Afghanistan’s embassy told the Supreme Court that it was not able to get instructions from Kabul due to the regime change in the country.

The firm subsequently initiated arbitration to get its payments. The matter reached the Supreme Court which allowed the firm to appoint a sole arbitrator, who ruled in the favour of the Delhi firm. For execution of the arbitrator’s award of November 2018, the firm went up against the embassy in the Delhi High Court where the question raised was whether an arbitration award can be enforced against a foreign country and if the consent of the central government was required to enforce it under the Code of Civil Procedure.

On June 18 this year, the Delhi High Court held that prior consent of central government will not be necessary and ruled that “a foreign state cannot claim a sovereign immunity against enforcement of an arbitral award arising out of a commercial transaction.”

The embassy approached the Supreme Court on August 10 against this ruling. The high court order required the embassy to deposit a sum of over ₹1.72 crore within four weeks with the high court registry. It was also required to file its affidavit of assets as on the date of the cause of action, date of the award and the date of the High Court judgment. The embassy claimed it was never agreed to the arbitration being done in Delhi since the seat of arbitration was Kabul, Afghanistan and thus no enforcement of the Arbitral Award was applicable to it.

As the matter came up on Thursday before the bench of Justices Vineet Saran and Dinesh Maheshwari, the lawyer appearing for the embassy sought an adjournment in view of the regime change in Kabul and the mission’s inability to get instructions from the new regime under the Taliban.

Lawyer Ejaz Maqbool, counsel for the Embassy of Islamic Republic of Afghanistan, sought six weeks. “There is a regime change in Afghanistan and the entire country is in a state of turmoil and I am not able to get further instructions from the Ambassador and from the embassy located in New Delhi. I will be requesting for an adjournment of six weeks,”Maqbool said in his request for an adjournment.

"Do you think that situation will be settled in six weeks?" asked the bench.

Advocate Ejaz Maqbool, representing the Embassy of Afghanistan, responded, "No, but at least I will be able to get instruction from the new regime. We should pray that things will be settled.”

The legal dispute between the Embassy and a Delhi-based construction contractor has been ongoing since 2010, following repairs and refurbishment of the embassy premises. The embassy and the contractor had been locked in a legal battle over whether the arbitration can be carried out in India or should have gone to Kabul. Recently, the Delhi High court passed an order in favour of the contractor, and the Embassy of Afghanistan filed an appeal before the Supreme Court.