Arbitration and Conciliation Act 1996

Here is a brief overview of the Arbitration Act with a simple and easy to understand language. Very useful for beginners who are finding difficulty in learning alternative methods of dispute resolution.

1. Made BY Sahil Garg

2. ORIGIN
The origin of arbitration may be traced back to
the age old system of village panchayats
prevalent in ancient india.
Decision of panchas taken as they are
embodiment of voice of God, hence accepted
and obeyed unquestionably.
In course of time this divine dispensation of
justice underwent radical changes with
changing pattern of society and growth.

3. Definition
SECTION 2(1)(a) arbitration means any
arbitration whether or not administered by
permanent arbitral institution.
It is a process of dispute resolution between
parties through arbitral tribunal appointed by
parties to the dispute or by the court at the
request of a party.
Precisely it is an alternative to litigation as a
method of dispute resolution.

4. TYPES
1. Ad hoc Arbitration- where the procedure(apt
arbitrator) is either agreed upon by the parties or in
the absence of an agreement the same is laid down
by arbitral tribunal.
2. Institutional Arbitration- in case of disputes
arising b/w parties, they will be referred to
particular inst. such as ICA, ICC, WIPO etc.
3. Contractual Arbitration- when the parties to a
contract inserts arbitration clause in their contract
for referring future disputes to decided arbitrators.
4. Statutory Arbitration- cases where arbitration is
statutorily imposed on the parties by law of land.

5. ARBITRATION AGREEMENT
It is defined under section 7 of the Arbitration
And Conciliation Act,1996
It means an agreement by the parties to submit
to arbitrator all or certain disputes which have
arisen or which may arise between them in
respect of defined legal relationship.
It may be in the form of an arbitration clause in
a contract or in a separate agreement.
It shall be in writing and in form of signed
document, exchange of letters, telex, telegrams
or other means of telecommunication.

6. BIHAR STATE MINERAL DEVELOPMENT CORP.
V.
ENCON BUILDERS (P) LTD
(AIR 2003 SC3688)
In this case The Supreme Court of India held that
the essential elements of an arbitration agreement
are:-
There must be present or a future dispute in
connection with some contemplated affairs.
Intention of the parties to settle such dispute
Parties must agree to be bound by decision of such
tribunal.
Parties must be ad idem (consensus between the
parties)

7. ARBITRAL AWARD
Under Section 2(1)(c) of Arbitration and Conciliation
Act,1996 arbitral award includes an interim award.
An arbitral award is a judgment pronounced by an
arbitral tribunal on disputes or differences referred to it
for arbitration.
Section 35 of Act states that an arbitral award shall be
final and binding on the parties and persons claiming
under them.
Types of awards
1. Final Award- when the arbitration proceedings stand
terminated and award made is binding on the parties.
2. Interim Award- as a protective measure an arbitral
tribunal may make an interim order in respect of the
subject matter of the dispute. Such an award is effective
on during the proceedings

8. Arbitral Tribunal
According to Section 2(1)(d) of Act arbitral tribunal
means a sole arbitrator or a panel of arbitrators.
It is left to the parties to determine number of
arbitrators for setting their dispute or difference, the
only limitation being that an even number of
arbitrators shall not be appointed [Section
10(1)] .
In case the parties do not determine the number of
arbitrators the arbitral tribunal shall consist of a
sole arbitrator. [Section 10(2)]
The arbitrator may be of any nationality and the
parties are at liberty to agree on the procedure for
appointing arbitrator.

9. Thank You

10. Thank You