Foreign award conversion date clarified: unpaid balance uses enforceability date, but withdrawable court deposits use deposit date.

A foreign arbitral award expressed in foreign currency is converted into Indian rupees at the exchange rate prevailing when objections under Section 48 are finally rejected and the award becomes enforceable under Section 49. The Supreme Court held that the Forasol principle applies under the Arbitration and Conciliation Act, 1996, so the unpaid balance is valued on the finality date, not by reference to an earlier point. Amounts deposited in court during pendency, however, are treated differently if the award holder was permitted to withdraw them: that sum is converted on the date of deposit because the holder obtained practical access to it. A later exchange rate cannot be applied again to that withdrawable amount.

---

---

Issues: (i) What is the relevant date for converting a foreign arbitral award expressed in foreign currency into Indian rupees under the Arbitration and Conciliation Act, 1996. (ii) Whether amounts deposited in court during pendency of objections, and permitted to be withdrawn by the award holder, must be converted on the date of such deposit or on the date when the award finally becomes enforceable.

Issue (i): What is the relevant date for converting a foreign arbitral award expressed in foreign currency into Indian rupees under the Arbitration and Conciliation Act, 1996.

Analysis: The statutory scheme under Part II, Chapter I makes a foreign award binding and enforceable once objections under Section 48 are finally decided and rejected, whereupon Section 49 treats the award as a decree of the court. The principle in Forasol applies under the 1996 Act as well, because the conversion date must align with the date on which the award becomes enforceable. The Court held that the earlier foreign currency award jurisprudence is not confined to the Arbitration Act, 1940, and the proper date for conversion of the remaining unpaid award amount is the date on which objections attain finality and the award becomes enforceable.

Conclusion: The relevant date for conversion of the unpaid balance of the award is the date on which objections against the foreign award are finally dismissed and the award becomes enforceable.

Issue (ii): Whether amounts deposited in court during pendency of objections, and permitted to be withdrawn by the award holder, must be converted on the date of such deposit or on the date when the award finally becomes enforceable.

Analysis: Where the award debtor deposits money during pendency and the award holder is allowed to withdraw it against security, the award holder obtains the practical benefit of the money from that date. Following the approach applied in Renusagar and the logic underlying post-deposit interest principles, the deposited sum must be treated as converted on the date of deposit to the extent the award holder could access and use it. A later exchange rate cannot be applied again to that same amount merely because the final disposal of objections occurred thereafter. On the facts, the first deposit was made with the consent of parties and was withdrawable, while the second deposit was not immediately withdrawable and therefore stood on a different footing.

Conclusion: The first deposited amount stands converted on the date of deposit, while the later deposit and the remaining unpaid balance are to be converted on the date when the objections attained finality.

Final Conclusion: The Court corrected the conversion methodology by applying the deposit-date exchange rate to the amount withdrawn or withdrawable during pendency, and the finality-date exchange rate to the later deposit and the balance of the award, thereby modifying the High Court's approach in part.

Ratio Decidendi: Under the Arbitration and Conciliation Act, 1996, a foreign award expressed in foreign currency becomes convertible at the exchange rate prevailing on the date it becomes enforceable, and any amount deposited in court during pendency that the award holder is permitted to withdraw must be converted on the date of such deposit.

---