ARBITRATION TRIBUNAL: COMPOSITION, JURISDICTION , APPOINTMENT

ARBITRATION TRIBUNAL: COMPOSITION, JURISDICTION , APPOINTMENT

Author-Anurupa Pal, Techno India University, Kolkata

INTRODUCTION

We all know that “litigation” is a process that is both time-consuming and requires monetary effort for the parties involved as a result many people tend to avoid such a process and believe in the out-of-court settlement and thus most of the time justice is not served properly. Hence to bridge the gap between the Judiciary and the citizens of India as well as reduce the burden of cases led to the passing of the Arbitration and Conciliation Act, 1996, with the main aim to consolidate and amend the law relating to domestic arbitration and also to provide for a law relating to conciliation and related matters. It aims to ensure the smooth settlement of domestic and international commercial disputes.

Arbitration in simple words means the settlement of an argument or disagreement between two parties, outside the course of the court by a neutral third party known as the arbitrator or more than one person known as “Arbitral Tribunal” or “Arbitration Tribuna”l. The decision made by the same is binding on both the parties. To go to the process of arbitration both parties need to sign a written agreement which can be in the form of an I) Arbitral clause II) A contract or III) in the form of a separate legal agreement known as an “Arbitration Agreement”.

Keywords (Minimum 5): Arbitration and Conciliation Act,1996, Arbitration, Binding decision, Composition, Arbitral tribunal, Appointment, Jurisdiction

Meaning, Definition & Explanation

The term ‘Arbitration means the determination or settlement of a dispute by the decision of one or more persons called “Arbitrator” or “Arbitral Tribunal” In the case of [1]Amar Chand Vs. Ambika Jute Mills ( 1966) held that arbitration is “Judging of a dispute between parties or group of people by someone not involved in the dispute and whose decision both the parties agree to accept. Here, an Arbitrator is a person to whom the parties submit the matters in dispute and whose functions are more or less judicial thus giving equal justice to all. When the parties in dispute appoint more than one arbitrator, it is called an Arbitral Tribunal. In [2]Satyendra Kumar Vs. Hind Construction Ltd. (1852) it was held that where the parties to dispute refer the matter to a person and such person holds a judicial inquiry in deciding that dispute and comes to a judicial decision, such person is called an “arbitrator”

An arbitration tribunal, also known as an arbitral tribunal, is a panel of unbiased adjudicators or arbitrators assembled to resolve disputes through the arbitration procedure. These courts, which include one or more arbitrators, play an important role in settling disputes between the parties concerned. Unlike judges in domestic courts, an arbitral tribunal’s authority, powers, and obligations are determined by the appropriate legal framework rather than national laws and procedures. Typically, these tribunals have the jurisdiction to rule on substantive disputes, assign expenses, weigh precedents, and carry out their tasks within the agreed-upon scope of powers.

COMPOSITION

According to Section 10 (1) of the Act of 1996, the parties to dispute are free to appoint a sole arbitrator or more than one arbitrator The number of arbitrators should always be odd and never an even number. If the parties fail to determine the number the arbitral tribunal shall consist of a sole arbitrator. If the number of arbitrators is three, the third appointed arbitrator shall act as a “Presiding Arbitrator”.

QUALIFICATIONS OF AN ARBITRATOR

  1. He should be Indian
  2. He must be impartial
  3. He must not be interested in the subject matter or the parties
  4. There should not be any dispute as to his professional Qualification
  5. He should not buy any claim of the parties
  6. He holds the quasi-judicial position, he should not be biased.

APPOINTMENT

1) Appointment by Parties – The general rule followed is the Appointment by parties where the right to appoint the members of the arbitral tribunal. The parties may agree to appoint a sole or more than one arbitrator. If both parties do not name their arbitrator, they may agree that arbitrators or arbitrators may be appointed by a third designated person. When one parties fail to appoint.

2) Appointment by Court – Where both parties have appointed two arbitrators each but are unable to appoint a third arbitrator, within the time frame of 30 days, the chief justice or any other person or institution or authority to whom the chief justice may delegate this function will appoint the Arbitrator or third arbitrator.

JURISDICTION

  • The jurisdiction of an arbitral tribunal is derived from the agreement between the parties, as stated in their arbitration agreement. The arbitration agreement must be in writing and may be in the form of a separate agreement or a clause within a contract.
  • An arbitral tribunal’s jurisdiction is restricted to the area of the dispute specified in the contract of arbitration. Tribunals have the authority to rule on issues affecting their jurisdiction, such as whether the arbitration agreement exists or is legal.
  • A plea that the arbitral tribunal does not have jurisdiction shall be raised not later than the submission of the statement of defence.
  • A plea that the arbitral tribunal is exceeding the scope of its authority shall be raised as soon as the matter alleged to be beyond the scope of its authority is raised during the arbitral proceedings.
  • The decision passed by the arbitral tribunal shall be binding on both parties which is popularly known as the arbitral award.

CONCLUSION

The composition, jurisdiction, and characterization of an arbitration panel are all significant components of the arbitration process. The establishment of the arbitral tribunal plays an essential role in the arbitration process since it involves the appointment of arbitrators by the relevant parties or appointed organisations. If the authorised entity fails to select an arbitrator, the High Court or Supreme Court may intervene. The membership of the tribunal, or the selection of a solitary arbitrator, is a key aspect of arbitration that influences the course and outcome of the proceedings. In some cases, such as those regarding investment treaty protection, arbitrators may be appointed by institutions such as the ICC International Court of Arbitration.

Jurisdiction is another important aspect of the arbitral tribunal’s job. The arbitral panel can decide on its jurisdiction, including the determination of objections to the existence or legality of the arbitration agreement. This authority guarantees that the tribunal can effectively assess its ability to manage disputes.

In conclusion, knowing the structure, jurisdiction, and definition of an arbitral tribunal is essential for navigating the complexities of arbitration. The selection of arbitrators, resolution of jurisdictional issues, and recognition of arbitral tribunals’ role in conflict settlement are essential elements that promote the effectiveness and integrity of arbitration proceedings. Understanding these fundamental factors allows stakeholders to engage in arbitration with clarity and confidence, encouraging a fair and quick settlement of disputes.

REFERENCES

  1. Books / Commentaries / Journals Referred
    1. Book – Lectures on Arbitration, conciliation and A.D.R Systems, Author – Dr. Rega Surya Rao
  2. Online Articles / Sources Referred
    1. LoginUniversitofLucknow, https://udrc.lkouniv.ac.in/Content/DepartmentContent/SM_367aca78-6e00-4cb5-82f6-18ed4d3299d4_30.pdf (last visited Mar. 4, 2024).
    2. Terminating arbitration: lessons from India, Global Arbitration Review, https://globalarbitrationreview.com/review/the-asia-pacific-arbitration-review/2024/article/terminating-arbitration-lessons-india (last visited Mar. 4, 2024).
    3. Arbitration and Conciliation Act, 1996 – An Overview, Search eLibrary:: SSRN, https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3582896 (last visited Mar. 4, 2024).
    4. https://www.coursesidekick.com/law/3626445#:~:text=The%20person%20by%20whom%20the,to%20move%20to%20the%20court. (last visited Mar. 4, 2024).
  3. Cases Referred
    1.  M/S. Amarchand Lalitkumar vs Shree Ambica Jute Mills Ltd on 3 May 1962, Indian Kanoon – Search engine for Indian Law, https://indiankanoon.org/doc/1371659/#:~:text=The%20appellant’s%20case%20was%20that,were%20either%20directly%20or%20indirectly (last visited Mar. 4, 2024).
    2. Satyendra Kumar vs Hind Constructions Ltd. on 14 August 1951, Indian Kanoon – Search engine for Indian Law, https://indiankanoon.org/doc/1333612/ (last visited Mar. 4, 2024).

[1] M/S. Amarchand Lalitkumar vs Shree Ambica Jute Mills Ltd on 3 May, 1962, Indian Kanoon – Search engine for Indian Law, https://indiankanoon.org/doc/1371659/#:~:text=The%20appellant’s%20case%20was%20that,were%20either%20directly%20or%20indirectly (last visited Mar. 4, 2024).

[2] Satyendra Kumar vs Hind Constructions Ltd. on 14 August, 1951, Indian Kanoon – Search engine for Indian Law, https://indiankanoon.org/doc/1333612/ (last visited Mar. 4, 2024).

 

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