The freedom to contract principle forms the basis of the Contract Act, and a similar principle is also provided for in the Arbitration and Conciliation Act. However, the question often arises as to what happens when one party – despite a contractual agreement setting out the scope and ambit of arbitration – seeks recourse to remedies provided for under a special statute. This article examines this issue in view of the Micro, Small and Medium Enterprises Development Act.
It is common knowledge that arbitration provides greater flexibility and party autonomy compared with traditional litigation before the courts. Corollary to this, the agreed terms for the appointment of an arbitrator or arbitral tribunal must be strictly followed while making such appointments if a dispute arises between the parties to an agreement. However, what happens when an arbitrator fails to or is prevented from acting specifically at the penultimate stage?
In 2013 the Supreme Court held that the enforcement of a foreign arbitral award can be refused only if it is contrary to, among other things, the 'fundamental policy of Indian law'. This article focuses on the Indian courts' interpretation of this term and looks at a common question that arises in relation to this area of law – namely, whether a foreign arbitral award which is a mere violation of an Indian legal provision qualifies as a contravention of the fundamental policy of Indian law.
Two-tier arbitration clauses or appellate arbitration mechanisms were upheld by a three-judge bench of the Supreme Court in Centrotrade Minerals and Metal Inc v Hindustan Copper Limited. This article discusses the evolution of the jurisprudence surrounding two-tier arbitration in India and analyses both the utility of such a mechanism for the parties and its usefulness in certain situations.
Before its amendment in 2015, the Arbitration and Conciliation Act 1996 neither promoted institutional arbitration nor discouraged parties from considering it. The 2015 amendment was an attempt to reduce judiciary intervention in arbitration proceedings and promote a culture of institutional arbitration. One of the proposed changes was the amendment to Section 11 of the 1996 act, which provides for the appointment of arbitrators by the competent court.
Following the enforcement of the Arbitration and Conciliation (Amendment) Act 2015, the Arbitration and Conciliation (Amendment) Bill 2018 proposes to further amend the Arbitration and Conciliation Act 1996. The bill is another step by policymakers towards making India "a robust centre for international and domestic arbitration" and attempts to make it an investor-friendly jurisdiction and a preferred seat of arbitration for dispute resolution.
The independence and impartiality of arbitral tribunals is significant in order to encourage faith and trust in litigants and ensure that disputes are independently, impartially and fairly adjudicated. Against this backdrop, the enforceability of contracts between private parties and government entities must be considered, as such entities often appoint arbitrators who act with such inflexibility as essentially to render arbitration agreements redundant and the required consent of the parties meaningless.
The Delhi High Court recently addressed a unique jurisdictional issue regarding the applicability of an incorrect provision of the Commercial Courts Ordinance which was retrospectively corrected by the Commercial Courts Act. However, the retrospective application of the Commercial Courts Act has raised concerns which must be clarified to ensure a smooth transition from the Commercial Courts Ordinance to the Commercial Courts Act.
The Arbitration and Conciliation (Amendment) Ordinance, 2015 – which provides for less cumbersome, more cost-effective, efficient and expeditious dispute resolution – has been welcomed by litigants. However, more clarity is needed with regard to the ambiguities in the new Section 11 – in particular, in relation to the scope and applicability of the Fourth Schedule and the model fee structure payable to arbitrators.