1. Invalid Arbitration Agreement: Arbitration cannot take place if the arbitration agreement is found to be invalid due to a lack of mutual consent, fraud, misrepresentation, or failure to meet the legal criteria under the governing law.
2. Incapacity of Parties: If one of the parties lacks the legal capacity to enter into an arbitration agreement (for example, minors or mentally ill adults), the arbitration cannot be enforced.
3. Disputes Exceeding Jurisdiction: If the dispute is beyond the scope of what was agreed to be arbitrated, such as subjects not covered by the arbitration agreement, arbitration may be invalid. This includes matters that are fundamentally non-arbitrable under the relevant legislation.
4. Claims for Equitable Relief: Certain claims for equitable remedy (such as injunctions) may not be subject to arbitration. Courts may retain jurisdiction over certain claims to grant quick relief.
5. Third-Party Claims: If the dispute involves third parties, not parties to the arbitration agreement, those claims cannot be arbitrated unless they agree to participate in the arbitration process.
6. Provisional Remedies: Requests for provisional remedies (such as temporary restraining orders) may need to be heard in court rather than through arbitration, particularly where immediate relief is required to avoid irreparable injury.
7. Legal and Physical Impediments: Arbitration is rendered infeasible in situations where legal frameworks explicitly prohibit arbitration for certain types of disputes (e.g., family law matters in some jurisdictions) or where physical conditions prevent arbitration from taking place (e.g., lack of arbitrators or facility availability).
8. Time-barred Claims: If the claims sought to be arbitrated are undoubtedly time-barred under relevant limitation statutes, courts may refuse to appoint arbitrators or permit arbitration to proceed.

A person of any nationality may be appointed arbitrator unless the contrary intention is expressed by the parties.

An arbitral tribunal is a panel of one or more arbitrators assembled to resolve a dispute through arbitration.

The parties are free to agree on a procedure for the appointment of arbitrator or arbitrators. Where parties fail to appoint three arbitrators, each party shall appoint one arbitrator and the two arbitrators shall appoint the third arbitrator. Hence, appointing three arbitrators is mandatory, with the third one being the presiding arbitrator.

Yes. Where a party fails to appoint an arbitrator in accordance with the third arbitrator within thirty days from the date of receipt of a request to do so from the other party or two appointed arbitrators fail to agree on the third arbitrator within 30 days from the date of their appointment, the appointment shall be made, upon a request of a party, by the Chief Justice of the High Court or any person or institution designated by him.

In the absence of any procedure to appoint a sole arbitrator, if the parties fail to agree on the arbitrator within 30 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 the Chief Justice of the High Court or any person or institution designated by him.

Section 11 only confers power on the High Court to appoint an arbitrator or presiding arbitrator only when the following conditions are fulfilled:

1. where there is a valid arbitration agreement;
2. the agreement contains for the appointment of one or more arbitrators;
3. the appointment of the arbitrator is to be made by mutual consent of all the parties to the dispute.
4. differences have arisen between the parties to the arbitration agreement; or between the appointed arbitrators;
5. the differences are on the appointment or appointments of arbitrators.

A party can apply to a court for interim measures before the commencement of the arbitration or during the arbitration proceedings. Interim relief can also be sought after the arbitration award has been made but before it is enforced in accordance with Section 36 of the Arbitration and Conciliation Act, 1996.

The court can grant interim measures for:

1. Preservation, interim custody, or sale of goods that are the subject matter of the arbitration agreement.
2. Securing the amount in dispute in the arbitration.
3. Detention, preservation, or inspection of any property or thing which is the subject matter of the dispute in arbitration.
4. Interim injunction or appointment of a receiver.
5. Such other interim measures of protection as may appear to the court to be just and convenient.

Before the Court (Section 9): The party seeking interim relief must file an application before the competent court, which is usually the principal civil court of original jurisdiction (District Court) or the High Court if it has original jurisdiction over the subject matter of the arbitration.

Before the Arbitral Tribunal (Section 17): The party seeking interim relief must file an application before the arbitral tribunal detailing the necessity of such measures.

The ‘venue of arbitration’ refers to the appropriate or convenient geographic location where the tribunal conducts its hearings. In contrast, the ‘seat of arbitration’ serves as the legal domicile of the arbitration and generally determines the procedural law applicable to the arbitration proceedings.

An arbitration award is the award granted by the arbitrator in their decision. This award can be money one party has to pay to the other party. It can also be a non-financial award, such as stopping a certain business practice or adding an employment incentive.

Section 29A of the Arbitration and Conciliation Act, 1996

The award in matters other than international commercial arbitration shall be made by the arbitral tribunal within a period of twelve months from the date of completion of pleadings.

A domestic award may be set aside by the court under Section 34(2) of the Arbitration Act if the arbitral records can establish that:

1. the party was under some incapacity;
2. the arbitration agreement is not valid under the law chosen by the parties or, in its absence not valid under the law in force at the relevant time;
3. the applicant was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings, or was otherwise unable to present his or her case;
4. the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matter beyond the scope of the submission to arbitration; or
5. the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties, or failing any such agreement, was not in accordance with Part I of the Arbitration Act.

An arbitral award may also be set aside if the court finds that:

1. The subject matter of the dispute is not capable of settlement by arbitration under the law for the time being in force or
2. The arbitral award is in conflict with the public policy of India.

Yes, Section 37 of the Arbitration and Conciliation Act, 1996 – Appealable orders

1.  an appeal shall lie from the following orders (and from no others) to the Court authorised by law to hear appeals from original decrees of the Court passing the order, namely:-

•  (a) refusing to refer the parties to arbitration under section 8;
• (b) granting or refusing to grant any measure under section 9;
• (c) setting aside or refusing to set aside an arbitral award under section 34.

 2.Appeal shall also lie to a court from an order of the arbitral tribunal—

• (a) accepting the plea referred to in sub-section (2) or sub-section (3) of section 16; or
• (b) granting or refusing to grant an interim measure under section 17.

 3.No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall affect or takeaway any right to appeal to the Supreme Court.

Disputes involving joint ventures, construction projects, partnership differences, intellectual property rights, personal injury, product liabilities, professional liability, real estate securities, contract interpretation and performance, insurance claim and Banking & non-Banking transaction disputes fall within the jurisdiction of Arbitration.

Section 22 of the Arbitration and Conciliation Act, 1996

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 statement 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.

Some of the key merits of arbitration are that it is less costly, faster than litigation, private in nature, can be more flexible for the parties, is less formal in nature, and is a very effective way to solve disputes.

1. Notice of Request to Arbitrate: This document must be delivered to each party involved in the dispute and typically includes the names and contact details (address, email, phone) of all parties.
2. Arbitration Agreement or Clause: A copy of the arbitration clause or agreement that outlines the parties’ consent to arbitrate must be included.
3. Supporting Documents: Any relevant contracts or documents related to the dispute should be appended. This may include prior correspondence or agreements that provide context for the arbitration.

Yes.

Grounds for Challenging an Arbitrator

1. Impartiality and Independence: An arbitrator may be challenged if there are justifiable doubts regarding their impartiality or independence. This includes any relationships or circumstances that could influence their judgment.
2. Qualifications: If the arbitrator does not possess the qualifications agreed upon by the parties or specified in the arbitration agreement, this can be a valid ground for challenge.
3. Disclosure Failures: An arbitrator is required to disclose any potential conflicts of interest or relationships that might affect their impartiality. Failure to provide such disclosures can lead to a challenge.

On 22nd July 2024, the Bombay High Court bench at Aurangabad held that an arbitration agreement survives termination of the parent contract, invoking Section 16(1) of the Arbitration and Conciliation Act, 1996. It held that arbitration clause is independent of the main contract.

On 13th December 2023 a seven judge bench of the Supreme Court in In Re: Interplay between Arbitration Agreements under the Arbitration And Conciliation Act, 1996 and the Indian Stamp Act, 1899, unanimously ruled on the issue surrounding the admissibility of unstamped or insufficiently stamped instrument in evidence, which arose in the context of three statues – the Arbitration and Conciliation Act 1996 (“Arbitration Act”), the Indian Stamp Act 1899 (“Stamp Act”), and the Indian Contract Act 1872 (“Contract Act”). The Court held that an instrument which is unstamped or insufficiently stamped would be inadmissible in evidence, however the same is a curable defect and that in itself does not make the agreement void or unenforceable.

Parties can mutually agree to extend the time frame by 6 months.

When the death of any party takes place, the arbitration proceeding shall not be discharged. The decision will be enforced by or against the legal representatives of the deceased party.

The arbitral award that is given under this Act can be of two types the first one is the “Final Award” which is given when the arbitral proceeding comes to an end and the second award is the “Interim Award” which is given during the arbitral proceeding. Furthermore, the award can either be a domestic award or a foreign award.