1. Short title. extent and commencement.

(1) This Act may be called theArbitration and Conciliation Act, 1996 .

(2) It extends to the whole of India:Provided that Parts I, III and IV shall extend to the State of Jammu andKashmir only in so far as they relate to international commercial arbitrationor, as the case may be, international commercial conciliation. Explanation.- Inthis sub- section, the expression' international commercial conciliation'shall have the same meaning as the expression' international commercialarbitration' in clause (f) of sub- section (1) of section 2, subject tothe modification that for the word' arbitration' occurring therein, theword' conciliation' shall be substituted.

(3) It shall come into force on such dateas the Central Government may, by notification in the Official Gazette,appoint. PART ARBITRATION PART I ARBITRATION CHAP General provisions CHAPTER IGeneral provisions

The Arbitration and Conciliation Act, 1996 has repealed The Arbitration Act, 1940, The Arbitration (Protocol and Convention) Act, 1937 and The Foreign Awards (Recognition and Enforcement) Act, 1961. The history of the Arbitration and Conciliation Act, 1996 has been discussed in the previous chapters of this study. Arbitral awards, to define the law relating to conciliation of disputes. Where a provision of this Act, except section 30, leaves the parties free to determine a. Download commentary on arbitration and conciliation act 1996 or read online here in PDF or EPUB. Please click button to get commentary on arbitration and conciliation act 1996 book now. All books are in clear copy here, and all files are secure so don't worry about it.

2. Definitions.

(1) In this Part, unless the contextotherwise requires,-

(a) ' arbitration' means anyarbitration whether or not administered by permanent arbitral institution;

(b) ' arbitration agreement'means an agreement referred to in section 7;

(c) ' arbitral award' includesan interim award;

(d) ' arbitral tribunal' meansa sole arbitrator or a panel of arbitrators;

(e) ' Court' means theprincipal Civil Court of original jurisdiction in a district, and includes theHigh Court in exercise of its ordinary original civil jurisdiction, havingjurisdiction to decide the questions forming the subject- matter of thearbitration if the same had been the subject- matter of a suit, but does not-include any civil court of a grade inferior to such principal Civil Court, orany Court of Small Causes;

(f) ' international commercialarbitration' means an arbitration relating to disputes arising out oflegal relationships, whether contractual or not, considered as commercial underthe law in for in India and where at least one of the parties is-

(i) an individual who is a national of,or habitually resident in, any country other than India; or

(ii) a body corporate which isincorporated in any country other than India; or

(iii) a company or ail association or abody of individuals whose central management and control is exercised in anycountry other than India; or

(iv) the Government of a foreign country;

(g) ' legal representative'means a person who in law represents the estate of a deceased person, andincludes any person who intermeddles with the estate of the deceased, and,where a party acts in a representative character, the person on whom the estatedevolves on the death of the party so acting;

(h) ' party' means a party toan arbitration agreement.

(2) Scope. This Pail shall apply wherethe place of arbitration is in India.

(3) This Part shall not affect any otherlaw for the time being in force by virtue of which certain disputes may not besubmitted to arbitration.

(4) This Part except sub- section (1) ofsection 40, sections 41 and 43 shall apply to every arbitration under any otherenactment for the time being in force, as if the arbitration were pursuant toan arbitration agreement and as if that other enactment were an arbitrationagreement, except in so far as the provisions of this Part, are inconsistentwith that other enactment or with any rules made thereunder.

(5) Subject to the provisions of sub-section (4), and save in so, far as is otherwise provided by any law for thetime being in force or in any agreement in force between India and any othercountry or countries. this Part shall apply to all arbitrations and to allproceedings relating thereto.

Construction of references.

(6) Construction of references. Wherethis Part, except section 28, leaves the parties free to determine a certainissue, that freedom shall include the right of the parties to authorise anyperson including an institution, to determine that issue.

(7) An arbitral award made under this,Part shall be considered as a domestic award.

(8) Where this Part-

(a) refers to the fact that the partieshave agreed or that they may agree, or

(b) in any other way refers to anagreement of the patties,

that agreement shall include any arbitration rulesreferred to in that agreement.

(9) Where this Part, other than clause(a) of section 25 or clause (a) of sub- section (2) of section 32, refers to aclaim, it shall also apply to a counterclaim, and where it refers to a defence,it shall also apply to a defence to that counterclaim.

3. Receipt of written communications.

(1) Unless otherwise agreed by theparties,-

(a) any written communication is deemedto have been received if it is delivered to the addressee personally or at hisplace of business, habitual residence or mailing address, and

(b) if none of the places referred to inclause (a) can be found after making a reasonable inquiry, a writtencommunication is deemed to have been received if it is sent to the addressee' slast known place of business, habitual residence or mail address by registeredletter or by any other means which provides a record of the attempt to deliverit.

(2) The communication is deemed to havebeen received on the day it is so delivered.

(3) This section does not apply towritten communications in respect of proceedings of any judicial authority.

4. Waiver of right to object. A party whoknows that-

(a) any provision of this Part from whichthe parties may derogate. or

(b) any requirement under the arbitrationagreement. has not been- complied with and yet proceeds with the arbitrationwithout stating his objection to such non- compliance without undue delay or,if a time limit is provided for slating that objection, within that period oftime, shall be deemed to have waived his right to so object.

5. Extent of judicial intervention.Notwithstanding anything contained in any other law for the time being inforce, in matters governed by this Part, no judicial authority shall interveneexcept where so provided in this Part.

6. Administrative assistance. In order tofacilitate the conduct of die arbitral proceedings, the parties, or thearbitral tribunal with the consent of the parties, may arrange foradministrative assistance by a suitable institution or person. CHAP Arbitrationagreement CHAPTER II Arbitration agreement

7. Arbitration agreement.

(1) In this Part,' arbitration agreement'means an agreement by the parties to submit to arbitration all or certaindisputes which have arisen or which may arise between them in respect of adefined legal relationship, whether contractual or not.

(2) An arbitration agreement may be inthe form of an arbitration clause in a contract or in the form of a separateagreement.

(3) An arbitration agreement shall be inwriting.

(4) An arbitration agreement is inwriting if it is contained in-

(a) a document signed by the parties;

(b) an exchange of letters, telex,telegrams or other means of telecommunication which provide a record of theagreement; or

(c) an exchange of statements of claimand defence in which the existence of the agreement is alleged by one party andnot denied by the other.

(5) The reference in a contract to adocument containing an arbitration clause constitutes an arbitration agreementif the contract is in writing and the reference is such as to make thatarbitration clause part of the contract.

8. Power to refer parties to arbitrationwhere there is an arbitration agreement.

(1) A judicial authority before which anaction is brought in a matter which is the subject of an arbitration agreementshall, if a party so applies not later than when submitting his first statementon the substance of the dispute, refer the parties to arbitration.

(2) The application referred to insubsection (1) shall not be entertained unless it is accompanied by theoriginal arbitration agreement or a duly certified copy thereof.

(3) Notwithstanding that an applicationhas been made under sub- section (1) and that the issue is pending before thejudicial authority, an arbitration may be commenced or continued and anarbitral award made.

9. Interim measures etc. by Court. Aparty may, before, or during arbitral proceedings or at any time after themaking of the arbitral award but before it is enforced in accordance withsection 36, apply to a court-

(i) for the appointment of a guardian fora minor or person of unsound mind for the purposes of arbitral proceedings; or

(ii) for an interim measure of protectionin respect of any of die following matters, namely:-

(a) the preservation, interim custody orsale of any goods which are the subject- matter of the arbitration agreement;

(b) securing the amount in dispute in thearbitration;

(c) the detention, preservation or inspectionof any property or thing which is die subject- matter of the dispute inarbitration, or as to which any question may arise therein and authorising forany of the aforesaid purposes any person to enter upon any land or building inthe possession of any part or authorising any samples to be taken or anyobservation to be made, or experiment to be tried, which may be necessary orexpedient for the purpose of obtaining full information or evidence;

(d) interim injunction or the appointmentof a receiver;

(e) such other interim measure ofprotection as may appear to the Court to be just and convenient, and the Courtshall have the same power for making orders as it has for the purpose of, andin relation to, any proceedings before it. CHAP Composition of arbitraltribunal CHAPTER III Composition of arbitral tribunal

10. Number of arbitrators.

(1) The parties are free to determine thenumber of arbitrators, provided that such number shall not be an even number.

(2) Failing the determination referred toin sub- section (1), the arbitral tribunal shall consist of a sole arbitrator.

11. Appointment of arbitrators.

(1) A person of any nationality may be anarbitrator, unless otherwise agreed by the parties.

(2) Subject to sub- section (6), theparties are free to agree on a procedure for appointing the arbitrator or arbitrators.

(3) Failing any agreement referred to insub- section (2), in an arbitration with three arbitrators, each party shallappoint one arbitrator, and the two appointed arbitrators, shall appoint thethird arbitrator who shall act as the presiding arbitrator.

(4) If the appointment procedure in sub-section (3) applies and-

(a) a party fails to appoint anarbitrator within thirty days from the receipt of a request to do so from theother party; or

(b) the two appointed arbitrators fail toagree on the third arbitrator within thirty days from the date of theirappointment, the appointment shall be made upon request of a party, by thechief justice or any person or institution designated by him.

(5) Failing any agreement referred to insub- section (2), in an arbitration with a sole arbitrator if the parties failto agree on the arbitrator within thirty days from receipt of a request by oneparty from the other party to so agree the appointment shall be made, uponrequest of a party, by the Chief Justice of any person or institutiondesignated by him.

(6) Where, under an appointment procedureagreed upon by the parties,-

(a) a party fails to act as requiredunder that procedure; or

(b) the parties, or the two appointedarbitrators, fail to reach an agreement expected of them under that procedure;or

(c) a person, including an institution,fails to perform any function entrusted him or it under that procedure, a partymay request the Chief Justice or any person or institution designated by himtake the necessary measure, unless the agreement on the appointment procedureprovides other means for securing the appointment.

(7) A decision on a matter entrusted bysub- section (4) or sub- section (5) or sub section (6) to the Chief Justice orthe person or institution designated by him is final.

(8) The Chief' Justice or the person orinstitution designated by him, in appointing arbitrator, shall have due regaledto-

(a) any qualifications required of thearbitrator by the agreement of the parties and

(b) other considerations as are likely tosecure the appointment of an independent, and impartial arbitrator.

(9) In the case of appointment of sole orthird arbitrator in an intenational commercial arbitration, the Chief Justiceof India or the person or institution designated by him may appoint anarbitrator of a nationality other than the nationalities of the

parties where the parties belong to differentnationalities.

(10) The Chief Justice may make suchscheme as he may deem appropriate for dealing with matters entrusted by sub-section (4) or sub- section (5) or sub- section (6) to him.

(11) Where more than one request has beenmade under sub- section (4) or subsection (5) or sub- section (6) to the ChiefJustices of different High Courts or their designates, the Chief Justice or hisdesignate to whom the request has been first made under the relevant sub-section shall alone be competent to decide on the request.

(12) (a) Where the matters referred to insub- sections (4), (6), (7), (8) and (10) arise in an international commercialarbitration the reference to' Chief Justice' in those subsectionsshall he construed as a reference to the' Chief Justice of India.'

(b) Where the matters referred to in sub-sections (4), (5), (7), (8), and (10) arise in any other arbitration, thereference to' Chief Justice' in those sub- sections shall heconstrued as a reference to the Chief Justice of the High Court within whoselocal limits the principal Civil Court referred to in clause (e) of sub-section (1) of section 2 is situate and, where the High Court itself is theCourt referred to in that clause, to the Chief justice of that High Court.

12. Grounds for challenge.

(1) When a person is approached inconnection with his possible appointment as an arbitrator, he shall disclose inwriting any circumstances likely to give rise to justifiable doubts as to hisindependence or impartiality.

(2) An arbitrator, from the time of hisappointment and throughout the arbitral proceedings, shall, without delay,disclose to the parties in writing any circumstances referred to in sub section(1) unless they have already been informed of them by him.

(3) An arbitrator may be challenged onlyif-

(a) circumstances exist that give rise tojustifiable doubts as to his independence or impartiality, or

(b) he does not possess thequalifications agreed to by the parties.

(4) A party may challenge an arbitratorappointed by him, or in whose appointment he has participated, only for reason,of which he becomes aware after the appointment has been made.

13. Challenge procedure.

(1) Subject to sub- section (4), theparties are free to agree on a procedure for challenging an arbitrator.

(2) Failing any agreement referred to insub- section (1), a party who intends to challenge an arbitrator shall, withinfifteen days after becoming aware of the constitution of the arbitral tribunalor after becoming aware of any circumstances referred to in subsection (3) ofsection 12, send a written statement of the reasons for the challenge to thearbitral tribunal.

(3) Unless the arbitrator challengedunder sub- section (2) withdraws from his office or the other party agrees tothe challenge, the arbitral tribunal shall decide on the challenge.

(4) If a challenge tinder any procedureagreed upon by the parties or tinder the procedure under sub- section (2) isnot successful, the arbitral tribunal shall continue the arbitral proceedingsand make an arbitral award.

(5) Where an arbitral award is made undersub- section (4), the party challenging the arbitrator may make an applicationfor setting aside such an arbitral award in accordance with section 34.

(6) Where an arbitral award is set asideon an application made under sub- section (5), the Court may decide as towhether the arbitrator who is challenged is untitled to any fees.

14. Failure or impossibility to act.

(1) The, mandate of an arbitrator shallterminate if-

(a) he becomes de jure or de facto unableto perform his functions or for other reasons fails to act without undue delay;and

(b) he withdraws from his office or theparties agree to the termination of his mandate.

(2) If a controversy remains concerningany of the grounds referred to in clause (a) of sub- section (1), a party may,unless otherwise agreed by the parties, apply to the Court to decide on thetermination of the mandate.

(3) If, under this section or sub-section (3) of section 1. 3, an arbitrator withdraws from his office or a partyagrees to the termination of the mandate of an arbitrator, it shall not implyacceptance of the validity of any ground referred to in this section or sub-section (3) of section 12.

15. Termination of mandate and substitutionof arbitrator.

(1) In addition to the circumstancesreferred to in section 13 or section 14, the mandate of an arbitrator shallterminate-

(a) where he withdraws from office forany reason; or

(b) by or pursuant to agreement of theparties.

(2) Where the mandate of an arbitrator terminates,a substitute arbitrator shall be appointed according to the rules that wereapplicable to the appointment of the arbitrator being replaced.

(3) Unless otherwise agreed by theparties, where an arbitrator is replaced under subsection (2), any hearingspreviously held may be repeated at the discretion of the arbitral tribunal.

(4) Unless otherwise agreed by theparties, an order or ruling of the arbitral tribunal made prior to thereplacement of an arbitrator under this section shall not be invalid solelybecause there has been a change in the composition of the arbitral tribunal.CHAP Jurisdiction of arbitral tribunals CHAPTER IV Jurisdiction of arbitraltribunals

16. Competence of arbitral tribunal torule on its jurisdiction.

(1) The arbitral tribunal may rule on itsown jurisdiction, including ruling on any objections with respect to theexistence or validity of the arbitration agreement, and for that purpose,-

(a) an arbitration clause which formspart of a contract shall be treated as an agreement independent of the otherterms of the contract; and

(b) a decision by the arbitral tribunalthat the contract is null and void shall not entail ipso jure the invalidity ofthe arbitration clause.

(2) A plea that the arbitral tribunaldoes not have jurisdiction shall be raised not later than the submission of thestatement of defence; however, a party shall not be precluded from raising sucha pica merely because that he has appointed, or participated in the appointmentof, an arbitrator.

(3) A plea that the arbitral tribunal isexceeding the scope of its authority shall be raised as soon as the matteralleged to be beyond the scope of its authority is raised during the arbitralproceedings.

(4) The arbitral tribunal may, in eitherof the cases referred it, in sub- section (2) or sub- section (3), admit alater plea if it considers the delay justified.

(5) The arbitral tribunal shall decide ona plea referred to in sub section (2) or subsection (3) and, where the arbitraltribunal takes a decision rejecting the plea, continue with die arbitralproceedings and make an arbitral award.

(6) A party aggrieve by such an arbitralaward may make an application for setting aside such an arbitral award inaccordance with section 34.

17. Interim measures ordered by arbitraltribunal.

(1) Unless otherwise agreed by theparties, the arbitral tribunal may, at the request of a party, order a party ittake any interim measure of protection as the arbitral tribunal may considernecessary in respect of the subject matter of the dispute.

(2) The arbitral tribunal may require aparty to provide appropriate security in connection with a measure orderedunder sub- section (1). CHAP Conduct of arbitral proceedings CHAPTER V Conductof arbitral proceedings

18. Equal treatment of parties. Theparties shall be, treated with equality and each party shall be given a fullopportunity to present his case.

19. Determination of rules of procedure.

(1) The arbitral tribunal shall not bebound by the Code of Civil Procedure, 1908 (5 of 1908 ). or the Indian EvidenceAct, 1872 (1 of 1872 ).

(2) Subject to this Part, the parties arefree to agree on the procedure to be followed by the arbitral tribunal inconducting its proceedings.

(3) Failing any agreement referred to insub- section (2), the arbitral tribunal may, subject to this Part, conduct theproceedings in the manner it considers appropriate.

(4) The power of the arbitral tribunal undersub- section (3) includes the power to determine the admissibility, relevance,materiality and weight of' any evidence.

20. Place of arbitration.

(1) The parties are free to agree on theplace of arbitration.

(2) Failing any agreement referred to insub- section (1), the place of arbitration shall be determined by the arbitraltribunal having regard to the circumstances of the case, including theconvenience of the parties.

(3) Notwithstanding sub- section (1) orsub- section (2), the arbitral tribunal may, unless otherwise agreed by theparties, meet at any place it considers appropriate for consultation among itsmembers, for hearing witnesses, experts or the parties, or for inspection ofdocuments, goods or other property.

21. Commencement of arbitral proceedings.Unless otherwise agreed by the parties, the arbitral proceedings in respect ofa particular dispute commence on the date on which a request for that disputeto be referred to arbitration is received by the respodent.

22. Language.

(1) The parties are free to agree uponthe language or languages to be used in the arbitral proceedings.

(2) Failing any agreement referred to insub- section (1), the arbitral tribunal shall determine the language orlanguages to he used in the arbitral proceedings.

(3) The agreement or determination,unless otherwise specified shall apply to any written statement by a party, anyhearing and any arbitral award, decision or other communication by the arbitraltribunal.

(4) The arbitral tribunal may order thatany documentary evidence shall be accompanied by a translation into thelanguage or languages agreed upon by the parties or determined by the arbitraltribunal.

23. Statements of claim and defence.

(1) Within the period of time agreed uponby the parties or determined by the arbitral tribunal, the claimant shall statethe facts supporting his claim, the points at issue and the relief or remedysought, and the respondent shall state his defence in respect of theseparticulars, unless the parties have otherwise agreed as to the requiredelements of those statements.

(2) The parties may submit with theirstatements all documents they consider to be relevant or may add a reference tothe documents or other evidence they will submit.

(3) Unless otherwise agreed by theparties, either party may amend or supplement his claim or defence during thecourse of the arbitral proceedings, unless the arbitral tribunal considers itinappropriate to allow the amendment or supplement having regard to the delay inmaking it.

24. Hearings and written proceedings.

(1) Unless otherwise agreed by theparties, the arbitral tribunal shall decide whether to hold oral hearings forthe presentation of evidence or for oral argument, or whether the proceedingsshall be conducted oil the basis of documents and other materials: Providedthat the arbitral tribunal shall hold oral hearings, at an appropriate stage ofthe proceedings, on a request by a party, unless the parties have agreed thatno oral hearing shall be held.

(2) The parties shall be given sufficientadvance notice of any hearing and of any meeting of the arbitral tribunal forthe purposes of inspection of documents, goods or other property.

(3) All statements, documents or otherinformation supplied to, or applications made to, the arbitral tribunal by oneparty shall be communicated to the other party, and any expert report orevidentiary document on which the arbitral tribunal may rely in making itsdecision shall be communicated to the parties.

25. Default of a party. Unless otherwiseagreed by the parties, where, without showing sufficient cause,-

(a) the claimant fails to communicate hisstatement of claim in accordance with sub- section (1) of section 23, thearbitral tribunal shall terminate the proceedings;

(b) the respodent fails to communicatehis statement of defence in accordance with sub- section (1) of section 23, thearbitral tribunal shall continue the proceedings without treating that failurein itself as an admission of the allegation of the allegation by the claimant;

(c) a party fails to appear a an oral hearingor to produce documentary evidence. the arbitral tribunal may continue theproceedings and make the arbitral award on the evidence before it.

26. Expert appointed by arbitraltribunal.

(1) Unless otherwise agreed by theparties, the arbitral tribunal may-

(a) appoint one or more expert to reportto it on specific issues to be determined by the arbitral tribunal, and

(b) require a party to give the expertany relevant information or to produce. or to provide access to, any relevantdocuments, goods or other property for his inspection.

(2) Unless otherwise agreed by theparties, if a party so requests or if the arbitral tribunal considers itnecessary, the expert shall, after delivery of his written or oral report,participate in an oral hearing where the parties have the opportunity to putquestions to him and to present expert witnesses in order to testify on thepoints at issue.

(3) Unless otherwise agreed by the parties,the expert shall, on the request of a party, make available to that party forexamination all documents, goods or other property in the possession of theexpert with which he was provided in order to prepare his report.

27. Court assistance in taking evidence.

(1) The arbitral tribunal, or a partywith the approval of the arbitral tribunal, may apply to the Court forassistance in taking evidence.

(2) The application shall specify-

(a) the raises and addresses of thepanics and the arbitrators,

(b) the general nature of the claim andthe relief sought,-

(c) the evidence to be obtained, inparticular,-

(i) the name and addresses of any personto be heard as witness or expert witness and a statement of the subject- matterof the testimony required;

(ii) the description of any document tobe produced or property to be inspected.

(3) The Court may, within its competenceand according to its rules on taking evidence, execute the request by orderingthat the evidence be provided directly to the arbitral tribunal.

(4) The Court may, while making an orderunder sub- section (3), issue the same processes to witnesses as it may issuein suits tried before it.

(5) Persons failing to attend inaccordance with such process, or making any other default, or refusing to givetheir evidence, or guilty of any contempt to the arbitral tribunal during theconduct of arbitral proceedings, shall be subject to the like disadvantages,penalties and punishments by order of the Court on the representation of

the arbitral tribunal as they would for the likeoffences in suits tried before the Court.

(6) In this section the expression'Processes' includes summonses and commissions for the examination ofwitnesses and summonses to produce documents. CHAP Making of arbitral award andtermination of proceedings CHAPTER VI Making of arbitral award and terminationof proceedings

28. Rules applicable to substance ofdispute.

(1) Where the place of arbitration issituate in India,-

(a) in an arbitration other than aninternational commercial arbitration, the arbitral tribunal shall decide thedispute submitted to arbitration in accordance with the substantive law for thetime being in force in India;

(b) in international commercialarbitration,-

(i) the arbitral tribunal shall decidethe dispute in accordance with the rules of law designated by the parties as applicableto the substance of the dispute;

(ii) any designation by the parties ofthe law or legal system of a given country shall be construed, unless otherwiseexpressed, as directly referring to die substantive law of that country and notto its conflict of laws rules;

(iii) failing any designation of the lawunder clause (a) by the parties, the arbitral tribunal shall apply the rules oflaw it considers to be appropriate given all the circumstances surrounding thedispute.

(2) The arbitral tribunal shall decide exaequo et bono or as amiable compositeur only if the parties have expressly authorisedit to do so.

(3) In all cases, the arbitral tribunalshall decide in accordance with the terms of the contract and shall take intoaccount the usages of the trade applicable to the transaction.

29. Decision making by panel ofarbitrators.

(1) Unless otherwise agreed by theparties, in arbitral proceedings with more than one arbitrator, any decision ofthe arbitral tribunal shall be made by a majority of all its members.

(2) Notwithstanding sub- section (1), ifauthorised by the parties or all the members of the arbitral tribunal,questions of procedure may be decided by the presiding arbitrator.

30. Settlement.

(1) It is not incompatible with anarbitration agreement for an arbitral tribunal to encourage settlement of thedispute and, with the agreement of the parties, the arbitral tribunal may usemediation, conciliation or other procedures at any time during the arbitralproceedings to encourage settlement.

(2) If, during arbitral proceedings, theparties settle the dispute, the arbitral tribunal shall terminate theproceedings and, if requested by the parties and not objected to by thearbitral tribunal, record die settlement in the form of an arbitral award onagreed terms.

(3) Am arbitral award on agreed termsshall be made in accordance with section 31 and shall state that it is anarbitral award.

(4) An arbitral award on agreed termsshall have the same status and effect as any other arbitral award on thesubstance of the dispute.

31. Form and contents of arbitral award.

(1) An arbitral award shall be made inwriting and shall be signed by the members of the arbitral tribunal.

(2) For the purposes of sub- section (1),in arbitral proceedings with more than one arbitrator, the signatures of themajority of all the members of the arbitral tribunal shall be sufficient solong as the reason for any omitted signature is stated.

(3) The arbitral award shall state thereasons upon which it is based, unless-

(a) the parties have agreed that nomasons are to be given, or

(b) the award is an arbitral award onagreed terms under section 30.

(4) The arbitral award shall state itsdate and the place of arbitration as determined in accordance with section 20and the award shall be deemed to have been made at that place.

(5) After the arbitral award is made, asigned copy shall be delivered to each party.

(6) The, arbitral tribunal may, at anytime during the arbitral proceedings, make an interim arbitral award on anymatter with respect to which it may make a final arbitral award.

(7) (a) Unless otherwise agreed by theparties, where and in so far as an arbitral award is for the payment of money,the arbitral tribunal may include in the sum for which the award is madeinterest, at such rate as it deems reasonable, an the whole or any pan of themoney, for the whole or any pad of the period between the date on which thecause of action arose and the date on which the award is made.

(b) A sum directed to be paid by anarbitral award shall, unless the award otherwise directs, carry interest at therate of eighteen per centum per annum from the date of the award to the date ofpayment.

(8) Unless otherwise agreed by theparties,-

(a) the costs of an arbitration shall befixed by the arbitral tribunal;

(b) the arbitral tribunal shall specify-

(i) the party entitled to costs,

(ii) the party who shall pay the costs,

(iii) the amount of costs or method ofdetermining that amount, and

(iv) the manner a which the costs shallbe paid. Explanation,- For the purpose of clause (a),' costs' meansresponsible costs relating to-

(i) the fees and expenses of thearbitrators and witnesses,

(ii) legal fees and expenses,

(iii) any administration fees of theinstitution supervising the arbitration, and

(iv) any other expenses incurred inconnection with the arbitral proceedings and the arbitral award.

32. Termination of proceedings.

(1) The arbitral proceedings shall beterminated by the final arbitral award or by an order of the arbitral tribunalunder sub- section (2).

(2) The arbitral tribunal shall issue anorder for the termination of the arbitral proceedings where-

(a) the claimant withdraws his claim,unless the respondent objects to the order and the arbitral tribunal recognisesa legitimate interest on his part in, obtaining a final settlement of thedispute,

(b) the parties agree on the terminationof the proceedings, or

(c) the arbitral tribunal finds that thecontinuation of the proceedings has for any other mason become unnecessary orimpossible.

(3) Subject to section 33 and sub-section (4) of section 34, the mandate of the arbitral tribunal shall terminatewith the termination of the arbitral proceedings.

33. Correction and interpretation ofaward; additional award.

(1) Within thirty days from the receiptof the arbitral award, unless another period of time has been agreed upon bythe parties-

(a) a party, with notice to the otherparty, may request the arbitral tribunal to correct any computation errors, anyclerical or typographical errors or any other errors of a similar natureoccurring in the award;

(b) if go agreed by the parties, a party,with notice to the other party, may request the arbitral tribunal to give aninterpretation of a specific point or part of the award.

(2) If the arbitral tribunal considersthe request made under sub- section (1) to be justified, it shall make thecorrection or give the interpretation within thirty days from the receipt ofthe request and the interpretation shall form pan of the arbitral award.

(3) The arbitral tribunal way correct anyerror of the type referred to in clause (a) of sub- section (1), on its owninitiative, within thirty days from the date of the arbitral award.

(4) Unless otherwise agreed by theparties, a party with notice to the other party, may request, within thirtydays from the receipt of the arbitral award, the arbitral tribunal to make an additionalarbitral award as to claims presented in the arbitral proceedings but omittedfrom the arbitral award.

(5) If the arbitral tribunal considersthe request made under sub- section (4) to be justified, it shall make theadditional arbitral award within sixty days from the receipt of such request.

(6) The arbitral tribunal may extend, ifnecessary, the period of time within which it shall make a correction, give aninterpretation or make an additional arbitral award under sub- section (2) orsub- section (5).

(7) Section 31 shall apply to aconnection or interpretation of the arbitral award or to an additional arbitralaward made under this section.

CHAP Recourse against arbitral award CHAPTER VIIRecourse against arbitral award

34. Application for setting asidearbitral award.

(1) Recourse to a Court against anarbitral award may be made only by an application for setting aside such awardin accordance with sub- section (2) and subsection (3).

(2) An arbitral award may be set aside bythe Court only if-

(a) the party making the applicationfurnishes proof that-

(i) a party was under some incapacity, or

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(ii) the arbitration agreement is notvalid under the law to which the parties have subjected it or, failing anyindication thereon, under the law for the time being in force; or

(iii) the party making the applicationwas not given proper notice of the appointment of an arbitrator or of thearbitral proceedings or was otherwise unable to present his case; or

(iv) the arbitral award deals with adispute not contemplated by or not falling within the terms of the submissionto arbitration, or it contains decisions on matters beyond the scope of thesubmission to arbitration: Provided that, if the decisions on matters submittedto arbitration can be separated from those not so submitted, only that part ofthe arbitral award which contains decisions on matters not submitted toarbitration may be set aside; or

(v) the composition of the arbitraltribunal or the arbitral procedure was not in accordance with the agreement ofthe parties, unless such agreement was in conflict with a provision of thisPart from which the parties cannot derogate, or, failing such agreement, wasnot in accordance with this Part; or

(b) the Court finds that-

(i) the subject- matter of the dispute isnot capable of settlement by arbitration under the law for the time being inforce, or

(ii) the arbitral award is in conflictwith the public policy of India. Explanation.- Without prejudice to thegenerality of sub- clause (ii), it is hereby declared, for the avoidance of anydoubt, that an award is in conflict with the public policy of India if themaking of the award was induced or affected by fraud or corruption or was inviolation of section 75 or section 81.

(3) An application for setting aside maynot be made after three months have elapsed from the date on which die partymaking that application had received the arbitral award or, if a request hadbeen made under section 33, from the date on which that request had bowdisposed of by the arbitral tribunal: Provided that if the Court is satisfiedthat the applicant was prevented by sufficient cause from making theapplication within the said period of three months it may entertain theapplication within a further period of thirty days, but not thereafter.

(4) On receipt of an application undersub- section (1), the Court may, where it is

appropriate and it is so requested by a party,adjourn the proceedings for a period of time determined by it in order to givethe arbitral tribunal an opportunity to resume the arbitral proceedings or totake such other action as in the opinion of arbitral tribunal will eliminatethe grounds for setting aside the arbitral award. CHAP Finality and enforcementof arbitral awards CHAPTER VIII Finality and enforcement of arbitral awards

35. Finality of arbitral awards. Subjectto this Part an arbitral award shall be final and binding on the parties andpersons claiming under them respectively.

36. Enforcement. Where the tune formaking an application to set aside the, arbitral award under award shall beendorced under the Code of Civil Procedure, 1908 (5 of 1908 ). in the samemanner as if it were a decree of the Court. CHAP Appeals CHAPTER IX Appeals

37. Appealable orders.

(1) An appeal shall lie from thefollowing orders (and from no others) to the Court authorised by law to hearappeals from original decrees of the Court passing the older, namely :-

(a) granting or refusing to grant anymeasure under section 9;

(b) setting aside or refusing to set asidean arbitral award under section 34.

(2) Appeal shall also lie to a court froman order of the arbitral tribunal-

(a) accepting the plea referred to insub- section (2) or sub- section (3) of section 16; or

(b) granting or refusing to grant aninterim measure under section 17.

(3) No second appeal shall lie from anorder passed in appeal under this section, but nothing in this section shallaffect or take away any right to appeal to the Supreme Court. CHAPMiscellaneous CHAPTER X Miscellaneous

38. Deposits.

(1) The arbitral tribunal may fix theamount of the deposit or supplementary deposit, as the case way be, as anadvance for the costs referred to in sub- section (8) of section 31, which itexpects will be incurred in respect of the claim submitted to it. Provided thatwhere, apart from the claim, a counter- claim has been submitted to thearbitral tribunal, it may fix separate amount of deposit for the claim and counterclaim.

(2) The deposit referred to in sub-section (1) shall be payable in equal shares by the parties: Provided thatwhere one party fails to pay his sham of the deposit, the other patty may paythat share: Provided further that where the other party also does not pay theaforesaid share in respect of the claim or the counter- claim, the arbitraltribunal may suspend or terminate the arbitral proceedings in respect of suchclaim or counter- claim, as the case may be.

(3) Upon termination of the arbitralproceedings, the arbitral tribunal shall render an accounting to the parties ofthe deposits received and shall return any unexpended balance to the party orparties, as the case may be.

39. Lien on arbitral award and depositsas to costs.

(1) Subject to the provisions of sub-section (2) to any provision to the contrary in the arbitration agreement, thearbitral tribunal shall have a lien on the arbitral award for any unpaid costsof the arbitration.

(2) If in any case an arbitral tribunalrefuses to deliver its award except on payment of the costs demanded by it, theCourt may, on an application in this behalf, order that the arbitral tribunalshall deliver the arbitral award to the applicant on payment into Court by theapplicant of the costs demanded, and shall, after such inquiry, if any, as itthinks fit, further order that out of the money so paid into Court there shallbe paid to the arbitral tribunal by way of costs such sum as the Court mayconsider reasonable and that the balance of the money, if any, shall berefunded to the applicant.

(3) An application under sub- section (2)may be made by any party unless the fees demanded have been fixed by writtenagreement between him and the arbitral tribunal and the arbitral tribunal shallbe entitled to appear and he heard on any such application.

(4) The Court may make such orders as itthinks fit respecting the costs of the arbitration where any question arisesrespecting such costs and the arbitral award contains no sufficient provisionconcerning them.

40. Arbitration agreement not to bedischarged by death of party thereto.

(1) An arbitration agreement shall not bedischarged by the death of any party thereto either as respects the deceasedor, as respects any other party, but shall in such event be enforceable by oragainst the legal representative of the deceased.

(2) The mandate of an arbitrator shallnot be terminated by the death of' any party by whom he was appointed.

(3) Nothing in this section shall affectthe operation or any law by virtue of which any right of action is extinguishedby the death of a person.

41. Provisions in case of insolvency.

(1) Where it is provided by a term in acontract to which an insolvent is a party that any dispute arising thereout orin connection therewith shall be submitted to arbitration, the said term shall,if the receiver adopts the contract, be enforceable by or against him so far asit relates to any such dispute.

(2) Where a person who has been adjudgedan insolvent bad, before the commencement of the insolvency proceedings, becomea party to an arbitration agreement, and any matter to which the agreementapplies is required to be determined in connection with, or for the purposesof, the insolvency proceedings, then, if the case is one to which sub- section(1) does not apply, any other party or the receiver may apply to the judicialauthority having jurisdiction in the insolvency proceedings for an orderdirecting that the matter in question shall be submitted to arbitration inaccordance with the arbitration agreement, and the judicial authority may, ifit is of opinion that, having regard to all the circumstances of the case, thematter ought to be determined by arbitration, make an order accordingly.

(3) In this section the expression'receiver' includes an Official Assignee.

42. Jurisdiction. Notwithstandinganything contained elsewhere in this Part or in any other law for the timebeing in force, where with respect to an arbitration agreement any applicationunder this Part has been made in a Court, that Court alone shall havejurisdiction over

the arbitral proceedings and all subsequentapplications arising out of that agreement and the arbitral proceedings shallbe made in that Court and in no other Court.

43. Limitations.

(1) The Limitation Act, 1963 (36 of 1963 ),shall apply to arbitrations as it applies to proceedings in court.

(2) For the purposes of this section andthe Limitation Act, 1963 (36 of 1963 ), an arbitration shall be deemed to havecommenced on the date referred in section 21.

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(3) Where an arbitration agreement tosubmit future disputes to arbitration provides that any claim to which theagreement applies shall be barred unless some steps to commence arbitralproceedings is taken within a time fixed by the agreement, and a dispute arisesto which the agreement applies, the Court, if it is of opinion that in thecircumstances of the case undue hardship would otherwise be caused, and notwithstandingthat the time so fixed has expired, may on such terms, if any, as the justiceof the case may require, extend the time for such period as it thinks proper.

(4) Where the Court orders that anarbitral award be set aside, the period between the commencement of the,arbitration and the date of the order of the Court shall be excluded incomputing the time prescribed by the Limitation Act, 1963 (36 of 1963 ), forthe commencement of the proceedings (including arbitration) with respect to thedispute so submitted. PART ENFORCEMENT OF CERTAIN FOREIGN AWARDS PART IIENFORCEMENT OF CERTAIN FOREIGN AWARDS CHAP New York Convention Awards CHAPTER INew York Convention Awards

44. Definition. In this Chapter, unlessthe context otherwise requires,' foreign award' means an arbitralaward on differences between persons arising out of legal relationships,whether contractual or not, considered as commercial under the law in force hiIndia, made on or after the 11th day of October, 1960 -

(a) in pursuance of an agreement inwriting for arbitration to which the Convention set forth in the First Scheduleapplies, and

(b) in one of such territories as theCentral Government, being satisfied that reciprocal provisions have been mademay, by notification in the Official Gazette. declare to be territories towhich the said Convention applies.

45. Power of judicial authority to referparties to arbitration. Notwithstanding anything contained in Part I or in theCode of Civil Procedure, 1908 (5 of 1908 ), a judicial authority, when seizedof an action in a matter in respect of which the parties have made an agreementreferred to in section 44, shall, at the request of one of the parties or anyperson claiming through or under him, refer the parties to arbitration, unlessit finds that the said agreement is mill and void, inoperative or incapable ofbring performed.

46. When foreign award binding. Anyforeign award which would be enforceable under this Chapter shall be treated asbinding for all purposes on the persons as between whom it was made, and mayaccordingly be relied on by any of those persons by way of defence, set off orotherwise in any legal proceedings in India and any references in this Chapterto enforcing a foreign award shall be construed as including references tofiling on an award.

47. Evidence.

(1) The party applying for theenforcement of a foreign award shall, at the time of the application, producebefore the court- (a) the original award or a copy thereof, duly authenticatedin the manner required by the law of the country in which it was made;

(b) the original agreement forarbitration or a duly certified thereof; and

(c) such evidence as may he necessary toprove that the award is a foreign award. (2) If the award or agreement to beproduced under sub- section (1) is in a foreign language, the party seeking toenforce the award shall produce a translation into English certified as correctby a diplomatic or consular agent of the country to which that party belongs orcertified as correct in such other manner as may be sufficient according to thelaw in force in India. Explanation.- In this section and all the followingsections of this Chapter,' Court' means the principal Civil Court oforiginal jurisdiction in a district, and includes the High Court in exercise ofits ordinary original civil jurisdiction, having jurisdiction over the subject-matter of the award if the same had been the subject- matter of a suit, butdoes not include any civil court of a grade inferior to such principal CivilCourt, or any Court of Small Causes.

48. Conditions for enforcement of foreignawards.

(1) Enforcement of a foreign award may berefused, at the request of the party against whom it is invoked, only if thatparty furnishes to the court proof that-

(a) the parties to tic agreement referredto in section 44 were, under the law applicable to them, under some incapacity.or the said agreement is not valid under the law to which the parties havesubjected it or, failing any indication thereon, under the law of the countrywhere the award was made; or

(b) the party against whom the award isinvoked was not given proper notice of the appointment of the arbitrator or ofthe arbitral proceedings or was otherwise unable to present his case; or

(c) the award deals with a difference notcontemplated by or not failing within the terms of the submission toarbitration, or it contains decisions on matters beyond the scope of thesubmission to arbitration: Provided that, if the decisions on matter submittedto arbitration can be separated from those not so submitted, that pail of theaward which contains decisions on matters submitted to arbitration may beenforced; or

(d) the composition of the arbitralauthority or the arbitral procedure was not in accordance with the agreement ofthe parties, or, failing such agreement, was not in accordance with the law ofthe country where the arbitration took place; or

(e) the award has not yet become bindingon the parties, or has been set aside or suspended by a competent authority ofthe country in which. or under the law of which, that award was made.

(2) Enforcement of an arbitral award mayalso be refused if the Court finds that-

(a) the subject- matter of the differenceis not capable of settlement by arbitration under the law of India; or

(b) the enforcement of the award would becontrary to the public policy of India.

Explanation.- Without prejudice to the generalityof clause (b), it is hereby declared, for the avoidance of any doubt, that anaward is in conflict with the public policy of India if the making of the awardwas induced or affected by fraud or corruption.

(3) If an application for the settingaside or suspension of the award has been made to a competent authorityreferred to in clause (e) of sub- section (1) the Court may, if it considers itproper, adjourn the decision on the enforcement of the award and may also, on theapplication of the party claiming enforcement of the award, order the otherparty to give suitable security.

49. Enforcement of foreign awards. Wherethe Court is satisfied that the foreign award is enforceable under thisChapter, the award shall be deemed to be a decree of that Court.

50. Appealable orders.

(1) An appeal shall lie from the orderrefusing to-

(a) refer the parties to arbitrationunder section 45;

(b) enforce a foreign award under section48, to the court authorised by law to hear appeals from such order.

(2) No second appeal shall lie from anorder passed in appeal under this section, but nothing in this section shallaffect or take away any right to appeal to the Supreme Court.

51. Saving. Nothing in this Chapter shallprejudice any rights which any person would have had of enforcing in India ofany award or of availing himself in India of any award if this Chapter had notbeen enacted.

52. Chapter II not to apply. Chapter IIof this Part shall not apply in relation to foreign awards to which thisChapter applies. CHAP Geneva Convention Awards CHAPTER II Geneva ConventionAwards

53. Interpretation. In this Chapter'foreign award' means an arbitral award on differences relating to mattersconsidered as commercial under the law in force in India made after the 28thday of July, 1924 ,-

(a) in pursuance of an agreement forarbitration to which the Protocol set forth in the Second Schedule applies, and

(b) between persons of whom one issubject to the jurisdiction of some one of such Powers as the CentralGovernment, being satisfied that reciprocal provisions have been made, may, bynotification in the Official Gazette, declare to be panics to the Conventionset forth in the Third Schedule, and of whom the other is subject to thejurisdiction of some other of the Powers aforesaid, and

(c) in one of such territories as theCentral Government, being satisfied that reciprocal provisions have been made,may, by like notification, declare to be territories to which the saidConvention applies, and for the purposes of this Chapter an award shall not bedeemed to be final if any proceedings for the purpose of contesting thevalidity of the award are pending in the

country in which it was made.

54. Power of judicial authority to referparties to arbitration. Notwithstanding anything contained in Part I or in theCode of Civil Procedure, 1908 (5 of 1908 ), a judicial authority, on beingseized of a dispute regarding a contract made between persons to whom section53 applies and including an arbitration agreement, whether referring to presentor future differences, which is valid under that section and capable of beingcarried into effect, shall refer the parties on the application of either ofthem or any person claiming through or under him to the decision of thearbitrators and such reference shall not prejudice the competence of thejudicial authority in case the agreement or the arbitration cannot proceed orbecomes inoperative.

55. Foreign awards when binding. Anyforeign award which would be enforceable under this Chapter shall be treated asbinding for all purposes on the persons as between whom it was made, and mayaccordingly be relied on by any of those persons by way of defence, set off orotherwise in any legal proceedings in India and any references in this Chapterto enforcing a foreign award shall be construed as including references torelying on an award.

56. Evidence.

(1) The party applying for theenforcement of a foreign award shall, at the time of application produce beforethe Court-

(a) the original award or a copy thereofduly authenticated. in the manner required by the law of the country in whichit was made;

(b) evidence proving that the award hasbecome final; and

(c) such evidence as may be necessary toprove that the conditions mentioned in clauses (a) and (c) of sub- section (1)of section 57 are satisfied.

(2) Where any document requiring to beproduced under sub- section (1) is in a foreign language, the party seeking toenforce the award shall produce a translation into English certified as correctby a diplomatic or consular agent of the country to which that party belongs orcertified as correct in such other manner as may be sufficient according to thelaw in force in India. Explanation.- In this section and all the followingsections of this Chapter,' Court' means the principal Civil Court oforiginal jurisdiction in a district, and includes the High Court in exercise ofits ordinary original civil jurisdiction, having jurisdiction over the subject-matter of the award if the same had been the subject- matter of a suit, butdoes not include any civil court of a grade inferior to such principal CivilCourt, or any Court of Small Causes.

57. Conditions for enforcement of foreignawards.

(1) In order that a foreign award may beenforceable under this Chapter, it shall be necessary that--

(a) the award has been made in pursuanceof a submission to arbitration which is valid under the law applicable thereto;

(b) the subject- matter of the award iscapable of settlement by arbitration under the law of India;

(c) the award has been made by thearbitral tribunal provided for in the submission to arbitration or constitutedin the manner agreed upon by the parties and in conformity with the lawgoverning the arbitration procedure;

(d) the award has become final in thecountry in which it has been made, in the sense that it will not be consideredas such if it is open to opposition or appeal or

if it is proved that any proceedings for thepurpose of contesting the validity of the award are pending;

(e) the enforcement of the award is notcontrary to the public policy or the law of India. Explanation.- Withoutprejudice to the generality of clause (e), it is hereby declared, for theavoidance of any doubt, that an award is in conflict with the public policy ofIndia if the making of the award was induced or affected by fraud orcorruption.

(2) Even if the conditions laid down insub- section (1) are fulfilled, enforcement of the award shall be refused ifthe Court is satisfied that-

(a) the award has been annulled in thecountry in which it was made;

Arbitration And Conciliation Act India

(b) the party against whom it is soughtto use the award was not given notice of the arbitration proceedings insufficient time to enable him to present his case; or that, being under a legalincapacity, he was not properly represented;

(c) the award does not deal with thedifferences contemplated by or falling within the terms of the submission toarbitration or that it contains decisions on matters beyond the scope of thesubmission to arbitration: Provided that if the award has not covered all thedifferences submitted to the arbitral tribunal, the Court may, if it thinksfit, postpone such enforcement or grant it subject to such guarantee as theCourt may decide.

(3) If the party against whom the awardhas been made proves that under the law governing the arbitration procedurethere is a ground, other than the grounds referred to in clauses (a) and (c) ofsub- section (1) and clauses (b) and (c) of sub- section (2) entitling him tocontest the validity of the award, the Court may, if it thinks fit, eitherrefuse enforcement of the award or adjourn the consideration thereof, givingsuch party a reasonable time within which to have the award annulled by thecompetent tribunal.

58. Enforcement of foreign awards. Wherethe Court is satisfied that the foreign award is enforceable under thisChapter, the award shall be deemed to be a decree of the Court.

59. Appealable orders.

(1) An appeal shall lie from the orderrefusing-

(a) to refer the parties to arbitrationunder section 54; and

(b) to enforce a foreign award undersection 57, to the court authorised by law to hear appeals from such order.

(2) No second appeal shall lie from anorder passed in appeal under this section, but nothing in this section shallaffect or take away any right to appeal to the Supreme Court.

60. Saving. Nothing in this Chapter shallprejudice any rights which any person would have had of enforcing in India ofany award or of availing himself in India of any award if this Chapter had notbeen enacted.

PART CONCILIATION PART III CONCILIATION

61. Application and scope.

(1) Save as otherwise provided by any lawfor the time being in force and unless the parties have otherwise agreed, thisPart shall apply to conciliation of disputes arising out of legal relationship,whether contractual or not and to all proceedings relating thereto.

(2) This Part shall not apply where byvirtue of any law for the time being in force certain disputes may not besubmitted to conciliation.

62. Commencement of conciliationproceedings.

(1) The party initiating conciliationshall send to the other party a written invitation to conciliate under thisPart, briefly identifying the subject of the dispute.

(2) Conciliation proceedings shallcommence when the other party accepts in writing the invitation to conciliate.

(3) If the other party rejects theinvitation, there will be no conciliation proceedings.

(4) If the party initiating conciliationdoes not receive a reply within thirty days from the date on which he sends theinvitation, or within such other period of time as specified in the invitation,he may elect to treat this as a rejection of the invitation to conciliate andif he so elects, he shall inform in writing the other party accordingly.

63. Number of conciliators.

(1) There shall be one conciliator unlessthe parties agree that there shall be two or three conciliators.

(2) Where there is more than oneconciliator, they ought, as a general rule, to act jointly.

64. Appointment of conciliators.

(1) subject to sub- section (2),-

(a) in conciliation proceedings with oneconciliator, the parties may agree on the name of a sole conciliator;

(b) in conciliation proceedings with twoconciliators, each party may appoint one conciliator;

(c) in conciliation proceedings withthree conciliators, each party may appoint one conciliator and the parties mayagree on the name of the third conciliator who shall act as the presidingconciliator.

(2) Parties may enlist the assistance ofa suitable institution or person in connection with the appointment ofconciliators, and in particular,-

(a) a party may respect such aninstitution or person to recommend the names of suitable individuals to act asconciliator, or

(b) the parties may agree that theappointment of one or mom conciliators be made directly by such an institutionor person: Provided that in recommending or appointing individuals to act asconciliator, the institution or person shall have regard to such considerationsas are likely to secure the appointment of an independent and impartialconciliator and, with respect to a sole or third conciliator, shall take intoaccount the advisability of appointing a conciliator of a nationality otherthan the nationalities of the parties.

65. Submission of statements to conciliator.

(1) The conciliator, upon hisappointment, may request each party to submit to him a brief written statementdescribing the general nature of the dispute and the points at issue. Each partyshall send a copy of such statement to the other party.

(2) The conciliator may request eachparty to submit to him a further written statement of his position mid thefacts and grounds in support thereof, supplemented by any documents and otherevidence that such puny deems appropriate. The party shall send a copy of suchstatement, documents and other evidence to the other party.

(3) At any stage of the conciliationproceedings, the conciliator may request a party to submit to him suchadditional information as he deems appropriate. Explanation.- In this sectionand all the following sections of this Part, the term conciliator' appliesto a sole conciliator, two or, three conciliators, as the case may be.

66. Conciliator not bound by certainenactments. The conciliator is not bound by the Code of Civil Procedure, 1908(5 of 1908 ) or the Indian Evidence Act, 1872 . (1 of 1872 ).

67. Role of conciliator.

(1) The conciliator shall assist theparties in an independent and impartial manner in their attempt to reach anamicable settlement of their dispute.

(2) The conciliator shall be guided byprinciples of objectivity, fairness and justice, giving consideration to, amongother things, the rights and obligations of the parties, the usages of thetrade concerned and the circumstances surrounding the dispute, including anyprevious business practices between the parties.

(3) The conciliator may conduct theconciliation proceedings in such a manner as he considers appropriate, takinginto account the circumstances of the case, the wishes the parties may express,including any request by a party that the conciliator hear oral statements, andthe need for a speedy settlement of the dispute.

(4) The conciliator may, at any stage ofthe conciliation proceedings, make proposals for a settlement of the dispute.Such proposals need not be in writing and need not be accompanied by astatement of the masons therefor.

68. Administrative assistance. In orderto facilitate the conduct of the conciliation proceedings, the parties, or theconciliator with the consent of the parties, may arrange for administrativeassistance by a suitable institution or person.

69. Communication between conciliator andparties:

(1) The conciliator may invite theparties to meet him or may communicate with them orally or in writing. He maymeet or communicate with the parties together or with each of them separately.

(2) Unless the parties have agreed uponthe place where meetings with the conciliator are to be held, such place shallbe determined by the conciliator, after consultation with the parties, havingregard to the circumstances of the conciliation proceedings.

70. Disclosure of information. When theconciliator receives factual information concerning the dispute from a party,he shall disclose the substance of that information to the other party in orderthat the other party may have the opportunity to present any explanation whichhe considers appropriate: Provided that when a party gives any information tothe conciliator, subject to a specific condition that it be kept confidential,the conciliator shall not disclose that

information to the other party.

71. Co- operation of parties withconciliator. The parties shall in good faith co- operate with the conciliatorand, in particular, shall endeavour to comply with requests by the conciliatorto submit written materials, provide evidence and attend meetings.

72. Suggestions by parties for settlementof dispute. Each party may, on his own initiative or at the invitation of theconciliator, submit to the conciliator suggestions for the settlement of thedispute.

73. Settlement agreement.

(1) When it appears to the conciliatorthat there exist elements of a settlement which may be acceptable to theparties, he shall formulate the terms of a possible settlement and submit themto the parties for their observations. After receiving the observations of theparties, the conciliator may reformulate the terms of a possible settlement inthe light of such observations.

(2) If the parties reach agreement on asettlement of the dispute, they may draw up and sign a written settlementagreement. If requested by the parties, the conciliator may draw up, or assistthe parties in drawing up, the settlement agreement.

(3) When the parties sign the settlementagreement, it shall be, final and binding on the parties and persons claimingunder them respectively.

(4) The conciliator shall authenticatethe settlement agreement and furnish a copy thereof to each of the parties.

74. Status and effect of settlementagreement. The settlement agreement shall have the same status and effect as ifit is an arbitral award on agreed terms on the substance of the disputerendered by an arbitral tribunal under section 30.

75. Confidentiality. Notwithstandinganything contained in any other law for the time bring in force, theconciliator and the parties shall keep confidential all matters relating to theconciliation proceedings. Confidentiality shall extend also to the settlementagreement, except where its disclosure is necessary for purposes ofimplementation and enforcement.

76. Termination of conciliationproceedings. The conciliation proceedings shall be terminated-

(a) by the signing of the settlementagreement by the parties, on the date of the agreement; or

(b) by a written declaration of theconciliator, after consultation with the parties, to the effect that furtherefforts at conciliation are no longer justified, on the date of thedeclaration; or

(c) by a written declaration of theparties addressed to the conciliator to the effect that the conciliationproceedings are terminated, on the date of the declaration; or

(d) by a written declaration of a partyto the other party and the conciliator, if appointed, to the effect that theconciliation proceedings am terminated, on the date of the declaration.

77. Resort to arbitral or judicialproceedings. The parties shall not initiate, during the conciliationproceedings, any arbitral or judicial proceedings in respect of a dispute thatis the subject- matter of the conciliation proceedings except that a party mayinitiate arbitral or judicial proceedings where, in his opinion, suchproceedings are necessary for preserving his rights.

78. Costs.

(1) Upon termination of the conciliationproceedings, the conciliator shalt fix the costs of the conciliation and givewritten notice thereof to the parties.

(2) For the purpose of sub- section(1),' costs' means reasonable costs relating to-

(a) the fee and expenses of theconciliator and witnesses requested by the conciliator, with the consent of theparties;

(b) any expert advice requested by theconciliator with the consent of the parties;

(c) any assistance provided pursuant toclause (b) of sub- section (2) of section 64 and section 68;

(d) any other expenses incurred inconnection with the conciliation proceedings and the settlement agreement.

(3) The costs shall be borne equally bythe parties unless the settlement agreement provides for a differentapportionment. All other expenses incurred by a party shall be borne by thatparty.

79. Deposits. The conciliator may directeach party to deposit an equal amount as an advance for the costs referred toin sub- section (2) of section 78 which he expects will be incurred.

(2) During the course of the conciliationproceedings, the conciliator may direct supplementary deposits in an equalamount from each party.

(3) If the required deposits under sub- sections(1) and (2) are not paid in HI by both parties within thirty days, theconciliator may suspend the proceedings or may make a written declaration oftermination of the proceedings to the parties, effective on the date of thatdeclaration.

(4) Upon termination of the conciliationproceedings, the conciliator shall render an accounting to the parties of thedeposits received and shall return any unexpended balance to the parties.

80. Role of conciliator in otherproceedings. Unless otherwise agreed by the parties,-

(a) the conciliator shall not act as anarbitrator or as a representative or counsel of a party in any arbitral orjudicial proceeding in respect of a dispute that is the subject of theconciliation proceedings;

(b) the conciliator shall not bepresented by the panics as a witness in any arbitral or judicial proceedings.

81. Admissibility of evidence in otherproceedings. The parties shall not rely on or introduce as evidence in arbitralor judicial proceedings, whether or not such proceedings relate to the disputethat is the subject of the conciliation proceedings,-

(a) views expressed or suggestions madeby the other party in respect of a possible settlement of the dispute;

(b) admissions made by the other party inthe course-, of the conciliation proceedings;

(c) proposals made by the conciliator;

(d) the fact that the other party hadindicated his willingness to accept a proposal for settlement made by theconciliator. PART SUPPLEMENTARY PROVISIONS PART IV SUPPLEMENTARY PROVISIONS

82. Power of High Court to make rules.The High Court may make rules consistent with this Act as to all proceedingsbefore the Court under this Act.

83. Removal of difficulties.

(1) If any difficulty arises in givingeffect to the provisions of this Act, the Central Government may, by orderpublished in the Official Gazette, make such provisions, not inconsistent withthe provisions of this Act as appear to it to be necessary or expedient forremoving the difficulty: Provided that no such order shall be made after theexpiry of a period of two years from the date of commencement of this Act.

(2) Every order made under this sectionshall, as soon as may be after it is made, be laid before each House ofParliament.

84. Power to make rules.

(1) The Central Government may, bynotification in the Official Gazette, make rules for carrying out theprovisions of this Act.

(2) Every rule made by the CentralGovernment under this Act shall be laid, as soon as may be, after it is madebefore each House of Parliament while it is in session, for a total period ofthirty days which may be comprised in one session or in two or mote successivesessions, and if, before the expiry of the session immediately following thesession or the successive sessions aforesaid, both Houses agree in making anymodification in the rule or both Houses agree that the rule should not be made,the rule shall thereafter have effect only in such modified form or be of noeffect, as the case may be; so, however, that any such modification orannulment shall be without prejudice to the validity of anything previouslydone under that rule.

85. Repeal and savings.

(1) The Arbitration (Protocol andConvention) Act, 1937 (6 of 1937 ), the Arbitration Act, 1940 (10 of 1940 ).and the Foreign Awards (Recognition and Enforcement) Act, 1961 (30 45 of 1961). are hereby repealed.

Arbitration And Conciliation Act 2015

(2) Notwithstanding such repeal,-

(a) the provisions of the said enactmentsshall apply in relation to arbitral proceedings which commenced before this Actcame into force unless otherwise agreed by the parties but this Act shall applyin relation to arbitral proceedings which commenced on or after this Act comesinto force;

(b) all rules made and notificationspublished, under the said enactments shall, to the extent to which they are notrepugnant to this Act, be deemed respectively to have been made or issued underthis Act.

86. Repeal of Ordinance 27 of 1996 andsaving.

(1) The Arbitration and Conciliation(Third) Ordinance, 1996 (Ord 27 of 1996 ). is hereby repealed.

Sec 13 Of Arbitration And Conciliation Act

(2) Notwithstanding such repeal, anyorder, rule, notification or scheme made or anything done or any action takenin pursuance of any provision of the said Ordinance shall be deemed to havebeen made, done or taken under the corresponding provisions of this Act.