Context:
Vice President calls for reforming Indian Arbitration System
Arbitration:
- A quasi-judicial procedure in which a dispute is submitted, by agreement of the parties, to 1 or more arbitrators who make a binding decision on the dispute.
- One of the mechanisms of Alternate Dispute Resolution (ADR).
- Mostly binding on the parties.
- Less formal than a trial, and the rules of evidence are often relaxed.
- Generally, there is no right to appeal an arbitrator’s decision.
- Except for some interim measures, there is very little scope for judicial intervention in the arbitration process.
- Arbitration in India – Governed by Arbitration and Conciliation Act, 1996
Arbitration Council of India:
- Constitutional Background – Article 51 (Encourage settlement of international disputes by arbitration)
- Objective – Arbitration and Conciliation (Amendment) Act, 2019 seeks to establish an independent body called the Arbitration Council of India (ACI) for the promotion of arbitration and other ADR mechanisms.
- Composition of the ACI – Consist of a Chairperson who is either:
- A Judge of the Supreme Court; or
- A Judge of a High Court; or
- Chief Justice of a High Court; or
- An eminent person with expert knowledge in conduct of arbitration.
- Other members – Includes an eminent arbitration practitioner, an academician with experience in arbitration, and government appointees
- Appointment of Arbitrators – Under the Act, the Supreme Court and High Courts may designate arbitral institutions, which parties can approach for the appointment of arbitrators.
Arbitration and Conciliation (Amendment) Act, 2021:
- Qualifications of Arbitrators – Does away with the qualifications of the arbitrators under 8th Schedule of the Arbitration and Conciliation Act, 1996 and held the qualifications for accreditation of arbitrators is proposed to be prescribed by regulations to be framed by an arbitration council to be set up.
- Unconditional Stay on Awards – If the Award is being given on the basis of a fraudulent agreement or corruption, then the court can grant an unconditional stay as long as an appeal under Section 34 of the arbitration law is pending.
Source: PIB
Previous Year Question
In India, separation of judiciary from the executive is enjoined by
[UPSC Civil Service Exam – 2020 Prelims]
(a) the Preamble of the Constitution
(b) a Directive Principle of State Policy
(c) the Seventh Schedule
(d) the conventional practice
Answer: (b)
