Owing to India’s huge and highly competitive business industry, business disputes are on a rise. While the resolution of disputes through process of the court can be tedious and lengthy, Arbitration provides for a comparatively easier and economical solution. While arbitration enables businesses to settle their disputes expeditiously, at the same time, it is important to have the best arbitration lawyers onboard especially in cases where the stakes are high. Unfortunately, a lost case in arbitration can bring irreversible losses. A seasoned arbitration lawyer can rightly guide through the process of arbitration and can help make a substantial difference in the result of the case.
Arbitration is a process of dispute resolution between the parties and an effective alternative to litigation. It is governed by “The Arbitration and Conciliation Act, 1996”. The process of arbitration can commence only if there exists a valid Arbitration Agreement between the parties prior to the emergence of the dispute. Such an agreement must be in writing. The contract, concerning which the dispute arises, must either contain an arbitration clause or must refer to a separate document signed by the parties containing the arbitration agreement. The existence of an arbitration agreement can also be inferred by written correspondence such as letters, telex, telegrams, emails etc. which provide a clear record of such agreement.
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The concept of arbitration in India is not a new concept. India has had a long tradition of arbitration. In ancient India, in case any dispute arose, people chose to settle the matter on their own. In fact, there were different grades of arbitrators with provisions for appeals in certain cases from the award of a lower grade of arbitrators to arbitrators of the higher grade.
You may find the history of arbitration law in India a quite amusing one.
Before Arbitration was recognized by the Code of Civil Procedure, arbitration was encouraged as a mode of settlement of disputes by the Bengal Regulation of 1772, 1780, 1781 and the Cornwallis Regulation of 1787. Thereafter, the Bengal Regulation of 1793, the Madras Regulation of 1816 and the Bombay Regulation of 1827 provided for arbitration. Again in the years 1877 and 1882, the concept of arbitration was found in Codes for Civil Procedure. However, there was no notable change in the law relating to arbitration in these amendments.
In the year 1899, the Indian Arbitration Act came into force which specifically dealt with laws relating to Arbitration, but, the Act did not apply to disputes which were a subject matter of suits. The scope of this Act was only limited to arbitration agreements and that too only in Presidency towns. In the year 1908, the Civil Procedure Code was amended and pursuant to the amendment the limit of arbitration to only Presidency Towns was removed.
In the mid-1920s, the Civil Justice Committee was appointed to report on the machinery of “civil justice in the country” which made suggestions for modification of arbitration laws. However, owing to anticipation of taking cues from the British Arbitration Laws, it was finally in 1938 that the Government of India appointed an officer to revise the Arbitration Law. As a result, the first Arbitration Act of the country was enacted in 1940.
The scope of the 1940 Act remained silent on the execution of foreign awards. In fact a separate law and Foreign Awards (Recognition and Enforcement) Act, 1961 was applied to the enforcement of awards under the Geneva Convention, 1927 and New York Conventions to which India was a signatory. Over time, the working of the 1940 Act was found to be unsatisfactory due to too much court intervention.
In 1977, the functioning of the 1940 Act was questioned and examined by the Law Commission of India on grounds of delay and hardship caused due to clogs that affect smooth arbitral proceedings. The Commission instead of reworking the entire framework of the Act recommended amendment of the provisions, consequent to it. The Arbitration and Conciliation Act, 1996, was enacted by keeping in mind the 1985 United Nations International Commission on International Trade Law (UNICTRAL) model law and rules.
However, the amendment Act of 1996, did not solve the main purpose to remove the practical problems. Various Committee reports like highlighted these challenges, check out some of them.
Ultimately the Arbitration and Conciliation (Amendment) Act, 2015 brought in crucial changes to the 1996 statute to overcome the shortcomings.
For more information and professional consultation regarding arbitration matters, our expert arbitration lawyers in Chandigarh can be contacted from Monday to Friday between 10:00 am to 6:00 pm and between 10:00 am to 2:00 pm on Saturdays.
First and foremost, one must know the process of invocation of arbitration to avoid any ambiguity.
The grounds of the challenge of an arbitrator are mentioned in section 12 of the amendment Act of 2015.
After the arbitration proceedings are initiated the parties lead their defense and their evidence, and, thereafter, an arbitral award is passed. Arbitration is an alternative method of dispute resolution and accordingly, the award is to be passed within twelve months from the date arbitral tribunal enters upon the referral. And then this period of twelve months can be extended up to six months by the written consent of both parties. However, if the proceedings are not completed within the extended period, the mandate of the arbitrator shall terminate unless the Court has, either prior to or after the expiry of the period so specified, extend the period.
|Notice for invoking arbitration and reply by another party|
Composition of Arbitral Tribunal
Section 10, 11
|Appointment of arbitrator/s|
Conduct of Arbitral Proceedings
Section 18, 19, 20, 22
|Equal treatment of parties, determination of rules and procedure, place of arbitration, language.|
Section 21, 24
|Commencement of Arbitral Proceedings, hearing and written proceedings|
Interim measures by court and the arbitral tribunal
Section 9, 17
|Interim reliefs in aid of arbitration|
Statement of claims and defense
Section 23, 24
|Oral Hearings and written proceedings|
Making or arbitral award and termination of Arbitral Proceedings
Section 31, 32
|Arbitral Award and termination of Arbitral proceedings|
Recourse against Arbitral Award
|Challenge the award of the arbitrator|
Finality and enforcement of Award
Section 35, 36
|Execution of Award passed by the arbitrator|
|Appeals to Appellate Court and Supreme Court of India|
Radha Chemicals v. Union of India Civil Appeal No. 10386 of 2018
The Supreme Court reaffirmed its stand was taken in Kinnari Mullick and Another vs. Ghanshyam Das Damani, (2018) 11 SCC 328. It was held that the court while deciding a Section 34 petition has no jurisdiction to remand the matter to the Arbitrator for a fresh decision. Further, it was held that the discretion of the Court under Section 34(4) to defer the proceedings for specified purpose is limited. And it can be invoked only upon request by the party prior to setting aside of the Award.
M/s Emkay Global Financial Services Ltd. v. Girdhar Sondhi Civil Appeal No. 8367 of 2018
The court held that an application for setting aside an arbitral award will not ordinarily require anything beyond the record that was before the Arbitrator. However, if there are matters not contained in such record, and are relevant to the determination of issues arising under Section 34(2)(a). They may be brought to the notice of the Court by way of affidavits filed by both parties. Cross-examination of persons swearing to the affidavits should not be allowed unless absolutely necessary. As the truth will emerge on a reading of the affidavits filed by both the parties.
Anilkumar Jinabhai Patel (D) V Pravinchandra Jinabhai Patel Civil Appeal No. 3313 of 2018 arising out of SLP (C) No.15668 of 2012
Limitation period prescribed under Section 34(3) of the Arbitration Act, 1996 would commence only from the date of the signed copy of the award delivered to the party making the application for setting it aside. Further, the court held that Section 31(5) of the Act requires a signed copy of the award to be delivered to each party.
P Radha Bai v Ashok Kumar 2018 SCC Online SC 1670
The court held that the phrase “but not thereafter” in Section 34(4) of the Act nails the legislative intent of giving “finality” to the Arbitral Award by fixing an “outer boundary period” for challenging an award.
M/s Simplex Infrastructure Ltd. v Union of India 2019 2 SCC 455
In this case, the court held that the statutory time limit to challenge an Arbitral Award has to be strictly adhered to.
M/S Lion Engineering Consultants v State of M.P. & Ors. Civil Appeal NOS. 8984-8985 OF 2017
The Hon’ble Supreme Court has held that the public policy of India refers to the law in force in India whether State law or Central law. Further, the court held that there is no bar on the plea of jurisdiction being raised by way of an objection under Section 34 of the Arbitration Act, 1996 even if no such objection was raised under Section 16.
The State Of Bihar & Ors. v. Bihar Rajya Bhumi Vikas Bank Samiti Civil Appeal No. 7314 of 2018
Contrasting Section 34(5) with Section 80 of the Code of Civil Procedure, the court observed that to construe such a provision as being mandatory would defeat the advancement of justice. And therefore, prior notice to other parties before filing an application to set aside an arbitral award is not mandatory and is merely directory.
Shriram EPC Limited v. Rioglass Solar SA 2018 SCC Online SC 1471
The Supreme Court held that since a foreign award, is not contained within the expression “award” in Item 12 of Schedule I, it is not taxable under the Indian Stamp Act, 1899. And thus, non-stamping of the foreign award would not render it unenforceable under section 49 of the arbitration act.
Disputes settlement is not an easy skill to grasp. A law degree is not the only thing that makes one a proficient arbitration lawyer. One who is good at managing people, understanding their matters and manipulating available resources to help them reach suitable reconciliation, can prove a successful arbitration lawyer. Most probably, these arbitration matters are related to commercial disputes. Among top law firms in Chandigarh, B&B Associates is an eminent entity in the region which is redressing a number of disputes in arbitration matters.
B&B Associates LLP offers impeccable legal services in Chandigarh and the attorneys here are thoroughly conversant with the law. Our arbitration experts in Chandigarh High Court investigate the entire matter to look before every facet of the dispute. Our team is quick-witted and assiduous which are few of the major must-have qualities of a lawyer. Among top arbitration lawyers in Chandigarh, our proficient advocates are preferred.
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