Agrud Partners

    I.  Introduction The question of whether a party to an arbitration agreement may unilaterally appoint an arbitrator has long been contested in Indian jurisprudence. The issue, though seemingly technical, strikes at the heart of arbitral fairness and the principle of party equality. Indian courts, over the last two decades, have oscillated between allowing limited forms of unilateral appointments and striking them down as incompatible with neutrality. The debate reached its sharpest expression in TRF Ltd. v. Energo Engineering Projects Ltd., where the Supreme Court invalidated clauses permitting ineligible arbitrators to nominate others.[1] Shortly thereafter, in Perkins Eastman Architects DPC v. HSCC (India) Ltd., the Court extended this reasoning to strike down unilateral appointment powers vested in one contracting party.[2] Yet in Central Organisation for Railway Electrification v. ECI-SPIC-SMO-MCML (JV) (“CORE I”), the Court upheld a government contract clause allowing the Railways to curate a panel of arbitrators, suggesting that sufficient “counter-balance” existed.[3] This divergence culminated in Union of India v. Tantia Constructions Ltd., where the Court referred the matter to a Constitution Bench.[4] In its recent decision in Central Organisation for Railway (“CORE II”) case, the Bench held unilateral appointment clauses invalid, relying on Section 18 of the Arbitration and Conciliation Act, 1996 (“Arbitration Act”) and Article 14 of the Constitution.[5] However, the Court declined to employ the doctrine of unconscionability, even as minority opinions emphasised party autonomy and statutory flexibility. This article revisits CORE II by situating it within prior jurisprudence, assessing the competing opinions, and arguing that unconscionability remains a vital tool for addressing inequality in arbitral appointments, especially for smaller entities contracting with dominant actors.   II.  Evolution of Jurisprudence on Arbitrator Appointments Indian arbitration law has consistently grappled with the compatibility of unilateral appointment mechanisms with the fundamental principles of neutrality and party equality. The trajectory of decisions leading up to CORE II illustrates a gradual tightening of judicial scrutiny. The debate first sharpened in Voestalpine Schienen GmbH v. Delhi Metro Rail Corporation Ltd., where the Supreme Court discouraged narrow, one-sided panels of government officers and directed the creation of “broad-based panels” to enhance neutrality.[6] This approach signalled judicial concern with appointments emanating from interested parties. The turning point arrived in TRF Ltd. v. Energo Engineering Projects Ltd. Here, a contractual clause empowered the Managing Director, who was himself ineligible to act as arbitrator, to nominate another arbitrator. The Court invalidated the clause, reasoning that an ineligible arbitrator could not indirectly achieve what he could not do directly. This decision underscored the concern with derivative bias. In Perkins Eastman Architects DPC v. HSCC (India) Ltd., the principle was extended. The Court distinguished between two scenarios: first, where an ineligible person appoints, and second, where a party with a vested interest retains unilateral appointment power. In both situations, the Court held, the likelihood of bias taints the process. However, in CORE I, the Court upheld Clause 64(3)(b) of the General Conditions of Contract of the Railways.⁴ The clause allowed the Railways to propose a panel of serving officers, from which the private contractor could select names for the tribunal. The Court found that the “counter-balance” afforded by such selection preserved fairness. This reasoning, however, appeared inconsistent with Perkins Eastman, since unilateral control over the pool of arbitrators remained with one party. The inconsistency prompted referral in Tantia Constructions Ltd., where the Court noted that the matter raised questions of constitutional significance.⁵ The stage was thus set for CORE II, where the Constitution Bench was tasked with clarifying whether equality and impartiality are compatible with unilateral appointment provisions. III.  The Constitution Bench in CORE II The Constitution Bench in CORE II provided the most authoritative pronouncement on unilateral appointment of arbitrators. The decision, though unanimous in striking down unilateral clauses, reflected a deep divide in the reasoning between the majority and the minority. A.    Majority Opinion The majority opinion, authored by Chief Justice D.Y. Chandrachud, anchored its reasoning in Section 18 of the Arbitration Act.[7] Section 18 guarantees equal treatment of parties and fair opportunity of participation. The Court reasoned that this principle is not confined to hearings but extends to every stage of arbitral proceedings, including appointment.[8] Thus, unilateral appointment clauses were deemed inherently violative of statutory equality. Further, the Court invoked Article 14 of the Constitution to reinforce its conclusion.[9] It emphasised that arbitral tribunals exercise quasi-judicial powers in adjudicating rights and obligations, and hence, appointment mechanisms must conform to constitutional guarantees of fairness. The majority thus constitutionalised the appointment process, extending equality principles into the contractual domain. Importantly, the Court rejected the argument that the doctrine of unconscionability could serve as an alternate ground.[10] According to the majority, arbitration agreements in the present case were executed between sophisticated commercial actors, thereby eliminating concerns of unequal bargaining power. By presuming parity of bargaining strength, the majority declined to employ unconscionability as a basis of invalidation. B.     Minority Opinion Justices Hrishikesh Roy and P.S. Narasimha authored separate opinions, concurring in the result but diverging sharply in reasoning. Both emphasised that unilateral appointments are not expressly prohibited by the Arbitration Act. Justice Roy underlined that Section 12(5) read with the Fifth and Seventh Schedules already provided a comprehensive mechanism for assessing arbitrator independence.[11] He argued that if impartiality is ensured through these safeguards, unilateral appointment in itself does not offend equality. Justice Narasimha drew a clear distinction between ineligibility and unilateral appointment.[12] While ineligibility, as in TRF Ltd., renders an arbitrator legally incapable of acting, unilateral appointment is a matter of contractual design. He also stated that the “unconscionability” argument would not stand because commercial contracts between parties of equal power do not hold would not give rise to such a situation. C.    Critical Note The majority opinion included constitutional equality while considering procedural aspects of arbitration, but failed to consider the practical implications of parties with skewed power to bargain. The minority opinion restricted itself to the word of the Arbitration Act, but failed to correctly asses the risk of bias, which is a consideration in unilateral employment. Both approaches did not consider the unconscionability argument, thus refusing to employ a flexible tool with great potential to address inequality in standard-form contracts. IV.  The Doctrine of Unconscionability: Comparative Perspectives The doctrine of unconscionability has been developed in several jurisdictions as a safeguard against unfair contractual terms, particularly in situations marked by disparities in bargaining power. Its treatment in the United States of America and Australia could serve as a guide for the Indian pproach as well. A. United States In the United States, the Uniform Commercial Code (“UCC”) codifies unconscionability under section 2-302.[13] Courts applying this provision recognise both procedural unconscionability, which concerns the manner of contract formation, and substantive unconscionability, which relates to the unfairness of terms themselves.[14] The doctrine is not limited to consumer disputes; it has also been applied in commercial contexts. In Mobile Home Fact Outlet v. Butler, a court confirmed that arbitration agreements, like other contracts, are subject to unconscionability defences.[15] This recognition is significant, as it undermines the presumption that commercial entities are always equals in negotiations. The commentary appended to § 2-302 further instructs courts to examine the commercial setting and background at the time of contracting, acknowledging that context often determines fairness.[16] B. Australia Australia has similarly embraced statutory interventions to address unfair terms. The Contract Review Act, 1980 empowers courts to review “unjust” contracts, taking into account the purpose, effect, and surrounding circumstances, without excluding business-to-business dealings.[17] Section 17 prohibits parties from contracting out of its protections, ensuring that even arbitration agreements may be scrutinised for unconscionability.[18] Further, reforms through the Treasury Laws Amendment (More Competition, Better Prices) Act, 2022 extended protections against unfair contract terms to small businesses.[19] Australian courts have applied this regime to franchise and supply contracts, striking down arbitration clauses that entrenched the superior bargaining position of one party. The American and Australian jurisdictions approach unconscionability as a tool to both protect consumers as well as to broadly target imbalance in bargaining powers, even when it pertains to commercial arbitration contracts. Considering this, India could follow their lead and reconsider its complete rejection of the unconscionability doctrine in the CORE II case.   V.  The Indian Position on Unconscionability It is recognised in Indian contract law that any obtained consent in a situation with unequal bargaining power can be vitiated. In the Indian Contract Act, 1872, Section 16 defines undue influence as the misuse of a dominant position to obtain an advantage unfairly; and Section 23 declares contracts with objects or considerations opposed to public policy to be void in their entirety.[20] Courts use these provisions to target and invalidate contracts where one party in unable to choose freely and thus may have entered into an unequal or exploitative agreement. In Central Inland Water Transport Corp. v. Brojo Nath Ganguly, the Supreme Court held a termination clause in an employment contract of a state enterprise to be invalid because it was “unconscionable” and “against public policy”.[21]  The Court stated that freedom to contract could not allow or authorise clauses that exploit the vulnerable party or disturb the conscience. Although the case was regarding an employment contract, the principle laid down by the Court broadly recognised that skewed bargaining power could exist even in a seemingly voluntary arrangement. In LIC of India v. Consumer Education & Research Centre, the Court restated that a standard form of contract, specifically those used by public corporations, could and should be inspected for unfair terms.[22]  It was observed that smaller entities or individuals party to such contracts realistically often have little choice except accepting whatever is imposed upon them by the stronger party, and judicial supervision was important to prevent this. The Law Commission’s 2006 Report on “Unfair (Procedural and Substantive) Terms in Contracts” also brought up such concerns, and recommended legal recognition of unconscionable clauses even in commercial relationships.[23] The Report also noted that smaller enterprises contracting with larger enterprises or state corporations are especially vulnerable to unconscionable terms. However, the Supreme Court in CORE II chose to disregard this jurisprudence and reform recommendations and rejected the unconscionability argument, assuming that entities enter into commercial relationships with equal power. This narrow interpretation and assumption has disregarded the reality of the Indian market, where smaller franchisees, contractors or suppliers are often severely dependent on larger parties. VI.  Implications for Startups and Small Enterprises The exclusion of unconscionability from arbitration jurisprudence in CORE II has particularly adverse implications for startups and small enterprises. In India’s contemporary economy, many such entities are compelled to contract with larger corporations, state instrumentalities, or public sector undertakings to access markets or resources. The bargaining asymmetry in these relationships is evident, yet the Court assumed that commercial actors always negotiate on an equal footing. Startups often depend on investment or supply agreements drafted entirely by dominant parties. Arbitration clauses in these agreements may designate the forum, language, and seat of arbitration, and occasionally permit unilateral appointment of arbitrators. The broader problem persists even when unilateral clauses have been declared void, as the weaker party is forced to accept other unfavourable terms and concessions in the form of prohibitive costs, exclusive jurisdiction clauses or foreign seat provisions, all of which function as barriers to access.[24] By disregarding the doctrine of unconscionability, Indian courts do not have a standard flexible enough to oversee any such unfair terms. In comparison, the Australian and United States jurisdictions protect even small businesses entering into agreements with larger firms under the unconscionability doctrine.[25] Such protections recognise that economic dependence may lead to vulnerability that is usually seen in consumers and not contracting parties. The Indian approach, in contrast, confuses “commercial” with “equal”, thus failing to recognise the variations in commercial actors. This may impact commercial policy in India. India’s startup ecosystem, often celebrated as a driver of innovation, is particularly exposed to contractual overreach. Early-stage enterprises rarely have the legal or financial capacity to negotiate balanced arbitration clauses.[26] The absence of a judicial mechanism to intervene in cases of procedural or substantive unfairness increases the risk that arbitration becomes a tool for entrenching inequality rather than delivering justice. Thus, while CORE II marks a progressive step in eliminating unilateral appointment of arbitrators, its refusal to engage with unconscionability undercuts protection for weaker commercial entities. The challenge ahead lies in reconciling the principles of contractual autonomy with safeguards against systemic unfairness in arbitration agreements. VII.  Conclusion The CORE II decision decisively invalidated unilateral appointment of arbitrators, reinforcing equality under Section 18 and Article 14. Yet, by excluding unconscionability, the Court overlooked the vulnerabilities of startups and small enterprises contracting with dominant parties. Comparative experiences from the United States and Australia illustrate that unconscionability is not confined to consumer protection but serves as a safeguard in commercial contexts as well. For India, striking a balance between contractual autonomy and fairness remains essential. Without this, arbitration risks becoming an instrument of inequality rather than a mechanism of justice.   [1] TRF Ltd. v. Energo Eng’g Projects Ltd., (2017) 8 SCC 377. [2] Perkins Eastman Architects DPC v. HSCC (India) Ltd., (2020) 20 SCC 760. [3] Cent. Org. for Ry. Electrification v. ECI-SPIC-SMO-MCML (JV), (2020) 14 SCC 712. [4] Union of India v. Tantia Constrs. Ltd., (2021) 10 SCC 385. [5] Cent. Org. for Ry. Electrification v. ECI-SPIC-SMO-MCML (JV), 2024 SCC OnLine SC 123. [6] Voestalpine Schienen GmbH v. Delhi Metro Rail Corp. Ltd., (2017) 4 SCC 665. [7] Arbitration and Conciliation Act, No. 26 of 1996, § 18. [8] Cent. Org. for Ry. Electrification v. ECI-SPIC-SMO-MCML (JV), 2024 SCC OnLine SC 123, ¶ 54. [9] Id. ¶ 61. [10] Id. ¶ 72. [11] Arbitration and Conciliation Act, No. 26 of 1996, § 12(5) & Schs. V, VII. [12] Cent. Org. for Ry. Electrification v. ECI-SPIC-SMO-MCML (JV), 2024 SCC OnLine SC 123, Narasimha, J., dissenting, ¶ 32. [13] U.C.C. § 2-302 (Am. L. Inst. & Unif. L. Comm’n 2022) (U.S.). [14] Williams v. Walker-Thomas Furniture Co., 350 F.2d 445, 449–50 (D.C. Cir. 1965) (U.S.). [15] Mobile Home Fact Outlet v. Butler, 564 S.E.2d 728, 732 (N.C. Ct. App. 2002) (U.S.). [16] U.C.C. § 2-302 cmt. 1 (U.S.). [17] Contract Review Act 1980 (NSW) §§ 9(1), 9(2)(l) (Austl.). [18] Id. § 17(1), § 17(5). [19] Treasury Laws Amendment (More Competition, Better Prices) Act 2022 (Cth) (Austl.). [20] Indian Contract Act, No. 9 of 1872, §§ 16, 23 (India). [21] Cent. Inland Water Transp. Corp. v. Brojo Nath Ganguly, (1986) 3 S.C.C. 156, 209. [22] LIC of India v. Consumer Educ. & Research Ctr., (1995) 5 S.C.C. 482, 510. [23] Law Comm’n of India, 199th Report on Unfair (Procedural & Substantive) Terms in Contracts 25–27 (2006). [24] Itek Corp. v. Compagnie Int’l Pour l’Informatique CII Honeywell Bull S.A., 566 F. Supp. 1210, 1215 (D. Mass. 1983) (U.S.). [25] U.C.C. § 2-302 (Am. L. Inst. & Unif. L. Comm’n 2022); Contract Review Act 1980 (NSW) § 9 (Austl.). [26] Law Comm’n of India, 199th Report on Unfair (Procedural & Substantive) Terms in Contracts 38–39 (2006).

I. Introduction The objective behind introducing the Insolvency and Bankruptcy Code, 2016 (“IBC”) was to maximising value and protecting the rights of creditors. It aims to balance the interests of all stakeholders while enabling distressed firms to either restructure or exit efficiently. However, a recurring issue which lurks behind is the legal standing of secured creditors within this system, especially when their claims intersect with state laws relating to asset attachment. Supreme Court in its recent ruling in the National Spot Exchange Ltd. v. Union of India, 2025 (“NSEL case”). The case revolved around the treatment of assets attached under special state and central statutes, specifically the Maharashtra Protection of Interest of Depositors in financial establishments Act, 1999 (“MPID Act”) and the Prevention of Money laundering Act, 2002 (“PMLA”) in the context of corporate insolvency proceedings. The main issue before the court was to determine whether secured creditors could enforce their rights over assets already attached under these statutes, or whether such enforcement would conflict with the moratorium and waterfall mechanism under Section 14 and Section 53 respectively. In its judgment, the Supreme Court held that the MPID Act and PMLA would take precedence over the IBC, SARFAESI, and the Recovery of Debts and Bankruptcy Act, thereby denying secured creditors the right to enforce security over attached properties. Supreme Court also held that the MPID Act and PMLA would take precedence over the IBC, SARFESI, and the Recovery of Debts and Bankruptcy Act,[1] meaning thereby, IBC’s moratorium would not override attachments made under these statues prior to the initiation of insolvency proceedings. This judgment raises critical concerns about the consistency and integrity of the IBC’s design. Traditionally, secured creditors have enjoyed a privileged position under insolvency law, with Sections 52 and 53 offering a structured choice which was either to enforce security outside the liquidation estate or relinquish it and participate in the common distribution mechanism.[2] By allowing the enforcement of special statutes to interfere with this choice, the Court has arguably opened a backdoor for state-driven priorities to displace the collective resolution model envisaged by the IBC. The ruling is particularly significant given the backdrop of systemic financial fraud and regulatory breakdown in the NSEL case. Thousands of investors were defrauded of over ₹5,600 crore due to the unauthorised trading of paired contracts, prompting investigative and enforcement action by multiple agencies.[3]While the state’s interest in securing assets for investor compensation is undeniably valid, it now stands at odds with the uniform creditor recovery process under the IBC. The Court’s endorsement of this disjunction invites further inquiry into the future of insolvency jurisprudence and the place of secured creditors within it. II. Rights of Secured Creditors under the IBC The IBC accords secured creditors a distinctly privileged position in the insolvency framework. At the heart of this structure lies Section 52, which offers a secured creditor the option to either (a) enforce its security interest outside the liquidation estate in accordance with applicable laws, or (b) relinquish such interest and participate in the distribution of assets under Section 53.[4] The law, therefore, acknowledges both the autonomy of secured creditors and the need for collective resolution where they choose to join the liquidation pool. When opting for enforcement outside the estate, secured creditors are entitled to realise their security under existing laws, such as the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (“SARFAESI”) or the Recovery of Debts and Bankruptcy Act, 1993. This allows banks and financial institutions to bypass judicial approval, facilitating faster recovery through auction or possession of the mortgaged property.[5] The IBC does not inhibit this route, provided it does not obstruct the conduct of insolvency proceedings or contravene the moratorium under Section 14. On the other hand, if secured creditors choose to surrender their security and fall in line with other claimants under Section 53, the Code grants them a top-tier priority in the waterfall. They rank second only to the insolvency resolution process costs and liquidation expenses.[6] This ensures that their claims are met before those of operational creditors, government dues, and shareholders. The Supreme Court has previously upheld this dual-choice architecture as intrinsic to the Code’s creditor-driven ethos. In India Resurgence ARC Pvt. Ltd. v. Amit Metaliks Ltd., the Court recognised the commercial wisdom of financial creditors as paramount, reiterating that the Code’s object was to facilitate resolution rather than recovery.[7] At the same time, it affirmed that secured creditors possess enforceable rights that cannot be diluted arbitrarily by other statutes unless such interference is explicitly sanctioned. This autonomy is unfettered, any parallel proceedings that may jeopardise the corporate debtor’s resolution or liquidation process is restricted by IBC. Section 238 establishes an overriding effect over other laws “notwithstanding anything inconsistent therewith,” allowing it to displace conflicting statutory schemes.[8]. III. Interplay between the IBC and Asset Attachment Laws A critical fault line in the Indian Legal landscape seems to be the growth of friction between insolvency law and state-led asset attachments. While the IBC attempts to centralise claims resolution and maximise asset value through a structured process, parallel statutes, especially those concerning criminal law and investor protection, frequently intervene by freezing assets under investigation. Due to this, secured creditors find themselves entangled in jurisdictional stand-offs. Several laws enable the state to attach or confiscate property on the grounds of fraud, misappropriation or public interest. These include the PMLA, the MPID Act, and other state-specific legislations aimed at safeguarding investor money. Once such attachment orders are passed, they often take precedence over civil enforcement, including insolvency claims. Courts have been inconsistent in resolving this overlap. In P. Mohanraj v. Shah Brothers Ispat Pvt. Ltd., the Supreme Court acknowledged that criminal proceedings cannot be stayed under the IBC’s moratorium.[9] However, it left open the extent to which state attachment laws could override creditor rights under the Code. A key source of this conflict lies in the interpretation of Section 238 of the IBC, which gives the Code primacy over “inconsistent” laws. Courts have held that where the objective of another statute diverges fundamentally from that of the IBC, such as protecting defrauded investors or punishing economic offences—Section 238 may not apply.[10] This reasoning has led to a de facto erosion of the IBC’s supremacy in certain enforcement contexts, particularly in cases involving alleged fraud or financial scams. One such example is The Directorate of Enforcement v. Manoj Kumar Agarwal, where the Delhi High Court upheld the attachment of assets by the ED under the PMLA even though they formed part of the liquidation estate. The Court reasoned that proceeds of crime cannot be allowed to benefit creditors, regardless of their security status.[11] In contrast, in Directorate of Economic Offences v. Binay Kumar Singhania, the Calcutta High Court ruled in favour of the Resolution Professional, holding that attached properties must be released to enable resolution under the IBC.[12] The lack of a settled judicial approach has left creditors in a precarious position. Where state authorities attach assets during or prior to the initiation of insolvency proceedings, the effectiveness of resolution plans and the value realisation for creditors suffer greatly. In particular, secured creditors find their security rendered ineffective, unable to access collateral that is otherwise protected under the Code. It is in this conflicted space that the recent NSEL ruling intervenes. The NCLT and CoC would find themselves negotiating with a fragmented estate, significantly reducing recoveries for all stakeholders.[13] IV. Assessing the Future Trajectory of Creditor Rights in a Dual-Regulatory Ecosystem 1. The Expanding Role of Enforcement Statutes Post-NSEL, there has been a visible trend where state and central agencies move swiftly to secure assets under penal statutes, even before any commercial resolution is considered. In high-profile insolvency cases involving alleged fraud, such as those concerning DHFL and ABG Shipyard, enforcement agencies have attached properties well before resolution professionals could take control under the IBC. This reflects a growing reality where enforcement statutes are no longer merely ancillary but operate as de facto gatekeepers to insolvency assets. Such pre-emptive action creates confusion about who controls the corporate debtor's estate, undermining the clean-slate objective and reducing asset realisation potential. It also adds to the compliance and litigation burden on resolution professionals and delays the approval of resolution plans. 2. Reassessing the Scope of Section 238 of the IBC One immediate question arising from the Supreme Court’s approach in NSEL is whether Section 238, which grants overriding effect to the IBC in cases of inconsistency, has been weakened in substance. Critics argue that the Court adopted an overly narrow reading of "inconsistency", one that does not take into account the IBC's broad objective of maximising asset value and promoting timely resolution.[14] If every penal or investor-protection statute can operate in parallel without being overridden, it leaves the insolvency framework vulnerable to constant disruption. Going forward, courts and the legislature must engage in a principled determination of “field overlap”, rather than treating each statute in silos. 3. The Case for Asset Ring-Fencing and Legislative Clarification The situation calls for a legislative solution that can bridge the growing friction. One possible reform is the statutory ring-fencing of assets that are subject to legitimate security interests or resolution plans approved under the IBC, shielding them from post-facto attachments unless the resolution itself is proven to be fraudulent. A precedent in this regard can be found in Singapore’s Insolvency, Restructuring and Dissolution Act, 2018, which allows court-supervised moratoriums to prevail over certain criminal proceedings to protect the corporate debtor’s restructuring prospects.[15] Similarly, UK’s Corporate Insolvency and Governance Act 2020 introduced restrictions on creditor action during restructuring periods, recognising that enforcement must occasionally take a backseat to economic revival. Indian law could take cues from these models and enact a harmonisation clause that mediates between creditor rights and state enforcement, especially when both claim to be acting in the public interest. 4. Credit Risk and Market Behaviour The erosion of secured creditor primacy may also have a downstream effect on credit risk assessment, particularly in sectors prone to regulatory action or political scrutiny. Financial institutions may begin to charge higher interest rates, demand stricter covenants, or altogether avoid sectors where post-default asset access is uncertain. These kinds of reactions result in the loss of MSMEs and companies in emerging industries, where regulatory frameworks are still evolving. It is also likely to deter foreign creditors, who often rely on enforceability of security interests as a proxy for rule-of-law standards in emerging markets. V. Conclusion: Striking a Balance between Commercial Finality and Justice The NSEL judgement has undoubtedly triggered a watershed moment in India’s insolvency regime. It highlights that insolvency law does not operate in isolation, but alongside a wider legal framework that includes, economic, social and criminal laws. The challenge, therefore, lies not in asserting the dominance of one legislative instrument over another, but in developing a coherent and coordinated regulatory ecosystem. The clean slate principle is not a judicial favour but a tool to ensure business continuity and value recovery. When courts allow post-resolution attachments, as seen in the Anil Agarwal decision, it creates uncertainty and undermines investor trust.[16] A more balanced approach would involve legal reforms and clearer judicial guidance to align enforcement actions with the objectives of resolution under the IBC.   [1] National Spot Exchange Ltd. v. Union of India, 2025 SCC OnLine SC 113. [2] Insolvency and Bankruptcy Code, 2016, §§ 52, 53. [3] “SBI Seeks Review of SC Ruling Denying Secured Creditors Priority over Attached Assets,” The Economic Times (May 15, 2025), [4] Insolvency and Bankruptcy Code, 2016, § 52. [5] See Transcore v. Union of India, (2008) 1 SCC 125 [6] Insolvency and Bankruptcy Code, 2016, § 53(1)(b). [7] India Resurgence ARC (P) Ltd. v. Amit Metaliks Ltd., (2021) 19 SCC 672. [8] Insolvency and Bankruptcy Code, 2016, § 238. [9] P. Mohanraj v. Shah Bros. Ispat (P) Ltd., (2021) 6 SCC 258. [10] Rotomac Global (P) Ltd. v. Director, Directorate of Enforcement, 2019 SCC OnLine NCLAT 1545. [11] Ashok Kumar Sarawagi v. Enforcement of Directorate, 2022 SCC OnLine NCLAT 3453. [12] Directorate of Economic Offences v. Binay Kumar Singhania, 2021 SCC OnLine NCLAT 159. [13] Arka Majumdar et al., Supreme Court’s Decision in National Spot Exchange Limited v. Union of India: Priority of Secured Creditors in Flux?, IBC – NCLAT Fortnightly Summary, Mondaq, https://www.mondaq.com/india/insolvencybankruptcy/1630702/supreme-courts-decision-in-national-spot-exchange-limited-v-union-of-india-priority-of-secured-creditors-in-flux. [14]Ashish Dasgupta, “IBC and Enforcement Laws: Inconsistent or Interlocking?”, LiveLaw (2023), https://www.livelaw.in/columns/ibc-and-enforcement-laws-inconsistent-or-interlocking-230489. [15] Insolvency, Restructuring and Dissolution Act 2018 (Singapore), Part 5, §§ 64–70. [16] Anil Agarwal Foundation v. State of Orissa, (2023) 20 SCC 1

I.  Introduction Over the past few years, carbon credits have become a thriving global trade system valued in billions. In particular, the voluntary market (“VCM”), has attracted growing interest from private actors looking to offset emissions, and from project developers in the Global South seeking finance for sustainable initiatives. Simultaneously, an increasing number of disputes have begun to surface.[1] Unlike earlier, they are no longer confined to questions of contract law. They often involve deeply technical debates around environmental integrity, scientific validation, and data verification. Traditional dispute resolution methods, especially international arbitration, are struggling to adapt to this evolving landscape. Arbitration institutions like the International Chamber of Commerce (“ICC”), the London Court of International Arbitration (“LCIA”), and others have long been the default forums for resolving transnational commercial disagreements. Yet when applied to carbon credit conflicts, they appear slow, costly, and ill-equipped to manage the scientific and regulatory complexity of these cases. Several disputes related to carbon credits have emerged involving alleged double issuance of credits, delays in validation, challenges to additionality, and the sale of credits from projects that failed to meet permanence standards. These disagreements are often governed by standard contracts, but their underlying factual disputes are rooted in climate science, satellite data, and rapidly changing market regulations.[2] As the carbon economy expands, the trustworthiness of offset credits has become central to their legal and financial viability. The credibility of these markets will, in large part, depend on whether the disputes they give rise to are resolved in a timely, transparent, and technically sound manner. This article argues that the current international arbitration frameworks are falling short of this standard and must be reshaped if they are to meet the demands of a decarbonising world. II. The Evolution of Carbon Markets and the Nature of Disputes Carbon markets were introduced as part of a broader attempt to tackle climate change using economic tools. The idea was straightforward: to allow entities that exceed their emission reduction targets to sell excess reductions to those that do not. Under the Kyoto Protocol, the Clean Development Mechanism (“CDM”) allowed developed countries to invest in emission-reduction projects in developing nations and receive certified emission reductions (“CERs”) in return. This laid the groundwork for carbon credits as tradable instruments in a global marketplace. The voluntary carbon market has grown rapidly and largely independently, whereas the compliance markets continue to operate under governmental or intergovernmental mandates. It enables businesses and individual to buy carbon offsets outside of regulatory obligations, often to meet internal or domestic environmental commitment. Although the certificates vary in methodology and oversight, standards such as Verra’s Verified Carbon and the Gold Standard have emerged to ensure credibility. The disputes have been increasing proportionally with the financial projects in these offsetting projects. At the centre of many of these disputes is the question of integrity. One recurring issue is additionality. For generating credits, a project must produce emissions reductions that would not have occurred without it. Disputes mainly arise, when this claim is contested through updates data or scientific reassessments. Another pultruding issue is of permanence. This becomes problematic in case of forestry projects that are at risk of wildfires, pests, or illegal clearing. If such events occur, previously issues credits may lose their environmental value long after they have been traded. Double counting has been a major issue given the lack of a unified registry across the voluntary market. This happens when a single credit is sold more than once, or when both the host country and the buyer claim the same credit. As carbon credits become more commoditised, these disputes are no longer confined to technical concerns, raising significant legal, commercial and ethical questions. These disagreements usually involve parties across jurisdictions, complex scientific data, and require timely resolution. However, existing dispute resolution processes are struggling to keep pace.[3] III. Why Current International Arbitration Frameworks Fall Short International arbitration due to its neutrality, enforceability, and procedural flexibility has long been preferred for resolving cross-border commercial disputes. However, limitations start to arise as it is applied to the carbon credit market. The complex, science driven and often time-sensitive nature of these cases poses challenges that traditional arbitration systems were not designed to handle. One of the key issues is the lack of technical expertise among arbitrators. While the arbitration panels are composed of experienced legal and commercial professionals, they rarely include individuals with backgrounds in climate science, environmental economics, or carbon accounting, which creates problems when disputes turn on highly specific technical questions such as whether a carbon sequestration project meets additionality standards or whether monitoring data justifies credit issuance. In such matters, legal knowledge alone is insufficient. Another issue is of procedural delay. While many disputes over carbon credits are time sensitive, yet arbitration proceedings, under institutions like the ICC or LCIA, often extend over several months or even years. This delay undermines both the financial value of the disputed credits and the environmental objectives of the underlying projects. Another significant barrier is cost as smaller project developers, especially in the Global South, may lack the resources to pursue full arbitration proceedings. Financial pressure constrains their ability to defend their claims or challenge discrepancies, even though these parties are the ones producing credits. This results in an imbalance in procedural access, which undermines the fairness of the process. Consistency is also lacking. Carbon credit disputes do not currently benefit from any consolidated body of precedents. Awards are often confidential, fragmented, and grounded in varying contractual and institutional rules. This leaves market participants with little guidance on how similar disputes may be resolved in the future. Finally, enforcement presents its own challenges. Although arbitral awards are generally enforceable under the New York Convention, the transnational nature of carbon credit transactions, combined with regulatory ambiguity in certain jurisdictions, can make enforcement unpredictable. This uncertainty creates risk for investors and developers alike.[4] In sum, while arbitration remains a cornerstone of international commercial law, it is not yet equipped to meet the particular needs of the carbon credit market. Without reform, the gap between market complexity and procedural adequacy will continue to widen. IV.  Specific Procedural and Institutional Gaps Beyond the general mismatch between arbitration and the nature of carbon credit disputes, specific procedural and institutional features make current systems particularly unsuited to this context. Arbitrator selection is one such problem. Most arbitral institutions permit parties to nominate their own arbitrators, typically favouring those with commercial, construction, or financial backgrounds. However, disputes concerning carbon credits often involve technical evidence drawn from climate modelling, ecological monitoring, or satellite imagery. In the absence of a neutral expert or scientifically literate tribunal, the outcome of the dispute may depend not on the strength of the evidence but on the parties’ ability to explain complex data in simplified terms, which disadvantages smaller actors and reduces the integrity of the process.[5] The other challenge is of evidentiary rules. The carbon credit claims rely on highly technical material, such as validation reports, drone footage, geospatial datasets, and digital registries that do not generally align with traditional forms of proof. In this scenario, the standard evidentiary rules may either overburden the process or fail to accommodate these new types of evidence in a meaningful way. Confidentiality which goes hand in hand with arbitration, becomes a double edged sword. While parties prefer discretion in commercial matter, carbon credits disputes often implicate wider interests. A forest project that loses its credits due to non-compliance does not only affect the investor and the verifier; it can impact local livelihoods and regional climate targets. Resolving such disputes in private, give very little scope for public scrutiny or regulatory learning. Finally, there is also an issue of procedural flexibility. While institutional rules allow for expedited procedures, these are rarely invoked in practice for carbon market claims. Further, delays in resolving disputes not only affect project financing but may also lead to environmental non-performance or reputation loss of buyers. V. The Path Forward: Institutional Reforms and New Frameworks 1. Establishment of a Dedicated Carbon Arbitration Centre A specialised body focused on environmental and carbon-related disputes should be made. A Carbon Market Arbitration Centre (“CMAC”) could be housed in neutral jurisdictions with robust arbitration hubs such as Singapore or London. This centre would be equipped with rules, procedures, and personnel specifically tailored to handle disputes over carbon credit issuance, verification and trade. 2. Expert Panels with Scientific and Technical Backgrounds Rosters of experts in climate science, carbon accounting, foster management, and data verification should be there as support in Tribunals. Their appointment would be as tribunal members or they would serve in an advisory capacity. Their presence would ensure that technical arguments are assessed with the necessary depth and accuracy.[6] 3. Model Clauses for Carbon Credit Contracts Standardised arbitration clauses specifically designed for carbon markets should be adopted by market participants. These clauses should include terms regarding the forum, governing law, use of technical experts, and timelines for resolution. Institutions like the International Bar Association or UNIDROIT could lead in drafting such instruments. 4. Regional Hubs to Increase Access and Equity Dispute resolution facilities must also be accessible to parties in regions where many carbon offset projects originate. Establishing regional arbitration hubs in Africa, Southeast Asia, and Latin America would improve access to justice and reduce costs for project developers. These hubs could operate under the umbrella of the global centre, ensuring consistency in procedure and standards. 5. Procedural Streamlining and Emergency Measures Rules should incorporate fast-track procedures and emergency arbitration mechanisms for disputes that involve time-sensitive project funding, certification deadlines, or reputational risks. This would ensure that key commercial or environmental outcomes are not undermined by procedural delay. These reforms, taken together, would help create a dispute resolution ecosystem that is credible, fair, and responsive to the demands of a fast-evolving carbon market. VI. Integrating Technology in Dispute Resolution Technology has already begun to transform the way carbon credits are generated, verified, and traded. The next step is to incorporate these technological tools into the resolution of disputes. Doing so would not only enhance the accuracy and transparency of proceedings but also reduce procedural delays and costs. 1. Blockchain-Based Verification and Smart Contracts - Blockchain technology is increasingly used to track the issuance and transfer of carbon credits. Platforms like KlimaDAO and the Toucan Protocol have pioneered on-chain carbon registries that record every transaction on an immutable ledger. By integrating these records into arbitration proceedings, tribunals can verify transactions and ownership claims without relying solely on traditional documentation. Smart contracts could also automate performance obligations, reducing the scope for interpretive disputes.[7] 2. AI-Assisted Evidence Review - Disputes involving environmental claims often require analysis of large data sets. Artificial intelligence tools can help in reviewing satellite imagery, drone footage, and validation reports. These tools can flag anomalies, generate patterns, and assist arbitrators in assessing factual claims. For example, AI has already been used to detect illegal deforestation in carbon projects by analysing changes in land cover over time.[8] 3. Online Dispute Resolution (ODR) Platforms - Given the global nature of carbon markets, ODR can make arbitration more accessible and affordable. Cloud-based platforms can host digital hearings, allow secure document submissions, and accommodate parties from different jurisdictions and time zones. These systems also allow for transparent, multilingual proceedings, improving participation from project developers in non-English-speaking regions. 4. Data Registries as Evidence Sources - Verified carbon registries that operate publicly and transparently can serve as admissible sources of truth in arbitration. When these registries are linked to independent monitoring systems, such as satellite-based carbon measurement platforms, they offer a more objective basis for resolving disputes. Integrating these technologies into arbitration would not only improve efficiency but also help restore market confidence by creating a more objective and traceable process for handling carbon-related claims. VII. Conclusion As the carbon credit market grows in scale and complexity, its credibility increasingly depends on the strength of the legal mechanisms that underpin it. Rising disputes over verification, ownership and project integrity are no longer hypothetical. Investments, community trust, and the environmental value of offsets are already being affected. Even though the current arbitration framework is well established in commercial contexts, a gaping hole still remains in the context of carbon credit market. If carbon credits are to play a meaningful role in global climate mitigation, their legitimacy must be protected, which will require coordinated reforms across several levels. A specialised arbitration centre with scientific expertise which integrates technology would strengthen the procedural reliability of the system. The private stakeholders, arbitral institutions and policy actors must work together to shape a dispute resolution framework that reflects the urgency and complexity of climate action for arbitration to contribute meaningfully to integrity and resilience of the carbon economy. [1] Nishtha Singh, Harman Singh, Chetna Arora & Vaibhav Chaturvedi, Role of Financial Players in the Indian Carbon Market: Learning from Existing Markets and Stakeholder Perspectives, Council on Energy, Environment and Water Issue Brief (Oct. 22, 2024), https://www.ceew.in/publications/role-financial-players-indian-carbon-market [2] Dispute Resolution in Carbon Markets, Kluwer Arbitration Blog (Sept. 16, 2023), https://arbitrationblog.kluwerarbitration.com/2023/09/16/dispute-resolution-in-carbon-markets/ [3] See David Takacs, Carbon Offsets & Inequality, 56 Harv. Int’l L.J. 167, 176–78 (2015). [4] See Gary B. Born, International Commercial Arbitration 394–96 (3d ed. 2021). [5] Michael Scherer, International Arbitration and Climate Change, 38 Arb. Int’l 1, 7 (2022). [6] See Catherine Kessedjian et al., Principles on Climate Obligations of Enterprises, 51 Geo. Wash. Int’l L. Rev. 683, 701–03 (2019). [7] Klaus Schwab & Nicholas Davis, Shaping the Fourth Industrial Revolution 82 (2018). [8] Celine Herweijer et al., Building the Climate-Resilient Company, McKinsey & Co. (2022).

I. Introduction The Indian judiciary operated under a great burden, with over five crore pending cases and a poor judge-to-population ratio of just 21 judges per million. The Law Commission of India had recommended a ratio of 50 judges per million more than thirty years ago, yet this is less than half of that.[1] This has led to extensive delays, procedural practices that vary across courts and areas, and broadly a gradual loss of confidence in the justice system. This burden is particularly observed in cases concerning privileges. Litigation often involves large volumes of confidential data, which ranges from physical to electronic records, and the risk of inadvertently infringing legal privileges or fundament rights has grown. Such information, if handled badly in criminal cases, can lead to a violation of Article 20(3) of the Constitution, which contains the right against self-incrimination.[2] In commercial disputes, attorney-client communications or trade secrets are often the subject of litigation, which further raises problems with confidentiality. However, Indian law does not have a structured or consistent mechanism to handle such disputes relating to privileges. Judges may themselves go through camera reviews, but this process is both time-consuming and carries a risk of coming across material that could prejudice them to a particular side. International best practices, especially appointment of independent “privilege referees” or “special masters” to overlook contested documents, could be a possible solution. Such neutral experts allow courts to safeguard privilege while reducing delays, a solution that could be especially useful as India aspires to position itself as an arbitration-friendly jurisdiction.[3] II. Privilege Issues in Contemporary Times Legal professional privilege remains a cornerstone of justice delivery, protecting the confidentiality of attorney–client communications and ensuring that individuals or corporations can seek legal advice without fear of disclosure. In practice, however, courts worldwide are increasingly confronted with disputes that test the boundaries of this protection. The rapid expansion of electronically stored information (ESI), cloud computing, and cross-border data transfers has made privilege adjudication more complex than ever. The United States has seen a rise in privilege disputes during high-profile investigations. An example would be the inquiry into President Trump’s conduct regarding certain classified documents, where an independent “special master” was appointed by the federal authorities to separate any privileged documents from admissible evidence.[4] Similarly, in Waymo LLC v. Uber Technologies Inc., a dispute involving confidential trade secrets needed similar separations through voluminous amounts of digitally stored records.[5] Such technology-heavy disputes are of such nature that objective and neutral supervision is required to maintain equitableness. Even in India, enforcement agencies like the Directorate of Enforcement and the Serious Fraud Investigation Office come into possession of immense amounts of documents during raids.[6] Without a neutral third-party referee, there can be no surety that improper access or misuse of sensitive or privileged legal material does not take place. While the Indian Evidence Act, 1872 (and now the Bharatiya Sakshya Adhiniyam, 2023) allows for privilege under Sections 126–129,[7] there is no judicial mechanism to adjudicate the same and judges themselves must examine such documents and perform camera reviews. This not only consumes scarce judicial time but also risks exposure to information that could subconsciously bias the adjudicator. As litigation becomes increasingly data-driven, the inadequacies of India’s current approach become clear. Unbiased third-party evaluators, in the form of “privilege referees”, would ensure a structural resolution process of disputes while maintaining the impartial nature of the adjudicating authority. By acting as a procedural filter, they would also protect parties’ confidence that privileged information remains secure, something crucial in both criminal trials and high-stakes commercial litigation. III. Comparative Jurisprudence on Privilege Referees and Special Masters Comparative experience demonstrates that privilege referees are neither novel nor experimental; they are an established procedural safeguard in several common law jurisdictions. Their use has been most visible in the United States, where Federal Rule of Civil Procedure 53 expressly permits the appointment of special masters to handle pre-trial and evidentiary matters.[8] Acting as independent evaluators, the officers review the contested documents and report findings to the court. Their aim is to ensure the integrity of privilege claims while not delving into the substantive matter of dispute. American courts have deployed this mechanism in a variety of contexts. In Heraeus Kulzer GmbH v. Biomet, Inc., the court relied on a special master to manage extensive discovery disputes involving cross-border documents.[9] Similarly, in Blackman v. District of Columbia, a special master was tasked with ongoing monitoring of compliance with judicial directions.[10] These cases show how special masters not only expedite resolution but also shield the judge from exposure to sensitive or prejudicial material. At the state level, California has gone further by codifying the role of discovery referees under its Code of Civil Procedure, thereby institutionalising the practice in routine litigation.[11] Australia presents a different trajectory. The Australian Law Reform Commission (ALRC), in its influential Report 115 on Discovery in Federal Courts, debated the merits of appointing independent assessors for privilege disputes.[12] While the report stopped short of recommending a wholesale adoption of U.S.-style referees, it acknowledged their utility in managing electronically stored information, especially where the burden of judicial review became unsustainable. Courts in New South Wales and Victoria have since experimented with limited forms of external assistance, reflecting a cautious but pragmatic approach. The United Kingdom, though less reliant on formal referees, has nevertheless witnessed the rise of court-appointed experts in managing disclosure disputes, particularly under the Civil Procedure Rules.[13] The trend across jurisdictions is clear: where litigation involves large volumes of sensitive data, neutral evaluators enhance efficiency, reduce the risk of judicial bias, and foster greater confidence in the process. These comparative experiences suggest that privilege referees are not alien to common law traditions. Rather, they represent a procedural innovation designed to reconcile two imperatives: upholding privilege and ensuring efficient case management. IV. The Need for Privilege Referees in India While comparative jurisprudence demonstrates the value of neutral referees, the case for their adoption in India is even stronger. Indian courts, despite recognising attorney-client privilege in principle, lack a structured procedure for its enforcement. Under the Indian Evidence Act, 1872 and now the Bharatiya Sakshya Adhiniyam, 2023, communications between a client and their legal adviser are protected.[14] Yet, when privilege is contested, the burden of review falls directly on the judge. Given the massive pendency of cases and the complexity of modern evidence, this model is both inefficient and risky. An example may be taken of the functioning of enforcement agencies. While raids are happening, authorities seize entire caches of documents which often far exceeds what is relevant to an investigation. Without any protective measure like a filtration mechanism, privileged communications can inadvertently be accessed undermining the fairness of the proceedings as well as the rights of the individual. The current pillars of protection are good faith of officers and ad hoc judicial intervention, neither of which remains stable and provide consistent safeguards. Another risk which remains is the risk of cognitive bias as judges while review camera evidence of voluminous records is inevitably exposed to sensitive material, even if they didn't include that as evidence. Despite best efforts at neutrality, it is indicated by research in behavioural psychology which suggests that such exposure can create anchoring effects on our unconscious biases, influencing judicial reasoning.[15] A referee system where independent professionals undertake privilege determination, which could prevent this hazard and also preserve the integrity of adjudication. Further, structural precedents within Indian law like the Code of Civil Procedure already allows the appointment of commissioners for local investigation, recording of evidence, or examination of accounts.[16] Similarly, there has been a prevalent culture of appointing an amicus curiae in Indian courts to provide expert assistance in complex matters. Extending the same logic, privilege referees would simply be  another category of neutral facilitator, one designed to cater to the confidentiality requirement of information-heavy disputes. In short, India’s unique combination of judicial backlog, expanding regulatory litigation, and rising data volumes makes the absence of privilege referees particularly glaring. Their introduction would not only improve efficiency but also reinforce constitutional guarantees under Article 21 by ensuring fair and unbiased trials. V. Institutionalising Privilege Referees It is not enough to only recognise the need for privilege referee; this must also be integrated into India’s procedural laws. To institutionalise this, efficiency, fairness and judicial overlooking must be balanced without negating the utmost adjudicatory authority of courts. Order XXVI of the Code of Civil Procedure, 1908, already empowers courts to appoint commissioners for specific procedural purposes.[17] A targeted amendment could extend this provision to allow for the appointment of privilege referees in cases involving large volumes of documents, sensitive electronically stored information (ESI), or complex cross-border privilege issues. Threshold triggers, such as the number of documents or the nature of proceedings, would provide consistency and prevent misuse. Equally important is the neutrality of referees. Borrowing from the U.S. Federal Rules of Civil Procedure, where Rule 53 mandates disclosure of conflicts of interest and allows parties to object,[18] India could create a similar framework. Courts should maintain panels of eligible referees, comprising retired judges, senior advocates, and specialists in commercial litigation. Candidates must disclose conflicts upfront, and parties must be given a reasonable opportunity to raise objections within a fixed time period. The scope of authority also requires careful drafting. Appointment orders should clearly outline the referee’s tasks, such as reviewing documents in camera, categorising privileged material, and providing a reasoned report. While the referee’s recommendations would be non-binding, judges could adopt, modify, or reject them, ensuring that core judicial power is not delegated. Strict timelines, for example 15-30 days for submission and a week-long objection window, would prevent delays. In order to ensure compliance and enforcement, these referees should have the power to impose procedural sanctions, like imposition of costs for non-cooperation, but contempt powers should be reserved solely for the courts. Something similar to Rule 53(c)(2) in the U.S., which allows special masters to penalise parties for misconduct, could be used. Such powers would incentivise parties to cooperate and would make the judicial system more efficient without giving up on control. In order to finance this system, courts could mandate reasonable fees based on the level of complexity and volumes of information involved in the case, and this cost would be distributed amongst the parties. For litigants who cannot afford it or for matters of public interest, a dedicated fund managed through court fees could be set up to subsidise costs for the referees. This would make the system both accessible and reduce inequalities. Lastly, an amendment to the Arbitration and Conciliation Act, 1996 to explicitly give power to arbitral tribunals to appoint privilege referees could be made. This would increase India’s credibility as a global “arbitration hub” amongst the international community. Thus, the concept of privilege referees could be integrated into existing Indian frameworks and fulfil the dual objectives of efficiency and fulfil constitutional mandates. VII. Conclusion To sum it up, the growing volume of sensitive data in regulatory proceedings as well as litigation has made adjudication a recurring challenge for the legal system. The attorney-client privilege does exist in our laws; however, the lack of a structured enforcement process nullifies its existence. Leading in confidentiality, which is the cornerstone of an arbitration proceeding, jurisdictions like the US and Australia demonstrated that privilege referees or special masters can meaningfully reduce judicial burden, prevent inadvertent bias and lastly, protect and safeguard the fairness of proceedings. In India's case, implementation and institutionalisation of privilege referees would not become a hurdle at all. The reason being, order XXVI of the Code of Civil procedure and the Arbitration and conciliation act already allow for the appointment of neutral experts in limited contexts. Similarly, extending these mechanisms to cover privilege will not become an issue of a rigorous law-making exercise. Additionally, the adoption of privilege referees doesn't only signify a mere procedural reform, rather  it's a step towards restoring confidence in India's justice system by ensuring efficiency, neutrality and protection of constitutional guarantees. [1] Law Commission of India, 120th Report on Manpower Planning in Judiciary: A Blueprint (1987). [2] INDIA CONST. art. 20, cl. 3. [3] Bharat Aluminium Co. v. Kaiser Aluminium Technical Services Inc., (2012) 9 SCC 552. [4] Trump v. United States, No. 22-81294-Civ-Cannon, 2022 WL 4234541 (S.D. Fla. Sept. 15, 2022) (US). [5] Waymo LLC v. Uber Techs., Inc., No. C 17-00939 WHA, 2017 WL 2123560 (N.D. Cal. May 15, 2017) (US). [6] Prevention of Money Laundering Act, No. 15 of 2003, §§ 17–18. [7] Bharatiya Sakshya Adhiniyam, No. 45 of 2023, §§ 132–134. [8] Fed. R. Civ. P. 53 (US). [9] Heraeus Kulzer GmbH v. Biomet, Inc., 633 F.3d 591 (7th Cir. 2011) (US). [10] Blackman v. District of Columbia, 633 F.3d 1088 (D.C. Cir. 2011) (US). [11] Cal. Civ. Proc. Code § 639 (West 2022) (US). [12] Australian Law Reform Commission, Report 115: Managing Discovery (2011). [13] Civil Procedure Rules 1998, Practice Direction 31A (UK). [14] Bharatiya Sakshya Adhiniyam, No. 45 of 2023, §§ 132–134. [15] Chris Guthrie, Jeffrey J. Rachlinski & Andrew J. Wistrich, Inside the Judicial Mind, 86 Cornell L. Rev. 777 (2001). [16] Code of Civil Procedure, No. 5 of 1908, Order XXVI. [17] Code of Civil Procedure, No. 5 of 1908, Order XXVI. [18] Fed. R. Civ. P. 53(a)(2)–(3) (US).

INTRODUCTION The airline industry is unpredictable by nature, and financial instability often ends with declaration of insolvency. As airlines are handled with very thin margins of profit, even minor disturbances like a rise in fuel prices, changes in governing regulations or failures in supply changes can cause financial distress.[1] Go First Airlines has recently gone into insolvency, and this has again brought to light gaps in the Indian legal framework regarding airline bankruptcies, specifically regarding rights of lessors. A significant concern in airline insolvencies is the imposed moratorium under the Insolvency and Bankruptcy Code, 2016 (“IBC”).[2] This does not allow aircraft lessors to reclaim their assets, and leaves them helpless for months or even years. This has decreased the confidence of investors in the Indian aviation sector, and led to questions about compliance with various international treaties, like the Cape Town Convention.[3] Apart from financial concerns, a neglected angle of airline insolvency is data privacy concerns. A mammoth amount of passenger data is stored by airlines, and this data can be misappropriated, released or even sold without the customer’s knowledge or consent. A pertinent example in this regard would be the Jet Airways insolvency where the personal frequent flying data of the customer was treated as an asset. BACKGROUND AND CONCEPTUAL FRAMEWORK Airlines encounter high costs of operation, dependence on fluctuating fuel prices, hurdles due to regulators, and high competition, all of which make them susceptible to insolvency.[4] The Indian aviation sector has already seen multiple airlines fail, with some of the most notable instances being Kingfisher Airlines and Jet Airways, with the most recent being Go First Airlines. The IBC applies to corporate insolvency in India, including airlines. Section 14 of the Code, however, stipulates a moratorium period that does not allow lessors to repossess aircraft on commencement of insolvency proceedings. This has led to disharmony between Indian law and the Cape Town Convention (“CTC”). In the Go First case, lessors could not reclaim their aircraft during the moratorium and this led to major monetary losses and a regulatory predicament. Apart from financial concerns, airline insolvency can cause major data privacy concerns. Airlines have access to sensitive personal data of their passengers, including personal information, financial information and travel histories.[5] In cases like Air India’s data breach in 2021, data of millions of customers was endangered and was unprotected from potential misappropriation.[6] Indian legal frameworks fail to regulate how passenger data is handled after and during the insolvency process, and this leads to fears of unauthorised data transactions. CASE STUDIES Go First Airlines and the Lessors’ Dilemma The insolvency of Go First Airlines, filed before the National Company Law Tribunal (“NCLT”) on May 3, 2023, has underscored the conflict between the IBC, and international aircraft leasing protections. The airline owed more than ₹2,660 crore to lessors, as it operated on a lease-based model. The lessors thus were important stakeholders in the insolvency process.[7] However, Section 14 of the IBC imposed a moratorium, preventing lessors from reclaiming their leased aircraft, even though Go First had defaulted on its payments. This legal conflict created significant financial uncertainty for lessors. India has ratified the CTC, which grants lessors the right to repossess aircraft when airlines default.[8] However, due to the lack of full implementation of CTC through domestic law, the NCLT ruled in favour of IBC provisions, effectively barring lessors from reclaiming their assets. The Delhi High Court later allowed some relief, directing the Directorate General of Civil Aviation (“DGCA”) to deregister certain aircraft, but the damage to investor confidence had already been done.[9] In response, the Indian government issued a notification on October 3, 2023, exempting aircraft leases from the moratorium under IBC.[10] While this amendment aligns India with global standards, it raises new concerns about whether such exemptions should apply retrospectively and how they will affect future insolvency proceedings in the aviation sector.[11] Data Privacy in Airline Insolvency – The Jet Airways Case Beyond financial concerns, data privacy remains a critical gap in India’s airline insolvency framework. As already mentioned, airlines have access to gigantic amounts of passenger data. The Digital Personal Data Protection Act, 2023 (“DPDP”) still does not explicitly provide for how such data should be handled after insolvency. A concerning situation had arisen during the Jet Airways insolvency case in 2019. JetPrivilege, a program set up by the airline for frequent flyers, was weighed as one of its most valuable assets during the insolvency proceedings. It was deliberated whether passenger data from this program was to be treated as a saleable asset. Although the program was actually under the ownership of Etihad Airways and worked in isolation, its customer data was heavily discussed in negotiations. This case highlighted the pitfalls of not having clear restrictions on data monetization in similar cases. This is an alarming privacy risk, and could allow potential acquirers, creditors or lessors access to passenger information without their knowledge or consent. To protect its consumers, India must bring in provisions explicitly forbidding the use of passenger data as a sellable and monetizable asset during bankruptcy or insolvency proceedings. INTERNATIONAL FRAMEWORK There is conflict which exists between IBC and the CTC which has raised concerns about India’s credibility in the global aircraft leasing market.[12] However other international jurisdictions have implemented frameworks that protect lessors’ rights as well ensuring smooth insolvency resolution. United States Chapter 11 of the Bankruptcy Code of the US provides for a balanced approach for IBC, unlike India’s IBC, as the repossession under S.1110 of the US Bankruptcy Code allows lessors to reclaim aircraft within 60 days unless the airlines continues payments.[13] In the American airlines restructuring case of 2011, the airline continued operation under the Bankruptcy protection while renegotiating lease agreements with lessors.[14] Now, moving onto the Data privacy aspect, the US airline passenger data is protected under the Federal Trade commission Act and the state level privacy laws. The sale of customer data is strictly regulated, requiring regular oversight. European Union EU also has a similar provision as that of the US Bankruptcy Code that ensures quick asset recovery for aircraft lessors. The EU regulations 2015/848 on Insolvency proceedings provides that there shall be not automatic suspension of the aircraft leasing contract  upon insolvency, ensuring lessors to recover assets efficiently. The case of Alitalia’s insolvency of 2020 where the lessors were able to successfully repossess the aircraft without prolonged legal dispute serves as a good example.[15] Under Art. 5 of the EU’s General Data Protection Regulation, personal data cannot be transferred or sold without user consent, even in insolvency proceedings. The mere failure of an airline does not give creditors the right to access passenger data, ensuring customer privacy. In the Thomas Cook’s insolvency (2019), data privacy authorities ensured that passenger information was not misused, blocking any unauthorized transfers.[16] The Cape Town Convention The CTC of 2001 is the global treaty safeguarding lessors’ rights in airline insolvency. Over 80 countries have adopted CTC. Under Art. XI (Alternative A), lessors have the option of repossessing an aircraft within a set timeframe is an airline defaults. The timeframe is typically 60 days. GAPS IN THE INDIAN LEGISLATIVE FRAMEWORK Aircraft Lessors’ Rights and the Conflict Between IBC and the Cape Town Convention A key issue in Indian airline insolvency law is the conflict between the IBC and the CTC. The IBC imposes a blanket moratorium under Section 14, preventing lessors from repossessing their aircraft once insolvency proceedings commence. This has led to prolonged legal battles, as seen in the Go First insolvency case, where lessors were unable to reclaim their assets for months. While India ratified CTC in 2008, it has not fully implemented its provisions, particularly Alternative A under Article XI, which allows lessors to repossess aircraft within a fixed timeframe of typically 60 days. Countries like Singapore, China, and the UAE have effectively incorporated CTC, ensuring swift aircraft recovery, whereas Indian courts have continued to prioritize IBC over CTC.[17] The October 3, 2023, notification issued by the Ministry of Corporate Affairs (MCA) exempting aircraft leases from the moratorium partially resolves the issue, but it lacks clarity on retrospective application and may not be sufficient to restore investor confidence.[18] Unless India fully incorporates CTC provisions into domestic law, global lessors may continue to see India as a risky jurisdiction for aircraft leasing. Data Protection Gaps in Airline Insolvency While financial concerns dominate airline insolvency discussions, data privacy is an equally pressing issue. Airlines store massive amounts of passenger data, including personal details, passport information, travel history, and payment data. However, DPDP Act, 2023, lacks specific provisions on how customer data should be handled when an airline goes bankrupt. The Jet Airways insolvency (2019) highlighted concerns about customer data being treated as a saleable asset, with discussions around the valuation of its frequent flyer program (“JetPrivilege”).[19] Without strict laws, there is a real risk that airline data could be misused, either by creditors, lessors, or acquiring entities. FILLING THE GAPS Strengthening India’s Airline Insolvency Framework for Lessors The Go First insolvency case has revealed significant weaknesses in India’s legal approach to airline bankruptcies, particularly regarding aircraft lessors’ rights. The IBC, 2016, imposes a moratorium under Section 14, preventing lessors from repossessing their aircraft, leading to prolonged legal battles and financial uncertainty.[20] Although India ratified this treaty in 2008, there has been no clear implementation of the same in domestic law. Indian Courts routinely prioritise IBC over this convention, and thus lessors could not access aircraft for two months in the Go First case. In regard to these concerns, the Ministry of Corporate Affairs did release a notification dated October 3, 2023 to exempt aircraft leases from the moratorium period.[21] However, the retrospective application and enforcement of this notification are still in question. India has currently lost a lot of investor confidence. Some steps that should be mandatorily considered are as follows: i. Incorporation of the provisions of the CTC into domestic law, and enforcing it such that aircraft lessors can reclaim their assets within two months, as per Alternative A under Article XI of the Convention. ii. Ensuring that Indian courts follow the international trend of upholding leasing protections by letting CTC provisions supersede local insolvency law, as done in China, Singapore and the UAE. iii. Creation of specialized aviation insolvency guidelines within IBC, similar to the Aviation Working Group protocols adopted by other jurisdictions. [22] 2.     Protecting Passenger Data in Airline Insolvency – The Jet Airways Case As previously mentioned, data privacy remains a critical gap in India’s airline insolvency framework. Airlines store large volumes of passenger data, including personal details, travel records, and financial information. However, there is no explicit provision under the DPDP Act, 2023, regulating how passenger data should be handled post-insolvency. With reference to the Jet Airways case, it is important that specific provisions are introduced in the DPDP Act, and it ensures that: Passenger data is not a monetizable or sellable asset during insolvency proceedings. Acquirers, lessors or creditors cannot freely access any databases containing customer information without their explicit and informed consent. CONCLUSION Airline insolvencies affect lessors, passengers, and the aviation sector. The Go First case exposed leasing loopholes, while Jet Airways highlighted risks of monetizing passenger data. India must fully implement the Cape Town Convention and strengthen the DPDP Act to protect lessors and ensure data security, boosting investor confidence [1] Business Today, Why Private Airlines Fail So Often in India, May 3, 2023. [2] The Insolvency and Bankruptcy Code, 2016, §14. [3] ICAO, Cape Town Convention and Its Implications for Aircraft Leasing, 2023. [4] The Economic Times, Why Airlines Keep Folding in India’s Booming Market, May 6, 2023. [5] Economic Times, How Airlines Collect and Use Passenger Data: Privacy Risks Explored, June 2021. [6] The Hindu, Air India Data Breach: 4.5 Million Passengers’ Information Compromised, May 2021. [7] Business Today, Go First Files for Bankruptcy, Owes ₹11,000 Crore: Check Debt Breakdown, May 3, 2023. [8] ICAO, Cape Town Convention and Aircraft Leasing Protections, 2023. [9] Delhi High Court, Accipiter Investments Aircraft 2 Ltd. v. Union of India, 2024 SCC OnLine Del 3125. [10] Ministry of Corporate Affairs, S.O. 4321(E): Exemption of Aircraft Leases from IBC Moratorium, October 3, 2023. [11] Economic Times, India’s Aircraft Leasing Market: Impact of the IBC Moratorium Exemption, October 2023. [12] Srinath Sridharan, Why India’s Aviation Sector has Aborted Take-offs for Decades Now, DECCAN HERALD, May 9, 2024, available at https://www.deccanherald.com/opinion/why-indias-aviation-sector-has-aborted-take offs-for-decades-now-3015079 [13] U.S. Bankruptcy Code, 11 U.S.C. §1110 – Rights of Aircraft Lessors in Bankruptcy. [14] American Airlines Bankruptcy Case, U.S. Bankruptcy Court, Southern District of New York, 2011. [15] Reuters, Alitalia’s Aircraft Lessors Win Repossession Rights in EU Court, 2021 [16]The Guardian, Thomas Cook Insolvency: Data Protection Authorities Intervene to Prevent Unauthorized Data Transfers, 2019. [17] UNIDROIT, CTC Implementation Status – UAE, China, and Singapore Case Studies, 2023. [18] Ministry of Corporate Affairs, S.O. 4321(E): Exemption of Aircraft Leases from IBC Moratorium, October 3, 2023. [19] Moneycontrol, Jet Airways’ Frequent Flyer Data Considered a Key Asset in Insolvency Proceedings, 2019. [20]  The Insolvency and Bankruptcy Code, 2016, §14(1); Go First Fallout: India Considers Passing Cape Town Convention Bill to Comfort Foreign Aircraft Lessors, The Times of India, May 14, 2023. [21] BUSINESS STANDARD, Delhi HC Tells DGCA to Clarify Stand on MCA Notification on Moratorium, October 19, 2023. [22] Aviation Working Group (AWG), Impact of India’s IBC on Aircraft Leasing Market, December 2023.

Introduction With the changing nature of the world, arbitration has emerged as a preferred mode of dispute resolution because it emphasises expediency, party autonomy, and finality. When facing disputes, many businesses choose arbitration instead of courts, because it's typically faster, this is an essential aspect when it comes to time-sensitive business matters. It also gives parties more control over the procedure, manner and flow of the proceedings. The Arbitration and Conciliation Act, 1996 [hereinafter referred to as “A&C Act”] has set out to make this a smooth and workable process and thus sets timelines. S.23 (4),[1] an integral rule, mandates that “the submission of the statement of claim and defence be completed within six months from the date of notice of appointment of the arbitrator(s)”. However, whether the nature of this timeline is mandatory or merely regulatory has led to several discussions and developments in my Indian arbitration jurisprudence. This matters because while it does help in resolving disputes quickly when there are strict deadlines, being too rigid about the same may lead to parties being unable to fully present their case. The key is to find the right balance between speed and fairness. Legal Background The 2015 amendment to the A&C Act introduced S.23 (4) and aimed to streamline arbitral proceedings as part of broader reforms in India.[2] This provision provides for a six-month timeline for the submission of claims and defences, starting from the appointment of the arbitrator(s).  The Parliament’s legislative intent shows an attempt at a considered approach to procedural timelines, which can be inferred by the absence of specified penalties for non-compliance.[3] This lack of prescribed consequences has significant implications for the interpretation of this provision. The framework suggests a nature which is of regulatory rather than mandatory nature. Thus, it positions the timeline as a procedural guideline which promotes speedy resolution while still preserving arbitral discretion. This interpretation is in line with the A&C Act's basic principles of party autonomy and procedural flexibility, which are also important tenets of the field of alternative dispute resolution as a whole. The provision must be analysed within India's broader arbitration policy objectives. The legislative history and intent, particularly the Statement of Objects for the 2015 Amendment, demonstrates a commitment to making India a preferred arbitration jurisdiction through enhanced procedural efficiency. It also showcases a procedural safeguard which exists and attempts to promote effective case management while also preserving the authority of the tribunal to adapt timelines based on the specific needs of the dispute at hand.[4] Judicial Interpretation of Section 23(4) Courts have played a very important role in interpreting S.23(4) of the A&C Act, consistently placing emphasis through their rulings on the idea that timelines must serve arbitration's core tenets of efficiency, party autonomy, and justice. The lack of penalties for missing deadlines, as aforementioned, has also led courts to treat Section 23(4) as a regulatory rather than mandatory provision.[5] In the case of ONGC Petro Additions ltd. v. Ferns Construction Co. Inc,[6] it was established that while timelines promote efficiency, they should in no way compromise justice. Arbitrator’s discretion to adjust deadlines was emphasized, when needed to ensure fairness, and to prevent harm coming to either party. Further, the judgement of the State of Bihar v. Bihar Rajya Bhumi Vikas Bank,[7] solidified this principle, when circumstances warrant, tribunals can excuse delays. This approach of Courts reflects a careful balance between efficiency and fairness. Courts have time and again warned against strict timeline enforcement that might lead to dismissals on mere technical grounds, undermining arbitration’s effectiveness.[8] This interpretation also aligns with the broader principle of limited court intervention in alternative dispute resolution mechanisms, particularly arbitration.[9] This non-mandatory nature of timelines is however, not absolute as the parties must demonstrate good faith and not misuse it to create unnecessary delays. Accordingly, the arbitrators should also exercise their discretion carefully, considering the facts and circumstances specific to each case. Comparative Analysis with International Standards The procedural timelines given under S.23 (4) of the A&C Act can be better understood in lines of standards set in international arbitration. Jurisdictions with well- established and well- developed frameworks, such as the United Kingdom, Singapore, and the United States. The tribunals have great jurisdiction over the setting of timelines and there are no strict guidelines for the same The law which serves as the foundation for India’s arbitration law, the UNCITRAL Model Law on International Commercial Arbitration, does not stipulate fixed procedural timelines at all. Instead, everything is left to the discretion of the Tribunal.[10] This is a very flexible approach and is firmly based on the principle of party autonomy, which allows the parties to tailor rules of procedure to the specific needs of their disputes. The Arbitration Act, 1996 of England also lays importance on party autonomy and tribunal discretion, and does not mandate any mandatory timelines like in India.[11] However, the courts in England have held that delays should not affect the efficiency of arbitration negatively. In Soh Beng Tee v. Fairmount Development, the Court stated that procedural rules should ensure fairness without permitting unreasonable delays.[12] Singapore, which is renowned for advanced arbitration practice, has adopted UNICITRAL framework under its International Arbitration Act.[13] The Singapore International Arbitration Centre (SIAC) Rules give tribunals the right to change and alter timelines. This also allows these tribunals to account for facts, circumstances and complexity of case.[14] The Federal Arbitration Act of the United States jurisdiction does not address procedural timelines, and Courts do not usually interfere in the Tribunal’s discretion of power. Arbitrators are bound to make sure of efficient procedure being followed and respecting the party agreements.[15] Mandatory or Directory: The Interpretation of Section 23(4) of the Arbitration & Conciliation Act, 1996 The legislative intent behind the A&C Act is to ensure efficient and expeditious arbitration proceedings. The introduction of statutory timelines under Sections 23(4) and 29A reflects the legislature's intent to curtail delays and promote timely resolution of disputes. Despite this, the interpretation of Section 23(4)—whether it is mandatory or directory—remains a subject of debate Legislative Intent: S. 23(4) of the A&C Act, introduced by the Amendment act of 2019, states that “The statement of claim and defence shall be completed within six months from the date the arbitrator or all arbitrators, as the case may be, received notice, in writing, of their appointment.” Furthermore, this is very much linked S.29 A of the A&C Act, which mandates that the arbitral award in domestic arbitrations must be rendered within 12 months from the completion of pleadings under Section 23(4). The Statement of Objects and Reasons of the 2019 Amendment throws light upon the need for this linkage to ensure expeditious disposal of arbitration cases. Moreover, the High-Level Committee to Review the Institutionalisation of Arbitration Mechanism in India noted that the timelines imposed under Section 29A are uncommon in global arbitration practices, highlighting India’s unique approach for enforcing procedural discipline. Judicial Interpretation: When we look at the court’s interpretation of S.29A, its mandatory nature has been constantly held up. In State of Bihar v. Bihar Rajya Bhumi Vikas Samiti, the SC held that non-compliance with Section 29A extinguishes the arbitrator’s mandate, rendering the proceedings invalid.[16] Furthermore, Telangana HC in Roop Singh Bhatty v. Shriram City Union Finance also concluded that awards issued beyond statutory timelines are null and void.[17] However, the interpretation of Section 23(4) remains less definitive. The Delhi HC in Raj Chawla and Co. Stock and Share Brokers v. Nine Media Information Services Ltd stated that timelines under Section 23(4) are intertwined with the consequences prescribed under Section 29A.[18] The Debate: The language used while framing S.23 (4), reflects prima facie for it to be mandatory, as the term used is “shall”. Furthermore, its connection with S.29A lends more weight to this interpretation, suggesting that the timeline for filing pleadings is crucial for achieving the overall objective of the A&C Act. As observed by the SC in Kailash v. Nankhu, procedural law must be interpreted as a tool to facilitate justice, not as a means to stymie proceedings.[19] The timelines in Order VIII Rule 1 of the CPC were deemed directory, despite their obvious mandatory language, as they did not carry penal consequences. Similarly, if we apply the same reasoning for S.23 (4), it could be construed as directory, allowing procedural flexibility when justice demands. Harmonisation with Section 25: The only potential consequence of non - compliance with S.23(4) can be inferred from S.25 of the A&C Act, which give the Tribunal the authority to terminate proceedings if pleadings are not submitted within prescribed timelines. However, S.25 specifically references Section 23(1), not Section 23(4), suggesting a deliberate legislative distinction. Therefore, this omission raises a solid doubt as to whether S.23 (4) carries the same mandatory character as S.29A. Criticisms and Challenges of Section 23(4) Despite the legislative intent to expedite arbitration proceedings through S.23 (4) of the A&C Act, it has faced criticism and encountered several challenges in its enforcement. Resolving the disputes quickly and expediently and ensuring a fair process, so that no injustice is done are at the two ends of the rope. Firstly, S.23 (4) has a very rigid approach to procedural timelines. This provision mandates the completion of pleadings within six months but it does not explicitly account for the complexities in certain cases, particularly in international or highly technical disputes. Critics argue that the six-month timeline is too short more often, especially when dealing with complex factual matters or when parties are located in different jurisdictions, making the exchange of documents bit tedious. This has led to concerns that the strict enforcement of timelines may result in the denial of justice, as parties may not have sufficient time to fully present their case. Secondly, parties have started to do strategic delays due to the lack of penalties for non-compliance with Section 23(4). The provision’s regulatory nature offers some leeway for extending timelines but there is concern that parties may exploit this flexibility to delay proceedings, especially when there is no clear sanction for failing to meet the deadline. This undermines the objective of expeditious resolution and also to the costs of arbitration, as tribunals are forced to spend additional time managing extensions and delays. Thirdly, the discretion vested in arbitral tribunals under Section 23(4). Even though this discretion is necessary to account for case-specific factors, its broad scope may lead to inconsistent practices across different tribunals. The lack of clear guidelines on when and how delays should be condoned leaves room for subjective decision-making, potentially resulting in unfair outcomes or delays in proceedings.[20] Reform Proposals for Section 23(4) The dynamics of arbitration are evolving, and reforms are needed. The key objective is to uphold the legislative intent of expediting arbitration proceedings while making sure the procedural fairness remains in complex cases. Firstly, the timelines should be extended as it is not pragmatic. The six-month deadline under Section 23(4) for the submission of pleadings may be good for less complex cases. However, it does not allow sufficient time for the submission of claims and defences in intricate matters, especially those with multiple parties or cross-border disputes. Inculcating the power of discretion by the tribunal would allow for a more tailored approach that takes into account the limitations and difficulties of each case.[21] Secondly, to introduce clearer guidelines regarding the discretion of arbitral tribunals. Presently, tribunals have discretion and authority in managing timelines, but this has led to inconsistent practices across different tribunals. A clear and cogent set of criteria for granting extensions, based on factors like the complexity of the case, the parties’ conduct, and external factors like unavoidable circumstances, time zone differences or logistical challenges, should provide less randomization and ensure fairness for all of the parties involved.[22] Thirdly, in some cases, parties delay proceedings on purpose. This could be somewhat solved by imposing penalties upon them, or by restricting them from seeking deadline extensions. Such mandatory guidelines would lead to more strict enforcement, and fewer parties would try to exploit procedural loopholes.[23] Fourthly, including provisions where the tribunal reviews the arbitration process from time to time could be helpful. By mandating that they assess whether the proceedings are moving within the timelines expected, tribunals would be empowered to identify any delays early in the process and could rectify them. This would also lead to speedier disposal of cases.[24] Lastly, submissions could be submitted in phases for particularly difficult and complex cases. The initial pleadings could be submitted within a strict deadline of six months, and detailed submissions could be provided later. This would allow parties to submit all their basic claims and defences to the tribunal and have them placed on record, and would still provide sufficient time for providing more detailed information as evidence.[25] Conclusion Section 23(4) of the Arbitration and Conciliation Act, 1996, has streamlined arbitration timelines but struggles with rigidity, fairness, and case-specific flexibility. Reforms such as extended timelines, clearer tribunal discretion, and strategic delay sanctions are vital to align India’s arbitration framework with global standards, ensuring efficiency, fairness, and adaptability in dispute resolution. [1] Arbitration and Conciliation Act, 1996, § 23(4) (India). [2] Arbitration and Conciliation (Amendment) Act, No. 3 of 2016, Statement of Objects and Reasons, ¶ 1 [3] Justice R.V. Raveendran, Law of Arbitration: Understanding the New Changes, 1(2) IND. J. ARB. L. 45, 49 (2016). [4] Report of the High-Level Committee to Review the Institutionalisation of Arbitration Mechanism in India (2017), ¶ 3. [5] Bharat Aluminium Co. v. Kaiser Aluminium Technical Services Inc., (2012) 9 SCC 552 (India). [6] ONGC Petro Additions Ltd. v. Ferns Construction Co. Inc., 2022 SCC OnLine SC 19 (India) [7] State of Bihar v. Bihar Rajya Bhumi Vikas Bank, 2022 SCC OnLine SC 31 (India). [8] Union of India v. Singh Builders Syndicate, (2009) 4 SCC 523 (India). [10] UNCITRAL Model Law on International Commercial Arbitration, art. 19, U.N. Doc. A/40/17, Annex I (1985). [11] Arbitration Act 1996, c. 23, § 34 (Eng.) [12] Soh Beng Tee v. Fairmount Dev., [2007] SGCA 28. [13] International Arbitration Act, Cap. 143A (1994) (Sing.). [14] Singapore Int’l Arbitration Ctr. Rules, Rule 19.9 (2021). [15] Federal Arbitration Act, 9 U.S.C. §§ 1–16 (1925) (U.S.). [16] State of Bihar v. Bihar Rajya Bhumi Vikas Bank Samiti, (2018) 9 SCC 472. [17] Roop Singh Bhatty v. Shriram City Union Finance, CRP No. 1354 of 2021 (Telangana High Court, Apr. 8, 2022). [18] Raj Chawla and Co. Stock and Share Brokers v. Nine Media Information Services Ltd., 2023/DHC/000580 (Delhi High Court, 2023). [19] Kailash v. Nankhu, (2005) 4 SCC 480. [20] Report of the High-Level Committee to Review the Institutionalisation of Arbitration Mechanism in India (2017), ¶ 4. [21] P.C. Markanda et al., Law Relating to Arbitration and Conciliation in India 148 (10th ed. 2022). [22] Report of the High-Level Committee to Review the Institutionalisation of Arbitration Mechanism in India (2017), ¶ 5. [23] Justice R.V. Raveendran, Law of Arbitration: Understanding the New Changes, 1(2) IND. J. ARB. L. 45, 58 (2016). [24] K.K. Venugopal, Arbitration in India: A Long Road Ahead, 17(1) ASIAN DISP. REV. 16, 20 (2015). [25] Justice Indu Malhotra, The Law and Practice of Arbitration and Conciliation 117 (4th ed. 2021).