Introduction to Procedural Aspects
The Arbitration and Conciliation Act, 1996, provides a detailed procedural framework for conducting arbitration in India. This chapter will focus on the commencement of arbitration, interim relief by the court and the arbitrator, hearings and proceedings, and fast track procedures and timelines.
Commencement of Arbitration Procedural Aspects
The commencement of arbitration is governed by Section 21 of the Arbitration and Conciliation Act, 1996. Arbitration proceedings are deemed to commence on the date on which a request for that dispute to be referred to arbitration is received by the respondent.
The Supreme Court in M/s Chatterjee Petrochem (India) Pvt. Ltd. v. Haldia Petrochemicals Ltd., (2014) 14 SCC 5741, held that the date of commencement of arbitration is not necessarily the date on which the arbitrator is appointed, but the date on which a request for that dispute to be referred to arbitration is received by the respondent.
Relevant Provision: Arbitration and Conciliation Act, 1996 – Section 21
Interim Relief by Court and Arbitrator
Section 9: Interim Measures by Court
Section 9 of the Act allows a party to apply to the court for interim measures of protection. The court has the discretion to grant such measures before or during arbitral proceedings.
The Supreme Court in Arcelor Mittal Nippon Steel India Ltd. v. Essar Bulk Terminal Ltd., (2021) SCC Online SC 6532, held that subsequent to the constitution of an arbitral tribunal, court would not consider and/or apply its judicial mind to any application for interim reliefs under Section 9 unless and until it is established that the remedy from an application to the tribunal is inefficacious.
Relevant Provision: Arbitration and Conciliation Act, 1996 – Section 9
Relevant Provision: Arbitration and Conciliation Act, 1996 – Section 9
Section 17: Interim Measures by Arbitrator
Section 17 empowers the arbitral tribunal to pass interim orders during the pendency of proceedings. These orders are enforceable as if they were court orders.
The Supreme Court in Alka Chandewar v. Shamshul Ishrar Khan, (2017) 16 SCC 1193, held that an order passed by an arbitral tribunal under Section 17 would be enforceable under the Code of Civil Procedure in the same manner as if it were an order of the court.
Relevant Provision: Arbitration and Conciliation Act, 1996 – Section 17
Hearings and Procedural Aspects
The Act provides flexibility in the conduct of hearings and proceedings. Section 24 outlines that the parties are free to agree on the procedure, failing which the arbitral tribunal may conduct the proceedings in a manner it considers appropriate.
The Supreme Court in M/s Lion Engineering Consultants v. State of M.P., (2018) 16 SCC 4664, held that an arbitral tribunal has wide discretion in conducting proceedings and can adopt any procedure which is fair and reasonable. However, such discretion must be exercised within the bounds of natural justice and due process.
Relevant Provision: Arbitration and Conciliation Act, 1996 – Section 24
Fast Track Procedure and Timelines
Section 29B: Fast Track Procedure
The Act introduces a fast track procedure under Section 29B, where parties can agree to resolve disputes within a period of six months from the date the arbitral tribunal enters upon the reference.
The Delhi High Court in M/s Jindal ITF Ltd v. NTPC Ltd., (2019) SCC Online Del 80325, held that parties can opt for fast track procedure even after commencement of arbitration proceedings, provided they do so with mutual consent and without prejudice to their rights or claims.
Relevant Provision: Arbitration and Conciliation Act, 1996 – Section 29B
Timelines
The Act, through various amendments, has introduced strict timelines for the arbitral process. For instance, an award is expected to be made within 12 months from the date the arbitral tribunal is constituted, extendable by a further six months.
The Supreme Court in Haryana Space Application Centre v. M/s Pan India Consultants Pvt Ltd., AIR 2021 SC 6536, held that if an award is not made within six months from entering upon reference or within extended period under proviso to Section 29A(1), then mandate of arbitrator shall terminate unless court has extended period or parties have otherwise agreed before or after expiry of period as specified under proviso to sub-section (4) of Section 29A.
Relevant Provision: Arbitration and Conciliation Act, 1996 – Section 29A
Conclusion
The procedural aspects of arbitration in India are designed to make the process efficient and time-bound. The Arbitration and Conciliation Act, 1996, provides a comprehensive framework that governs these aspects, ensuring that arbitration remains a viable and effective method of dispute resolution.
