Category: Law Services

Tags: breach of contract enforcement challenges India for foreign companies

Indian Company be statutorily viable? Yes, one can enforce foreign judgments, but with certain limitations. Section 44A of Code of Civil Procedure, 1908 permits the enforcement of UK judgements if they meet specific criteria: The UK and India must be form a reciprocating Territory, the judgement is for a definite sum not related to taxes, penalties etc. and also subject to scrutiny by Indian Courts that whether such judgement violates Indian public policy or obtained by fraudulent means. Lastly, after such scrutiny, it will take around 12-18 months to be enforced. What amounts to a Material breach under Indian law. Explain it with decided cases. Under Indian law, Material breach means any act violating material terms and Non-performance of basic obligations and duties amounts to material breach. Material breach means the breach which goes to the root of the contract and fundamentally undermines its core purpose and formulation. In this regard, placing reliance upon Murlidhar Chiranjilal Vs Intl. Film Co., 1943, the honourable court established that a material breach is the breach which substantially affects the rights of the innocent parties and deprives such party of availing benefits under the agreement. Recently, I have been working with my UK manufacturing client, where the Indian suppliers delayed the delivery of a critical component by three months. It was deemed a material breach. How is the application of the principle of Unconscionability different in the UK, the US and India? In the UK, the principle of Unconscionability focuses on inequality in bargaining power as one party took an undue advantage of their position against the aggrieved party. Noteworthy, courts in the USA apply similar principles but more often with robust consumer protection, as both the UK and US apply these principles on the basis of power imbalance. However, Indian courts have shown reluctance to intervene in matters solely based on Unconscionability. It is crucial to furnish evidence of actual fraud, coercion, or under influence rather than a mere glimpse of inequality bargaining.