{"id":21514,"date":"1983-10-25T00:00:00","date_gmt":"1983-10-24T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983"},"modified":"2016-04-13T21:49:31","modified_gmt":"2016-04-13T16:19:31","slug":"forasol-vs-oil-natural-gas-commission-and-on-25-october-1983","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983","title":{"rendered":"Forasol vs Oil & Natural Gas Commission (And … on 25 October, 1983"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Forasol vs Oil & Natural Gas Commission (And … on 25 October, 1983<\/div>\n
Equivalent citations: 1984 AIR 241, \t\t 1984 SCR (1) 526<\/div>\n
Author: D Madon<\/div>\n
Bench: Madon, D.P.<\/div>\n
           PETITIONER:\nFORASOL\n\n\tVs.\n\nRESPONDENT:\nOIL & NATURAL GAS COMMISSION (AND VICE VERSA)\n\nDATE OF JUDGMENT25\/10\/1983\n\nBENCH:\nMADON, D.P.\nBENCH:\nMADON, D.P.\nMUKHARJI, SABYASACHI (J)\n\nCITATION:\n 1984 AIR  241\t\t  1984 SCR  (1) 526\n 1983 SCALE  (2)1110\n CITATOR INFO :\n RF\t    1986 SC 137\t (63)\n RF\t    1991 SC 351\t (3)\n\n\nACT:\n     Code  of  Civil  Procedure,  1908-s.  47-Decree  passed\naccording to  award in\tforeign currency without fixing rate\nof exchange-In\texecution proceedings  court must decide and\nselect proper  date for fixing rate of exchange-Criteria for\nselection of date-Date which puts plaintiff in same position\nin which he would have been had the defendant discharged his\nobligation when\t he ought  to have  done. Proper date is the\ndate of decree.\n     Arbitration Act,  1940-s. 17-Judgment  according to the\naward-When it is. Provisions of s. 17 are different from the\nprovisions of s. 26 (1) of the English Arbitration Act.\n     Precedents-English decisions  not binding but have high\npursuasive value.\n     Practice & procedure-General practice & procedure to be\nfollowed  by   plaintiff  while\t  claiming  sum\t in  foreign\ncurrency, arbitrator  while making the award and court while\npassing decree-Laid down.\n\n\n\nHEADNOTE:\n     Forasol, a\t French Company\t having its principal office\nin Paris,  France, entered  into a  contract on February 17,\n1964  with   Oil  and\tNatural\t Gas  Commission  (ONGC),  a\nGovernment of India undertaking, for carrying out structural\ndrilling in  relation to  the exploration  for oil in India.\nArticle IX-3  of  the  contract\t provided  that\t the  amount\npayable to  Forasol on\taccount of  operational fee, standby\nfee, and  equipment charges  shall  be\tcomputed  in  French\nFrancs and  ONGC shall\tpay 80%\t of that  amount  in  French\nFrancs in  Paris, France,  and the  remaining 20%  in Indian\nrupees using a fixed conversion rate of FF. 1.033=Re. 1.000.\nArt  IX-3.2  provided  that  certain  other  charges,  e.g.,\ninsurance, freight,  etc., incurred  by Forasol\t were to  be\nreimbursed to  Forasol by  ONGC\t in  Indian  rupees  if\t the\nexpenditure was\t initially incurred  by\t Forasol  in  Indian\nrupees, otherwise in French Francs. Article X-2, X-3 and X-4\nof the contract set out estimates of the payments to be made\nto Forasol  in French  Francs, the  invoicing rules  and the\nrate of\t payment. Under\t Art. X-3.3, Forasol was to indicate\nin each\t of its invoices, the amount payable to it in French\nFrancs and  the amount\tpayable to it in Indian rupees under\nthe contract.  Art. XI\tprovided for  payments to be made to\nForasol in  Indian rupees.  The contract which was initially\nfor a  period of  one year  was extended  twice and Addendum\nNos. 1,\t 2 &  3 were  added  to\t the  Contract.\t During\t the\nextended  period  of  the  contract  the  Indian  rupee\t was\ndevalued in  June 1966 and consequently Forasol made a claim\nfor conversion of Indian rupees into French\n527\nFrancs at  a rate higher than the rate specified in Art. IX-\n3. The\tdisputes and  differences which\t arose\tbetween\t the\nparties were  referred to  arbitration. The  Umpire who made\nthe award  directed certain  payments to  be made  in French\nFrancs, but  did not  specify the  rate of exchange at which\nthe French  Francs were\t to be converted into Indian rupees.\nThe award  further directed that from November 30, 1966, the\nrupee portion  should be converted at the higher rate of FF.\n1,000 equal  to rupees\t1,517.80. The award was filed in the\nDelhi High Court and the High Court passed a decree in terms\nof  the\t award\tsimpliciter  without  fixing  any  date\t for\nconversion of  the French  Francs into\tIndian rupees,\twith\ninterest at  the rate  of 6%  per annum from the date of the\ndecree till  the date  of payment  Neither party  raised any\nobjection to the said award or to the form in which the said\ndecree was  passed. Forasol filed an application in the High\nCourt for  execution of\t the decree. ONGC contended that the\nenhanced  rate\tof  exchange  specified\t in  the  award\t was\napplicable only\t with respect  to the  interest\t payable  to\nForasol from  November 30,  1966 and that to the rest of the\npayments to  be made under the award either in French Francs\nor in  Indian rupee,  the  contract  rate  of  exchange\t was\napplicable. A  single Judge  of the High Court held that the\ncontract rate  of exchange applied only to the rupee part of\nthe payment  in respect\t of the\t items specified  in Art. IX\n.3.1 and that in respect of the other payments to be made to\nForasol in  French Francs the rate of exchange prevailing at\nthe date  of the  decree would\tapply. In appeal, a Division\nBench of  the High  Court held\tthat the  enhanced  rate  of\nexchange specified in the award applied only to the interest\npayable to Forasol and that with respect to the rupee amount\nthe contract  rate of exchange applied. It further held that\nas the\taward was  in  French  Francs,\tby  reasons  of\t the\nprovisions of  the Foreign  Exchange Regulation\t Act,  1973,\nbefore executing  the award  the French Francs would have to\nbe converted  into Indian  rupees at  the rate\tof  exchange\nprevailing on  the date of the said award. This judgment and\norder of  the Division\tBench was  challenged in these cross\nappeals. The  questions which  arose for consideration were:\n(1) Whether the rate of conversion mentioned in the contract\napplied to  all the  payments to  be made under the contract\nwhether in  Indian rupees or in French Francs, or only to 20\nper cent  of the amount in French Francs, payable by ONGC to\nForasol in Indian rupees in respect of Forasol's operational\nfee, standby  fee and  equipment charges;  (2)\twhether\t the\nenhanced  rate\tof  exchange  specified\t in  the  award\t was\napplicable to  all the\tpayments in Indian rupees under Art.\nIX-3.1 of the contract to be made by ONGC to Forasol or only\nto the\tinterest on  the amount\t in French Francs payable to\nForasol by  ONGC; and  (3) which  was the  proper date to be\nselected for converting into Indian rupees the French Francs\npart of\t the award  in respect\tof which no rate of exchange\nhad been  fixed either by the contract or by the award ? Two\nfurther\t questions   which  were  inextricably\tlinked\twith\nquestion No.  (3) above\t were: (1)  whether an arbitrator or\numpire can  make an  award in  a foreign  currency; and\t (2)\nwhether a  court can  simpliciter pass\ta decree in terms of\nsuch an\t award without\tspecifying the\trate of\t exchange at\nwhich the  foreign currency amount will have to be converted\ninto Indian rupees.\n     Allowing the  appeal of  Forasol and dismissing that of\nONGC,\n528\n^\n     HELD: 1.  Under Art. IX-3.1 of the contract Forasol had\nagreed to accept 20 per cent of its operational fee, standby\nfee and\t equipment charges  in Indian rupees but wanted that\nthe remaining  80 per cent of these fees and charges as also\nthe other  amounts  which  were\t payable  to  it  under\t the\ncontract should\t be paid  to it\t in French  Francs only.  If\nForasol were  to indicate  separately in  its  invoices\t the\npayment to  be made  to it  in French  Francs and  in Indian\nrupees and  if the  payment of such Francs was to be made in\nParis, France,\tin French  Francs, the question of providing\nfor a  rate of\texchange in the said contract for converting\nFrench\tFrancs\t into  Indian\trupees\tcannot\tarise.\tSuch\nconversion rate\t could only  be in  respect  of\t the  amount\npayable to  Forasol in Indian rupees. It is thus only the 20\nper cent  of the said fees and charges computed in French in\nForasol's invoices but payable in Indian rupees which was to\nbe converted  at the  rate  of\texchange  specified  in\t the\ncontract. This\tinterpretation receives further support from\nArt. 2.2  of Addendum  No. 2  and Art. 2.5 of Addendum No. 3\nunder which amounts refundable by Forasol to ONGC were to be\nrefunded in  the same  currency in  which ONGC had paid them\nearlier. [544 C-F]\n     2. The Division Bench of the High Court was in error in\nholding that  the enhanced rate of exchange specified in the\naward applied  only to\tthe amount  of interest\t payable  to\nForasol. The  enhanced\trate  of  exchange  applied  to\t the\npayments in  Indian rupees under Art. IX-3.1 of the contract\nto be  made by\tONGC to\t Forasol from and after November 30,\n1966. [548 D-E]\n     3. In  an action  to recover  an amount  payable  in  a\nforeign currency,  five dates  compete for  selection by the\nCourt as  the proper date for fixing the rate of exchange at\nwhich the  foreign currency  amount has to be converted into\nthe currency  of the  country in  which the  action has been\ncommenced and decided. These dates are:\n     (1) the date when the amount became due and payable;\n     (2) the date of commencement of the action;\n     (3) the date of the decree;\n     (4) the  date when the court orders execution to issue;\nand\n     (5) the  date when\t the  decretal\tamount\tis  paid  or\nrealized.\n     In a  case where  a decree had been passed by the court\nin terms of an award made in a foreign currency a sixth date\nalso enters  the competition, namely, the date of the award.\n[548G-549B]\n     The question which one out of the dates mentioned above\nis the\tproper date  to be  selected by\t the Court  does not\nappear to  have been  decided in this country. The question,\nhowever, has  formed  the  subject-matter  of  decisions  in\nEngland. The  English decisions\t are of\t Courts of a country\nfrom which  we have  derived our  jurisprudence and  a large\npart of\t our laws  and in which the judgments were delivered\nby judges held in high repute. Undoubtedly, none\n529\nof these  decisions are binding upon this Court but they are\nauthorities  of\t high  pursuasive  value  to  which  we\t may\nlegitimately turn for assistance. Whether the rule laid down\nin any\tof these  cases can  be applied\t by our Courts must,\nhowever, be  judged in the context of our own laws and legal\nprocedure and  the practical  realities of litigation in our\ncountry. [549G; 568G]\n     Miliangos v.  George Frank (Textiles) Ltd., L.R. [1976]\nA.C. 443; Tomkinson and Anr. v. First Pennsylvania Banking &\nTrust Co., L.R [1961] A C. 1007; [1960] 2 All E.R. 332; Sub-\nnom in\tre United  Railways of\tHavana and  Regla Warehouses\nLtd.,  L.R.   [1960]  Ch.   52;\t [1959]\t  1  All  E.R.\t214;\nJugoslavenska Oceanska\tPlovibda v.  Castle  Investment\t Co.\nInc., [1973]  3 All E.R. 498' Beswick v Beswick, L.R. [1968]\nA.C 58;\t [1967] 2 All E.R. 1197; Dr. Mann, The\tlegal Aspect\nof Money,  3rd Edn.  [1971], p. 363; Schorsch Meier G.m.b H.\nv. Hennin,  [1975] 1 All E.R. 152; Miliangos v. George Frank\n(Textiles) Ltd.,  [1975] 1 All E.R. 1076; Practice Statement\n(Judicial Precedent),  (1966) 1\t W.L.R 1234;  Owners of M.V.\nEleftherotria v.  The owners of M.V. Despina R-The Dispina R\nand Services  Europe  Atlantique  Sud  (Seas)  of  Paris  v.\nStockholms. Redriaktiebolag  Svea of  Stockholm, L.R. [1979]\nA.C. 685;  Practice directions, [1976] 1 W.L.R. 83; [1976] 1\nAll E.R. 669; The Zafuo, John Carllom & Co. Ltd v. Owners of\nS.S. Zafiro,  L.R. (1960)  p. 1 at 14; [1959] 2 All F.R. 537\nat 544;\t E.D. &\t F. Man\t v. Socite Annonyme Tripolitiane Das\nUsines De Raffinage De Sucre, [1970] 2 Lyod's L.Rep. 416 and\nRussel on Arbitration 20th edn. page 375, referred to.\n     4. When a foreigner has to receive a sum of money which\nshould justly  be payable  to him  in a foreign currency and\nbecause of the default of the paying party, seeks to recover\nits payment  through the  court, the  first  question  which\narises is  whether a  court in India would have jurisdiction\nto pass\t a decree for a sum expressed in a foreign currency.\nThough on  principle there  is no  reason why a court should\nnot be able to do so, no court can pass a decree directing a\ndefendant to  do an impossible or an illegal act and in view\nof the\tprovisions of  our Foreign  Exchange Regulation Act,\n1973, and  the\trestrictions  contained\t therein  on  making\npayments in  a foreign\tcurrency, if  a decree\twere  to  be\npassed\tsimpliciter   for  a  sum  expressed  in  a  foreign\ncurrency, it  would be\tto direct the defendant to do an act\nwhich  would   be  in  violation  of  the  Foreign  Exchange\nRegulation Act,\t 1973. Such a decree can, therefore, only be\npassed by  making the payment in foreign currency subject to\nthe permission\tof the\tforeign exchange  authorities  being\ngranted.  If,\thowever,  the\tauthorities  do\t  not  grant\npermission for\tpayment of  the\t judgment  debt\t in  foreign\ncurrency, it would not be possible for the defendant to make\nsuch payment,  resulting in  the decree\t becoming infrutuous\nand the\t plaintiff getting nothing under it. The court must,\ntherefore,  provide  for  the  eventuality  of\tthe  foreign\nexchange authorities  not granting  the requisite permission\nor even\t if such  permission is\t given,\t the  defendant\t not\npaying the  decretal debt,  or not  wanting to discharge the\ndecree by  making payment  in foreign  currency or in Indian\nrupees. This can only be done by the decree providing in the\nalternative for\t payment of a sum of money in Indian rupees,\nwhich will  be equivalent  to the  sum\tdecreed\t in  foreign\ncurrency. It  is but just that a man, who is in law entitled\nto receive  a sum  of money  in a  foreign currency,  should\neither receive\tit in  such currency  or should\t receive its\nequivalent in Indian rupees. It is here that the question\n530\nof the\tdate which  the court  should select  for converting\nforeign currency  into Indian  rupees arise.  The court must\nselect a  date which puts the plaintiff in the same position\nin which he would have been had the defendant discharged his\nobligation when\t he ought to have done, bearing in mind that\nthe  rate   of\texchange   is  not  a  constant\t factor\t but\nfluctuates, and\t very often  violently fluctuates, from time\nto time.\n     The date  when the\t amount became due and payable, does\nnot have  the effect  of putting  the plaintiff\t in the same\nposition in  which he  would have  been\t had  the  defendant\ndischarged his\tobligation when\t he should have done because\nbetween that  date and the date when the suit is decreed the\nrate of\t exchange may  have fluctuated\tto the\tplaintiff  s\nprejudice,  resulting\tin  the\t amount\t decreed  in  rupees\nrepresenting only  a fraction  of what\the was\tentitled  to\nreceive. Equally,  the possibility  of the plaintiff getting\nmore than  what he  had bargained  for in  case the  rate of\nexchange had  fluctuated in  his favour cannot be ruled out.\nTo select the date when the amount became due or the \"breach\ndate\", as  the English\tcourts have  termed it,\t is thus  to\nexpose the  parties to\tthe  unforesecable  changes  in\t the\ninternational monetary\tmarket. The selection of the \"breach\ndate\" cannot,  therefore,  be  said  to\t be  just,  fair  or\nequitable. [568H 569D]\n     The date  of the commencement of the action or suit, is\nequally subject\t to the same criticism. The selection of the\ndate of\t the filing  of the suit would, therefore, leave the\nparties in  as uncertain  and precarious  a position  as the\nselection of  the date when the amount became payable or the\n\"breach date\". [569 E-H]\n     To select the date of the decree as the conversion date\nwould be  to adopt  as unrealistic a standard as the \"breach\ndate\" because a money decree and the payment by the judgment\ndebtor\tof  the\t judgment  debt\t under\tit  are\t two  vastly\ndifferent matters  widely separated  by successive execution\napplications and  objections  thereto  unless  the  judgment\ndebtor chooses to pay up the judgment debt of his own accord\nwhich is  generally not\t the case.  In the  vast majority of\ncases  a   money  decree  is  required\tto  be\tenforced  by\nexecution. [570 A-E]\n     The  selection  of\t the  date  when  the  court  orders\nexecution to  issue is equally beset with difficulties. [570\nG]\n     In selecting  the date of payment as the proper date of\nconversion  there   are\t three\t practical  and\t  procedural\ndifficulties, namely,  payment of  court fees, the pecuniary\nlimit of the jurisdiction of courts and execution. [572 B-E]\n     This then\tleaves the  court with only three dates from\nwhich to  make the  selection, namely,\tthe  date  when\t the\namount became  payable, the  date of  the filing of the suit\nand the\t date of  the judgment, that is, the date of passing\nthe decree.  It would  be fairer to both the parties for the\ncourt to take the latest of these dates, namely, the date of\npassing the  decree, that is, the date of the judgment. [575\nF]\n531\n     5. Under  section 17  of the  Arbitration Act, 1949 the\njudgment which\tthe court  pronounces is to be \"according to\nthe award\".  Where the\taward directs a certain sum of money\nto be  paid and\t the court,  in a  case\t where\tit  has\t not\nmodified or corrected the award under section 15, pronounces\njudgment for a different sum, the judgment cannot be said to\nbe \"according to the award\". In the same way, where an award\ndirects payment\t of a  sum of  money in foreign currency and\nthe court  while pronouncing judgment provides for its rupee\nequivalent at the rate of exchange prevailing on the date of\nthe award,  the\t court\twill  not  be  pronouncing  judgment\n\"according to  the award\"  if in  the meantime\tthe rate  of\nexchange has varied, because at the date of the judgment the\nforeign currency equivalent of the amount in rupees provided\nin the judgment would be different from the foreign currency\nsum  directed  to  be  paid  by\t the  award.  The  judgment,\ntherefore, can\tonly be\t said to be \"according to the award\"\nif it directs payment of the rupee equivalent at the rate of\nexchange prevailing  on the date of pronouncing the judgment\nwhich date  is the  same as  the date  of the passing of the\ndecree. [584G-585B]\n     6. The  Division Bench  of the High Court has committed\nan error  in equating  s. 26  (1) of the English Arbitration\nAct with  s. 17\t of our Arbitration Act. The reason for this\nerror is  that the Division Bench has proceeded upon a wrong\nassumption  that   the\tprocedural  scheme  of\tthe  English\nArbitration Act\t is the same as that of our Arbitration Act.\nThe provisions\tfor enforcing an award under the English Act\nand under  our Act are different. Granting leave under s. 26\nof the English Act and pronouncing judgment according to the\naward and  passing a  decree under  s. 17  of our  Act\tmean\ndifferent things  and have  different  results.\t A  judgment\naccording to the award under s 17 of our Act will speak only\nfrom the  date of  the judgment\t which will  not be the case\nunder s.  26 (1)  of the English Act, for while in the first\ncase what  will be  enforceable by  the\t processes  by\tlaw,\nnamely execution,  will be the decree passed in terms of the\naward, in  the second  case it\twill be\t the  award  itself,\nunless the  applicant desires  to have\tjudgment entered  in\nterms of the award. [585C, 585E]\n     Satish Kumar  and ors.  v.\t Surinder  Kumar  and  ors.<\/a>,\n[1969] 2 S.C.R. 244, distinguished.\n     7. The practice, which ought to be followed in suits in\nwhich a\t sum of\t money expressed  in a\tforeign currency can\nlegitimately be\t claimed by the plaintiff and decreed by the\ncourt is  as follows. In such a suit, the plaintiff, who has\nnot received  the amount  due to  him in  a foreign currency\nand, therefore,\t desires to seek the assistance of the court\nto recover  that amount, has two courses open to him. He can\neither claim  the amount due to him in Indian currency or in\nthe foreign  currency in which it was payable. If he chooses\nthe first  alternative, he  can only  sue for that amount as\nconverted into\tIndian rupees  and his\tprayer in the plaint\ncan only  be for a sum in Indian currency. For this purpose,\nthe plaintiff  would have  to convert  the foreign  currency\namount due to him into Indian rupees. He can do so either at\nthe  rate of exchange prevailing on the date when the amount\nbecame payable\tfor he was entitled to receive the amount on\nthat date  or, at  his\toption,\t at  the  rate\tof  exchange\nprevailing on  the date\t of the\t filling of the suit because\nthat is the\n532\ndate on\t which he is seeking the assistance of the court for\nrecovering the\tamount due  to him.  In\t either\t event,\t the\nvaluation of the suit for the purposes of court-fees and the\npecuniary limit of the jurisdiction of the court will be the\namount in Indian currency claimed in the suit. The plaintiff\nmay, however, choose the second course open to him and claim\nin foreign  currency the  amount due to him. In such a suit,\nthe proper  prayer for\tthe plaintiff  to make in his plaint\nwould be  for a\t decree that the defendant do pay to him the\nforeign currency  sum claimed  in the  plaint subject to the\npermission of  the concerned  authorities under\t the Foreign\nExchange Regulation Act, 1973, being granted and that in the\nevent of  the foreign  exchange authorities not granting the\nrequisite permission  or the  defendant not  wanting to make\npayment in  foreign currency even though such permission has\nbeen granted  or the defendant not making payment in foreign\ncurrency or  in Indian\trupees, whether\t such permission has\nbeen granted  or not,  the defendant do pay to the plaintiff\nthe rupee  equivalent of the foreign currency sum claimed at\nthe rate of exchange prevailing on the date of the judgment.\nFor  the   purposes  of\t  court-fees  and  jurisdiction\t the\nplaintiff should,  however, value  his claim  in the suit by\nconverting the\tforeign currency  sum claimed  by  him\tinto\nIndian rupees at the rate of exchange prevailing on the date\nof the filing of the suit or the date nearest or most nearly\npreceding such date, stating in his plaint what such rate of\nexchange is.  He should\t further give  an undertaking in the\nplaint that  he would make good the deficiency in the court-\nfees, if any, if at the date of the judgment, at the rate of\nexchange  then\tprevailing,  the  rupee\t equivalent  of\t the\nforeign currency  sum decreed  is higher than that mentioned\nin  the\t  plaint  for\tthe  purposes\tof  court-fees\t and\njurisdiction. At  the hearing of such a suit, before passing\nthe decree,  the court\tshould call  upon the  plaintiff  to\nprove the  rate of  exchange prevailing\t on the\t date of the\njudgment or on the date nearest or most nearly preceding the\ndate  of   the\tjudgment.  If  necessary,  after  delivering\njudgment on  all other\tissues, the court may stand over the\nrest of\t the judgment  and the\tpassing of  the\t decree\t and\nadjourn the  matter to\tenable the  plaintiff to  prove such\nrate of\t exchange. The\tdecree to  be passed  by  the  court\nshould be  one which  orders the  defendant to\tpay  to\t the\nplaintiff the  foreign currency\t sum adjudged  by the  court\nsubject\t to   the  requisite  permission  of  the  concerned\nauthorities under the Foreign Exchange Regulation Act, 1973,\nbeing granted,\tand in\tthe event  of the  Foreign  Exchange\nauthorities not\t granting the  requisite permission  or\t the\ndefendant not  wanting to  make payment\t in foreign currency\neven  though   such  permission\t has  been  granted  or\t the\ndefendant not  making payment  in  foreign  currency  or  in\nIndian rupees,\twhether such  permission has been granted or\nnot, the  equivalent of\t such foreign currency sum converted\ninto Indian rupees at the rate of exchange proved before the\ncourt as  aforesaid.  In  the  event  of  the  decree  being\nchallenged in appeal or other proceedings and such appeal or\nother proceedings  being decided  in whole  or\tin  part  in\nfavour of  the plaintiff,  the appellate  court or the court\nhearing the application in the other proceedings challenging\nthe decree  should follow  the same  procedure as  the trial\ncourt for  the purpose\tof ascertaining the rate of exchange\nprevailing on  the date\t of its\t appellate decree  or of its\norder on  such application  or on  the date  nearest or most\nnearly preceding  the date  of such decree or order. If such\nrate of\t exchange is  different from  the rate in the decree\nwhich  has  been  challenged,  the  court  should  make\t the\nnecessary modification\twith respect to the rate of exchange\nby its appellate decree or final\n533\norder. In  all such  cases, execution can only issue for the\nrupee equivalent  specified in\tthe decree, appellate decree\nor final  order, as  the case  may be.\tThese questions,  of\ncourse,\t would\t not  arise   if  pending  appeal  or  other\nproceedings adopted  by the  defendant the  decree has\tbeen\nexecuted or  the money thereunder received by the plaintiff.\n[587D-589C]\n     8. Just as the courts have power to make a decree for a\nsum of\tmoney expressed in a foreign currency subject to the\nlimitations and conditions set out above, the arbitrators or\numpire have  the power\tto make\t an award for a sum of money\nexpressed in  a foreign\t currency. The arbitrators or umpire\nshould, however,  provide in  the  award  for  the  rate  of\nexchange at  which the\tsum awarded  in a  foreign  currency\nshould be  converted in the events mentioned above. This may\nbe done\t by the arbitrators or umpire taking either the rate\nof exchange  prevailing on the date of the award or the date\nnearest or most nearly preceding the date of the award or by\ndirecting that\tthe rate  of exchange at which conversion is\nto be  made would  be the  date when  the court pronounces a\njudgment according  to the  award and  passes the  decree in\nterms thereof  or the  date nearest or most nearly preceding\nthe date  of the judgment as the court may determine. If the\narbitrators or\tumpire omit  to\t provide  for  the  rate  of\nconversion, this  would\t not  by  itself  be  sufficient  to\ninvalidate the\taward. The  court may either remit the award\nunder section  16 of  the Arbitration  Act,  1940,  for\t the\npurpose of fixing the date of conversion or may do so itself\ntaking the date of conversion as the date of its judgment or\nthe date  nearest or most nearly preceding it, following the\nprocedure outlined  above for  the purpose  of proof  of the\nrate of\t exchange prevailing  on such date. If, however, the\nperson liable under such an award desires to make payment of\nthe sum\t in foreign  currency awarded  by the arbitrators or\numpire without\tthe award being made a rule of the court, he\nwould be  at liberty  to do so after obtaining the requisite\npermission of  the concerned  authorities under\t the Foreign\nExchange Regulation Act, 1973,\n     9, In  the instant\t case the  party entitled to receive\nthe  money-Forasol-was\ta  foreign  party.  Under  the\tsaid\ncontract, the currency of account was a foreign currency and\nso was the currency of payment except for a portion thereof.\nForasol was,  therefore, entitled, on payment not being made\nto it by ONGC, to receive in French Francs the amounts which\nbecame payable\tto it  in that\tcurrency.  The\tUmpire\twas,\ntherefore, justified  in providing  that the amounts payable\nunder the  said award  to Forasol in French Francs should be\npaid in\t French currency.  The Umpire  has, however, neither\nprovided  that\t such  payment\t would\tbe  subject  to\t the\npermission  of\t the  foreign\texchange  authorities  being\nobtained nor  specified the conversion rate to be applied in\nthe eventualities  set out  above. That,  however, does\t not\nmake any  difference because  neither party  has objected to\nthe said award on this ground. On the contrary, both parties\nhave accepted  the said\t award as binding and conclusive, As\nmentioned above,  this omission\t on the\t part of  the Umpire\ncould have  been corrected by the High Court when it came to\npronounce judgment  according to the said award and pass the\nsaid decree  in terms thereof. The decree passed in terms of\nthe said  award, however,  does not specify either the rupee\nequivalent of the amount in French Franch payable to Forasol\nor the\trate of\t exchange at  which the\t conversion of\tsuch\namount into  Indian rupees  should be  made. To that extent,\nthe decree  passed in  terms of\t the said  award by the High\nCourt was not\n534\na proper  decree. Both\tthe parties  have, however, accepted\nthe said decree and have not challenged it on this ground in\nany proceedings.  In any event, the aforesaid mistake in the\nsaid decree  was one  which could have been got corrected by\nan application for review or by an application under section\n152 or, in any event under section 151, of the Code of Civil\nProcedure, 1908. The decree has now become final and binding\nupon the  parties. Both\t the parties  have accepted the said\ndecree and  the said decree cannot, therefore, be said to be\ninvalid on  the ground\tof the\tabove  omission\t to  specify\neither the  rupees equivalent of the French Franc portion of\nthe said  award or the rate of exchange at which such French\nFranc portion was to be converted into its rupee equivalent.\nFor these  reasons we  hold that  the learned  Single  Judge\nrightly\t took  the  date  of  the  decree  as  the  date  of\nconversion. [590C-591B]\n\n\n\nJUDGMENT:\n<\/pre>\n
     CIVIL APPELLATE  JURISDICTION: Civil  Appeal Nos. 628 &
\n629 of 1981.\n<\/p>\n
     Appeals by\t Special Leave\tfrom the  Judgment and Order
\ndated the  21st December,  1979 of  the Delhi  High Court in
\nE.F.A.(O.S.) No. 5 of 1977.\n<\/p>\n
     Shankar Ghosh, and D.N. Gupta, for the Appellant in CA.
\n628\/81 & for Respondent in CA. No. 629\/81.\n<\/p>\n
     B. Dutta  for the\tRespondent in  CA.  628\/81  and\t for
\nappellants in CA. No. 629\/81.\n<\/p>\n
     The Judgment of the Court was delivered by
\n     MADON, J.\tThese cross  appeals by\t special leave arise
\nout of\texecution proceedings  adopted by  Forasol, a French
\nCompany, having\t its  principal\t office\t in  Paris,  France,
\nagainst the Oil and Natural Gas Commission, a statutory body
\nincorporated under  the oil  and Natural Gas Commission Act,
\n1959 (Act  XLIII of  1959),  hereinafter  for  the  sake  of
\nbrevity referred to as ‘ONGC’.\n<\/p>\n
     On July 30, 1962 the Government of India invited global
\ntenders for  structural drilling  for exploration  of oil in
\nthe Jaisalmer  area of the State of Rajasthan. The tender of
\nForasol was  accepted by  the Government  of  India  and  in
\npursuance thereof a contract dated February 17, 1964, headed
\n“Structural Drilling  Contract”, was  entered  into  between
\nONGC and  Forasol. Under  the said  contract,  ONGC  engaged
\nForasol to  carry out structural drilling in relation to the
\nexploration for\t oil in\t the Jaisalmer\tarea of the State of
\nRajasthan on  the terms and conditions contained in the said
\ncontract.\n<\/p>\n
535<\/span><\/p>\n
The said  contract was\tfor a  period of one year commencing
\nfrom the  date of  the start  of the drilling work. The said
\ncontract also gave an option to ONGC to extend the period by
\none more  year. Article IX-3 of the said contract dealt with
\nthe currency of payment. It provided as follows:\n<\/p>\n
\t  “IX-3.1. The\toperational  fee,  standby  fee\t and
\n     equipment\tcharges\t  payable  to\tFORASOL\t have\tbeen
\n     specified in  French Francs in Article IX-1.1.1. to IX-
\n     1.1.1. above.  The amount payable to FORASOL on account
\n     of aforesaid  fees and  charges shall  be\tcomputed  in
\n     French Francs  ONGC shall\tpay  80%  of  the  aforesaid
\n     amount in French Francs and the remaining 20% in Indian
\n     Rupees using  a fixed  conversion rate of FF. 1.033=Re.
\n     1.000.”\n<\/p><\/blockquote>\n
Under Article  IX-3.2 the  cost as  well as  the  insurance,
\npacking, forwarding  and clearing  charges in respect of the
\nmaterials provided  by Forasol\tand the\t freight, insurance,
\npacking, forwarding  and clearing charges for transportation
\nfrom a sea port or air port in France to India and back to a
\nsea port in France or outside France if Forasol so chose, in
\nrespect of  the rig,  equipment, machinery,  tools and other
\nmaterials provided  by Forasol\twere  to  be  reimbursed  to
\nForasol by  ONGC in  Indian rupees,  if the  expenditure was
\ninitially incurred by Forasol in Indian rupees, otherwise in
\nFrench Francs.\n<\/p>\n
     Under  a\tCredit\tAgreement  arrived  at\tbetween\t the
\nGovernment of  India  and  the\tGovernment  of\tFrance,\t the
\nGovernment of France had agreed to provide credit facilities
\nto a  limited extent  to the  Government of  India  for\t the
\nimport of  plant, machinery, equipment and materials and for
\nexecution of  certain projects\tincluding  oil\texploration.
\nUnder the  said Credit\tAgreement, credit was to be given by
\nthe French  suppliers to  the Indian  buyers in\t the form of
\nacceptance of payments on deferred basis upon the conditions
\nlaid down  in the  letters dated February 5, 1962, exchanged
\nbetween the  Governments of  India and France. Consequently,
\nin respect  of the  said contract,  Forasol had agreed under
\nArticle X-1.1  thereof to  accept payment of its fees, costs
\nand charges payable in French Francs on deferred basis under
\nthe overall conditions of the said letters exchanged between
\nthe two Governments and Forasol and ONGC had agreed upon the
\nestimates of  the payments  to be  made to Forasol in French
\nFrancs under  the said contract, the invoicing rules and the
\nmode of payment. Articles X-2, X-3 and X-4 of the
\n536<\/span>
\nsaid contract  set out\tsuch estimates,\t invoicing rules and
\nthe mode  of payment.  Under Article  X-3.3, Forasol  was to
\nindicate in  each of it invoices the amount payable to it in
\nFrench Francs  and the amount payable to it in Indian rupees
\nunder the  said contract.  So far  as the  mode of  deferred
\npayment of  French Francs  was\tconcerned,  Article  X-4.1.1
\nprovided for remittance by ONGC in French Francs immediately
\nfollowing the  signing of  the said  contract of a sum of FF
\n73, 437.49,  being the 19\/800th part (i.e. 1.25 per cent) of
\nthe total  estimated amount  of\t Forasol’s  operational\t and
\nstadby fees  and equipment charges, cost of the materials to
\nbe provided by Forasol and transportation charges in respect
\nof Forasol’s  rig, equipment,  machinery  and  tools.  Under
\nArticle X-4.1.2, subsequent to the above remittance ONGC was
\nto remit  to Forasol  in French\t amount 15\/800th  part (i.e.
\n1.875 per  cent) of the total estimated amount in respect of
\nthe said  items mentioned  above, that\tis FF  110,156.23 on
\neach 5th  day of  August and  February, the  first  of\tsuch
\npayments to  be made  on August\t 5, 1962  and  the  last  on
\nFebruary 5, 1965. Article X-4.2 provided for payment by ONGC
\nto Forasol  of the  balance of\tthe amount  due to  Forasol.
\nUnder Article  X-4.2.1, on  receipt  of\t each  of  Forasol’s
\ninvoices in  respect of\t operational fees,  standby fees and
\nequipment charges  accepted by\tONGC, Forasol was to present
\nto ONGC a set of 14 promissory notes payable to CNEP (Paris)
\nof equal  value totalling  to  87.5%  of  the  French  Franc
\nPortion of  the amount\tfor which  each of the said invoices
\nhad been  accepted by  ONGC and\t maturing on  the 5th day of
\nAugust and of February, the first such dates being August 5,
\n1965 and  the last  being February  5, 1972.  Within fifteen
\ndays of\t the date  of receipt  of the said promissory notes,
\nONGC was  to return  the said  promissory notes\t to  Forasol
\n(Paris) duly signed and stamped.\n<\/p>\n
     Article  X-4.2.2  provided\t for  payment  of  the\tsaid
\npromissory notes. The said Article was as follows:\n<\/p>\n
\t  “X-4.2.2. ONGC  binds itself,\t irrevocably, to pay
\n     in French\tFrancs the  promissory notes  given by it to
\n     Forasol. Forasol  shall present the promissory notes to
\n     CNEP (Paris)  for collecting  payment on  the dates  of
\n     maturity ONGC  shall place\t with CNEP (Paris), at least
\n     one day before each date of maturity, adequate funds to
\n     cover the\ttotal value of the promissory notes maturing
\n     on that date.”<\/p><\/blockquote>\n
537<\/span><\/p>\n
     Under Article X-4.3 ONGC undertook to pay to Forasol in
\nFrench Francs  simple interest at the rate of 5 per cent per
\nannum and also a credit insurance charge at the rate of 1.08
\nper cent  per annum. The other sub-articles of Article X-4.3
\nprovided for  calculation of  interest and insurance charges
\nand for\t submission by\tForasol every six months of invoices
\nin respect  thereof. Article  X-4.3.2, inter  alia, provided
\nthat-\n<\/p>\n
\t  “ONGC shall  accept each  invoice for the interest
\n     and insurance  charge  and\t shall\tremit  the  invoiced
\n     amount to Forasol in French Francs as early as possible
\n     but not  later than  two months  after receipt  of\t the
\n     invoice.”\n<\/p><\/blockquote>\n
Provision was  also made  by the  said Article\tX-4.3.2\t for
\ndrawing of promissory notes payable at CNEP (Paris) maturing
\non each 5th day of August and of February, the first of such
\ndates being  August 5,\t1965 and  the last  being August  5,
\n1971. Under Article X-4.3.3 ONGC bound itself, “irrevocably,
\nto pay\tin French  Francs the  promissory notes for interest
\nand insurance  charge given  by it  to Forasol.”  Article XI
\nprovided for  payments to  be  made  to\t Forasol  in  Indian
\nrupees. Under  Article XI.1.1. the rupee payment part of the
\noperational  and   standby  fees,   equipment  charges\t and
\ntransportation charges\tpayable to  Forasol under  the\tsaid
\ncontract was  estimated to  be FF  1,495,216 and ONGC was to
\npay to Forasol as an advance 10 per cent of the said amount,
\nnamely, FF 149,522, in Indian rupees using a conversion rate
\nof FF  1.033 equal  to Rupee  1.000. The  balance amount  in
\nrespect of  the aforesaid  item was  to be  paid by  ONGC to
\nForasol in Indian rupees using a conversion rate of FF 1.033
\nequal to Rupee 1.000 in the manner set out in the other sub-
\narticles of Article XI.\n<\/p>\n
     On account\t of the\t hostilities  between  Pakistan\t and
\nIndia which  broke out\tin September 1965 the work under the
\nsaid contract  could not  be completed and the operations to
\nbe carried  out there  under had to be suspended. The period
\nof  the\t  said\tcontract   was\tthereupon   extended  by   a
\nsupplementary agreement\t being Addendum No. 1 dated December
\n6, 1965, by a period of six months with effect from the date
\non which  the drilling operations in the Jaisalmer area were
\nresumed at  the expiry\tof  the\t period\t of  suspension.  By
\nanother supplementary  agreement being\tAddendum No. 2 dated
\nJuly 30,  1966, the  period of the said contract was further
\nextended by a period of five months from the moment at which
\nall the equipment of
\n538<\/span>
\nForasol\t then\tunder  repair\tat  Jodhpur  arrived,  after
\ncompletion of  the repairs at the new drill-site, where ONGC
\nmight like  to have  drilling operations to be started under
\nthe said  Addendum No.\t2. Article  2.7 of the said Addendum
\nNo.2 provided as follows:\n<\/p>\n
\t  “2.7. In  case Forasol  has to  refund to  ONGC an
\n     amount  which  cannot  be\tadjusted  or  has  not\tbeen
\n     adjusted against  Forasol’s invoices  for the  last two
\n     months of\tthe five  months period\t of  this  Addendum,
\n     Forasol shall  refund the\tamount in  cash in  the same
\n     currency in which ONGC had paid it earlier.”\n<\/p><\/blockquote>\n
By another  supplementary agreement  being  Addendum  No.  3
\ndated February\t23, 1967,  the period  of the  contract\t was
\nfurther extended  till the  completion of  the\tdrilling  of
\nManhere Tibba  Well No.\t 1 and in case ONGC should decide to
\ntest the  said well till the completion of such test or till
\nApril 18.1967.\twhichever was  earlier. Article\t 2.5 of\t the
\nsaid Addendum No. 3 Provided as follows:\n<\/p>\n
\t  “2.5, In  case Forasol  has to  refund to  ONGC an
\n     amount  which  cannot  be\tadjusted  or  has  not\tbeen
\n     adjusted against  Forasol’s invoices  for the period of
\n     extension stipulated  in  Article\t1.2  above,  Forasol
\n     shall refund the amount in cash in the same currency in
\n     which ONGC had paid it earlier.”\n<\/p><\/blockquote>\n
It may\tbe mentioned  that each\t of the\t said  supplementary
\nagreements provided that all the terms and conditions of the
\noriginal contract  which were not repugnant to the terms and
\nconditions agreed  to for such supplementary agreements were
\nto continue  to apply  until the  termination  of  the\tsaid
\ncontract.\n<\/p>\n
     The extended  period of  the said\tcontract expired  on
\nApril 13, 1967.\n<\/p>\n
     In June  1966, during  the extended  period of the said
\ncontract, the Indian rupee was devalued, and consequently in
\nthe course  of correspondence  which took  place between the
\nparties Forasol made a claim for conversion of Indian rupees
\ninto French  Francs at a rate higher than the rate specified
\nin Article IX. 3 of the said contract.\n<\/p>\n
539<\/span><\/p>\n
     It may  also be mentioned that ONGC paid to the income-
\ntax  authorities   towards  the\t income-tax  liabilities  of
\nForasol three sums aggregating to Rs. 11,95,304 as specified
\nbelow:\n<\/p>\n
\t  (1)  Rs. 1,25,304 on September 14, 1967,
\n\t  (2)  Rs. 4,70,000 on February 14, 1968, and
\n\t  (3)  Rs. 6,00,000 on March 23, 1968.<\/p><\/blockquote>\n
     During the\t period of  extension covered  by  the\tsaid
\nAddendum No.  3 and after the expiry of that period disputes
\nand  differences  arose\t between  the  parties.\t These\twere
\nreferred to  arbitration as  provided in  the said contract.
\nThe parties appointed their respective arbitrators. The time
\nfor making the award was extended from time to time with the
\nconsent of the parties but as Forasol did not consent to any
\nfurther\t extension,   the   disputes   were   referred\t for
\narbitration to\tMr. N.\tRajagopala Iyyangar, a retired judge
\nof  this   Court,  being   the\tUmpire\t appointed  by\t the
\narbitrators. In\t the arbitration  proceedings  Forasol\tmade
\nclaims against\tONGC and  ONGC made  counter-claims  against
\nForasol. On  March 8,  1972, the  Umpire  entered  upon\t the
\nReference and  on December  21, 1974,  the Umpire  made\t his
\naward. To  the said  award an erratum was annexed by which a
\nparticular  portion  to\t the  said  award  was\tdeleted\t and
\nsubstituted by\ta fresh\t portion to  which  we\twill  revert
\nlater. For  the present,  suffice it to say that by the said
\nErratum the  Umpire awarded  that from November 30, 1966 the
\nrupee portion  should be  converted at the rate of FF 1, 000
\nequal to Rs. 1,517. 80 instead of the rate of exchange of FF
\n1,033 equal  to Re. 1,000 provided in Article IX. 3.1 of the
\nsaid contract  and that this enhanced rate of exchange would
\napply to both Forsal and ONGC.\n<\/p>\n
     The said award was filed in the Delhi High Court and on
\nMay 7,1975,  a decree  in terms\t thereof was  passed by that
\nHigh Court with interest at the rate of 6 per cent per annum
\nfrom the  date of the decree till the date of payment of the
\nnet decretal  amount. It  is pertinent\tto note that neither
\nparty raised  any objection to the said award or to the form
\nin which the said decree was passed.\n<\/p>\n
     After the\tsaid decree  was drawn\tup, Forasol filed in
\nMarch 1976  an application  for execution of the said decree
\nbeing Execution No. 77 of 1976. Under the said award certain
\namounts were directed by the Umpire to be paid to Forasol by
\nONGC in French
\n540<\/span>
\nFrancs and certain amounts in Indian rupees, and the amounts
\npayable by  Forasol to\tONGC were to be adjusted and set off
\nagainst the  amounts payable by ONGC to Forasol. In the said
\nexecution application  the rupee credit in favour of Forasol
\nwas converted  into French  Francs at  the rate\t of Rupee 1.
\n5178 equal  to FF  1.000 being the enhanced rate of exchange
\nspecified in  the said\taward. After  deducting the  amounts
\npayable to  ONGC the balance payable to Forasol was shown as
\nFF 5,  89, 727.51  being the  equivalent of  Rs. 11, 79, 455
\nwith interest  on the principal sum upto the date of payment
\nand the\t costs of execution. The mode of execution specified
\nin the said execution application was attachment and sale of
\nthe movable properties belonging to ONGC and specified in an
\nannexure  to   the  said   execution  application.   In\t its
\nobjections to  the said execution application ONGC contended
\nthat the  enhanced rate\t of exchange  specified in  the said
\naward was  only with  respect to  the  interest\t payable  to
\nForasol from  November 30, 1966, and that to the rest of the
\npayments to  be made  under  the  said\taward  the  rate  of
\nexchange mentioned in Article IX-3.1, namely, FF 1.033 equal
\nto Rupee  1.000, was  applicable and that this contract rate
\nof exchange  applied both  to the  French Franc part as also
\nthe Indian rupee part of the said contract. ONGC also raised
\ncertain\t other\t contentions.  On   the\t  basis\t  of   these
\ncontentions, it\t was submitted\tby ONGC\t that instead of any
\namount being due to Forasol a sum of Rs. 6,43,831.44 was due
\nby Forasol  to ONGC.  The learned  Single Judge of the Delhi
\nHigh Court who heard the said execution application rejected
\nall the\t contentions of ONGC. He held that the contract rate
\nof exchange applied only to the rupee part of the payment in
\nrespect of  the items  specified in  Article IX-3.  1 of the
\nsaid contract  and that\t in respect  of such  payments\tfrom
\nNovember 30, 1966, the enhanced rate of exchange provided in
\nthe said  award was  to apply  but in  respect of  the other
\npayments to  be made to Forasol in French Francs the rate of
\nexchange prevailing  at the  date of  the decree, namely, FF
\n1.000 equal  to Rs.  1.938 would  apply. The  learned Single
\nJudge directed\tthat ONGC could satisfy the judgment debt by
\nmaking payment\tin French  Francs or, if it so preferred, by
\npaying the  equivalent of it in Indian rupees at the rate of
\nexchange prevailing  at the  date of  the decree and further
\nordered that  if the decretal amount was not paid within two
\nweeks, attachment  as prayed  for should  issue. Against the
\nsaid judgment  and order  of the  learned Single  Judge ONGC
\nfiled an  intra-court appeal  being E.F.  A. (OS) 5 of 1977.
\nThe Division  Bench of the Delhi High Court, which heard the
\nsaid appeal, upheld the contention of ONGC that the
\n541<\/span>
\nenhanced rate  of  exchange  specified\tin  the\t said  award
\napplied only  to the  interest payable\tto Forasol  and that
\nwith respect  to the  rupee amount due to ONGC and which was
\nto be adjusted against French Francs payable to Forasol, the
\ncontract rate  of exchange  applied. It further held that as
\nthe said  award was  in French\tFrancs,\t by  reason  of\t the
\nprovisions of  the Foreign Exchange Regulation Act, 1973 (46
\nof 1973),  before executing the said award the French Francs
\nwould have to be converted into Indian rupees at the rate of
\nexchange prevailing  on the  date of the said award, namely,
\nFF 1.000  equal to Rupee 1.831. The Division Bench negatived
\nthe other  contentions raised  by ONGC.\t It is\tagainst this
\njudgment and  order of\tthe Division Bench of the Delhi High
\nCourt that the present cross appeals have been filed.\n<\/p>\n
     So far  as Forasol’s  appeal is  concerned, four points
\nwere urged on its behalf before us.\n<\/p>\n
     These points were:\n<\/p>\n
     1.\t  The rate  of exchange specified in Article IX-3. 1
\n\t  of the  said contract,  namely, FF  1.033 equal to
\n\t  Rs. 1.000,  was applicable  only to 20 per cent of
\n\t  the payment to be made in Indian rupees by ONGC to
\n\t  Forasol.\n<\/p>\n
     2.\t  The Umpire  by the  said award  fixed the  rate of
\n\t  exchange at  FF 1.000\t equal to Rs. 1.5178 as from
\n\t  November  30,\t 1966,\tin  respect  of\t such  rupee
\n\t  payments only.\n<\/p>\n
     3.\t  The sum  of Rs.  10,19,380.39, being\tthe  balance
\n\t  amount of  the sum of Rs. 11,95,304 which remained
\n\t  payable to  ONGC by  Forasol\tin  respect  of\t the
\n\t  income-tax paid by ONGC on behalf of Forasol after
\n\t  making adjustments  against the  claim of Forasol,
\n\t  was to be adjusted, as directed by the said award,
\n\t  against Forasol’s  claim in  French Francs  on the
\n\t  respective dates  of each  payment of tax, namely,
\n\t  on September\t14, 1967,  February  14,  1968,\t and
\n\t  March 23,  1968, and\tas all\tthese payments\twere
\n\t  made after  November 30,  1966, and  as under\t the
\n\t  said award  the  enhanced  rate  of  exchange\t was
\n\t  directed to apply to
\n542<\/span>
\n\t  both parties, the said sum of Rs. 10,19,383.39 was
\n\t  to be\t adjusted against  the French Franc claim of
\n\t  Forasol at  the enhanced rate of FF 1.000 equal to
\n\t  Rs. 1.5178.\n<\/p>\n
     4.\t  So far  as the payment to Forasol in French Francs
\n\t  was concerned,  neither the  said contract nor the
\n\t  said\taward  provided\t for  conversion  of  French
\n\t  Francs into  Indian rupees  and  the\tsaid  decree
\n\t  having been  passed in  foreign currency,  in case
\n\t  ONGC did  not or  could not make payment in French
\n\t  Francs, the  rate of\tconversion of French Francs,
\n\t  into Indian  rupees could  only be  at the rate of
\n\t  exchange  prevailing\tat  the\t date  of  the\tsaid
\n\t  decree, that\tis, on\tMay 7,\t1975, which  was  FF
\n\t  1.000 equal to Rs. 1.938.\n<\/p>\n
     ONGC, on  the  other  hand,  submitted  that  the\tsaid
\ncontract provided a fixed rate of exchange of FF 1.033 equal
\nto  Re.\t 1.000\tfor  all  amounts  payable  under  the\tsaid
\ncontract, whether  in  rupees  or  in  French  Francs,\tand,
\ntherefore, that\t rate alone  should be\ttaken as the correct
\nconversion ratio  except with  respect to  interest  on\t the
\namount in  Franch Francs  payable to  Forasol in  respect of
\nwhich the  Umpire had  enhanced the  rate of  exchange to FF
\n1.000 equal  to Rs.  1.5178.  In  the  alternative,  it\t was
\nsubmitted  that\t the  conversion  rate\tshould\tbe  the\t one
\nprevailing at  the date\t of the\t said  award,  that  is,  on
\nDecember 21, 1974, namely, FF 1.000 equal to Rs. 1.831.\n<\/p>\n
     Thus, there  are four different rates of exchange which
\nfeature in this case, namely,-\n<\/p>\n
     Rate provided in the\t   FF 1.033   =\t  Rs. 1.000\n     said contract\n     Rate fixed by the\t\t   FF 1.000   =\t  Rs. 1.5178\n     Umpire\n     Rate at the date of the\t   FF 1.000   =\t  Rs. 1.831\n     said award namely\n     on December 21, 1974\n     Rate at the date of\t   FF 1.000   =\t  Rs. 1.938\n     the decree, namely,\n     on May 7, 1975\n543<\/span>\n<\/pre>\n
     We shall  first examine  the said contract to determine
\nwhether the rate of conversion mentioned in the said Article
\nIX-3.1 applied\tonly to 20 per cent of the amounts in French
\nFrancs payable\tby ONGC\t to  Forasol  in  Indian  rupees  in
\nrespect\t of  Forasol’s\toperational  fee,  standby  fee\t and
\nequipment charges  as contended\t by Forasol  or\t whether  it
\napplied to  all payments to be made under the said contract,
\nwhether in rupees or in French Francs, as contended by ONGC.
\nIn doing  so, a cardinal fact must be borne in mind, namely,
\nthat it\t was a contract entered into between a foreign party
\nand a  Government of  India undertaking\t and that  under the
\nsaid contract  the foreign  party had  agreed to  carry\t out
\nstructural drilling  in relation to the exploration for oil,
\ndiscovery of  oil being\t of vital importance to the national
\ninterests of  India. From  the nature of things, the foreign
\nparty would  not desire\t payment  for  the  services  to  be
\nrendered and  the equipment  to\t be  supplied  by  it  in  a
\ncurrency  with\twhich  it  had\tno  connection\tand  of\t the
\ncontinuous stability  of which\tit could not be certain. The
\nforeign party would, therefore, naturally desire and bargain
\nfor payment  in the  currency of its own country, namely, in
\nFrench currency.  The more so, as under the Credit Agreement
\nentered into  between  the  Government\tof  France  and\t the
\nGovernment of India the Government of France had agreed that
\ncredit should  be given by French suppliers to Indian buyers
\nby accepting  payment on  deferred basis  for the  import of
\nplant, machinery,  equipment and  materials and execution of
\ncertain\t  projects    including\t  oil\t exploration,\tand,
\naccordingly, under  Article X-1.1.  of the said contract the
\nFrench party,  Forasol, had  agreed to\taccept\ton  deferred
\nbasis payment  of the amounts due to it in French Francs. We
\nhave earlier  referred to  the relevant Articles of the said
\ncontract  as  also  extracted  some  of\t them  in  order  to
\nemphasize that\tthough under the said Article IX-3.1 Forasol
\nhad agreed  to accept  20 per  cent of\tits operational fee,
\nstandby fee  and equipment  charges  in\t Indian\t Rupees,  it
\nwanted that  the remaining  80 per  cent of  these fees\t and
\ncharges as  also the  other amounts which were payable to it
\nunder the  said contract  should be  paid to  it  in  French
\nFrancs only  and should\t not  be  made\tdependent  upon\t the
\nstability of  the Indian rupee in the international monetary
\nmarket. To  recapitulate, the  invoicing rules provided that
\nin each\t of its\t invoices Forasol should indicate separately
\nthe amount  payable to\tit in  French Francs  and the amount
\npayable to it in Indian rupees and that so far as the French
\nFranc part  was concerned, an initial payment was to be made
\nimmediately upon  the signing  of the  said contract and the
\nbalance was to be paid by remittances in French Francs. Such
\nremittances were to be made by Forasol presenting
\n544<\/span>
\nto ONGC a set of promissory notes payable in Paris and under
\nArticle X-4  2.2 of the said contract ONGC irrevocably bound
\nitself to pay in French Francs the promissory notes given by
\nit to  Forasol, Similar\t provisions were  made in  the\tsaid
\ncontract for  payment of  interest and\tinsurance charges to
\nForasol. If  Forasol were  to  indicate\t separately  in\t its
\ninvoices the  payment to  be made to it in French Francs and
\nin Indian  rupees and  if the  payment of such French Francs
\nwas to\tbe made\t in Paris  in French Francs, the question of
\nproviding for  a rate  of exchange  in the said contract for
\nconverting French  Francs into\tIndian rupee  cannot  arise.
\nSuch conversion rate could only be in respect of the amounts
\npayable to Forasol in Indian rupees. It is pertinent to note
\nthat under  Article IX-3.1  the amount\tof fees\t and charges
\npayable to  Forasol were to be computed in French Francs and
\nthereafter 80  per cent\t thereof was  to be  paid in  French
\nFrancs and the remaining in Indian rupees. Even with respect
\nto such twenty per cent Forasol did not want to be dependent
\nupon a\tpossible fluctuation  in the  exchange rate of rupee
\nand, therefore,\t the 20 per cent part of the amount computed
\nin French  Francs was  covenanted to be converted at a fixed
\nrate provided  in the  said Article  IX-3.1.  This  is\tmade
\nabundantly clear  by the  express terms\t of the said Article
\nIX-3.1 when  it states\tthat “ONGC  shall  pay\t80%  of\t the
\naforesaid amount  in French  Francs and the remaining 20% in
\nIndian Rupees  using a fixed conversion rate of FF 1.033=Re.
\n1.000.” It is thus only the 20 per cent of the said fees and
\ncharges computed  in French Francs in Forasol’s invoices but
\npayable in  Indian rupees  which was  to be converted at the
\naforesaid rate\tof exchange  specified in the said contract.
\nThis interpretation  receives further  support from  Article
\n2.2 of\tAddendum No.  2 and  Article 2.5  of Addendum  No. 3
\nextracted above under which amounts refundable by Forasol to
\nONGC were  to be refunded in the same currency in which ONGC
\nhad paid them earlier. The contention of ONGC that the fixed
\nrate of conversion provided in Article IX-3.1 applied to all
\npayments to be made under the said contract to Forasol must,
\ntherefore, be rejected.\n<\/p>\n
     What  next\t falls\tto  be\tconsidered  is\twhether\t the
\nenhanced rate  of exchange  specified by  the Umpire  in the
\nsaid award  applied only  to the  amount payable  by way  of
\ninterest to  Forasol as\t contended by  ONGC. This contention
\nwas rejected  by the  learned Single  judge but found favour
\nwith the  Division Bench  of the  Delhi High  Court.  It  is
\nnecessary to  set out  some further facts in order to decide
\nthis point  During the\tcourse of  the\thearing\t before\t the
\nUmpire, ONGC had
\n545<\/span>
\nfiled a\t statement showing  the adjustment  of the amount of
\nFrench Francs  due to  Forasol against the amount of income-
\ntax paid  by ONGC  on behalf  of Forasol.  It was,  however,
\nerroneously assumed  by the  Umpire that  the said statement
\nwas an agreed one. After the Umpire had drafted his award he
\nhanded over  a copy  of it to the parties in order that they
\nmight point  out to him any incorrect statements or mistakes
\nof a clerical or similar nature so that he could correct the
\nsame before  the award\twas made and published. Accordingly,
\nboth the  parties appeared before the Umpire and agreed that
\nthere were  certain errors  in the draft award and requested
\nthe Umpire  to correct\tthese  errors  before  he  made\t and
\nPublished his  award. The  Umpire  thereupon  corrected\t the
\nerrors jointly pointed out to him by appending an Erratum to
\nthe said  award. In  the said Erratum the Umpire pointed out
\nthat the  aforesaid statement  was not\tan agreed one and he
\ndirected that  certain\tportions  of  the  award  should  be
\ndeleted and  substituted by  fresh paragraphs set out in the
\nsaid Erratum.  In the  said Erratum the Umpire first pointed
\nout certain  errors of\tcalculation and in the mentioning of
\nfigures which had been occurred. He then proceeded to state:\n<\/p>\n
\t  “Incidentally\t it   was  pointed   out  that\t the
\n     statement on  pages 145-6\tand in\tthe penultimate\t and
\n     last two  paragraphs on page 149 regarding the document
\n     filed before me, as regards the adjustment of FF claims
\n     due to  Forasol against the income-tax paid by ONGC was
\n     not an   agreed  statement, but a statement prepared by
\n     O.N,  G.C.\t on  their  own\t to  which  Forasl  had\t not
\n     consented,\t As  a\tresult\tof  this,  the\tquestion  of
\n     adjustment of the income-tax paid against FF claims, as
\n     set out  in the  last para on page 149 and in the first
\n     two paragraphs  on page  150 would\t be deleted  and  in
\n     their place  the Award would state that ‘the amounts of
\n     income-tax paid  by ONGC  shall be adjusted against the
\n     FF claims\tdue to\tForasol on the date when each amount
\n     was paid in the manner set out earlier in the Award.’
\n\t  “To achieve  this purpose  the paragraphs on pages
\n     149  and\t150  beginning\t with  the   words  ‘In\t the
\n     calculation of  the interest  on the  several invoices’
\n     and  ending   with\t ‘I  have  already  dealt  with\t the
\n     conversion rate  and there\t is no\tneed to\t go into  it
\n     again’ on page 150 shall be deleted and a new paragraph
\n     inserted, which will read as follows:\n<\/p><\/blockquote>\n
546<\/span><\/p>\n
     X\t\tX\t   X\t\t X\t      X
\n\t  ‘…as a  result the\taggregate figure of interest
\n     payable to\t Forasol by O.N.G.C. upto 30-6-1974 would be
\n     FF 12,91,290,06. From this a small adjustment has to be
\n     made…when these\tare  adjusted  the  amount  due\t for
\n     interest  by   O.N.G.C.  to   Forasol   would   be\t  FF
\n     12.88.185.35.’
\n\t  ‘This\t figure\t  of  FF   12,91,290,06\t  has\tbeen
\n     calculated on  the basis of conversion rate of FF 1.033
\n     to a rupee (or FF 1033 for every Rs. 1,000\/-) which was
\n     the rate  of exchange  agreed to  between thee  parties
\n     under  Article  XI.  1.1.1\t of  the  Agreement.  Messrs
\n     Forasol have put forward before me a claim for enhanced
\n     rate of interest and their claim is that this should be
\n     Rs. 1,5178\t for every  FF or  Rs. 1517,80\tfor every FF
\n     1,000, I find that there is considerable correspondence
\n     in the  course of\twhich they  have made  a claim\tthat
\n     after devaluation of the rupee there should be a change
\n     in the  rate of  exchange, Though\tthere is no specific
\n     letter in\tthe file  agreeing to the enhancement I find
\n     that in the later invoices demand has been made subject
\n     to the  claim for enhanced rate of exchange. In view of
\n     this I  consider that  from  30,11,1966  Rupee  portion
\n     should be Converted at FF 1 = Rs. 1.5178 or FF 100= Rs.
\n     1.517.80. Of  course this\trate of exchange would apply
\n     to both the parties, Farasol and the O.N.G.C.’
\n\t  ‘As stated  earlier this  has been worked out only
\n     upto 30.6.1974  and in  accordance with  the directions
\n     contained in this award interest shall be calculated on
\n     the principal  amount  right  upto\t 21.12.1974  on\t the
\n     entire amount  of\tprincipal  and\tthe  entire  sum  of
\n     principal and  interest would thereafter carry interest
\n     at 6%  per annum, as stated in the other portion of the
\n     award.”<\/p><\/blockquote>\n
\t  (The emphasis has been supplied by us.)
\n     Article XI-1.1  of the said contract referred to in the
\nsaid Erratum provided as follow:-\n<\/p>\n
\t  “XI-1.1.1 On\tthe basis  of the figures arrived at
\n     in Articles  IX-2.1 and  IX-2.2 above and in accordance
\n     with the  condition laid  down in Article IX-3.1 above,
\n     the total
\n547<\/span>
\n     of FORASOL’s  operational and  standby fees,  equipment
\n     charges and  transportation charges  payable in  Indian
\n     Rupees under  this contract,  is  estimated  to  be  FF
\n     1,495, 216,  Following signature of this contract, ONGC
\n     shall pay\tto FORASOL,  as an  advance, 10a\/c  of\tthis
\n     amount  i.e.  FF  149,522\tin  Indian  Rupees  using  a
\n     conversion rate of FF 1.033 = Rs. 1.000.”<\/p><\/blockquote>\n
     In order  to reach\t the conclusion\t which it  did,\t the
\nDivision Bench\tof the\tDelhi High  Court relied  upon\tthat
\nportion of the said Erratum where the Umpire has stated that
\nForasol has  put forward  before him  a claim  for “enhanced
\nrate of\t interest”, overlooking\t the other  portions of\t the
\nsaid Erratum,  particularly the\t portion emphasized by us in
\nthe above  extract as also the fact that by the said Erratum
\ncertain\t portions   of\tthe  said  award  were\tdeleted\t and
\nsubstituted by\tfresh paragraphs.  On a perusal of the above
\nextract from  the said Erratum, it is obvious that the claim
\nmade by Forasol was not for an enhanced rate of interest but
\nfor  an\t  enhanced  rate   of  exchange\t by  reason  of\t the
\ndevaluation of\tthe rupee. This is made clear by the rest of
\nthe very  same sentence\t in the\t said Erratum  in which this
\nclaim made  by Forasol\twas referred  to, namely, “and their
\nclaim is  that this should be Rs. 1.5178 for every FF or Rs.
\n1.5178 for  every FF 1,000,” If the claim of Forasol was for
\nan enhanced rate of interest, the claim would have been that
\ninterest should be payable to it not at the contract rate of
\nfive per  cent per annum but at a higher rate and not that a
\nhigher rate  of exchange  should be  provided. The very next
\nsentence which also we have emphasized clarifies that in the
\ncorrespondence which took place between the parties, Forasol
\nhad made  a claim  that after devaluation of the rupee there
\nshould be  a change in the rate of exchange. Obviously, this
\nchange would be with respect to the rupee payment to be made
\nto Forasol.  The very direction of the Umpire in this behalf
\nmakes it  clear that  he was not dealing only  with the rate
\nof interest  for by  the said  direction, which\t too we have
\nemphasized in  the above  extract, the\tUmpire awarded\tthat
\nfrom November  30, 1966,  “Rupee portion should be converted
\nat FF  1 =  Rs. 1.5178\tor FF  1,000 =\tRs. 1,5178”  and  he
\nfurther awarded\t that “this  rate of exchange would apply to
\nboth the  parties, Forasol and the O.N.G.C.” The question of
\nthe enhanced  rate of  exchange applying to both the parties
\nwould not  arise if  the enhanced  rate of exchange was with
\nrespect only to the interest payable to Forasol.\n<\/p>\n
548<\/span><\/p>\n
     We are  fortified in  the conclusion we have reached by
\nthe fact that so far as the adjustment of claim of ONGC with
\nrespect to  income-tax paid  by it was concerned, the Umpire
\nby the\tsaid Erratum  expressly deleted\t from the said award
\nthe portion  in\t which\tsuch  adjustment  was  made  at\t the
\ncontract rate of FF 1.033 equal to Re. 1,000 and substituted
\nit by fresh paragraphs. Under the said Erratum these amounts
\nwere directed  to be  adjusted from November 30, 1966 at the
\nenhanced rate  of exchange  provided in\t the said Erratum as
\nall these amounts were paid by ONGC after the said date.\n<\/p>\n
     Another fact which fortifies this conclusion is that by
\nthe last  paragraph of\tthe  portion  of  the  said  Erratum
\nextracted  above,   in\taddition  to  an  enhanced  rate  of
\nexchange, the  Umpire has  also awarded\t a  higher  rate  of
\ninterest, namely,  six\tper  cent,  on\tthe  entire  sum  of
\nprincipal and interest from December 22, 1974.\n<\/p>\n
     The Division  Bench of the Delhi High Court was, the in
\nerror  in   holding  that  the\tenhanced  rate\tof  exchange
\nspecified in  the said\taward applied  only to the amount of
\ninterest payable to Forasol. For the reasons stated above we
\nfind that  this enhanced  rate of  exchange applied  to\t the
\npayments in  Indian rupees  under Article IX-3.1 of the said
\ncontract to  be made  by ONGC  to  Forasol  from  and  after
\nNovember 30,1966.\n<\/p>\n
     The question  which now  remains to  be  considered  in
\nForasol’s appeal is the date to be selected by the Court for
\nconverting into\t Indian rupees\tthe French Franc part of the
\nsaid award  in respect of which no rate of exchange has been
\nfixed either by the said contract or the said award.\n<\/p>\n
     In an  action to recover an amount payable in a foreign
\ncurrency, five\tdates compete  for selection by the Court as
\nthe proper date for fixing the rate of exchange at which the
\nforeign\t currency  amount  has\tto  be\tconverted  into\t the
\ncurrency of  the  country  in  which  the  action  has\tbeen
\ncommenced and decided.\n<\/p>\n
     These dates are:\n<\/p>\n
     (1)  the date when the amount become due and payable;
\n     (2)  the date of the commencement of the action;\n<\/p>\n
549<\/span><\/p>\n
     (3)  the date of the decree;\n<\/p>\n
     (4)  the date when the court orders execution to issue;
\n\t  and
\n     (5)   the date  when the  decretal amount\tis  paid  or
\n\t  realized.\n<\/p>\n
     In a  case where  a decree has been passed by the court
\nin terms of an award made in a foreign currency a sixth date
\nalso enters  the competition, namely, the date of the award.
\nThe case before us is one in which a decree in terms of such
\nan award has been passed by the court.\n<\/p>\n
     The said  award directed certain payments to be made in
\na foreign  currency, namely,  French  Francs,  and  did\t not
\nspecify the rate of exchange at which the French Francs were
\nto be  converted into Indian rupees and the decree which was
\npassed by  the Delhi  High Court  was in  terms of  the said
\naward simpliciter  without fixing any date for conversion of
\nthe French  Francs into Indian rupees. As mentioned earlier,
\nneither party  filed any  objection to\tthe said award or to
\nthe passing  of the said decree in the terms in which it was
\npassed. The  question whether  an arbitrator  or umpire\t can
\nmake an\t award in  a foreign  currency\tis,  therefore,\t not
\ndirectly in issue before us nor the question whether a court
\ncan simpliciter\t pass a\t decree in  terms of  such an  award
\nwithout specifying the rate of exchange at which the foreign
\ncurrency amount\t will  have  to\t be  converted\tinto  Indian
\nrupees. Though\tat the\tfirst blush  these questions  do not
\nappear to arise for our determination, they are inextricably
\nlinked with  the question  which we  have to  decide and  we
\nwill, therefore,  have to  address ourselves  to them in due
\ncourse.\n<\/p>\n
     The question which one out of the dates mentioned above
\nis the\tproper date  to be  selected by\t the court  does not
\nappear\tto  have  been\tdecided\t in  this  country,  and  no
\nauthority of any Indian court on this point has been brought
\nto  our\t notice.  The  question,  however,  has\t formed\t the
\nsubject-matter of  decisions in England and both the learned
\nSingle Judge  as also  the Division  Bench of the Delhi High
\nCourt have referred to the decision of the House of Lords in
\nMiliangos v.  George  Frank  (Textiles)\t Ltd.(1)  and  other
\nEnglish\t cases.\t  They\thave   however,\t reached   differing
\nconclusions, the  learned  Single  Judge  holding  that\t the
\nconversion of French Francs into Indian
\n550<\/span>
\nrupees should  be made at the rate of exchange prevailing on
\nthe date  of the  said decree and the Division Bench holding
\nthat such  conversion should  be at  the  rate\tof  exchange
\nprevailing at  the date\t of  the  said\taward.\tIt  will  be
\nconvenient, therefore,\tto turn now to the English decisions
\non the\tpoint to ascertain whether we can find some guidance
\nfrom them  in arriving\tat our conclusion. The judicial view
\non this\t point in England has undergone a radical change and
\nit will\t not be\t out of\t place to ascertain the earlier view
\nwhich the  courts in  England took  and the  view which\t now
\nprevails with  them and\t to take  a brief survey of how this
\nchange in view came about.\n<\/p>\n
     In Tomkinson  and another v. first Pennsylvania Banking
\n& Trust\t Co.(1) (better\t known as the Havana case) on appeal
\nfrom the  decision of  the Court  of Appeal,  sub-nom In  re
\nUnited Railways\t of Havana  and\t Regla\tWarehouses  Ltd.,(2)
\nafter reviewing\t the earlier authorities, the House of Lords
\nheld that  an English court cannot give judgment for payment
\nof an  amount in foreign currency, and that for the purposes
\nof litigation  in England  a debt  expressed  in  a  foreign
\ncurrency must  be converted  into sterling with reference to
\nthe rate  of exchange  prevailing on  the date when the debt
\nwas payable.  Lord Denning,  who was  then a  member of\t the
\nHouse of  Lords, delivered a concurring judgment in which he
\npointed out  that the  origin of this rule was that sterling
\nwas for\t a long\t time regarded\tas a  stable  currency,\t the
\nconstant unit  of value\t by which,  in the  eye of  the law,
\neverything else\t was measured,\tand that so long as sterling
\nwas regarded  as stable\t while other  currencies fluctuated,
\njustice was  best done by taking the rate of exchange at the
\ndate of\t the breach;  the creditor  being entitled to be put
\ninto as\t good a\t position as if the debtor had done his duty
\nand paid  the debt on the due date and the creditor was only
\ntruly put  into such  a position  if the  debt was converted
\ninto sterling  at that\tdate. At  the same time Lord Denning
\nalso posed  a question\twhether the  rule was  still  to  be
\napplied when  sterling had  lost the value which it once had
\nby reason  of the devaluation of the pound. He however, came
\nto the conclusion that though such a rule was apt to produce
\nan injustice to a foreign creditor who was owed money in the
\ncurrency of  his own  country if  he chose to sue in English
\ncourts\tinstead\t of  his  own,\the  must  put  up  with\t the
\nconsequences. The  rule affirmed in the Havana case is known
\nas the “breach date rule”.\n<\/p>\n
551<\/span><\/p>\n
     The next  decision which requires to be noticed is that
\nof the Court of Appeal in Jugoslavenska Oceanska Plovibdo v.
\nCastle Investment  Co. Inc.(1)\tAs this authority was relied
\nupon by\t the Division Bench of the Delhi High Court in order
\nto arrive at its decision on this part of the case and as it
\nformed the  sheet-anchor of the submission made on behalf of
\nONGC that  the proper  date of conversion should be the date
\nof the award, it is necessary to examine what was decided in
\nthis case  in some detail. In that case, the plaintiffs were
\nawarded a  sum expressed  in United  States  dollars  in  an
\narbitration held  in London. The defendants having failed to
\npay the\t sum awarded,  the plaintiffs  sought leave  of\t the
\ncourt under  section 26\t of the\t Arbitration Act,  1950,  of
\nEngland\t to   enforce  the   award.  In\t  support  of  their
\napplication the\t plaintiffs filed  an affidavit\t showing the
\nrate of exchange prevailing at the date of the award and the
\namount of the award in pound sterling and claimed the amount
\ndue under  the award  on the said basis. The questions which
\nfell for  determination were whether an award expressed in a
\ncurrency other than sterling was valid and lawful and, if so
\nwhether it  was enforceable  under the\tsaid section 26. The
\nMaster dismissed  the application and the order of dismissal
\nwas affirmed  by Kerr J. On appeal, the court of Appeal held
\nthat the  award was  valid and\tleave should  be granted  to
\nenforce it, On the question whether English arbitrators have
\njurisdiction to\t make an  award for  payment  in  a  foreign
\ncurrency, the Court held that in a proper case they could do
\nso and\tthat in\t the case  before them\tsince the  money  of
\naccount and the money of payment under the charter party out
\nof  which  the\tdisputes  between  the\tparties\t arose\twere
\nexpressed in  United States  dollars  the  arbitrators\twere
\nentitled to  make their\t award in  the same currency. It was
\nfurther held  that leave  should be  granted to\t enforce  an
\naward expressed in a foreign currency provided the applicant
\nhad  filed   an\t affidavit  showing  the  rate\tof  exchange
\nprevailing at the date of the award and giving the amount of
\nthe award converted into sterling. When that case fell to be
\ndecided Lord  Denning was  a member  of the Court of Appeal,
\nhaving accepted\t appointment as\t Master of the Rolls. In the
\ncourse of  his judgment in that case, Lord Denning M.R. said
\n(at pages 501-2):\n<\/p>\n
\t  “The reason  why some\t people have thought that an
\n     award by  English arbitrators  must be  in sterling  is
\n     because they  have\t regarded  it  as  equivalent  to  a
\n     judgment by an
\n552<\/span>
\n     English judge  which must\tbe in sterling. But there is
\n     this difference. When commercial men are in dispute and
\n     go to  arbitration,  they\twish  to  have\tthe  dispute
\n     resolved. They  want a  decision one  way or the other.
\n     Once given, they abide by it, The losing party pays up.
\n     There is  rarely any need to call in the sheriff or his
\n     officer to\t enforce the award. So it is perfectly fair,
\n     as between\t them, for  the arbitrator to make his award
\n     in the currency which is appropriate to their dealings.
\n     But, when a plaintiff goes to a court of law, it is, as
\n     often as  not, because the defendant cannot pay or will
\n     not pay,  The plaintiff  wants to\tget judgment against
\n     him and,  if need\tbe, levy  execution on\this effects.
\n     This is  so much  in the  mind of\tthe courts that they
\n     have  ruled  that\tthey  will  give  judgment  only  in
\n     sterling. That  is the  one currency  which is known to
\n     the court\tand to\tthe sheriffs  and their\t officers. I
\n     venture to\t suggest that this view of the courts should
\n     be open for reconsideration. If the money payable under
\n     a contract\t is payable  in a foreign currency, it ought
\n     to be  possible for  an English court to order specific
\n     performance of  it in  that foreign  currency; and then
\n     let the exchange be made into sterling when it comes to
\n     be enforced. I know that this is not yet the law. There
\n     is high authority against it: see Re United Railways of
\n     Havana and Regla Workhouses Ltd. But the House of Lords
\n     have since\t then held that specific performance can be,
\n     ordered of\t a contract  to make  a money  payment:\t see
\n     Beswlck v.\t Beswick.(1) This  may point  the way  to  a
\n     relaxation of  the old  rule and  enable the courts, in
\n     proper circumstances,  to order  payment into a foreign
\n     currency, such  as is  suggested by  Dr.  Mann  in\t his
\n     book.(2)
\n\t  At any rate, there is no reason why the rule about
\n     judgments of the courts should be extended to awards by
\n     arbitrators, I  think we  should hold  that arbitrators
\n     have  jurisdiction\t to  make  an  award  in  a  foreign
\n     currency whenever\tthat is the proper currency in which
\n     payments under the contract should be made.\n<\/p><\/blockquote>\n
553<\/span><\/p>\n
\t  “The next question is the manner of enforcing such
\n     an award.\tIt would,  no doubt, be possible to bring an
\n     action on the award and seek a judgment from the courts
\n     in sterling. In that case the rate of exchange would be
\n     taken at  the date\t of the award. But another way is to
\n     seek the  leave  of  the  court  under  s.\t 26  of\t the
\n     Arbitration Act 1950 which says:\n<\/p><\/blockquote>\n
\t  ‘An award  on an  arbitration\t agreement  may,  by
\n     leave of the High Court or a judge thereof, be enforced
\n     in the  same manner  as a judgment or order to the same
\n     effect, and  where leave  is so  given, judgment may be
\n     entered in terms of the award.\n<\/p><\/blockquote>\n
\t  “If the  words ‘to  the same\teffect’ are  read as
\n     meaning ‘in  the  same  terms’,  there  would  be\tsome
\n     difficulty in  applying this  section to  an award in a
\n     foreign currency,\tBut I do not think they mean ‘in the
\n     same terms\t They only  mean that  the judgment or order
\n     must have\t‘the same  effect’. If\tthe sum\t awarded  is
\n     converted into  sterling at the rate of exchange at the
\n     date of  the award,  it does  have the same effect. The
\n     proper course is for the applicant to file an affidavit
\n     showing the  rate of  exchange at the date of the award
\n     and giving\t also the amount of the award converted into
\n     sterling. Then  leave will\t be given to enforce payment
\n     of that sum,”<\/p><\/blockquote>\n
     (The emphasis has been supplied by us.)
\nIt may\tbe mentioned  that the\tdefendants did not appear at
\nany stage  of the  proceedings and  were not represented and
\nthere was  no  appeal  to  the\tHouse  of  Lords  from\tthis
\njudgment.\n<\/p>\n
     Whether  we   should  accept   the\t decision   in\t the
\nJugoslavenska case  as laying  down the\t correct rule  to be
\napplied so  far as courts in this country are concerned is a
\nmatter which  we will discuss after completing our survey of
\nEnglish authorities.\n<\/p>\n
     The question  again arose before the Court of Appeal in
\nSchorsch Meier G.m.b.H. v. Hennin. That was not a case of an
\narbitration but it was an action by a German company against
\nan
\n554<\/span>
\nEnglish firm  in an  English court for the price of goods in
\nGerman\tdeutschmarks   in  which   currency   the   contract
\nstipulated that\t payment of  the price\tshould be  made. The
\naction was  commenced by  the plaintiffs  in the West London
\nCounty Court  for the sum of DM 3,756.03 being the amount of
\nthe price  of goods  sold and delivered. Under the contract,
\nthe money  of account  and the\tmoney of  payment were\tboth
\nGerman deutschmarks. At the time when the sum had become due
\nthe rate  of exchange was $ 1 equal to DM 8.30. At that rate
\nthe sterling  equivalent of  DM 3,756.03 was $ 452 sterling.
\nSome time  later sterling  was devalued.  As a\tresult\t$  1
\nsterling was  only worth  DM 5.85 and consequently the value
\nof $  452 had  fallen to DM 2,664. If the rule in the Havana
\ncase applied  the plaintiffs  would have  got judgment for $
\n452 which  would have  meant only a sum of DM 2,664. whereas
\nif they\t were able to claim and get judgment in deutschmarks
\nthe sterling  equivalent of  DM 3756.03\t would be  $ 641. In
\nother words, by getting judgment in sterling, the plaintiffs
\nwould lose  one-third of  the money  due to them; whereas by
\ngetting it  in deutschmarks  they  would  recover  the\tfull
\namount. The  plaintiffs declined  to give  any evidence with
\nreference to  the rate\tof exchange  but asked\tfor judgment
\nonly in\t deutschmarks as the Federal Republic of Germany was
\na member  of the European Economic Community, They did so by
\nrelying upon  article 106  of the  Treaty of  Rome which  by
\nsection 2(1) of the European Communities Act, 1972, had been
\nmade part of the law of England. The County Court judge held
\nthat the  said article\t106 had\t no bearing  on the  rule of
\ncommon law  and that he could give judgment only in sterling
\nand accordingly\t dismissed the\taction. The plaintiffs filed
\nan appeal. In this case too the defendant did not appear and
\nwas not\t represented before  the Court of Appeal. The appeal
\nwas allowed.  With reference  to  the  English\tlaw  on\t the
\nsubject, apart\tfrom the  Treaty of Rome, Lord Denning M.R.,
\nthe afther  referring to  the rule  in the Havana case, held
\nthat the  reasons for  the rule\t had ceased  to\t exist\tand,
\ntherefore, the\tcourt was  at liberty  to discard  the\trule
\nitself on the principle, “cessante ratione legis cessat ipsa
\nlex” He further said (at pages 156-7):\n<\/p>\n
     “Only last\t year  we  refused  to\tapply  the  rule  to
\n     arbitrations. We  held that  English  arbitrators\thave
\n     jurisdiction  to\tmake  their   awards  in  a  foreign
\n     currency, when  that  currency  of\t the  contract:\t see
\n     jugoslavenska Oceanska  plovibda v.  Castle  Investment
\n     Co. Inc.  The time has now come when we should say that
\n     when the  currency of a contract is a foreign currency-
\n     that is to say, when
\n555<\/span>
\n     the money\tof account  and the  money of  payment is  a
\n     foreign currency-the  English courts have power to give
\n     judgment in  that foreign\tcurrency, they\tcan make  an
\n     order in  the form:  ‘It is  adjudged this day that the
\n     defendant do  pay to  the plaintiff’ so much in foreign
\n     currency (being  the currency  of the contract)’ or the
\n     sterling equivalent  at the  time of  payment’. If\t the
\n     defendant does  not honour\t the judgment, the plaintiff
\n     can apply\tfor leave  to enforce  it. He should file an
\n     affidavit showing\tthe rate  of exchange at the date of
\n     the  application  and  give  the  amount  of  the\tdebt
\n     converted into  sterling at  that date. Then leave will
\n     be given to enforce payment of that sum.<\/p><\/blockquote>\n
     (The emphasis has been supplied by us.)
\nSo far\tas the\tTreaty of Rome was concerned, the Court held
\nthat the  purpose of the said article 106 was to ensure that
\nthe creditor  in one member State should receive payment for
\nhis goods  in his own currency if it was the currency of the
\ncontract without  any impediment or restriction by reason of
\nchanges in the rate of exchange. With respect to the form of
\nthe judgment,  Lord Denning,  with whom Foster J. concurred,
\nheld that  he would  “adjudge that  the debtor do pay to the
\nplaintiff DM 3,756.03 or the sterling equivalent at the time
\nof payment” meaning thereby, as Lord Wilberforce pointed out
\nin the Miliangos case (at page 468), the date when the court
\nauthorizes enforcement of the judgment in terms of sterling.
\nLawton L.J.,  the third\t member of  the court,\ton the other
\nhand, was  of the opinion that the judgment should be in the
\nfrom in\t which the  plaintiffs had  asked for it, namely, in
\ndeutschmarks and  the plaintiffs  must be  left to extricate
\nthemselves from\t the intricacies  of  the  law\trelating  to
\nexecution and  exchange control.  There was no appeal to the
\nHouse of Lords against this judgment of the Court of Appeal.\n<\/p>\n
     We now  come to  the case\tof Miliangos v. George Frank
\n(Textiles) Ltd.\t How that  case reached\t the House  of Lords
\nmakes interesting  reading by  itself. Prior to the judgment
\nbeing delivered\t in the\t Schorsch Meier\t case, Miliangos,  a
\nSwiss, brought\tan action  against George  Frank  (Textiles)
\nLtd., an  English company,  claiming the sum of Swiss Francs
\n415, 522.45  due to him for the price of polyester yarn sold
\nand  dilivered\tto  the\t English  company  under  a  written
\ncontract. The  claim of\t the Swiss  plaintiff was based upon
\ninvoices sent  to the  English company\tand accepted by that
\ncompany
\n556<\/span>
\nand  alternatively   on\t two  bills  of\t exchange  drawn  in
\nSwitzerland by\tthe plaintiff and accepted by the defendants
\nbut which  had been  dishonoured on  presentation  on  their
\nrespective due\tdates. This  alternative claim\twas for\t the
\namounts of  the said bills of exchange, namely, Swiss Francs
\n273,619.45 and\tSwiss Francs  27,394 respectively,  and\t the
\ncost of\t protesting the\t bills and  interest. The  plaintiff
\napparently had\tbeen advised  about the\t position in English
\nlaw and\t had accordingly  claimed judgment in sterling as at
\nthe breach  date. The  defendants claimed that the plaintiff
\nhad committed a breach of contract inasmuch as a part of the
\nyarn dilivered\tto them was unifit for the purpose and filed
\na counter-claim for damages. Thereafter, the plaintiff filed
\na second  suit on another contract in which the claim was on
\nthe  same   alternative\t counts.   Both\t the   actions\twere
\nconsolidated and  set down  for\t hearing,  but\tbefore\tthey
\nreached hearing by their letter dated November 22, 1974, the
\ndefendants abandoned  their defence  and  counter-claim\t and
\nstated that  they would submit to judgment. Four days later,
\non November 26, 1974, the Court of Appeal delivered judgment
\nin the Schorsch Meirer case. Thereupon the plaintiff amended
\nthe statement  of claim\t in the first action and claimed the
\namount due in Swiss Francs as an alternative to the claim in
\nsterling. Bristow  J. held  that the Schorsch Meirer case so
\nfar as it related to countries which were not members of the
\nEuropean Economic  Community was obiter and had been decided
\nper incuriam in that only one party had been represented and
\nall the\t relevant authorities had not been cited. He further
\nheld that  the decision\t in that  case was inconsistent with
\nwhat the  House of  Lords had  held in\tthe Havana  case and
\naccordingly  he\t  gave\tjudgment  for  the  sum\t claimed  in
\nsterling. The  plaintiff went in appeal (Miliangos v. George
\nFrank (Textiles)  Ltd. The  Court of  Appeal held  that\t the
\nSchorsch Meier\tcase was  not decided  per incuriam  and was
\nbinding upon  the trial\t court and  gave  judgment  for\t the
\nplaintiff in  Swiss Francs.  The  English  company  went  in
\nappeal to the House of Lords. We are not concerned with what
\nwas said  in that  case with respect to whether the Schorsch
\nMeier case  was decided\t per incuriam  or not and whether an
\nEnglish court could depart from the rule in the Havana case.
\nSuffice it  to say  that the  House of\tLords by  a majority
\n(Lords Simon  of Glaisdale  dissenting)\t held  that  it\t was
\nlegitimate for\tthe House  of the  Lords to  depart from the
\n“breach date  conversion” rule and recognize that an English
\ncourt was  entitled to\tgive judgment  for a  sum  of  money
\nexpressed in a foreign
\n557<\/span>
\ncurrency in  the case of obligations of a money character to
\npay foreign  currency under  a contract,  the proper  law of
\nwhich was  that of  a foreign country, and when the money of
\naccount was that of that country or possibly of some country
\nother than  the United\tKingdom. The  House of Lords further
\nheld that  the instability  which had  overtaken  the  pound
\nsterling  and  other  major  currencies\t since\tits  earlier
\ndecision in  the Havana\t case  as  well\t as  the  procedures
\nevolved in  consequence thereof by the English courts and by
\narbitrators in\tthe City  of London  to\t secure\t payment  of
\nforeign\t currency   debts  in  foreign\tcurrency,  justified
\ndeparture from\tthat  decision\tin  terms  of  the  Practice
\nStatement  (Judicial   Precedent)  (under  which  the  House
\naffirmed its  power to\tdepart from a previous decision when
\nit appeared  right to  do so,  recognizing that too rigid an
\nadherence  to\tprecedent  might  lead\tto  injustice  in  a
\nparticular case\t and unduly  restrict the development of the
\nlaw) since  a new and more satisfactory rule could be stated
\nto enable  the courts to keep step with commercial needs and
\nwould\tnot   involve\tundue\tpractical   and\t  procedural
\ndifficulties.\n<\/p>\n
     We are  concerned here  with what was said in that case
\nwith respect  to the date to be taken for converting foreign
\ncurrency into  English currency.  Lord Wilberforce  held (at
\npages 468-9)  that the claim should be made specifically for
\nthe  foreign  currency\tand  to\t this  might  be  added\t the
\nalternative “or the sterling equivalent at the date of…..”
\nand that  as regards  the conversion  date to be inserted in
\nthe claim  or in  the judgment of the court, though the date
\nof judgment was a workable date, he would favour the date of
\npayment meaning\t thereby the  date when the court authorizes
\nenforcement of the judgment in terms of sterling, because in
\nsome cases, particularly where there was an appeal, the date
\nof judgment  might impose  upon the  creditor a considerable
\ncurrency risk,\tLord Wilberforce  further observed  (at page\n<\/p>\n
469):\n<\/p>\n
\t  In the  case of  arbitration, there may be a minor
\n     discrepancy,  if\tthe  practice  which  is  apparently
\n     adopted (see  the Jugoslavenska  case (1974)  Q.B. 292,\n<\/p><\/blockquote>\n
     305) remains  as it is, but I can see no reason why, if
\n     desired, that  practice should not be adjusted so as to
\n     enable conversion\tto be made as at the date when leave
\n     to enforce in sterling is given.”<\/p><\/blockquote>\n
     (The emphasis has been supplied by us.)
\n558<\/span>
\n     Lord Cross of Chelsea pointed out (at pages 497-8) that
\nit  would  be  absurd  to  have\t one  rule  with  regard  to
\narbitrations on\t debts expressed  in a\tforeign currency and
\nanother with  regard to actions on similar debts and that in
\na  case\t where\tthe  defendant\tfailed\tto  deliver  foreign
\ncurrency for  the payment  of which  the judgment was given,
\nthe date for its conversion into sterling should be the date
\nwhen the  plaintiff was\t given leave to levy execution for a
\nsum expressed  in sterling. Lord Edmund-Davies, referring to
\nthe Jugoslavenska  case,  said\t(at  page  501)\t that  being
\ngoverned by  section 26\t and sub-section  (1) of  section 36
\n(which deals  with enforcement\tof foreign  awards)  of\t the
\nArbitration Act, 1950, the award of American dollars in that
\ncase of\t necessity had\tto be converted into sterling at the
\nrate of\t exchange prevailing  on the date when the award was
\nmade and that but for that fact, the most just rate would be
\nthat prevailing\t when the  award was being enforced, for the
\nplaintiff had  been kept  out of  his money  until then\t and
\nthere was  no reason  why this latter rate should not be the
\none adopted  when judgments  expressed in a foreign currency
\nare  being   enforced.\tAccording   to\tLord  Edmund-Davies,
\nMiliangos should  have been  given judgment mutatis mutandis
\nin the\tform approved  of by  Lord Denning  M.R. in Schorsch
\nMeier case,  namely, that  “it is this day adjudged that the
\ndefendant do pay to the plaintiff 416,144.20 Swiss francs or
\nthe sterling equivalent at the time of payment”, which would
\nmean, as  pointed out by Lord. Wilbeforce (at page 368), the
\ndate when  the court  authorizes enforcement of the judgment
\nin terms  of sterling, Lord Fracer of Tullybelton opined (at
\npage 502)  that to  take the date of the commencement of the
\naction might  result in consequences as unjust as taking the
\nbreach date  because between the commencement of an action a
\nperiod of  a year  or more might easily elapse, allowing for
\nappeals, before\t payment was  made  and\t that  the  date  of
\njudgment would\tbe better but there seemed no reason why the
\nlatest practicable  date, namely,  the date  when the  court
\nauthorizes the\tenforcement of\tthe judgment  should not  be
\ntaken. Lord  Simon  of\tGlaisdale  held\t in  his  dissenting
\njudgment that  there was  no reason  for departing  from the
\nrule laid  down in the Havana case and that this should only
\nbe done\t by Parliament\ton executive  or expert advice. With
\nreference to  the Jugoslavenska case Lord Simon observed (at
\npage 489):\n<\/p>\n
\t  “If the sterling judgment rule and the breach date
\n     rule were\tto be  reconsidered by\ta properly qualified
\n     body, no doubt the Jugoslavenska case would come within
\n     its purview.”<\/p><\/blockquote>\n
559<\/span><\/p>\n
     The principle  laid down  by the  House of Lords in the
\nMiliangos case\twas extended  by it to include a claim based
\non damages  for torts  and for\tbreaches of  contract in its
\ndecision in  Owners of\tM.V. Eleftherotria  v. The Owners of
\nM.V. Despina  R-The Despina R and Services Europe Atlantique
\nSud (Seas)  of Paris  v. Stockholms Rederiahtiebolag Svea of
\nStockholm, better  known as  The Despina  R, in\t two appeals
\nheard one  after the  other and\t disposed  of  by  a  common
\njudgment.\n<\/p>\n
     The first\tappeal arose  out of a collision between two
\nGreek ships,  the Despina  R and  the Eleftherotria in which
\nthe latter  was damaged.  The Eleftherotria  was owned\tby a
\nLiberian company  which had  its head office in Piracus. The
\nmanaging agents had their principal place of business in New
\nYork and  the bank  account used  for  moneys  received\t and
\npayments made  on behalf  of the  owners was  a U.S.  dollar
\naccount in  New York.  An agreement  was reached  under\t the
\nterms of  which the  owners of\tthe Despina R were to pay to
\nthe owners  of the Eleftherotria 85 per cent or the loss and
\ndamage suffered\t as a  result of the collision. The expenses
\nof repair  had been  incurred  in  various  currencies.\t The
\nquestion whether  the damages were to be paid in sterling or
\nsome other  currency was  referred to  the Admiralty  judge.
\nBrandon J. held that he had jurisdiction to award damages in
\na foreign  currency, but  that he  was bound by authority to
\naward them  in the  currency of\t expenditure. The  Court  of
\nAppeal, dismissing  an appeal by the owners of the Despina R
\nand allowing a cross appeal, held that here was jurisdiction
\nto award  damages in  tort  in\tsterling  or  in  a  foreign
\ncurrency, and  that, in\t the circumstances  of the case, the
\nappropriate currency  was the  plaintiffs’  currency  rather
\nthan the currency of the expenditure.\n<\/p>\n
     The second\t appeal was  in respect of a cargo of onions
\nshipped to  Brazil by  the French  charterers of  a Swedish-
\nowned motor  vessel, the  Folias. The cargo arrived damaged,
\nand the\t cargo receivers’  claim for  damages was settled by
\nthe charterers\tin Brazilian cruzeiros, which they purchased
\nwith French Francs, their normal business currency. The hire
\nunder the  charter party was payable in U.S. dollars and the
\nproper law  of the  contract was English law. In arbitration
\nproceedings the\t owners\t admitted  their  liability  to\t the
\ncharterers, but\t contended that\t payment should\t be made  in
\ncruzeiros. By then the
\n560<\/span>
\nvalue of  the cruzeiro\tagainst the  French Francs  was half
\nwhat it\t had been  when the  charterers had  paid the  cargo
\nreceivers.  The\t arbitrators  made  their  award  in  French
\nFrancs, On  a special  case stated  Robert Goff J. held that
\nthe award  should have\tbeen made  in cruzeiros as being the
\ncurrency of  the loss. On appeal by the charterers the Court
\nof Appeal restored the award of the arbitrators.\n<\/p>\n
     The owners\t of the\t Despina R  as also the Swedish ship
\nowners went  in appeal\tto the\tHouse  of  Lords.  Both\t the
\nappeals were dismissed. The House held that in a claim based
\non tort,  it was  fairer to give judgment in the currency in
\nwhich the loss was sustained than in the sterling equivalent
\nat the date of the breach or loss; that the principles to be
\napplied in  ascertaining the currency of the loss were those
\nof restitution\tin integrum  and  reasonable  foreseeability
\nand, therefore,\t where a  plaintiff proved that he conducted
\nhis business  in a  specific currency  and it was reasonably
\nforeseeable that  he would the that currency to purchase the
\nnecessary  currency   to  meet\t the  immediate\t and  direct
\nexpenditure caused  by the  defendant’s tort,  then judgment
\nshould\tbe   expressed\tin  the\t plaintiff’s  currency\tand,
\naccordingly, the  Court of  Appeal had\tproperly varied\t the
\norder  from  a\tjudgment  expressed  in\t the  currencies  of
\nexpenditure to\tthe currency  of the  business conducted  on
\nbehalf of  the owners  of the  Eleftherotria,  namely,\tU.S.
\ndollars. The  following passage\t from the  opinion  of\tLord
\nWilberforce (at pages 696-7) is instructive:\n<\/p>\n
\t  “I do\t not think  that there\tcan now be any doubt
\n     that given\t the ability  of an  English court  (and  of
\n     arbitrators sitting  in this  country) to give judgment
\n     or make  an award\tin a  foreign currency,\t to  give  a
\n     judgment  in   the\t currency  in  which  the  loss\t was
\n     sustained produces a juster result than one which fixes
\n     the plaintiff  with a sum in sterling taken at the date
\n     of the breach or of the loss.”\n<\/p><\/blockquote>\n
It was\tfurther held  that where  the terms  of\t a  contract
\ngoverned by  English law did not expressly or by implication
\nshow that  the parties\thad intended  that payments  arising
\nfrom a breach of contract were to be paid in the currency of
\naccount or  other named\t currency,  the\t court\tshould\tgive
\njudgment in  the currency  that best  expressed the  party’s
\nloss; that, although the appeal in the second case concerned
\na  charterparty\t  which\t expressly   stated   that   certain
\ncontractual payments  should be\t made in  U.S. dollars,\t the
\nterms of  the charterparty  did not  show that\tpayment\t for
\ndamage arising out of a breach of contract
\n561<\/span>
\nwas to\tbe made\t in that  currency; that,  arising from\t the
\nowners, breach\tthe charterers\thad used  French  Francs  to
\npurchase the  necessary cruzeiros  to settle  the receivers’
\nclaim and,  in those  circumstances, the Court of Appeal had
\ncorrectly  affirmed   the  arbitrators’\t decision  that\t the
\ncurrency that  best expressed  the charterers’\tloss was the
\ncurrency of  their business,  namely,  French  Francs.\tWith
\nrespect to  the arbitrators jurisdiction to make an award in
\na foreign currency, Lord Wilberforce said (at pages 702-3);\n<\/p>\n
\t  “In my  opinion a  decision in  what currency\t the
\n     loss was  borne or\t felt can be expressed as equivalent
\n     to finding\t which currency\t sum appropriately or justly
\n     reflects the  recoverable loss.  This is  essentially a
\n     matter  for  arbitrators  to  determine.  A  rule\tthat
\n     arbitrators may  make their  award in the currency best
\n     suited to achieve an appropriate and just result should
\n     be a  flexible rule  in which  account must be taken of
\n     the circumstances in which the loss arose, in which the
\n     loss was  converted into  a money\tsum, and in which it
\n     was felt by the plaintiff. In some cases the ‘immediate
\n     loss’  currency  may  be  appropriate,  in\t others\t the
\n     currency in  which it was borne by the plaintiff. There
\n     will be  still others in which the appropriate currency
\n     is the  currency of the contract. Awards of arbitrators
\n     based upon\t their appreciation  of the circumstances in
\n     which the\tforeign currency  came to be provided should
\n     not be set aside for, as such, they involve no error of
\n     law.”<\/p><\/blockquote>\n
     It will  also be  useful to  refer\t at  this  stage  to
\ncertain\t Practice   Directions\tgiven,\tfollowing  upon\t the
\nMiliangos case,\t with respect  to claims  and  judgments  in
\nforeign currency  and enforcement  of  such  judgments.\t The
\nMiliangos case\twas decided  on\t November  5,1975,  and\t the
\nPractice Directions  in question  were issued  by the Senior
\nMaster of  the Supreme\tCourt of  judicature (Queen’s  Bench
\nDivision) on  December 18,1975,\t with the concurrence of the
\nChief Chancery\tMaster acting  on the authority of the Vice-
\nChancellor so  far as  they applied  to the  practice in the
\nChancery Division, and of the Senior Registrar of the Family
\nDivision. so  far as  they applied  to the  practice in that
\nDivision. As pointed out in Halsbury’s Laws of England, 4th
\n562<\/span>
\ned.,  vol.   37,  para.\t 12,  practice\tdirections  “provide
\ndirections as  to matters  of practice and procedure for the
\nassistance and guidance of litigants in the conduct of their
\nproceedings, and  in the  administration  of  civil  justice
\ngenerally, and, although they lack the force of law they are
\nof enormous  value, to\tthe courts,  to practitioners and to
\nall who\t are involved  in the civil judicial process”. Under
\nthe Practice  Directions dated\tDecember 18,1975,  mentioned
\nabove, before  a writ  of summons  is issued  in  which\t the
\nplaintiff makes\t a claim  for a\t debt or a liquidated demand
\nexpressed in  a foreign\t currency, the writ must be endorsed
\nwith a\tcertificate signed  by or on behalf of the solicitor
\nof the\tplaintiff or  by the  plaintiff, if  he is acting in
\nperson, certifying  the\t rate  current\tin  London  for\t the
\npurchase of  the unit of the foreign currency claimed at the
\nclose of  business on the date next or most nearly preceding
\nthe date  of the  issue of  the writ  and stating whether at
\nthat rate  of exchange the debt or liquidated demand claimed
\nin the\twrit amounts  to “$..  or exceeds $ 650 (as the case
\nmay be)”,  This certificate  is required  for the purpose of
\nascertaining the  proper amount\t of the costs to be endorsed
\non the\twrit. The judgment which would be entered in respect
\nof such\t a claim  would show  that it has been adjudged that
\nthe defendant  do pay  the  plaintiff  the  sum\t in  foreign
\ncurrency for  which the\t court has  ordered judgment  to  be
\nentered or  its sterling  equivalent at the time of payment.
\nWhere a\t defendant desires  to pay into court a sum of money
\nin satisfaction\t of the\t claim in foreign currency he may do
\nso subject  to the requirements of the Exchange Control Act,
\n1947. Where,  however, a  plaintiff  desires  to  enforce  a
\njudgment expressed in a foreign currency by the issue of the
\nwrit of fieri facias, the praecipe for the issue of the writ
\nmust first  be endorsed\t and signed  by or  on behalf of the
\nsolicitor of  the plaintiff  or by  the plaintiff,  if he is
\nacting in  person, with a certificate certifying the rate of
\nexchange current  in London  for the  purpose of the unit of
\nthe foreign  currency in which the judgment is expressed, at
\nthe close of the business on the date nearest or most nearly
\npreceding the  date of\tthe issue of the writ and mentioning
\nwhat the amount in pound sterling at that rate would be. The
\namount so  certified will  then be  entered in\tthe writ  of
\nfi.fa. A similar certificate is required where the plaintiff
\ndesires to  enforce a  judgment debt  expressed in a foreign
\ncurrency by adopting garnishee proceedings or other modes of
\nexecution.\n<\/p>\n
     The above\tsurvey shows  the position in English law to
\nbe as follows:\n<\/p>\n
563<\/span><\/p>\n
     (1)  Until\t recently   the\t  rule\t that\twas   firmly
\n\t  established was  that an  English court could give
\n\t  judgment only in English currency and that for the
\n\t  purposes of  litigation in  England to  recover  a
\n\t  debt expressed  in a\tforeign currency,  such debt
\n\t  had to  be converted\tinto sterling with reference
\n\t  to the  rate of  exchange prevailing\ton the\tdate
\n\t  when the  debt was payable. This rule was affirmed
\n\t  by the House of Lords in the Havana case.
\n     (2)  The reason  for this\trule was  that sterling\t was
\n\t  regarded as  a stable currency and a constant unit
\n\t  of value;  and that by taking the rate of exchange
\n\t  at the  date of the breach, the creditor was being
\n\t  put into  as good  a position as if the debtor had
\n\t  done his duty and paid the debt on the due date.
\n     (3)  After sterling  ceased to be a stable currency and
\n\t  became   subject    to   fluctuations\t   in\t the
\n\t  international\t monetary   market  a  new  line  of
\n\t  thinking  began   to\t emerge,   particularly\t  in
\n\t  commercial arbitrations  where foreign  currencies
\n\t  were involved,  and the arbitrators in the City of
\n\t  London started  making awards expressed in foreign
\n\t  currency.\n<\/p><\/blockquote>\n
     (4)  This new  trend found\t judicial recognition in the
\n\t  Jugoslavenska case  in which\tthe Court  of Appeal
\n\t  held that  arbitrators in England had jurisdiction
\n\t  to make  an award  in a foreign currency in a case
\n\t  in which  the money  payable under  a contract  is
\n\t  payable in a foreign currency. The Court of Appeal
\n\t  further held\tthat section  26, now section 26(1),
\n\t  of the  English Arbitration  Act, 1950,  should be
\n\t  construed having  regard to  section 36(1) of that
\n\t  Act,\twhich  deals  with  enforcement\t of  foreign
\n\t  awards, and that the words “to the same effect” in
\n\t  the expression  “an award…may..  be enforced  in
\n\t  the same manner as a judgment or order to the same
\n\t  effect” in  section 26(1)  did not mean a judgment
\n\t  or order  “in the same terms” but meant a judgment
\n\t  or order  having “the\t same effect”  this would be
\n\t  achieved if the sum awarded were
\n564<\/span>
\n\t  converted into  sterling at  the rate\t of exchange
\n\t  prevailing on\t the date  of the  award,  and\tthat
\n\t  leave to  enforce an\taward expressed in a foreign
\n\t  currency should be given by the court provided the
\n\t  applicant had\t filed an affidavit showing the rate
\n\t  of exchange as at the date of the award and giving
\n\t  the amount of the award converted into sterling.
\n     (5)  In the  Jugoslavenska case,  the Court  of  Appeal
\n\t  took\tthe  date  of  the  award  as  the  date  of
\n\t  conversion by\t reason of the interpretation placed
\n\t  by it\t upon the  words “to  the  same\t effect”  in
\n\t  section  26(1)   of  the  Arbitration\t Act,  1950,
\n\t  because  an\taward  could   for  the\t purpose  of
\n\t  enforcement have  the same effect as a judgment in
\n\t  an action  on the  award only\t if the\t date of the
\n\t  award were  taken as the date of conversion as, by
\n\t  reason of  the decision  in the Havana case, which
\n\t  was then  the law,  in such  an action the date of
\n\t  conversion would  have  to  be  the  due  date  of
\n\t  payment which,  the debt being crystallized by the
\n\t  award, would\tbe the\tdate of\t the award,  and the
\n\t  judgment, therefore,\tin such an action would have
\n\t  to be given on that basis.\n<\/p><\/blockquote>\n
     (6)  The development  in law  was carried\tyet one step
\n\t  further in  the Schorsch  Meier case\twhere in  an
\n\t  action for the price of goods, the plaintiff being
\n\t  a member  of the  European Economic Community, the
\n\t  Court of  Appeal held\t that the  court could\tgive
\n\t  judgment to  the creditor in a foreign currency if
\n\t  that was  the currency of the contract, that is to
\n\t  say, if  the money  of account  and the  money  of
\n\t  payment is  foreign currency.\t The court also held
\n\t  that the  date of conversion should be the date of
\n\t  payment  meaning   thereby  as   Lord\t Wilberforce
\n\t  pointed out  in the  Miliangos case (at page 468),
\n\t  the date when the court  authorizes enforcement of
\n\t  the judgment in terms of sterling.\n<\/p><\/blockquote>\n
     (7)  The Schorsch\tMeier case  was not  decided  purely
\n\t  upon Article\t106 of\tthe Treaty  of Rome which by
\n\t  section 2(1)\tof  the\t European  Communities\tAct,
\n\t  1972, had
\n565<\/span>
\n\t  been made  part of  the law of England, but it was
\n\t  also decided\tupon the  general principle that the
\n\t  reasons for  the rule\t in the\t Havana case  having
\n\t  ceased to  exist, the\t court\twas  at\t liberty  to
\n\t  discard the  rule itself.  Thus, what the Schorsch
\n\t  Meier case  decided was  directly contrary  to the
\n\t  decision of the House of Lords in the Havana case.
\n     (8)  Both the Jugoslavenska case and the Schorsch Meier
\n\t  case were  decided without  the other\t side  being
\n\t  represented. From this it does not follow that the
\n\t  judgments delivered  in those cases were not folly
\n\t  considered judgments. The leading judgment in each
\n\t  of these  two cases was that Lord Denning M.R. who
\n\t  at the date when the Havana case was decided was a
\n\t  member of  the House\tof Lords.  In his concurring
\n\t  opinion  in\tthe  Havana   case  he\thad  already
\n\t  expressed a  doubt and  posed a  query whether the
\n\t  “breach date”\t rule should  continue to be applied
\n\t  when sterling\t had lost  the value  it once had by
\n\t  reason of the devaluation of the pound.
\n     (9)  The question\tagain fell  for consideration by the
\n\t  House of  Lords in  the Miliangos  case.  In\tthat
\n\t  case, the House of Lords departed from the rule in
\n\t  the  Havana\tcase,  namely,\t “the  breach\tdate
\n\t  conversion” rule  and recognized  that an  English
\n\t  court could give judgment in a foreign currency in
\n\t  a case  where under a contract the money was to be
\n\t  paid in  that currency  if the  proper law  of the
\n\t  contract was\tthat of\t a foreign  country and\t the
\n\t  money of  account was\t of that  country. So far as
\n\t  the date  of conversion was concerned, all the Law
\n\t  Lords, except\t Lord Simon  of\t  Glaisdale, were of
\n\t  the opinion  that it\tshould be  the date when the
\n\t  court authorizes  the enforcement  of the judgment
\n\t  in terms of sterling.\n<\/p><\/blockquote>\n
     (10) Though the  Jugoslavenska case  was not  expressly
\n\t  overruled  in\t the  Miliangos\t case,\tin  all\t the
\n\t  opinions delivered  in that  case  except  in\t the
\n\t  opinion of  Lord Frasser  of Tullybelton  where no
\n\t  reference is\tmade to\t that case,  it was  doubted
\n\t  whether in the future the
\n566<\/span>
\n\t  rule in  the Jugoslavenska  case should  or  would
\n\t  hold the  field. Lord\t Wilberforce opined  that he
\n\t  saw  no  reason  why,\t if  desired,  the  practice
\n\t  adopted in  that case should not be adjusted so as
\n\t  to enable  coversion to  be made  at the date when
\n\t  leave to  enforce the\t award in sterling is given.
\n\t  Lord Cross of Chelsea thought it absurd that there
\n\t  should be  one rule  for arbitrations with respect
\n\t  to debts  expressed  in  a  foreign  currency\t and
\n\t  another rule\twith respect  to actions  on similar
\n\t  debts.  Lord\t Edmund-Davis  said   that  in\t the
\n\t  Jugoslvenska case  the rate of exchange prevailing
\n\t  on the  date of the award had to be adopted by the
\n\t  court because of the provisions of sections 26 and
\n\t  36(1) of  the English Arbitration Act and that but
\n\t  for such  provisions the  most just  rate would be
\n\t  that prevailing when the award was being enforced.
\n\t  Even Lord  Simon of  Glaisdale in  his  dissenting
\n\t  opinion expressed the view that if Parliament were
\n\t  to reconsider\t the sterling  judgment rule and the
\n\t  breach date  rule, the  rule in  the Jugoslavenska
\n\t  case\twould\tcome  within  the  purview  of\tsuch
\n\t  reconsideration.\n<\/p><\/blockquote>\n
     (11) The principle\t laid down in the Millangos case was
\n\t  extended by  the House of Lords in the case of The
\n\t  Despina R  to actions\t in tort and for damages for
\n\t  breach of  contract on  the  ground  that  it\t was
\n\t  fairer to  give judgment  in the currency in which
\n\t  the  loss  was  sustained  than  in  its  sterling
\n\t  equivalent at\t the date of the breach or loss, the
\n\t  principles  to  be  applied  in  ascertaining\t the
\n\t  currency of  the loss being those of restitutio in
\n\t  integrum  and\t reasonable  foreseeability  of\t the
\n\t  plaintiff using  a particular\t foreign currency to
\n\t  purchase  the\t  necessary  currency  to  meet\t the
\n\t  immediate and\t direct expenditure  caused  by\t the
\n\t  defendant’s tort  or breach  of contract.  It\t was
\n\t  further held\tthat in\t the case of arbitrations it
\n\t  was for  the\tarbitrators  to\t determine  in\twhat
\n\t  currency the\tloss was  borne or felt and that the
\n\t  rule that  arbitrators may make their award in the
\n\t  currency best suited to achieve an appropriate and
\n\t  just result  should be  a flexible  rule in  which
\n\t  regard should be had to the
\n567<\/span>
\n\t  circumstances in  which the  loss arose,  in which
\n\t  the loss  was converted  into a  money sum, and in
\n\t  which it was felt by the plaintiff.\n<\/p><\/blockquote>\n
     (12) So far  as practice  and procedure  is  concerned,
\n\t  under the  Practice Directions  dated December 18,
\n\t  1975, for  the purpose  of ascertaining the proper
\n\t  amount of  the costs to be endorsed on the writ of
\n\t  summons   the\t  plaintiff’s\tsolicitor   or\t the
\n\t  plaintiff, if\t he  is\t acting\t in  person,  is  to
\n\t  certify the  rate of exchange current in London at
\n\t  the close of the business on the date next or most
\n\t  nearly preceding the date of the issue of the writ
\n\t  and to mention the sterling equivalent at the rate
\n\t  of the  sum in  foreign currency  claimed  in\t the
\n\t  action. The  judgment is to be entered for the sum
\n\t  in foreign  currency adjudged\t by the\t court to be
\n\t  payable by  the defendant  to the plaintiff or its
\n\t  sterling equivalent  at the  time of payment. None
\n\t  the less  if a  judgment  is\tto  be\tenforced  by
\n\t  execution, the  application for  execution  is  to
\n\t  state the  rate of  exchange current\tin London on
\n\t  the date nearest or most nearly preceding the date
\n\t  when the application is made.<\/p><\/blockquote>\n
     We have spent some time in ascertaining the English law
\non the\tsubject by reason of the absence of any authority of
\nany Indian  court on  this point  and  because\tthe  learned
\nSingle Judge  has based\t his decision  on the Miliangos case
\nwhile the  Division Bench  of the Delhi High Court has based
\nits  on\t  the  Jugoslavenska   case.  Further,\tthe  English
\ndecisions referred  to by us are of courts of a country from
\nwhich we  have derived our jurisprudence and a large part of
\nour laws and in which the judgments were dilivered by judges
\nheld in\t high repute.  Undoubtedly, none  of these decisions
\nare binding upon this Court but they are authorities of high
\npersuasive value  to which  we\tmay  legitimately  turn\t for
\nassistance. Whether the rule laid down in any of these cases
\ncan be applied by our courts must, however, be judged in the
\ncontext of our own law and legal procedure and the practical
\nrealities of litigation in our country. When a foreigner has
\nto receive  a sum of money which should justly be payable to
\nhim in a foreign currency and, because of the default of the
\npaying party,  seeks to\t recover  its  payment\tthrough\t the
\ncourt, the first question which arises is whether a court in
\nIndia would have
\n568<\/span>
\njurisdiction to\t pass a\t decree for  a sum  expressed  in  a
\nforeign currency. Though on principle there is no reason why
\na court\t should not  be able  to do  so no  court can pass a
\ndecree directing  a defendant  to do  an  impossible  or  an
\nillegal act  and in  view of  the provisions  of our Foreign
\nExchange  Regulation   Act,  1973,   and  the\trestrictions
\ncontained therein  on making payments in a foreign currency,
\nif a  decree  were  to\tbe  passed  Simpliciter\t for  a\t sum
\nexpressed in  a foreign\t currency, it would be to direct the
\ndefendant to  do an  act which\twould be in violation of the
\nForeign Exchange  Regulation Act,  1973. Such  a decree can,
\ntherefore, only\t be passed  by making the payment in foreign
\ncurrency subject  to the  permission of the foreign exchange
\nauthorities being  granted. If\thowever, the  authorities do
\nnot grant  permission for  payment of  the judgment  debt in
\nforeign currency, it would not be possible for the defendant
\nto make\t such payment,\tresulting  in  the  decree  becoming
\ninfructuous and\t the plaintiff getting nothing under it. The
\nview of\t Lawton L.J.  in the  Schorsch Meier  case that\t the
\nplaintiff should  be given  judgment in the form in which he
\nasked for  it and must be left to extricate himself from the
\nintricacies of\tthe law\t relating to  execution and exchange
\ncontrol does not commend itself to us for it does not appear
\nto us  to be  conducive to  the ends  of justice.  The court
\nmust, therefore,  provide for the eventuality of the foreign
\nexchange authorities  not granting  the requisite permission
\nor even\t if such  permission is\t given,\t the  defendant\t not
\npaying the  decretal debt,  or not  wanting to discharge the
\ndecree by  making payment  in foreign  currency or in Indian
\nrupees. This can only he done by the decree providing in the
\nalternative for\t payment of a sum of money in Indian rupees,
\nwhich will  be equivalent  to the  sum\tdecreed\t in  foreign
\ncurrency. It  is but just that a man, who is in law entitled
\nto receive  a sum  of money  in a  foreign currency,  should
\neither receive\tit in  such currency  or should\t receive its
\nequivalent in Indian rupees. It is here that the question of
\nthe date  which\t the  court  should  select  for  converting
\nforeign currency  into Indian  rupees arises. The court must
\nselect a  date which puts the plaintiff in the same position
\nin which he would have been had the defendant discharged his
\nobligation when\t he ought to have done, bearing in mind that
\nthe  rate   of\texchange   is  not  a  constant\t factor\t but
\nfluctuates, and\t very often  violently fluctuates, from time
\nto time.  With these  considerations in\t mind, we  will\t now
\nexamine the  feasibility of  the several dates set out by us
\nat the beginning of our discussion on this point.\n<\/p>\n
     The first\tof the\tfive dates  listed  earlier  by\t us,
\nnamely, the  date when\tthe amount  became due\tand payable,
\ndoes not have the effect
\n569<\/span>
\nof putting  the plaintiff  in the  same position in which he
\nwould have  been had the defendant discharged his obligation
\nwhen he\t should have  done because between that date and the
\ndate when  the suit is decreed the rate of exchange may have
\nfluctuated to  the plaintiff’s\tprejudice, resulting  in the
\namount decreed\tin rupees  representing only  a fraction  of
\nwhat he was entitled to receive. Equally, the possibility of
\nthe plaintiff getting more than what he had bargained for in
\ncase the  rate of  exchange had\t fluctuated  in\t his  favour
\ncannot be  ruled out.  To select,  as the English courts had
\ndone earlier,  the date\t when the  amount became  due or the
\n“breach date”, as the English courts have termed it, is thus
\nto expose  the parties\tto the\tunforeseeable changes in the
\ninternational monetary market. The selection of the  “breach
\ndate” cannot,  therefore,  be  said  to\t be  just,  fair  or
\nequitable because  in a\t case where the rate of exchange has
\ngone against  the plaintiff, the defendant escapes by paying
\na lesser  sum than  what he  was bound\tto and\tthus is\t the
\ngainer by  his default\twhile in the converse case where the
\nrate  of  exchange  has\t gone  against\tthe  defendant,\t the
\ndefendant would\t be subjected to a much\t greater burden than
\nwhat he should be.\n<\/p>\n
     The second\t of the\t dates mentioned  above, namely, the
\ndate of\t the commencement  of the action or suit, is equally
\nsubject to the same criticism. This date was rejected in the
\nMiliangos case\tbecause, according  to Lord  Wilberforce (at
\npage 469), it placed “the creditor too severely at the mercy
\nof the\tdebtor’s obstructive  defences.. or the law’s delay”
\nIn that case Lord Fraser of Tullybelton pointed out (at page\n<\/p>\n
502) that  if the  date of  the commencement  of the  action
\n“were to be taken for conversion, a period of a year or more
\nmight easily  elapse. allowing\tfor appeals,  before payment
\nwas made.” In our country, it is the misfortune of litigants
\nthat by\t reason of  ever-increasing  volume  of\t litigation,
\novercrowded court  dockets and undermanned courts, suits are
\noften not disposed of for an unconscionably long time and if
\nwe take\t into account  the  time  that\twould  be  spent  in
\nappeals,  further   appeals,   and   revision\tand   review
\napplications which  may\t be  filed,  the  longevity  of\t the
\nlitigation is doubled, if not tripled, so that none can with
\nany  certainty\t predict  even\t a  probable  date  for\t its
\ntermination. The  selection of the date of the filing of the
\nsuit would, therefore, leave the parties in as uncertain and
\nprecarious a  position as the selection of the date when the
\namount became payable or the “breach date”.\n<\/p>\n
570<\/span><\/p>\n
     We will  now consider  the feasibility of selecting the
\nthird date,  namely,  the  date\t of  the  decree.  A  decree
\ncrystallizes the  amount payable  by the  defendant  to\t the
\nplaintiff and  it is the decree which entitles the judgment-
\ncreditor to  recover the judgment debt through the processes
\nof law.\t An  objection\twhich  can,  however,  be  taken  to
\nselecting this date is that the decree of the trial court is
\nnot the\t final decree  for there  may be  appeals  or  other
\nproceedings against  it in  superior courts  and by the time
\nthe matter  is finally\tdetermined,  the  rate\tof  exchange
\nprevailing on  that date  may be  nowhere  near\t that  which
\nprevailed at  the date\tof the decree of the trial court. To
\nselect the  date of  the decree\t of the\t trial court  as the
\nconversion date would, therefore, be to adopt as unrealistic
\na  standard  as\t the  ‘breach  date”.  This  difficulty\t is,
\nhowever, easily\t overcome by  selecting the  date  when\t the
\naction is  finally disposed of, in the sense that the decree
\nbecomes final  and binding  between the\t parties  after\t all
\nremedies against  it are  exhausted. This can be achieved by
\nthe court  which hears the appeal providing that the date of
\nits decree  or other  proceeding  in  which  the  decree  is
\nchallenged would  be the  date for conversion of the foreign
\ncurrency sum  into Indian  rupees in  cases where the decree
\nhas not been executed in the meantime. The real objection to
\nselecting this date, however, is that a money decree and the
\npayment by the judgment debtor of the judgment debt under it
\nare  two   vastly  different  matters  widely  separated  by
\nsuccessive execution  applications  and\t objections  thereto
\nunless the  judgment-debtor chooses  to pay  up the judgment
\ndebt of\t his own  accord which is generally not the case. In
\nthe vast  majority of cases a money decree is required to be
\nenforced by execution.\n<\/p>\n
     Would the\tproper date  of conversion  then be the date
\nwhen the court-orders execution to issue ? This date appears
\nto have\t found favour with all the Law Lords who decided the
\nMiliongos case, except Lord Simon of Glaisdale. We, however,
\nfind  the   selection  of   this  date\tequally\t beset\twith
\ndifficulties. Execution\t of a decree is not a simple matter.
\nIn execution  of a money decree, first the judgment-debtor’s
\nproperty has  to be  attached. Pending\tattachment  a  third
\nparty, at  times set up by the judgment-debtor, may prefer a
\nclaim to  the attached\tproperty. Such claim will have to be
\ninvestigated and  determined by\t the executing\tcourt.\tEven
\nwhere no  claim is preferred the attached property cannot be
\nbrought to  sale  immediately.\tA  proclamation\t giving\t the
\nprescribed particulars has to be first made. Even after such
\nproclamation, the  property cannot  be put up for sale until
\nafter the expiry of the period prescribed by O. 21 r. 68 of
\n571<\/span>
\nthe Code  of Civil Procedure, 1908 (V of 1908), unless it is
\nsubject to  speedy and\tnatural decay or when the expense of
\nkeeping it  in custody\tis likely  to exceed its value. Even
\nafter the  sale has  taken  place  the\tjudgment-debtor\t may
\nfurther hold  up the  receipt of  the sale  proceeds by\t the
\ndecree-holder by  raising objection  to the  conduct of\t the
\nsale. Even  otherwise, at  times, a  fresh auction  sale may
\nhave to\t be held if the auction purchaser commits default in
\npaying the  balance of\tthe purchase  price. A\tconsiderable
\ntime would  thus elapse\t between the  date  when  the  court
\norders execution to issue and the date of the receipt of the
\nsale proceeds  by the  decree-holder. This  passage of\ttime
\nwould as  much expose  the decree-holder  to the  hazards of
\nfluctuations in\t the rate of exchange as selection of any of
\nthe  three  dates  we  have  discussed\tabove.\tYet  another
\ndifficulty in  selecting the  date  when  the  court  orders
\nexecution to issue is that at times the judgment debt is not
\nrecovered in  full when\t the attached  property is  sold  in
\nexecution.  This   necessitates\t a   second  application  in
\nexecution for  attaching other\tproperties of  the judgment-
\ndebtor and  even the  sale of these properties may not cover
\nthe  deficit,\tthus  necessitating  yet  another  execution
\napplication. They  would lead  to an  anomalous position for
\nthe court  would have  to fix  the rate\t of exchange for the
\nentire decretal\t debt at  the time  of\tgranting  the  first
\napplication for\t execution and then, if the rate of exchange
\nhas varied  in the  meantime, to  fix a\t different  rate  of
\nexchange for  the unrealized  balance of the decretal amount
\nat  the\t  time\tof   granting  the  second  application\t for
\nexecution,  and\t  equally  so  with  respect  to  successive
\napplications for  execution. Thus,  with respect to portions
\nof the\tsame decretal debt different rates of exchange would
\ncome to be fixed at different times.\n<\/p>\n
     A further\tdifficulty in selecting the date of granting
\nan execution  application is  that execution  can only issue
\nfor a  sum expressed  in Indian\t currency. What\t is being is
\nexecuted is the decree and the sum for which execution is to
\nissue  in  a  money  decree  must,  therefore,\tbe  for\t the
\nparticular  sum\t specified  in\tthe  decree,  that  is,\t the
\njudgment debt.\tIt cannot  be  for  a  sum  which  would  be
\ndetermined and\tfixed by  the executing court at the time of
\ngranting the  execution application, for under o.21 r. 11(2)\n<\/p>\n
(g) of the Code of Civil Procedure, 1908, an application for
\nexecution has  to state\t “the amount  with interest (if any)
\ndue upon the decree”.\n<\/p>\n
     The above difficulties would rule out the taking of the
\ndate when  the court  grants an application for execution as
\nthe date of
\n572<\/span>
\nconversion and\twould make  inapplicable to  our courts\t the
\nrule laid down in the Miliangos case.\n<\/p>\n
     As regards\t the selection\tby the\tcourt of the date of
\npayment as  the proper date of conversion, that was the date
\ntaken in  the Schorsch\tMeier case;  but as Lord Wilberforce
\npointed out  (at page  468) in the Miliangos case, this only
\nmeans the  date when the court authorizes enforcement of the
\njudgment in  terms of sterling. As we have seen, in England,
\naccording to  the Practice  Directions\tdated  December\t 18,
\n1975, the  form of  the judgment  to be entered requires the
\ndefendant to  pay the  sterling equivalent  of\tthe  foreign
\ncurrency sum  adjudged at the time of payment. This would be
\nthe most  logical date\tand one\t which\tdoes  justice  to  a
\nplaintiff who  has come\t to court  to recover a sum of money
\npayable to him in a foreign currency. If the principle to be
\napplied is  that the  plaintiff should\tbe put\tin the\tsame
\nposition in  which he  would have  been\t had  the  defendant
\ndischarged  his\t obligation  on\t the  due  date,  then\tthat
\nprinciple is  best served  by the  court taking\t the date of
\npayment as the date of conversion. In adopting this date we,
\nhowever, find  ourselves  faced\t with  three  practical\t and
\nprocedural difficulties,  namely, payment of court-fees, the
\npecuniary limit of the jurisdiction of courts and execution.\n<\/p>\n
     So far  as court-fees  are concerned, we have a Central
\nAct, namely,  the Court-fees  Act, 1870 (VII of 1870), which
\napplies, either\t with or without amendments, to those States
\nand Union  Territories which  have not repealed and replaced
\nit  by\t their\town   legislation.  The\t  States  and  Union
\nTerritories which  have their own legislation on the subject
\nare Andhra  Pradesh, Gujarat,  Himachal Pradesh,  Jammu\t and
\nKashmir,  Karnataka,   Kerala,\t Maharashtra,\tPondicherry,
\nRajasthan, Tamil  Nadu and West Bengal. Under all Court-fees
\nActs, no plaint can be filed in any court without payment of
\ncourt fees. The plaintiff, therefore, has to value his claim
\nin the\tsuit and  pay the court-fees thereon computed in the
\nmanner provided\t in the\t relevant Court-fees  Act. So far as
\nmoney suits  are concerned,  the court-fees  payable are  ad
\nvalorem court-fees according to the amount claimed which may
\nor may\tnot be\tsubject to  a ceiling  depending upon  which
\nCourt-fees Act\tapplies. A suit for a sum of money expressed
\nin a foreign currency is also a money suit and the plaintiff
\nin such\t a suit will have to pay court-fees according to the
\namount claimed.\t As, however, a court in India cannot, as we
\nhave pointed  out  above,  pass\t a  decree  simpliciter\t for
\npayment of  a sum  in a foreign currency in such a suit, the
\nplaintiff will have to make an alternative
\n573<\/span>
\nclaim in  his plaint for the rupee equivalent of the foreign
\ncurrency sum claimed. He will, therefore, have to pay court-
\nfees on\t the amount  of the  rupee  equivalent.\t Such  rupee
\nequivalent as at the date of the institution of the suit can
\nonly be at the rate of exchange prevailing on that date. If,
\ntherefore, a plaintiff were to make the alternative claim on
\nthe basis  of the  rupee equivalent  at the time of payment,
\nthe value  of the  suit for the purposes of court-fees would
\nbe incapable  of computation for it would not be possible to
\nsay what  the rate of exchange on that date would be. It may
\nbe argued  on the  analogy of  a suit  for accounts  or\t for
\npartition or  for  administration  or  for  winding  up\t and
\naccounts of  a partnership  that the  plaintiff\t can  put  a
\ntentative valuation  in his plaint computed according to the
\nrate of\t exchange prevailing  on the date of the institution
\nof the\tsuit and  give an  undertaking to  pay\tthe  deficit
\ncourt-fees if  at the time of payment of the amount decreed,
\nthe rate  of exchange  has fluctuated  in his favour so that
\nthe amount  realized in\t rupee equivalent  is more  than the
\namount mentioned  in the  plaint. There is, however, a basic
\ndifference between  a money  suit and a suit for accounts, a
\npartition suit,\t an administration  suit  or  a\t partnership
\nsuit. In  these types  of suits,  a  preliminary  decree  is
\npassed to ascertain the amount due to the plaintiff and when
\nsuch  amount   is  ascertained,\t  a  final  decree  for\t the
\nascertained sum\t is passed.  In a money suit, however, there
\ncan be only one decree. It is, therefore neither permissible
\nin law nor feasible for the plaintiff in a suit in which his
\nclaim is for a sum of money in a foreign currency to give an
\nundertaking to\tmake good  the deficiency in court-fees when
\nhe receives  payment. In  fact, a  part or even the whole of
\nthe judgment  debt may\tnot be recovered at all. Even in the
\nother types  of suits  mentioned above,\t it is\tnot when the
\nascertained amount  is received\t by the\t plaintiff that\t the
\ndeficit court-fees  are to  be paid  by him.  They are to be
\npaid when the amount due to the plaintiff is ascertained. In
\nthe type  of suits  we are  concerned with in these appeals,
\nthe plaintiff  can at the highest give an undertaking to pay
\nthe deficit,  if any,  in the court-fees if at the time when
\nthe judgment  is given\tand the\t decree\t passed,  the  rupee
\nequivalent is more than at the date of the suit by reason of
\nthe fluctuation in the rate of exchange, but it would not be
\npermissible for him to give such an undertaking for any date
\nsubsequent to  the date\t of the\t passing of  the decree.  An
\nadditional difficulty would be that it is the court in which
\na suit\tis instituted which has to ensure at the time of the
\ninstitution of the suit that the proper court-fees have been
\npaid.  The   deficit  court-fees,   therefore,\t cannot\t  be
\ncalculated and the balance
\n574<\/span>
\nthereof recovered by the executing court. These difficulties
\nwould rule out both the date when the court orders execution
\nto issue  and the date of payment of the decretal debt to be
\ntaken as the date of conversion.\n<\/p>\n
     These difficulties\t do not\t arise in England. Under the
\nEnglish law, the Lord Chancellor has power, with the consent
\nof at  least three Judges of the Supreme Court of Judicature
\nand the concurrence of the Treasury, to fix fees to be taken
\nin the\tHigh Court  and the  Court of Appeal (see Halsbury’s
\nLaws of\t England, 4th  ed., vol.  10,  para.  908).  In\t the
\nexercise of  this power, Supreme Court Fees Orders have been
\nmade from  time to time. The order currently in force is the
\nSupreme Court  Fees Order,  1980 (S. I. 1980 No. 821), under
\nwhich the  fee payable in the case of a writ endorsed with a
\nclaim for a liquidated sum not exceeding & 2,000 is & 35 and
\nin any\tother case  it is & 40, civil proceedings in England
\nbeing commenced by issuing a writ. Thus, in England, a fixed
\ncourt-fee is  payable, the  amount thereof varying dependant
\nonly upon  whether it  is an action for a liquidated sum not
\nexceeding &  2,000 or  not. In\tEngland, therefore,  as\t the
\ncourt-fees payable  are not  ad\t valorem  court-fees  in  an
\naction to  recover a  sum of  money expressed  in a  foreign
\ncurrency, it  would be immaterial for the purposes of court-
\nfees whether  the plaintiff  claims in\tthe alternative\t the
\nsterling equivalent  of that  amount as\t at the\t date of the
\njudgment or  as at  the date  when the\tcourt gives leave to
\nenforce the judgment or as at the date of payment because in
\nany of\tthese cases, the court-fees payable by the plaintiff
\nwill not  vary except  where by reason of the fluctuation in
\nthe rate  of exchange  the amount adjudged or the amount for
\nwhich leave  to enforce\t the judgment is given or the amount
\npaid exceeds & 2,000 in a case where less than that has been
\nclaimed in  the action.\t It should  be\tnoted  that  English
\npractice also  recognizes  the\tdifficulty  which  would  be
\nencountered in issuing execution for a sum in sterling to be
\ndetermined  at\tthe  date  of  payment\tor  realization\t and
\naccordingly the Practice Directions dated December 18, 1975,
\nrequire\t that\twhere  a  plaintiff  desires  to  enforce  a
\njudgment, he  must mention  in the application made for that
\npurpose the  sterling equivalent of the foreign currency sum
\nadjudged calculated  at the  rate of  exchange prevailing on
\nthe date  nearest or  most nearly  preceding the date of the
\napplication for\t execution, and\t the writ of execution would
\nthen issue for such sterling equivalent.\n<\/p>\n
     So far as the limit of pecuniary jurisdiction of courts
\nis  concerned,\tunder  section\t15  of\tthe  Code  of  Civil
\nProcedure, 1908, every
\n575<\/span>
\nsuit is\t to be\tinstituted in  the court of the lowest grade
\ncompetent to  try it.  We have\tin India  a large  number of
\ncourts of  various grades with different pecuniary limits of
\njurisdiction. In  money suits,\tit is  the amount claimed in
\nthe suit  which will determine the particular court in which
\nthe suit  is to\t be instituted, This determination cannot be
\ndone with  reference to\t a foreign  currency. It can only be
\ndone  with   reference\tto   Indian  currency.\tThis  is  an
\nadditional reason  why thy plaintiff must in his plaint give
\nthe rupee  equivalent of the foreign currency sum claimed by
\nhim in\tthe suit  by converting it into Indian rupees at the
\nrate of\t exchange prevailing  at the date of the institution
\nof the suit.\n<\/p>\n
     The difficulty  with respect  to execution\t which would
\narise if the court were to select the date of payment as the
\ndate of\t conversion is\tthat  execution\t must  issue  for  a
\nspecific sum  expressed in  Indian currency  “due  upon\t the
\ndecree.” It  cannot issue  for\ta  sum\twhich  would  become
\nascertainable only  when realized  or paid  as would  be the
\ncase were execution to issue for the rupee equivalent at the
\ntime of\t payment  in  rupees  of  a  foreign  currency\tsum.
\nFurther, as  pointed our  earlier, execution  can issue only
\nwith respect to the amount due upon the decree.\n<\/p>\n
     For the  above reasons,  it is  not possible  for us to
\naccept the  date of  payment or\t realization of the decretal
\ndebt as the proper date for the rate of conversion.\n<\/p>\n
     This then leaves us with only there dates from which to
\nmake our  selection, namely, the date when the amount became
\npayable, the  date of the filing of the suit and the date of
\nthe judgment,  that is,\t the date  of passing the decree. It
\nwould be  fairer to  both the  parties for the court to take
\nthe latest  of these  dates, namely, the date of passing the
\ndecree, that is, the date of the judgment.\n<\/p>\n
     The learned  Single Judge\tof the Delhi High Court also
\nreached the  same conclusion.  He, however,  did so  relying
\nupon the  Miliangos case under an erroneous belief that when
\nin that\t case it was held that the proper date should be the
\ndate when  the judgment\t becomes enforceable  what was meant
\nwas the\t date when the judgment was given, that is, when the
\ndecree was  passed. The learned Single Judge was in error in
\nso reading  the judgment  of the  House of  Lords. when\t the
\nmajority in  the Miliangos  case spoke\tof the date when the
\ncourt gives leave to enforce the judgment what they were
\n576<\/span>
\nreferring to  was not  the date of the judgment but the date
\non which  the court  gives leave to execute the judgment. In
\nHalsbury’s Laws\t of England  (4th ed, vol. 17, para 401) the
\nword ‘execution’ is defined as follow:\n<\/p>\n
\t  “The\tword   ‘execution’  in\t its  widest   sense
\n     signifies the  enforcement of  or giving  effect to the
\n     judgments or orders of courts of justice. In a narrower
\n     sense, it\tmeans the  enforcement of those judgments or
\n     orders by\ta public  officer under\t the writs  of fieri
\n     facias,  possession,   delivery,  sequestration,  fieri
\n     facias de bonis ecclesiasticis, etc.” (The emphasis has
\n     been supplied by us.)
\n     This definition  also appeared  in the Third Edition of
\nHalsbury’s Laws\t of England  and was  cited with approval by
\nHewson J. in The Zafiro, John Carllon & Co. Ltd v. Owners of
\nS.S. Zafiro.(1)\t The most  usual method\t of enforcement of a
\nmoney judgment\tin  England  is\t by  writ  of  fieri  facial
\ncommonly called\t fi.fa. (see Halsbury’s Laws of England, 4th
\ned., vo,  17, para.  462).  In\tcertain\t cases,\t a  writ  of
\nexecution to  enforce  a  judgment  or\torder  cannot  issue
\nwithout leave of the court. It is unnecessary to go into the
\ndetails of  the procedure  relating to\texecution in England
\nfor what  we have  stated above\t is sufficient\tto show that
\nwhat the  majority in  the Miliangos  case meant by the date
\nwhen the  court gives  leave to\t enforce the judgment or the
\ndate when  the court  authorizes enforcement of the judgment
\nwas the\t date when  the court  gives leave  to\texecute\t the
\njudgment.<\/p><\/blockquote>\n
     Does the  fact that the decree sought to be executed is
\none passed  in terms  of an award which directs payment of a
\nsum of\tmoney in  a foreign  currency make any difference to
\nthe date  of conversion\t to  be\t selected  by  the  court  ?
\nAccording to  the Division  Bench of the Delhi High Court it
\ndoes because,  relying upon  the Jugoslavenska case, it held
\nthat in\t such a\t case the  proper date for conversion of the
\nforeign currency  sum awarded would be the date of the award
\nin as  much as\tthere was no difference between the relevant
\nprovisions of  the English  Arbitration Act, 1950 (14 Geo 6,
\nc.27),\tand   our  Arbitration\t Act,  1940   (X  of  1940),
\nparticularly section 26(1) of the English Act and section 17
\nof our Act. For reasons which we will presently set out, the
\nDivision Bench\tof the\tDelhi High  Court erred\t in reaching
\nthis conclusion.\n<\/p>\n
577<\/span><\/p>\n
     We have  set out earlier the facts of the Jugoslavenska
\ncase and  have\textracted  the\trelevant  passage  from\t the
\njudgment of  Lord  Denning  M.R.  To  recapitulate,  in\t the
\nJugoslavenska case,  the plaintiffs  had been  awarded a sum
\nexpressed in United States dollars in an arbitration held in
\nLondon and  had sought\tleave of the court under section 26,
\nnow section  26(1), of the Arbitration Act, 1950, to enforce
\nthat award.  In support\t of this application, the plaintiffs
\nhad filed  an affidavit\t showing the  rate of exchange as at
\nthe date  of the  award and the equivalent in pound sterling
\nat that rate of the amount awarded to him and had claimed to
\nenforce the  amount awarded  on that  basis. Two  questions,
\ntherefore, fell\t for the  court’s determination.  They\twere
\nthus put  by Roskill  L.J. in  his judgment in that case (at
\npage 504):\n<\/p>\n
\t  “The first  is whether  an  arbitrator  or  umpire
\n     sitting in\t England or Wales can lawfully make an award
\n     in a  currency  other  then  sterling.  The  second  is
\n     whether if such an award can be so lawfully made, it is
\n     enforceable under s. 26.<\/p><\/blockquote>\n
     To understand  the decision  of the  Court of Appeal so
\nfar as concerns the first question, we must bear in mind the
\nthen prevailing\t state of  the law  in England and so far as
\nconcerns the  second question  the provisions of the English
\nlaw relating  to enforcement of awards. At that time the old
\nrule affirmed  by the  House of Lords in the Havana case was
\nthe law.  Under it an English court could give judgment only
\nin English currency and in an action in England to recover a
\ndebt expressed\tin a  forcing currency,\t such debt had to be
\nconverted in  to sterling at the rate of exchange prevailing
\non the\tdate when  the debt  was  payable.  So\tfar  as\t the
\nprovisions of  English law  relating to\t enforcement  of  an
\naward are concerned, the mode would depend whether or not it
\nwas a  foreign\taward  as  defined  in\tsection\t 35  of\t the
\nArbitration Act,  1950, which definition is mutatis mutandis
\nthe same  as the  definition of\t “foreign  award”  given  in
\nsection 2  of our Arbitration (Protocol and Convention) Act,
\n1937   (VI of  1937). Sub-section  (1) of  section 36 of the
\nEnglish Act provides for enforcement of foreign awards. That
\nsection is in the following terms:\n<\/p>\n
     “36. Effect of foreign awards.-\n<\/p><\/blockquote>\n
     (1)  A foreign  awards shall, subject to the provisions
\n\t  of this  Part\t of  this  Act,\t be  enforceable  in
\n\t  England
\n578<\/span>
\n\t  either by  action or\tin the\tsame manner  as\t the
\n\t  award of an arbitrator is enforceable by virtue of
\n\t  section twenty-six of this Act.\n<\/p><\/blockquote>\n
     (2)  Any foreign award which would be enforceable under
\n\t  this Part  of this Act shall be treated as binding
\n\t  for all purposes on the persons as between whom it
\n\t  was made,  and may accordingly be relied on by any
\n\t  of those  persons by\tway of\tdefence, set  off or
\n\t  otherwise in any legal proceedings in England, and
\n\t  any  references  in  this  Part  of  this  Act  to
\n\t  enforcing a  foreign award  shall be\tconstrued as
\n\t  including references to relying on an award.”<\/p><\/blockquote>\n
     Though section 36 is headed ‘Effect of foreign awards’,
\nit will\t be seen  that sub-section (1) of that section deals
\nwith enforcement  of foreign  awards while  only sub-section
\n(2) deals  with the  effect of\tforeign awards.\t Thus, under
\nsection 36  (1) there are two alternative modes provided for
\nenforcing a  foreign award in England, namely, (1) by action
\nat law\ton the\taward, and  (2) by leave of the court in the
\nsame manner as the award of an arbitrator made in England is
\nenforceable under  section 26.\tSince, according  to the law
\nthen prevailing,  an English  court could only give judgment
\nin sterling  and   required a  debt expressed  in a  foreign
\ncurrency to  be converted  into English currency at the rate
\nof exchange prevailing on the date when the debt was payable
\nin an  action on a foreign award the plaintiff would have to
\nmake his  claim in English currency in respect of the sum of
\nmoney awarded  to him  in a  foreign currency.\tIn  such  an
\naction the  debt in  respect of which the plaintiff would be
\nseeking judgment  would be  the sum  of money payable to him
\nunder the  award which\thad by\tvirtue of  the award  become
\npayable\t to  him  on  the  date\t of  the  award.  He  would,
\ntherefore, have\t to convert the foreign currency sum awarded
\nto him\tinto  English  currency\t at  the  rate\tof  exchange
\nprevailing on the date of the award.\n<\/p>\n
     Before we\tdeal with  the second  mode of\tenforcing  a
\nforeign\t award\t provided  in  section\t36(1),\tit  will  be
\nconvenient to reproduce here the provisions of section 26 of
\nthe English Arbitration Act which are as follows:\n<\/p>\n
     “26. Enforcement of award.-\n<\/p><\/blockquote>\n
     (1)  An award on an arbitration agreement may by, leave
\n\t  of the  High Court or a judge thereof, be enforced
\n\t  in
\n579<\/span>
\n\t  the same manner as a judgment or order to the same
\n\t  effect, and  where leave is so given, judgment may
\n\t  be entered in terms of the award.\n<\/p><\/blockquote>\n
     (2)  If-\n<\/p><\/blockquote>\n
\t  (a)  the amount  sought to  be recovered  does not
\n\t       exceed the  current limit  on jurisdiction in
\n\t       section 40  of the  County Courts  Act, 1959,
\n\t       and\n<\/p><\/blockquote>\n
\t  (b)  a  county   court  so  orders,  it  shall  be
\n\t       recoverable (by\texecution  issued  from\t the
\n\t       county court  or\t otherwise)  as\t is  payable
\n\t       under an order of that court and shall not be
\n\t       enforceable under sub-section (1) above.
\n     (3)  An  application  to  the  High  Court\t under\tthis
\n\t  section shall\t preclude an application to a county
\n\t  court and  an application  to a county court under
\n\t  this section\tshall preclude an application to the
\n\t  High Court.”<\/p><\/blockquote>\n
     Originally section\t 26 consisted  only  of\t sub-section
\n(1). Subsection\t (2) and (3) were inserted in section 26 and
\nthe  original  section\trenumbered  as\tsub-section  (1)  by
\nsection 17(2)  of the  Administration of  Justice Act, 1977.
\nThe new\t sub-sections (2)  and (3)  are immaterial  for\t our
\npurpose for  it was  the old  section 26, now section 26(1).
\nwhich formed  the basis of the decision in the Jugoslavenska
\ncase.\n<\/p>\n
     Kerr  J.,\t from  whose  judgment\tthe  appeal  in\t the
\nJugoslavenska ease  was carried\t to the Court of Appeal, had
\nbefore deciding\t the matter  made enquiries  of the  Central
\nOffice of  the High Court as to the practice in dealing with
\napplications  under  section  36(1).  Roskill  L.J.  in\t his
\njudgment in the Court of Appeal has referred to this and has
\nthus set out (at page 507) the information which Kerr J. had
\nreceived:\n<\/p>\n
\t  “He was  told that  the practice  on\tapplications
\n     under that\t section is  that the  sum  awarded  in\t the
\n     foreign currency in question is converted into sterling
\n     at the  rate prevailing  at the  date of  the award and
\n     that, in  the absence  of any other objection, an order
\n     is then  made giving leave to enforce the foreign award
\n     in the  same manner  as a\tjudgment for  that resulting
\n     sterling sum.”<\/p><\/blockquote>\n
     (The emphasis has been supplied by us.)
\n580<\/span>
\n     The award\tin the\tJugoslavenska case was not a foreign
\naward within  the meaning  of section  35 of the English Act
\nfor it\twas made  in England,  though the  sum awarded there
\nunder was  expressed in\t a foreign  currency, namely, United
\nStates dollars. In English law, an application to enforce an
\naward under  section 26(1)  is only  one  of  the  modes  of
\nenforcing an  award which is not a foreign award. Where such
\nan application is granted, it is not necessary that judgment
\nmust be entered in terms of the award. Lord Denning M.R., in
\nthe course  of\this  judgment  in  the\tJugoslavenska  case,
\npointed out  (at page  502) that  in most  cases it would be
\nunnecessary to enter judgment, for once leave was given, the
\naward could  be enforced by the ordinary means of execution,
\nbut it\tmight be  necessary to\tenter judgment\tin order  to
\nissue a bankruptcy notice and the latter words of section 26
\nenabled judgment  to be so entered. Roskil L.J. also pointed
\nout (at\t page 507)  that under\tsection 26(1)  there are two
\ndifferent steps which must be taken. First, the obtaining of
\nleave to enforce the award in the same manner as a judgment,
\nand secondly  and independently, when leave is so given, the
\nentering of judgment in the terms of the award.\n<\/p>\n
     Section 26(1)  is not  exhaustive of the modes in which
\nan award,  which is  not a  foreign award,  can be enforced.
\nSuch an\t award can also be enforced by bringing an action on
\nit in which case, as pointed out earlier, if the sum awarded
\nwere expressed\tin a  foreign currency,\t the judgment  would
\nhave to\t be sought in sterling for which purpose the rate of
\nexchange would\tbe taken as at the date of the award. In the
\nJugoslavenska case  the court  held that  an  arbitrator  or
\numpire in  England had\tjurisdiction to\t make an award for a
\nsum of\tmoney expressed\t in a  foreign\tcurrency  when\tthat
\nparticular currency was the appropriate currency in which to
\nexpress it.  The difficulty  which faced  the court  was the
\nmanner of  enforcing such an award by reason of the decision
\nin the\tHavana case  under which an English court could give
\njudgment only  in sterling.  This difficulty was resolved by
\nthe court  by referring to section 36(1) and holding that it
\nwould be  unreasonable that  an award  in a foreign currency
\nmade aboard  could  be\tenforced  by  an  application  under
\nsection 26(1)  while the  same award,  if made\tin  England,
\ncould not  be so  enforced. It\twas for this reason that the
\ncourt interpreted  the words  “to the same effect” occurring
\nin section 26(1) as meaning “having the same effect” and not
\nas meaning  “in the  same terms”,  because, as\tLord Denning
\nM.R. pointed  out, if  it were\tto be  so interpreted, there
\nwould be some difficulty in applying the section to an award
\nin a  foreign currency\tbut if the words were interpreted to
\nmean that the judgment
\n581<\/span>
\nor order  must have  “the same effect”, it would follow that
\nif the\tsum awarded were converted into sterling at the rate
\nof exchange  as at  the date  of the award it would have the
\nsame effect  as a  judgment or\torder in  an action  on\t the
\naward. We may point out that Cairns L.J., however, felt some
\ndoubt  whether\tthe  sum  awarded  must\t be  converted\tinto
\nsterling before\t leave to enforce the award was given but he
\ndid not\t dissent because  both Lord Denning M.R. and Roskill
\nL.J.  considered   that\t it   should  be  so  converted.  As
\nemphasized by us earlier, in the Jugoslavenska case the date
\nof the\taward was taken as the date of conversion because in
\nan action  on such  an award the due date for payment of the
\ndebt would  be the  date of  the award. We have seen that in
\nthe Miliangos  case, though  the Jugoslavenska\tcase was not
\nexpressly over-ruled  none of the Law Lords who had occasion
\nto refer  to it\t were happy  with what\thad been held there;
\nLord Wilberforce  opining that\tthere was  no reason why, if
\ndesired, the practice should not be adjusted so as to enable
\nconversion to  be made at the date when leave to enforce the
\naward in  sterling is  given; Lord Cross of Chelsea thinking
\nit absurd  that there  should be  one rule  for arbitrations
\nwith respect  to foreign  currency debts  and  another\twith
\nrespect to  actions on\tsimilar\t debts;\t Lord  Edmund-Davies
\nexpressing his view that no basic distinction could be drawn
\nfor the\t purposes of a conversion date between judgments and
\nawards; and  even Lord\tSimon of Glaisdale in his dissenting
\njudgment stating  his belief  that  if\tParliament  were  to
\nreconsider the\tsterling judgment  rule and  the breach date
\nrule, the  Jugaslavenska case  would come within the purview
\nof such\t reconsecration. In  view of  these observations and
\nthe fact  that the  Havana case is no longer the law in view
\nof the decision in the Miliangos case, it is highly doubtful
\nwhether today  in England if the matter were carried higher,
\nit would  be decided  in  the  same  way.  In  view  of\t the
\nMiliangos case\tit cannot be said today that in an action on
\nan award  the foreign currency sum directed to be paid under
\nthe award must be converted at the date of the award when it
\nwas payable.  It would have to be converted at the date when
\nthe court  gives leave to enforce the judgment. On principle
\nthere can be no difference between an action on an award and
\na case where instead of filing an action the plaintiff files
\nan application\tunder section 26(1) for leave to enforce the
\naward. If  in an  action on  the award\tthe proper  date  of
\nconversion would  be the  date when the court gives leave to
\nenforce the  judgment, where  an application  under  section
\n26(1) is  filed the proper date of conversion should also be
\nthe same, for then alone can the award, when leave is given,
\n“be enforced  in the  same manner  as a judgment or order to
\nthe same effect”.\n<\/p>\n
582<\/span><\/p>\n
     We find that the Division Bench of the Delhi High Court
\nhas not\t correctly appreciated\tthe ratio of the decision in
\nthe Jugoslavenska  case nor  the reasoning  upon which\tthat
\ndecision was  based. We also find that the Division Bench of
\nthe Delhi  High Court  has committed  an error\tin  equating
\nsection 26(1) of the English Arbitration Act with section 17
\nof our\tArbitration Act.  The reason  for this error is that
\nthe Division  Bench of\tthe Delhi  High Court  has proceeded
\nupon a\twrong assumption  that the  procedural scheme of the
\nEnglish\t Arbitration   Act  is\tthe  same  as  that  of\t our
\nArbitration Act.  In this connection, the Division Bench has
\nreferred to  section 22\t of the English Act, under which the
\ncourt has  power from  time to\ttime to\t remit\tthe  matters
\nreferred  or   any  of\t them  for  reconsideration  of\t the
\narbitrator or  umpire, and section 23(1) of the English Act,
\nunder which  the court has power to remove any arbitrator or
\numpire for misconduct. These sections correspond to sections
\n16 and\t11 our\tAct, We fail to see what relevance either of
\nthese sections\thad to\tthe question  in  issue.  Before  we
\nproceed further\t to discuss this aspect of the case, it will
\nbe convenient  to set out section 17 of our Arbitration Act,
\n1940. That section provides as follows:\n<\/p>\n
\t  “17. Judgment in terms of award.-\n<\/p><\/blockquote>\n
\t  Where the  Court sees\t no cause to remit the award
\n     or any  of the  matters  referred\tto  arbitration\t for
\n     reconsideration or\t to set\t aside the  award, the Court
\n     shall, after  the time for making an application to set
\n     aside the award has expired, or such application having
\n     been made,\t after refusing\t it,  proceed  to  pronounce
\n     judgment according\t to the award, and upon the judgment
\n     so pronounced a decree shall follow and no appeal shall
\n     lie from such decree except on the ground that it is in
\n     excess of,\t or not\t otherwise in  accordance with,\t the
\n     award.”<\/p><\/blockquote>\n
     What seems\t to have impressed the Division Bench of the
\nDelhi High  Court is  the fact\tthat in England the court is
\nnot bound  to grant leave to enforce the award but can, when
\nsuch an\t application is\t made, on  objection being raised by
\nthe respondent,\t either remit the award or set it aside, and
\nthat the  same can  also be done by a court in India when an
\naward has been filed in court. We find that in adopting this
\nline of approach the Division Bench has overlooked the basic
\ndifferences between  the English procedure and the procedure
\nunder our  Act. The  provisions for enforcing an award under
\nthe
\n583<\/span>
\nEnglish Act  and under\tour Act\t are  different.  Under\t the
\nEnglish Act,  if it  is sought to enforce an award by making
\nan application\tunder section 26(1), such application has to
\nbe made\t under O. 73 r. 3 of the Rules of the Supreme Court,
\n1965, by  an originating  summons. There  is  no  time-limit
\nprovided for taking out such a summons. There is, however, a
\ntime-limit provided  for making\t an application to the court
\nto remit  an award under section 22 or to set aside an award
\nunder section 23(2), under O. 73 r. 5(1) of the Rules of the
\nSupreme Court,\t1965, the period of limitation being 21 days
\nafter the  award has been made and published to the parties.
\nAn application\tfor leave to enforce the award under section
\n26(1) can,  however, be\t made even  before the expiry of the
\ntime for  moving to  set aside\tthe award.  In such  a case,
\nhowever, it can be resisted upon the ground that a motion to
\nset aside  the award  to be  made. It is opined in Russel on
\nArbitration, 20th  ed. page  375, that\tin such\t a case, the
\nparty resisting\t the application  would be required to show,
\nupon  affidavit,  a  substantial  case\tfor  contesting\t the
\nvalidity of  the award, as well as to swear to his intention
\nof doing so. Under section 17 of our Act, an application for
\na judgment according to the award can only be made after the
\ntime for  making an  application to  set aside the award has
\nexpired, or if such application has been made, only after it
\nis refused. Under the English Act, the court is not bound to
\ngrant leave  to enforce,  the award.  In doubtful  cases, it
\nwould ordinarily  leave the  party to  pursue his  remedy by
\nfiling an action on the award. The court may also give leave
\nto enforce the award only upon terms. An instance of this is
\nthe case  of E.D.  & F, Man v. Societe Annonyme Triaolitaine
\nDes Usines De Raffinage De Sucre(1) where the applicant, who
\nhad throughout\tadmitted that  he owed\ta certain  sum on  a
\ncross-claim,  which   was  not\t a  subject-matter   of\t the
\nreference, was\tawarded a larger sum which made no reference
\nto the\tcross-claim, was  given leave  to enforce  the whole
\naward as a judgment on an undertaking given by him to accept
\nthe difference\tbetween the  two sums in satisfaction of the
\naward and  the extinction  of the  cross-claim. Further,  in
\nanswer to  an application  for leave under section 26(1) the
\nrespondent may\tset up\tthe defence  that  the\taward  is  a
\nnullity, or  is wholly\tor in part ultra vires, or is bad on
\nthe face  of it.  If, however, his objection to the award is
\nthat arbitrator\t has misconducted himself, or that the award
\nwas improperly\tprocured, his proper course would be to move
\nto set the award aside, and, if necessary, to have the
\n584<\/span>
\napplication to\tenforce the  award adjourned in the meantime
\n(see Halsbury’s Laws of England, 4th ed., vol. 2, para 630).
\nNone of\t these contentions  are available  to  a  respondent
\nwhere an  application for  a judgment according to the award
\nis made\t under section 17 of our Arbitration Act, 1940. They
\ncan only  be raised by way of an application to set aside or
\nremit the  award after the award has been filed in court and
\nnotice thereof issued to the parties under section 14 of the
\nArbitration Act,  1940. The period of limitation for such an
\napplication  is\t  prescribed  by   Article  119(b)   of\t the
\nLimitation Act,\t 1963 (XXXVI  of 1963).\t If  the  period  of
\nlimitation expires  without any such application being made,
\nthe court,  on application made to it for that purpose, must
\nproceed to  “pronounce\tjudgment  according  to\t the  award”
\nwhereupon a  decree has\t to  follow.  Section  17  expressly
\nprovides that in such a case “the Court shall … proceed to
\npronounce judgment  according to  the  award  and  upon\t the
\njudgment so  pronounced a  decree shall\t follow”.  The\tonly
\nground upon  which such a decree can be challenged in appeal
\nis that\t “it is in excess of, or not otherwise in accordance
\nwith the  award”. The  court before which an application for
\njudgment in  terms of  the award is made, has, therefore, no
\ndiscretion in the matter except possibly in a case where the
\naward is  on the face of it patently illegal or violative of
\na provision  of the  law. Under section 26(1) of the English
\nAct, when  leave is  given to  enforce the  award, it is not
\nnecessary that\tjudgment should\t be entered  in terms of the
\naward for  the purpose\tof enforcing the award by execution.
\nUnder our  Arbitration Act, before an award can be enforced,
\na judgment  has to  be pronounced  according to the award, a
\ndecree has  thereupon to  follow and it is that decree which
\nalone can  be enforced\tby an application for execution made
\nunder O. 21 r. 11 of the Code of Civil Procedure, 1908.\n<\/p>\n
     It is  pertinent to  note that  the judgment, which the
\ncourt pronounces  under section\t 17, is\t to be “according to
\nthe award”.  Where the\taward directs a certain sum of money
\nto be  paid and\t the court,  in a  case\t where\tit  has\t not
\nmodified or corrected the award under section 15, pronounces
\njudgment for a different sum, the judgment cannot be said to
\nbe “according to the award”. In the same way, where an award
\ndirects payment\t of a sum of money in a foreign currency and
\nthe court  while pronouncing judgment provides for its rupee
\nequivalent at the rate of exchange prevailing on the date of
\nthe award,  the\t court\twill  not  be  pronouncing  judgment
\n“according to  the award”  if in  the meantime\tthe rate  of
\nexchange has varied, because at the date of the judgment the
\nforeign currency equivalent of the
\n585<\/span>
\namount in rupees provided in the judgment would be different
\nfrom the  foreign currency  sum directed  to be\t paid by the
\naward. The  judgment, therefore,  can only  be\tsaid  to  be
\n“according to  the award” if it directs payment of the rupee
\nequivalent at the rate of exchange prevailing on the date of
\npronouncing the\t judgment which date is the same as the date
\nof  the\t passing  of  the  decree.  For\t this  purpose,\t the
\napplicant must\tsatisfy the  court, either  on affidavit  or
\notherwise, as to the rate of exchange prevailing on the date
\nof the\tjudgment or  on the  date  nearest  or\tmost  nearly
\npreceding the date of the judgment.\n<\/p>\n
     Under section 17 of our Arbitration Act, judgment is to
\nbe pronounced “according to the award”. The marginal note to
\nthe section  speaks of\t“judgment in  terms of award”. Under
\nsection 26(1)  of the  English Act,  once leave is given, an
\naward becomes  enforceable in  the same manner as a judgment
\nor order  “to the  same effect”.  The  words  “to  the\tsame
\neffect” were  interpreted in  the jugoslavenska\t case not as
\nmeaning “in  the same terms” but as meaning having “the same
\neffect”, that is, as having the same effect as a judgment or
\norder given  in an  action brought  on the  award.  Granting
\nleave under section 26(1) of the English Act and pronouncing
\njudgment according  to the  award and passing a decree under
\nsection 17  of our Act, therefore, mean different things and
\nhave different\tresults. A  judgment according\tto the award
\nunder section  17 our  Act will\t speak only from the date of
\nthe judgment which will not be the case under section 26(1),
\nfor while  in the first case what will be enforceable by the
\nprocesses of  law, namely,  execution, will  be\t the  decree
\npassed in  terms of the award, in the second case it will be
\nthe award  itself, unless  the\tapplicant  desires  to\thave
\njudgment entered  in terms  of the  award which\t he  is\t not
\nrequired to do as pointed out above.\n<\/p>\n
     On behalf of ONGC reliance was placed upon the decision
\nof this\t Court in  Satish Kumar and others v. Surinder Kumar
\nand others<\/a>.(1)\tOn the\tstrength of  this  decision  it\t was
\nsubmitted that\tan award  was not a mere waste paper until a
\ndecree in  terms of  the award\thas been passed but an award
\ncreated rights\tand liabilities\t and, therefore,  since\t the
\naward in the instant case provided that a certain sum should
\nbe paid\t in a foreign currency to Forasol, it spoke from the
\ndate when  it  was  made  and  published  and  the  rate  of
\nconversion could,  therefore, only  be the  date of the said
\naward. We  are unable  to see  how the above decision in any
\nway bears out this proposition or lends support
\n586<\/span>
\nto it  In that\tcase, an  award,  made\ton  a  reference  to
\narbitration by\tthe parties  without the intervention of the
\ncourt,\twas   filed  in\t  court\t under\tsection\t 14  of\t the
\nArbitration Act,  1940. In an application made under section
\n30 to  set aside  the award, one of the objections taken was
\nthat  the   award  required   registration  as\tit  affected
\nimmovable property  worth more\tthan Rs.100  in value and as
\nthe award  was not  registered, it  was\t not  admissible  in
\nevidence. This contention was upheld. It was in this context
\nthat this  Court observed  (at page  249) that “an award has
\nsome legal force and is not a mere waste paper. If the award
\nin question  is not  a mere  waste paper  but has some legal
\neffect it plainly purports to or affects property within the
\nmeaning of  s. 17  (1) (b)  of the  Registration  Act”.\t The
\nquestion before\t the Court in that case was whether a decree
\nin terms  of an\t unregistered award  could be  passed by the
\ncourt in  a case where under the Registration Act, 1908 (XVI
\nof 1908), the registration of the award was compulsory. This
\nquestion is  very different from the one which we are called
\nupon to decide.\n<\/p>\n
     It was  also submitted on behalf of ONGC that an award,
\nunless it is set aside by the court, is a final adjudication
\nof the\trights and  liabilities of the parties in respect of
\nthe matters  referred to arbitration and, therefore, Forasol
\ncould not claim to convert the French Franc part of the said
\naward into  Indian rupees at the rate of exchange prevailing
\non the\tdate of the decree but can only do so at the rate of
\nexchange prevailing  on the  date of the award. We find this
\nsubmission wholly  untenable. Undoubtedly,  the said  award,
\nnot having been set aside or modified by the court, is final
\nand binding  on the  parties and,  in respect of the matters
\nreferred to  arbitration, Forasol  cannot claim\t any  amount
\nfrom ONGC other than that awarded by the Umpire. Forasol is,
\nhowever, not  making any such claim. It is claiming only the
\nsum in French Francs which it has become entitled to receive
\nfrom ONGC  under the  said award.  All that Forasol wants is
\nthat ONGC should pay to it the sum of FF. 5,89,727.51 due to
\nit under  the said  award or  its rupee equivalent as at the
\ndate when  the court  pronounced judgment  according to\t the
\nsaid award and passed the decree in terms thereof. This is a
\nvery different\tthing from  making a  claim de hors the said
\naward. The  claim made\tby Forasol is actually one under the
\nsaid award for if the sum awarded to it in French Francs was
\nnot paid  or could  not be  paid by  ONGC, Forasol  would be
\nentitled to  receive its  rupee equivalent.  On\t the  decree
\nbeing passed  in terms\tof the\tsaid award  the\t said  award
\nbecame\tmerged\t in  the   said\t decree\t  and  the   sum  of
\nFF,5,89,727.51 payable to Forasol under
\n587<\/span>
\nthe said  award became\ta judgment  debt payable  to Forasol
\nunder the said decree and, as pointed out above, at the time
\nof passing the decree the court would have to direct payment
\nof the\trupee equivalent  of this foreign currency debt only
\nat the\trate of\t exchange prevailing  on  the  date  of\t the
\ndecree.\n<\/p>\n
     For the  reasons set  out above,  we are of the opinion
\nthat the rule in the jugoslavenska case cannot be applied to
\nthis country  and the  fact that  a decree is in terms of an
\naward for  a sum  of money  expressed in  a foreign currency
\nmakes no difference to the date to be taken by the court for
\nconverting into\t Indian currency  the foreign  currency\t sum
\ndirected to  be paid  under the\t award and  that  such\tdate
\nshould also be the date of the decree.\n<\/p>\n
     It would  be convenient if we now set out the practice,
\nwhich according\t to us,\t ought to  be followed\tin suits  in
\nwhich a\t sum of\t money expressed  in a\tforeign currency can
\nlegitimately be\t claimed by the plaintiff and decreed by the
\ncourt. It  is unnecessary  for us to categorize the cases in
\nwhich such  a claim  can be made and decreed. They have been
\nsufficiently indicated\tin the English decisions referred to
\nby us above. Such instances can, however, never be exhausted
\nbecause\t the  law  cannot  afford  to  be  static  but\tmust
\nconstantly develop  and progress  as the society to which it
\napplies, changes  its  complexion  and\told  ideologies\t and
\nconcepts are  discarded and  replaced by  new. Suffice it to
\nsay that  the case with which we are concerned was one which
\nfell in\t this category.\t In such  a suit, the plaintiff, who
\nhas not received the amount due to him in a foreign currency
\nand, therefore,\t desires to seek the assistance of the court
\nto recover  that amount, has two courses open to him. He can
\neither claim  the amount due to him in Indian currency or in
\nthe foreign  currency in which it was payable. If he chooses
\nthe first  alternative, he  can only  sue for that amount as
\nconverted into\tIndian rupees  and his\tprayer in the plaint
\ncan only  be for a sum in Indian currency. For this purpose,
\nthe plaintiff  would have  to convert  the foreign  currency
\namount due to him into Indian rupees. He can do so either at
\nthe rate  of exchange prevailing on the date when the amount
\nbecame payable\tfor he was entitled to receive the amount on
\nthat date  or, at  his\toption,\t at  the  rate\tof  exchange
\nprevailing on  the date\t of the\t filing of  the suit because
\nthat is\t the date  on which  he is seeking the assistance of
\nthe court  for recovering  the amount  due to him. In either
\nevent, the  valuation of the suit for the purposes of court-
\nfees and the pecuniary limit of the jurisdiction
\n588<\/span>
\nof the\tcourt will  be the amount in Indian currency claimed
\nin the\tsuit. The  plaintiff may, however, choose the second
\ncourse open  to him and claim in foreign currency the amount
\ndue to\thim. In\t such a\t suit, the  proper  prayer  for\t the
\nplaintiff to  make in  his plaint would be for a decree that
\nthe defendant do pay to him the foreign currency sum claimed
\nin the\tplaint subject\tto the\tpermission of  the concerned
\nauthorities under the Foreign Exchange Regulation Act, 1973,
\nbeing granted  and that in the event of the foreign exchange
\nauthorities not\t granting the  requisite permission  or\t the
\ndefendant not  wanting to  make payment\t in foreign currency
\neven  though   such  permission\t has  been  granted  or\t the
\ndefendant not  making payment  in  foreign  currency  or  in
\nIndian rupees,\twhether such  permission has been granted or
\nnot, the  defendant  do\t pay  to  the  plaintiff  the  rupee
\nequivalent of  the foreign  currency sum claimed at the rate
\nof exchange  prevailing on the date of the judgment. For the
\npurposes  of   court-fees  and\tjurisdiction  the  plaintiff
\nshould, however,  value his  claim in the suit by converting
\nthe foreign  currency sum  claimed by him into Indian rupees
\nat the rate of exchange prevailing on the date of the filing
\nof the\tsuit or\t the date  nearest or  most nearly preceding
\nsuch date,  stating in his plaint what such rate of exchange
\nis. He should further give an undertaking in the plaint that
\nhe would make good the deficiency in the court-fees, if any,
\nif at the date of the judgment, at the rate of exchange then
\nprevailing, the rupee equivalent of the foreign currency sum
\ndecreed is  higher than that mentioned in the plaint for the
\npurposes of  court-fees and  jurisdiction. At the hearing of
\nsuch a\tsuit, before  passing the  decree, the\tcourt should
\ncall upon  the plaintiff  to  prove  the  rate\tof  exchange
\nprevailing on  the date\t of the\t judgment  or  on  the\tdate
\nnearest or  most nearly\t preceding the date of the judgment.
\nIf necessary, after delivering judgment on all other issues,
\nthe court  may stand  over the\trest of the judgment and the
\npassing of  the decree\tand adjourn the matter to enable the
\nplaintiff to  prove such  rate of exchange. The decree to be
\npassed by the court should be one which orders the defendant
\nto pay to the plaintiff the foreign currency sum adjudged by
\nthe  court  subject  to\t the  requisite\t permission  of\t the
\nconcerned authorities  under the Foreign Exchange Regulation
\nAct, 1973,  being granted,  and in  the event of the Foreign
\nExchange authorities  not granting  the requisite permission
\nor the\tdefendant not  wanting to  make payment\t in  foreign
\ncurrency even though such permission has been granted or the
\ndefendant not  making payment  in  foreign  currency  or  in
\nIndian rupees,\twhether such  permission has been granted or
\nnot, the  equivalent of\t such foreign currency sum converted
\ninto
\n589<\/span>
\nIndian rupees  at the  rate of\texchange proved\t before\t the
\ncourt as  aforesaid.  In  the  event  of  the  decree  being
\nchallenged in appeal or other proceedings and such appeal or
\nother proceedings  being decided  in whole  or\tin  part  in
\nfavour of  the plaintiff,  the appellate  court or the court
\nhearing the application in the other proceedings challenging
\nthe decree  should follow  the same  procedure as  the trial
\ncourt for  the purpose\tof ascertaining the rate of exchange
\nprevailing on  the date\t of its\t appellate decree  or of its
\norder on  such application  or on  the date  nearest or most
\nnearly preceding  the date  of such decree or order. If such
\nrate of\t exchange is  different from  the rate in the decree
\nwhich  has  been  challenged,  the  court  should  make\t the
\nnecessary modification\twith respect to the rate of exchange
\nby its\tappellate decree  or final order. In all such cases,
\nexecution can  only issue for the rupee equivalent specified
\nin the\tdecree, appellate decree or final order, as the case
\nmay be.\t These questions,  of course,  would  not  arise  if
\npending appeal or other proceedings adopted by the defendant
\nthe  decree  has  been\texecuted  or  the  money  thereunder
\nreceived by the plaintiff.\n<\/p>\n
     Turning now  to arbitrations, on principle there can be
\nand should  be\tno  difference\tbetween\t an  award  made  by
\narbitrators or\tan umpire  and a  decree of  a court. In the
\ntype of\t cases we are concerned with here just as the courts
\nhave power  to make a decree for a sum of money expressed in
\na foreign currency subject to the limitations and conditions
\nwe have\t set out  above, the  arbitrators or umpire have the
\npower to  make an  award for  a sum  of money expressed in a
\nforeign currency. The arbitrators or umpire should, however,
\nprovide in  the award  for the rate of exchange at which the
\nsum awarded in a foreign currency should be converted in the
\nevents mentioned  above. This may be done by the arbitrators
\nor umpire  taking either  the rate of exchange prevailing on
\nthe date  of the  award or  the date  nearest or most nearly
\npreceding the  date of\tthe award  or by  directing that the
\nrate of\t exchange at which conversion is to be made would be
\nthe date when the court pronounces judgment according to the
\naward and  passes the  decree in  terms thereof\t or the date
\nnearest or most nearly preceding the date of the judgment as
\nthe court  may determine.  If the arbitrators or umpire omit
\nto provide  for the  rate of  conversion, this\twould not by
\nitself be  sufficient to invalidate the award. The court may
\neither remit  the award\t under section 16 of the arbitration
\nAct, 1940,  for the purpose of fixing the date of conversion
\nor may\tdo so  itself taking  the date\tof conversion as the
\ndate of\t its judgment  or the  date nearest  or most  nearly
\npreceding it,
\n590<\/span>
\nfollowing the  procedure outlined  above for  the purpose of
\nproof of  the rate  of exchange\t prevailing on such date. If
\nhowever, the  person liable  under such\t an award desires to
\nmake payment  of the  sum in foreign currency awarded by the
\narbitrators or umpire without the award being made a rule of
\nthe court,  he would  be at liberty to do so after obtaining
\nthe requisite  permission of the concerned authorities under
\nthe Foreign Exchange Regulation Act, 1973.\n<\/p>\n
     In the  case of  the said\taward which had led to these
\nappeals before\tus, the party entitled to receive the money-
\nForasol-was a  foreign party.  Under the  said contract, the
\ncurrency of  account was  a foreign  currency and so was the
\ncurrency of  payment except  for a  portion thereof. Forasol
\nwas, therefore, entitled, on payment not being made to it by
\nONGC, to  receive in  French Francs the amounts which became
\npayable to  it in  that currency. The Umpire was, therefore,
\njustified in  providing that  the amounts  payable under the
\nsaid award  to Forasol\tin French  Francs should  be paid in
\nFrench currency.  The Umpire  has, however, neither provided
\nthat such  payment would be subject to the permission of the
\nforeign exchange  authorities being  obtained nor  specified
\nthe conversion rate to be applied in the eventualities which
\nwe have\t set out  above. That,\thowever, does  not make\t any
\ndifference because  neither party  has objected\t to the said
\naward on  this ground.\tOn the\tcontrary, both\tparties have
\naccepted the  said  award  as  binding\tand  conclusive.  As
\nmentioned above,  this omission\t on the\t part of  the Umpire
\ncould have  been corrected  by the  Delhi High Court when it
\ncame to\t pronounce judgment  according to the said award and
\npass the  said decree in terms thereof. The decree passed in
\nterms of  the said  award, however,  does not specify either
\nthe rupee  equivalent of the amount in French Francs payable
\nto Forasol  or the  rate of exchange at which the conversion
\nof such\t amount into  Indian rupees  should be made. To that
\nextent, the  decree passed in terms of the said award by the
\nDelhi High  Court was  not a proper decree. Both the parties
\nhave,  however,\t accepted  the\tsaid  decree  and  have\t not
\nchallenged it  on this\tground in  any proceedings.  In\t any
\nevent, the  aforesaid mistake  in the  said decree  was\t one
\nwhich could  have been\tgot corrected  by an application for
\nreview or  by an  application under  section 152  or, in any
\nevent under  section 151,  of the  Code of  Civil Procedure,
\n1908. The  decree has  now become final and binding upon the
\nparties. Both  the parties have accepted the said decree and
\nthe said  decree cannot, therefore, be said to be invalid on
\nthe ground of the above omission to specify either the rupee
\nequivalent of the French Franc
\n591<\/span>
\nportion of  the said  award or the rate of exchange at which
\nsuch French Franc portion was to be converted into its rupee
\nequivalent.\n<\/p>\n
     For the reasons set out above, we hold that the learned
\nSingle Judge rightly took the date of the decree as the date
\nof  conversion.\t  In  his   order  on\tthe  said  execution
\napplication he\thas, however,  given a\tdirection that\tONGC
\ncould satisfy  the judgment debt by making payment in French
\nFrancs or if they so preferred, by paying the equivalent sum
\nin rupees  at the rate of exchange prevailing on the date of
\nthe decree. He was in error in not qualifying this direction
\nby making the option given to ONGC to make payment in French
\nFrancs\tsubject\t  to  the   permission\tof   the   concerned
\nauthorities under the Foreign Exchange Regulation Act, 1973.
\nTo this extent, the order passed by the learned Single Judge
\nrequires to be modified.\n<\/p>\n
     Turning now  to the appeal filed by ONGC, it was stated
\nin the\tSpecial Leave Petition filed by ONGC that it had two
\nclaims against\tForasol, the  first with respect to what was
\ntermed as  “tax differential” and the second with respect to
\ninterest on  the amounts  payable by  Forasol to  ONGC. Both
\nthese claims  were negatived by the learned Single Judge. It
\nwas expressly  stated in  paragraph 19\tof the Special Leave
\nPetition of  ONGC that\texcept for the aforesaid two claims,
\nthe judgment  and order\t of the\t Division Bench of the Delhi
\nHigh Court should be affirmed.\n<\/p>\n
     ONGC’s claim  for tax differential was based on Article
\nIV-1.2 of  the said  contract under which Forasol was to pay
\nincome-tax, surcharge  on income  tax and  all other  taxes,
\nwhich  might  be  assessed  and\t levied\t by  the  income-tax
\nauthorities in India on the income of Forasol under the said
\ncontract as  well as  on the  income of\t Forasol’s personnel
\nfrom the  work performed  by them  under the  said contract.
\nUnder the  proviso to the said Article, if subsequent to the
\ndate of\t the said  contract, the  tax rates  in\t India\twere
\nchanged so  as to  be higher than what they were at the date
\nof the\tsigning of  the said  contract, ONGC  was to pay the
\ndifference to  Forasol and  if the  tax rates  became lower,
\nForasol was  to pay the difference to ONGC. This proviso was
\nnot to\tbe applicable  in respect  of the  taxes payable  by
\nForasol on  the income\tof its personnel. The learned Single
\nJudge has  pointed out\tin his\tjudgment that  the claim  in
\nrespect of tax differential did not survive in as much as by
\nthe said  award the amounts paid by ONGC as tax on behalf of
\nForasol were  adjusted and  given credit  for. ONGC  did not
\nchallenge this finding in the appeal filed by it
\n592<\/span>
\nin the\tDelhi High  Court. None\t the  less  ONGC  sought  to
\nreagitate this\tpoint in  its Special Leave Petition. At the
\nhearing of this appeal, learned Counsel for ONGC stated that
\nhe was\tnot pressing  this point.  In the written submission
\nfiled on  behalf of  ONGC after\t the hearing  of both  these
\nappeals was  concluded, ONGC has, however, once again sought
\nto raise  this point. The point not having been urged in the
\nintra-court appeal  in the  Delhi High Court and also having
\nbeen given  up at  the hearing\tof these appeals before this
\nCourt, ONGC cannot be permitted subsequently to agitate this
\npoint in the written submissions filed on its behalf. In any
\nevent, in our opinion, the learned Single Judge was right in
\nrejecting this claim of ONGC.\n<\/p>\n
     So far  as ONGC’s\tclaim for  interest is concerned, it
\nhas been  negatived both by the learned Single Judge and the
\nDivision Bench of the Delhi High Court. We find no substance
\nin this\t claim. The  relevant provision\t of the\t said  award
\nwhich deals with payment of interest is as follows:\n<\/p>\n
\t  “Under the  contract there is no right to interest
\n     to either\tparty except on French Francs. If the amount
\n     paid by  ONGC to  the credit  of Forasol  in regard  to
\n     Income Tax\t and the  several  items  of  allowance\t and
\n     disallowance under\t this award are worked out and it is
\n     found that there is an amount payable to ONGC in French
\n     Francs that  would carry interest, but if the amount is
\n     in rupees\tthen no\t interest could be allowed until the
\n     date of the award.”\n<\/p><\/blockquote>\n
The amounts  on which  interest\t is  claimed  by  ONGC\twere
\npayable by  Forasol in\trupees and  not\t in  French  Francs.
\nTherefore, by  the express terms of the said award, there is
\nno right  in ONGC to claim any interest on these amounts and
\nthis claim for interest was rightly negatived.\n<\/p>\n
     In the  result, we\t allow Civil  Appeal No. 628 of 1981
\nfiled by  Forasol and  set aside  the order  passed  by\t the
\nDivision Bench\tof the\tDelhi High Court in the appeal filed
\nby the oil and Natural Gas Commission, namely, E.F.A. (O.S.)
\n5 of  1977 and\twe restore  and confirm the order passed and
\ndirections given  by the  learned Single  Judge of the Delhi
\nHigh Court  in the  Execution Application  filed by Forasol,
\nnamely, Execution  No. 77  of 1976,  with this\tmodification
\nthat if\t the Oil  and Natural Gas Commission wants to pay in
\nFrench
\n593<\/span>
\nFrancs the  amount due\tby it under the said decree, it will
\nbe at  liberty\tto  do\tso  after  obtaining  the  requisite
\npermission of  the concerned  authorities under\t the Foreign
\nExchange Regulation Act, 1973.\n<\/p>\n
     We dismiss\t Civil Appeal  No. 629\tof 1981 filed by the
\nOil and Natural Gas Commission.\n<\/p>\n
     The Oil  and Natural Gas Commission will pay to Forasol
\nthe costs  of both  the Appeals in this Court as also of the
\nAppeal E.F.A. (O.S.) 5 of 1977 in the Delhi High Court.
\nH.S.K.\t CA No. 628\/81 allowed and CA No. 629\/81 dismissed.\n<\/p>\n
594<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Forasol vs Oil & Natural Gas Commission (And … on 25 October, 1983 Equivalent citations: 1984 AIR 241, 1984 SCR (1) 526 Author: D Madon Bench: Madon, D.P. PETITIONER: FORASOL Vs. RESPONDENT: OIL & NATURAL GAS COMMISSION (AND VICE VERSA) DATE OF JUDGMENT25\/10\/1983 BENCH: MADON, D.P. BENCH: MADON, D.P. MUKHARJI, SABYASACHI […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-21514","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nForasol vs Oil & Natural Gas Commission (And ... on 25 October, 1983 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Forasol vs Oil & Natural Gas Commission (And ... on 25 October, 1983 - Free Judgements of Supreme Court & High Court | Legal India\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983\" \/>\n<meta property=\"og:site_name\" content=\"Free Judgements of Supreme Court & High Court | Legal India\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/LegalindiaCom\/\" \/>\n<meta property=\"article:published_time\" content=\"1983-10-24T18:30:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2016-04-13T16:19:31+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/i0.wp.com\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg?fit=512%2C512&ssl=1\" \/>\n\t<meta property=\"og:image:width\" content=\"512\" \/>\n\t<meta property=\"og:image:height\" content=\"512\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Legal India Admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@legaliadmin\" \/>\n<meta name=\"twitter:site\" content=\"@Legal_india\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Legal India Admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"148 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983\"},\"author\":{\"name\":\"Legal India Admin\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/person\\\/0bfdffe9059fb8bb24a86d094609c5ea\"},\"headline\":\"Forasol vs Oil & Natural Gas Commission (And … on 25 October, 1983\",\"datePublished\":\"1983-10-24T18:30:00+00:00\",\"dateModified\":\"2016-04-13T16:19:31+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983\"},\"wordCount\":24897,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#organization\"},\"articleSection\":[\"Supreme Court of India\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983\",\"name\":\"Forasol vs Oil & Natural Gas Commission (And ... on 25 October, 1983 - Free Judgements of Supreme Court & High Court | Legal India\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#website\"},\"datePublished\":\"1983-10-24T18:30:00+00:00\",\"dateModified\":\"2016-04-13T16:19:31+00:00\",\"breadcrumb\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Forasol vs Oil & Natural Gas Commission (And … on 25 October, 1983\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#website\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/\",\"name\":\"Free Judgements of Supreme Court & High Court | Legal India\",\"description\":\"Search and read the latest judgements, orders, and rulings from the Supreme Court of India and all High Courts. A comprehensive database for lawyers, advocates, and law students.\",\"publisher\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#organization\"},\"alternateName\":\"Free judgements of Supreme Court & High Court of India | Legal India\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#organization\",\"name\":\"Judgements of Supreme Court & High Court | Legal India\",\"alternateName\":\"Legal India\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/logo\\\/image\\\/\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/wp-content\\\/uploads\\\/sites\\\/5\\\/2025\\\/09\\\/legal-india-icon.jpg\",\"contentUrl\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/wp-content\\\/uploads\\\/sites\\\/5\\\/2025\\\/09\\\/legal-india-icon.jpg\",\"width\":512,\"height\":512,\"caption\":\"Judgements of Supreme Court & High Court | Legal India\"},\"image\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/logo\\\/image\\\/\"},\"sameAs\":[\"https:\\\/\\\/www.facebook.com\\\/LegalindiaCom\\\/\",\"https:\\\/\\\/x.com\\\/Legal_india\"]},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/person\\\/0bfdffe9059fb8bb24a86d094609c5ea\",\"name\":\"Legal India Admin\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g\",\"caption\":\"Legal India Admin\"},\"sameAs\":[\"https:\\\/\\\/www.legalindia.com\",\"https:\\\/\\\/x.com\\\/legaliadmin\"],\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/author\\\/legal-india-admin\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Forasol vs Oil & Natural Gas Commission (And ... on 25 October, 1983 - Free Judgements of Supreme Court & High Court | Legal India","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983","og_locale":"en_US","og_type":"article","og_title":"Forasol vs Oil & Natural Gas Commission (And ... on 25 October, 1983 - Free Judgements of Supreme Court & High Court | Legal India","og_url":"https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983","og_site_name":"Free Judgements of Supreme Court & High Court | Legal India","article_publisher":"https:\/\/www.facebook.com\/LegalindiaCom\/","article_published_time":"1983-10-24T18:30:00+00:00","article_modified_time":"2016-04-13T16:19:31+00:00","og_image":[{"width":512,"height":512,"url":"https:\/\/i0.wp.com\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg?fit=512%2C512&ssl=1","type":"image\/jpeg"}],"author":"Legal India Admin","twitter_card":"summary_large_image","twitter_creator":"@legaliadmin","twitter_site":"@Legal_india","twitter_misc":{"Written by":"Legal India Admin","Est. reading time":"148 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983#article","isPartOf":{"@id":"https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983"},"author":{"name":"Legal India Admin","@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/person\/0bfdffe9059fb8bb24a86d094609c5ea"},"headline":"Forasol vs Oil & Natural Gas Commission (And … on 25 October, 1983","datePublished":"1983-10-24T18:30:00+00:00","dateModified":"2016-04-13T16:19:31+00:00","mainEntityOfPage":{"@id":"https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983"},"wordCount":24897,"commentCount":0,"publisher":{"@id":"https:\/\/www.legalindia.com\/judgments\/#organization"},"articleSection":["Supreme Court of India"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983#respond"]}]},{"@type":"WebPage","@id":"https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983","url":"https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983","name":"Forasol vs Oil & Natural Gas Commission (And ... on 25 October, 1983 - Free Judgements of Supreme Court & High Court | Legal India","isPartOf":{"@id":"https:\/\/www.legalindia.com\/judgments\/#website"},"datePublished":"1983-10-24T18:30:00+00:00","dateModified":"2016-04-13T16:19:31+00:00","breadcrumb":{"@id":"https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/www.legalindia.com\/judgments\/forasol-vs-oil-natural-gas-commission-and-on-25-october-1983#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.legalindia.com\/judgments\/"},{"@type":"ListItem","position":2,"name":"Forasol vs Oil & Natural Gas Commission (And … on 25 October, 1983"}]},{"@type":"WebSite","@id":"https:\/\/www.legalindia.com\/judgments\/#website","url":"https:\/\/www.legalindia.com\/judgments\/","name":"Free Judgements of Supreme Court & High Court | Legal India","description":"Search and read the latest judgements, orders, and rulings from the Supreme Court of India and all High Courts. A comprehensive database for lawyers, advocates, and law students.","publisher":{"@id":"https:\/\/www.legalindia.com\/judgments\/#organization"},"alternateName":"Free judgements of Supreme Court & High Court of India | Legal India","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.legalindia.com\/judgments\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/www.legalindia.com\/judgments\/#organization","name":"Judgements of Supreme Court & High Court | Legal India","alternateName":"Legal India","url":"https:\/\/www.legalindia.com\/judgments\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/logo\/image\/","url":"https:\/\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg","contentUrl":"https:\/\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg","width":512,"height":512,"caption":"Judgements of Supreme Court & High Court | Legal India"},"image":{"@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.facebook.com\/LegalindiaCom\/","https:\/\/x.com\/Legal_india"]},{"@type":"Person","@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/person\/0bfdffe9059fb8bb24a86d094609c5ea","name":"Legal India Admin","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g","caption":"Legal India Admin"},"sameAs":["https:\/\/www.legalindia.com","https:\/\/x.com\/legaliadmin"],"url":"https:\/\/www.legalindia.com\/judgments\/author\/legal-india-admin"}]}},"modified_by":null,"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_likes_enabled":true,"jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/posts\/21514","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/comments?post=21514"}],"version-history":[{"count":0,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/posts\/21514\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/media?parent=21514"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/categories?post=21514"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/tags?post=21514"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}