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<p class="banner-heading-text-two-line"><span>International Commercial Arbitration S.2(1)(f)</span><br><span class="banner-sub-heading">Definitions</span></p>
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<p><span class="padded-dropcap">U</span>nder Section 2(1)(f) of the Arbitration and Conciliation Act, 1996, International commercial arbitration refers to arbitration proceedings arising from legal relationships that, under the Indian jurisprudence and are characterised as commercial in nature., where at least one party is either a national or habitual resident of a country other than India, a body corporate incorporated outside India, an association or body of individuals with central management and control outside India, or the government of a foreign country. This cross-border nature distinguishes it from domestic arbitration. In TDM Infrastructure (P) Ltd. v. UE Development India (P) Ltd., the Court emphasized that the definition of international commercial arbitration is restrictive, clearly excluding domestic arbitration and focusing on the incorporation and central management of a company outside India. In Mankastu Impex (P) Ltd. v. Airvisual Ltd., the Court highlighted that an arbitration qualifies as international when at least one party is foreign, either in nationality or habitual residence and the dispute arises from a commercial relationship under Indian law.</p>
<p><strong>TDM Infrastructure (P) Ltd. v. UE Development India (P) Ltd., (2008) 14 SCC 271 at page 277</strong></p>
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<li>Whenever in an interpretation clause, the word “means” is used the same must be given a restrictive meaning. “International commercial arbitration” and “domestic arbitration” connote two different things. The 1996 Act excludes domestic arbitration from the purview of international commercial arbitration. The company which is incorporated in a country other than India is excluded from the said definition. The same cannot be included again on the premise that its central management and control is exercised in any country other than India. Although sub-clause (iii) of Section 2(1)(f) of the 1996 Act talks of a company which would ordinarily include a company registered and incorporated under the Companies Act but the same also includes an association or a body of individuals which may also be a foreign company.</li>
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<p><strong>Mankastu Impex (P) Ltd. v. Airvisual Ltd., (2020) 5 SCC 399 at page 405</strong></p>
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<li>The petitioner is a company incorporated in India, whereas the respondent is a company incorporated under the laws of Hong Kong. Section 2(1)(f) of the Act defines “international commercial arbitration”. As per Section 2(1)(f), to be an “international commercial arbitration”, three factors ought to be fulfilled:</li>
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<p style="padding-left: 60px;">(i) arbitration;</p>
<p style="padding-left: 60px;">(ii) considered as commercial under the laws in force in India; and</p>
<p style="padding-left: 60px;">(iii) at least one of the parties is national or habitual resident in any country other than India.</p>
<p>In the present case, since the respondent is a company incorporated under the laws of Hong Kong, we are concerned with “international commercial arbitration”.</p>
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