Abstract

In order to give effect to the UNICITRAL Model Law on Arbitration and due to radical change in its economy as the result of the 1991 New Economic Policy (NEP) India enacted the 1996 Arbitration & Conciliation Act. This Act provides a pragmatic legal basis for resolution of commercial disputes outside the court procedures. It circumscribes the older laws and consolidates multiple legal norms dealing with arbitration. However, the experiences in application of this Act for the last 20 years suggest that it needs to be amended as it contains serious drawbacks primarily due to poor legal technique which necessitated excessive judicial interventions and judicial overreach having led to resentment among those willing to resort to alternative dispute resolution under this Act while keeping the seat of Arbitration in India. Several attempts were made by the successive governments aiming at amending the 1996 Act. Yet all those attempts failed. Finally the present Union Government under the leadership of the Prime Minister Mr. Narendra Modi was able to bring in sweeping changes in existing arbitration law. These changes were carried out with the commitment of the Government in doing business in India through the Ordinance route and proper legislative procedures which finally led to the amendments having come into force on January 1, 2016. This paper attempts to analyse the key changes brought through the 2015 Amendment Act and their impact on the application of arbitration law in India. Moreover, the authors overview the prospects of India to acquire the preferred position in International Commercial Arbitration in the future as envisioned by the present Modi Government.

Highlights

  • Applying Provisions of Part I for a Foreign Seated ArbitrationAfter the case of Bharat Aluminium Co. v

  • In order to give effect to the UNICITRAL Model Law on Arbitration and due to radical change in its economy as the result of the 1991 New Economic Policy (NEP) India enacted the 1996 Arbitration & Conciliation Act

  • The Ordinance Act and the Amendment Act mark a change in legal thinking and legal practice

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Summary

Applying Provisions of Part I for a Foreign Seated Arbitration

After the case of Bharat Aluminium Co. v. Kaiser Aluminium Technical Services Inc. (BALCO Judgement) which puts a complete bar on Indian courts to exercise jurisdiction over foreign seated arbitrations According to this judgment, on the basis of Sec. 2(2) of the 1996 Act, all the provisions under the Part I of the Act would apply when the arbitration is seated in India, and Indian courts cannot invoke any provisions under Part I of the Act with respect of foreign seated arbitration. A provision was included in Sec. 2(2) which grants to Indian courts jurisdiction in the context of seeking interim injunction in a foreign seated Arbitration, as well as assistance in collecting evidence in a foreign seated arbitration or making appeal for court orders.3 This provision applies only if the parties express an agreement to use it. Such legal ambiguity runs the risk of undermining the kompetenz-kompetenz rule under Sec. 16 by taking away the power of the arbitral tribunal

Interim Injunction
Appointment of Arbitrators
Time Limit for Arbitral Award
Fast Track Arbitration
Imposition of Costs
Limiting the Scope of Setting Arbitral Award Aside
Issues Requiring Further Determination
Findings
Conclusion
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