Additional SG Vivek Tankha represents India in International Arbitration under Bilateral Investment treaty between India and Australia

The TOI has today reported that a claim has been filed against India under the Bilateral Investment Treaty between India and Australia by Australia’s White Industries. Additional Solicitor General Vivek Tankha is representing India in this arbitration. Tankha, a former Advocate General of Madhya Pradesh is currently in London for the arbitration proceedings between White Industries and Republic of India..The TOI has today reported that a claim has been filed against India under the Bilateral Investment Treaty between India and Australia by Australia’s White Industries. Additional Solicitor General Vivek Tankha (pictured) is representing India in this arbitration. Tankha, a former Advocate General of Madhya Pradesh is currently in London for the arbitration proceedings between White Industries and Republic of India..Speaking to Bar & Bench on the arbitration Senior Counsel Vivek Tankha said, “It’s a very rare international arbitration. This is actually not an arbitration but is like an international tribunal which is one step above the arbitration”..The dispute relates to an arbitration between Coal India and White Industries over entitlement for bonuses under a 1989 Agreement for supply of equipment and development of a coal mine in Piparwar. The Agreement provided that the arbitration would be conducted as per the ICC Rules and the applicability of the Arbitration Act, 1940 (Act) would be excluded..Tankha explaining the dispute said, “The arbitration between Coal India and White Industries ended in some sort of controversial award in favour of White Industries, which was challenged by Coal India under Section 34 of the Act before the Kolkata High Court while White Industries sought the enforcement of the award before Delhi High Court. White Industries raised an objection on the maintainability of the application under Section 34 which travelled up to Supreme Court of India in 2004. In 2008, the matter was heard for some time. Coal India argued that the two Judgments Bhatia International and Venture Global were in favour of Coal India and that Section 34 is maintainable in case of foreign awards which are governed by Indian law. White Industries submitted that this is a foreign award and objection cannot be filed in India. There was a difference of opinion amongst the judges and the matter was referred to a larger bench and is now pending before the Supreme Court of India”..In the interim, White Industries had invoked arbitration against the Republic of India under the Australia-India bilateral treaty on the promotion and protection of investments, signed in New Delhi in 1999 in accordance with the United Nation Commission on International Trade Law (UNCTRIAL)..India has signed 137 such treaties with other countries. As per the treaty, each contracting state has assured that its investors will be given fair treatment; there will be no denial of justice and no discrimination. In the event of bilateral treaty being violated, there will be a dispute resolution mechanism. The dispute resolution mechanism postulates the creation of a tribunal. In the event, the parties fail to agree to the composition of a tribunal, then the International Court of Justice will formulate a tribunal. Under this treaty, a tribunal has been constituted with three arbitrators from Singapore, UK and USA..Tankha told that the plea of White Industries is that they have an International commercial award and this award could not have been challenged in India and even to get this decided whether this can be challenged in India or not, it has taken 8-9 years and even the end of that is not in sight. In short White Industries states that Indian Judicial system has denied them justice and Indian State has not been able to secure justice to them. All this leads to a situation where Indian State has to take up the responsibility for non-implementation of the award and the entire claim has to be paid by Indian State..Tankha further said, “If the matter is going to be decided against us, the result will be since India has bilateral treaty with 137 countries, and any investor who feels he is being denied justice in this country, he need not pursue his commercial remedies and he may go and file a case under the bilateral treaty and say that there is denial of justice. We argued this before the tribunal. We further argued that under Public International Law, there is no way that you cannot respect the local laws and local courts. We also tried to prove that though there has been some delay but the delay is because of their wrong legal strategy, especially when White Industries knew that Section 34 is maintainable.”.The proceedings were started on September 19. The tribunal heard the parties for 2-3 days and the arguments are complete now. The order has now been reserved.