First published on LiveLaw
After many rounds of deliberations and at least two Law Commission Reports separated by more than a decade (Report 176 in 2001and Report 246 in 2014), the Arbitration and Conciliation Act, 1996 was finally amended on 23 October 2015 by way of an ordinance. The ordinance route was justified on grounds that the amendments were urgent to send the right message about Indian government’s intentions of making the necessary legal reforms for ease of doing business in India.
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ABSTRACT: The Indian law ministry released a consultation paper in April 2010 inviting comments on proposed amendments to the Indian Arbitration Act. While based on the Model Law, the interpretation of the Indian Act in 15 years since enactment has created serious divergence from transnational standards. A unique absurdity is the delimited application of the Act to even arbitrations seated outside India. Merits review has crept in through innovative means. Public policy defence is read as the repository of all residual powers. The proposals identify the problems, but do they walk the talk? This article analyses the contours of these problems in detail and puts the proposals to test. The conclusion in most cases is that the proposal covers a fraction of the whole issue it attempts to deal with. This article contains suggestions that could help complete the task and align Indian arbitral regime to transnational standards on these issues.
Paper is available here
First published on IndiaCorpLaw Blog
In Arti Jethani v. Daeshan Trading (India) Pvt. Ltd. (decision dated 16.05.2011), the Delhi High Court held that a Section 8 application under the Arbitration & Conciliation Act, 1996 (Arbitration Act) was not maintainable if brought after the filing of written statement, even if the written statement raised jurisdictional objections on grounds of existence of an arbitration agreement. While there is authority to support this conclusion, it suggests a formalistic bias in the court’s approach to interpretation. An extremely formalistic approach to interpretation of the Arbitration Act, defeating an arbitration agreement, is the very anti-thesis of the policy that led to the new law in 1996. This decision also fails to take into account the negative effect of an arbitration agreement.
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