specified, and so far as it was possible to comply with
them down to the time when the section was repealed he did in
fact comply with them. For these reasons I think the question must
be answered in the affirmative ....... "

H Scrutton LJ said :-
THYSSEN STAHLUNIONGMBH v. STEEL AUTHORITY OF INDIA [D.P. WADHWA, J.J 489

"The conditions imposed by s. 11 were conditions, not of the A
acquisition of the right, but of its enforcement. Sec. 38 says that
repeal of an Act shall not (c) "affect any right... .. acquired ...... under
any enactment so repealed" ,or (e) affect any investigation, legal
proceeding, or remedy in respect of any such right." As soon as
the tenant had given notice of his intention to claim compensation
under s. 11 he was entitled to have that claim investigated by an
B
arbitrator."

Atkin LI said :-
c
"It is obvious that that provision was not intended to preserve the
abstract rights conferred by the repealed Act, such for instance as
the right of compensation for disturbance conferred upon tenants
generally under the Act of 1908, for if it were the repealing Act
would be altogether inoperative. It only applies to the specific D
rights given to an individual upon the happening of one or other
of the events specified in the statute. Here the necessary event has
happened, because the landlord has, in view of a sale of the
property, given the tenant notice to quite. Under those circumstan-
ces the tenant has "acquired a right," which would "accrue" when
he has quitted his holding, to receive compensation. A case was E
cited in support of the landlord's contention : Abbott v. Minister
for Lands (1895) AC. 425, where the question was whether a man
who had purchased certain land was entitled to exercise a right to
make additional purchases of adjoining land under the powers
conferred by a repealed Act, the repealing Act containing the usual F
saving clause. The Privy Council held that he was not. They said
(1) that "the mere right (assuming it to be properly so called)
existing in the members of the community or any class of them to
take advantage of an enactment, without any act done by an
individual towards availing himself of that right, cannot properly G
be deemed to be a 'right accrued' within the meaning of the ·
enactment." I think that bears out the proposition that I have stated
above. The result is that the tenant in this case has acquired a right
to claim compensation under the Act of 1908 on his quitting his
holding, and therefore the second question asked by the arbitrator
should be answered in the affirmative." H
490 SUPREME COURT REPORTS [1999] SUPP. 3 S.C.R.

A 3. There can be no accrued right to have a decree or an award
enforced under a particular procedure that has been repealed by statute.
Reference was made to decision of this Court in Lalji Raja & Sons v. Firm
Hansraj Nathuram, [1971] 1 SCC 721 and of the House of Lords decision.
in the case of Kuwait Minister of Public Works v. Sir Frederick Snow and
B Partners, (1984) All ER 733.

In Lalji Raja & Sons v. Firm Hansraj Nathuram, [1971] 1 SCC 721
this Court relying on the decision of the House of Lords in Abbott v.
Minister for Lands, (1895) AC 425 said that "the mere right, existing at the
date of repealing statute, to take advantage of provisions of the statute
C repealed is not a 'right accrued' within the meaning of the usual saving
clause." Further relying on another decision in Hamilton Gell v. White,
(1922) 2 KB 422 the Court said that a provision to preserve the right
accrued under a repealed Act "was not intended to preserve the abstract
rights conferred by the repealed Act". "It only applies to specific rights
D given to an individual upon happening of one or the other of the events
specified in statute."

In Kuwait Minister of Public Works v. Sir Frederick Snow & Partners
(a firm) a11d Others, (1984) 1 All ER 733 (House of Lords) there. was a
contract between the parties entered into sometime in 1958 relating to the
E construction of an international airport in Kuwait. Parties to the contract
were the Government of the State of Kuwait and an English firm of civil
engineering consultants (English firm). Disputes having arisen award was
given by Kuwaiti arbitrator on September 15, 1973. The award required
payment by the English firm to the Government of the State of Kuwait an
F amount well over 3.5 Million. Proceedings to enforce the award were
initiated in England on March 23, 1979. In 1975 an Act with the title "An
Act to give effect to the New York Convention on the Recognition and
Enforcement of Foreign Arbitral Awards" came into force. The award was
a foreign award or a convention award. New York Convention came into
G being on June 10, 1958. United Kingdom became party to the Convention
on December 23, 1975 and the 1975 Act was passed to give effect to the
New York Convention. Kuwait became party to the Convention on July 27,
1978. On April 12, 1979 an Order in Council was. made declaring Kuwait
a party to the Convention. Now the award was made before Kuwait had
become party to the Convention but when proceedings were initiated to
H enforce the award Kuwait had done so. It was contended by the English
THYSSEN STAHLUNION GMBH v. STEEL AUTHORITY OF INDIA (D.P. WADHWA, J.] 491

firm that the foreign arbitral award could only qualify as a Convention A
award for the purpose of 1975 Act if the State in which it was made was
already a party to the Convention at the date of the award. Accordingly it
was contended that the award was not a convention award and could n~
be enforced by the State of Kuwait against the English firm. The plea of
the English firm was negatived. It was held that the award was maintainable
if the State in which the award was made is a party to the convention at
B
the date when proceedings to enforce the award began, even if it was not
a party at the date when the award was made. The court considered in all
Section 3 of the 1975 Act which provided : "An award made in pursuance
to an arbitration agreement in the territory of a State, other than the
United Kingdom, which is a party to the New York Convention shall, c
subject to the following provisions of this Act, be enforceable -". The court
said that the use of the present tense in the word 'is' in the phrase 'which
is a party to the New York Convention' must, as a matter of the ordinary
and natural interpretation of the words used, mean that the phrase relates
to the time of enforcement and not to any other time. In particular, if it D
had been the intention of the Legislature that the phrase should relate to
the date of the award, then the draftsman would surely have used the words
which made that intention clear such as 'which is and was at the date.pf
the award a party to the New York Convention'. The court repelling the
argument of the English firm observed as under :
E
"The first answer is that the presumption against interpreting a
statute as having retrospective effect is based on the assumption
that, if retrospective effect were to be given to it; the result would
be to deprive persons of accrued rights or.defences. In the present
case I am not persuaded that to give the 1975 Act retrospective F
effect in the sense which has been discussed would deprive
anybody either of an accrued right or of an accrued defence. On
the footing that awards made in a foreign state before that state
became a party to the convention are not convention awards for
the purposes of the 1975 Act, and cannot therefore be enforced
under it, the result is simply that a person wishing to enforce such G
an award in the United Kingdom would be obliged to bring an
action on it at common law, the right to do this being expressly
preserved by s. 6 of the 1975 Act. It cannot therefore be said that,
if the construction of the 1975 Act which I prefer is correct, the
result is to make an award, which could not previously have been H
492 SUPREME COURT REPORTS [1999] SUPP. 3 S.C.R.

A enforced against a person at all, newly enforceable against him
under the 1975 Act. On the contrary, the award could always have
been enforced against him by one form of procedure, and the only
result is that it subsequently becomes enforceable against him by
a second and alternative form of procedure."

B 4: The expression "in relation to" cannot expand the scope of the
saving clause in Section 85(2)(a) beyond "arbitral proceedings" to the
enforcement of an award. Section 85(2)(a) of the new Act saves only those
provisions of the old Act and the Foreign Awards Act that would apply to
arbitral 'proceedings and not the proceedings to enforce the arbitral award.
C Reference in this connection may be made to a decision of this Court in
Navin Chemicals Mfg. & Trading Co. Ltd. v. Collector of Customs, [1993] 4
sec 320.
In Navin Chemicals Mfg. & Trading Co. Ltd. 's case (supra) this Court
was considering the expression "the determination of any question having
D a relation to the rate of duty of customs or to the value of goods for
purposes of assessment" appearing in Section 129-C of the Customs
Act, 1962. Section 129-C of the Customs Act, 1962, in relevant part, is
as under:

"129-C. Procedure of Appellate Tribunal - (1) The powers and
E
functions of Appellate Tribunal may be exercised and discharged
by Benches constituted by the President from amongst the mem-
bers thereof.

(2) Subject to the provisions contained in sub- sections (3) and (4)
F a Bench shall consist of one judicial member and one technical
member.

(3) Every appeal against a decision or order relating, among other
things, to the determination of any question having a relation to
the rate of duty of customs or to the value of goods for purposes
G of assessment shall be heard by a Special Bench constituted ·by the
President for hearing such appeals and such Bench shall consist
of not less than two members and shall include at least one judicial
member and one technical member."

H This Court held that the appeal could have been heard and decided by a
THYSSEN STAHLUNION GMBH v. STEEL AUTHORITY OF INDIA [D.P. WADHWA, J.] 493

member of the Appellate Tribunal, sitting singly. It said that the phrase A
"relation to" is, ordinarily, of wide import but, in the context of its use in
the said expression in Section 129-C, it must be read as meaning a direct
and proximate relationship to the rate of duty and to the value of goods
for the purposes of assessment.

Mr. Dipankar Gupta, senior advocate, appearing,for the SAIL (in B
CA No. 6036/98) made his submissions which we record in brief :

1. There cannot be two segments : (1) uptil the award and (2) after
the award. While under Section 17 of the old Act an award has to be made
into a decree, under Section 36 of the new Act it is already stamped with C
the decree. The dispute is, thus, between the enforcement of the award and
the corrective process. Question is under which law, the corrective process
should take place? Section 85 of the new Act deals with transitional
provisions. When an award is made under the old Act, for its enforcement
provisions of the old Act have to be looked into. This is what Section
85(2)(a) of the new Act saves. D
2. Procedure for the appointment of arbitrator and holding of ar-
bitration proceedings and the making of award is different in the old Act
and in the new Act. Under the old Act, arbitrator is not required to give
reasons unless the agreement between the parties so envisages. Under the
E
new Act, however, arbitrator has to give reasons. This one illustration is
advanced to show that when arbitration proceedings have started before
coming into force of the new Act, then, under the new Act, the award may
not be sustainable.

3. When arbitration proceedings are held under the old Act, ar- F
bitrator. is conscious of Section 30 of the old Act which gives grounds for
setting aside the awards. Parties also proceed with that end in view. It is
difficult to comprehend a situation where though the award is given under
the old Act, its validity has to be decided under the new Act, provisions of
which are vastly different than that of the old Act. It is not possible that G
proceedings be split into two separate segments. This is not warranted by
the new Act.

4. The expression "in relation to" is significant. Ii is of widest
amplitude. If the Legislature intended that the new Act would apply to the
award given under the old Act made. after the coming into force of the new H
494 SUPREME COURT REPORTS [1999] SUPP. 3 S.C.R.

A Act, it would not use the expression "in relation to" but would use the word
"to". The expression "in relation to" takes into account stages after the
award. There is no difference between the expression "arising out" or "in
relation to" or "arising out of' which are expansive expressions and also
rather interchangeable. The expression "arising out of' has been used in
B Section 42 of the new Act. As to what these expressions mean, reference
may be made to decisions of the Supreme Court in Mis. Doypack Systems
Pvt. Ltd. v. Union of India & Ors., [1988] 2 SCC 299; Mansukhlal Dhanraj
Jain & Ors. v. Eknath Vithal Ogale, (1995] 2 SCC 665 and M/s. Dhanrajamal ..
Gobindram v. Mis. Shamji Kalidas & Co., (1961] 3 SCR 1020.

c In Mis. Doypack Systems Pvt. Ltd. 's case (1988] 2 SCC 299 this Court
was considering the expression "in relation to". In the context it will be
appropriate to quote paras 48, 49 and 50 of the judgment, which are as
under :

D "48. In view of the language used in the relevant provisions, it
appears to us that Section 3 has two limbs : (i) textile undertakings;
and (ii) right, title and interest of the company in relation to every
such textile undertaking. The expression "textile undertakings" has
been defined in Section 2(k) to mean the six textile undertakings
of the company specified therein. The definition of the said ex-
E pression in Section 2(k) is, however, subject to the opening words
of the section which ·provide, "In this Act, unless the context
otherwise requires". In the context of the expression "textile un-
dertakings" employed in Section 3(1) of the Act, Section 4(1)
provides that the textile undertakings referred to in Section 3 shall
.F be deemed to include all assets, rights, leaseholds, powers,
authorities and privileges and all property, movable and immov-
v
able, including lands, buildings, workshops, stores ..... investments
and book debts pertaining to the textile undertakings and all rights
and interest in or arising out of such property as are, immediately
before the appointed, day, in the ownership, possession, power or
G control of the company in relation to all six undertakings. The
expression "pertaining to", "in relation to" and "arising out of',
used in the deeming provision, are used in the expansive sense, as
per decisions of courts, meanings found in standard dictionaries,
and the principles of broad and liberal interpretation m con-
H sonance with Article 39(b) and (c) of the Constitution.
THYSSEN STAHLUNION GMBH v. STEEL AUTHORITY OF INDIA (D.P. WADHWA, J.] 495

49. The words "arising out of' have been used in the sense that it A
comprises purchase of shares and -lands from income arising out
of the Kanpur undertaking. We are of the opinion that the words
"pertaining to", and "in relation to" have the same wide meaning
and have been used interchangeably for among other reasons,
which may include avoidance of repetition of the same phrase in
the same clause or sentence, a method followed in good drafting.
B
The word "pertain" is synonymous with the word "relate", see
Corpus Juris Secundum, Volume 17, page 693.

50. The expression "in relation to" (so also "pertaining to"), is a
very broad expression which presupposes another subject matter. C
These are words of comprehensiveness which might have both a
direct significance as well as an indirect significance depending on
the context, see State Wakf Board v. Abdul Azeez, AIR (1968) Mad.
79 at 81 paras 8 and· 10), following and approving Nitai Charan
Bagchi v. Suresh Chandra Paul, (66 Cal WN 767), Shyam Lal v. M. D
Shayamlal, AIR (1933) All 649 and 76 Corpus Juris Secundum
621. Assuming that the investments in shares and in lands do not
form part of the undertakings but are different subject matters,
even then these would be brought within the purview of the vesting
by reason of the above expressions. In this connection reference E
may be made to 76 Corpus Juris Secundum at pages 620 and 621
where it is stated that the term "relate" is also defined as meaning
to bring into association or connection with. It has been clearly
mentioned that "relating to" has been held to be equivalent to or
synonymous with as to "concerning with" and "pertaining to". The
F
expression "pertaining to" is an expression of expansion and not
of contraction."

In Mansukhlal Dhanraj Jain and Others v. Ef<nath Vithal Ogale, [1995] 2
SCC 665 this Court was considering Section 41(1) of the Presidency Small
Cause Courts Act, 1882 and the scope of the expression "relating to the G
recovery of possession of any immovable property" appearing in that
Section. Section 41(1) is as under :

"41. (1) Notwithstanding anything contained elsewhere in this Act
or in any other law for the time being in force but subject to the H
496 SUPREME COURT REPORTS [1999] SUPP. 3 S.C.R.

A provisions of sub-section (2), The Court of Small Causes shall have
jurisdiction to entertain and try all suits and proceedings between
•
a licensor and licensee, or a landlord and tenant, relating to the · '
recovery of possession of any immovable property situated in
Greater Bombay, or relating to the recovery of the license fee or
charges or rent thereof, irrespective of the value of the subject-
B matter of such suits or proceedings."

It also referred to its earlier decision in Mis. Doypack Systems Pvt. Ltd. v.
Union of India and Others, [1988] 2 SCC 299. This Court held:

"It is, therefore, obvious that the phrase "relating to recovery of
c possession" as found in Section 41( 1) of the Small Cause Courts
Act is comprehensive in nature and takes in its sweep all types of
suits and proceedings which are concerned with the recovery of
possession of suit property from the licensee and, therefore, suits
for permanent injunction restraining the defendant from effecting
D forcible recovery of such possessions from the licensee-plaintiff
would squarely be covered by the wide sweep of the said phrase."

From M/s. Dhanrajamal Gobindram's case [1961] 3 SCR 1020 we quote the
following passage : .
E "We may dispose of here a supplementary argument that the
dispute till now is about the legal existence of the agreement
including the arbitration clause and that this is not a dispute arising
out of, or in relation to a cotton transaction. Reference was made
to certain observations in Heyman v. Darwins Ltd., (1942) AC 356.
F In our opinion, the words of the Bye-law "arising out of or in
relation to contracts" are sufficiently wide to comprehend matters,
which can legitimately arise under s. 20. The argument is that, when
a party questions the very existence of a contract, no dispute can
be said to arise out of it. We think that this is not correct, and
0

even if it were, the further words "in relation to" are sufficiently
G
wide to comprehend even such a case. In our opinion, this argu-
ment must also fail."

5. Distinction sought of the repealing provisions as contained in
Section 48 of the old Act and Section 85 of the new Act is not correct.
H Under Section 48 of the old Act, concept is of "reference while under the
THYSSEN STAHLUNION GMBH v. STEEL AUTHORITY OF INDIA[D.P. WADHWA, J.] 497

new Act it is "commencement". Section 2(e) of the old Act defines A
"reference". Earlier under Section 48, the word used was "to" but now
under Section 85(2)(a), it is the expression "in relation to". There would
certainly serious anomalies arise if the expression "in relation to" is given
restricted meaning.

6. It is not necessary that for the right to accrue, legal proceedings B
must be pending when the new Act comes into force. As to what the
accrued right is, reference was made to two decisions of this Court in
Commissioner of Income Tax, U.P. v. M/s. Shah Sadiq and Sons, [1987] 3
SCC 516 and Bansidhar & Ors. v. State of Rajasthan & Ors., [1989] 2 SCC
~ c
In Commissioner of Income Tax, U.P. v. Mis. Shah Sadiq and Sons,
[1987] 3 SCC 516 this Court was considering Section 6 of General Clauses
Act, 1897 with reference to the Income-Tax Act, 1922 repealed by Section
· 297 of the Income-Tax· Act, 1961. This is how this Court dealt with the
question raised before it : D
"14. Under the Income Tax Act of 1922, the assessee was entitled
to carry forward the losses of the speculation business and set off
such losses against profits made from that business in future years.
The right of carrying forward and set of accrued to the assessee
under the Act of 1922. A right which had accrued and had become
E
vested continued to be capable of being enforced notwithstanding
the repeal of the statute under which that right accrued unless the
repealing statute took away such right expressly or by necessary
implication. This is the effect of Section 6 of the General Clauses
Act, 1897. F
15. In this case the 'savings' provision in the repealing statute is
not exhaustive of the rights which are saved or which survive the
repeal of the statute under which such rights had accrued. In other
words, whatever rights are expressly saved by the 'savings'
provision stand saved. But; that does not mean that rights which G
are not saved by the 'savings' provision are extinguished or stand
ipso facto terminated by the mere fact that a new statute repealing
the old statute is enacted. Rights which have accrued are saved
unless they are taken away expressly. This is the principle behind
Section 6(c) of the General Clauses Act, 1897. The right to carry H
498 SUPREME COURT REPORTS [1999] SUPP. 3 S.C.R.

A forward losses which.had accrued under the repealed Income Tax
Act of 1922 is not saved expressly by Section 297 of the Income
Tax Act, 1961. But, it is not necessary to save a. right expressly in
order to keep it alive after the repeal of the old Aci of 1922. Section
6( c) saves accrued rights unless they are taken away by the repeal-
ing statute. We do not find any such taking away of the rights by
B Section 297 either expressly or· by implication."

In Bansidhar and Others v. State of Rajasthan and Others, [1989] 2 SCC 557
this Court referred to the observations made in I. T. Commissioner v. Shah
Sadiq and Sons, [1987] 3 SCC 516 and said a saving provision in a repealing
C statute is not necessarily exhaustive of the rights and obligations so saved
or the rights that survive the repeal. The Court ·said that for the purpose
of clauses (c) and (e) of Section 6 of the Rajasthan General Clauses Act,
1955 which provided, respectively, that the repeal of an enactment shall
not, unless a different intention appears, "affect any right, privilege, obliga-
tion or liability, acquired, accrued or incurred under any enactment so
D repealed" or "affect any investigation, legal proceeding or remedy in
respect of any such right, privilege, obligation, liability, fine, penalty, for-
feiture or punishment as aforesaid'', the "right" must be "accrued" and not
merely an inchoate one. Distinction between what is and what is not a right
preserved by Section 6 of the General Clauses Act is often one of great
E fineness, what is unaffected by the repeal is a right 'acquired' or 'accrued'
under the repealed statute and not "a mere hope or expectation or acquir-
ing a right or liberty to apply for a right. This Court relied on its earlier
decision in Lalji Raja & Sons v. Firm Hansraj Nathuram, 1971] 1 SCC 721.
It also referred to observation of Lord Morris in Director of Public Works
v. Ho Po Sang, (1961) 2 All ER 721, which had been quoted with approval
F in an earlier decision of this Court in M.S. Shivananda v. K.S.R. T. C., [1980]
1 sec 149, as under:

"It may be, therefore, that under some repealed enactment, a right
has been given but that, in respect of it, some investigation or legal
proceeding is necessary. The right is then unaffected and
G
preserved. It will be preserved even if a process of quantification,
is necessary. But there is a manifest distinction between an inves-
tigation in respect of a right and an investigation which is to decide
whether some right should be or should not be given. On a repel,
the former is preserved by the Interpretation Act. The latter is
H not."
THYSSENSTAHLUNIONGMBHv. STEELAUTHORITYOFINDIA[D.P. WADHWA,J.] 499

Mr. R.P. Bhatt, senior advocate appearing for Western Shipbreaking A
Corporation (CA No. 4928/97) submitted that it would be the Foreign
Awards Act that would apply and not the new Act. Mr. Bhatt supported
Mr. Dipankar Gupta in his submissions. All the three Acts are saved by
Section 85(2)(a). Arbitral proceedings include enforcement of award
otherwise these Acts would become redundant. He said that the arbitration
B
proceedings were governed by the laws in the U.K. under the (UK)
Arbitration Act, 1950. Proceedings began on May 15, 1995. Awards was
given in England on February 25, 1996 after the. new Act had come into
force on January 25, 1996. As to when arbitration proceedings commence·
have been given in Section 21 of the new Act. Under Section 32 of the new
Act, arbitral proceedings terminate by the final award. Since the
c
proceedings had already commenced in England, Section 21 of the new
Act has no application. Therefore, one has to look into the Foreign Awards
Act, 1961. Mr. Bhatt said pronouncement of an Arbitration Award after
the cut off date is not condition precedent for applicability of saving clause
under Section 85(2)(a). It does not use the words "Arbitral Award passed D
before" in place of "Arbitral Proceedings which commenced before". Thus
what is saved is applicability of all the provisions of the old Acts, where
the Arbitral proceedings have commenced before the cut off date and it is
further clarified in second portion of the saving clause viz., section 85(2)(a)
of the new Act that the new Act will apply where the Arbitral proceedings E
have commenced after the cut off date.

Mr. AK Ganguli, senior advocate, appeared for Himachal Pradesh
State Electricity Board (CA 61/99). He supported the impugned judgment
of the High Court. He drew distinction between the various provisions of F
the old Act and the new Act and said that the enforcement of the award
under the new Act would not be compatible with the arbitration proceed-
ings held under the old Act resulting in the award. Any restricted inter-
pretation to the expression "arbitral proceedings" appearing in Section
85(2)(a) would lead to several anomalies. One such instance was that under
the old Act arbitrator would not be required to give reasons unles~ the G
arbitration agreement so provided. He said when the savings clause makes
the provision of the old Act applicable to arbitral proceedings commencing
before January 25, 1996 without there being any further condition, the
legislative intent was clear that the old Act would apply to the enfcp-cement
of the award under that Act. He said such interpretation, apart from being H
500 SUPREME COURT REPORTS [1999] SUPP. 3 S:C.R.

A in conformity with the legislative intent, would also be in consonance with
justice, equity and fair pl.iy. Expression "arbitral proceedings" in Section
85(2)(a) could not be given restricted meaning of being confined merely to
the conduct of the proceedings by the arbitrator and excluding the enfor-
cement of the award from the purview of the old Act. Mr. Ganguli said
B that it was not disputed that provisions of the new Act were vastly different
than that of the old Act. He said use of the expression "provisions" in
Section 85(2)( a) would include all provisions of the old Act, insofar as they
have a nexus with the arbitral award. ·Enforcement of the award is integral
part of the process "in relation to arbitral proceedings". Reference was also
made to the meaning of expression "in relation to" and to various decisions
C of this Court in that connection. Provisions of Section 6 of General Clauses
Act were also invoked to contend that provisions of the old Act were saved
which included provisions for enforcement of the award under the old Act.
L~stly, Mr. Ganguli submitted that the agreement contemplated in the later
part of Section 85(2)(a) would be entered into only after the enforcement
D of the new Act and that is January 25, 1996. Any agreement if entered into
before this date would be void and would be hit by Section 28 of the
Contract Act and as rightly held so by the High Court. Accordingly, Mr.
Ganguli said that the clause in the arbitration agreement where the parties
agreed that provisions of the old Act or any statutory modification or
E re-enactment thereof "for the time being in force" would have no meaning
insofar as applicability of new Act to the enforcement of the award is
concerned. Parties could not agree to a provision in advance without
knowing what that provision would be.

Reference may yet be made to two more decisions of this Court on
F the question of effect of repeal of an enactment and as to what is right
accrued. In Gajraj Singh and Others v. State Transport Appellate Tribunal
and Others, [1997] 1 SCC 650 this Court was examining the provisions of
Section 217(1) and (2)(a) & (b) and (4) of the Motor Vehicles Act, 1988,
which contained repeal and saving provisions of the Motor Vehicles Act,
G 1939. The Court examined various judgments of this Court and Treatises
on the rules of interpretation and said :

"22. Whenever an Act is repealed it must be considered, except
as to transactions past and closed, as if it had never existed. The
H effect thereof is to obliterate the Act completely from the record
THYSSENSTAHLUNIONGMBHv. STEELAUTHORITYOFINDIA[D.P. WADHWA,J.] 501

of Parliament as if it had never been passed; it never existed except A
for the purpose of those actions which were commenced,
prosecuted and concluded while it was an existing law. Legal
fiction is one which is not an actual reality and which the law
recognises and the court accepts as a reality. Therefore, in case of
legal fiction the court believes something to exist which in reality B
does not exist. It is nothing but a presumption of the existence of
the state of affairs which in actuality is non-existent. The effect of
such a legal fiction is that a position which otherwise would not
obtain is deemed to obtain under the circumstances."

On the question on the right acquired or accrued the Court observed :- c
"42. There is a distinction between right acquired or accrued, and
privilege, hope and expectation to get a right, as rightly pointed
out by the High Court in the impugned judgment. A right to apply
for renewal and to get a favourable order would not be deemed D
to be a right accrued unless some positive acts are done, before
repeal of Act 4 of 1939 or corresponding law to secure that right
of renewal. In Gujarat Electricity Board v. Santi/al R. Desai, AIR
(1969) SC 239 : (1969] 1 SCR 580 this Court had pointed out that
before Section 71 of the Electricity (Supply) Act, 1948 was E
amended, the appellant had issued a notice under Section 7 there-
of, exercising the option to purchase the undertaking. It was held
_that a right to purchase the electrical undertaking which had
accrued to the Electricity Board was saved by Section 6 of the GC
Act."
F
In G. Ekambarappa & Ors. v. Excess Profits Tax Officer, Bellary,
(1967] 3 SCR 864. In that case District Bellary, which belonged to Part 'A'
State of Madras in British India, was merged in Part 'B' State of Mysore
on October 1, 1953. The Excess Profits Act, 1940 applied only to British
India. It ceased _to apply to the Bellary after it became part of the State of G
Mysore. Then, after States Reorganisation Act, 1956, Mysore also became
Part 'A' State. However, by the Adaptation of Laws (No. 3) Order dated
December 31, 1956, the Excess Profits Tax Act was to extend "to the
whole of India except the territories which immediately before November
1, 1956 were comprised in Part 'B' States". The result of adaptation was H
502 SUPREME COURT REPORTS [1999]SUPP. 3 S.C.R.

A that all the provisions of the Excess Profits Tax Act, 1940 stood repealed
so far as the District of Bellary was concerned w.e.f. December 21, 1956.
Excess profits Tax Officer issued a Notice under Section 15 of the Excess
Profits Tax Act to the appellants in 1960 in respect of the period from
October 30, 1943 to October 30, 1944. It was contended by them that it
B was not a case of repeal of that Act and so the provisions of Section 6 of
the General Clauses Act could not be invoked to sustain the validity of the
notices. It was argued that so far as the Excess Profits Tax Act was
concerned, the Adaptation Laws Order 1956 did not repeal that Act as
such and the effect of the modification was that the provisions of the Act
C were no longer applicable to the Bellary District which comprised in the
territory of Part 'B' State of Mysore immediately before November 1, 1956.
This Court said that there was no justification for the argument put forward
on behalf of the appellants. The Court proceeded to repel this argument
as under:

D "The result of the Adaptation of Laws Order 1956 so far as the
Act was concerned, was that the provisions of that Act were no
longer applicable or in force in Bellary District. To put it different-
ly, the Act was repealed so far as the area of Bellary District was
concerned. Repeal of an Act means revocation or abrogation of
the Act and, in our opinion, s. 6 of the General Clauses Act applies
E even in the case of a partial repeal or repeal of part of an Act:
Section 6 of the General Clauses Act states :

"Effect of repeal. - Where this Act or any Central Act or Regula-
tion made after the commencement of this Act, repeals any enact-
F ment hitherto made or hereafter to be made, then, unless a
different intention appears, the repeal shall not -

(c) affect any right, privilege, obligation or liability acquired, ac-
G crued or incurred under any enactment so repealed; or

Section 3(19) of the General Clauses Act defines an ~nactment"
as including "a Regulation and also as including any provision
H contained in any Act or in any such Regulation as aforesaid''.
THYSSENSTAHLUNIONGMBHv. STEELAUTHORITYOFINDIA(D.P. WADHWA,J.) 503

The argument was also stressed on behalf of the appellants that A
even ifs. 6( c) of the General Clauses Act was applicable there was
no "liability incurred or accrued" as there was no assessment of
escaped profits before November 1, 1956 when the adaptation was
made. We do not think there is any substance in this argument.
The liability of the appellants to tax arose immediately at the end
of the chargeable accounting period and not merely at the time
B
when it is quantified by assessment proceedings. It follows there-
fore that the notice issued under s. 15 of the Act was legally valid
and the appellants representing the original partners of the firm
continued to be liable to be proceeded against under that section
for the profits which had escaped taxation." c
The Conclusions :

For the reasons to follow, we hold :

:\.. The provisions of the old Act (Arbitration Act, 1940) shall apply D
in relation to arbitral proceedings which have commenced before coming
into force of the new Act (The Arbitration and Conciliation Act, 1996).

2. The phrase "in relation to arbitral proceedings" cannot be given a
narrow meaning to mean only pendency of the arbitration proceedings
before the Arbitrator. It would cover not only proceedings pending before E
the Arbitrator but would also cover the proceedings before the Court and ·
any proceedings which are required to be taken under the old Act for
award becoming decree under Section 179 thereof and also appeal arising
thereunder.
F
3. In cases where arbitral proceedings have commenced before com-
ing into force of the new Act and are pending before the Arbitrator, it is
open to the parties to agree that new Act be applicable to such arbitral
proceedings and they can so agree even before the coming into force .of
the new Act.
~- { G
9. "I 7. Judgment in terms of award - Where the Court sees no cause to remit the award
or any of the matters, referred to arbitration for reconsideration or to set aside the
award, the Court shall, after the time for making an application to set aside the award
has expired, or such application having been made, after refusing it, proceed to
pronounce judgment according to the award, and upon the judgment so pronounced a
decree shall follow, and no appeal shall lie from such decree except on the ground that
it is in excess of, or not otherwise in accordance with the award." H
504 SUPREME COURT REPORTS [1999] SUPP. 4S.C.R.

A 4. The new Act would be applicable in relation to arbitral proceed-
ings which commenced on or after the new Act comes into force.

5. Once the arbitral proceedings have commenced, it cannot be
stated that right to be governed by the old Act for enforcement of the
award was an inchoate right. It was certainly a right accrued. It is not
B imperative that for right to accrue to have the award enforced under the
old Act that some legal proceedings for its enforcement must be pending
under that Act at the time new Act came into force.

6. If narrow meaning of the phrase "in relation to arbitral
C proceedings" is to be accepted, it is likely to create great deal of confusion
with regard to the matters where award is made under the old Act.
Provisions for the conduct of arbitral proceedings are vastly different in
both the old and the New Act. Challenge of award can be with reference
to the conduct of arbitral proceedings. An interpretation which leads to
unjust and inconvenient results cannot be accepted.
D F
'
7. A foreign award given after the commencement of the new Act
can be enforced only under the new Act. There is no vested right to have
the foreign award enforced under the Foreign Awards Act (Foreign
Awards (Recognition and Enforcement) Act, 1961).
E
Section 85(2)(a) of the new Act is in two limbs : (1) Provisions of
the old Act shall apply in relation to arbitral proceedings which.
commenced before the new Act came into force unless otherwise agreed
by the parties and (2) new Act shall apply in relation to arbitral
proceedings which commenced on or after the new Act came into force.
F First limb can further be bifurcated into two : (a) Provisions of old Act
shall apply in relation to arbitral proceedings commenced before the new
Act came into force and (b) old Act will not apply in such cases where the
parties agree that it will not apply in relation to arbitral proceedings which
commenced before the new Act came into force. The expression "in
G relation tc(, is of widest import as held by various decisions of this Court
in M/s. Doypack Systems Pvt. Ltd. (1988] 2 SCC 299; Mansukhlal Dhanraj
Jain & Ors. [1995] 2 SCC 660; Mis. Dhanrajama/ Gobindram (1961] 3~CR
1020 and Naveen Chemicals Mfg. & Ors. (1993] 4 SCC 320. This expression
"in relaticlri to" has to be given full effect to, particularly when read in
H conjunction with the word "the provisions" of the old Act. That would .
THY SS EN STAHLUNION GMBH v. STEEL AUTHORITY OF INDIA [D.P. WADHWA, J. J 505

mean that the old Act will apply to whole gambit of arbitration culminating A
-,. in the enforcement of the award. If it was not so, only the word "to" could
have sufficed and when the legislature has used the expression "in relation
to", a proper meaning has to be given. This expression does not admit of
restrictive meaning. First limb of Section 85(2)( a) is not a limited saving
clause. It saves not only the proceedings pending at the time of
·(
B
commencement of the new Act but also the provisions of the old Act for
enforcement of the award under that Act.
"
The contention that if it is accepted that the expression "in relation
to" arbitral proceedings would include proceedings for the enforcement of
the award as well, the second limb of Section 85(2)(a) would become c
superfluous. We do not think that would be so. The second limb also takes
into account the arbitration agreement entered into under the old Act
... when the arbitral proceedings commenced after the coming into force of
the new Act. Reference in this connection be made to a decision of this

.
A

~
Court in MMTC Ltd. v. Sterlite Industries (India) Ltd., [1996] 6 SCC 716 D
where this Court held that validity of an arbitration agreement did not
depend on the number of arbitrators specified in Section 7 of the new Act
and that the number of arbitrators is dealt with separately under Section
10 of that Act whic,h is a part of machinery provision for working of the
arbitration agreement. In this case the question which came up for decision E
was the effect of the new Act on the arbitration agreement made prior to
the commencement of the new Act which provided for appointment of one
arbitrator by each of the parties who shall appoint an umpire before
proceeding with the reference. The agreement was entered into on
December 14, 1993 before the coming into force of the new Act. Section
10 of the new Act provides that parties are free to determine the number
F
of arbitrators, provided that such number shall not be an even number.
Further failing the determination of odd number of arbitrators, the arbitral
tribunal shall consist of a sole arbitrator. This Court upheld the validity of
the arbitration agreement dated December 14, 1993 and directed the Chief
Justice of the High Court concerned to appoint the third arbitrator under G
Section 11(4)(b) of the new Act in view of the failure of the two appointed
mbitrators to appoint the third arbitrator. In this case it may be noticed
• that the respondent had invoked arbitration clause in the agreement by
letter dated January 19, 1996 which was received by the appellant on
January 31, 1996. The arbitral proceedings would, therefore, commence H
506 SITTREME COURT REPORTS [1999] SUPP. 3 S.C.R.

·. A under Section 21 of the new Act on January 31, 1996 as by that time new
Act had come into force.

In this view of the matter, Section 6 of the General Clauses Act
would be inapplicable. It is, therefore, not necessary for us to examine if
any right to enforce the award under the old Act accrued to a party when
B arbitral proceedings had commenced before the coming into force of the
new Act and the SAIL (CA 6036/98) had acquired a right to challenge the
award made under the old Act and there would be corresponding right
with the Thyssen to enforce the award under the old Act.

C Present day the courts tend to adopt purposive approach while
interpreting the statute which repeals the old law and for that purpose to
take into account the objects and reasons which led to the enacting of the
new Act. We have seen above this approach was adopted by this Court in
MMTC Ltd. 's case [1996] 6 SCC 716. Provisions of both the Acts, old and
new are very different and it has been so observed in Sundaram Finance
·D Ltd. 's case (1999] 2 SCC 479. In that case, this Court also said that
provisions of the new Act have to be interpreted and construed inde-
pendently and that in fact reference to old Act may actually lead to the
misconstruction of the provisions of the new Act. The Court said that it
will be more relevant, while construing the provisions of the new
E Act, to refer to the UNCITRAL Model Law rather than the old Act. In
the case of Kuwait Minister of Public Works v. Sir Frederick Snow and
Partners, (1984) 1 ALL ER 733 HL the award was given before Kuwait
became party to the New York Convention recognised by Order in Council
in England. House of Lords held that though a foreign award could be
enforced in England under the (U .K.) Arbitration Act, 1975 as when the
F proceedings for enforcement of the award were initiated in England
Kuwait had become party to the Convention. It n'egatived the contention
that on the date the award was given Kuwait was not party to the New
York Convention.

G In Pepper v. Hart, (1993) 1 All. ER 42 House of Lords for the first
time accepted the principle that Judges could refer to the Parliamentary
debates in order to ascertain the meaning of an Act of Parliament. Lord
Griffiths said (at page 50) :

"The days have long passed when the courts adopted a strict
H constructionist view of interpretation which required them to adopt
THYSSEN STAHLUNION GMBH v. STEEL AUTHORITY OF INDIA [D.P. WADHWA, J.] 507

the literal meaning of the language. The courts now adopt a A
purposive approach which seeks to give effect to the true purpose
of legislation and are prepared to look at much extraneous material
that bears upon the background against which the legislation was
enacted."

B
But then if the construction of the new Act leads to inconvenient and unjust
results, the concept of purposive approach has to be shed. Multiple and
complex problems would arise if the award given under the old Act is said
to be enforced under the new Act. Both the Acts are vastly different to
each other. It has been rightly contended that when arbitration proceedings
are held under the old Act, the parties and the arbitrator keep in view the c
provisions of that Act for the·enforcement of the award. As noted above,
under the old Act, there is no requirement for the arbitrator to give reasons
for the award. That is not mandatory under the new Act. Section 27 of the
old Act provides that arbitrator or umpire may, if they think fit, make an
interim award, unless of course different intention appears from the ar- D
bitration agreement. Interim award is also an award and can be enforced
in the same way as the final award. It would certainly be a paradoxical
situation if for the interim award, though given after the coming into force
of the new Act, it would still be the old Act which would apply and for the
final award, it would be the new Act. Yet another instance would be when
under Section 13 of the old Act, the arbitrators or umpire have power to E
state a special case for the opinion of the Court on any question of law
involved in the proceedings. Under sub- section (3) of Section 14 of the
old Act when the Court pronounces its opinion thereon such opinion shall
be added to and shall form part of the award. From this part of the award
no appeal is maintainable under Section 39 of the old Act. There is no such F
provision under the new Act. In Sohan Lal & Ors. v. Amin Chand and Sons
& Ors., [1974] 1 SCR 453. This Court was considering the powers of
arbitrator under Section 13 of the old Act. Clause (b) of Section 13
provided that arbitrators or umpire shall have power to state a special case
for the opinion of the court on any question of law involved, or state the
award, wholly or in part, in the form of a special case of such question for G
the opinion of the court. Section 14 of the old Act provides for the award
to be signed and filed. Under sub-section (3) of Section 14 where the
arbitrators or umpire state a special case under clause (b) of Section 13,
the court, after giving notice to the parties and hearing them, shall
pronounce its opinion thereon and such opinion shall be added to, and H
508 SUPREME COURT REPORTS [1999] SUPP. 3 S.C.R.

A shall form part of, the award. This Court said :

"We do not think that an opinion given under the first part of s.
13(b) should be added to and form part of the award. The reason
why the opinion given under the latter part of s. 13(b) should be
added to and becomes part of the award is because the arbitrators
B have stated the award wholly or in part in the form of a special
case of such question for the 'opinion of the court. This view is
further strengthened by the circumstance. that under s. 39(1)(ii),
an appeal is provided only against an order on an award stated in
the form of a special case. The reason why an appeal is provided
c for in such a case is that the opinion of the court has to be added
to and form part of the award and it therefore becomes a decision
of the court, notwithstanding the fact that it is incorporated in the
award. There is no provision for an appeal against an opinion given
by the court on a special case stated to the court under the first
part of s.13(b) or against the decision to state a special case for
D
the opinion of the court for the reason that the opinion is not a
decision. Nor is it to be incorporated in the award. If, as a matter
of fact, the opinion given by the court on a special case stated ..
under first part of s.13(b) is binding on the arbitrators and has to
be incorporated in the award, there was no reason why the legis-
E lature should not have provided for an appeal against the opinion
or against the reference which led to the opinion. The scheme of
the Act shows that the legislature wanted to provide for an appeal
only when there is to be a decision by the court binding on the
parties, not when it tenders an opinion which is not binding on the
arbitrators and which is not to be incorporated .in the award. It
F
might be that the arbitrator may choose to act upon the opinion.
But that is not for the reason that it is a binding determination or
a decision. We have, therefore, no hesitation in holding that the
appeals are incompetent."

G Section 85(2)(a) is the saving clause. It exempts the old Act from
complete obliteration so far as pending arbitration proceedings are con-
cerned. That would include saving of whole of the old Act uptill the time
of the enforcement of the award. This Section 85(2)(a) prevents the
accrued right under the old Act froin being affected. Saving provision
H preserves the existing right accrued under the old Act. There is a presump-
THYSSEN STAHLUNION GMBHv. STEEL AUTHORITY OF IND!AfD.P. WADHWA, J.) 509

tion that Legislature does not intend to limit or take .away vested rights A
. unless the language clearly points to the contrary. It is correct that the new
Act is a remedial statute and, therefore, Section 85(2)(a) calls for strict
construction, it being a repealing provision. But then as stated above where
one interpretation would produce an unjust or an inconvenient result and
another would not have those effects, there is then also a presumption in
favour of the latter.
B

Enforcement of the award, therefore, has to be examined on the
touchstone of the proceedings held under the old Act.

- Various decisions have been cited before us to show as to what is a C
mere right and what is right accrued or acquired. We have to examine this
question with reference to the provisions of Section 6 of the General
Clauses Act if it could be said that when the arbitral proceedings have
commenced under the old Act, a party has acquired a right to have the
award given thereafter enforced under the old Act. The question that arises
for consideration is if a right has accrued to the party or it is merely an D
inchoate right. The three cases referred to, namely, Abbott v. The Minister
for Lands, (1895) AC 425 PC; Hungerfort Investment Trnst Ltd. v. Haridas
Mundhra & Ors., [1972] 3 SCR 690 and D.C. Bhatia & Ors. v. Union of India
& Anr., [1995] 1 SCC 104 show that something more is required for vested
right to accrue. Right did exist but then nothing was done to show that any E
act was done or advantage taken of the enactment under which the right
existed till it was repealed. An Act gave the right and the new Act which
repealed the old Act took away that right. Mere right to take advantage of
the provision of an Act is not a right accrued.

In I. T. Commissioner v. Shah Sadiq & Sons, [1987] 3 SCC 516 this F
Court said that right which had accrued and had become vested continued
to be capable of being enforced notwithstanding the repeal of the statute
under which that right accrued unless the repealing statute took away such
right expressly or by necessary implication. In the case of Bansidhar & Ors.
v. State of Rajasthan & Ors., [1989] 2 SCC 557 this Court had said that what G
is unaffected by the repeal is a right "acquired" or "accrued" under the
repealed statute and not "a mere hope or expectation" of acquiring a right
or liberty to apply for a right. In the case of Lalji Raja Sons v. Finn Hansraj
Nathuram, [1971] 1 SCC 721 this Court had said that "a provision to
preserve the right accrued under a repealed Act was not . intended to H
510 SUPREME COURT REPORTS (1999] SUPP. 3 S.C.R.

A preserve the abstract rights conferred by the repealed Act. It only applies
to specific rights given to an individual upon happening of one or the other
of the events spesified in statute." We think the observations of Lord ·
Morris in Director of Public Works v. Ho Po Sang, (1961) 2 ALL E.R. 721
are quite apt which have been quoted elsewhere in the judgment. In M.S.
B Shivanda v. K.S.R. T.C., (1980] 1 SCC 149 this Court again said that if the
right created by the statute is of an enduring character and has vested in
the person, the right cannot be taken away because the statute by which it
· was created has expired. In Hemilton Gell v. White, [1922) 2 KB 422 Court
of Appeal referred to the decision of the House of Lords in Abbott v.
C Minister for Lands, (1895) A.C. 425. In the case before it, the Court said
that under the old Act (the Agricultural Holdings Act, 1908) which was
repealed by the Agricultural Holdings Act, 1914 necessary event had
happened under which the tenant "acquired a right" which would accrue
when he was quitting his holding to receive compensation from the
D landlord. The event which occurred was the notice by the landlord to quit
to the tenant in view of a $ale of the holding. While Section 11 of the 1908
Act treated this as unreasonable disturbance to the tenant entitling him to
compensation, the latter Act of 1914 repealed Section lL The Court held
that in spite of the repeal of Section 11 tenant had acquired right to claim
compensation inasmuch as notice to quit was given to him when Section
E 11 of the old Act was in operation. In Gajraj Singh & Ors. v. State Transport
Appellate Tribunal & Ors., [1997] 1 SCC 650 this Court said that some
positive Act is required to be done for the right to accrue under enactment
which is repealed. In this case reference was made to a decision of this
Court in Gujarat Electricity Board v. Shanti/al R. Desai, AIR (1969) SC 239
F = (1969) l SCR 580 where the Court had pointed out that before Section
71 of the Electricity (Supply) Act, 1948 was amended, the appellant had
issued a notice under Section 7 thereof, exercising the option to purchase
the undertaking. It was held that a right to purchase the electrical
undertaking, which had accrued to the Electricity Board, was saved by
G Section 6 of the General Clauses Act. In the case of G. Ekambarappa &
Ors. v. Excess Profits Tax Officer, Bellar;', [1967] 3 SCR 864 there was repeal
of an enactment levying tax. No assessment had been made by the time the .
Act was repealed and there could, therefore, be no liability. Nevertheless,
this Court said that liability to tax arose immediately at the end of the
H accounting period when the Act was in force though the liability had not
THYSSEN STAHLUNION GMBH v. STEEL AUTHORITY OF INDIA [D.P. WADHWA, J.l 511

been quantified by assessment proceedings. The Court upheld validity of A
the notice for assessment of proceedings after the repeal of the Act.

Principles enunciated in the judgments show as to when a right
accrues to a party under the repealed Act. It is not necessary that for the
right to accrue that legal proceedings must be pending when the new Act B
comes into force. To have the award enforced when arbitral proceedings
commenced under the old Act under that very Act is certainly an accrued·
right. Consequences for the parties against whom award is given after
arbitral proceedings have been held under the old Act though given after
the coming intQ force of the new Act, would be quite grave if it is debarred
from challenging the award under the provisions of the old Act. Structure C
of both the Acts is different. When arbitral proceedings commenced under
the old Act it would be in the mind of everybody, i.e., arbitrators and the
parties that the award given should not fall foul of Sections 30 and 32 of
the old Act. Nobody at that time could have thought that Section 30 of the
old Act could be substituted by Section 34 of the new Act. As a matter of D
fact appellant Thyssen in Civil Appeal No. 6036/98 itself understood that
the old Act would apply when it approached the High Court under
Sections 14 and 17 of the old Act for making the award rule of the Court.
It was only later on that it changed the stand and now took the position
that new Act would apply arid for that purpose filed an application for
execution of the award. By that time limitation to set aside the award under E
the new Act had elapsed. Appellant itself led the respondent SAIL in
believing that the old Act would apply. SAIL had filed objections to the
award under Section 30 of the old Act after notice for filing of the award
was received by it on the application filed by the Thyssen under Sections
14 and 17 of the old Act. We have been informed that numerous such p
matters are pending all over the country where the award in similar
circumstances is sought to be enforced or set aside under the provisions of
the old Act. We, therefore, cannot adopt a construction which would lead
to such anomalous situations where the party seeking to have the award
set aside finds himself without any remedy. We are, therefore, of the
opinion that it would be the provisions of the old Act that would apply to G
the enforcement of the award in the case of Civil Appeal No. 6036 of 1998.
Any other construction on the Section 85(2)(a) would only lead to the
confusion and hardship. This construction put by us is consistent with the
wording of Section 85(2)(a) using the terms "provision" and "in relation to
arbitral proceedings" which would mean that once the arbitral proceedings H
512 SUPREME COURT REPORTS [1999] SUPP. 3 S.C.R.

A commenced under the old Act it would be the old Act which would apply
for enforcing the award as well.

Because of the view of Section 85(2)(a) of the new Act which we
have taken, it is not necessary for us to consider difference in the repealing
provisions as contained in Section 48 of the old Act and Section 85 of the
B new Act. We may, however, note that under Section 48 of the old Act
concept is of "reference" while under the new Act it is "commencement''.
Section 2(e) of the old Act defines "reference". Then under Section 48 the
word used is "to", and under Section 85(2)(a) the expression is "in relation
to". It, therefore, also appears that it is not quite relevant'to consider the
C provision of Section 48 of the old Act to interpret Section 85(2)(a).

In Hoosein Kasam Dada (India) Ltd. v. The State of Madhya Pradesh
and Others, [1953) SCR 987, this Court said that pre-existing right of appeal
is not destroyed by the amendment if the amendment is not retrospective
D by express words or necessary intendment. The fact that the pre-existing
right of appeal continues to exist must, in its turn, necessarily imply that
the old law which created that right of appeal must also exist to support
the continuation of that right. In this case, law had changed and the
appellate authority could exercise jurisdiction only if the appeal was ac-
companied by the deposit of the assessed tax when before the amendment
E of the provision it only provided for deposit of admitted tax. The Court
said that any requirement for deposit of the assessed tax overlooks the fact
of existence of the old law for the purpose of supporting the pre-existing
right where appeal could be filed only on depositing the admitted amount
of tax. The law interpreted by this Court in this judgment, it seems, is to
F what Civil Procedure Code (Amendment) Act provided by clause (m) of
Section 97 of the Code of Civil Procedure (Amendment) Act.

Parties can agree to the applicability of the new Act even before the
new Act comes into force and when the old Act is still holding the field.
G There is nothing in the language of Section 85(2)(a) which bars the parties
from so agreeing. There is, however, a bar that they cannot agree to the
applicability of the old Act after the new Act has come into force when
arbitral proceedings under the old Act have not commenced though the
arbitral agreement was under the old Act. Arbitration clause in the con-
tract in the case of Rani Constructions (Civil Appeal 61 of 1999) uses the
H expression "for the time being in force" meaning thereby that provision of
= THYSSEN STAHLUNION GMBH v. STEEL AUTHORITY OF INDIA [D.P. WADHWA, J.) 513

that Act would apply to the arbitration proceedings which will be in force A
at the relevant time when arbitration proceedings are held. We have been
referred to two decisions - one of Bombay High Court and the other of
Madhya Pradesh High Court on the interpretation of the expression ''for
the time being in force" and we agree with them that the expression
aforementioned not only refers to the law in force at the time the arbitra-
tion agreement was entered into but also to any law that may be in force
B
for the conduct of arbitration proceedings, which would also include the
enforcement of the award as well. Expression "unless otherwise agreed" as
appearing in Section 85(2)( a) of the new Act would clearly apply in the
case of Rani Construction in Civil Appeal No. 61 of 1999. Parties were
clear in their minds that it would be the old Act or any statutory modifica- c
tion or re-enactment of that Act which would govern the arbitration. We
accept the submission of the appellant Rani Construction that parties could
anticipate that the new enactment may come into operation at the time the
disputes arise. We have seen Section 28 of the Contract Act. It is difficult
for us to comprehend that arbitration agreement could be said to be in D
restraint of legal proceedings. There is no substance in the submission of
respondent that parties could not have agreed to the application of the new
Act till they knew the provisions thereof and that would mean that any such
agreement as mentioned in the arbitration clause could be entered into
only after the new Act had come into force. When the agreement uses the
expressions "unless otherwise agreed" and "law in force" it does give E
option to the parties to agree that new Act would apply to the pending
arbitration proceedings. That agreement can be entered into even before
the new Act comes into force and it cannot be said that agreement has to
be entered into only after coming into force of the new Act.
F
Mr. Desai had referred to a decision of the Bombay High Court
(Goa Bench), rendered by single Judge in Reshma Constructions v. State
of Goa, (1999) 1 MU 462. In that case arbitration clause in the contract
provided as under :

"Subject as aforesaid, the provisions of the Arbitration Act, 1940 G
or any statutory modification or re- enactment thereof and the
rules made thereunder and for the time being in force shall apply
to the arbitration proceeding under this clause."

The Court held that these terms in the clause disclosed that the H
514 SUPREME COURT REPORTS [1999) SUPP. 3 S.C.R.

A parties had agreed to be governed by the law which was in force at the
time of execution of the arbitration agreement as well as by any further
statutory changes that may be brought about in such law. This is how the
High Court considered the issue before it :

"Considering the scheme of the Act, harmonious reading of the
B said provision contained in sub-section (2) of Sec. 85 thereof would
disclose that the reference "otherwise agreed" necessarily refers
to the intention of the parties as regards the procedure to be
followed in the matter of arbitration proceedings and not to the
time factor as regards execution of the agreements. It provides that
c though the law provides that the provisions of the old Act would
continue to apply to the pending proceedings by virtue of the said
saving clause in Sec. 85, it simultaneously provides that the parties
can agree to the contrary. Such a provision leaving it to the
discretion of the parties to the proceedings to decide about the
D procedure to be followed - other in terms of the new Act or the
old Act - is certainly in consonance with the scheme of the Act,
whereunder most of the provisions of the new Act, the procedure
regarding various stages of the arbitration proceedings is made
subject to the agreement to the contrary between the parties,
E thereby giving ample freedom to the parties to decide about the
procedure to be followed in such proceedings; being so, it is but
natural that the legislature in its wisdom has left it to the option
of the parties in the pending proceedings to choose the procedure
for such pending proceedings. The reference "otherwise agreed by
F the parties" .in Sec. 85(2)(c) of the new Act, therefore, would
include an agreement already entered into between the parties
even prior to enforcement of the new Act as also the agreement
entered into after enforcement of the new Act. Such a conclusion
is but natural since the expression "otherwise agreed" do not refer
to the time factor but refers to the intention of the parties regarding
G ·-...
applicability of the provisions of the new or old Act."

We agree with the High Court on interpretation put to the arbitration
clause in the contract.

H Section 28 of.the Contract Act contains provJS1on regarding
THYSSEN STAHLUNION GMBHv. STEEL AUTHORITY OF INDIA(D.P. WADHWA,1.J 515

agreements in the restraint of legal proceedings. Exception 1 to Section 28 A
of the Contract Act does not render illegal a contract by which the parties
agree that any future dispute shall be referred to arbitration. That being
so parties can also agree that the provisions of the arbitration law existing
at that time would apply to the arbitral proceedings. It is not necessary for
the parties to know what law will be in force at the time of the conduct of
B
arbitration proceedings. They can always agree that provisions that are in
force at the relevant time would apply. In this view of the matter, if the
parties have agreed that at the relevant time provisions of law as existing
at that time would apply, there cannot be any objection to that. Thus
construing the clause 25, in Rani Constructions (CA 61/99) new Act will
apply.
c

Foreign Awards Act gives the party right to enforce the foreign
award under that Act. But before that right is exercised Foreign Awards
Act has been repealed. It cannot, therefore, be said that any right had
accrued to the party for him to claim to enforce the foreign award under D
the Foreign Awards Act. After the repeal of the Foreign Awards Act a
foreign award can now be enforced under the new Act on the basis of the
provisions contained in Part II of the new Act depending whether it is a
New York Convention Award or Geneva Convention Award. It is irrespec-
tive of the fact when the arbitral proceedings commenced in a foreign
jurisdiction. Since no right has accrued Section 6 of the General Clauses
E
Act would not apply.

. In the very natural of the provisions of Foreign Awards Act it is not
possible to agree to the submissions that Section 85(2)(a) of the new Act
would keep that Act alive for the purpose of enforcement of a foreign F
award given after the date of commencell(ent of the new Act though
arbitral proceedings in foreign land had commenced prior to that. It is
correct that Section 85(2)(a) uses the words "the said enactments" which
would include all the three Acts, i.e., the old Act, Foreign Awards Act and
the Arbitration (Protocol and Convention) Act, 1937. Foreign Awards Act G
and even the 1937 Act contain provisions only for the enforcement of the
foreign award and not for the arbitral proceedings. Arbitral proceedings
and enforcement of the award are two separate stages in the whole process
of arbitration. When the Foreign Awards Act does not contain any
provision for arbitral proceedings it is difficult to agree to the argument
that in spite of that the applicability of the Foreign Awards Act is saved H
516 SUPREME COURT REPORTS [1999] SUPP. 3 S.C.R.

A by virtue of Section 85(2)(a). As a matter of fact if we examine the
provisions of Foreign Awards Act and the new Act there is not much
difference for the enforcement of the foreign award. Under the Foreign
Awards Act when the court is satisfied that the foreign award is enforce-
able under that Act the court shall order the award to be filed and shall
proceed to pronounce judgment accordingly and upon the judgment so
B pronounced a decree shall follow. Sections 7 and 8 of the Foreign Awards
Act respectively prescribe the conditions for enforcement of a foreign
award and the evidence to be produced by the party applying for its
enforcement. Definition of foreign award is same in both the enactments.
Sections 48 and 47 of the new Act correspond to Sections 7 and 8
C respectively of the Foreign Awards Act. While Section 49 of the new Act
states that where the court is satisfied that the foreign award is enforceable
under this Chapter (Chapter I, Part II, relating to New York Convention
Awards) the award is deemed to be decree of that court. The only
difference, therefore, appears to be that while under the Foreign Awards
Act a decree follows, under the new Act foreign award is already stamped
D as the decree. Thus if provisions of the Foreign Awards Act and the new
Act relating to enforcement of the foreign award are juxtaposed there
would appear to be hardly any difference.

Again a bare reading of the Foreign Awards Act and the Arbitration
(Protocol and Convention) Act, 1937 would show that these two enact-
E ments are concerned only with recognition and enforcement of the foreign
awards and do not contain provisions for the conduct of arbitral proceed-
ings which would, of necessity, have taken place in a foreign country. The
provisions of Section 85(2)(a) in so far these apply to the Foreign Awards
Act and .1937 Act, would appear to be quite superfluous. Literal interpreta-
F tion would render Section 85(2)(a) unworkable. Section 85(2)(a) provides
for a dividing line dependent on "commencement of arbitral proceedings"
which expression would necessarily refer to Section 2110 of the new Act.
This Court has relied on this Section as to when arbitral proceedings
commence in the case of Shetty's Construction Co. P. Ltd. v. Konkan
Railway Construction, [1998] 5 SCC 599. Section 2(2) 11 read with Section
G 2(7) 12 and Section 21 falling in Part-I of the new Act make it clear that
10. 21. Commencement of arbitra/ proceedings. - Unless otherwise agreed by the parties,
the arbitral proceedings in respect of a particular dispute commence on the date on
which a request for that dispute to be referred to arbitration is received by the
respondent."
11. "2(2) This Part shall apply where the place of arbitration is in India."
H 12. "2(7) An arbitral award made under this Part shall be considered as a domestic award."
THYSSEN STAHLUNION GMBH v. STEEL AUTHORITY OF INDIA [D.P. WADHWA,J.] 517

these provisions would apply wh.en the place of arbitration is in India, i.e:, A
only in domestic proceedings. There is no corresponding provision
anywhere in the new Act with reference to foreign arbitral proceedings to
hold as to what is to be treated as "date of commencement" in those
foreign proceedings. We would, therefore, hold that on proper construc-
tion of Section 85(2)(a) the provision of this sub- section must be confined
to the old Act only. Once having held so it could be said that Section 6 of B
the General Clauses Act would come into play and foreign award would
be enforced under the Foreign Awards Act. But then it is quite apparent
that a different intention does appear that there is no right that could be
said to have been acquired by a party when arbitral proceedings are held
in a place resulting in a foreign award to have that award enforced under ·c
the Foreign Awards Act.

We, therefore, hold that the award given on September 24, 1997 in
the case of Thyssen Stahlunion GMBH v. St(!el Authority of India Ltd., (Civil
Appeal No. 6036 of 1998) when the arbitral proceedings commenced
before the Arbitration and Conciliation Act, 1996 came into force on 22nd D
August 1996, would be enforced under the provisions of Arbitration Act,
1940. We also hold that clause 25 containing the arbitration agreement in
the case of M/s. Rani Constrnctions Pvt. Ltd. v. Himachal Pradesh State
Electricity Board, Civil Appeal No. 61 of 1999 does admit of interpretation
that the case is governed by the provisions of the Arbitration and Concilia-
tion Act, 1996. We further hold that the foreign award given in the case of E
Western Shipbreaking Corporation v. M/s. Clareheaven Ltd., (Civil Appeal
No. 4928 of 1997) would be governed by the provisions of the. Arbitration
and Conciliation Act, 1996. Thus we affirm the decisions of the Delhi High
Court in Execution Petition No. 47 of 1998 and of the Gujarat High Court
in Civil Revision Application No. 99 of 1997, and set aside that of F
Himachal Pradesh High Court in Civil Suit No. 52 of 1996.

Accordingly Civil Appeal Nos. 6036 of 1998 and 4928 of 1997 are
dismissed, while Civil Appeal No. 61 of 1999 is allowed. Parties shall bear
their own costs.
G
M.P. C.A. No. 6036/98 and C.A. No. 4928/97 dismissed.
C.A. No. 61/99 allowed.