IN THE SUPREME COURT OF BANGLADESH HIGH COURT DIVISION

(STATUTORY APPELLATE JURISDICTION)

                Present:

Mr. Justice Md. Toufiq Inam

Arbitration Appeal No. 08 of 2025.

IN THE MATTER OF:

An  Appeal  under  section  48(c)  of  the Arbitration Act, 2001.

And

IN THE MATTER OF:

South Express Ltd.,

.......Award Holder/Appellant.

-Versus-

Madina Enterprise and another

........ Award Debtor-Respondents.

Mr. Mohiuddin Abdul Kadir, Advocate with Mr. Md. Al-Amin Sarker,

Mrs. Zinia Amin,

Mr. Noor Mohammad Mozumder Roni, and Mr. Md. Taukir Ahmed, Adovcates

.........For the Award Holder/Appellant.

Mr.  Imran  A.  Siddique,  Senior  Advocate with

Mr. M.A. Saiful Rahman, and

Mrs. Umma Salma, Advocates

.......... For the Award Debtor-Respondents.

Judgment Delivered On 09th July, 2026.

Md. Toufiq Inam, J

1. This  appeal  arises  from  Order  No. 25 dated  08.01.2024 passed  by  the  learned  District  Judge,  Dhaka,  in  Money Execution Case No. 15 of 2018, whereby the learned Judge declined to recognize and enforce the foreign arbitral award dated 29.11.2015, purported to annul the said award, and, as a consequence, dismissed the execution proceeding.

2. The facts, giving rise to the present appeal, in brief, are that the  parties  entered  into  a  Memorandum  of  Agreement (MOA) dated 10.05.2015 for the sale and purchase of the vessel M.V. Fengli-1. Clause 15 of the MOA contained an arbitration agreement providing that any dispute arising out of or in connection with the agreement would be referred to arbitration  in  London.  Subsequently,  disputes  arose between  the  parties.  According  to  the  Appellant,  it  was compelled,  under  duress  and  without  any  lawful consideration, to execute Addendum No. 1 to the MOA, whereby the agreed sale price of the vessel was reduced, and to deliver the vessel at the reduced price. Consequently, the  Appellant  invoked  the  arbitration  agreement  and commenced arbitral proceedings in London.
3. Despite having been duly notified, the Respondents failed to  appoint  their  arbitrator  within  the  stipulated  time. Consequently, in accordance with section 17 of the UK Arbitration Act 1996, Mr. Graham Clark validly assumed jurisdiction as the Sole Arbitrator. The Respondents were duly  notified  of  the  arbitral  proceedings  and  were represented  through  solicitors;  however,  they  failed  to participate effectively in the proceedings. Upon conclusion of  the  arbitration,  the  Sole  Arbitrator  rendered  and published the Final Award on 29.11.2015. It is an admitted position  that  the  Award  has  never  been  challenged,  set aside, or suspended before any competent court in England, the seat of the arbitration.

4. Thereafter, the Appellant instituted Money Execution Case No. 15 of 2018 under section 45 of the Arbitration Act, 2001  seeking  recognition  and  enforcement  of  the  said foreign arbitral award. By Order No. 25 dated 08.01.2024, the learned District Judge, Dhaka refused to recognize and enforce the foreign arbitral award, purported to set aside the Award,  and  consequently  dismissed  the  execution  case. Being aggrieved by and dissatisfied with the said order, the Appellant has preferred the present appeal.

Submissions of the Appellant

5. Mr.  Mohiuddin  Abdul  Kadir,  learned  Advocate  for  the appellant,  submits  that  the  learned  District  Judge  acted beyond the limited jurisdiction conferred by sections 45 and 46 of the Arbitration Act, 2001 in refusing recognition and enforcement of the foreign arbitral award, purporting to set aside  the  Award,  and  dismissing  the  execution  case. According to him, the impugned order is contrary to the Arbitration Act, 2001 and the settled principles governing the recognition and enforcement of foreign arbitral awards.
6. He submits that the finding that the Sole Arbitrator was not appointed  in  accordance  with  Clause  15  of  the Memorandum of Agreement and sections 15 to 18 of the UK Arbitration Act 1996 is wholly erroneous. He contends that  the  respondents  admittedly  received  notice  of arbitration but failed to appoint their arbitrator within the prescribed time. Consequently, under section 17 of the UK Arbitration Act 1996, Mr. Graham Clark validly assumed office as Sole Arbitrator. The respondents, despite engaging HFW Solicitors, chose not to participate in the proceedings and never challenged the Tribunal's jurisdiction before the English courts. Reliance is placed on  Minermet S.p.A. v. Lucky Field Shipping Co. Ltd [2004} EWHC 729 (Comm).

7. He  further  submits  that  the  learned  Judge's  finding regarding  the  improper  constitution  of  the  Tribunal  and absence  of  notice  is  contrary  to  the  respondents'  own pleadings, wherein they admitted receiving the Notice of Arbitration, engaging solicitors and failing to appoint an arbitrator. The learned Judge, according to him, assigned no legal or factual basis for reaching a contrary conclusion.
8. Assailing the finding on public policy, learned Advocate submits  that  the  learned  Judge  failed  to  identify  any principle  of  Bangladeshi  public  policy  which  would  be violated  by  enforcement  of  the  Award.  He  argues  that Bangladesh,  as  a  Contracting  State  to  the  New  York Convention, has adopted a legislative policy favouring the recognition and enforcement of foreign arbitral awards and that the public policy exception under section 46(1)(b)(ii) must therefore receive a narrow construction.
9. He  next  submits  that  the  appellant  fully  complied  with section  45  of  the  Arbitration  Act,  2001  by  filing  the authenticated copy of the Award, the arbitration agreement and  all  supporting  documents  prescribed  under  section 45(2). He contends that the Act contemplates a composite proceeding for recognition and enforcement and does not require separate applications.

10. He further submits that the learned District Judge exceeded the scope of section 46 by reappraising the merits of the Award,  reassessing  the  evidence  and  questioning  the findings of the Tribunal. According to him, an enforcing court is not competent to sit in appeal over a foreign arbitral award or substitute its own conclusions for those of the Tribunal.
11. Mr. Kadir also submits that the learned District Judge acted wholly without jurisdiction in purporting to set aside the foreign  arbitral award.  Under the  Arbitration  Act, 2001, Bangladeshi courts are empowered only to recognize and enforce, or refuse recognition and enforcement of, a foreign arbitral  award.  The  power  to  annul  such  an  award  lies exclusively with the courts of the seat of arbitration.
12. He  further  contends  that  the  respondents'  objection regarding the drafting defects in Clause 15 is misconceived. According to him, the parties' intention to submit disputes to  arbitration  in  London  is  unmistakable,  and  the  Sole Arbitrator rightly construed the clause by giving effect to that intention. He also submits that, under English law, the obligation  to  attempt  an  amicable  settlement  is  not  an enforceable condition precedent to arbitration. Reliance is placed on Russell on Arbitration P.130, paragraph 4-037, Paul  Smith  Ltd.  v.  H&S  International  (1991)  2  Lloyds Report  127,  Itex  Shipping  Pte.  Ltd.  v.  China  Ocean Shipping  Co.  (1989)  2  Lloyds  Rep  522  and  Demerara Distilleries (P) Ltd. v. Demerara Distillers Ltd.

13. In conclusion, learned Advocate submits that none of the grounds enumerated in section 46 of the Arbitration Act, 2001  has  been  established  and,  therefore,  the  impugned order is liable to be set aside and the foreign arbitral award recognized and enforced.

Submissions of Respondent No. 1

14. Per contra, Mr. Imran A. Siddiq, learned Senior Advocate appearing  for  Respondent  No.  1  supports  the  impugned order  and  submits  that  the  learned  District  Judge  rightly refused recognition and enforcement of the foreign arbitral award. According to him, the Award is unenforceable under section 46 of the Arbitration Act, 2001 and the appeal is liable to be dismissed.
15. He submits that the constitution of the Arbitral Tribunal was not in accordance with the arbitration agreement, thereby attracting section 46(1)(a)(v) of the Arbitration Act, 2001. Referring to Clause 15 of the Memorandum of Agreement, he contends that the parties had expressly agreed to attempt an  ‘amicable  settlement’  before  referring  any  dispute  to arbitration. Since the appellant invoked arbitration without complying with this mandatory pre-arbitral requirement, the arbitral proceedings were initiated in breach of the agreed procedure. In support, he relies upon Genesis System Ltd. v. Clapp & Mayne Inc., International Research Corp PLC v. Lufthansa Systems Asia Pacific Pte. Ltd., Nirman Sindia v. Indal  Electromelts  Ltd.  and  Orissa  Power  Transmission Corporation Ltd. v. Ranjit Singh and Co.

16. He next submits that enforcement of the Award would be contrary  to  the  public  policy  of  Bangladesh  within  the meaning  of  section 46(1)(b)(ii) of the Act.  According  to him, the agreed multi-tier dispute resolution mechanism was intended to promote efficient and economical resolution of commercial  disputes,  and  its  complete  disregard  by  the appellant defeats the contractual bargain between the parties. Reliance is placed on United Group Rail Services Ltd. v. Rail Corporation New South Wales and Emirates Trading Agency LLC v. Prime Mineral Exports Private Ltd.
17. He further submits that the arbitration clause is incapable of performance  as it refers to  a non-existent governing law ("Federal Maritime Law of the London") and a non-existent arbitral  institution  ("Society  of  Maritime  Arbitrators  in UK"). He contends that the Sole Arbitrator exceeded his authority by substituting English law and the Rules of the London Maritime Arbitrators Association (LMAA) in place of the contractual provisions, thereby effectively rewriting the parties' agreement. In support, he relies upon Klöckner Pentaplast Gmb H & Co KG v. Advance Technology (HK) Co. Ltd. and Grand Ocean & Williams Co. Ltd. v. Huaxicun Offshore Engineering Co. Ltd.
18. He further submits that the appellant failed to satisfy the mandatory  requirements  of  sections  45  and  46  of  the Arbitration Act, 2001 and that the learned District Judge rightly refused recognition and enforcement of the Award. According  to  him,  the  findings  recorded  by  the  learned Judge are supported by the materials on record and disclose no error of law or jurisdiction warranting interference by this Court.

19. In conclusion, learned Advocate submits that the impugned order was passed in accordance with the Arbitration Act, 2001 and the settled principles governing enforcement of foreign arbitral awards. He, therefore, prays that the appeal be dismissed with costs and the order of the learned District Judge be affirmed.
20. On the above facts, the principal issues before the appellate court are not whether the award is correct on the merits, but whether  the  learned  District  Judge  remained  within  the narrow jurisdiction conferred by sections 45 and 46 of the Arbitration Act, 2001, which substantially incorporate the enforcement regime of the New York Convention, 1958. A strong appellate reasoning should therefore emphasize the limited scope of judicial review at the enforcement stage and the  distinction  between  refusal  of  enforcement  and annulment of a foreign award.Section 3(2) of the Act 2001 delineates  the  Court's  extra-territorial  enforcement jurisdiction in relation to foreign arbitral awards. Through sections 45 and 46, the Court is empowered to recognize, enforce or refuse enforcement of foreign arbitral awards in accordance  with  the  New  York  Convention  framework embodied  in  the  Act.  These  provisions  do  not  confer supervisory  authority  over  the  conduct  of  foreign arbitrations; rather, it enables domestic courts to determine the enforceability of foreign awards within Bangladesh.

1. Scope of inquiry under Sections 45 and 46

21. At the outset, it must be borne in mind that proceedings under sections 45 and 46 of the Arbitration Act, 2001 are not appellate proceedings against a foreign arbitral award. A  Bangladeshi  court  exercising  jurisdiction  under  these provisions does not sit in appeal over the findings of the arbitral tribunal. Its jurisdiction is confined to determining whether  any  of  the  limited  and  exhaustive  grounds enumerated in section 46 have been established by the party resisting  enforcement.  Unless  one  or  more  of  those statutory  grounds  are  affirmatively  proved,  the  Court  is under  a  legal  obligation  to  recognize  and  enforce  the foreign arbitral award.
22. This legislative policy is a direct reflection of Bangladesh's obligations under the New York Convention, 1958, which proceeds on the fundamental principle that foreign arbitral awards  are  to  be  enforced  save  in  exceptional circumstances.  Consequently,  the  grounds  contained  in section  46  must  receive  a  narrow  and  restrictive interpretation  and  cannot  be  expanded  by  judicial innovation.

2. District Judge exceeded jurisdiction

23. Having examined the impugned order, this Court finds that the learned District Judge travelled far beyond the limited jurisdiction conferred by section 46. Instead of confining himself to the statutory grounds for refusal of enforcement, he embarked upon a detailed examination of the correctness of  the  arbitral  proceedings,  the  findings  of  fact,  the interpretation  of  the  contract,  and  even  the  legal conclusions reached by the Sole Arbitrator.

24. The observations that the Arbitrator committed "mistakes of law", "mistakes of fact", "exceeded his lawful authority", or failed to act "competently or professionally" unmistakably demonstrate that the learned Judge undertook an appellate review of the Award. Such an exercise is wholly foreign to section 46. Whether the Arbitrator correctly interpreted the contract,  correctly  appreciated  the  evidence,  or  correctly applied English law were matters falling exclusively within the  jurisdiction  of  the  supervisory  courts  of  the  seat  of arbitration. They are not grounds available to an enforcing court under the Arbitration Act, 2001.

3. No jurisdiction to set aside a foreign award

25. Even  more  fundamentally,  the  learned  District  Judge purported to "set aside" the foreign arbitral award. Such a course was plainly beyond his jurisdiction. The Arbitration Act, 2001 nowhere confers power upon Bangladeshi courts to annul or set aside a foreign arbitral award. Sections 45 and 46 merely empower the Court either—to recognize and enforce the award; or to refuse recognition and enforcement upon proof of one of the statutory grounds.

26. The power of annulment belongs exclusively to the courts exercising supervisory jurisdiction at the seat of arbitration. Since the present arbitration was seated in London, only the competent  courts  of  England  possessed  authority  to  set aside the Award. The impugned order, insofar as it purports to annul the Award itself, is therefore without jurisdiction and a nullity.

4. Composition of the Tribunal

27. The learned District Judge further held that the composition of the Tribunal was contrary to the agreement of the parties and that no proper notice had been given. This finding is contrary  to  the  admitted  materials  on  record.  The respondents  themselves  admitted  receiving  notice  of arbitration. They also admitted engaging English solicitors, namely HFW, to represent them. Equally undisputed is the fact that they failed to appoint their arbitrator within the prescribed period.
28. Once that occurred, section 17 of the UK Arbitration Act 1996  empowered  the  claimant's  nominated  arbitrator  to proceed  as  Sole  Arbitrator.  More  importantly,  the  Sole Arbitrator specifically ruled upon his own jurisdiction and recorded the circumstances leading to his appointment. The respondents  never  challenged  that  ruling  before  any competent English court. Having elected not to invoke the remedies available under the curial law, the respondents cannot invite an enforcing court in Bangladesh to reopen jurisdictional questions already determined by the tribunal.

5. Pre-arbitral amicable settlement

29. The respondents have strongly argued that arbitration was commenced without first attempting ‘amicable settlement’. This contention cannot be accepted for several independent reasons.

Firstly,  Clause  15  does  not  prescribe  any  definite procedure, time frame or objective mechanism governing such negotiations.

Secondly,  the  arbitration  was  expressly  agreed  to  be seated in  London. Consequently,  questions  concerning the procedural validity of commencement of arbitration fall to be determined by the curial law governing the arbitration, namely English law.

Thirdly,  the  Sole  Arbitrator  considered  the  issue  and nevertheless  assumed  jurisdiction.  That  jurisdictional determination  attained  finality  when  it  was  never challenged before the English courts.

Fourthly, even assuming there existed some procedural irregularity regarding commencement of arbitration, such issue  cannot  justify  an  extensive  merits review  by  an enforcing court beyond the parameters of section 46.

6. Alleged defect in the arbitration clause

30. The  respondents  have  also  argued  that  because  the agreement  referred  to  "Federal  Maritime  Law  of  the London" and the "Society of Maritime Arbitrators in UK", the arbitration clause was incapable of performance. This submission also lacks substance. Commercial contracts are interpreted so as to give business efficacy to the parties' evident intention rather than defeat it by reason of drafting imperfections.  The  parties  unequivocally  agreed  that disputes would be resolved by arbitration in London before three arbitrators.

31. The references to non-existent expressions were carefully analysed by the Sole Arbitrator, who concluded that they were  obvious  drafting  errors  and  that  the  parties unmistakably  intended  an  English  seated  maritime arbitration. This interpretation gives effect to the parties' commercial intention. To hold otherwise would invalidate the entire arbitration agreement merely because of obvious drafting inaccuracies—a result contrary to the settled pro- arbitration approach adopted internationally.

7. Public policy

32. The learned District Judge further held that enforcement would  be  contrary  to  the  public  policy  of  Bangladesh. However, the judgment contains no discussion whatsoever identifying  what  principle  of  Bangladeshi  public  policy would  be  violated.  Merely  reproducing  the  expression "public policy" cannot satisfy section 46.
33. The  public  policy  exception  is  reserved  for  exceptional cases involving fraud, corruption, denial of natural justice,

or  violations  of  the  forum's  most  fundamental  legal principles. No such circumstance has been demonstrated here.

34. On  the  contrary,  Bangladesh,  by  incorporating  the  New York  Convention  into  the  Arbitration  Act,  2001,  has adopted  a  legislative  policy  favouring  recognition  and enforcement of foreign arbitral awards. That policy would itself be undermined if enforcement were refused without any legally sustainable ground.

VIII. Compliance with Section 45

35. The learned District Judge further erred in holding that no proper petition under section 45 had been filed. The record unmistakably  shows  that  the  appellant  instituted  Money Execution  Case  No.  15  of  2018  under  section  45  and produced:1) the authenticated copy of the Award; 2) the arbitration agreement; and 3) the documents proving that the Award was a foreign arbitral. These are precisely the documents required under section 45(2). The Act nowhere requires two separate proceedings—one for recognition and another for execution. The learned Judge therefore imported into  the  statute  a  procedural  requirement  which  the legislature never enacted.
36. This  court  is  of  the  view  that  since  the  respondents admittedly  received  notice  of  the  arbitral  proceedings, failed to appoint their arbitrator within the stipulated time, participated  through  solicitors  without  challenging  the tribunal's jurisdiction before the competent English court, and since no ground under section 46 of the Arbitration Act,  2001  was  established,  the  learned  District  Judge exceeded his jurisdiction by reappraising the merits of the award, holding that the arbitrator committed errors of fact and law, and purporting to set aside the foreign arbitral award. The impugned order, therefore, cannot be sustained and the Award is entitled to recognition and enforcement under section 45 of the Arbitration Act, 2001.

IX. Conclusion

37. Viewed  from  any  angle,  the  impugned  order  cannot  be sustained.  The  learned  District  Judge  misconceived  the scope of sections 45 and 46 of the Arbitration Act, 2001, assumed  an  appellate  jurisdiction over  a  foreign  arbitral award which the statute does not confer, purported to set aside an award over which he had no supervisory authority, relied upon findings unsupported by the record, and refused enforcement  without  establishing  any  of  the  limited statutory grounds recognised by section 46.
38. The impugned order, therefore, suffers from patent errors of law,  jurisdictional  overreach  and  material  illegality warranting interference by this Court. The foreign arbitral award  dated  29.11.2015  is  accordingly  entitled  to recognition  and  enforcement  under  section  45  of  the Arbitration  Act,  2001,  and  the  order  dated  08.01.2024 passed by the learned District Judge is liable to be set aside.
39. Accordingly-

1.                 The appeal is allowed.

2.                 The judgment and order No. 25 dated 08.01.2024 passed by  the  learned  District  Judge,  Dhaka, in Money Execution Case No. 15 of 2018 is hereby set aside.
3.                 It  is  declared  that  the  learned  District  Judge exceeded the jurisdiction conferred by sections 45 and 46 of the Arbitration Act, 2001 in purporting to  set  aside  the  foreign  arbitral  award  dated 29.11.2015. The said part of the impugned order is without lawful authority and of no legal effect.
4.                 This Court further holds that none of the statutory grounds  contemplated  under  section  46  of  the Arbitration Act, 2001 for refusing recognition or enforcement of a foreign arbitral award has been established by the respondents. Consequently, the foreign arbitral award dated 29.11.2015 rendered by the Sole Arbitrator, Mr. Graham Clark, London, is entitled to recognition and enforcement under section 45 of the Arbitration Act, 2001.
5.                 The  foreign  arbitral  award  dated  29.11.2015  is hereby  recognized  and  declared  enforceable  in Bangladesh and shall be deemed to be a decree of the Court within the meaning of the Arbitration Act, 2001.
6.                  Money Execution Case No. 15 of 2018 is restored to  its  original  file.  The  Executing  Court  shall proceed with the execution of the foreign arbitral award in accordance with law and shall take all consequential  steps  for  realization  of  the  award amount together with such interest, costs and other amounts as are recoverable under the Award.

40. The parties shall bear their own costs of this appeal.
41. Let a copy of this judgment along with the lower court records  be  transmitted  to  the  learned  District  Judge, Dhaka, forthwith for information and necessary action.

(Justice Md. Toufiq Inam)

Ashraf/ABO.