Arbitration Act 1940 Complete Act - Citation 133109 - Bare Act

Act Info:

ARBITRATION ACT, 1940

ARBITRATION ACT, 1940

10 of 1940

11th March, 1940

An Act to consolidate and amend the law relating to Arbitration. WHEREAS it is expedient to consolidate and amend the law relating to Arbitration

CHAPTER 01: INTRODUCTORY

SECTION 01: SHORT TITLE, EXTENT AND COMMENCEMENT

(1) This Act may be called The Arbitration Act 1940.

(2) It extends to a[the whole of India b[except the State of Jammu and Kashmir].

(3) It shall come into force on the 1st day of July, 1940.

SECTION 02: DEFINITIONS

In this Act, unless there is anything repugnant in the subject or context,-

(a) "arbitration agreement" means a written agreement to submit present or future differences to arbitration, whether an arbitrator is named therein in or not:

(b) "award" means an arbitration award;

(c) "Court" means a Civil Court having jurisdiction to decide the questions forming the subject matter of the reference if the same had been the subject- matter of a suit, but does not, except for the purpose of arbitration proceedings under section 21-, include a Small Cause Court;

(d) "legal representative" means a person who in law represents the estate of a deceased person, and includes any person who intermeddles with the estate of the deceased, and, where a party acts in a representative character, the person on whom the estate devolves on the death of the party so acting;

(e) "reference" means a reference to arbitration.

CHAPTER 02: ARBITRATION WITHOUT INTERVENTION OF A COURT

SECTION 03: PROVISIONS IMPLIED IN ARBITRATION AGREEMENT

An arbitration agreement, unless a different intention is expressed therein, shall be deemed to include the provisions set out in the First Schedule in so far as they are applicable to the reference.

SECTION 04: AGREEMENT THAT ARBITRATORS BE APPOINTED BY THIRD PARTY

The parties to an arbitration agreement may agree that any reference thereunder shall be to an arbitrator or arbitrators to be appointed by a person designated in the agreement either by name or as the holder for the time being of any office or appointment.

SECTION 05: AUTHORITY OF APPOINTED ARBITRATOR OR UMPIRE IRREVOCABLE EXCEPT BY LEAVE OF COURT

- The authority of an appointed arbitrator or umpire shall not be revocable except with the leave of the Court, unless a contrary intention is expressed in the arbitration agreement.

SECTION 06: ARBITRATION AGREEMENT NOT TO BE DISCHARGED BY DEATH OF PARTY THERETO

(1) An arbitration agreement shall not be discharged by the death of any party thereto, either as respects the deceased or any other party, but shall in such event be enforceable by or against the legal representative of the deceased.

(2) The authority of an arbitrator shall not be revoked by the death of any party by whom he was appointed.

(3) Nothing in this section shall affect the operation of any law by virtue of which any right of action is extinguished by the death of a person.

SECTION 07: PROVISIONS IN CASE OF INSOLVENCY

(1) Where it is provided by a term in a contract to which an insolvent is a party that any differences arising there out or in connection therewith shall be referred to arbitration, the said term shall, if the receiver adopts the contract, be enforceable by or against him so far as it relates to any such differences.

(2) Where a person who has been adjudged an insolvent had, before the commencement of the insolvency proceedings, become a party to an arbitration agreement, and any matter to which the agreement applies is required to be determined in connection with, or for the purposes of the insolvency proceedings then, if the case is one to which sub-section (1) does not apply, any other party to the agreement or the receiver may apply to the Court having jurisdiction in the insolvency proceedings for an order directing that the matter in question shall be referred to arbitration in accordance with the agreement, and the Court may, if it is of opinion that, having regard to all the circumstances of the case, the matter ought to be determined by arbitration, make an order accordingly.

(3) In this section the expression "receiver" includes an Official Assignee.

SECTION 08: POWER OF COURT TO APPOINT ARBITRATOR OR UMPIRE

(1) In any of the following cases-

(a) where an arbitration agreement provides that the reference shall be to one or more arbitrators to be appointed by consent of the parties, and all the parties do not after differences have arisen, concur in the appointment or appointments; or

(b) if any appointed arbitrator or umpire neglects or refuses to act, or is incapable of acting, or dies, and the arbitration agreement does not show that it was intended that the vacancy should not be supplied and the parties or the arbitrators, as the case may be, do not supply the vacancy; or

(c) where the parties or the arbitrators are required to appoint an umpire and do not appoint him; any party may serve the other parties or the arbitrators, as the case may be, with a written notice to concur in the appointment or appointments or in supplying the vacancy.

(2) If the appointment is not made within fifteen clear days after the service of the said notice, the Court may, on the application of the party who gave the notice and after giving the other parties an opportunity of being heard, appoint an arbitrator or arbitrators or umpire, as the case may be, who shall have like power to act in the reference and to make an award as if he or they had been appointed by consent of all parties.

SECTION 09: POWER TO PARTY TO APPOINT NEW ARBITRATOR OR IN CERTAIN CASES, A SOLE ARBITRATOR

- Where an arbitration agreement provides that a reference shall be to two arbitrators, one to be appointed by each party, then, unless a different intention is expressed in the agreement,

(a) if either of the appointed arbitrators neglects or refuses to act, or is incapable of acting, or dies, the party who appointed him may appoint a new arbitrator in his place;

(b) if one party fails to appoint an arbitrator, either originally or by way of' substitution as aforesaid, for fifteen clear days, after the service by the other party of a notice in writing to make the appointment such other party having appointed his arbitrator before giving the notice, the party who has appointed an arbitrator may appoint that arbitrator to act as sole arbitrator in the reference, and his award shall be binding on both parties as if he had been appointed by consent: Provided that the Court may set aside any appointment as sole arbitrator made under clause (b) and either, on sufficient cause being shown allow further time to the defaulting party to appoint an arbitrator or pass such other order as it thinks fit.

Explanation.- The fact that an arbitrator or umpire, after a request by either party to enter on and proceed with the reference, does not within one month comply with the request may constitute a neglect or refusal to act within the meaning of section 8 and this section.

SECTION 10: PROVISIONS AS TO APPOINTMENT OF THREE OR MORE ARBITRATORS

- (1) Where an arbitration agreement provides that a reference shall be to three arbitrators, one to be appointed by each party and the third by the two appointed arbitrators, the agreement shall have effect as if it provided for the appointment of an umpire, and not for the appointment of a third arbitrator, by the two arbitrators appointed by the parties.

(2) Where an arbitration agreement provides that a reference shall be to three arbitrators to be appointed otherwise than as mentioned in sub-section (1), the award of the majority shall, unless the arbitration agreement otherwise provides, prevail.

(3) Where an arbitration agreement provides for the appointment of more arbitrators than three, the award of the majority, or if the arbitrators are equally divided in their opinions, the award of the umpire shall, unless the arbitration agreement otherwise provides, prevail.

SECTION 11: POWER TO COURT TO REMOVE ARBITRATORS OR UMPIRE IN CERTAIN CIRCUMSTANCES

(1) The Court may, on the application of any party to a reference, remove an arbitrator or umpire who fails to use all reasonable despatch in entering on and proceeding with the reference and making an award.

(2) The Court may remove an arbitrator or umpire who has misconducted himself or the

proceedings.

(3) Where an arbitrator or umpire is removed under this section, he shall not be entitled to receive any remuneration in respect of his services.

(4) For the purposes of this section the expression "proceeding with the reference" includes, in a case where reference to the umpire becomes necessary, giving notice of that fact to the parties and to the umpire.

SECTION 12: POWER OF COURT WHERE ARBITRATOR IS REMOVED OR HIS AUTHORITY REVOKED

(1) Where the Court removes an umpire who has not entered on the reference or one or more arbitrators (not being all the arbitrators), the Court may, on the application of any party to the arbitration agreement, appoint persons to fill the vacancies.

(2) Where the authority of an arbitrator or arbitrators or an umpire is revoked by leave of the Court, or where the Court removes an umpire who has entered on the reference or a sole arbitrator or all the arbitrators, the Court may, on the application of any party to the arbitration agreement, either-

(a) appoint a person to act as sole arbitrator in the place of the person or persons displaced, or

(b) order that the arbitration agreement shall cease to have effect with respect to the difference referred.

(3) A person appointed under this section as an arbitrator or umpire shall have the like power to act in the reference and to make an award as if he had been appointed in accordance with the arbitration agreement.

SECTION 13: POWERS OF ARBITRATOR

The arbitrators or umpire shall, unless a different intention is expressed in the agreement, have power to-

(a) administer oath to the parties and witnesses appearing;

(b) state a special case for the opinion of the Court on any question of law involved, or state the award, wholly or in part, in the form of a special case of such question for the opinion of the Court;

(d) correct in an award any clerical mistake or error arising from any accidental slip or omission;

(e) administer to any party to the arbitration such interrogatories as may, in the opinion of the arbitrators or umpire, be necessary.

SECTION 14: AWARD TO BE SIGNED AND FILED

(1) When the arbitrators or umpire have made their award, they shall sign it and shall give notice in writing to the parties of the making and signing thereof and of the amount of fees and charges payable in respect of the arbitration and award.

(2) The arbitrators or umpire shall, at the request of any party to the arbitration agreement or any person claiming under such party or if so directed by the Court and upon payment of the fees and charges due in respect of the arbitration and award and of the costs and charges of filing the award, cause the award or a signed copy of it, together with any depositions and documents which may have been taken and proved before them, to be filed in Court, and the Court shall thereupon give notice to the parties of the filing of the award.

(3) Where the arbitrators or umpire state a special case under clause (b) of section 13-, the Court, after giving notice to the parties and hearing them, shall pronounce its opinion thereon and such opinion shall be added to, and shall form part of, the award.

SECTION 15: POWER O COURT TO MODIFY AWARD

The Court may by order modify or correct an award-

(a) where it appears that a part of the award is upon a matter not referred to arbitration and such part can be separated from the other part and does not affect the decision on the matter referred; or

(b) where the award is imperfect in form, or contains any obvious error which can be amended without affecting such decision; or

SECTION 16: POWER TO REMIT AWARD

(1) The Court may from time to time remit the award or any matter referred to arbitration to the arbitrators or umpire for reconsideration upon such terms as it thinks fit-

(a) where the award has left undetermined any of the matters referred to arbitration, or where it determines any matter not referred to arbitration and such matter cannot be separated without affecting the determination of the matters referred; or

(b) where the award is so indefinite as to be incapable of execution; or

(2) Where an award is remitted under sub-section (1) the Court shall fix the time within which the arbitrator or umpire shall submit his decision to the Court: Provided that any time so fixed may be extended by subsequent order of the Court.

(3) An award remitted under sub-section (1) shall become void on the failure of the arbitrator or umpire to reconsider it and submit his decision within the time fixed.

SECTION 17: JUDGMENT IN TERMS OF AWARD

Where the Court sees no cause to remit the award or any of the matters referred to arbitration for reconsideration or to set aside the award, the Court shall, after the time for making an application to set aside the award has expired, or such application having been made, after refusing it, proceed to pronounce judgment according to the award, and upon the judgment so pronounced a decree shall follow and no appeal shall lie from such decree except on the ground that it is in excess of, or not otherwise in accordance with, the award.

SECTION 18: POWER OF COURT TO PASS INTERIM ORDERS

(1) Notwithstanding anything contained in section 17-, at any time after the filing of the award, whether notice of the filing has been served or not, upon being satisfied by affidavit or otherwise that a party has taken or is about to take steps to defeat, delay or obstruct the execution of any decree that may be passed upon the award, or that speedy execution of the award is just and necessary, the Court may pass such interim orders as it deems necessary.

(2) Any person against whom such interim orders have been passed may show cause against such orders, and the Court, after hearing the parties, may pass such further orders as it deems necessary and just.

SECTION 19: POWER TO SUPERSEDE ARBITRATION WHERE AWARD BECOMES VOID OR IS SET ASIDE

Where an award has become void under sub-section (3) of section 16-or has been set aside, the Court may by order supersede the reference and shall thereupon order that the arbitration agreement shall cease to have effect with respect to the difference referred.

CHAPTER 03: ARBITRATION WITH INTERVENTION OF A COURT WHERE THERE IS NO SUIT PENDING

SECTION 20: APPLICATION TO FILE IN COURT ARBITRATION AGREEMENT

(1) Where any persons have entered into an arbitration agreement before the institution of any suit with respect to the subject-matter of the agreement or any part of it, and where a difference has arisen to which the agreement applies they or any of them, instead of proceeding under Chapter II, may apply to a Court having jurisdiction in the matter to which the agreement relates, that the agreement be filed in Court.

(2) The application shall be in writing and shall be numbered and registered as a suit between one or more of the parties interested or claiming to be interested as plaintiff or plaintiffs and the remainder as defendant or defendants, if the application has been presented by all the parties, or, if otherwise, between the applicant as plaintiff and the other parties as defendants.

(3) On such application being made, the Court shall direct notice thereof to be given to all parties to the agreement other than the applicants, requiring them to show cause within the time specified in the notice why the agreement should not be filed.

(4) Where no sufficient cause is shown, the Court shall order the agreement to be filed and shall make an order of reference to the arbitrator appointed by the parties, whether in the agreement or otherwise, or, where the parties cannot agree upon an arbitrator, to an arbitrator appointed by the Court.

(5) Thereafter the arbitration shall proceed in accordance with, and shall be governed by, the other provisions of this Act so far as they can be made applicable.

CHAPTER 04: ARBITRATION IN SUITS

SECTION 21: PARTICS TO SUIT MAY APPLY FOR ORDER OF REFERENCE

Where in any suit all the parties interested agree that any matter in difference between them in the suit shall be referred to arbitration, they may at any time before judgment is pronounced apply in writing to the Court for an order of reference.

SECTION 22: APPOINTMENT OF ARBITRATOR

The arbitrator shall be appointed in such manner as may be agreed up on between the parties.

SECTION 23: ORDER OF REFERENCE

(1) The Court shall, by order, refer to the arbitrator the matter in difference which is required to determine, and shall in the order specify such time as it thinks reasonable for the making of the award.

(2) Where a matter is referred to arbitration, the Court shall not, save in the manner and to the extent provided in this Act, deal with such matter in the suit.

SECTION 24: REFERENCE TO ARBITRATION BY SOME OF THE PARTIES

Where some only of the parties to a suit apply to have the matters in difference between them referred to arbitration in accordance with, and in the manner provided by, section 21-, the Court may, if it thinks fit, so refer such matters to arbitration (provided that the same can be separated from the rest of the subject-matter of the suit) in the manner provided in that section but the suit shall continue so far as it relates to the parties who have not joined in the said application and to matters not contained in the said reference as if no such application had been made, and an award made in pursuance of such a reference shall be binding only on the parties who have joined in the application.

SECTION 25: PROVISIONS APPLICABLE TO ARBITRATIONS UNDER THIS CHAPTER

- The provisions of the other Chapters shall, so far as they can be made applicable, apply to arbitrations under this Chapter: Provided that the Court may, in any of the circumstances mentioned in sections 8- ,10-,11-and12-, instead of filling up the vacancies or making the appointments, make an order superseding the arbitration and proceed with the suit and where the Court makes an order superseding the arbitration undersection 19-, it shall proceed with the suit.

CHAPTER 05: GENERAL

SECTION 26 Application of Chapter

- Save as otherwise provided in this Act, the provisions of this Chapter shall apply to all arbitrations.

SECTION 27: POWER OF ARBITRATORS TO MAKE AN INTERIM AWARD

(1) Unless a different intention appears in the arbitration agreement, the arbitrators or umpire may, if they think fit, make an interim award.

(2) All references in this Act to an award shall include references to an interim award made under sub-section (1).

SECTION 28: POWER TO COURT ONLY TO ENLARGE TIME FOR MAKING AWARD

(1) Court may, if it thinks fit, whether the time for making the award has expired or not and whether the award has been made or not, enlarge from time to time the time for making the award.

(2) Any provisions in an arbitration agreement whereby the arbitrators or umpire may, except with the consent of all the parties to the agreement, enlarge the time for making the award, shall be void and of no effect.

SECTION 29: INTEREST ON AWARDS

Where and in so far as an award is for the payment of money the Court may in the decree order interest, from the date of the decree at such rate as the Court deems reasonable, to be paid on the principal sum as adjudged by the award and confirmed by the decree.

SECTION 30: GROUNDS FOR SETTING ASIDE AWARD

An award shall not be set aside except on one or more of the following grounds, namely:-

(a) that an arbitrator or umpire has misconducted himself or the proceedings;

(b) that an award has been made after the issue of an order by the Court superseding the arbitration or after arbitration proceedings have become invalid under section 35-;

SECTION 31: JURISDICTION

- (1) Subject to the provisions of this Act, an award may be filed in any Court having jurisdiction in the matter to which the reference relates

(2) Not with standing anything contained in any other law for the time being in force and save as otherwise provided in this Act, all questions regarding the validity, effect or existence of an award or an arbitration agreement between the parties to the 'agreement or persons claiming under them shall be decided by the Court in which the award under the agreement has been, or may be, filed, and by no other Court.

(3) All applications regarding the conduct of arbitration proceedings or otherwise arising out of such proceedings shall be made to the Court where the award has been, or may be, filed, and to no other Court.

(4) Notwithstanding anything contained elsewhere in this Act or in any law for the. time being in force, where in any reference any application under this Act has been made in a Court competent to entertain it, that Court alone shall have jurisdiction over the arbitration proceedings and all subsequent applications arising out of that reference and the arbitration proceedings shall be made in that Court and in no other Court.

SECTION 32: BAR TO SUITS CONTESTING ARBITRATION AGREEMENT OR AWARD

- Notwithstanding any law for the time being in force, no suit shall lie on any ground whatsoever for a decision upon the existence, effect or validity of an arbitration agreement or award, nor shall any arbitration agreement or award bea[enforced,] set aside, amended, modified or in any way affected otherwise than as provided in this Act.

SECTION 33: ARBITRATION AGREEMENT OR AWARD TO BE CONTESTED BY APPLICATION

- Any party to an arbitration agreement or any person claiming under him desiring to challenge the existence or validity of an arbitration agreement or an award or to have the effect of either determined shall apply to the Court and the Court shall decide the question on affidavits: Provided that where the Court deems it just and expedient, it may set down the application for hearing on other evidence also, and it may pass such orders for discovery and particulars as it may do in a suit.

SECTION 34: POWER TO STAY LEGAL PROCEEDINGS WHERE THERE IS AN ARBITRATION AGREEMENT

- Where any party to an arbitration agreement or any person claiming under him commences any legal proceedings against any other party to the agreement or any person claiming under him in respect of any matter agreed to be referred, any party to such legal proceedings may, at any time before filing a written statement or taking any other steps in the proceedings, apply to the judicial authority before which the proceedings are pending to stay the proceedings; and if satisfied that there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement and that the applicant was, at the time when the proceedings were commenced, and still remains, ready and willing to do all things necessary to the proper conduct of the arbitration, such authority may make an order staying the proceedings.

SECTION 35: EFFECT OF LEGAL PROCEEDINGS ON ARBITRATION

- (1) No reference nor award shall be rendered invalid by reason only of the commencement of legal proceedings upon the subject- matter of the reference, but when legal proceedings upon the whole of the subject-matter of the reference have been commenced between all the parties to the reference and a notice thereof has been given to the arbitrators or umpire, all further proceedings in a pending reference shall, unless a stay of proceedings is granted under S. 34, be invalid.

(2) In this section the expression "parties to the reference" includes any persons claiming under any of the parties and litigating under the same title.

SECTION 36: POWER OF COURT, WHERE ARBITRATION AGREEMENT IS ORDERED NOT TO APPLY TO A PARTICULAR DIFFERENCE, TO ORDER THAT A PROVISION MAKING AN AWARD A CONDITION PRECEDENT TO AN ACTION SHALL NOT APPLY TO SUCH DIFFERENCE

- Where it is provided (whether in the arbitration agreement or otherwise) that an award under an arbitration agreement shall be a condition precedent to the bringing of an action with respect to any matter to which the agreement applies, the Court, if it orders (whether under this Act or any other law) that the agreement shall cease to have effect as regards any particular difference, may further order that the said provision .shall also cease to have effect as regards that difference.

SECTION 37: LIMITATIONS

- (1) All the provisions of the Indian Limitation Act, 1908shall apply to arbitrations as they apply to proceedings in Court.

(2) Notwithstanding any term in an arbitration agreement to the effect that no cause of action shall accrue in respect of any matter required by the agreement to be referred until an award is made under the agreement, a cause of action shall, for the purpose of limitation, be deemed to have accrued in respect of any such matter at the time when it would have accrued but for that term in the agreement.

(3) For the purposes of this section and of the Indian Limitation Act, 1908an arbitration shall be deemed to be commenced when one party to the arbitration agreement serves on the other parties thereto a notice requiring the appointment of an arbitrator, or where the arbitration agreement provides that the reference shall be to a person named or designated in the agreement, requiring that the difference be submitted to the person so named or designated.

(4) Where the terms of an agreement to refer future differences to arbitration provide that any claims to which the agreement applies shall be bared unless notice to appoint an arbitrator is given or an arbitrator is appointed or some other step to commence arbitration proceedings is taken within a time fixed by the agreement, and a difference arises to which the agreement applies the Court, if it is of opinion that in the circumstances of the cases undue hardship would otherwise be caused, and notwithstanding that the time so fixed has expired, may on such terms, if any, as the justice of the case may required, extend the time for such period as it thinks proper.

(5) Where the Court orders that an award be set aside or orders, after the commencement of an arbitration, that the arbitration agreement shall cease to have effect with respect to the difference referred, the period between the commencement of the arbitration and the date of the order of the Court shall be excluded in computing the time prescribed by the Indian Limitation Act, 1908 for the commencement of the proceedings (including arbitration) with respect to the difference referred.

SECTION 38: DISPUTES AS TO ARBITRATOR'S REMUNERATION OR COSTS

- (1) If in any case an arbitrator or umpire refuses to deliver his award except on payment of the fees demanded by him, the Court may, on an application in this behalf, order that the arbitrator or umpire shall deliver the award to the applicant on payment into Court by the applicant of the fees demanded, and shall, after such inquiry, if any, as it thinks fit, further order that out of the money so paid into Court there shall be paid to the arbitrator or umpire by way of fees such sum as the Court may consider reasonable and that the balance of the money, if any, shall be refunded to the applicant.

(2) An application under Sub-section (1) may be made by any party to the reference unless the fees demanded have been fixed by written agreement between him and the arbitrator or umpire, and the arbitrator or umpire shall be entitled to appear and be heard on any such application.

(3) The Court may make such orders as it thinks fit respecting the costs of an arbitration where any question arises respecting such costs and the award contains .no sufficient provision concerning them.

CHAPTER 06: APPEALS

SECTION 39: APPEALABLE ORDERS

(1) An appeal shall lie from the following orders passed under this Act (and from no others) to the Court authorised by law to hear appeals from original decree of the Court passing the orders:- An order-

(i) superseding an arbitration;

(ii) on an award stated in the form of a special case;

(iii) modifying or correcting an award:

(iv) filing or refusing to file an arbitration agreement;

(v) staying or refusing to stay legal proceedings where there is an arbitration agreement:

(vi) setting aside or refusing to set aside an award ; Provided that the provisions of this section shall not apply to any order passed by a Small Cause Court.

(2) No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall affect or take away any right to appeal to a[the Supreme Court].

CHAPTER 07: MISCELLANEOUS

SECTION 40: SMALL CAUSE COURT NOT TO HAVE JURISDICTION OVER ARBITRATIONS SAVE ARBITRATIONS IN SUITS BEFORE IT

- A Small Cause Court shall have no jurisdiction over any arbitration proceedings or over any application arising thereout save on application made under section 21-

SECTION 41: PROCEDURE AND POWERS OF COURT

Subject to the provisions of this Act and of rules made thereunder-

(a) the provisions of the Code of Civil Procedure, 1908-, shall apply to all proceedings before the Court, and to all appeals, under this Act, and

(b) the Court shall have, for the purpose of, and in relation to, arbitration proceedings, the same power of making orders in respect of any of the matters set out in the Second Schedule as it has for the purpose of, and in relation to, any proceedings before the Court: Provided that nothing in clause (b) shall be taken to prejudice any power which may be vested in an arbitrator or umpire for making orders with respect to any of such matters.

SECTION 42: SERVICE OF NOTICE BY PARTY OR ARBITRATOR

- Any notice required by this Act to be served otherwise than through the Court by a party to an arbitration agreement or by an arbitrator or umpire shall be served in the manner provided in the arbitration agreement, or if there is no such provision, either-

(a) by delivering it to the person on whom it is to be served, or

(b) by sending it by post in a letter addressed to that person at his usual or last known place of abode or business in a[India] and registered under Chapter 6 of the Indian Post Office Act, 1898-.

SECTION 43: POWER OF COURT TO ISSUE PROCESSES FOR APPEARANCE BEFORE ARBITRATOR

(1) The Court shall issue the same processes to the parties and witnesses whom the arbitrator or umpire desires to examine as the Court may issue in suits tried before it.

(2) Person failing to attend in accordance with such process, or making any other default, or refusing to give their evidence, or guilty of any contempt to the arbitrator or umpire during the investigation of the reference, shall be subject to the like disadvantages, penalties and punishments by order of the Court on the representation of the arbitrator or umpire as they would incur for the like offences in 'suits tried before the Court.

(3) In this section the expression "processes" includes summonses and commissions for the examination of Witnesses and summonses to produce documents.

SECTION 44: POWER TO HIGH COURT TO MAKE RULES

- The High Court may make rules a consistent with this Act as to-

(a) the filing of awards and all proceedings consequent thereon or incidental thereto;

(b) the filing and hearing of special cases and all proceedings consequent thereon or incidental thereto;

(d) the forms to be used for the purposes of this Act;

(e) generally, all proceedings in Court under this Act.

SECTION 45: GOVERNMENT TO BE BOUND

- The provisions of this Act shall be binding on the a[Government].

SECTION 46: APPLICATION OF ACT TO STATUTORY ARBITRATION

The provisions of this Act, except sub-section (1) of Section 6-andSections 7-,12-,a[36-] and37-, shall apply to every arbitration under any other enactment for the time being in force, as if the arbitration were pursuant to an arbitration agreement and as if that other enactment were-in arbitration agreement, except in so far as this Act is inconsistent with that other enactment or with any rules made there under.

SECTION 47: ACT TO APPLY TO ALL ARBITRATIONS

- Subject to the provisions of section 46-, and save in so far as is otherwise provided by any law for the time being in force, the provisions of this Act shall apply to all arbitrations and to all proceedings there under:
Provided that an arbitration award otherwise obtained may with the consent of all the parties interested be taken into consideration as a compromise or adjustment of a suit by any Court before which the suit is pending. -

SECTION 48: SAVING FOR PENDING REFERENCES

- The provisions of this Act shall not apply to any reference pending at the commencement of this Act, to which the law in force immediately before the commencement of this Act shall, notwithstanding any repeal effected by this Act, continue to apply.

SECTION 49: REPEALS AND AMENDMENTS

].- Repealed by the Repealing and Amending Act, 1945 (6 of 1945), S. 2 and Sch.. 1 (16-4-45).

SCHEDULE 01: THE FIRST SCHEDULE

(See Section 3-) IMPLIED CONDITIONS OF ARBITRATION AGREEMENTS 1. Unless otherwise expressly provided, the reference shall be to a sole arbitrator. 2. If the reference is to an even number of arbitrators, the arbitrators shall appoint an umpire not later than one month from the latest date of their respective appointments. STATE AMENDMENT Uttar Pradesh In its application to the State of Uttar Pradesh, in the First Schedule, para. 2, for the words " not later than one month from the latest date of their respective appointments", substitute the words "within one month from the latest date of their respective appointments or within such extended time as the parties to the reference agree to, an In the absence of such agreement, as the Court may allow," -U. P. Act 57 of 1976, S. 24(a) (1-1-1977). 3. The Arbitrators shall make their award within four months after entering on the reference or after having been called upon to act by notice in writing from any party to the arbitration agreement or within such extended time as the Court may allow. STATE AMENDMENT Uttar Pradesh In its application to the State of Uttar Pradesh, in the First Schedule, in paragraph 3. for the words "or within such extended time as the Court may allow" substitute the words "or within such extended time as the parties to the reference agree to, and in the absence of such agreement, as the court may allow". -U.P. Act 57 of 1976, S.24(b)(1-1-1977). 4. If the arbitrators have allowed their time to expire without making an award or have delivered to any party to the arbitration agreement or to the umpire a notice in writing staling that they cannot agree, the umpire shall forthwith enter on the reference in lieu of the arbitrators. 5. The umpire shall make his award within two months of entering on the reference or within such extended time as the Court may allow. STATE AMENDMENT Uttar Pradesh In its application to the state of Uttar Pradesh, in the First Schedule, in para. 5, for the words "or within such extended time as the Court may allow", substitute the words "or within such extended time as the parties to the reference agree to, and in the absence of such agreement, as the Court may allow". -U. P. Act 57 of 1976, S. 24(c) (1-1- 1977). 6. The parties to the reference and all persons claiming under them shall, subject to the provisions of any law for the time being in force, submit to be examined by the arbitrators or umpire on oath or affirmation in relation to the matters in difference and shall, subject as aforesaid, produce before the arbitrators or umpire all books, deeds, papers, accounts, writings and documents within their possession or power respectively, which may be required or called for, and do all other things which, during the proceedings on the reference, the arbitrators or umpire may require. 7. The award shall be final and binding on the parties and persons claiming under them respectively.

SCHEDULE 02: THE SECOND SCHEDULE

(See Section 41-) POWERS OF COURT 1. The preservation, interim custody or sale of any goods which are the subject-matter of the reference. 2. Securing the amount in difference in the reference. 3. The detention, preservation or inspection of any property or thing which is the subject of the reference or as to which any question may arise therein and authorising for any of the aforesaid purposes any person to enter upon or into any land or building in the possession of any party to the reference, or authorising any samples to be taken or any observation to be made, or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full information or evidence. 4. Interim injunctions or the appointment of a receiver. 5. The appointment of a guardian for a minor or person of unsound mind for the purposes of arbitration proceedings.

SCHEDULE 03: THE THIRD SCHEDULE

.- [Enactments repealed.] Repealed by the Repealing and Amending Act, 1945 (6 of 1945), S.2 and Sch. 1 (16-4-45).

SCHEDULE 04: THE FOURTH SCHEDULE

.- [Enactments amended.] Repealed by the Repealing and Amending Act, 1945 (6 of 1945), S. 2 and Sch. 1 (16-4-1945).

RULES OF ARBITRATION OF THE INDIAN COUNCIL OF ARBITRATION

ICA ARBITRATION CLAUSE These rules provide among other things the procedure to be followed by the parties to the Arbitration, the fees of the Arbitrators and other fees to be paid by the parties. The Indian Council of Arbitration recommends to all parties desirous of making reference to arbitration of the Indian Council of Arbitration the use of the following arbitration clause in their contracts: "All disputes or differences whatsoever arising between the parties out of or relating to the construction, meaning and operation or effect of this contract or the breach thereof shall be settled by arbitration in accordance with the Rules of Arbitration of the Indian Council of Arbitration and the award made in pursuance thereof shall be binding on the parties".

RULE 01:

These Rules may be called the Rules of Arbitration of the Indian Council of Arbitration. (ICA Rules)

PART 01: DEFINITIONS

ARBITRATION COMMITTEERULES APPLICABLEINTERPRETATION OF THE RULESPANEL OF ARBITRATORSDUTIES OF THE REGISTRARINITIATION OF ARBITRATIONDEFENCE STATEMENTCOUNTER CLAIM AND REPLY TO COUNTERCLAIMCOPIES OF STATEMENTS, ETC.CONSTITUTION OF THE BENCHDEPOSITSFEES AND EXPENSESSUBMISSION OF THE CASE TO THE BENCHNOTIFICATIONS AND/OR COMMUNICATIONS FROM THE REGISTRARAMENDMENT OF CLAIMS, ETC.PLACE OF ARBITRATIONPROCEEDINGS BEFORE THE BENCHWAIVER OF RULESRETURN OF DOCUMENTSAWARDSFILING OF AWARDSTAMP DUTIESCOPIES OF PROCEEDINGSCASE WITHDRAWNINDEMNITY OF SECRETARIAT AND ARBITRATORSAMENDMENT OF RULES

RULE 02:

In these Rules, the following words have the following meanings:

(i) "Council" means the Indian Council of Arbitration.

(ii) "Committee" means the Arbitration Committee of the Council as provided for hereinafter.

(iii) "Rules" means the Rules of Arbitration of the Council.

(iv) "Governing Body" means the Governing Body for the time being of the Council.

(v) "Bench" means the arbitrator or arbitrators appointed for determining a particular dispute or difference.

(vi) "Panel" means the panel of arbitrators maintained by the Council.

(vii) "Court" means a Civil Court having jurisdiction to decide the questions forming the subject matter of the reference, if the same had been the subject matter of a suit.

(viii) "Reference" means a submission or a reference of a difference or dispute, to arbitration under the rules of the Council.

(ix) "Domestic Arbitration" means an arbitration between panics in India.

(x) "International Arbitration" means an arbitration between a party in India and a party in a foreign country or between foreign parties.

(xi) "Small Claims Arbitration" means an arbitration between parties in India where the value of the claim and the counter-claim in the dispute taken together does not exceed Rs. 50.000.

(xii) "Party" shall include any individual, firm, company, Government, Government organisation or Government Undertaking.

(xiii) "Registrar" means the Registrar appointed by the Committee and includes such other persons as the Committee may nominate for carrying out the duties of the Registrar under these rules. The Committee may also nominate an Additional Registrar to discharge such of the functions and administrative duties of the Registrar as may be delegated to him from time to time with reference to a particular case or cases.

(xiv) "Guidelines" means the guidelines for arbitrators and the parties to arbitration for expeditious conduct of the arbitration proceedings given in Annexure 'A' at the end of these Rules.

(xv) Words importing the singular number include, where the context admits or requires, the plural numbers and vice versa.

RULE 03:

These Rules are in three parts. Part I, Part II and Part III. Unless the parties have agreed otherwise:

(a) The Rules set out in Part I shall apply to all Domestic Arbitration. These will also apply to International and Small Claims arbitrations to the extent they are not inconsistent with the Rules contained in Part II and Part III respectively.

(b) The Rules set out in Part II shall apply only to International Arbitrations.

RULE 04:

If the parties fail to agree on the nature of the arbitration referred to the Council, the Chairman of the Arbitration Committee or if the power is delegated to the Registrar, the Registrar shall determine whether the arbitration is a Domestic, International or Small Claims arbitration and such decision will be Final and binding on the parties.

RULE 05:

(a) The Governing Body of the Council shall constitute an Arbitration Committee for performing the functions prescribed under these rules. The Committee shall consist of the President of the Council, who shall be the ex-officio Chairman of the Committee and three members of the Governing Body of the Council elected by the Governing Body from amongst themselves The Committee shall hold office for a year.

(b) The Committee may co-opt not more than two persons to be additional members of the Committee during its term of office. Persons who are not members of the Governing Body may also be co-opted to be members of the Committee.

(c) The Committee or the Chairman of the Committee may delegate to the Registrar the power to take certain decisions provided that any such decision shall be reported to the Chairman or the Committee as the case may be.

RULE 06:

(a) Any dispute or difference relating to commercial matters including shipping, sale, purchase, banking, insurance, building construction, engineering, technical assistance, know-how, patents, trade marks, management consultancy, commercial agency, labour, etc. arising between parties in India or a party in India and a party in a foreign country or between foreign parties who agree or have agreed for arbitration by the Council, or under the Rules of Arbitration of the Council, shall be determined and settled in accordance with these Rules.

(b) The Council shall also be competent to administer the conduct of arbitration in any dispute or difference relating to a commercial transaction between parties as mentioned in sub-clause (a) where they have agreed to arbitrate their dispute under any other Rules of Arbitration or otherwise and have agreed to have such arbitration administered by the Council, wholly or in respect of some matters arising out of such arbitration.

(c) The Council shall also be competent to function as Appointing Authority as contemplated under the Arbitration Rules of the United Nations Commission on International Trade Law. (UNCITRAL)

RULE 07:

Wherever the parties have provided or agreed for arbitration by the Indian Council of Arbitration or for arbitration under the Rules of Arbitration of the Council, these Rules or any amendment thereof in the form obtaining at the time the dispute is referred to arbitration of the Council shall apply.

RULE 08:

If one or both the parties to a dispute referred for arbitration to the Council belong to a country or countries other than India, in the absence of an agreement by the parties on the substantive law to be applied, it will be determined by the Bench. The procedural law shall be governed by the laws of India and parties shall be deemed to have submitted to the jurisdiction of the Courts in India.

RULE 09:

Any chamber of commerce, trade association or any arbitral or other organisation may adopt these Rules by making them generally available to its members or by applying them to any dispute in which any of its members may be parties or by normally conducting its arbitration under these Rules.

RULE 10:

The decision of the Committee on questions relating to interpretation of the Roles or any procedural matters thereunder shall be final and binding on the parties.

RULE 11:

A Panel of arbitrators shall be appointed by the Committee from amongst persons who are qualified and willing to serve as arbitrators generally or in specific fields and who are from time to time recommended by the members of the Council or any other person or organisation.

RULE 12:

The Registrar shall prepare and maintain an uptodate Panel of arbitrators together with adequate information as to their qualifications and experience. Separate lists may be kept and maintained of arbitrators included in the Panel for disputes in general and for each of the fields of international trade and/or business transactions in which the Governing Body decides that the Council will offer arbitration facilities under the Rules. The parties to a dispute or the Registrar where he appoints the arbitrator may choose any person from the Panel with reference to any dispute. If any party appoints a foreigner, residing abroad, as arbitrator from the Panel, the party will have to meet the travel expenses of the person appointed as arbitrator from his country to the place of arbitration. The Bench may, however, make any order in regard thereto in the award. The Panel of arbitrators shall be open to inspection by all persons with the permission of the Registrar.

RULE 13:

The Committee may at any time add the name of any person to the list of arbitrators included in the Panel or delete the name of any person from the Panel.

RULE 14:

The Chairman of the Committee may include the name of any person in the Panel, in case it is required in any particular case. His continuance in the Panel will be decided by the Committee.

RULE 15:

(a) The Registrar shall receive applications for arbitration by the Council, receive payment of fees and deposits, appoint in consultation with the Chairman of the Committee and in his absence in consultation with the member of the Governing body designated by him, an arbitrator or arbitrators as hereinafter provided, receive all communications made to the Bench by the parties and communicate to them the orders and directions of the Bench, keep a register of applications to the Council and of awards made by the Bench, keep such other books or memoranda and make such other returns as the Committee shall from time to lime require and generally carry out the directions of any Bench so constituted and take such other steps as may be necessary to assist any such Bench in the execution of its functions.

(b) The Registrar may delegate to any officer of the Council/Chamber of Commerce/trade association etc. to discharge such of the functions and administrative duties of the Registrar as are deemed proper and necessary from time to time, with reference to a particular case or cases.

RULE 16:

Any party wishing to commence arbitration proceedings under these Rules (claimant) shall submit to the Registrar a written request (application) for arbitration which shall include or be accompanied by:

(a) The names in full of the parties to the dispute and their addresses.

(b) A claim statement containing full details of the claimant's case.

(c) Original (or photostat copies) of the arbitration agreement, any contract or agreement out of or in connection with which the dispute has arisen and such other documents and information relevant or relied upon.

(d) Registration fee of Rs. 100 [Rule 32(1)-].

RULE 17:

If any Court makes an order directing that an arbitration be held under these Rules, in addition to the documents listed inrule 16-the order of that Court or a copy thereof shall accompany the application for arbitration.

RULE 18:

(a) On receipt of an application for arbitration, the Registrar shall have absolute discretion to accept or reject the said application. The Registrar is not bound to give reasons for the exercise of his discretion. Before deciding on the acceptability of an application for arbitration, the Registrar may ask the parties for further information and particulars of their claims.

(b) Similarly, if any information or particulars regarding the arbitration agreement furnished by the claimant with the application for arbitration-are found to be incorrect or false, at any time subsequently, the Registrar shall have a like power to reject the application for arbitration.

(c) Any party aggrieved by the decision of the Registrar in accepting or rejecting an application for arbitration as above, may apply to the Court for suitable directions.

RULE 19:

(a) On receipt of the application together with the claim statement, the Registrar shall send to the other party (defendant) a copy of the claim statement and attach documents and ask such other party to furnish within the date specified or within any extended date, a defence statement setting out his case accompanied by all documents and information in support of or bearing on the matter.

(b) Any communication sent by the Registrar under Registered Post to the Defendant on the address appearing in the Arbitration Agreement/the contract between the parties, as per the information supplied to the Council, will be deemed to be duly served on the Defendant, even if the Defendant refuses to accept the said communication or it is returned to the Council by the postal authorities as unclaimed by the said party. The Registrar may proceed further with the arbitration proceedings as per the Rules as if the above communication had been duly served on the concerned parties. The Registrar may in such cases make an additional communication to the parties by Registered letter or through publication of a notice in a Newspaper or any other suitable means.

RULE 20:

(a) The defendant may make a counter-claim against the claimant provided the counter-claim arises under the same transaction as the original claim. He must submit the counter-claim with full details supported by all documents and information as in the case of the claim underRule 16-within the period laid down for the defence statement to the claim and the claimant may within twentyone days of the notification of the counter-claim or within such extended time submit a statement in reply to the counter-claim. The Bench appointed to adjudicate upon the original claim shall also adjudicate upon the counter-claim.

(b) Copy of the reply of the claimant to the counter claim and all appended documents, if any, shall be sent to the defendant for information.

RULE 21:

All statements, replies and other documents and papers submitted by the parties and all appended documents must be supplied in triplicate. Where there is more than one arbitrator or more than one opposing party, the parties shall within the time specified furnish to the Registrar such number of further copies as may be required by the Registrar.

RULE 22:

On receipt of the application for arbitration, the Registrar shall take necessary steps to have the Bench constituted for the adjudication of the dispute or difference as provided hereunder.

RULE 23:

The number of arbitrators to hear a dispute shall be either one or three to be determined as under:

(a) Where the claim does not exceed Rs. 5 lakhs, and where the arbitration agreement does not specify three arbitrators the reference shall be deemed to be a sole arbitrator, unless the parties to the dispute agree to refer the dispute to three arbitrators within thirty days from the date of notification of the request for arbitration or within such extended time or where the Registrar in his discretion thinks that an adjudication by three arbitrators is preferable in the particular case.

(b) Where the claim exceeds Rs. 5 lakhs, the dispute will be heard and determined by three arbitrators, unless the parties to the dispute agree to refer the dispute to a sole arbitrator within thirty days from the date of the notification of the request for arbitration or within such extended time.

(c) Where three arbitrators have to be appointed as per the above Rule and any of the parties to the dispute fails to make the necessary deposit towards the costs and expenses of arbitration, instead of three arbitrators, the Registrar may appoint a sole arbitrator, irrespective of the value of the claim.

RULE 24:

The appointment of sole arbitrator or three arbitrators shall be made in the following manner:

(a) In case a sole arbitrator has to be appointed, the Registrar shall call upon the parties to the dispute to forward the name of an agreed arbitrator from among the Panel of arbitrators by a notice in writing sent to them. The said notice shall specify the period within which the nomination shall be made which shall not be less than thirty days from the date of the said notice to the respective parties. If the parties fail to agree on the person to be appointed as sole arbitrator within the time granted by the Registrar, the Registrar in consultation with the Chairman of the Committee and in his absence in consultation with the member of the Governing Body designated by the Chairman, appoint the sole arbitrator from among the Panel of arbitrators. If one of the parties is a national or resident of a country other than India, the sole arbitrator shall as far as possible be chosen or appointed by the Registrar from among the nationals of a country other than that of any of the parties. The sole arbitrator so nominated shall constitute the Bench to hear the dispute and shall be appointed as such m writing by the Registrar. The Registrar shall give notice to the parties of the constitution of the Bench.

(b) Where the reference is to three arbitrators, the Registrar shall in the first instance call upon the parties to the dispute to nominate one arbitrator each from among the Panel of arbitrators by a notice in writing sent to them. The said notice shall specify the period within which the nomination shall be made which shall not be less than twenty-one days from the date of the said notice to the respective parties. If a party to the dispute refuses or neglects to appoint an arbitrator on his behalf within the period specified or any extended period or if he requests the Registrar to nominate an arbitrator on his behalf, the Registrar shall nominate an arbitrator on behalf of that party from among the persons then constituting the Panel of arbitrators in consultation with the Chairman of the Committee and in his absence in consultation with the member of the Governing Body designated by the Chairman. On receipt of the nominations from the respective parties or on the appointment as aforesaid by the Registrar, the Registrar shall appoint another person in consultation with the Chairman of the Committee and in his absence in consultation with the member of the Governing Body designated by the Chairman, from among the Panel of arbitrators to be an additional arbitrator. If one of the parties is a national or resident of a country other than India, the additional arbitrator shall as far as possible be chosen or appointed from among the nationals of a country other than that of any of the parties. The arbitrators so nominated or appointed shall constitute the Bench and shall be appointed as such in writing by the Registrar. The additional arbitrator nominated by the Registrar shall be the Chairman of the Bench. The Registrar shall give notice to the parties of the constitution of the Bench.

RULE 25:

The consent to act as arbitrator shall be obtained by the Registrar from the persons nominated by him or by the parties.

RULE 26:

Before accepting his nomination, the prospective arbitrator shall disclose any circumstances such as financial or personal interest in the outcome of the award, likely to disqualify him as an impartial arbitrator. Upon receipt of such information, the Registrar shall disclose it to the parties, who if willing to proceed under the circumstances disclosed, shall advise the Registrar accordingly. If either party declines to waive the presumptive disqualification, the prospective arbitrator shall be disqualified from acting as arbitrator and the vacancy so created shall be filled in accordance with the applicable provision of these Rules.

RULE 27:

Any party shall have the right to challenge the appointment of an arbitrator on receipt of the notice of his appointment for reasons which disqualify the arbitrator. The challenge of an arbitrator shall be made within 30 days after his appointment has been communicated to the challenging party or within 30 days of his becoming aware of the reasons for which the challenge is made. Copies of the communication of challenge shall be sent to the other parties and the arbitrators. The Committee shall be the sole judge of the grounds of challenge and its decision shall be final and binding on the parties.

RULE 28:

(a) If any appointed arbitrator neglects or refuses to act within twenty-one days or within such extended time of his being required to act or dies or becomes incapable of acting or resigns .or ceases to function consequent upon a challenge or fails to act for any other reason any time during the arbitration proceedings, the Registrar, in case he has appointed the arbitrator, shall appoint another arbitrator in his place. Where the appointment is by the parties, the Registrar shall call upon the party who has appointed the arbitrator to nominate another arbitrator. If any of the parties refuses or neglects to nominate an arbitrator within twenty-one days of the date of the notice requiring the party to nominate an arbitrator or within such extended time or the party requests the Registrar to appoint an arbitrator on his behalf, the Registrar shall nominate an arbitrator on behalf of that party from among the panel of arbitrators in consultation with the Chairman of the Committee or members of the Governing Body designated by the Chairman.

"The decision of the Committee that an appointed arbitrator has become incapable of acting shall be final and conclusive for the purpose of this Rule.

(b) The Bench as reconstituted shall proceed with the arbitration with liberty to act on the record of proceedings as then existing and on the evidence, if any, then taken in the arbitration or commence proceedings de novo.

RULE 29::

The Registrar may require the parties before passing the case on to the arbitrators underrule 39-, to deposit in advance in one or more instalments such sums of money as he deems necessary to defray expenses of the arbitration including the administrative charges and arbitrator's fee. As a general rule, the deposits shall be called for in equal shares from the claimant(s) and the defendant(s). The Bench may during the course of the arbitration proceedings or in the arbitration award, require further sums to be deposited by the parties or any one of them to meet the expenses of the arbitration. When one of the parties neglects or refuses to make the deposit, the Registrar or the Bench as the case may be, may require such deposit, whether in relation to a claim or a counter-claim to be made by the other party to the dispute (claimant or defendant, as the case may be). Should the whole or part of the deposit be not made by the parties or any one of them, the Registrar shall inform the parties or the party concerned that the claim or counter-claim, as the case may be, will not be the subject matter of the reference. The Bench shall proceed only in respect of those claims or counter-claims for which the deposit has been duly paid to the Council and otherwise may order the suspension or termination of the arbitral proceedings. The deposits made shall be taken into account by the Bench in apportioning the costs while making the award. Any deposits made in excess shall be refunded to such of the parties as the Bench may direct.

RULE 30:

The Bench shall be entitled to allow fees and expenses of witnesses, expenses connected with the selection and carriage of sample and examination of goods. Licensed Measure's Department charges, conveyance, hire, cost of legal or technical advice or proceedings in respect of any matter arising out of the arbitration incurred by the Bench, and any other incidental expenses and charges in connection with or arising out of the reference or award as the Bench shall in its absolute discretion think fit.

RULE 31:

The costs of the reference and the award including charges, fees and other expenses shall be in the discretion of the Bench, which may direct to them and by whom, and in what manner and in what proportion such charges, fees and other expenses and any part thereof shall be borne and paid, and may tax and settle the amount of costs to be so paid or any part thereof and may award costs to be paid as between solicitor and client. In the event any administrative fees and expenses are due to the Council, the Bench may award them in favour of the Council.

RULE 32:

The fees, costs and expenses incidental to the reference and the award shall include the following:

(1) Registration Fee.-A registration fee of Rs.100 shall be paid along with the application for reference. The registration fee will not be returned and becomes the property of the Council.

(2) Administrative Fee.-The administrative fee will be fixed by the Bench in each case within the limits given hereunder having regard to the nature of the case and the time taken to decide it. Where the amount of claim is: From Rs. 50,001 to Rs. 600 to Rs. 1250 Rs. 1,00,000 From Rs. 1,00,001 to Rs. 1000 to Rs. 2500 Rs. 5,00,000 From Rs. 5,00,001 to Rs. 2000 to Rs. 5000 Rs. 10,00,000 From Rs. 10,00,001 to Rs. 4000 to Rs. 6000 Rs. 25,00,000 From Rs. 25,00,001 to Rs. 5000 to Rs. 8000 Rs. 50,00,000 From Rs. 50,00,001 to Rs. 6000 to Rs. 12,000 Rs. 1,00,00,000 Over Rs. 1,00,00,000 Such amount exceeding Rs-12,000 as may be fixed by the Bench in each case.

(3) Arbitrator's fees.-The arbitrator's fee will be fixed by the Bench in each case within the limits given hereunder having regard to the nature of the case and the time taken to decide it. For each arbitrator, where the amount of claim is: From Rs. 50,001 to Rs. 1000 to Rs. 1500 Rs. 1,00,000 From Rs. 1,00,001 to Rs. 1250 to Rs. 3000 Rs. 5,00,000 From Rs. 5,00,001 to Rs. 2500 to Rs. 6000 Rs. 10,00,000 From Rs. 10,00,001 to Rs. 5000 to Rs. 8000 Rs. 25,00,000 From Rs. 25,00,001 to Rs. 6000 to Rs. 10,000 Rs. 50,00,000 From Rs. 50,00,001 to Rs. 7000 to Rs. 15,000 Rs. 1,00,00,000 Over Rs. 1,00,00,000 Such amount exceeding Rs. 15,000 as may be fixed by the Bench in each case.

(4) Notwithstanding the provisions in sub-rules (2) and (3) of this Rule, the Committee/Chairman of the Committee may prescribe the arbitrator's fees and the administrative fees of the Council at a figure higher than those prescribed in the said sub-rules, if in the exceptional circumstances of the case this appears to be necessary. The Bench will fix the arbitrator's fees and the administrative fees within or at the maximum amounts prescribed by the Committee/Chairman.

(5) Notwithstanding the provisions in sub-rules (2) and (3) of this rule, in applications in whichrule 40-applies the Chairman of the Committee/ Committee may prescribe the arbitrator's fees and the administrative fees of the Council in appropriate slabs or in any other manner having regard to the nature and facts of the reference. The Bench will fix the arbitrator's fees and the administrative fees, having regard to the slabs/amounts prescribed by the Committee/Chairman.

RULE 33: OTHER EXPENSES

-In addition to the above fees and expenses, any travelling and other expenses incurred by the arbitrator or the Registrar shall be included in the arbitration costs and shall be payable as determined by the Bench.

RULE 34:

An arbitrator who has to travel shall be paid travelling expenses by air or rail (air conditioned wherever available) or car when neither air nor rail transport is available at actuals. In addition, he may be paid out-of-pocket expenses at actuals for boarding, lodging and local transport subject to a maximum of Rs. 500 per day. An arbitrator who makes his own arrangements for boarding, lodging, local transport etc. may be paid out of pocket expenses at the rate of Rs. 350 per day, without production of voucher.

RULE 35:

Where the arbitration proceedings under an ad hoc arbitration or under the rules of arbitration of any other arbitral organisation or otherwise are administered by the Council wholly or in respect of some matters arising out of such arbitration, the Council may charge an appropriate fee for such administration and other services.

RULE 36:

The amount of the claim shall be stated in the application by the party applying for arbitration. If the amount is stated in a currency other than the rupee, it shall be converted into rupees, at the current official rate of exchange.

RULE 37:

Where the sum under dispute is not stated or in arbitration proceedings where the relief claimed is other than a money claim, viz. a declaratory claim, the Registrar and the Bench underrule 29-, may require such deposits as may be deemed necessary to be payable by such of the parties as may be required subject to later adjustment.

RULE 38:

The provisions relating to fees, costs and expenses in sub-rules (2) to (5) ofrule 32-above in relation to a claim will apply also to the amount of counter-claim or set-off and the Registrar or the Bench, underrule 29-, may require such deposits as may be deemed necessary in respect of the counter claim or set-off to be paid by such of the parties as may be required subject to later adjustment.

RULE 39:

The Registrar shall send copies of all papers, claim statement, defence statement, counter-claims, replies, statements, documents etc. received from the parties to the dispute to the arbitrator/arbitrators constituting the Bench underrule 24-with a request to proceed with the arbitration and the Bench shall be deemed to have entered on the reference on the-day on which applications, defence statement, counterclaims, replies, documents, etc. have been despatched to the arbitrator/arbitrators. Intimation shall be given to the parties of the day on which the Bench is deemed to have entered on the reference. If the claimant does not file all the documents, papers, information, etc. or does not deposit the appropriate registration fees as per the Rules after having been given due opportunity for the purpose by the Registrar or the Bench, the Registrar or the Bench may dismiss/close the case on file for lack of purusual by the claimant. Similarly, if the defendant fails to produce any documents, papers or information or deposit arbitration fees, etc. after having been given due opportunity for the purpose by the Registrar or the Bench, the Registrar or the Bench may proceed further with the arbitration proceedings as per the Rules, notwithstanding such failure or refusal by the defendant.

RULE 40:

Where there are two or more applications for arbitration referred to the Council and the issues involved in the dispute arise out of same or similar transactions, the Registrar may, if he thinks proper to do so and with the consent of the parties, fix the hearings of the disputes to be held jointly or refer the applications to the same Bench. The awards, however, shall be given separately in each case.

RULE 41:

All applications which the parties desire to make to the Bench and all notices to be given to the parties before or during the course of arbitration or otherwise in relation thereto shall be made through and sent by the Registrar who shall communicate the orders and directions of the Bench thereon to the parties.

RULE 42:

Amendments of the claim, defence statement, counter-claim or reply submitted to the Bench must be formulated in writing by the party so desiring. The Bench will decide whether such amendments should be allowed or not.

RULE 43:

The place or venue of arbitration shall be India. The arbitration proceedings shall be held at such place or places in India as the Bench may determine having regard to the convenience of the arbitrators and the parties. In a case in which one or both the parties are from overseas, the arbitration proceedings may also be held at any place outside India at the discretion of the Bench.

RULE 44:

The Bench may decide the reference on the written pleadings and the documents accompanying them if the parties so request or agree. If one of the parties requests for a hearing or the Bench on its own decides that the dispute shall be settled after hearing the parties, the parties shall be heard. The Bench shall have power to call for any further documents or things and take any oral evidence, if necessary. When there is a hearing the Registrar shall intimate the parties the date, time and place of the hearing. At the first hearing the Bench will ascertain from the parties whether they wish to have a reasoned award and if both parties indicate their agreement, the award will contain the reasons.

RULE 45:

At a hearing a party shall be entitled to appear by counsel, attorney, advocate or a duly authorised adviser or representative or personality.

RULE 46:

The Bench may proceed with the reference notwithstanding any failure by a party or parties to comply with any of the directions of the Bench and may also proceed with the reference in the absence of any or both the parties who fail or neglect to attend at the time and place appointed by the Bench.

RULE 47:

The parties shall do all acts necessary to enable the Bench to make an award expeditiously and shall not do or cause or allow to be done any act to delay the proceedings or to prevail the Bench from making an award expeditiously, and if any party shall do or cause or allow to be done any such act, that party shall pay such costs as the Bench may deem reasonable.

RULE 48:

The Bench shall not ordinarily adjourn a bearing at the request of any party, except where the circumstances are beyond the control of that party and Bench is satisfied that reasons and circumstances for the adjournment arc justified. While granting an adjournment, the Bench may make such orders regarding payment of costs by one or both of the parties, as it deems fit and reasonable.

RULE 49:

If the parties have agreed to submit their case to arbitration under these Rules and any party refuses or fails to take part in the arbitration proceedings, the Bench may proceed with the arbitration notwithstanding such refusal or absence.

RULE 50:

Where a party wishes to have any question arising in any proceedings before the Bench referred to the opinion of the Court in the form of a special case, he shall apply in writhe to the Registrar. If the Bench decides to accede to such request the party applying shall also be responsible for all legal and other costs, charges and expenses that may be incurred by the Bench in respect of and incidental to the same and shall make such deposit on account thereof and within such time as the Bench may direct In case of default in making the deposit as above, the reference shall not be made to the Court or if made shall be withdrawn by the Bench and the arbitration proceeded with as if there has been no reference to the Court.

RULE 51:

The Bench may at its discretion at any time or times before making the final award and at the expense of the parties concerned, consult any person having special knowledge relating to the particular industry, commodity, produce or branch of trade concerned in the reference or any expert or qualified accountant and may also at the like expenses of the parties, consult solicitors, counsel or advocates upon any technical question of law, evidence, practice or procedure arising in the course of the reference. If the parties agree, the Bench may, at the expense of the parties, appoint any expert, accountant, or lawyer to sit with them as an assessor and take into account the advice of such assessor.

RULE 52:

The parties to the reference and any witnesses on their behalf shall subject to the provisions of any law for the time being in force:

(a) submit to be examined by the Bench on oath or affirmation in relation to the matters in dispute.

(b) produce before the Bench all books, deeds, papers, accounts, writings and documents in their possession or power respectively which may be required or called for by the Beach.

(d) generally do all other things which during the pendeacy of the reference the Beach may require.

RULE 53:

The Bench will consider, as far as possible, to receive the evidence of witnesses by affidavit Provided that the witness whose affidavit is admitted in evidence is made available for cross-examination at the request of the opposite party.

RULE 54:

The Bench may:

(a) administer oath or affirmation to the parties or witnesses appearing and giving evidence;

(b) state a special case for the opinion of the Court or give its award in the form of special case for the opinion of the Court;

(d) correct any award any clerical mistake or error arising from or incidental to any slip or omission;

(e) administer to the parties to the arbitration such interrogatories as it may consider necessary.

(f) decide all objections to its jurisdiction including any objection regarding the existence or validity of the arbitration clause or the arbitration agreement, without prejudice to the rights of the parties to have the matter decided by a Court of law;

(g) decide the law governing:

(i) the contract or the matter in dispute,

(ii) the arbitration agreement, and

(iii) the arbitration procedure.

RULE 55:

When substantially the same dispute or questions of law and facts are likely to arise in more than one contract or agreement (Chain Contracts); the Bench may invite all parties involved to agree to submit to an award in one arbitration between such two or more of the parties as are named for the purpose.

RULE 56:

(i) The Bench may by the award dismiss the application or claim:

(a) if the claimant does not prosecute the arbitration proceedings or file the papers within the time granted.

(b) or neglects or refuses to pay the dues or deposits ordered to be paid by the Bench or the Registrar.

(ii) The Bench may make an ex-parte award:

(a) if the defendant, neglects or refuses to appear or make his defence or fails to file the papers within the time granted,

(b) or neglects or refuses to pay the dues or deposits ordered to be paid by the Bench or the Registrar.

RULE 57:

The Registrar shall make the necessary arrangements for the taking of a stenographic record of evidence whenever such record is required by a party. The cost of the stenographic record and all transcripts thereof, if any, shall form part of the costs of the reference.

RULE 58:

The language of the arbitration proceedings shall be English. If any documents filed by a party are in a language other than English, the party filing such document shall simultaneously furnish an English translation of the documents. The Registrar may make arrangements for the services of an interpreter on the request of one or more of the parties and costs thereof shall form part of the costs of the reference.

RULE 59:

The Bench may issue such orders or directions as it may deem necessary for safeguarding, interim custody, preservation, protection, storage, sale or disposal of the whole or part of the subject matter of the dispute or for its inspection or sampling without prejudice to the rights of the parties or the final determination of the dispute.

RULE 60:

Any party who proceeds with the arbitration with the knowledge that any pro- vision or requirement of these Rules has not been complied with and who fails to state his objection thereto in writing, shall be deemed to have waived his right to object.

RULE 61:

Unless required to be filed in a Court of law, the Bench shall have full discretion to retain and/or to return all books, documents or papers produced before it and may direct at any time that the books, documents or papers produced before it or any of them may be returned to the parties producing them on such terms and conditions as the Bench may impose.

RULE 62:

No award shall be made by the Bench unless the case of the party applying for arbitration has been brought to the notice of the other party and until after the lapse of such specified time within which he has been asked to submit his defence statement underrule 19-

RULE 63:

Whenever there is more than one arbitrator, the award of the majority shall prevail and be taken as the decision of the Bench. Failing a majority, the Chairman of the Bench alone shall make the award.

RULE 64:

Should the parties arrive at a settlement of the dispute by common agreement before the Bench and the Bench is satisfied that such agreement is genuine and not to defeat the purpose of any law, the Bench shall render an award as per agreement of the pities. otherwise, the Beach shall make the award on the basis of the documents, evidence, etc. filed before it by parties.

RULE 65:

The beach shall make the Award as expeditiously as possible preferably within four months according to the Guidelines (Annexure'A'), subject to a maximum limit of two years from the date of entering on the reference. If necessary, the maximum limit of two years for making the award may be extended by a new agreement between the parties to the dispute or by order of the Court.

RULE 66:

The Bench may make an interim award, and may by an award, determine and order what shall be done by either or any of the parties, respecting the matters referred.

RULE 67:

The arbitrators constituting the Bench or the Chairman whererule 63-is applicable, shall sign the award and the Registrar shall give notice in writing to the parties of the making and signing thereof and the amount of fees and charges payable in respect of the arbitration and the award.

RULE 68:

No party to the arbitration shall have any objection to the publication of awards as above provided that the names and addresses of any party to the dispute will be omitted from such publication and its identity duly concealed if so desired by such party.

RULE 69:

Additional copies of the award certified true by the Registrar shall be made available to the parties but to no one else, at all times on request and on payment as fixed by the Registrar.

RULE 70:

A party shall in all things abide by and obey the award which shall be binding on the parties and their respective representatives, notwithstanding the death of any party before or after the making of the award and such death shall not operate as revocation of the submission or reference.

RULE 71:

The Bench shall at the request of any of the parties to the proceedings or of any person claiming under a party or if so directed by the court and upon payment of fees and charges due in respect of the arbitration and award and of the costs and charges of filing the award, cause the award or a signed copy thereof together with the deposition or documents which may have been taken and proved before it to be filed before the Court.

RULE 72:

A fee of Rs. 50 to the Council in addition to the court fees, on the scale for the time being in force is payable by the party requiring the award to be filed.

RULE 73:

Stamp duties are to be paid in all cases in accordance with the scale of stamp dudes for the time being imposed by law.

RULE 74:

No party is entitled as of right to copies of proceedings before the Bench. In case the Registrar is requested to furnish copies of depositions and/or documents which have been taken or proved before the arbitrator, a charge as demanded by the Registrar shall be paid by the party requiring such copies.

RULE 75:

The Registrar shall, upon the written request of a party, furnish to such party at his expense certified fascimiles of any documents filed in the arbitration proceedings.

RULE 76:

When the party instituting a case desires to withdraw it before a Bench has been constituted, the Registrar shall return to him any deposits made by him, underrule 29-, after deducting such charges as he might have incurred in connection with the case. The registration fee, however, shall not be refundable.

RULE 77:

If the arbitration is terminated by the act or default of any party after constitution of the bench and before the award is made, any fees, charges and expenses incurred by the Council shall be paid by the parties in such proportion as the Bench shall determine.

RULE 78:

The Council, the Committee or any officer of the Council shall not be liable for any act or omission in whatever capacity they may have acted in connection with or in relation to an arbitration under these Rules.

RULE 79:

No party shall bring or prosecute any suit or proceedings whatever against the Bench, or any member thereof, for or in respect of any matter or thing purporting to be done under these Rules nor any suit or proceeding in respect thereof (save for enforcement of the award) against the other party.

RULE 80:

The Government Body may revise, amend or alter these Rules or the Schedule of fees and other monies to be charged and paid as and when they think necessary.

PART 02: INTERNATIONAL ARBITRATIONS

RULE 01:

In International arbitration, in addition to the provisions of Part I the provisions of Part II shall also apply.

RULE 02:

If provisions of Part II of these Rules are at variance or in conflict with provisions of Part I, the provisions of Part II and not those of Part I shall apply.

RULE O3:

In an arbitration which is not an International Arbitration, the parties may agree that the Rules relating to International Arbitration shall apply.

RULE 04:

The Bench shall state the reasons upon which the award is based unless the parties have agreed that no reasons shall be given.

PART 03: SMALL CLAIMS ARBITRATIONS

RULE 01:

In Small Claims Arbitration, in addition to the provisions of Part I, the provisions of Part III shall also apply.

RULE 02:

If the provisions of Part III of these Rules are at variance or in conflict with the provisions of Part I, the provisions of Part III and not those of Part I shall apply.

RULE 03:

In an arbitration between Indian parties or between an Indian and a foreign party or between foreign parties which is not a Small Claims Arbitration, the parties may agree that the Rules relating to Small Claims Arbitration shall apply.

RULE 04:

Notwithstanding rule 16(C)-in Part I, the provision regarding furnishing of photostat copies shall not apply to Small Claims Arbitration and the party applying for arbitration under this Part may furnish copies certified true by the applicant.

RULE 05:

The Registrar shall appoint a sole arbitrator on receipt of the request for arbitration.

RULE 06:

Unless both parties otherwise agree or the arbitrator otherwise directs, there shall be no oral hearing in disputes to which this part applies.

RULE 07:

Notwithstandingrule 6-above, if the parties so agree or the arbitrator so directs, oral hearings may be held to hear the parties.

RULE 08:

At the oral hearing the arbitrator may dispense with all formalities and adopt such procedures as may seem appropriate to him.

RULE 09:

The arbitrator's fee in all references under this part shall be Rs. 250 per sitting but not exceeding Rs. 1,500 for the reference and the administrative fee shall be Rs. 125 per sitting but not exceeding Rs. 1,250 for the reference.

RULE 10:

The party submitting a claim under this Part shall pay a registration fee of Rs. 100. In addition, any expenses incurred by the arbitrator or the Council shall also be payable by the parties as per order made by the arbitrator/Registrar.

Central Bare Acts

State	Central Government
Year	1940

Arbitration Act, 1940 Complete Act - Bare Act