LexThe ARBITRATION AND CONCILIATION ACT, 1996
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THE ARBITRATION AND CONCILIATION ACT, 1996
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ARRANGEMENT OF SECTIONS
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PREAMBLE
PRELIMINARY
SECTIONS.
1. Short title, extent and commencement.
PART I
ARBITRATION
CHAPTER I
General provisions
2. Definitions.
3. Receipt of written communications.
4. Waiver of right to object.
5. Extent of judicial intervention.
6. Administrative assistance.
CHAPTER II
Arbitration agreement
7. Arbitration agreement.
8. Power to refer parties to arbitration where there is an arbitration agreement.
9. Interim measures, etc., by Court.
CHAPTER III
Composition of arbitral tribunal
10. Number of arbitrators.
11. Appointment of arbitrators.
11A. Power of Central Government to amend Fourth Schedule.
12. Grounds for challenge.
13. Challenge procedure.
14. Failure or impossibility to act.
15. Termination of mandate and substitution of arbitrator.
CHAPTER IV
Jurisdiction of arbitral tribunals
16. Competence of arbitral tribunal to rule on its jurisdiction.
17. Interim measures ordered by arbitral tribunal.
CHAPTER V
Conduct of arbitral proceedings
18. Equal treatment of parties.
19. Determination of rules of procedure.
20. Place of arbitration.
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SECTIONS.
21. Commencement of arbitral proceedings.
22. Language.
23. Statements of claim and defence.
24. Hearings and written proceedings.
25. Default of a party.
26. [Omitted.].
27. Court assistance in taking evidence.
CHAPTER VI
Making of arbitral award and termination of proceedings
28. Rules applicable to substance of dispute.
29. Decision making by panel of arbitrators.
29A.Time limit for arbitral award.
29B. Fast track procedure.
30. Settlement.
31. Form and contents of arbitral award.
31A. Regime for costs.
32. Termination of proceedings.
33. Correction and interpretation of award; additional award.
CHAPTER VII
Recourse against arbitral award
34. Application for setting aside arbitral awards.
CHAPTER VIII
Finality and enforcement of arbitral awards
35. Finality of arbitral awards.
36. Enforcement.
CHAPTER IX
Appeals
37. Appealable orders.
CHAPTER X
Miscellaneous
38. Deposits.
39. Lien on arbitral award and deposits as to costs.
40. Arbitration agreement not to be discharged by death of party thereto.
41. Provisions in case of insolvency.
42. Jurisdiction.
42A. Confidentiality of information.
42B. Protection of action taken in good faith.
43. Limitations.
PART IA
ARBITRATION COUNCIL OF INDIA
43A. Definitions.
43B. Establishment and incorporation of Arbitration Council of India.
43C. Composition of Council.
43D. Duties and functions of Council.
43E. Vacancies, etc., not to invalidate proceedings of Council.
43F. Resignation of Members.
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SECTIONS.
43G. Removal of Member.
43H. Appointment of experts and constitution of Committees thereof.
43-I. General norms for grading of arbitral institutions.
43J. Norms for accreditation of arbitrators.
43K. Depository of awards.
43L. Power to make regulations by Council.
43M. Chief Executive Officer.
PART II
ENFORCEMENT OF CERTAIN FOREIGN AWARDS
CHAPTER I
New York Convention Awards
44. Definition.
45. Power of judicial authority to refer parties to arbitration.
46. When foreign award binding.
47. Evidence.
48. Conditions for enforcement of foreign awards.
49. Enforcement of foreign awards.
50. Appealable orders.
51. Saving.
52. Chapter II not to apply.
CHAPTER II
Geneva Convention Awards
53. Interpretation.
54. Power of judicial authority to refer parties to arbitration.
55. Foreign awards when binding.
56. Evidence.
57. Conditions for enforcement of foreign awards.
58. Enforcement of foreign awards.
59. Appealable orders.
60. Savings.
PART III
CONCILIATION
61. Application and scope.
62. Commencement of conciliation proceedings.
63. Number of conciliators.
64. Appointment of conciliators.
65. Submission of statements to conciliator.
66. Conciliator not bound by certain enactments.
67. Role of conciliator.
68. Administrative assistance.
69. Communication between conciliator and parties.
70. Disclosure of information.
71. Co-operation of parties with conciliator.
72. Suggestions by parties for settlement of dispute.
73. Settlement agreement.
74. Status and effect of settlement agreement.
75. Confidentiality.
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SECTIONS
76. Termination of conciliation proceedings.
77. Resort to arbitral or judicial proceedings.
78. Costs.
79. Deposits.
80. Role of conciliator in other proceedings.
81. Admissibility of evidence in other proceedings.
PART IV
SUPPLEMENTARY PROVISIONS
82. Power of High Court to make rules.
83. Removal of difficulties.
84. Power to make rules.
85. Repeal and savings.
86. Repeal and saving.
87. Effect of arbitral and related court proceedings commenced prior to 23rd October, 2015.
THE FIRST SCHEDULE.
THE SECOND SCHEDULE.
THE THIRD SCHEDULE.
THE FOURTH SCHEDULE.
THE FIFTH SCHEDULE.
THE SIXTH SCHEDULE.
THE SEVENTH SCHEDULE.
THE EIGHTH SCHEDULE
APPENDIX.
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THE ARBITRATION AND CONCILIATION ACT, 1996
ACT No. 26 OF 1996
[16th August, 1996.]
An Act to consolidate and amend the l aw relating to domestic arbitration, international
commercial arbitration and enforcement of foreign arbitral awards as also to define the law
relating to conciliation and for matters connected therewith or incidental thereto.
Preamble.—WHEREAS the United Nations Commission on International Trade Law (UNCITRAL)
has adopted the UNCITRAL Model Law on International Commercial Arbitration in 1985;
ANDWHEREAS the General Assembly of the United Nations has recommended that all countries give
due consideration to the said Model Law, in view of the desirability of uniformity of the law of arbitral
procedures and the specific needs of international commercial arbitration practice;
ANDWHEREAS the UNCITRAL has adopted the UNCITRAL Conciliation Rules in 1980;
ANDWHEREAS the General Assembly of the United Nations has recommended the use of the said
Rules in cases where a dispute arises in the context of international commercial relations and the parties
seek an amicable settlement of that dispute by recourse to conciliation;
ANDWHEREAS the said Model Law and Rules make significant contribution to the establishment of a
unified legal framework for the fair and efficient settlement of disputes arising in international
commercial relations;
ANDWHEREAS it is expedient to make law respecting arbitration and conciliation, taking into account
the aforesaid Model Law and Rules;
BE it enacted by Parliament in the Forty-seventh Year of the Republic of India as follows:—
PRELIMINARY
1. Short title, extent and commencement. —(1) This Ac t may be called the Arbitration and
Conciliation Act, 1996.
(2) It extends to the whole of India:
1* * * * *
(3) It shall come into force on such date 2 as the Central Government may, by notification in the
Official Gazette, appoint.
PART I
ARBITRATION
CHAPTER I
General provisions
2. Definitions.—(1) In this Part, unless the context otherwise requires,—
(a) “arbitration” means any arbitration whether or not administered by permanent arbitral
institution;
(b) “arbitration agreement” means an agreement referred to in section 7;
1. The proviso and Explanation omitted by the Jammu and Kashmir Reorganization (Adaptation of Central Laws) Order, 2020,
vide notification No. S.O. 1123(E) dated (18 -3-2020) and vide Union Territory of Ladakh Reorganisation (Adaptation of
Central Laws) Order, 2020, notification No. S.O. 3774(E), dated (23-10-2020).
2. 22nd August, 1996, vide notification No. G.S.R 375(E), dated 22nd August, 1996, see Gazette of India, Extraordinary, Part II,
sec. 3(i).
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(c) “arbitral award” includes an interim award;
(d) “arbitral tribunal” means a sole arbitrator or a panel of arbitrators;
1[(e) “Court” means—
(i) in the case of an arbitration other than international commercial arbitration, the principal
Civil Court of original jurisdiction in a district, and includes the High Court in exercise of its
ordinary original civil jurisdiction, having jurisdiction to decide the questions forming the
subject-matter of the arbitration if the same had been the subject -matter of a suit, but does not
include any Civil Court of a grade inferior to such principal Civil Court, or any Court of Small
Causes;
(ii) in the case of international commercial arbitration, the High Court in exercise of its
ordinary original civil jurisdiction, having jurisdiction to decide the questions forming the
subject-matter of the arbitration if the same had been the subject -matter of a suit, and in other
cases, a High Court having jurisdiction to hear appeals from decrees of courts subordinate to that
High Court;]
(f) “international commercial arbitration” means an arbitration relating to disputes arising out of
legal relationships, whether contractual or not, considered as commercial under the law in force in
India and where at least one of the parties is—
(i) an individual who is a national of, or habitually resident in, any country other than India;
or
(ii) a body corporate which is incorporated in any country other than India; or
(iii) 2*** an association or a body of indivi duals whose central management and control is
exercised in any country other than India; or
(iv) the Government of a foreign country;
(g) “legal representative” means a person who in law represents the estate of a deceased person,
and includes any person who intermeddles with the estate of the deceased, and, where a party acts in a
representative character, the person on whom the estate devolves on the death of the party so acting;
(h) “party” means a party to an arbitration agreement.
(2) This Part shall apply where the place of arbitration is in India:
3[Provided that subject to an agreement to the contrary, the provisions of sections 9, 27 and clause (a)
of sub -section ( 1) and sub -section ( 3) of section37 shall also apply to international commercial
arbitration, even if the place of arbitration is outside India, and an arbitral award made or to be made in
such place is enforceable and recognised under the provisions of Part II of this Act.]
(3) This Part shall not affect any other law for the time being in force by virtue of which certain
disputes may not be submitted to arbitration.
(4) This Part except sub -section (1) of section 40, sections 41 and 43 shall apply to every arbitration
under any other enactment for the time being in force, as if the arbitra tion were pursuant to an arbitration
agreement and as if that other enactment were an arbitration agreement, except in so far as the provision s
of this Part are inconsistent with that other enactment or with any rules made thereunder.
(5) Subject to the provisions of sub-section (4), and save in so far as is otherwise provided by any law
for the time being in force or in any agreement in force between India and any other country or countries,
this Part shall apply to all arbitrations and to all proceedings relating thereto.
(6) Where this Part, except section 28, leaves the parties free to determine a certain issue, that
freedom shall include the right of the parties to authorise any person including an institution, to determine
that issue.
1. Subs. by Act 3 of 2016, s. 2, for clause (e) (w.e.f. 23-10-2015).
2. The words “a company or” omitted by s. 2, ibid. (w.e.f. 23-10-2015).
3. Ins. by s. 2, ibid. (w.e. f. 23-10-2015).
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(7) An arbitral award made under this Part shall be considered as a domestic award.
(8) Where this Part—
(a) refers to the fact that the parties have agreed or that they may agree, or
(b) in any other way refers to an agreement of the parties,
that agreement shall include any arbitration rules referred to in that agreement.
(9) Where this Part, other than clause ( a) of section 25 or clause ( a) of sub-section (2) of section 32,
refers to a claim, it shall also apply to a counterclaim, and where it refers to a defence, it sha ll also apply
to a defence to that counterclaim.
3. Receipt of written communications.—(1) Unless otherwise agreed by the parties,—
(a) any written communication is deemed to have been received if it is delivered to the addressee
personally or at his place of business, habitual residence or mailing address, and
(b) if none of the places referred to in clause (a) can be found after making a reasonable inquiry, a
written communication is deemed to have been received if it is sent to the addressee's last known
place of business, habitual residence or mailing address by registered letter or by any other means
which provides a record of the attempt to deliver it.
(2) The communication is deemed to have been received on the day it is so delivered.
(3) This section does not apply to written communications in respect of proceedings of any judicial
authority.
4. Waiver of right to object.—A party who knows that—
(a) any provision of this Part from which the parties may derogate, or
(b) any requirement under the arbitration agreement,
has not been complied with and yet proceeds with the arbitration without stating his objection to such
non-compliance without undue delay or, if a time limit is provided for stating that objection, within that
period of time, shall be deemed to have waived his right to so object.
5. Extent of judicial intervention .—Notwithstanding anything contained in any other law for the
time being in force, in matters governed by this Part, no judicial authority shall intervene except where so
provided in this Part.
6. Administrative assistance .—In order to facilitate the conduct of the arbitral proceedings, the
parties, or the arbitral tribunal with the consent of the parties, may arrange for administrative assistance
by a suitable institution or person.
CHAPTER II
Arbitration agreement
7. Arbitration agreement .—(1) In this Part, “arbitration agreement” means an agreement by the
parties to submit to arbitration all or certain disputes which have arisen or which may arise between them
in respect of a defined legal relationship, whether contractual or not.
(2) An arbitration agreement may be in the form of an arbitration clause in a contract or in the form of
a separate agreement.
(3) An arbitration agreement shall be in writing.
(4) An arbitration agreement is in writing if it is contained in—
(a) a document signed by the parties;
(b) an exchange of letters, telex, telegrams or other means of telecommunication 1[including
communication through electronic means] which provide a record of the agreement; or
1. Ins. by Act 3 of 2016, s. 3 (w. e. f. 23-10-2015).
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(c) an exchange of statements of claim and defence in which the existence of the agreement is
alleged by one party and not denied by the other.
(5) The reference in a contract to a document containing an arbitration clause constitutes an
arbitration agreement if the contract is in writing and the reference is such as to make that arbitration
clause part of the contract.
8. Power to refer parties to arbitration where there is an arbitration agreement.—1[(1)A judicial
authority, before which an action is brough t in a matter which is the subject of an arbitration agreement
shall, if a party to the arbitration agreement or any person claiming through or under him, so applies not
later than the date of submitting his first statement on the substance of the dispute, then, notwithstanding
any judgment, decree or order of the Supreme Court or any Court, refer the parties to arbitration unless it
finds that prima facie no valid arbitration agreement exists.]
(2) The application referred to in sub -section (1) shall not be entertained unless it is accompanied by
the original arbitration agreement or a duly certified copy thereof:
2[Provided that where the original arbitration agreement or a certified copy thereof is not available
with the party applying for reference to ar bitration under sub -section ( 1), and the said agreement or
certified copy is retained by the other party to that agreement, then, the party so applying shall file such
application along with a copy of the arbitration agreement and a petition praying the Co urt to call upon
the other party to produce the original arbitration agreement or its duly certified copy before that Court.]
(3) Notwithstanding that an application has been made under sub -section ( 1) and that the issue is
pending before the judicial authority, an arbitration may be commenced or continued and an arbitral
award made.
STATE AMENDMENT
Jammu and Kashmir and Ladakh (UTs).—
Insertion of section 8A and section 8B.—After section 8, insert the following sections, namely:–
“8A. Power of the court, s eized of petitions under sections 9 or 11 of the Act, to refer the
dispute to Mediation or Conciliation. —(1) If during the pendency of petitions under sections 9 or
11 of the Act, it appears to the court, that there exists elements of a settlement which ma y be
acceptable to the parties, the court may, with the consent of parties, refer the parties, for resolution of
their disputes, to,-
(a) mediation; or
(b) conciliation.
(2) The procedure for reference of a dispute to mediation is as under–
(a) where a d ispute has been referred for resolution by recourse to mediation, the procedure
framed under that Act shall apply;
(b) in case of a successful resolution of the dispute, the Mediator shall immediately forward
the mediated settlement to the referral court;
(c) on receipt of the mediated settlement, the referral court shall independently apply its
judicial mind and record a satisfaction that the mediated settlement is genuine, lawful, voluntary,
entered into without coercion, undue influence, fraud or misrepr esentation and that there is no
other legal impediment in accepting the same;
(d) the court shall record a statement on oath of the parties, or their authorised
representatives, affirming the mediated settlement as well as a clear undertaking of the partie s to
abide by the terms of the settlement;
1. Subs. by Act 3 of 2016, s. 4, for sub-section (1) (w. e. f. 23-10-2015).
2. Ins. by s. 4, ibid. (w.e.f. 23-10-2015).
9
(e) if satisfied, the court shall pass an order in terms of the settlement;
(f) if the main petition, in which the reference was made is pending, it shall be disposed of by
the referral court in terms thereof;
(g) if the main petition, in which the reference was made stands disposed of, the mediated
settlement and the matter shall be listed before the referral court, which shall pass orders in
accordance with clauses (iii), (iv) and (v);
(h) such a mediated settlement, shall have the same status and effect as an arbitral award and
may be enforced in the manner specified under section 36 of the Act.
(3) With respect to reference of a dispute to conciliation, the provisions of Part II of this Act shall
apply as if the conciliation proceedings were initiated by the parties under the relevant provision of
this Act.
8B. Power of the court, seized of matters under sections 34 or 37 of the Act, to refer the
dispute to Mediation or Conciliation .—(1) If during the pendency of a petition under section 34 or
an appeal under section 37 of the Act, it appears to the court, that there exists elements of a settlement
which may be acceptable to the parties, the court may, with the consent of parties, refer the parties,
for resolution of their disputes, to:–
(a) mediation; or
(b) conciliation.
(2) The procedure for reference of a dispute to mediation is as under:-
(a) where a dispute has been referred for resolution by recourse to mediation, the procedure
framed under the Act shall apply;
(b) in case of a successful resolution of the dispute, the Mediator shall immediately forward
the mediated settlement to the referral court;
(c) on receipt of the mediated settlement, the referral court shall independently apply its
judicial mind and record a satisfaction that the mediated settlement is genuine, lawful,
voluntary, entered into without coercion, undue influence, fraud or misrepresentation and that
there is no other legal impediment in accepting the same;
(d) the court shall record a st atement on oath of the parties, or their authorized
representatives, affirming the mediated settlement, a clear undertaking of the parties to abide by
the terms of the settlement as well as statement to the above effect;
(e) if satisfied, the court shall pass an order in terms of the settlement;
(f) if the main petition, in which the reference was made is pending, it shall be disposed of
by the referral court in terms thereof;
(g) if the main petition, in which the reference was made stands disposed of, the mediated
settlement and the matter shall be listed before the referral court, which shall pass orders in
accordance with clauses (iii), (iv) and (v);
(h) such a mediated settlement, shall have the status of a modified arbitral award and may
be enforced in the manner specified under section 36 of the Act.
(3) With respect to reference of a dispute to conciliation, the provisions of Part III of the Act,
shall apply as if the conciliation proceedings were initiated by the parties under the relevant provision
of this Act.”
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[Vide the Jammu and Kashmir Reorganization (Adaptation of Central Laws ) Order, 2020, notification
No. S.O. 1123(E) dated (18 -3-2020) and Vide Union Territory of Ladakh Reorganisation (Adaptation of
Central Laws) Order, 2020, notification No. S.O.3774(E), dated (23-10-2020).]
9. Interim measures, etc., by Court.—1[(1)]A party may, before or during arbitral proceedings or at
any time after the making of the arbitral award but before it is enforced in accordance with section 36,
apply to a court—
(i) for the appointment of a guardian for a minor or person of unsound mind for the purposes of
arbitral proceedings; or
(ii) for an interim measure of protection in respect of any of the following matters, namely:—
(a) the preservation, interim custody or sale of any goods which are the subject -matter of the
arbitration agreement;
(b) securing the amount in dispute in the arbitration;
(c) the detention, preservation or inspection of any property or thing which is the subject -
matter of the dispute in arbi tration, or as to which any question may arise therein and authorising
for any of the aforesaid purposes any person to enter upon any land or building in the possession
of any party, or authorising any samples to be taken or any observation to be made, or experiment
to be tried, which may be necessary or expedient for the purpose of obtaining full information or
evidence;
(d) interim injunction or the appointment of a receiver;
(e) such other interim measure of protection as may appear to the Court to be ju st and
convenient,
and the Court shall have the same power for making orders as it has for the purpose of, and in relation
to, any proceedings before it.
2[(2) Where, before the commencement of the arbitral proceedings, a Court passes an order for any
interim measure of protection under sub-section (1), the arbitral proceedings shall be commenced within a
period of ninety days from the date of such order or within such further time as the Court may determine.
(3) Once the arbitral tribunal has been constitu ted, the Court shall not entertain an application under
sub-section (1), unless the Court finds that circumstances exist which may not render the remedy provided
under section 17 efficacious.]
CHAPTER III
Composition of arbitral tribunal
10. Number of arbi trators.—(1) The parties are free to determine the number of arbitrators,
provided that such number shall not be an even number.
(2) Failing the determination referred to in sub -section (1), the arbitral tribunal shall consist of a sole
arbitrator.
11. Appointment of arbitrators. —(1) A person of any nationality may be an arbitrator, unless
otherwise agreed by the parties.
(2) Subject to sub-section (6), the parties are free to agree on a procedure for appointing the arbitrator
or arbitrators.
(3) Failing any agreement referred to in sub -section (2), in an arbitration with three arbitrators, each
party shall appoint one arbitrator, and the two appointed arbitrators shall appoint the third arbitrator who
shall act as the presiding arbitrator.
(4) If the appointment procedure in sub-section (3) applies and—
(a) a party fails to appoint an arbitrator within thirty days from the receipt of a request to do so
from the other party; or
1. Section 9 shall be renumbered as sub-section (1) thereof by s. 5, Act 3 of 2016 (w.e.f. 23-10-2015).
2. Ins. by s. 5, ibid. (w.e.f. 23-10-2015).
11
(b) the two appointed arbitrators fail to agree on the third arbitrator within thi rty days from the
date of their appointment,
the appointment shall be made, upon request of a party, by 1[the Supreme Court or, as the case may be,
the High Court or any person or institution designated by such Court];
(5) Failing any agreement referred to in sub-section (2), in an arbitration with a sole arbitrator, if the
parties fail to agree on the arbitrator within thirty days from receipt of a request by one party from the
other party to so agree the appointment shall be made, upon request of a party, by 1[the Supreme Court or,
as the case may be, the High Court or any person or institution designated by such Court].
(6) Where, under an appointment procedure agreed upon by the parties,—
(a) a party fails to act as required under that procedure; or
(b) the parties, or the two appointed arbitrators, fail to reach an agreement expected of them under
that procedure; or
(c) a person, including an institution, fails to perform any function entrusted to him or it under
that procedure,
a party may request 1[the Supreme Court or, as the case may be, the High Court or any person or
institution designated by such Court] to take the necessary measure, unless the agreement on the
appointment procedure provides other means for securing the appointment.
2[(6A) The Supreme Court or, as the case may be, the High Court, while considering any application
under sub-section (4) or sub-section (5) or sub-section (6), shall, notwithstanding any judgment, decree or
order of any Court, confine to the examination of the existence of an arbitration agreement.
(6B) The designation of any person or institution by the Supreme Court or, as the case may be, the
High Court, for the purposes of this section shall not be regarded as a delegation of judicial power by the
Supreme Court or the High Court.]
(7) A decision on a matter entrusted by sub -section (4) or sub -section (5) or sub -section (6) to 3[the
Supreme Court or, as the case may be, the High Court or the person or institution designated by such
Court is final and no appeal including Letters Patent Appeal shall lie against such decision].
4[(8) The Supreme Court or, as the case may be, the High Court or the person or institution designated
by such Court, before appointing an arbitrator, shall seek a disclosure in writing from the prosp ective
arbitrator in terms of sub-section (1) of section 12, and have due regard to—
(a) any qualifications required for the arbitrator by the agreement of the parties; and
(b) the contents of the disclosure and other considerations as are likely to secure the appointment
of an independent and impartial arbitrator.]
(9) In the case of appointment of sole or third arbitrator in an international commercial arbitration,
5[the Supreme Court or the person or institution designated by that Court] may appoint an a rbitrator of a
nationality other than the nationalities of the parties where the parties belong to different nationalities.
6[(10) The Supreme Court or, as the case may be, the High Court, may make such scheme as the said
Court may deem appropriate for dea ling with matters entrusted by sub -section (4) or sub -section (5) or
sub-section (6), to it.]
(11) Where more than one request has been made under sub -section ( 4) or sub -section ( 5) or
sub-section (6) to the Chief Justices of different High Courts or their designates, 7[different High Courts
1. Subs. by Act 3 of 2016, s. 6, for “the Chief Justice or any person or institution designated by him” (w. e. f. 23-10-2015).
2. Ins. by s. 6, ibid. (w.e.f. 23-10-2015).
3. Subs. by s. 6, ibid., for “the Chief Justice or the person or institution designated by him is final” (w.e.f. 23-10-2015).
4. Subs. by s. 6, ibid., for sub-section (8) (w.e.f. 23-10-2015).
5. Subs. by s. 6, ibid., for “the Chief Justice of India of India or the person or institution designated by him” (w.e.f. 23-10-2015).
6. Subs. by s. 6, ibid., for sub-section (10) (w.e.f. 23-10-2015).
7. Subs. by s. 6, ibid., for “the Ch ief Justices of different High C ourts or their designates, the Chief Justice or his designate to
whom the request has been first made” (w.e.f 23-10-2015).
12
or their designates, the High Court or its designate to whom the request has been first made] under the
relevant sub-section shall alone be competent to decide on the request.
1[(12) (a) Where the matters referred to in sub-sections (4), (5), (6), (7), (8) and sub-section (10) arise
in an international commercial arbitration, the reference to the “Supreme Court or, as the case may be, the
High Court” in those sub-sections shall be construed as a reference to the “Supreme Court”; and
(b) Where the matters referred to in sub-sections (4), (5), (6), (7), (8) and sub-section (10) arise in any
other arbitration, the reference to “the Supreme Court or, as the case may be, the High Court” in those
sub-sections shall be construed as a reference to the “High Court” within whose local limits the principal
Civil Court referred to in clause ( e) of sub -section (1) of section 2 is situate, and where the High Court
itself is the Court referred to in that clause, to that High Court.]
2[(13) An application made under this section for appointment of an arbitrator or arbitrators shall be
disposed of by the Supreme Court or the High Court or the person or institution designated by such Court,
as the case maybe, as expeditiou sly as possible and an endeavour shall be made to dispose of the matter
within a period of sixty days from the date of service of notice on the opposite party.
(14) For the purpose of determination of the fees of the arbitral tribunal and the manner of it s
payment to the arbitral tribunal, the High Court may frame such rules as may be necessary, after taking
into consideration the rates specified in the Fourth Schedule.
Explanation.—For the removal of doubts, it is hereby clarified that this sub -section shall not apply to
international commercial arbitration and in arbitrations (other than international commercial arbitration)
in case where parties have agreed for determination of fees as per the rules of an arbitral institution.]
3[11A. Power of Central Government to amend Fourth Schedule.—(1) If the Central Government
is satisfied that it is necessary or expedient so to do, it may, by notification in the Official Gazette, amend
the Fourth Schedule and thereupon the Fourth Schedule shall be deemed to have b een amended
accordingly.
(2) A copy of every notification proposed to be issued under sub -section ( 1), shall be laid in draft
before each House of Parliament, while it is in session, for a total period of thirty days which may be
comprised in one session o r in two or more successive sessions, and if, before the expiry of the session
immediately following the session or the successive sessions aforesaid, both Houses agree in
disapproving the issue of the notification or both Houses agree in making any modifi cation in the
notification, the notification shall not be issued or, as the case may be, shall be issued only in such
modified form as may be agreed upon by the both Houses of Parliament.]
12. Grounds for challenge .—4[(1) When a person is approached in con nection with his possible
appointment as an arbitrator, he shall disclose in writing any circumstances,—
(a) such as the existence either direct or indirect, of any past or present relationship with or
interest in any of the parties or in relation to the subject-matter in dispute, whether financial, business,
professional or other kind, which is likely to give rise to justifiable doubts as to his independence or
impartiality; and
(b) which are likely to affect his ability to devote sufficient time to the ar bitration and in
particular his ability to complete the entire arbitration within a period of twelve months.
Explanation1.—The grounds stated in the Fifth Schedule shall guide in determining whether
circumstances exist which give rise to justifiable doubts as to the independence or impartiality of an
arbitrator.
Explanation 2.—The disclosure shall be made by such person in the form specified in the Sixth
Schedule.]
(2) An arbitrator, from the time of his appointment and throughout the arbitral proceedings, shall,
without delay, disclose to the parties in writing any circumst ances referred to in sub -section (1) unless
they have already been informed of them by him.
1. Subs. by Act 3 of 2016, s. 6, for sub-section (12) (w.e.f. 23-10-2015).
2. Ins. by s. 6, ibid.(w.e.f. 23-10-2015).
3. Ins. by s. 7, ibid. (w.e.f. 23-10-2015).
4. Subs. by s. 8, ibid., for sub-section (1) (w.e.f. 23-10-2015).
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(3) An arbitrator may be challenged only if—
(a) circumstances exist that give rise to justi fiable doubts as to his independence or impartiality,
or
(b) he does not possess the qualifications agreed to by the parties.
(4) A party may challenge an arbitrator appointed by him, or in whose appointment he has
participated, only for reasons of which he becomes aware after the appointment has been made.
1[(5) Notwithstanding any prior agreement to the contrary, any person whose relationship, with the
parties or counsel or the subject -matter of the dispute, falls under any of the categories specified in the
Seventh Schedule shall be ineligible to be appointed as an arbitrator:
Provided that parties may, subsequent to disputes having arisen between them, waive the applicability
of this sub-section by an express agreement in writing.]
13. Challenge procedure.—(1) Subject to sub-section (4), the parties are free to agree on a procedure
for challenging an arbitrator.
(2) Failing any agreement referred to in sub-section (1), a party who intends to challenge an arbitrator
shall, within fifteen days after becoming aware of the constitution of the arbitral tribunal or after
becoming aware of any circumstances referred to in sub -section (3) of section 12, send a written
statement of the reasons for the challenge to the arbitral tribunal.
(3) Unless the arbitrator challenged under sub-section (2) withdraws from his office or the other party
agrees to the challenge, the arbitral tribunal shall decide on the challenge.
(4) If a challenge under any procedure agreed upon by the parties or under the procedure under sub -
section ( 2) is not successful, the arbitral tribunal shall continue the arbitral proceedings and make an
arbitral award.
(5) Where an arbitral award is made under sub -section (4), the party challenging the arbitrator may
make an application for setting aside such an arbitral award in accordance with section 34.
(6) Where an arbitral award is set aside on an application made under sub -section (5), the Court may
decide as to whether the arbitrator who is challenged is entitled to any fees.
14. Failure or imposs ibility to act .—(1) 2[The mandate of an arbitrator shall terminate and he shall
be substituted by another arbitrator, if]—
(a) he becomes de jure or de facto unable to perform his functions or for other reasons fails to act
without undue delay; and
(b) he withdraws from his office or the parties agree to the termination of his mandate.
(2) If a controversy remains concerning any of the grounds referred to in clause (a) of sub-section (1),
a party may, unless otherwise agreed by the parties, apply to the Court to decide on the termination of the
mandate.
(3) If, under this section or sub -section (3) of section 13, an arbitrator withdraws from his office or a
party agrees to the termination of the mandate of an arbitrator, it shall not imply acceptance of the validity
of any ground referred to in this section or sub-section (3) of section 12.
15. Termination of mandate and substitution of arbitrator .—(1) In addition to the circumstances
referred to in section 13 or section 14,the mandate of an arbitrator shall terminate—
(a) where he withdraws from office for any reason; or
(b) by or pursuant to agreement of the parties.
1. Ins. by Act 3 of 2016, s. 8 (w.e.f. 23-10-2015).
2. Subs. by s. 9, ibid., for “The mandate of an arbitrator shall terminate if” (w.e.f. 23-10-2015).
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(2) Where the mandate of an arbitrator terminates, a substitute arbitrator shall be appointed according
to the rules that were applicable to the appointment of the arbitrator being replaced.
(3) Unless otherwise agreed by the parties, where an arbitrator is replaced under sub -section (2), any
hearings previously held maybe repeated at the discretion of the arbitral tribunal.
(4) Unless otherwise agreed by the parties, an order or ruling of the arbitral tribunal made prior to the
replacement of an arbitrator under this section shall not be invalid solely because there has been a change
in the composition of the arbitral tribunal.
CHAPTER IV
Jurisdiction of arbitral tribunals
16. Competence of arbitral tribunal to rule on its jurisdiction. —(1) The arbitral tribunal may rule
on its own jurisdiction, including ruling on any objections with respect to the existence or validity of the
arbitration agreement, and for that purpose,—
(a) an arbitration clause which forms part of a contract shall be treated as an agreement
independent of the other terms of the contract; and
(b) a decision by the arbitral tribunal that the contract is null and void shall not entail ipso jure the
invalidity of the arbitration clause.
(2) A plea that the arbitral tribunal does not have jurisdiction shall be raised not later than the
submission of the statement of defence; however, a party shall not be precluded from raising such a plea
merely because that he has appointed, or participated in the appointment of, an arbitrator.
(3) A plea that the arbitral tribunal is exceeding the scope of its authority shall be raised as soon as the
matter alleged to be beyond the scope of its authority is raised during the arbitral proceedings.
(4) The arbitral tribunal may, in either of the cases referred to in sub -section (2) or sub -section (3),
admit a later plea if it considers the delay justified.
(5) The arbitral tribunal shall decide on a pl ea referred to in sub -section (2) or sub -section (3) and,
where the arbitral tribunal takes a decision rejecting the plea, continue with the arbitral proceedings and
make an arbitral award.
(6) A party aggrieved by such an arbitral award may make an applic ation for setting aside such an
arbitral award in accordance with section 34.
1[17. Interim measures ordered by arbitral tribunal .—(1) A party may, during the arbitral
proceedings 2***, apply to the arbitral tribunal—
(i) for the appointment of a guardian for a minor or person of unsound mind for the purposes of
arbitral proceedings; or
(ii) for an interim measure of protection in respect of any of the following matters, namely:—
(a) the preservation, interim custody or sale of any goods which are the subject-matter of the
arbitration agreement;
(b) securing the amount in dispute in the arbitration;
(c) the detention, preservation or inspection of any property or thing which is the subject -
matter of the dispute in arbitration, or as to which any question may arise therein and authorising
for any of the aforesaid purposes any person to enter upon any land or building in the possession
of any party, or authorising any samples to be taken, or any observation to be made, or
experiment to be tried, which may be ne cessary or expedient for the purpose of obtaining full
information or evidence;
(d) interim injunction or the appointment of a receiver;
1. Subs. by Act 3 of 2016, s. 10, for section 17 (w.e.f. 23-10-2015).
2. The words and fi gures “or at any time after the making of the arbitral award but before it is enforced in accordance with
section 36” omitted by Act 33 of 2019, s. 4 (w.e.f. 30-8-2019).
15
(e) such other interim measure of protection as may appear to the arbitral tribunal to be just
and convenient,
and the arbitral tribunal shall have the same power for making orders, as the court has for the purpose of,
and in relation to, any proceedings before it.
(2) Subject to any orders passed in an appeal under section 37, any order issued by the arbitral
tribunal und er this section shall be deemed to be an order of the Court for all purposes and shall be
enforceable under the Code of Civil Procedure,1908 (5 of 1908), in the same manner as if it were an order
of the Court.]
CHAPTER V
Conduct of arbitral proceedings
18. Equal treatment of parties .—The parties shall be treated with equality and each party shall be
given a full opportunity to present this case.
19. Determination of rules of procedure. —(1) The arbitral tribunal shall not be bound by the Code
of Civil Procedure, 1908 (5 of 1908) or the Indian Evidence Act, 1872 (1 of 1872).
(2) Subject to this Part, the parties are free to agree on the procedure to be followed by the arbitral
tribunal in conducting its proceedings.
(3) Failing any agreement referred to in sub -section (2), the arbitral tribunal may, subject to this Part,
conduct the proceedings in the manner it considers appropriate.
(4) The power of the arbitral tribunal under sub -section ( 3) includes the power to determine the
admissibility, relevance, materiality and weight of any evidence.
20. Place of arbitration.—(1) The parties are free to agree on the place of arbitration.
(2) Failing any agreement referred to in sub -section (1), the place of arbitration shall be determined
by the arbitral tribunal havin g regard to the circumstances of the case, including the convenience of the
parties.
(3) Notwithstanding sub -section ( 1) or sub -section ( 2), the arbitral tribunal may, unless otherwise
agreed by the parties, meet at anyplace it considers appropriate for co nsultation among its members, for
hearing witnesses, experts or the parties, or for inspection of documents, goods or other property.
21. Commencement of arbitral proceedings. —Unless otherwise agreed by the pa rties, the arbitral
proceedings in respect of a particular dispute commence on the date on which a request for that dispute to
be referred to arbitration is received by the respondent.
22. Language.—(1) The parties are free to agree upon the language or languages to be used in the
arbitral proceedings.
(2) Failing any agreement referred to in sub -section ( 1), the arbitral tribunal shall determine the
language or languages to be used in the arbitral proceedings.
(3) The agreement or determination, unless otherwise specified, shall apply to any written st atement
by a party, any hearing and any arbitral award, decision or other communication by the arbitral tribunal.
(4) The arbitral tribunal may order that any documentary evidence shall be accompanied by a
translation into the language or languages agreed upon by the parties or determined by the arbitral
tribunal.
23. Statements of claim and defence. —(1) Within the period of time agreed upon by the parties or
determined by the arbitral tribunal, the claimant shall state the facts supporting his claim, the p oints at
issue and the relief or remedy sought, and the respondent shall state his defence in respect of these
particulars, unless the parties have otherwise agreed as to the required elements of those statements.
(2) The parties may submit with their stat ements all documents they consider to be relevant or may
add a reference to the documents orExcerpt shown. Open the full act in Lexace.