Judicial Intervention in Arbitral process in the light of BALCO judgement
In the judgement of Bharat Aluminium Co. v. Kaiser Technical Services, the bench confined and limited the scope of intervention by the Indian courts within the process of arbitration, which are conducted outside the jurisdictional boundaries of India by limiting the judicial intervention the applicability of which is mentioned in part 1 of the Indian Arbitration and Conciliation Act, 1996.
Changes that took place post the BALCO Judgement:
- This was an important development within the field because it represented a paradigm shift far away from its previous practice.
- The Apex Court’s willingness to do so rang the message that Indian courts won’t be hesitant to be guided by the provisions of applicable international conventions and collocate with the Indian legislation in conformity with an equivalent.
- This has proved to be important because a serious hurdle that arbitration practitioners face in India is that the courts must adapt accordingly to arbitration processes governed by a law supported by the UNCITRAL Model Law.
The BALCO judgment was well-received since Part I of the Arbitration and Conciliation Act incorporated many provisions that allowed judicial interference by the Indian courts within the arbitral proceedings, especially those having a far-off seat, which thereby continues the whole process and makes the foreign parties hesitant to affect Indian parties because of the invasive nature of the Judiciary. This nonetheless also equipped foreign investors with a renewed confidence in handling Indian parties.
JUDICIAL INTERVENTION UNDER ARBITRATION AND RELEVANT SECTIONS
SECTION 5 OF ARBITRATION AND CONCILIATION ACT, 1996- This section states that “Notwithstanding anything contained in the other law for the time being effective, in matters governed by this Part, no judicial authority shall intervene except where it is so provided during this Part.”
SECTION 8- This section provides that if an Arbitration Agreement exists between the parties, the judicial courts shall initially instantly refer any matter brought before them for consideration through arbitration.
COURT INTERVENTION, WHEN AN ARBITRATION AGREEMENT EXISTS
Generally, the Court of other Judicial Authority doesn't intervene in any arbitration proceedings or arbitration award. The law of non-intervention is predicated on the premise that when parties to any commercial contract by their consent have decided to resolve their disputes by way of mediation and conciliation through the method of arbitration, then the judiciary would not have any reason to intervene during this proceeding of arbitration.
However, the courts are empowered to think about any matter, where it feels that prima facie, no valid arbitration agreement exists between the parties. During this case, any one of the parties is to create an application to the court accompanying the original Arbitration Agreement or a duly certified copy of the Agreement to prove an agreement between them.
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 Foundation shall not be responsible for any errors caused due to human error or otherwise.