 We are all glad on behalf of Beyond Law CLC that Justice Ramesh Danuka had joined who is a former Chief Justice of Bombay High Court. And those who have been connected with Beyond Law CLC series would know that we had shared one session with Justice Ramesh Danuka and the second part was done by Mr. Roshan Balvi. Those sessions were so well received that we kept on receiving the messages. But as they say that with the flux of time Justice Ramesh Danuka on the administrative side and otherwise also agree after the session being taken on Beyond Law CLC. By the end he had been the firstly acting Chief Justice and then the former Chief Justice. So we are glad that he is back on our platform for sharing his knowledge. They have also seen that he has shared his takes on the arbitration act. Those notes have been popularly circulated amongst all the WhatsApp groups and even on the LinkedIn. Those who have missed it we can share those notes with you and we are always indebted to Justice Ramesh Danuka on this respect. And we thought why not have an overview of arbitration and cancellation act since the topic is quite extensive and when we have a speaker like Mr. Danuka. Then we know that we shouldn't ask him to speak to the side. So the best way forward is to divide those particular charts insights into parts. So we will be having the part one today. That is the overview of arbitration and cancellation act 1996 part one. Before we request Justice Danuka we can all say that his third journey after the advocate then as a judge and back into consultancy and arbitration may bring laurels more to him in his personal and professional life coupled with the fact that we keep on learning from him what he shares with his insightful sessions. What do you do? Thank you. Thank you Vikas for giving this opportunity again in my third inning. To share my experience on some important provisions of arbitration act. The first and foremost requirement for referring the dispute to arbitration is that there has to be a dispute between the parties. And there has to be an arbitration agreement. So dispute starts from the issue whether there is a dispute or not. One view may be that if there is no denial, whether it will amount to dispute, whether there is silence, whether it will amount to dispute where there is promise to pay and not paying whether this will amount to dispute. So the view taken by Supreme Court as well as Bombay High Court, particularly on this issue is that if there is a demand and even if there is a silence, no denial, no commitment, no promise, still cause of excess starts, dispute starts. In one of the interesting matter, issue arose where respondent did not dispute the liability, but this dispute was only this that I don't have money, how do I pay? So question arose that if it is not disputing, where is the dispute? How can you refer it to arbitration? So Bombay High Court took a view that even if there is admission of liability, but it's not paying it, there is a dispute and then we refer to arbitration. So this is the first aspect. Second aspect is there has to be an arbitration agreement. As you also say one provides agreement is in writing, if it is part of the main agreement or it may be by separate correspondence, maybe by telex, maybe by telegram, maybe by email, which is included by 2015 amendment. And if there is agreement, then matter can be referred, one or two more aspects of agreement under section 7R, that it can be asserted in the statement of claim and not denied in the written statement, even that will amount to existence of arbitration agreement. And if arbitration agreement is decoded somewhere else and there is a reference to that document in the main document and parties intended that the arbitration agreement should be recorded as part of the main agreement, then by applying doctrine of incorporation, even the arbitration agreement reporting some other document would form part of arbitration agreement under section 7, 5. Now again, some dispute arises about existence of arbitration agreement, about mandatory conditions to be fulfilled before invocation of arbitration. I will just refer to two or three such illustrations. If agreement provides for appointment of an arbitrator exclusively by one party, our waste with him, in that situation what happens, whether that party alone can appoint an arbitrator, we will find some such clauses in the agreement basically entered into by finance companies, or by railways, or by state government, sometimes by central government where power to appoint waste only with one party and not both the parties. So in Perkins case, Supreme Court ultimately took a view that no, this can't be permitted, because if this power is given to one party only to appoint an arbitrator, that party may have some interest in the outcome of the orbital proceedings. Therefore, he alone can't be allowed to appoint an arbitrator. Independent arbitrator has to be appointed who does not fall under any of the disqualification under the schedule, but you now consistently taken after Perkins case, where Supreme Court has taken a view that independent arbitrator has to be appointed. Second thing what has to be seen in an arbitration agreement is whether there are any conditions prescribed before invocation of arbitration agreement. You may find a clause where clause may say that you have to notify your claims before project manager or some engineer in case of construction contract, or there may be a clause that there has to be sincere attempts to be made by both parties for settlement by negotiation. And if that is not done, question is whether you can straight away invoke arbitration agreement or if you invoke straight away arbitration agreement whether it would be premature. So that has to be seen if mandatory conditions are required to be followed if not followed and if you file section 11 petition directly. There may be derailment by court saying that your petition is premature, first you follow the mandatory condition and then come back. Just for a minute, we would like to welcome Justice Indra Venerjee. We are too glad that she has joined us. Ma'am, you will have to plug in your audio because somehow you are not plugged in your video but I on behalf of Justice Dhanuka, Beyond Law CLC, we are obliged that you have joined our platform. I am also grateful to her ladies, I can share from on the screen. So this will also give me some encouragement to share my experience with all of you. I had a good time with her ladies. Yesterday only we read that she is joining as a in Benetton College. So we are too glad. Thank you. Thank you for that. Once mandatory conditions are followed which are required to be followed before invocation of arbitration agreement that has to be seen. Of course, at some stage there may be an issue of waiver that if those mandatory conditions are derogable or some part of is derogable and part is proceed with the arbitration without raising any objection, then that will amount to waiver or not. I will come to that little later. So section 7, you have to say how many arbitrators are prescribed in the agreement if there is provision for 3, then only by consent one can be appointed even court can't upon sole arbitration agreement provides for 3. What we will have to record fresh agreement of the parties in 19. Then you have to see whether any time is prescribed for giving notice for invocation of arbitration agreement. If no time is prescribed then 30 days notice has to be given and if within 30 days arbitrator is not appointed then you can invoke section 116 in case of domestic arbitration and section 119 in case of international commercial arbitration. You have to give few names to the other side if there is a provision for appointment of sole arbitrator. If agreement is silent then under section 10 there has to be sole arbitration. So you have to suggest few names. Other side may agree to those names or other side may suggest few other names. If there is any common name parties can appoint such arbitrator whose name is common in both the list. If they don't agree normally people don't agree to the name suggested by the other side. In that situation you have to go to court under section 116 and then court will appoint an independent arbitrator. Of course taking into consideration the qualification if any prescribed in the arbitration agreement. At that stage under section 11 there are various issues which I must deal with at this stage. One issue is that suppose there is a dispute about existence of arbitration agreement. Then court hearing section 11 application itself has to decide that issue whether arbitration agreement exist or not. If court takes a view that arbitration agreement exist then you have to go to arbitration. That order of course can be challenged under article 136 of Constitution of India. There is no red petition maintainable against the order passed by the court under section 116. There may be also an issue about existence of arbitrability. There the court has taken a view that if there is serious issue of arbitrability then instead of court deciding that it can be referred to the arbitrator. Arbitrator will be competent to decide the issue of arbitrability. Then there was a serious issue raised about stamping which fortunately that issue is now decided by seven judges bench in NN Global 2. Earlier the view taken by two three judges bench. One bench took a view that the document is not sufficiently stamped or not not at all no required. In that event even arbitrator cannot be appointed in such a situation. Then five judges took the same view three versus two and ultimately in a curative petition supreme court in the in seven judges bench took a view that now though arbitration agreement which may fall from part of the main agreement if the main agreement which requires stamp is not stamped that agreement as a whole would be illegal inadmissible in law. But court cannot refuse to appoint an arbitrator on that ground. Ultimately it is a fiscal legislation and arbitrator can decide that issue whether the document would be required to be stamped or not and if required to be stamped then he can impound the document and the document can be sent to the registering authority stamping authority for adjudication. If application for appointment of arbitrator is rejected by section 11 court then that order can be again challenged under article 136 of constitutional media. If arbitrator is appointed then you have to go before the arbitrator. Arbitator will give directions to file pleadings under section 24. Now because of the 2015 amendment when pleadings have to be between six months from the date of prior to 2015 amendment there was no time prescribed for filing pleadings. There was no time prescribed for making an award. As a result of 23rd October 2015 amendment now six months time is prescribed. This is again a matter of debate that if proceedings if pleadings are not filed within six months then what happens? Whether there is power to grant extension beyond the period of six months or if pleadings are not completed if statement of claim itself is not filed in that even it is mandatory for an arbitral tribunal to terminate the proceedings. So what is the meaning of how to construct the word shell in section 24? My personal opinion as a student of law in response to one of the query raised in one of the lecture is that since first of all the wording uses shell and secondly 12 months period granted to the arbitral tribunal to make an award would commence after filing of pleadings. If pleadings are filed suppose before expiry of six months your 12 months will start from that date and if within file within six months then of course 12 months will start from the date of filing pleadings. Therefore the word shell has to be construed in view of the fact that arbitrators time to make an award would commence only after pleadings are filed and of course if pleadings are not filed according to me within six months then consequence will follow. If statement of claim is not filed proceedings can be terminated if statement of defense is not filed then of course arbitral tribunal can proceed with the pleadings and documents on record section or order 8 rule 5 situation will not apply in that situation that whatever is claimed is deemed to have been admitted that is fortunately taken care of in section 24. If pleadings are filed within the time of course now even counter claim can be filed by the respondents provided it is within the parameters of the arbitration agreement entered into between the parties. If counter claim is filed then time is also time is granted to the claimant to file statement of defense to the counter claim. Once counter claim is filed then there will be further directions issued by the arbitral tribunal for admission of documents statement of admission and denial is required to be filed then there has to be marking at this stage I must tell you that though section 19 clearly says that arbitral tribunal is not bound by the provisions of evidence act and CPC but the view taken consistently by the supreme court and high court is that arbitral arbitrator is bound to follow the principles of natural justice. Now it happens sometimes that under the guise of following principles of natural justice principles of evidence that CPC are extended to the arbitral proceedings that is one of the view taken by the court consistently I am also bound by those judgments so once pleadings are completed issues are required to be framed issues are framed then question of filing oral evidence because now the number of judgments of supreme court having taken consistent view that if crucial and material part of evidence is not considered then that may perhaps amount to patent illegality. As you all know three days back supreme court has interfered with an order passed by two bench judges in case of Delhi metro rail corporation in a curative petition and the reasonings I have recorded I have read in the judgment delivered by three judge bench then because crucial piece of evidence was not considered and evidence reasons were not properly recorded these were the two main grounds while setting aside the judgment of two judges bench of supreme court in that judgment in a curative petition it is again matter of debate whether one final judgment of two judges could have been set aside in a curative petition or not that I don't know some day some debate will be there on this issue as a student of law I try to read as many judgments as possible to make myself aware which I am sharing with you now you can raise an issue of jurisdiction before the arbitral tribunal under section 16 not later than filing first statement on substance of dispute suppose you have issue of arbitrability or you have claim you have plea of limitation you are raising before the arbitral tribunal or in case where arbitral tribunal is appointed without intervention of court in that event you have no opportunity to raise an issue of existence of arbitration agreement and under section 16 if arbitration is appointed without intervention of court in that event issue under 16 can be raised about even existence of arbitration agreement so there is two or three fold objections which can be raised under section 16 if that issue is raised then arbitral tribunal is bound to decide one way or the other if arbitral tribunal takes a view that tribunal has jurisdiction in that event there is no remedy against that order till final award is rendered by the arbitral tribunal and that order can be challenged along with final award under section 34 of the arbitration and cancellation act but if arbitral tribunal accepts the plea of jurisdiction and takes a view that tribunal has no jurisdiction and terminates the proceeding in that event that order is an appealable order under section 37 of the arbitration and cancellation act you may also file an application the respondent may file an application before the arbitral tribunal challenging the arbitral tribunal by filing an application under section 13 within the time prescribed under the arbitration act and once that application is filed that arbitrator would be biased or is is not impartial and there is some prejudice there is some bias on the part of the arbitrator then that application has to be decided by the arbitral tribunal no arbitral tribunal will say that he will be biased he will say that I am not biased he will pass some order there is no remedy against that order at the threshold even that order also can be challenged along with final award if you are agreed by the final award so this is about 12 and 13 section 14 talks about termination of mandate of the arbitral tribunal in certain circumstances there is gross delay is not proceeding with the matter with due diligence there are other grounds under section 14 you make an application before the arbitral tribunal that you please terminate your mandate is not willing to terminate there is a dispute whether mandate is terminated or not in that event you can file a petition under section 14 before the court under section 21e for a declaration that mandate is terminated in one matter interesting matter before Bombay I court where arbitrator was charging exorbitant fees and also he was not proceeding with the matter with due diligence section 14 petition was filed before Bombay I court Bombay I court entered in that petition under section 14 and declared the mandate of the arbitral tribunal terminated a mandate is terminated on such grounds then arbitration agreement does not come to an end you can apply for appointment of substitute arbitrator by invoking the arbitration agreement again and by complying with the conditions of the arbitration agreement under section 15 for appointment of arbitrator another issue which arose in one matter before supreme court that suppose arbitrator is appointed for the first time in some pending civil proceedings under section 89 agreement is recorded for the first time proceedings are disposed of Mr. XYZ is appointed by name and for some reason the arbitrator resigns he refuses to take the matter in that event what happens to the arbitration agreement whether agreement stands terminated or agreement survives in spite of the reclusion on the part of the arbitrator appointed by the court under section 89 of CPC there the view taken by supreme court in the Rewans case which is part of my note where the view taken is that unless there is a bar in the arbitration agreement that only X is appointed and if it doesn't or he dies or he resigns or he recuses or whatever happens there will be no fresh arbitration there will be no arbitration agreement if such bar is there then only arbitration agreement will come to an end otherwise agreement continues you can apply for substitution provided you comply with the other conditions of arbitration agreement then you can apply for interim reliefs under section 17 interim reliefs we also call it as interim measures they are either by making an application before the court under section 9 or similar powers are given to the arbitral time under section 9 first time given section 9 says that before during and after after means before executing the award before means before commencement of arbitral proceedings and during means after appointment of arbitral tribunal and before making an award so under section 43 to be read with section 21 arbitral proceedings commences when you give a notice for appointment of arbitrator in respect of a particular disputes it is there is slight difference between a suit and arbitration on this aspect in suit when you lose your claim when you you lose your plant limitation stops whereas in case of arbitration when you give your notice for appointment of arbitrator in respect of XYZ disputes then arbitral proceedings commences under section 43 to be read with section 21 and whether arbitrator is appointed after two years one month one year six months or a statement of claim is finality later no problem limitation would stop in one of the matter very interesting issue arose when more particularly I must tell you role task limited versus role task limited where there was no separate notice given by the respondent for his counter claims question arose that if there is no notice for notice invoking arbitration agreement for counter claim whether limitation will stop in respect of counter claim or limitation would stop only when such counter claim is lost with the arbitral your limitation period is over you you won't get extension of limitation because claimant had given separate notice for appointment of arbitrator respondent has not given for counter claim the stoppage of limitation or notice of claimant would not be available to the respondent in respect of counter claim. Now this is one important provision section 9 says that if interim relief is granted by court under section 9 and if arbitral tribunal is not appointed arbitral proceedings have not commenced in that event proceedings have to be commenced within three months because sometimes parties take interim orders from court and they don't go to arbitration. Second part of section 9 says that if arbitral tribunal is already appointed it is in place then whether court can enter section 9 petition or not there the the provision is that if finds that remedy of efficacious in that event though arbitral tribunal is in place court can inappropriate matters grant interim measures under section 9 I will share with you one illustration suppose you are seeking appointment of a court receiver the court receiver machinery is not available to an arbitrator because arbitrator is not a court so then you can apply only before court under section 9 or you are seeking some interim measures against a third party suppose you want to invoke a bank guarantee or your goods are lying in custody of a third party we not a party to arbitration agreement in that event because third party you cannot seek any relief under section 17 you can seek under section 9 against a third party for that limited purpose next question is whether third party can apply for any interim measures under section 9 answer is no third party cannot apply but parties to arbitration agreement can apply for interim measures against a third party only for that limited purpose he would be implanted because party against whom you are seeking relief he has to be party otherwise it will be in violation of principles of natural justice then under 17 what you can apply you can ask for the same relief only thing is that the stage there are three stages of applying for interim relief under section 9 those three stages are not available before arbitral tribunal because unless arbitral tribunal is in place there is no question of making an application prior to invocation of arbitration so that stage is not available the only stage available is that during the pendency of arbitration proceedings you can apply before arbitral under section now if the order passed by the arbitral tribunal so you will have to unmute yourself there is some connectivity issue if order passed by arbitrator under section 17 has attained finality in the sense no appeal is preferred or appeal is preferred but dismissed in that event order of arbitral tribunal becomes enforceable as if order of court and that can be enforced under the provisions of cpc similarly order passed by court under section 9 also can be enforced if it has attained finality as if order of court so you don't have to earlier what was happening was that order passed by arbitral tribunal it was required to be enforced separate petition under section 9 was required to be filed but now because of the amendment in 2015 order passed by the tribunal also can be enforced as if order of court then order order 21 and there is various other provisions of cpc would be attracted depending upon the entry orders passed by the arbitral tribunal under section 17 again because of the 7 judges judgment the issue may arise that if court is not required to see whether document is sufficiently stamped or not in that event arbitrator will have to decide that so arbitrator is empowered at what stage he can decide this one view is that as and when the document containing arbitration agreement is standard in evidence whether at that stage it will be applicable or the stage section 11 is now shifted to section 16 that this issue be decided first irrespective of the fact whether the document is tender at the stage of oral evidence so once arbitrator takes a view that no some stamping would be necessary you will impound the document you will send the document for adjudication before the stamping authority and then once it is stamped then he can proceed with the matter under section 19 as I have told you arbitrator is not bound to follow the provisions of evidence act and cpc but principles of natural justice apply if they have not agreed a particular procedure then arbitrator has ample power to decide how to conduct with the arbitral proceedings section 20 talks about place of arbitration but unfortunately because of some judgments as a student of law I am not criticizing any judgment but the concept of seat and venue which are applicable to forum arbitration in case of international commercial arbitration or where foreign award is rendered that concept of part 2 is unfortunately extended to domestic arbitration and then as a result of that there are various inconsistent judgments delivered by our courts one says that if seat of arbitration in domestic arbitration is acts then even cause of action as a reason somewhere else agreement was entered into a third place you have submitted to the jurisdiction of that court where seat of arbitration was there so these are again at some stage I hope this issue also will be sorted out by larger bench to avoid this conflict created by various judgments of our court then section 21 as I told you is very crucial for the purpose of deciding limitation 24 again for filing of statement of claim and return statement and counter claim the matter at this stage I must also deal with the issue waiver statement of claim was not filed two sets of family members they appointed one family friend as an arbitrator they were under impression that he will be the best person to adjudicate upon our dispute because we know he knows both the family members he was not familiar with law he was not familiar with arbitration he was holding meetings with the parties either in presence of each other or separately he would try to find out what is the claim of the claimant what is the claim of the respondent you will communicate that and by doing following this process he made some award and that award was challenged under section 34 before Bombay High Court other side raised an objection that you never raised an issue before the arbitrator under section 16 or under any other provision that there are no pleadings therefore this will amount to waiver now you have merely because you are lost in the orbital proceedings you can't say that statement of claim was not filed therefore how could an award be made Bombay High Court took a view that filing of pleadings is meant because unless you find pleadings or get an opportunity to know what is your case you can you can meet with the case of the other side therefore even if no objection is raised you can't say that this will amount to waiver under section 4 so court entered in that petition and has set aside the award on the ground that mandatory provision which is not derogable was violated and arbitrator also could not understand all this he made an award without any pleadings so award was set aside another issue on waiver which which all of you have to take into consideration that if you don't raise an objection under section 4 to what aspect that certain procedure or conditions prescribed in the arbitration agreement for certain provisions forming part of part 1 you are not raised any objection you are proceeded with and if those provisions are derogable in that even section 4 will not come to your rescue at the later stage but in one judgment in case of loya versus loya the supreme court took a view where instead of odd number of arbitrators two arbitrators were appointed one by claimant one by respondent and two arbitrators made an award and that award was subsequently challenged under section 34 matter went right up to supreme court the argument was that this composition of arbitral triangle of 2 is contrary to section 10 therefore award should be set aside on the ground of illegal composition of arbitrary time supreme court took a view that whether two should be appointed or three should be appointed that objection would to have been raised at the threshold since you are not raised and this part of part one is derogable therefore you cannot be allowed to now raise that issue of waiver at at at this stage under section 34 that is another issue under 4 there are so many judgments I have referred because of shortage of time I will not be able to give more illustrations on section 4 then if statement of claim is not filed then what happens then proceedings have to be terminated if written statement is not filed you have to proceed with the matter and decide the matter merits one way or the other section 26 provides for you know appointment of experts 27 is another important lecture I must share with you where parties are entitled to seek court's assistance in recording evidence because it is quite possible that you are one of the party wants to rely upon certain documents they are in possession of some third party the third part is not cooperating or you want production of some documents or you want production of a witness who is not willing to come to arbitral tribunal on your request in that event you want to make an application before the arbitral tribunal that I want production of XYZ documents or I want production of XYZ witness arbitrator will pass an order of course after application of mine that yes production of documents or production of witness would be necessary for proper adjudication of disputes you will pass an order on the basis of that order the applicant then would file a petition before court for seeking court's assistance the view taken by Bombay court as well as Supreme Court is that court has no power to go into the correctness of the order passed by the tribunal in the proceedings under section 27 there is no adjudication court has to see whether arbitrator was satisfied but in a recent judgment of supreme court it is held that it is not mechanical arbitrator has to at least apply his mind and pass some order that why he has come to the conclusion that production of document or production of evidence would be necessary because court cannot issue the arbitrator cannot issue any witness summits therefore this mechanism is provided under section 27 of the arbitration act once you apply then court machinery will be available to you for issuance of witness summits either for production of documents or for production of witness and that order once passed under section 27 again question is whether that can be challenged or not of course remedy under article 136 is always available would be an order of court whether this order can be considered order but it is without adjudication therefore was remedy under article 136 to law in case of domestic arbitration has to be followed assignment usage also has to be followed by the arbitrator if contract is silent on particular aspect and make an award now 29 a is again very crucial provision which all of you please appreciate because of 2015 amendment it says that arbitrator has to make an award within 12 months from the date of filing of pleadings it further provides that if within that period of 12 months award is not rendered in that event parties by consent extend the mandate of the arbitral tribunal by six months not beyond six months there also it further provides that is one of the party doesn't agree for some reason that I don't want to give my consent in that event an application has to be made under section 29 a4 before the court for extension of time if both parties agree to grant six months extension and in spite of expiry of six months proceedings could not be culminated into an award in that event by consent you can't grant further extension you have to make an application to the court what in that event will consider who was responsible for this delay why it could not be completed whether arbitrator was responsible for this delay or parties were responsible orders in that event power to terminate the proceedings court has power to substitute an arbitrator in case of substitution the new arbitrator will decide from the stage the arbitration proceedings were left by the astral arbitrator court can impose certain conditions court can also penalize the arbitrator five percent per month or something like that there was further amendment to section 29 a that if court proposes to reduce the fees of the arbitrator or impose any penalty in that event personal hearing should be granted to the arbitrator because we will be the agreed party if any proposed decision is taken then there are again various judgments on this controversy at what stage you can apply for extension whether extension application has to be made before expiry of six months or you have made an application but it is not decided by court what happens to the arbitral tribunal whether he becomes process official whether he can proceed with the arbitral proceedings or proceedings are deemed to have been terminated upon expiry of six months whether court has power to grant extension even after expiry of six months another issue recently arose that suppose the arbitrator is appointed by a district court at the stage of section nine proceedings so district court is not a court under section it is not a court appointing arbitrator under section 11 because 11 is applicable only to high court or supreme court is the case maybe arbitrator is appointed by district court whether application for extension under section 29a has to be made before district court or if arbitrator has been appointed by supreme court you have to apply there or you can come to the court as defined under section 21e or not so my Lord Justice Barthi Dangra has clarified all this aspect in a recent judgment and she has held that you can apply before the court under section 21e in this case in the sense high court you can apply under 29a4 not before the district court Elkata High Court has taken a different view by saying that if you are not applied within the expiry of six months extension granted by parties in that even proceedings will come to an end there is no question about granting further extension once mandate of the arbitral tribunal is terminated by virtue of expiry of six months extension Mumbai High Court has taken a different view Calcutta High Court has taken a different view but my personal view is that the idea of disposal of the arbitral proceedings is that even if some extension is granted because sometimes educates may be busy sometimes there may be some genuine reasons that proceedings could not be completed within the time prescribed or sometimes arbitrator may not be able to devote time or somebody sick or witness is not available in that even reasonable approach should be taken by the court but stringent conditions can be always imposed by the court while granting extension after expiry of six months and 12 months so that is my view section 29a order again can be of course challenged before the super important article 136 another aspect i must tell you about section 5 because all the laws are supposed to know this sometimes if section 5 is missed there may be some derailment and i will tell you what is the relevance of section 5 section 5 provides for limited judicial intervention that court can entertain the proceedings which are prescribed under the arbitration act 1996 not other proceedings so what are the proceedings prescribed under section under arbitration act one is for referring the parties to arbitration under section 8 entry measures under section 9 section 11 for appointment of arbitrator section 14 for declaration that mandate is terminated section 15 for appointment of substitute arbitrator then section 27 for seeking court persistence then section 29a for extension of time and section 34 and 37 34 talks about challenge to an award committee of challenging an award 37 is an appeal accept these orders against various administrative orders or procedural orders passed by the arbitrator you would be tempted to come to court that he has not granted me a judgment or he has disallowed some question in cross examination or extension is not granted or some such thing if you file it will be dismissed as not maintainable therefore please read section 5 very very carefully what proceedings are permitted because judicial intervention is very limited by virtue of section 5 then what has to be done by them under section 31 one is that arbitral tribunal has to give reasons under section 31 3 unless otherwise provided under the old act arbitral tribunal was not bound to give reasons unless otherwise agreed now it is other way around arbitral tribunal is bound to give reasons unless otherwise agreed another important facet of 31 is 31 5 where arbitral tribunal is bound to serve a signed copy of the award to both the parties it is not sufficient if signed copy of the award is given to one party not served upon the other party one party who has received he would try to serve copy of that award on the other side for enforcement consistent view taken by the court is that it has to be signed copy from the arbitral to the parties not even upon the advocates or any agents what is the relevance of signed copy service of signed copy from the arbitrator is that limitation under section 24 3 comments from the top service of signed copy of the award that is the relevance there may be issue sometimes at the stage of execution or under section 34 that signed copy of the award is not received from the arbitrator by the respondent because he may be agreed or petitioner may be agreeing certain circumstances the award is partly allowed then what happens so there at that stage court may ask the arbitrator to produce the records and proceedings in court including the proof of service of the signed copy of the award and limitation can be ascertained from those records after 31 3 another important section is 31 5 31 6 where arbitral tribunal can make an interim award on the issue on which you can make final award you can make interim award so once interim award is made again limitation for challenging interim award also would be same 34 3 3 months from the date of getting signed copy of the interim award 31 7 talks about interest now because of the 1996 act earlier there used to be lot of controversies whether pre-reference interest can be avoided whether pendentality can be avoided whether post post award interest can be avoided by arbitrator at vote rate that is taken care of by section 31 7 that arbitral tribunal unless otherwise provided that means if agreement provides that interest is not payable in that even arbitrator is also bound by that provision he can't avoid interest if agreement provides for payment of some percentage of interest then arbitrator cannot avoid any on that or more than that if our arbitration agreement is silent or contract is silent on the rate or on the payability in that event arbitrator can avoid interest from due date till payment at reasonable rate 31 7 b again was amended prior to 2015 amendment the agreement provided the section provided that if award is silent about future interest does it mean that future interest is rejected or how do you read future interest from what date at what rate so prior to amendment the provision was that in that event if award is silent 18 percent interest should be read in the above from the date of our till payment when it was founded 18 percent is too exorbitant what to do then that came up with an amendment that if award is silent then it will not be 18 percent it will be 2 percent over and above the current rate of interest prescribed under the provisions of interest act 1978 is that means you take the rich deposit rate of interest described by the reserve bank of india and over and above that 2 percent more can be read in the award as and by of future interest so that is about 37 31 7 b 31 8 provides for cost then there are provisions for termination of mandate under section 25 under section 32 in certain circumstances if matter is settled or claim is withdrawn under section 32 1 a and 1 b proceedings can be terminated by the arbitral tribunal section 33 is the provision where if there are any inadvertent errors say calculation error is there or error of that time typing miss typographical error in that event within 30 days from the date of getting signed copy of the award party can apply for clarification if award is silent on some claims which were made but award has not dealt with this word that way you can even make an application for additional award again time is prescribed under section 33 even arbitrator has got power to make correction suomoto within 30 days or to make additional award within 60 days he has to serve a copy of that order or additional award upon the party signed copy again and as per 31 5 and limitation under section 34 3 in that event would start from the date of getting signed copy of the order or additional award because that order or additional award would merge with the original award and then first limitation will start but supreme court in a very leading judgment has clearly interpreted section 33 and has held that if a party has filed an application for correction and that application itself is not within the parameters of section 33 suppose you want to apply for correction on merits of the award and not any clerical mirror error or typographical error or error of such time in that event you have taken a chance your application is rejected by the orbital travel that this is not found within the parameters of section 33 in that event you don't get extension of limitation under 34 3 your limitation will be from the date you received signed copy of the original award and in this process suppose three months are over and court has no power to condone delay beyond 30 days then you will miss a remedy of challenging an award this is about 33 then section 34 is the most important section that provides for a remedy to challenge an award award has to be challenged only on the limited grounds available under section 34 there are series of judgments under section 34 the first leading judgment was in case of just as mb side delivered the judgment o in this case as associated genius he had expanded the scope of section 34 then that was criticized some more judgments came taking a different view then san jong again super in court took a view that in what circumstances you can say that award is visited by patent illegality but in the same judgment the court also took a view that the material piece of evidence or crucial part of evidence is not considered it may amount to patent illegality then under 34 3 what does no power to condone delay beyond 30 days there are also sufficient causes made there is section 5 of the limitation act is not able to section 34 3 because it is a self power of condition condonation order the the view taken by supreme court in 2004 was that there was automatic stay once you have filed your petition within the time prescribed award is not enforceable till that petition is disposed by virtue of that judgment there was serious crisis that you file your petition on the last day you don't move office objection petition will remain pending for three years the beneficiary of award will not be able to get the fruits of the award therefore there was an amendment in 2015 and there is no automatic stay if you want to stick stay you have to file a separate application for seeking stay and what has been given discretionary power to impose conditions upon the party seeking stay again the view taken is that this is a discretionary power of the court court may even grant unconditional stay court may impose some condition what may ask for entire deposit the principle or the principles of or provisions of order 41 may not apply to an application filed under section 36 for stay and if an order of deposit is passable then what happens whether that order is appealable so you have to see under section 37 whether this is one of the appealable order but if any interim order is passed for deposit there is no appeal against that you have to file specially petition under article 136 grounds of challenge under section 34 are many it will fall under that then only court will interfere there is no interference with the merits of the award findings of it cannot be interfered with both sides principles are laid down by supreme court one party realize upon one paragraph another realize on another paragraph and at the end of the day court has to decide whether case is made out under section 34 or not because of one of the amendment to section 34 the question arose whether any oral evidence can be laid under section 34 or not so prior to amendment in one of the supreme court judgment the view taken was that in appropriate case if court is satisfied that yes some part some crucial part of evidence could not be produced before the arbitral tribunal in that event court can grant an opportunity without right of cross-examination so that judgment was again misused by some parties then the amendment came after amendment again supreme court took a view that in appropriate case oral evidence can be put at section 34 stage that is again subject matter of debate in many matters what is that appropriate case because section 34 proceedings are not the original proceedings this is arising out of an award where both parties get ample opportunity to file proper pleadings to prove their case in the in respect of what relief is sought so that is about 34 again 34 there are two or three more issues which I want to deal with for your better appreciation one is that if claims are rejected by the arbitral tribunal then whether under section 34 even if court comes to the conclusion that claims are only rejected whether court can grant those claims for the first time so there in case of McDormand versus Bunn standard the supreme court had made that observation that court cannot correct an award claims are wrongly rejected then court can set aside that award and leave the parties to agitate or avail of the remedies available in law based on that judgment subsequently several other judgments came now that was one gray area where I had made a request for amendment to be before the committee appointed by the central government inviting suggestions for carrying out amendment to the arbitration my suggestion was this that if in case of a decree passed by civil court if first appropriate court can pass a decree where claim is rejected suit is dismissed then why in arbitration section 34 cannot this is rejected by the section 34 comes to the conclusion that claim is wrongly rejected because second round of litigation again there may be issue whether arbitration agreement survives may not survive there are views after views one view of the bomba high court is that if award is set aside or merits then you cannot invoke arbitration again then whether you are required to file the civil suit and all that but it has been made more complicated sometimes so I had made some suggestions I don't know how many of that would be accepted may not be accepted but what I thought proper I had made those suggestions section 36 of course you have to file an application for execution once award is attained finally then mechanism available under order 21 of CPC would be available to you you can apply for further interim reliefs before the executing court and section 37 is an is a provision providing for appeal providing for appeal challenging limited orders those orders orders orders are what is supposed to then under section 9 court has refused to grant relief for granted relief it is available under section 16 your plea of jurisdiction of the respondent is accepted proceedings are terminated it is available under section 8 an application is made for referring the parties to arbitration that application is allowed and parties are that application is rejected in that event also it is an appealable last is section 34 of the arbitration act where award is either set aside partly or fully or your challenge to the award is rejected these are the only orders prescribed under section 37 37 3 says that there is no second appeal available so once appeal is filed it is rejected or allowed remedy would be only under article 136 again there was an issue what would be the period of limitation for filing an appeal under section 37 because limitation was prescribed only under section 3434 challenging in award and no limitation for challenging and order appealable under section 30 seconds so that also by judgment Supreme court has taken a view whether it is under a commercial contact then separate period of limitation if it is intra court appeal 30 days in case of appeal from subordinate court to high court different provision of appeal so 30 days 60 days or 90 days these are the period of limitation prescribed under three different provisions supreme court has interpreted those provisions and is held depending upon the circumstances what orders is being challenged another line of judgment under section 37 is that what is the scope of section 37 so consistent view taken by supreme court is that scope of challenge under section 37 or powers of court under section 37 is very very limited the arguments which are not advanced before the arbitral tribunal or not advanced at the stage of section 34 cannot be allowed to be raised for the first time in section 37 proceedings section 37 court has to see whether judge passing an order under section 34 is right or wrong that's all so 37 proceedings are also sometimes fought very vigorously and additional grounds are sought to be included but because of the limited scope available under section 37 court does not interfere with additional grounds because power of section 34 itself is very limited therefore power of section 37 is more limited even limited than the powers of court under section 34 nine is provision where if fees of the arbitral tribunal is not so arbitral tribunal either can terminate the proceedings or arbitral tribunal can suspend the proceedings or arbitral tribunal can ask one of the party other than who has committed default that whether he's willing to pay confirmation of the other side if he agrees then that party will pay contribution of both the parties and that additional cost borne by one party would be subject matter of the arbitral cost in the final award if that party is not agreeable to pay then claimant if respondent is not agreeable to pay claimant has to decide what has to be done then arbitrator may suspend the proceedings supreme court has taken a view in case of AFCONS whether there is separate fees required to be deposited by the respondent in respect of counterclaim because there was some controversy in the post amendment whether claim includes counterclaim or separate deposit is required to be made in respect of counterclaim so the view taken is that counterclaim is also a claim so separate fees required to be deposited and as a result of that even in the rules framed by respect to high courts under arbitration act for payment of arbitration fees some amendments are made in tune with the view taken by supreme court in case of AFCONS that separate fees required to be deposited this is about section 39 in one very interesting issue before madras icon which i want to share with you where madras icon had appointed a retired judge as an arbitrator he gave direction to both parties only claimant paid the arbitration fees respondent did not pay the arbitration fees during the course of arbitral proceedings the respondent company was party to some insolvency proceedings before nclt and thereafter award came to be rendered by the arbitral tribunal arbitral tribunal demanded the contribution of the respondent in the sum of some more than 50 lakhs the resolution professional he raised an issue before the nclt before the madras icon where the award was challenged by resolution professional that resolution professional or the company was not required to pay the fees of the arbitrator because proceedings at some stage reached nclt so the rendered arbitrator also was implanted as a party rendered arbitrator make an application for claiming a lien on the amount under section 39 and ultimately madras icon took a view that there was no objection raised by the respondent company respondent before the arbitral petitioner under section 34 about the fees of the arbitrator circumstances the areas of fees of the arbitral tribunal has to be considered as a claim to be treated as claim at prior with the arbitre prior with the liquidators cost so you can't treat this as a sort of unsecured claim and and is required to wait along with other unsecured creators so this is a unique judgment I don't know whether it is right or wrong I am not here to make any comment it is does not matter as I quote of the arbitrators are happy because of the judgment that they are protected of their fees even in case of company before nclt so thank you very much Mr. Vikas for giving this opportunity I have tried my best to share my experience and my note can be shared with all the participants those who are interested they can read if necessary we can have one more session but I would suggest that you should have domestic because I have count almost everything if your participants are interested we can have one lecture on enforcement of foreign amount which is the gray area where there are not many lectures yes this and you find out if any such lectures are required to vote subject to my own entity please let me know in advance I will try my best thank you very much so I am reminded of justice a secret order that it's not important to be number one but it is important to be unique because you are the only one so that's why they say that once you come on the arbitration part one will always be in rest and the very fact that justice energy though we had requested her to connect somehow there's some technical issue she also flew like all of us and we have received a message that Parvati Devi says excellent speech sir we learned a lot thank you just checking it out if there is any question on the youtube yes yes just hold on so one question is one one I sent on the chat let's assume the proceedings are over but that time the entire award has been reserved judgment reserved meanwhile that period has been over under section 29A and the arbitrators have written as to seek the extension and if there is no application moved on extension under 29A does it bring down the mandate is over or how do you go about it sir that is taken care of by Bombay High Court and is also for making an award yes sir and with that period it is not up to the date of hearing you have to make an award and therefore application under section 29A can be made now one of the High Court has taken a view it has gone to the extent of saying that even at section 31st stage court can pass an order for grant of extension otherwise what is the idea of going to arbitration if on this ground after gamut of number of hearings and payment of use amount to the lawyers and arbitrators if extension is not granted and because of that entire proceedings are terminated and start the arbitration dino that will be murder of arbitration therefore I am very happy that one of the other High Court has taken this view that even at stage of section 34 court has power to grant extension. Thank you sir we are all glued with your insights and I think I will ask Nikhil to share his insights thank you thank you because I am quite sure that he too would have found it very useful. How do you Nikhil? Thank you sir thank you lots of people it was really insightful and gave a very easy and practical way for all of us to understand the intricacies of the subject and it gave a very practical way of handling arbitration because sometimes all of us get so caught up in preparing for an arbitration sometimes more like a civil suit and a case in the court that one forgets unfortunately that this is an arbitration matter and the basic objective of arbitration is lost out which is to have an easy and an efficacious remedy to all our disputes commercial disputes primarily because commercial disputes and commercial disputes time also has a very important role to play so thank you lots of people it is indeed a pleasure to have heard this words. Thank you sir we will take these sessions forward with you provided whenever you get the time you are always forward for your knowledge and for our friends we will be having a session on deciphering software licensing tools that is by Devashree Mukherjee who is a leader Asia Pacific region at QSERA so do connect with us tomorrow at 5 p.