ID NO: ADADR138_21

Name : Rupender  Swarna ( S. Rupender )

( DDE:  ADADR138_21)  admission batch: 2021 to 2022.
SUBJECT: – 1.3.  Law of Arbitration and Conciliation in India
Paper -3
No of pages:  12

Section 1:
Answer1)
Conflicts are inevitable in any societal set-up. Earlier, the only way available to
people was to hustle through litigation but with the advent of alternative dispute
resolution methods, Arbitration gained prominence in India. It is a form of dispute
resolution in which the parties choose their own adjudicator and mode and place of
resolving their disputes whereby the arbitrator through the application of the laws
of the land and after hearing both the parties speedily settle the dispute by passing
an award in favour of the deserving party. The arbitrator hears both the parties and
then relying upon the oral submissions and documents provided, issue a resolution.

ADVANTAGES OF ARBITRATION
There are numerous advantages of going for arbitration over litigation. The major
ones among them are as follows:

Cost effective
In arbitration, not much legal preparation is required. Most of the charges or costs
incurred during the arbitration process are divided between both the parties. This
makes this process much cheaper than the traditional litigation. 
Simple and informal procedure
In arbitration, the parties do not have to hire advocates to represent them. The
parties can themselves present their issues and demands before the arbitrator. No
formal mannerisms are used in this process which results in a comfortable
environment.
Fairness
In traditional legal trial, neither part can choose the judge who will decide their
case. However, in arbitration, both the parties have the liberty to choose arbitrator.
This results in a fair outcome.    

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Efficient and flexible
The traditional litigation takes too much time to resolve. It may also take years to
solve a particular case. A legal resolution through arbitration is much quicker than
litigation. Arbitration is more flexible in terms of scheduling. Arbitration hearings
can conveniently be scheduled based on the availability of parties and the arbitrator

Convenience
In litigation, the date of hearing is to be determined by the Court. For this, the
convenience of the parties is not kept in mind. Sometimes, the parties have to wait
for long time to get court dates. However, in arbitration, parties have the right to
agree upon a particular date as suitable for them and their witnesses.

Confidentiality
In Court, all the proceedings are open to public. However, in arbitration, any
disclosure made by the parties in the proceedings is to be kept confidential.
Therefore, the arbitration legal process is more private than litigation.
Finality 
The decision made by the arbitrator is final one. There is not any system of appeal
in the arbitration process.

Agreeableness
In arbitration, neither party wins nor losses. Both the parties came to an agreeable
outcome which is in compliance with their needs.

Full control of the process 

Both the parties have all the rights to determine by agreement the conduct of the
proceedings. On the basis of it, the procedure is streamlined to suit the specific
requirements of the case at hand. 

DISADVANTAGES OF ARBITRATION
Every coin has two sides. Along with numerous advantages, there are a number of
disadvantages of arbitration that the parties should keep in mind if they want to go
for arbitration. The major ones among them are as follows:

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No Appeals 
The decision given by the arbitrator is considered as final. There is no system of
appeal in arbitration process. Even if one party feels that the outcome of arbitration
process was unfair, unjust, or biased, they do not have the option to appeal it.
Cost
Arbitration is generally considered as a cost-effective process as compared to
litigation. However, this feature does not hold any significance in those cases in
which minimal money is involved.

Rules of Evidence
In a Court of law, a judge has to follow specific rules and regulations while
accepting evidence. However, it is not so in arbitration. Arbitrators can utilise any
information that is brought to them.

Limited powers of arbitrator

The Court possesses the power to punish the litigants who are obstructive or
dilatory in their conduct of the proceedings. However, an arbitrator’s powers are
not as strong as to find someone in contempt of court.

Questionable Fairness in Mandatory arbitration

If the contract itself states that arbitration is mandatory in case any dispute arises
then the parties do not have the flexibility to choose arbitration upon mutual
consent.

Lack of transparency
The arbitration hearings are generally not made open to public and are held in
private. This can be a positive as well as a negative feature of arbitration. This lack
of transparency may turn the process biased and ultimately result into injustice.
Inconsistently following the law
Although it is right that the arbitrator has to follow the law but the standards are
not clear. It is highly possible that the arbitrator may consider the “apparent
fairness” of the respective parties’ positions instead of strictly following the law.
This becomes more significant when our party would be favored by a strict
application of the law. 
CONCLUSION             
Arbitration is an attractive method of alternative dispute resolution that can provide
an attractive alternative to the traditional legal system. Arbitration has its own
advantages and disadvantages. All these pros and cons along with the particular

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transaction and the needs of the parties should be taken into consideration before
agreeing to arbitrate a dispute.

Section 2:
ANSWER1): Arbitration in India has been growing recently. But, there has been
constant debates and discussions about the powers and involvement of the courts in
the process of Arbitration. Arbitration has proved to be a necessary tool in dispute
resolution and so, there is a constant need to evolve and grow with the changing
times.

Court
A court is any person or institution, often as a government institution, with the
authority to adjudicate legal disputes between parties and carry out the
administration of justice in civil, criminal, and administrative matters in
accordance with the rule of law.

Arbitration is typically used to resolve disputes between private entities, outside

the court machinery. In simple terms, arbitration is a process when two or more
parties decide to settle a dispute outside the court. Arbitration in India is defined by
the Arbitration and Conciliation Act,1996 which contains four parts. Part I deals
with general provisions on domestic arbitration. Part II involves the enforcement
and execution of foreign awards. Part I and Part II are most substantial and are
based on UNCITRAL Model Law and the New York Convention respectively. A
simplified arbitration agreement involves following steps: 

 First of all, the parties to a contract/agreement, adds arbitration clause

into their agreement/contract and if and when any dispute arises between
them, one party informs the other party about the dispute by issuing
arbitration notice. 
 This is followed by response by the other party and subsequent
appointment of an arbitrator, decision on rules and procedures, place of
arbitration and language.
 Once the arbitration proceedings commence, there are formal hearings
and written proceedings. 
 The arbitrator can issue interim relief and also final award which will be
applicable on both the parties. 

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 If either of the party is unhappy or not convinced with the award, they can
challenge the award before the court. Challenging the award can be
before appellate court or Supreme Court, whichever is competent.

 Judicial Intervention
Section 5 of the of the Arbitration and Conciliation Act,1996 provides for
the extent of judicial intervention which says that “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”.The word “Part” referred to in this Section is
Part I of the Act,1996 which shall apply where the place of arbitration is
in India and shall not affect any other law for the time being in force by
virtue of which certain disputes may not be submitted to arbitration.

Interim Measures by the Court 

Section 9 of Arbitration and Conciliation Act,1996 states that a party may
before or during the arbitral proceedings or at any time after making of
the arbitral award but before it is enforced in accordance with Section 36,
may apply to the court for interim measure of protection. Prayers for
interim measures of protection may include:  

1. The preservation, interim custody or sale of any goods, which

are the subject matter of the arbitration agreement. 
2.  Securing the amount in dispute in the arbitration.
3. 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 necessary or expedient for the purpose
of obtaining full information or evidence. 
4.  Interim injunction or the appointment of a receiver.
5. Such other interim measures of protection may appear to the
Court to be just and convenient. And the court shall have the

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 same power for making orders as it has for the purpose of and in
relation to, any proceedings before it. 

Appointment of Arbitrator
The Parties can mutually determine the procedure for appointment of the
arbitrator prior to the commencement of the arbitration proceedings.
Nonetheless, if for some reason, the parties failed to appoint an arbitrator
for conducting arbitration proceedings then the court has the power to
appoint the arbitrator in such cases. 

Termination of Mandate of an Arbitrator 

According to Sec. 14, an arbitrator’s mandate will be terminated if:

6. the arbitrator becomes de jure or de facto unable to perform their

functions or fails to act without delay for another reason and
withdraws from their office; or
7. the parties to the arbitration agree to terminate the arbitrator’s
mandate.
Moreover, sec. 15 states some additional circumstances which will
terminate the mandate of an arbitrator, that are:

8. If he withdraws from office from any reason;

9. By or in accordance to the agreement of the parties.
Furthermore, section 15 deals with substitution of arbitrator and states:

10.After the termination of mandate of an arbitrator, a substitute

arbitrator should be appointed according to the rules previously
put to use.
11.Any hearing that took place under the previous arbitrator can be
repeated at the discretion of the arbitral tribunal, except
otherwise stated by the parties.
12.Moreover, an order or ruling made prior to the termination of an
arbitrator, will not be invalid solely because the structure of the
arbitral tribunal has changed.

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Setting aside the Arbitral Award 
Setting aside the arbitral award in simple terms is called challenging the
arbitral award. Sec. 34 of the Arbitration and conciliation Act, 1996 lays
down the grounds for setting aside the arbitral award, which are as
follow:

13.The party was under some form of incapacity;

14.The arbitration agreement is not valid under the law in force, for
which the agreement has been subjected to;
15.The party was not given proper notice of appointment of
arbitrator or the arbitral proceedings;
16.The award falls beyond the scope of submission to arbitration;
17.The due procedure was not followed, while appointment of
arbitrator or the tribunal;
18.The award is in violation of public policy of India;
19.The subject matter of dispute is not capable of being settled by
the arbitration.
If an arbitral award falls within the limits of above mentioned grounds,
the party can file a petition u/s 34 to challenge such award, before the
competent court.

Enforcement of the Award 

Section 36 of Arbitration and Conciliation Act, 1996 deals with the
enforcement of the award. It states that:

Once an award is made, the concerned party has to wait 90 days, before
he can file for execution of such award, before the competent
court/forum.

After the 2015 amendment, sec. 34 application does not put an automatic
stay on the enforcement of execution of award. Rather, the party wanting
to set aside the award under sec. 34 shall file a separate application before
the court, asking for stay on execution proceedings.

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 Sec. 35 of the act states that an award is final and binding. Hence, it
becomes enforceable unless it is challenged under sec. 34 application.
Moreover, if only a part of an award is challenged under sec. 34
application, then the unchallenged part becomes enforceable under sec.
36 of the act.

Appealable Orders 
Section 37 of Arbitration and Conciliation Act,1996 deals with provision
relating to appealable orders. Section 37 deals with processes involved in
PART I and Domestic arbitration. Appealable orders relevant to
procedures of PART II and foreign arbitration are dealt in Section 50 of
the Act.

Provisions under section 37(1) which deals with appealable order of the
Court, are briefly mentioned hereon:

20.Refusing the parties to refer them to arbitration under section 8.

21.Granting or refusing to grant any measures under section 9.
22.Setting aside or refusing to set aside an arbitral award under
section 34.

 Section 3)
 Answer1) As the indian pharmaceutical company has entered the contract
when there was no ban neither any restriction of public policy of its own
land , here we can observe a fair deal with a common intension of
business or trade . In later stages none know what's going to happen or
what would happen , so it was unexpected ,un anticipated and undesired
even if we think in the form of introspection ,hence no organisation ,no
individual or any company shall not go against public policy though even
it has got commitments to fulfill along other side , here nation first comes
into priority ,as company cannot decide on the public policy or it cannot
work against it ,its the helplessness of the indian party to perform with the
contract .
 while taking the decree passed by the london court shall not be executed
by the bombay court because no court can accept to implement foreign

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 decree, A foreign decree or a foreign judgment is defined under Section
2(6) of the CPC as a judgment given by a Foreign Court. Section 2(5) of
CPC defines a Foreign Court as a court that is located outside India and
has not been established or being continued by the authority of the
Central Government. Explanation II of Section 44A defines “decree” with
reference to Superior Court as any decision or judgment of such Court
requiring payment of a sum of money, other than a sum payable in respect
of taxes or other charges of a similar nature, or fine or other penalties, but
not an arbitration award, even if such an award is enforceable as a decree
or judgment.
 the Under Section 44A of the CPC, foreign decrees can only be executed
in India if they are passed by any “Superior Court” of any “reciprocating
territory”. The Central Government notifies from time to time as to what
are the Reciprocating territories and the respective Superior Courts.
‘Reciprocating territory’ refers to any country or territory outside India
that the Central Government may declare a reciprocating territory for the
purposes of Section 44-A by notification. When referring to any such
territory, a “higher court” refers to the courts listed in the notification.

 Though the civil procedure code 1908 of India supports in favour of

foreign decree or awards ,when it is against public policy of the
country ,hence it  cannot implement as execute petition.

Section 4)
Answer 1) Conciliation is an alternative out-of-court dispute resolution instrument.
Like mediation, conciliation is a voluntary, flexible, confidential, and interest
based process. The parties seek to reach an amicable dispute settlement with the
assistance of the conciliator, who acts as a neutral third party.
Typical examples of the types of issue dealt with in the conciliation process
include claims for improvements in pay or conditions of employment, disciplinary
cases, grading issues, disputes arising from proposed changes to the way work is
done, company restructuring etc.
Once the parties in dispute have agreed to a conciliation process, an independent
conciliator will be appointed. They will discuss the issues and try to help the
parties reach an agreement, often providing their own opinion after assessing the
situation and the different arguments. Their opinion may help to form a settlement
or achieve a conclusion to the dispute.
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It's important to note that the conciliation process is entirely voluntary; a successful
outcome depends on a mutual agreement and either party is free to walk away at
any stage.

Appointment of concilators 

Conciliator can be appointed by the parties themselves of their own choice with
consensus i.e. both should agree upon the appointment of the conciliator. IDRC has
a Panel of Conciliators with rich experience in varied fields.
The parties follow any of the following methods.
(a) The parties themselves may name a conciliator or conciliators from IDRC
Panel. 
(b) Each party may appoint one conciliator from IDRC Panel & may mutually
agree on the third conciliator. 
(c) The parties may enlist the assistance of a suitable institution ie IDRC  in
connection with the appointment of conciliators.
In the case of family court, or labour court etc, before referring the matter to the
court it is compulsory to consult with the councilor i.e. conciliator, who are
appointed by the government for making settlement between the parties before the
trial & on the report of the councilor only, matter is put forth for trial.
Here, Conciliator should not be of a specific qualification, but he should also not
be ignorant of the subject matter. He can be a expert person of the subject matter of
dispute for e.g. if there is a dispute regarding construction cost of a building in that
case a person can be a civil engineer, who has the knowledge of building
construction. The important thing, which cannot be ignored, is that conciliation is
not the person who will decide the matter; rather he is a person who assists the
parties to arrive at amicable settlement, where the decision is of the parties
themselves.

Removal of Concilators:

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A conciliator may also be removed for incapacity of failure to perform the duties
required of an conciliator.If the parties reach an agreement on all or some issues
and wish to discontinue the conciliation, they will notify the Commission. The
parties may provide the Commission with the complete and signed text of their
agreement and jointly request the Commission to embody the same in its
Report.Section 12(3) of the Arbitration and Conciliation (Amendment) Act, 2015
states the circumstances in which an arbitrator may be challenged. These include
circumstances that give rise to justifiable doubts as to his independence or
impartiality or he does not possess the qualifications agreed to by the parties.
However, a party who has appointed an arbitrator or participated in the
appointment of an arbitrator is allowed to challenge such an arbitrator only for
reasons of which he becomes aware after the appointment has been made.

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