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Arbitration is an Alternate Dispute resolution (ADR) to resolve the matters outside the Court with the consent of both parties in a lesser time and cheaper way. The dispute is decided by the Arbitral tribunal headed by one or more Arbitrators to decide the matter. The arbitrators render the “arbitration award” in accordance with law by following the principle of Natural Justice. It is enforceable by law and legally binding to both parties. The arbitration is mostly invoked for the commercial disputes among the international arbitration transactions. A few examples of Internationally established institutions to deal with arbitration are the International Chamber of Commerce, Singapore International Arbitration Centre, London Centre of International Arbitration and Hong Kong International Arbitration Centre.
Indian Council for Arbitration (ICA) was established in the year of 1965 and aims to provide speedy and cheaper solutions by means of arbitration, conciliation etc. regardless of the location. This initiative of the government has proved its efficiency and importance worldwide. The ICA has its arbitrations centres around the globe and resolves the disputes with the best satisfaction. The ICA managed to deal with over 400 domestic and international arbitration cases in the Asia Pacific region per year. It also provides the commercial world with unrivalled and time-tested Maritime Arbitration services and imparts education and training in alternative dispute resolution mechanisms. Coupled with our quality case administration and panel of arbitrators, ICA is the one resource for all your dispute resolution needs. The major arbitration institution of India is Mumbai Centre for International Arbitration and Nani Palkhivala Arbitration Centre.
In India, the laws relating to arbitration are related to The Arbitration and Conciliation Act, 1996. The act deals with both kinds of arbitration settlements i.e. within the territory of India and outside India. The act clearly provides the establishment, composition, jurisdiction of the tribunal and provides the procedure, conduct, making of arbitral awards to be performed. The second part of the act which deals with the provisions related to the enforcement of certain foreign awards specifically provides the procedure related to the nation like New York Convention Awards, Geneva Convention Awards and Conciliations, etc. the act has been amended various time, recently it was amended in the year 2019 after the previous amendment of the year 2015 when the upper limit the arbitral proceedings was set for one year. The Indian Arbitration Act follows the UNCITRAL Model Law on International Commercial Arbitration (1985). The act gets the authority by the arbitration clause in the contract among the parties. The arbitration clause must be clear and specific about the intention of the parties and the procedure and laws to be followed during the arbitration process. The arbitrators must be in the odd numbers (as per the Indian Laws) and must be unbiased independent well-educated person to resolve the dispute.
The appointment of an arbitrator is an important part of the process as it is necessary to ensure unbiasedness and fairness in the judgement. The arbitrator is given various powers like to make awards, take assistance, rile on its jurisdiction, pass interim relief, to determine procedures, to decide official language, the appointment of an expert, court’s assistance of for evidence, terminate proceedings, impose interest and deposition, etc. and the prevention of miss-use of these powers are lies in the appointment of the Arbitrator. The Arbitrator can be removed on various grounds like the existence of circumstances and facts that gives rise to doubts as to the arbitrator’s impartiality and independence and Lack of the qualifications agreed between the parties etc.
The Arbitration Act has certain clauses which are mandatory in nature to make it uniform and effective. The necessity of the arbitration includes the arbitration agreement with the reference of courts, number of arbitrators, language, grounds of challenge the award, grounds of presumed impartiality, and time limit for compelling arbitration proceedings. These are made necessary to save time during the proceedings and achieve an effective solution. The arbitration can resolve various issues related to Criminal offenses, Matrimonial disputes, Guardianship matters, Insolvency petitions, Testamentary suits, Trust disputes, Labor and industrial disputes, Tenancy and eviction matters, and so on.
The basic requirements to invoke the arbitration clause are given in section 7 of the Act, which states that the document of the contract must be duly signed by both the parties, with the proper exchange of correspondence which provides a record of the agreement and the exchange of statement of claim and defense containing an undisputed acknowledgment of the agreement. Only after the fulfillment of these, the parties can invoke the clause in the case of a dispute.
The Arbitration act also provides the Interim relief by the arbitrator tribunal in the case related to the issues like appointment of a guardian for a minor person or a person of unsound mind for the purpose of arbitration proceedings, can pass an interim order for the custody or sale of the disputed goods, can also order the detention, preservation or inspection of the disputed property, can also order for interim injunction and the appointment of receivers, etc.
The Arbitration Tribunal is empowered to grant various reliefs including Declarations, Injunctions, Payment of money, and other specific performance with may deem. Arbitration awards given are categorized into two categories i.e. Domestic and Foreign. For the Domestic Arbitration Award, the expiry is of 90 days which may subject to stay upon submitting an application for that. Further, the party reserves the right to file an execution petition in the civil court as per the civil procedure court. For the Foreign Arbitration Award, the procedure is almost the same but it does not provide any limitation for the enforcement of the foreign award. The law of limitation is applied to both i.e. civil suits and arbitration proceedings.
Along with the various relaxing measures of ADR like time and money-saving, parties settlement, selection of arbitrator there are some backlogs are interference of court, no provision for specialist arbitration bar, and lack of paper transcriptions facilities in India. The issues need to be addressed immediately and adequate measures should be taken by the legislature.
Summing up, India’s Arbitration system achieves the grand success of resolving the disputes without going to the Court in a very less time and cost it provided the best solution. The Indian system established its valuable place at the international level and moving ahead with the improved and better arbitration system. The various amendments in the recent past made it more practically applicable and convenient to the parties.
