Arbitration and Conciliation Act, 1996
Part I and Part III formalise the process of Arbitration and the process of Conciliation, Respectively.
The arbitration process can start only if there is a valid Arbitration Agreement between the parties before the emergence of the dispute. As per Section 7, such an agreement must be in writing. The contract regarding which the dispute exists must either contain an arbitration clause or refer to a separate document signed by the parties, including the arbitration agreement. The existence of an arbitration agreement can also be inferred by written correspondence such as letters, telex, or telegrams which provide a record of the agreement. An exchange of statement of claim and defence in which the existence of an arbitration agreement is alleged by one party and not denied by the other is also considered a valid written arbitration agreement.
Any party to the dispute can start the process of appointing an arbitrator. If the other party does not cooperate, the party can approach the office of Chief Justice for the appointment of an arbitrator. There are only two grounds upon which a party can challenge the appointment of an arbitrator – reasonable doubt in the impartiality of the arbitrator and the lack of proper qualification of the arbitrator as required by the arbitration agreement. A sole arbitrator or panels of arbitrators so appointed constitute the Arbitration Tribunal.
Except for some interim measures, there is very little scope for judicial intervention in the arbitration process. The arbitration tribunal has jurisdiction over its jurisdiction. Thus, if a party wants to challenge the jurisdiction of the arbitration tribunal, it can do so only before the tribunal itself. If the tribunal rejects the request, there is little the party can do except approach a court after the tribunal makes an award. Section 34 provides certain grounds upon which a party can appeal to the principal civil court of original jurisdiction for setting aside the award.
Once the period for filing an appeal for setting aside an award is over, or if such an appeal is rejected, the award is binding on the parties and is considered a court decree.
Conciliation is a less traditional form of arbitration. This process does not require the existence of any prior agreement. Any party can request the other party to appoint a conciliator. One conciliator is preferred, but two or three are also allowed. In the case of multiple conciliators, all must act jointly. If a party rejects an offer to conciliate, there can be no conciliation.
Parties may submit statements to the conciliator describing the general nature of the dispute and the points at issue. Each party sends a copy of the statement to the other. The conciliator may request further details, meet the parties, or communicate with the parties orally or in writing. Parties may even submit suggestions for the settlement of the dispute to the conciliator.
When it appears to the conciliator that elements of settlement exist, he may draw up the terms of settlement and send them to the parties for their acceptance. If both parties sign the settlement document, it shall be final and binding on both.
Note that in the USA, this process is similar to Mediation. However, in India, Mediation is different from Conciliation and is a completely informal type of ADR mechanism.
This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being. Further, despite all efforts made to ensure the accuracy and correctness of the information published, White Code VIA Mediation and Arbitration Centre shall not be responsible for any errors caused due to human error or otherwise.