Glossary

What is enforcement of an arbitral award?

Winning an arbitration is half the job; the award then has to be converted into money. Under Section 36 of the Arbitration and Conciliation Act, 1996 an award is enforced like a court decree, and since 2015 a challenge does not automatically stop enforcement.

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Short answer

Once the three-month period for a Section 34 challenge (extendable by 30 days) has passed, or a challenge has been refused, an arbitral award is enforced under Section 36 in the same manner as a decree of the court under the Code of Civil Procedure, by filing an execution petition in the court where the judgment debtor has assets. A pending Section 34 application does not by itself stay enforcement; the court may grant a stay on conditions, usually a deposit. For MSEFC awards, the buyer must deposit 75% before even filing the challenge.

How enforcement works in India

  1. Award delivered; the three-month challenge window starts from receipt of the signed award.
  2. If no challenge is filed (or the deposit for an MSEFC award is not made), the award becomes enforceable.
  3. File an execution petition under Order XXI CPC with a certified copy of the award, in the court where the buyer's bank accounts, receivables or property are located.
  4. Seek attachment of bank accounts (garnishee), receivables, movable or immovable property; the court can also summon the judgment debtor to disclose assets.
  5. Sale of attached property, or payment by the buyer to lift the attachment.

Why it matters for getting paid

An award is not self-executing; a buyer determined to delay will wait to be compelled. The post-2015 rule that a challenge does not stay enforcement, and the deposit conditions courts impose, mean the money is usually secured within months of the award. For MSME suppliers, the 75% deposit makes a Council award close to cash. Read decree and execution, garnishee order and attachment of property.

How FundRaksha uses it

FundRaksha's advocates do not stop at the award: they prepare the execution petition with the buyer's bank details and asset information gathered during the case, and move for garnishee orders on the first date. This is how the awards become part of the 700+ businesses actually paid. Fee: 30% of the amount recovered.

Worked example (hypothetical)

The Karnataka Facilitation Council awards a Bengaluru component maker ₹12,00,000 principal plus ₹2,56,000 Section 16 interest on 1 March. The buyer wants to challenge but must first deposit 75% of ₹14,56,000, that is ₹10,92,000. It does not. The challenge window closes on 1 June (plus a possible 30 days). On 10 July the maker files an execution petition in the Delhi court where the buyer banks, with a garnishee application against the buyer's current account. The court attaches ₹14,56,000 plus post-award interest; the buyer pays the full amount within three weeks to release its account.

Last reviewed: 2026-10-08. Information for Indian businesses; not legal advice.

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  • A review of your invoices, purchase orders, delivery proof and the buyer’s replies
  • An honest assessment of recovery chances and the right route: reminders, legal notice, MSME Samadhaan, Section 138 or a civil suit
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  • Purchase order, delivery challan, e-way bill or proof of service
  • Messages, emails or letters about the payment
  • For a bounced cheque: the cheque and the bank return memo

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FAQ

Questions, answered

No. Under Section 36, once the challenge period has passed or the challenge is refused, the award is enforced directly as a decree without a separate confirmation suit.

This page is general information for Indian businesses, not legal advice for your specific case. Laws, rates and procedures change; speak to an advocate before acting. FundRaksha LegalTech Pvt Ltd is a technology company; legal work is carried out by enrolled advocates.