SPOM SET C- PAPER 6

THE ARBITRATION
AND
CONCILIATION ACT, 1996

 SUMMARY NOTES
 COVERAGE OF ALL TOPICS FROM EACH
CHAPTERS
 MCQ ORIENTED

BRYAN PRISTON PINTO

+91 9008514206
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THE ARBITRATION AND CONCILIATION ACT, 1996

CHAPTER 1: INTRODUCTION

1. Defini on and Scope of Alternate Dispute Resolu on (ADR):

 ADR encompasses methods used to resolve disputes outside the ordinary
court system, offering an "alterna ve to li ga on."
 Common methods include Arbitra on, Concilia on, Media on, Nego a on,
Lok Adalats, case evalua on, neutral fact-finding, and ombudsperson.
 The source highlights that "[a]lternate methods of dispute resolu on (ADR)
are used to resolve disputes outside the ordinary court system. In other
words, these methods are an alterna ve to li ga on."
1. Arbitra on:
 Defined as a method involving one or more neutral third persons selected by
the dispu ng par es whose decision is binding.
 Key features include: flexibility in procedure, choice of decision-makers,
privacy and confiden ality, a final and binding decision with normally no
appeal, and being compara vely less formal than trial.
 The source states, "It could be understood as a method of dispute resolu on
involving one or more neutral third person/s selected by the dispu ng par es
and whose decision is binding."
1. Concilia on:
 Described as a less formal form of arbitra on focused on facilita ng
se lement between par es.
 A conciliator meets with both par es separately to improve communica on
and interpreta on to help them reach a se lement.

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 Features include: no prior agreement essen al, less formal than arbitra on,
par es not bound by recommenda ons but become binding if accepted by
all.
 The document notes, "The process of concilia on is to facilitate the
se lement between the par es."
1. Media on:
 Presented as an increasingly popular ADR mechanism that facilitates conflict
resolu on through an impar al third party (mediator).
 Key principles emphasized:
 Voluntary and Self-Determined: "Media on is a voluntary process, and all
concerned par es must par cipate willingly. Each party retains control over
the outcome..."
 Impar ality and Neutrality: Crucial for effec veness; the mediator should
not take sides. The example of Z being the brother of one party illustrates a
conflict of interest. "Impar ality and neutrality of mediator is central to the
effec veness of media on. The mediator serves as a neutral facilitator,
refraining from taking sides or imposing decisions."
 Confiden ality: Discussions are private and cannot be used as evidence in
court. "Confiden ality is the founda on of the media on process.
Discussions and arguments done during media on are private and cannot be
used as evidence in court."
 Explicit Consent: All par es must provide informed consent before star ng.
 Stages of Media on: Introduc on and opening statements, joint discussion,
private discussion, nego a on and problem-solving, agreement, and closure.
 Role of Mediator: Facilita on, employing communica on skills (ac ve
listening, paraphrasing, reframing), maintaining impar ality and neutrality,
ac ng as a conflict resolu on expert, and fostering crea ve solu ons.
1. Nego a on:

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 Described as a dynamic process where par es seek mutual agreement to

se le a dispute, being the most common ADR method.
 It's a non-binding procedure without third-party interven on, aimed at a
nego ated se lement.
 Principles of Nego a on: Voluntary process, honest communica on, mutual
agreement, and flexibility.
 Nego a on Process: Prepara on, opening statements, bargaining and
concession, and closure and agreement.
 Role of Nego ators: Effec ve communica on, fostering crea ve solu ons,
and possessing high emo onal intelligence.
 Importance of Nego a on in ADR: Time and cost-effec ve, preserva on of
rela onships, and tailored solu ons.
1. Lok Adalats:
 Meaning "People's Courts," a dis nc ve feature of the Indian legal system
established under the Legal Services Authori es Act, 1987.
 Focus on ADR through media on and concilia on, opera ng on a voluntary
basis or court recommenda on.
 Priori ze easy se lements and ac ve par cipa on from dispu ng par es,
with jurisdic on over various types of disputes.
 Contribute to reducing the backlog of cases in formal courts and embody
principles of accessibility and expedi ous jus ce.
1. Advantages of Alternate Dispute Resolu on (ADR):
 More viable, economical, and efficient.
 Procedural flexibility saves me and money, avoiding the burden of a
conven onal trial.
 Maintains confiden ality due to private resolu on.
 Possibility of having specialized exper se in the tribunal.

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 Results in crea ve solu ons, sustainable outcomes, greater sa sfac on, and
improved rela onships.
 Personal rela onships may suffer less.
 The source explicitly lists: "It is more viable, economical, and efficient... The
procedural flexibility saves valuable me and money and there is no burden
of a conven onal trial... As the resolu on of disputes takes place usually in
private, they help maintain confiden ality... The possibility of ensuring that
specialized exper se is available on the tribunal... This results in the form of
crea ve solu ons, sustainable outcomes, greater sa sfac on, and improved
rela onships... Personal rela onships may also suffer less."
1. Comparisons Between Different ADR Methods:
 The source provides detailed comparisons between Arbitra on and
Concilia on, Arbitra on and Media on, Media on and Concilia on,
Arbitra on and Nego a on, and Media on and Nego a on based on factors
like third-party involvement, decision-making authority, binding nature of
the decision, formality of the process, confiden ality, and adversarial vs.
collabora ve nature.
 For example, regarding the role of the neutral third party, it's stated:
"Involves a neutral third party, called an arbitrator or a panel of arbitrators,
who acts as a judge and makes a binding decision... (Arbitra on)" versus
"Involves a neutral third party, known as a mediator, who facilitates
communica on between the par es but does not have the authority to
impose a decision. (Media on)"
Conclusion:
The provided source offers a founda onal understanding of various Alternate
Dispute Resolu on mechanisms. It highlights their dis nct characteris cs,
processes, and the crucial roles of the involved neutral third par es. The emphasis
on the advantages of ADR underscores its significance as a prac cal and beneficial
alterna ve to tradi onal li ga on, capable of delivering efficient, cost-effec ve,
and mutually sa sfactory resolu ons while o en preserving important

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rela onships between dispu ng par es. The inclusion of Lok Adalats showcases a
unique aspect of the Indian legal system geared towards accessible and swi
jus ce. This introduc on sets the stage for a more detailed explora on of each ADR
method in subsequent chapters, as indicated by the notes within the text.

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CHAPTER 2: FUNDAMENTALS OF ARBITRATION

1. Introduc on to Arbitra on and the 1996 Act:

 The chapter aims to provide an understanding of the general provisions of
arbitra on, the arbitra on agreement, conduct of proceedings, arbitral
awards, recourse against awards, and their enforcement.
 The Arbitra on and Concilia on Act, 1996, is divided into four parts with 88
sec ons and seven schedules. Part I deals with Arbitra on, Part II with the
Enforcement of Certain Foreign Awards, Part III with Concilia on, and Part
IV with Supplementary Provisions.
 A landmark judgment by the High Court of Madras in "A.K. Balaji v.
Government of India & others" (2012) established that foreign lawyers
cannot be barred from coming to India to conduct arbitra on proceedings
related to interna onal commercial arbitra on.
2. Basic Features and Process of Arbitra on:
 Flexibility in Procedure: Arbitra on allows par es to agree on the rules and
procedures to be followed.
 Choice of Decision Makers: Par es can select their own arbitrators.
 Privacy and Confiden ality: Arbitra on proceedings are generally private
and confiden al.
 Final and Binding Decision: The arbitral award is a legally binding decision
on the par es.
 The process involves the appointment of an Arbitral Tribunal (neutral third
party) which conducts adjudica on and issues a binding Arbitral Award.
3. The Arbitra on Agreement (Consent is Fundamental):

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 Arbitra on requires the consent of all par es, which is documented in an

Arbitra on Agreement.
 This agreement signifies the par es' inten on to resolve disputes through
arbitra on instead of going to court.
 The agreement is a binding contract.
 It can take the form of an arbitra on clause within a larger contract
(covering poten al future disputes) or a submission agreement entered
into a er a dispute has arisen.
 Key requirements for a valid arbitra on agreement: Wri ng: It must be in
wri ng (can include invoices with arbitra on clauses or email
correspondence).
 Clarity of Consent (Consensus ad idem): The inten on to arbitrate must be
clear and unambiguous. Vague language is insufficient. The words used
should indicate a "determina on and obliga on" to arbitrate, not just a
possibility.
 Enforceability: It must meet all the requirements of a valid contract under
Indian law.
 Ouster of Jurisdic on: Once agreed, neither party can unilaterally go to
court for ma ers covered by the agreement. They will be referred back to
arbitra on.
 Doctrine of Separability: The arbitra on agreement is treated as separate
from the main contract, so the invalidity of the main contract does not
automa cally invalidate the arbitra on agreement.
 Competency to Rule on Jurisdic on (Sec on 16): The arbitral tribunal can
rule on its own jurisdic on, including the validity of the main contract.
 Arbitrability: The subject ma er of the dispute must be legally permissible
for arbitra on (e.g., criminal offences, matrimonial disputes, etc., are
generally not arbitrable).

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 An arbitra on agreement can be terminated in ways similar to how

contracts are terminated, including nova on of the original contract.
However, mere se lement discussions during arbitra on do not
automa cally revoke the agreement.
4. Par es, Arbitrator, and Arbitral Tribunal:
 Par es: Defined as those who are party to an arbitra on agreement.
 Arbitrator (Arbitral Tribunal): Acts like a judge, deciding disputes neutrally
and impar ally. If arbitrators are not independent, they can be removed by
the court.
 Par es are free to determine the number of arbitrators (must be an odd
number unless agreed otherwise; if no agreement, it defaults to a sole
arbitrator).
 Par es are free to agree on the procedure for appoin ng arbitrators. If no
consensus, the court (Supreme Court for interna onal commercial
arbitra on, High Court for domes c) can appoint. The Supreme and High
Courts can also designate persons or ins tu ons for this purpose.
 Appointment of an arbitrator by a party is only complete upon
communica on to the other party.
 Arbitrators cannot consult third par es without disclosing it to the par es;
doing so can be considered misconduct.
5. Conduct of Arbitral Proceedings:
 Commencement of Proceedings (Sec on 21): Unless otherwise agreed,
proceedings commence when a request for the dispute to be referred to
arbitra on is received by the respondent. Simply making a claim does not
automa cally commence proceedings.
 Equal Treatment of Par es (Sec on 18): Par es must be treated equally
and given a full opportunity to present their case. This includes receiving all
informa on disclosed to the other party, being present during

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examina ons, and not deciding based on secret inquiries without express
authoriza on.
 Procedure Determined by Par es/Tribunal (Sec on 19): Par es are free to
agree on the procedure. Failing agreement, the arbitral tribunal can
conduct proceedings as it deems appropriate, subject to Part I of the Act.
The tribunal has the power to determine the admissibility, relevance,
materiality, and weight of evidence.
 The Arbitral Tribunal is not bound by the Code of Civil Procedure, 1908, or
the Indian Evidence Act, 1872, but must adhere to the principles of natural
jus ce (fair hearing, reasonable opportunity).
 Place of Arbitra on (Sec on 20): Par es are free to agree on the venue. If
they fail to agree, the arbitral tribunal will determine the place having
regard to the circumstances and convenience of the par es. Merely having
the venue in a different place does not nullify a binding clause giving
exclusivity to a court.
 Statement of Claim and Defence (Sec on 23): The claimant submits a
statement of claims with facts and relevant documents. The respondent can
submit a counter-claim or set-off if it falls within the scope of the arbitra on
agreement. These must be completed within six months from the
arbitrator's appointment no ce. Amendments to claims or defenses are
allowed unless the tribunal deems it inappropriate due to delay. Par es
must state essen al material facts to avoid surprising the other party.
 Default of a Party (Sec on 25): If the claimant fails to submit their
statement of claim without sufficient cause, the tribunal can terminate
proceedings. If the respondent fails to submit their defence, the tribunal
can con nue without trea ng it as an admission and can forfeit their right
to file a defence. However, the claimant may s ll pe on the tribunal to
recall a termina on by showing sufficient cause.
 Appointment of Experts (Sec on 26): The tribunal can appoint one or more
experts to report on specific issues and can require par es to provide
informa on and access to evidence. Experts may be called for oral hearings

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where par es can ques on them and present their own experts. The
tribunal cannot delegate the en re determina on of the dispute to an
expert.
 Court Assistance in Taking Evidence (Sec on 27): The arbitral tribunal or a
party (with the tribunal's approval) can seek court assistance in taking
evidence. The court can issue summonses to witnesses, and those who fail
to comply or show contempt to the tribunal can be subject to penal es by
court order. The court can only facilitate the recording of evidence, not
direct its produc on or recording.
 Period of Limita on (Sec on 43): The Limita on Act, 1963, applies to
arbitra on proceedings. The commencement date of proceedings is crucial
for calcula ng me limits. Time-barred claims cannot be referred to
arbitra on.
6. Making of Arbitral Award and Termina on of Proceedings:
 Rules Applicable to Substance of Dispute (Sec on 28):In domes c
arbitra on, the tribunal applies the substan ve law in force in India.
 In interna onal commercial arbitra on, the tribunal applies the rules of law
designated by the par es. If no designa on, the tribunal applies rules it
considers appropriate.
 Unless authorized by the par es, the tribunal should not decide based on
"ex aequo et bono" (equitable principles without strict law) or as "amiable
compositeur."
 The tribunal must always consider the terms of the contract and applicable
trade usages.
 Decision-making by Panel of Arbitrators (Sec on 29): Unless agreed
otherwise, decisions are made by a majority of members. Procedural
ques ons can be decided by the presiding arbitrator if authorized. There is
no umpire system in the Act, although courts have some mes jus fied
appoin ng an arbitrator as an "umpire" in specific scenarios.

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 Time Limit for Arbitral Award (Sec on 29A): For ma ers other than
interna onal commercial arbitra on, the award should be made within 12
months from the comple on of pleadings. For interna onal commercial
arbitra on, an endeavor should be made to dispose of the ma er within 12
months. This meline can be extended by mutual consent of the par es for
up to six months, or by the court for sufficient cause.
 Fast-Track Procedure (Sec on 29B): Par es can agree to a fast-track
procedure where the tribunal typically decides based on wri en pleadings
and documents without oral hearings, unless specifically requested by all
par es or deemed necessary by the tribunal. A shorter me limit of six
months applies to fast-track awards.
 Se lement (Sec on 30): The tribunal can encourage se lement and, with
party agreement, use media on, concilia on, or other procedures. If a
se lement is reached and the tribunal has no objec on (unless against
public policy, unfair, or fraudulent), it can be recorded as an arbitral award
(Se lement Award). Such a se lement does not revoke the arbitra on
agreement.
 Form and Contents of Arbitral Award (Sec on 31):Must be in wri ng and
signed by the arbitrators (majority suffices if reason for omi ed signature is
stated).
 Must state the reasons upon which it is based, unless par es agree
otherwise or it's a se lement award.
 Must state the date and place of arbitra on (deemed to be made at that
place).
 A signed copy must be delivered to each party.
 The tribunal can make interim arbitral awards.
 Unless agreed otherwise, the tribunal can include interest in monetary
awards for the period between the cause of ac on and the award, and the
awarded sum typically carries a higher interest rate from the date of the
award to the date of payment.

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 Costs of arbitra on are to be fixed by the arbitral tribunal in accordance

with Sec on 31A. Arbitrators cannot award interest if there is a specific bar
against it in the contract for the pre-reference or pendente lite period,
unless otherwise agreed.
 Regime for Costs (Sec on 31A): The court or arbitral tribunal has discre on
to determine if costs are payable, the amount, and when they are to be
paid. "Costs" include reasonable expenses related to legal fees, arbitrator
fees, witness expenses, and administra ve costs. The general rule is that
the unsuccessful party pays costs, but the court or tribunal can make
different orders based on factors like party conduct, par al success,
frivolous counter-claims, and refusal of reasonable se lement offers.
 Correc on and Interpreta on of Award; Addi onal Award (Sec on 33):
Within 30 days of receiving the award, a party can request the tribunal to
correct errors or, if agreed, to provide an interpreta on. The tribunal has 30
days to respond. The tribunal can also correct errors on its own ini a ve
within 30 days. Unless agreed otherwise, a party can request an addi onal
award for claims presented but omi ed within 30 days of the award. The
tribunal has 60 days to make the addi onal award if jus fied. The me
limits can be extended if necessary. Sec on 31 applies to correc ons,
interpreta ons, and addi onal awards.
 Termina on of Proceedings (Sec on 32): Proceedings are terminated by
the final arbitral award or by a tribunal order (e.g., if the claimant defaults,
par es agree to terminate, or the tribunal finds con nua on unnecessary
or impossible). The mandate of the tribunal also terminates with the
conclusion of proceedings, subject to powers under Sec on 33.
7. Recourse Against Arbitral Award (Sec on 34):
 An arbitral award can only be set aside by a court if a party makes an
applica on within three months from the date of receiving the award
(extendable by a maximum of 30 more days by the court).
 Grounds for se ng aside an award are specified in Sec on 34 (not detailed
in this excerpt).

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 Only a party to the arbitra on agreement can challenge an award.

 The authority to challenge an award is a court (District Court or High Court
exercising original jurisdic on for domes c awards; High Court for
interna onal commercial arbitra on awards).
8. Finality and Enforcement of Arbitral Awards:
 Finality of Arbitral Awards (Sec on 35): Subject to Part I (recourse under
Sec on 34), an arbitral award is final and binding on the par es and those
claiming under them once the period for challenging it under Sec on 34 has
expired or the challenge has been dismissed. A final and binding award can
only be ques oned on the ground of lack of jurisdic on.
 Enforcement (Sec on 36): Once the me for challenging the award has
expired or a challenge has been dismissed, the award is enforceable as a
decree of the court under the Code of Civil Procedure, 1908.
 The party seeking enforcement can file the award before the court with
jurisdic on over the subject ma er or the losing party's assets.
 The court can grant a stay on enforcement if an applica on to set aside the
award under Sec on 34 is filed. When considering a stay for a monetary
award, the court will consider the provisions for staying a money decree
under the CPC. A mandatory uncondi onal stay is granted if the court finds
a prima facie case that the arbitra on agreement or the making of the
award was induced by fraud or corrup on.
 An arbitral award is enforceable as a decree regardless of the country
where it was made.
Clarifica ons Regarding Specific Sec ons:
 Sec on 2(2): Part I of the Act applies to arbitra ons taking place in India. It
generally does not apply to interna onal commercial arbitra ons held
outside India, except for Sec ons 9 (interim measures), 27 (court assistance
in taking evidence), and certain provisions of Sec on 37 (appeals), which
can apply even if the place of arbitra on is outside India if the award is

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sought to be enforced in India. There should be no overlapping or

intermingling of Part I and Part II provisions.
 Sec on 2(1)(e) ("Court"): For interna onal commercial arbitra on, "Court"
means the High Court exercising original civil jurisdic on. For other
arbitra ons, it includes the Principal Civil Court of original jurisdic on
(District Court) and the High Court exercising original civil jurisdic on. The
defini on clarifies which courts have jurisdic on for different types of
arbitra on and enforcement. Indian courts can have jurisdic on even if an
interna onal commercial arbitra on takes place outside India.
 Sec on 2(1)(f) ("Interna onal Commercial Arbitra on"): This defini on
does not dis nguish between interna onal commercial arbitra ons held in
India or outside India. It focuses on the nature of the dispute (commercial
under Indian law) and the na onality/residence/incorpora on/control of at
least one of the par es being outside India.
 Sec on 5 (Extent of Judicial Interven on): Emphasizes that in ma ers
governed by Part I, no judicial authority shall intervene except where
specifically provided in Part I. This reflects a pro-arbitra on stance and
respects the autonomy of the par es.
 Sec on 7 ("Arbitra on Agreement"): Defines an arbitra on agreement as
an agreement by par es to submit to arbitra on all or certain disputes
(exis ng or future) regarding a defined legal rela onship (contractual or
not).
Key Takeaways:
 The Arbitra on and Concilia on Act, 1996, provides a comprehensive
framework for arbitra on in India, emphasizing party autonomy and
minimizing judicial interven on.
 A valid and clearly worded arbitra on agreement is the cornerstone of any
arbitra on.
 Arbitrators and arbitral tribunals must be neutral, impar al, and conduct
proceedings fairly, adhering to principles of natural jus ce.

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 The Act sets out procedures for the conduct of proceedings, the making of
awards, and their enforcement, including melines for certain stages.
 Recourse against an arbitral award is limited and can only be sought within
a specific meframe and on specified grounds.
 Enforcement of arbitral awards is generally swi and treated as the
enforcement of a court decree.

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CHAPTER 3- ENFORCEMENT OF CERTAIN FOREIGN AWARDS

1. Types of Arbitra on and Their Features:

The chapter begins by providing an overview of different types of arbitra on based
on various criteria:
 Ad hoc Arbitra on: Par es manage the process themselves without an
ins tu on. Key features include:
 Greater flexibility and autonomy in shaping procedural rules and selec ng
arbitrators.
 Poten ally cost-effec ve due to the absence of ins tu onal administra ve
fees.
 Requires par es to handle administra ve tasks.
 Enforceability is governed by na onal and interna onal laws like the New
York Conven on.
 Par es can select arbitrators with specific exper se.
 O en offers a high level of confiden ality.
 Quote: "Ad-hoc arbitra on refers to a type of arbitra on where the par es
involved in a dispute manage the arbitra on process themselves, without the
assistance of an established arbitra on ins tu on or organiza on."
 Ins tu onal Arbitra on: Conducted under the auspices and rules of an
established arbitra on ins tu on. Key features include:
 Administra on by a specialized ins tu on providing procedural guidance and
support.
 Standardized procedural rules ensuring a consistent framework.
 Ins tu ons may provide a roster of qualified arbitrators.

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 Designed to be neutral and impar al.

 Higher costs due to ins tu onal fees.
 O en includes provisions for confiden ality.
 Quote: "Ins tu onal Arbitra on is a dispute process where there is a prior
agreement between the par es that in case of future differences or disputes
arising between the par es during their commercial transac ons, such
differences or disputes will be se led by arbitra on and will be referred to
an established arbitra on ins tu on or organiza on."
 Domes c Arbitra on: Arbitra on that occurs within India, where both
par es are Indian, and the conflict is decided by Indian substan ve law.
 Governed by Indian arbitra on laws.
 Significant flexibility in procedure.
 Requires a valid arbitra on agreement.
 Domes c awards are generally enforceable like court judgments within India.
 Interna onal Arbitra on: Involves at least one party domiciled or resident
outside India, or the subject ma er of the dispute is related to a place outside
India.
 Involves par es from different countries or cross-border transac ons.
 Provides a neutral and impar al forum.
 Par es can choose the governing law for the substance of the dispute.
 Can be ad hoc or ins tu onal.
 Awards have limited grounds for challenge and are poten ally cost-effec ve.
 Quote: "Where at least one of the par es involved is domiciled or resident
outside India or the subject ma er of the dispute is related to place outside,
such arbitra on is treated as Interna onal Arbitra on."

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 Contractual Arbitra on: Arises from an arbitra on clause included in a

commercial agreement, indica ng the par es' consent to resolve future
disputes through arbitra on.
 Par es have freedom to tailor the arbitra on clause.
 Aims for speedy resolu on and procedural flexibility.
 Statutory Arbitra on: Mandatory arbitra on imposed by law, where par es
have no choice but to abide by the legal provisions for dispute resolu on in
specific areas.
 Based on specific legisla on outlining procedures and rules.
 Consent of par es is not required.
 Fast Track Arbitra on: A me-bound procedure under Sec on 29B of the
Arbitra on and Concilia on (Amendment) Act, 2015, aiming to resolve
disputes (typically trade-related) within six months.
 Emphasizes limited hearings and expedited processes.
 Foreign Arbitra on: Arbitra on proceedings conducted in a place outside
India. Awards from such arbitra ons are considered "foreign awards."
 Quote: "When the arbitra on proceedings are conducted in a place outside
India, it is called “foreign arbitra on”. In such type of arbitra on, a “foreign
award” is sought."
2. Types of Arbitral Awards:
The chapter also categorizes arbitral awards:
 Ad hoc Arbitral Awards: Awards issued in ad hoc arbitra ons.
 Domes c Arbitral Awards: Awards issued in arbitra on proceedings where
the dispute is resolved within a single country and governed by its laws.
 Interna onal Commercial Awards: Awards issued in arbitra on involving
par es from different countries, o en related to interna onal business
transac ons. Key features include:

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 Governing law is o en interna onal or agreed upon by the par es.

 Require a valid arbitra on agreement.
 Arbitrators with diverse backgrounds and exper se are o en sought.
 Recogni on and enforcement are facilitated by interna onal conven ons like
the New York Conven on.
 Aim for cost and me effec veness while o en maintaining confiden ality.
3. Enforcement of Foreign Awards:
This is the central theme of the chapter, focusing on the incorpora on of the
Foreign Awards (Recogni on and Enforcement) Act, 1961 (related to the New York
Conven on) and the Arbitra on (Protocol and Conven on) Act, of 1937 (related to
the Geneva Conven on) into Part II of the Arbitra on and Concilia on Act, 1996.
 New York Conven on Awards (Chapter I of Part II):
 Defini on of "Foreign Award" (Sec on 44): An arbitral award on commercial
legal rela onships made on or a er October 11, 1960, in pursuance of a
wri en arbitra on agreement in a territory no fied by the Central
Government as a signatory to the New York Conven on.
 Quote: ""foreign award" means an arbitral award on differences between
persons arising out of legal rela onships, whether contractual or not,
considered as commercial under the law in force in India, made on or a er
the 11th day of October, 1960— (a) in pursuance of an agreement in wri ng
for arbitra on to which the Conven on set forth in the First Schedule applies,
and (b) in one of such territories as the Central Government... declare to be
territories to which the said Conven on applies."
 Power of Judicial Authority to Refer Par es to Arbitra on (Sec on 45): A
judicial authority seized of a ma er covered by a New York Conven on
arbitra on agreement shall, at the request of a party, refer the par es to
arbitra on unless the agreement is prima facie null and void, inopera ve, or
incapable of being performed.

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 Quote: "a judicial authority, when seized of an ac on in a ma er in respect

of which the par es have made an agreement referred to in sec on 44, shall,
at the request of one of the par es... refer the par es to arbitra on, unless
it prima facie finds that the said agreement is null and void, inopera ve or
incapable of being performed."
 When Foreign Award is Binding (Sec on 46): A foreign award enforceable
under this chapter is treated as binding and can be relied upon in legal
proceedings in India.
 Evidence Required for Enforcement (Sec on 47): The party seeking
enforcement must produce the original award or a duly authen cated copy,
the original arbitra on agreement or a cer fied copy, and evidence proving
the award is a foreign award. Transla ons into English may be required.
 Condi ons for Refusal of Enforcement (Sec on 48): Enforcement may be
refused if the party against whom the award is invoked proves:
 Incapacity of par es or invalidity of the arbitra on agreement.
 Lack of proper no ce of arbitrator appointment or proceedings, or inability
to present their case (viola on of natural jus ce).
 Award deals with ma ers beyond the scope of submission to arbitra on.
 Composi on of the arbitral authority or procedure was not in accordance
with the agreement or the law of the country where arbitra on took place.
 The award is not yet binding, has been set aside, or suspended by a
competent authority in the country of origin.
 Addi onally, enforcement can be refused if the subject ma er is not
arbitrable under Indian law or if it would be contrary to the public policy of
India (with specific explana ons provided for the interpreta on of "public
policy").
 Quote: "Enforcement of a foreign award may be refused, at the request of
the party against whom it is invoked, only if that party furnishes to the Court

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proof that— (a) the par es to the agreement referred to in sec on 44 were,
under the law applicable to them, under some incapacity..."
 Enforcement (Sec on 49): If the Court is sa sfied the foreign award is
enforceable, it shall be deemed a decree of that Court.
 Appealable Orders (Sec on 50): Appeals lie from orders refusing to refer
par es to arbitra on under Sec on 45 or refusing to enforce a foreign award
under Sec on 48. No second appeal is allowed, but the right to appeal to the
Supreme Court is preserved.
 Saving Clause (Sec on 51): This chapter does not prejudice any exis ng
rights to enforce awards in India even if this chapter had not been enacted.
 Chapter II Not to Apply (Sec on 52): Chapter II (Geneva Conven on Awards)
does not apply to foreign awards covered under Chapter I (New York
Conven on Awards).
 Geneva Conven on Awards (Chapter II of Part II):
 Interpreta on of "Foreign Award" (Sec on 53): Defines foreign awards
under the Geneva Conven on with specific criteria related to the date of the
award (a er July 28, 1924), the arbitra on agreement adhering to the
Geneva Protocol, and the na onality/jurisdic on of the par es and the place
of arbitra on being in territories no fied by the Central Government. Finality
of the award is also considered, excluding awards where validity challenges
are pending in the country of origin.
 Power of Judicial Authority to Refer Par es to Arbitra on (Sec on 54):
Similar to Sec on 45, but specifically for contracts and arbitra on
agreements falling under the Geneva Conven on.
 Foreign Awards When Binding (Sec on 55): Similar to Sec on 46, making
enforceable Geneva Conven on awards binding.
 Evidence (Sec on 56): Requires produc on of the original award or
authen cated copy, evidence of finality, and evidence that the condi ons for
enforcement under Sec on 57(1)(a) and (c) are met.

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 Condi ons for Enforcement (Sec on 57): Lays out condi ons that must be
proven for enforcement, including the validity of the submission to
arbitra on, arbitrability under Indian law, proper cons tu on of the arbitral
tribunal, finality of the award in the country of origin, and consistency with
Indian public policy or law. It also outlines grounds for refusal of
enforcement, such as annulment in the country of origin, lack of proper
no ce to the respondent, and the award dealing with ma ers beyond the
scope of submission.
 Enforcement (Sec on 58): Similar to Sec on 49, deeming enforceable
Geneva Conven on awards as decrees of the Court.
 Appealable Orders (Sec on 59): Appeals lie from orders refusing to refer
par es to arbitra on under Sec on 54 or refusing to enforce a foreign award
under Sec on 57. Similar provisions regarding second appeals and the
Supreme Court apply as in Sec on 50.
 Saving (Sec on 60): Similar to Sec on 51, preserving exis ng rights to
enforce awards outside this chapter.
Key Takeaways:
 The Arbitra on and Concilia on Act, 1996 provides a comprehensive
framework for recognizing and enforcing foreign arbitral awards in India.
 It incorporates the principles of both the New York and Geneva Conven ons,
with dis nct sets of criteria and procedures for each.
 The Act emphasizes the binding nature of valid foreign awards and limits the
grounds on which enforcement can be refused, reflec ng a pro-enforcement
stance.
 Understanding the defini on of a "foreign award" under each conven on and
the specific requirements for evidence and the grounds for refusal of
enforcement (par cularly concerning public policy) is cri cal for par es
seeking to enforce foreign awards in India.

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 Indian judicial authori es have a mandatory duty to refer par es to

arbitra on if a valid and opera ve arbitra on agreement under the relevant
conven on exists, unless specific grounds for refusal are met.

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CHAPTER 4: CONCILIATION

1. Execu ve Summary:
This Chapter outlines the key aspects of concilia on as a method of Alterna ve
Dispute Resolu on (ADR) under Part III of The Arbitra on and Concilia on Act, 1996
in India, based on the provided source. Concilia on is presented as a voluntary, non-
adversarial, and assisted procedure where a neutral third party (conciliator)
facilitates communica on between dispu ng par es to reach a mutually acceptable
se lement and rebuild rela onships. The document details the defini on,
characteris cs, commencement, appointment and role of conciliators, the process
of informa on sharing, the nature and effect of se lement agreements, and the
termina on of concilia on proceedings.
2. Main Themes and Important Ideas/Facts:
2.1. Defini on and Characteris cs of Concilia on:
 Defini on: Concilia on is understood as "a process of ge ng the par es to
come to an agreement about a common problem/dispute through
confiden al discussion and dialogue." It is similar to media on.
 Voluntary: "The process of concilia on is voluntary which implies that all
par es have to agree to have their disputes conciliated. Unless all the par es
involved in the dispute agree, the ma er cannot be conciliated. No party can
be forced to conciliate ma er or a end concilia on proceedings." This
principle of party autonomy and consent was upheld by the Supreme Court
of India in Afcons Infrastructure Ltd. Vs. Cherian Varkey Construc on Co. (P)
Ltd.
 Non-Adversarial: "Unlike arbitra on or court based adjudica on, the par es
do not compete against each other to prove themselves as correct and others
as wrong... Instead of focusing on win-lose, the a empt is to find a solu on

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to the problem that best suits all the par es involved, in such a manner that
no party is at worse off posi on."
 Assisted Procedure: Concilia on proceedings are flexible and tailored to the
par es' convenience, with the conciliator(s) present to assist in reaching a
se lement, including cra ing procedures for informa on sharing.
 Finality of Se lement: "The outcome i.e. se lement as an end result of the
concilia on process is final and binding between the par es."
 Confiden ality: "All aspects of the concilia on process are confiden al... the
conciliator(s) and the par es cannot disclose to persons who are not party to
concilia on, any ma er rela ng to the concilia on proceedings." Informa on
shared by one party with the conciliator must be disclosed to the other party
unless confiden ality is specifically requested. The se lement agreement
also falls under this confiden ality.
2.2. Concilia on in India (Legal Framework):
 Governed by Part III (Sec ons 61 to 81) of The Arbitra on and Concilia on
Act, 1996, and Sec on 89 of the Code of Civil Procedure 1908.
 Applicable to disputes arising out of any legal rela onship, whether
contractual or not.
 Not applicable where any exis ng law prohibits certain disputes from being
submi ed to concilia on or if the par es have agreed not to follow Part III.
 Sec on 61(1): "Save as otherwise provided by any law for the me being in
force and unless the par es have otherwise agreed, this Part shall apply to
applicability concilia on of disputes arising out of legal rela onship, whether contractual
or not and to all proceedings rela ng thereto."
 Sec on 61(2): "This part shall not apply where by virtue of any law for the
me being in force certain disputes may not be submi ed to concilia on."
2.3. Commencement of Concilia on Proceedings:
 Ini ated by a party sending a wri en invita on to the other party.

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 The invita on must briefly iden fy the subject of the dispute and state that
it is under Part III of the Act.
 Proceedings commence when the other party accepts the invita on in
wri ng. Oral acceptance is not sufficient.
 Rejec on of the invita on by the other party terminates the possibility of
concilia on proceedings.
 If no reply is received within 30 days (or a specified period in the invita on),
the ini a ng party may elect to treat it as a rejec on and must inform the
other party in wri ng.
 Sec on 62(1): "The party ini a ng concilia on shall send to the other party
a wri en invita on to conciliate under this Part, briefly iden fying the subject
proceedings
starting of the dispute."
process
 Sec on 62(2): "Concilia on proceedings, shall commence when the other
party accepts in wri ng the invita on to conciliate."
2.4. Appointment, Number, and Role of Conciliator(s):
 Number: Generally one conciliator, unless par es agree to two or three.
Mul ple conciliators should generally act jointly (Sec on 63).
 Reasons for preferring a sole conciliator include minimizing complexity,
quicker resolu on, lower cost, unified approach, clearer communica on,
heightened confiden ality, empowered par es, specific exper se, and
efficient se lement agreement dra ing.
 Appointment:For a sole conciliator, par es agree on the name (Sec on
64(1)(a)).
 For two conciliators, each party appoints one (Sec on 64(1)(b)).
 For three conciliators, each party appoints one, and they jointly agree on the
third who acts as the presiding conciliator (Sec on 64(1)(c)). The presiding
conciliator does not have the authority to make binding decisions unless
agreed upon by the par es.

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 Par es can enlist the assistance of ins tu ons or persons to recommend or

directly appoint conciliators (Sec on 64(2)).
 Such ins tu ons/persons must consider independence and impar ality and,
for sole or third conciliators, the advisability of appoin ng someone with a
different na onality than the par es (Proviso to Sec on 64(2)).
 Role:To assist par es in an independent and impar al manner to reach an
amicable se lement (Sec on 67(1)).
 Guided by principles of objec vity, fairness, and jus ce, considering the
rights and obliga ons of par es, trade usages, and circumstances of the
dispute (Sec on 67(2)).
 May conduct proceedings in a manner deemed appropriate, considering the
case's circumstances and the par es' wishes, including requests for oral
statements (Sec on 67(3)).
 May make proposals for se lement at any stage, which need not be in wri ng
or accompanied by reasons (Sec on 67(4)).
 Not bound by the Code of Civil Procedure, 1908, or the Indian Evidence Act,
1872 (Sec on 66), but must adhere to principles of natural jus ce. As held by
the Supreme Court in Haresh Dayaram Thakur Vs. State of Maharashtra and
Ors., a conciliator has wide procedural powers but must assist par es to
se le amicably.
2.5. Submission of Statements and Disclosure of Informa on:
 Upon appointment, the conciliator may request each party to submit a brief
wri en statement describing the nature of the dispute and points at issue,
with a copy to the other party (Sec on 65(1)).
 The conciliator may request further wri en statements of posi on,
suppor ng facts and grounds, and relevant documents/evidence, which must
also be shared with the other party (Sec on 65(2)).
 The conciliator can request addi onal informa on from a party at any stage
(Sec on 65(3)).

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 When the conciliator receives factual informa on from one party, the
substance must be disclosed to the other party to allow them to present an
explana on (Sec on 70).
 However, if informa on is provided confiden ally by a party, the conciliator
must not disclose it to the other party (Proviso to Sec on 70).
2.6. Se lement Agreement:
 When the conciliator believes a mutually acceptable se lement is possible,
they may formulate terms and submit them to the par es for observa on.
The conciliator can reformulate the terms based on these observa ons
(Sec on 73(1)).
 If the par es agree on a se lement, they may draw up and sign a wri en
se lement agreement. The conciliator can assist in this process if requested
(Sec on 73(2)).
 Upon signing, the se lement agreement is final and binding on the par es
and those claiming under them (Sec on 73(3)).
 The conciliator must authen cate the se lement agreement and provide a
copy to each party (Sec on 73(4)). If there are mul ple conciliators, all should
authen cate.
 The Supreme Court in Haresh Dayaram Thakur Vs. State of Maharashtra and
Ors. clarified that a se lement takes shape only when par es sign the
agreement or request the conciliator to prepare it and affix their signatures.
 Status and Effect: The se lement agreement has the same status and effect
as an arbitral award on agreed terms under Sec on 30 of the Act (Sec on
74). This was reiterated in Harsh Dayaram Thakur Vs. State of Maharashtra
and clarified in Mysore Cement Ltd. Vs. Suedalla Barmac Ltd. that the
agreement must be as per Sec on 73 to a ain the status of an Arbitral Award.
2.7. Termina on of Concilia on Proceedings:
 Concilia on proceedings are terminated in the following ways (Sec on 76):

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 By the signing of the se lement agreement by the par es, on the date of the
agreement (Sec on 76(a)).
 By a wri en declara on of the conciliator, a er consul ng the par es, sta ng
that further efforts are no longer jus fied, on the date of the declara on
(Sec on 76(b)).
 By a wri en declara on of the par es addressed to the conciliator sta ng
that the proceedings are terminated, on the date of the declara on (Sec on
76(c)).
 By a wri en declara on of a party to the other party and the conciliator (if
appointed) sta ng that the proceedings are terminated, on the date of the
declara on (Sec on 76(d)).
2.8. Administra ve Assistance:
 To facilitate the proceedings, par es or the conciliator (with the par es'
consent) may arrange for administra ve assistance from a suitable ins tu on
or person (Sec on 68). This can include providing lists of conciliators,
communica on services, and interpreta on of law.
2.9. Communica on between Conciliator and Par es:
 The conciliator may invite par es to meet or communicate orally or in
wri ng, either together or separately (Sec on 69(1)).
 The place of mee ngs is determined by agreement of the par es, or by the
conciliator a er consulta on with the par es, considering the circumstances
(Sec on 69(2)).
3. Conclusion:
The provided excerpts clearly define concilia on under The Arbitra on and
Concilia on Act, 1996, as a consensual and facilita ve ADR method aimed at
achieving mutually acceptable solu ons while preserving or rebuilding
rela onships between dispu ng par es. The Act lays down a structured yet flexible
framework governing the commencement, conduct, and termina on of concilia on
proceedings, emphasizing party autonomy, confiden ality, and the neutral role of

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the conciliator. The legally binding nature conferred upon a signed se lement
agreement underscores the significance of concilia on as an effec ve alterna ve to
li ga on and adversarial arbitra on.

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