This judgment does not decide whether the principal amount was in fact paid in 2009 or whether any adjustment or set-off is available for amounts deposited and withdrawn; those questions are left to the executing court. It lays down no conversion date for the awarded sum and changes no law: the request to the Law Commission of India is a request for a study and possible recommendations, not a direction that alters the enforcement framework. The underlying execution proceedings continue before the Delhi High Court.
- Case
- M/s Royal Construction Company Pvt. Ltd. v. M/s National Projects Construction Corporation
- Court
- Supreme Court of India
- Decision
- Citation
- 2026 INSC 1167
- Bench
- Vikram Nath, J.; Sandeep Mehta, J.; Aparesh Kumar Singh, J.
- Judgment by
- Vikram Nath, J.
- Case numbers
- SLP(C) No. 14005/2026; M.A. @ Diary No. 48152/2026 in C.A. No. 1991/2019
- Outcome
- Civil Appeal arising out of SLP(C) No. 14005 of 2026 disposed of in terms of the signed reportable judgment; Miscellaneous Application @ Diary No. 48152 of 2026 in Civil Appeal No. 1991 of 2019 dismissed, with liberty to raise adjustment or set-off objections before the executing court. The execution proceedings before the Delhi High Court continue.
What the Court decided
The Supreme Court has disposed of the appeal by M/s Royal Construction Company Pvt. Ltd. against an interim order of the Delhi High Court, refusing to clarify its earlier judgment of 10 October 2023 on the enforcement of a 2002 arbitral award. The Court held that its earlier appellate jurisdiction was confined to answering the substantial question of law certified by the High Court, and that it could not, in the guise of a clarification, take on a supervisory role over the continuing execution proceedings.
In the same judgment, the Court dismissed a miscellaneous application that sought modification of the 10 October 2023 judgment on the ground that amounts deposited in Indian rupees had already been withdrawn in 2009. The applicant remains free to raise all objections about adjustment or set-off of those amounts before the executing court.
Before parting, the Court requested the Law Commission of India to undertake a focused study of the framework governing the enforcement and execution of arbitral awards, and directed that a copy of the judgment be forwarded to the Chairman of the Law Commission.
The award and the long execution
The appellant is the award-holder and the respondent the award-debtor. Pursuant to an internationally seated arbitration, an award dated 10 August 2002 was rendered in favour of the appellant, with the amounts denominated in Iraqi Dinars. By a judgment dated 24 February 2015, the Supreme Court underscored the principle of minimal judicial intervention in arbitral awards, holding that courts ought not to substitute their own subjective satisfaction for that of the tribunal unless the statutory grounds under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996, are made out, and restored the directions in the 2002 award.
The appellant then began execution proceedings before the Delhi High Court. By an order dated 26 July 2017, the High Court directed that the award-debtor could discharge its liability in Indian currency, converted at the exchange rate prevailing on the date of the underlying agreement, that is, 26 September 1982. On appeal, the Division Bench set that order aside on 17 December 2019 and certified a substantial question of law of general importance under Articles 134-A and 133(1)(a) of the Constitution.
The question, as reproduced in the present judgment, was: “In terms of the agreement dated 29th June, 1982, between the parties and in light of the judgment dated 24th February, 2015 of the Supreme Court of India in Civil Appeal Nos. 2543-44/2015, what should be the relevant date for conversion of awarded sum from USD to Indian rupees?” By its judgment dated 10 October 2023, the Court answered that question in the negative, holding that no occasion arose for determining or fixing a date for conversion of US Dollars into Indian Rupees, and cautioning that the terms of the agreement, the arbitral award, and its 24 February 2015 judgment ought not to be disturbed.
While execution was still pending, the respondent contended that the principal amount had already been paid in 2009 pursuant to the High Court's orders. By an interim order dated 16 February 2026 in Execution First Appeal (Original Side) No. 17 of 2018, the High Court granted liberty to seek clarification from the Supreme Court as to why that 2009 payment in Indian Rupees had not been brought to its notice on the earlier occasion.
The question before the Court
The appeal assailed the High Court's interim order of 16 February 2026, which had granted liberty to seek clarification about the claimed 2009 payment. The miscellaneous application, filed in Civil Appeal No. 1991 of 2019, sought modification of the 10 October 2023 judgment on the ground that the amounts deposited by the award-debtor in Indian rupees pursuant to the High Court's order had already been withdrawn by the award-holder in 2009.
The issue, therefore, was whether the Supreme Court could now answer factual questions about amounts deposited and withdrawn, and clarify its 2023 judgment, in proceedings whose scope had been fixed by the certified question of law.
Why clarification was refused
The Court held that the Division Bench had fallen into error in appreciating the scope of the controversy previously adjudicated. The 10 October 2023 judgment showed that the Court, exercising appellate jurisdiction, was called upon to answer the substantial question of law certified by the High Court, and its consideration was therefore confined to that question, without examining factual matters beyond its ambit.
Having held that no occasion arose for fixing a conversion date and that payment was to be made in foreign currency, the Court had no occasion to clarify factual questions about amounts deposited or withdrawn. Nor can it be called upon, in the guise of clarification, to assume a supervisory role over the continuing execution proceedings; it is for the court seized of execution, and the appellate court over its orders, to determine those questions in accordance with law.
Once the referred question stood answered, the scope of the earlier proceedings stood exhausted, the Court held; it would be impermissible to enlarge that adjudication with questions distinct from the lis previously decided. For the same reason the miscellaneous application was dismissed: the earlier lis was confined to the certified question, so the Court was not called upon to adjudicate the deposit and withdrawal facts.
Operative outcome and the Law Commission request
The appeal stands disposed of in the terms of the signed reportable judgment, and the miscellaneous application stands dismissed, with liberty to raise all objections about adjustment or set-off of the deposited and withdrawn amounts before the executing court. All pending applications stand disposed of.
In an epilogue, the Court expressed concern at the protracted course of the proceedings: the arbitration was invoked when the Arbitration Act, 1940, held the field, and more than twenty-four years after the award was rendered, the parties continue to litigate over its enforcement. The efficacy of an arbitral regime, the Court observed, must equally be assessed by the ability of the successful party to realise the fruits of the award within a reasonable time.
The Court noted that Section 36 of the 1996 Act provides for enforcement of an award in the same manner as a decree, drawing upon the ordinary execution machinery of the Code of Civil Procedure, 1908. It identified the disclosure of the award-debtor's assets, the coordination of different modes of execution, the disposal of repetitive or dilatory objections, and the time taken to conclude execution proceedings as matters meriting focused scrutiny.
The Court therefore requested the Law Commission of India to undertake a focused study of the framework governing the enforcement and execution of arbitral awards: to identify the practical impediments to timely recovery, examine the experience of other jurisdictions, and consider whether domestic and foreign awards warrant distinct enforcement procedures or a common framework with appropriate safeguards. The Commission may make such legislative or procedural recommendations as it considers necessary to strengthen the execution regime, commensurate with the objectives of the 1996 Act and India's commitment to establishing itself as an arbitration-friendly jurisdiction. The Registry is to forward a copy of the judgment to the Chairman of the Law Commission.
BANTHRY ANALYSISFor law students
This judgment illustrates the limits of appellate jurisdiction when a court answers a certified question of law. The 2023 answer fixed the lis; a later clarification request could not reopen payment and withdrawal disputes that were never part of the referred question. Clarification is not a second appeal, and it is not supervision of execution.
Note also the award-stage versus execution-stage distinction: Sections 34 and 37 police challenges to awards on narrow statutory grounds, while Section 36 sends enforcement into the ordinary execution machinery of the Civil Procedure Code. Execution is where arbitration's promise of expedition most often fails, which is why the Court has asked the Law Commission to study the problem rather than laying down new execution rules itself.
For revision: why did the Court refuse to decide whether the 2009 payment discharged the liability? Because the certified question did not include it, and answering it would have enlarged a concluded adjudication (paras 7 to 10).
READING PROMPTSQuestions for a closer reading
- Why did the Supreme Court refuse to clarify its 10 October 2023 judgment about the claimed 2009 payment?
- What is the difference, on the Court's reasoning, between answering a certified question of law and supervising execution proceedings?
- What exactly has the Court asked the Law Commission of India to study, and what has it not decided by making that request?
