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Introduction The whole purpose of Arbitration and Conciliation is speedy and cost effective dispute resolution. Just imagine, if every arbitral award is allowed appeal ? First Matter will go to High Court, then Supreme Court, and it will take years. It would defeat the whole purpose of arbitration and conciliation. Therefore, act provides extremely limited grounds on which arbitral award can be challenged. These grounds are covered under section 34 of the act. There are other grounds discussed in section 13 and section 16 which deals with challenging a procedure and challenging a jurisdiction of arbitral tribunal respectively. Challenge to procedure or arbitrator (Section 13) Section 12 mandates that arbitrator should disclose any relationship with any parties for impartiality. If it appear to any party of any relationships or doubt abut arbitrator, then appointment can be challenged. Such an appointment should be first challenged before arbitral tribunal. If this challen...

Introduction It is a conclusive determination of question, issues or dispute brought forward to the arbitral tribunal. Tribunal will give reasonable opportunity to all parties, it will hear all parties then finally come to conclusion about award or final decision. In earlier post, wherein we have discussed proceedings of arbitration, we know one party submit for claim and other party defend it. Arbitral award is final determination, whether to grant a claim, or refuse a claim, or a decision about rights and liabilities of parties in disputes which are brought forward to arbitral tribunal. Below are some actions which arbitral tribunal can take based on proceedings, hearing and evidence produced before it. the tribunal may order the payment of a sum of money (conventional damages) the tribunal may make a "declaration" as to any matter to be determined in the proceedings in most jurisdictions, the tribunal has the same power as a court to:  order a party to do o...

What if parties who selected Arbitrator don't like the arbitrator ? What if Arbitrator don't like the parties ? Can arbitrator be removed ? Section 12 to 15 answers above questions. Below are the ways by which arbitrator is terminated. Voluntary withdrawal by arbitrator Arbitrator may not like an issue, which could turn out more complex, or he may feel that remuneration is not enough, in those cases he can voluntary withdraw from arbitration proceedings. Section 14 clause 3 have provision related to this, and clause 1 of Section 15. It's not mandatory for arbitrator to disclose the reason for withdrawal. All party agree that Arbitrator is not good ,or should be removed For whatever reason, like Arbitrator is not attending hearing on time, is unable to understand the dispute etc, if both parties agree that arbitrator should be removed, then arbitrator has to go Operation of Law Arbitrator is unable to continue For some reason like health emergency ...

Introduction Chapter V of the Part I of Arbitration and Conciliation Act provides for how to conduct arbitral proceedings. This chapter also provides for some care to be taken by Arbitrator, his powers etc. It discusses about place of arbitration, language of proceeding among others. Provision Section 18-Equal treatment to parties Arbitral Tribunal or arbitrator will treat both the parties on par. He is not supposed to go on a drink with one party only. It will give rise to the doubt about partiality. Section 19- What should be rules of arbitral proceedings If parties have agreed for any procedure, then such procedure will be followed Arbitration Proceedings will not be bound by Civil Procedure Code,1908 as well evidence law also will NOT be applicable(Indian Evidence Act) If there is no agreement between parties as to procedure, then arbitrator will determine the procedure which will be suitable for both the parties, and which arbitrator thinks awesome! Arbit...

Duties Arbitrator is under obligation to do below things Conduct or proceedings without delay Whole point of arbitration is Speedy and less expensive remedy. Hence arbitrator has to carry of the process without delay, so that parties are happy in the end. Section 18-Treat both the parties equally "Justice should not only be done, but  should appears to be done". Section 18 provides that both parties should be give full opportunity to present their cases. Impartiality and non-bias are sine qua non for any proceedings, as biased outcome is no outcome. Keep all matter confidential Arbitrator has duty to keep all matter confidential as this is private adjudication. He should maintain the privacy as there are stakes of both the parties in keeping some fact secret. If Mr Ambani is involved in some arbitration proceeding and feels that few things should not come out in public as it will affect share prices etc, then arbitrator is bound to keep these secret....

Nationality Doesn't matter! Arbitrator could be of any nationality. This is important in case of international arbitration, wherein there are chances of bias if arbitrator of any nationality of parties is selected. If Nirav and Andrew have dispute, if Indian arbitrator is chosen there could be bias. So some arbitrator from Rwanda or Uganda would make whole arbitration process bit fair. Capacity to contract Arbitrator should have capacity to contract. Arbitration is private adjudication and arbitrator have some duties as well as obligation. Therefore it's necessary that he is able to carry duties and obligation and hence must be capable to contract. Lack of Bias Arbitrator shouldn't have prejudices towards any party. Repercussion of this is huge, as arbitral award could be challenged if it proved that arbitrator was biased. Section 12-Grounds for challenge When person is approached by parties to act as an arbitrator, section 12 provides that such person s...

Introduction After parties decide to submit their dispute to arbitration, Who will give judgement on their dispute ? Of course Arbitrator. How these arbitrators are appointed ? What procedures are followed for appointment of these arbitrators ? If any of the arbitrator is not acting impartially can he be removed ? Chapter 3, Part 1 of Arbitration and Conciliation act from section 10-15 deals with all of these question. Arbitration Tribunal First, Arbitration Tribunal and Arbitrator are same terms. They can be used interchangeably. Section 2(1)(d) of the act defines as a sole arbitrator or a panel of arbitrators. Arbitration tribunal is nothing but a adjudicating body deciding upon the disputes submitted to them. They have certain powers and act in quasi judicial capacity. These tribunals are not courts. Many  a times government establishes a statutory bodies like National Green Tribunal who decides cases related to environment. Who is Arbitrator ? In...

Introduction We will discuss below things  Appointment by Parties Appointment by Parties and Authorities  Appointment by Authorities Procedure by Parties Parties are given free hand to apply any procedure for appointment of arbitrators. Section 11 clause 2 provides that Subject to sub-section(6), the parties are free to agree on a procedure for appointing the arbitrator or arbitrators. Arbitration institutes when applied to them, can provide the arbitrators as per the procedure of these institutes. Appointment can be done in below ways. For example if party needs 3 arbitrators. Each party will appoint one arbitrator. This appointed arbitrator will choose third one Or, Other institution like FICCI, Chamber of Commerce etc will appoint if parties have agreed that arbitrator should be appointed by these institutions Now what if, parties have decided to go to arbitration but haven't decided about the procedures of appointment Or they decided the proc...

Introduction Arbitration is method of dispute resolution between the parties. Parties are king in a sense that they can decide judge(Arbitrator), procedure, extent to which arbitration should apply and disputes which may be submitted to arbitration. All this arrangement as to arbitrator, procedure, extent and types of disputes are in form of arbitration agreement. Arbitration agreement is whole and sole of entire process. What is this "Arbitration Agreement" ? What are valid agreements ? How can this agreements be terminated ? Why should we even study this ? Well, we will try to find answers to these questions in this blog. What is "Arbitration Agreement" ? For example, Mr Nirav and Mr Mallya enter into contract, where Mr Mallya is seller who agrees to supply 100 cans of Kingfisher beers daily to Mr Nirav of certain quality. Following things could happen Mr Mallya could supply cow urine saying it's beer! Mr Mallya could supply low quality...

Consent Whole process is based on consent of parties. Consent for what ? For below things Submit the dispute to arbitrator. Includes desire of both the parties Appointment of arbitrator or Arbitral tribunal Procedures, rules, place etc. All these agreements are mentioned in arbitration agreement. Consent is at center stage at any arbitration or conciliation. Autonomy and Flexibility When parties enter into some commercial contract, they can decide where they want to carry their arbitration proceedings. They can carry out proceedings in London in case of institutional arbitration by choosing an Institution in London, or they can go to nearby theater, get a ticket of boring movie and carry out arbitration proceedings in empty theater. Act offers enormous flexibility to parties to choose there place, procedure and even law!   Finality of Judgement General rule is, decision in Arbitration is binding on both parties. There are very limited grounds on whic...

Definition Arbitration and Conciliation Act, 1996 don't have definition of what "Arbitration" is. However there is clause 2(1)(a) which states as follows: "Arbitration" means any arbitration whether or not administered by permanent arbitral institution. It merely states that it includes any arbitration by permanent bodies like XYZ Chamber of Commerce or arbitration by ad-hoc members. Check out the starting of clause, "Arbitration mean any arbitration...", meaning we have to seek definition from somewhere else! As we know, Arbitration and Conciliation Act, 1996 is based on UNCITRAL model arbitration and conciliation law. Sadly it doesn't have definition either! We will put out two definitions, one is literal meaning and other by Halsbury (Law encyclopedia). In literal sense it means "settlement of differences and dispute, by a third person(Arbitrator) whose decision would be binding on parties to dispute". Decision of arbitr...