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CONCEPT OF ARBITRATION


Arbitration is one of the type alternative dispute resolution whereby parties with the written refers the matter to be solved by an arbitrator. It is governed by The Arbitration and Conciliation Act, 1996. Clause (a) of section 2, defines the term arbitration. To solve the matter under arbitration, there must be an arbitration agreement. Essentials of arbitration agreement.

  1. It must be in written.

  2. There must be an intention to show that the parties want to refer the matter to arbitration

  3. The agreement may be in a form of separate agreement or in a form of arbitration clause.

  4. It shall contain all the all, or certain disputes which shall be referred to arbitration.

  5. It must be singed by the parties.

Where there is an arbitration agreement and initially it has been referred to the court related to the subject-matter is which also the subject-matter in the arbitration, then the party to the agreement applies to the court before the date of submission of his first statement on the substance for arbitration provided the court is satisfied that prima facie there is a valid arbitration agreement.

An application shall accompany by the original arbitration agreement or duly certified copy.

Appointment

  1. The arbitration proceeding shall be decided by the parties itself.

  2. In an arbitration where there are three arbitrators, each party chooses one arbitrator , and then those arbitrator chooses the third arbitrator which act as presiding officer.

  3. In case where the arbitrator is not appointed by the parties within thirty days from the date of request to do so, or where the arbitrator fails choose the presiding arbitrator within thirty days, than on the request of parties the appointment shall be made by either High Court or Supreme Court or any person or institute authorize on behalf of them.

  4. Where the parties fail to appoint an arbitrator in the case of sole arbitrator within thirty days from the date of request made by one party, on the request of the party same shall be appointed by Supreme Court or High Court.

  5. Where under the appointment procedure, parties fail to act as the per the procedure decide or parties or arbitrator fails to the reach to the agreement as required by the procedure or where the person or institute fails to act as per the procedure, then on the request of the parties, the Supreme Court or High Court are required to take necessary steps.


Arbitration proceeding


  1. The arbitration tribunal shall make the rules on its own jurisdiction and to determine whether there exists a valid arbitration agreement.

  2. The objection related to the jurisdiction shall be raised before the submission of the statement of defense.

  3. The objection raised by the parties related to exceed the scope of its authority shall be made immediately as the court exceed such authority.

  4. Where the tribunal rejects the plea and makes an award the same can be set aside under section 36 of the Act.

  5. In case of any delay, it party shall satisfy the court there was reasonable delay.

Conduct of the proceeding

  1. The parties are free to agree upon the conduct of the tribunal.

  2. The tribunal is not bound by the CPC.

  3. The place of arbitration shall be decided by the parties, in case of absence of such agreement such shall be decided by the tribunal considering the circumstances of the case.

  4. Within the mutually agreed times, by the parties or as decided by tribunal the claimant shall state his contention and remedy or relief and defendant shall state its defense in respect of those contentions. Parties may submit document to support their claims and defense or counterclaim.

The award laid down by the arbitrator shall be final , and binding upon both the parties. And aggrieved party can apply to set aside the award.


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