Third Round of Amendments in 2015
The question concerning whether part I of the Arbitration and Conciliation Act, 1996 would apply to foreign arbitrations was first analyzed by the Hon'ble Supreme Court of India in a praised judgment by a three-Judge Bench in the year 2002 titled Bhatia International versus Mass Trading SA1 ("Bhatia International"). The main issue under the watchful eye of Hon'ble Supreme Court was the interpretation of Section 2(2) of the un-amended Act which expressed that, "This Part will apply where the place of arbitration is in India." The Hon'ble Apex Court had contrasted the said arrangement and the UNCITRAL Model Law, which obviously expressed in its preamble that, "the arrangements of this Law apply just if the place of arbitration is in the domain of this State.".
Indeed, even the world's two most prominent nations (India and Pakistan) likewise agreed to refer the dispute to Arbitration and had referred the dispute relating with the Indus Water Treaty 1960 to The Permanent Court of Arbitration. This move explained and supported the significance of arbitration universally
With the financial development of the country, the foreign entities began business through their 100% subsidiaries. In the long run, an exciting question of law sought consideration under the watchful eye of the Hon'ble Apex Court which was whether it is reasonable under the Arbitration Act, 1996 for two Indian Companies to consent to refer their commercial disputes to a place of arbitration outside India with administering law being English law. It was seen that as one of the entities indirectly involved in the matter is a foreign entity, therefore, there is some foreign element, as Section 28(1)(b) of the 1996 Act explicitly perceives recognizes such autonomy to pick the governing law, in this way they said provision is legitimate.
The 2015 Act can be looked as an aid for the gathering who succeeded before the arbitral tribunal, as in the previous act of 1996 if the award passed by the arbitral tribunal was challenged before the court, even on the issuance of notice by the court would commensurate as astay but by virtue of the amendment in the 2015 Act, a particular stay must be allowed.
It is to be noticed that not all issues/disputes can be referred to arbitration regardless of whether the contracts and so forth contain an arbitration clause, it's being noticed that the disputes relating to Trust, trustees, and recipients emerging out of the Trust Deed and the Trust Act are not capable of being decided by the arbitrator.