Justice N Kotiswar Singh said not every violation of Indian law amounts to breach of public policy in arbitration. He stressed courts must play a minimal role in arbitral matters.
New Delhi: At the Delhi Arbitration Weekend 2025, organised by the Vienna International Arbitral Centre (VIAC), Supreme Court judge Justice N Kotiswar Singh made an important observation on the interpretation of “public policy” in international arbitration.
He said that not every violation of Indian law can be treated as a breach of public policy, stressing the need for Indian courts to show restraint when dealing with arbitral matters.
Speaking at a breakfast session on the role of institutional arbitration in strengthening trade and economic relations between India and Central and Eastern European (CEE) countries, Justice Singh explained the challenges around the concept of public policy.
He said,
“The concept of public policy has been a minefield for lawyers; it’s a vague concept. Every violation of Indian law does not amount to violation of public policy. What is fundamental to Indian law is fundamental to Indian jurisdictions. Violation of public policy is the violation of fundamental law of the land.”
He further reflected on how the Indian judiciary’s role has been evolving in the arbitration space.
He said,
“A fundamental aspect of the Indian judiciary is that the Constitution is a transformative document. We are used to a proactive role as guardian of law. The role of courts in arbitral matters is expected to be least.”
Justice Singh admitted that it took time for Indian courts to adapt to a limited interference model in arbitration but said improvements had been made.
“We did take time to understand a hands-off approach to arbitration, but we got there. Our Indian legal system is a vast machinery, it doesn’t work in a fast manner. This is an area of concern.”
Highlighting the growth in trade between India and Europe, Hans-Jörg Hörtnagl, Commercial Counsellor at Advantage Austria, noted the expanding opportunities.
He said,
“Trade between India and EU increased by 90% in the last decade. Austria’s trade with India is over €2 billion, this year we will reach a bilateral trade of €3 billion.”
Niamh Leinwather, Secretary General of VIAC, explained why parties prefer arbitral seats with minimal court intervention.
She said,
“Vienna has an old civil code and an independent judiciary. Every court has its own specialised approach. The Supreme Court sees very few arbitration cases every year.”
Adding to the discussion, Justice (retd.) Rajiv Shakdher addressed the complexities of deciding the arbitral seat.
He said,
“As far as choice of seat is concerned, it has always been troubled. Fortunately there has been some consistency. Once you get it right, it’s more like a marker. Initial challenge to any award will depend on the seat. As far as seat and venue is concerned Supreme Court has set it in stone.”
He also pointed out that Indian courts have been supportive of enforcing awards even when foreign exchange issues were involved.
“Even where there is outflow of foreign exchange, RBI has taken a more proactive view and supported the enforcement of the award. Indian courts are pro-enforcement.”
The session, titled “Role of institutional arbitration amidst bolstering economic relations between India and the CEE region,” was moderated by Arush Khanna, Partner at Numen Law Offices and VIAC Ambassador for India.
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