India: International Arbitration

Arbitration in India is governed by the Arbitration and Conciliation Act, 1996 as amended from time to time (the “A&C Act”). The A&C Act is divided into two parts. Part I of the A&C Act applies to all arbitration proceedings seated in India, including domestic arbitration between Indian parties as well as international commercial arbitration. ‘International commercial arbitration’ has been defined under Section 2(1)(f) of Part I of the A&C Act, as an arbitration where at least one of the parties is: (i) an individual who is a national of, or habitually resident in, any country other than India; or (ii) a body corporate which is incorporated in any country other than India; or (iii) an association or a body of individuals whose central management and control is exercised in any country other than India; or (iv) the Government of a foreign country. Part II of the A&C Act governs enforcement of foreign arbitral awards under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958 (the “New York Convention”).

Part I of the A&C Act makes several of its provisions subject to parties’ agreement to the contrary. These inter alia include Section 21 (determination of the date on which arbitral proceedings will be seen to have commenced), Section 23 (contents of the statements of claim and defence), Section 26 (power of the arbitral tribunal to appoint experts), Section 29 (decision-making by the majority in a multi-member arbitral tribunal) and Section 31(7) (award of interest by the arbitral tribunal) of the A&C Act. Some of the procedural provisions of Part I of the A&C Act have been specifically made inapplicable to international commercial arbitration and these provisions only apply to domestic arbitration i.e. arbitration seated in India between Indian parties. These inter alia include Section 11(14) (determination of fees payable to arbitrators) and Section 29A (time limit for rendering of the award by the arbitral tribunal) of the A&C Act. Further, the Supreme Court has also interpreted procedural provisions of the A&C Act, such as Section 34(5) (furnishing of prior notice to the award-holder before filing of a petition seeking setting aside of the award), as being non-mandatory (see State of Bihar and Others v. Bihar Rajya Bhumi Vikas Bank Samiti [(2018) 9 SCC 472]). The mandatory provisions under the A&C Act inter alia include requirements as to the form of the arbitration agreement (Section 7), duty of courts to refer parties to arbitration in cases where an arbitration agreement exists (Section 8), grounds for seeking setting aside of arbitral awards (Section 34). Non-compliance with these mandatory requirements may prevent reference of a dispute to arbitration or render the arbitral award unenforceable.

Yes, India is a signatory to the New York Convention. India had ratified the New York Convention and implemented it through the Foreign Awards (Recognition & Enforcement) Act 1961, which has since been repealed and replaced with Part II of the A&C Act, as noted in response to Q.1 above. India has made the following reservations to the application of the New York Convention:

• Only awards made in the territory of other contracting states which have been notified as reciprocating territories by India under Section 44 of the A&C Act will be recognized and enforced; and
• Only awards pertaining to differences arising out of legal relationships, whether contractual or not, which are considered as commercial under the law in force in India will be recognized and enforced.

So far, nearly 50 countries, including all countries with leading international arbitration centres, have been notified as reciprocating territories under Section 44 of the A&C Act.

India is also a party to the Geneva Convention on the Execution of Foreign Arbitral Awards, 1923 (“Geneva Convention”). Other than the New York Convention and the Geneva Convention, India is not a party to any other multilateral treaties or conventions related to arbitration.

Separately, India had also entered into numerous bilateral investment treaties (“BITs”) containing investor-state arbitration provisions with several states. However, 2016 onwards, India has initiated the phased termination of all these treaties and has introduced a new Model BIT as the template for execution of new BITs. Based on this Model BIT, as on date India has signed new BITs or signed Joint Interpretative Notes/Declarations in respect of existing BITs with 6 states (Brazil, Kyrgyz Republic, Republic of Belarus, Republic of Bangladesh, Taiwan and Colombia).

Part I of the A&C Act is largely based on the UNCITRAL Model Law on International Commercial Arbitration, 1985 and the UNCITRAL Conciliation Rules, 1980, with a few variations. These variations include time limit for completion of arbitration proceedings (Section 29A), statutory grounds of independence and impartiality of arbitrators (Section 12), a threshold test for validity of arbitration agreement before courts can refer parties to arbitration (Section 8) and provisions regarding grant of interest (Section 31(7)) and costs (Section 31A).

The A&C Act has been amended thrice since 2015 through the Arbitration and Conciliation (Amendment) Act, 2015 (“2015 Amendment”), the Arbitration and Conciliation (Amendment) Act, 2019 (“2019 Amendment”) and the Arbitration and Conciliation (Amendment) Act, 2021 (“2021 Amendment”). However, some of the provisions of the 2019 Amendment, for establishment of the Arbitration Council of India and amendments to Section 11 (recourse to courts for appointment of arbitrators) of the A&C Act are yet to take effect. Presently, there are no pending proposals or plans before the Indian legislature for further amendments.

However, on a few recent occasions, the Supreme Court of India has expressed its view that some provisions of the A&C Act require further amendments. For instance, in BSNL v. Nortel Network India Private Limited [2021 SCC OnLine SC 207], the Supreme Court recommended that a specific limitation period, shorter than the default limitation period of 3 years under Indian law, be introduced in respect of Section 11 of the A&C Act which permits parties to approach courts for appointment of arbitrators. Similarly, in Pravin Electricals Private Limited v. Galaxy Infra and Engineering Private Limited [2021 SCC OnLine SC 190], the Supreme Court recommended that an amendment be made to Section 37 of the A&C Act so as to grant a right of appeal against court orders passed under Section 11 of the A&C Act.

Here, it may be noted that, being a common law jurisdiction, laws in India routinely undergo judicial reformation, in addition to reformation through legislative amendments. The A&C Act has also evolved significantly through progressive judicial interpretation. Some of the recent instances of such judicial interpretation include permitting of Indian parties to have recourse to foreign seated arbitration (PASL Wind Solutions Private Limited v. GE Power Conversion India Private Limited [2021 SCC OnLine SC 331]) and affirmation of the enforceability of emergency arbitration awards (Amazon.com Investment Holdings LLC v. Future Retail Limited & Others [2021 SCC Online SC 557]).

Prominent arbitral institutions based in India include:

• Mumbai Centre for International Arbitration which was set up in 2016 and published its last revised rules in January 2017;
• Delhi International Arbitration Centre which was set up by the Delhi High Court and whose rules were last amended in July 2018;
• Indian Council of Arbitration which was set up in 1965 and whose rules for international commercial arbitration were last amended in April 2016;
• Nani Palkhivala Arbitration Centre which has its own rules, but largely administers ad hoc arbitrations; and
• New Delhi International Arbitration Centre which has been set by a central legislation in 2019 but is yet to publish its rules and become operational, whereafter it will take over the operations of the existing New Delhi-based International Centre for Alternative Dispute Resolution.

Amongst the international institutions, CIArb has an India chapter, ICC has an India Arbitration Group and SIAC has a liaison office in Mumbai.

The Commercial Courts Act, 2015 (“Commercial Courts Act”) provides for constitution of specialized commercial courts at the district level for handling commercial cases, including those pertaining to arbitration, which are valued at INR 300,000 or above. Similarly, the Commercial Courts Act provides for constitution of dedicated commercial and commercial appellate divisions at the High Courts. Further, some of the High Courts, such as the Delhi High Court, have specially designated some of their commercial benches for hearing of arbitration matters exclusively.

Under Section 47 of Part II of the A&C Act, an application seeking enforcement of a New York Convention award is to be made directly to a High Court. Similarly, under Part I of the A&C Act, applications pertaining to international commercial arbitration, such as applications for interim relief from the court, are to be filed before a High Court. Applications for seeking court’s assistance in appointment of arbitrators are to be filed before the Supreme Court if pertaining to international commercial arbitration, and before a High Court if pertaining to India-seated arbitration between two Indian parties.

Section 7 of the A&C Act prescribes the validity requirements for arbitration agreements. Under this provision, an arbitration agreement is required to be in writing and must capture the agreement between parties to submit disputes which have arisen or may arise between them, whether contractual or not, to arbitration. An arbitration agreement is said to be in writing if it is contained in:

• a document signed by the parties;
• an exchange of letters, emails or other means of telecommunication which provides a record of the agreement; or
• an exchange of statements of claim and defence in which the existence of an arbitration agreement is alleged by one party and not denied by the other.

Notable decisions of the Supreme Court on the validity requirements for an arbitration agreement include:

• In Caravel Shipping Services Private Limited v. Premier Sea Foods Exim Private Limited [(2019) 11 SCC 461] it was clarified that an arbitration agreement does not have to be signed by the parties for it to be considered as valid under Section 7 of the A&C Act.
• In Zhejiang Bonly Elevator Guide Rail Manufacture Company Limited v. Jade Elevator [(2018) 9 SCC 774] the Supreme Court upheld the validity of arbitration clauses which grant the claimant an option between initiating court proceedings or invoking arbitration.
• A reference in a contract to a document containing an arbitration clause is also seen to constitute a valid arbitration agreement if the contract is in writing and the reference is such that it makes the arbitration clause a part of the contract. In the case of Inox Wind Limited v. Thermocables Limited [(2018) 2 SCC 519] it was held that such a reference could also be a general reference to certain standard terms or standard form of contract and the same would be seen to constitute a valid arbitration agreement.
• In Vidya Drolia v. Durga Trading Corporation [(2021) 2 SCC 1] it was held that an arbitration agreement is also required to meet the validity requirements prescribed under the Indian Contract Act 1872. This includes capacity of the parties to enter into a contract (age, soundness of mind, etc), free consent, presence of lawful consideration and a lawful object.

Yes, arbitration clauses are considered separable from the main contract as per Section 16 of the A&C Act. Specifically, Section 16(1)(a) of the A&C Act clarifies that an arbitration clause must be treated as an independent agreement which is separate from the other terms of the main contract. Similarly, Section 16(1)(b) clarifies that invalidity of the main contract shall not, in itself, lead to the conclusion that the arbitration clause contained in it is also invalid. The above statutory principles are also consistently applied in practice by courts in India, led by the Supreme Court which has held that even if the main agreement is null and void, the arbitration clause contained in it continues to be enforceable and valid (see Today Homes and Infrastructure Private Limited v. Ludhiana Improvement Trust and Others [(2014) 5 SCC 68]; Reliance Industries Limited and Another v. Union of India [(2014) 7 SCC 603]).

No, the validation principle applied in some other common law countries has not been applied in any case so far by Indian courts.

The A&C Act does not contain any express provision regarding multi-party or multi-contract arbitration save for Section 8(1) of the A&C Act which allows a non-party to apply to a court to seek reference of a dispute to arbitration, if it can show that it is claiming through a party to the arbitration agreement (see response to Q.12 below). However, institutional rules often contain provisions governing consolidation of arbitration proceedings. For instance, Rule 5 of the Arbitration Rules of the Mumbai Centre for International Arbitration, 2017 (“MCIA Rules”) provides a mechanism for consolidation of two or more arbitrations.

Despite the absence of any other express provision in the A&C Act, the Supreme Court, in the case of P.R. Shah, Shares & Stock Brokers Private Limited v. B.H.H. Securities Private Limited [(2012) 1 SCC 594], has clarified that a common arbitration may be initiated against multiple parties in respect of multiple contracts even if there is no one common arbitration agreement between such parties. As per the above decision of the Supreme Court and other recent judicial precedents (see Global Infonet Distribution Private Limited v. Lenovo (India) Private Limited and Others [2019 SCC OnLine Del 9980]; Cheran Properties v. Kasturi and Sons [(2018) 16 SCC 413]; Ameet Lal Chand Shah v. Rishabh Enterprises [(2018) 15 SCC 678]; Duro Felguera, S.A. v. Gangavaram Port Limited [(2017) 9 SCC 729]), consolidation of arbitration proceedings is warranted where the subject matter of the dispute is interlinked or interdependent. Other factors to be weighed before consolidating arbitrations include considerations of duplicity of proceedings, possibility of conflicting decisions and the probability of injustice if consolidation is not allowed.

The Supreme Court in 2013, in the landmark decision of Chloro Controls India Private Limited v. Severn Trent Water Purification Inc. [(2013) 1 SCC 641], in the context of a foreign seated arbitration under Part II of the A&C Act, had held that a third party claiming through or under one of the parties to the arbitration can invoke the arbitration agreement. The Supreme Court found that, in exceptional circumstances, a third party can be made bound by the arbitration agreement even without its consent if the following elements are found:

• direct relationship of the third party to a party who is signatory to the arbitration agreement;
• direct commonality of the subject matter;
• the agreement between the parties being a ‘composite transaction’; and
• the ends of justice being served by a combined reference of the parties to arbitration.

In this case, the Supreme Court clarified that a ‘composite transaction’ would be one where performance of the main agreement may not be feasible without the aid, execution and performance of supplementary/ancillary agreements and where such supplementary/ancillary agreements would have a bearing on the dispute. The ‘group of companies’ doctrine was also recognized by the Supreme Court in this judgement and this doctrine, along with the test of ‘composite transaction’ have since been applied to arbitrations under Part I of the A&C Act (see Cheran Properties Limited v. Kasturi and Sons Limited and Others [(2018) 16 SCC 413]; Mahanagar Telephone Nigam Limited v. Canara Bank and Others [(2020) 12 SCC 767]).

The above judicially developed principles were legislatively recognized through the changes made to Section 8 of the A&C Act by the 2015 Amendment. Section 8 of the A&C Act deals with a situation where court proceedings have been initiated in ignorance of an arbitration agreement. This provision, as amended by the 2015 Amendment, allows a party or persons claiming through or under one of the parties to the arbitration agreement to request the court or other judicial authority, before which proceedings have been initiated, to refer the dispute to arbitration. In the recent Supreme Court judgement of Vidya Drolia v. Durga Trading Corporation [(2021) 2 SCC 1], it has been held that when such a request under Section 8 of the A&C Act is made, the court/other judicial authority may refer the matter to arbitration and leave issues concerning whether certain parties are bound by the arbitration agreement or not, under the group of companies doctrine or otherwise, for the tribunal to decide. As such, similar to courts, the arbitral tribunal may also decide to hold non-signatories to be bound by an arbitration agreement.

Contracting parties and non-signatories may also mutually agree that the non-signatories will be bound by the arbitration agreement even if none of the above mentioned criteria are satisfied. Here, it may be noted that the Supreme Court in Kerala State Electricity Board and Another v. Kurien E. Kathilal and Another [(2018) 4 SCC 793] has held that given the written form requirement under Section 7 of the A&C Act, if there is no written arbitration agreement between some of the parties seeking reference of their dispute to arbitration, the court can only refer such parties to arbitration after the parties submit a joint affidavit or joint application to the court requesting for the same.

The Supreme Court in 2013, in the landmark decision of Chloro Controls India Private Limited v. Severn Trent Water Purification Inc. [(2013) 1 SCC 641], in the context of a foreign seated arbitration under Part II of the A&C Act, had held that a third party claiming through or under one of the parties to the arbitration can invoke the arbitration agreement. The Supreme Court found that, in exceptional circumstances, a third party can be made bound by the arbitration agreement even without its consent if the following elements are found:

• direct relationship of the third party to a party who is signatory to the arbitration agreement;
• direct commonality of the subject matter;
• the agreement between the parties being a ‘composite transaction’; and
• the ends of justice being served by a combined reference of the parties to arbitration.

In this case, the Supreme Court clarified that a ‘composite transaction’ would be one where performance of the main agreement may not be feasible without the aid, execution and performance of supplementary/ancillary agreements and where such supplementary/ancillary agreements would have a bearing on the dispute. The ‘group of companies’ doctrine was also recognized by the Supreme Court in this judgement and this doctrine, along with the test of ‘composite transaction’ have since been applied to arbitrations under Part I of the A&C Act (see Cheran Properties Limited v. Kasturi and Sons Limited and Others [(2018) 16 SCC 413]; Mahanagar Telephone Nigam Limited v. Canara Bank and Others [(2020) 12 SCC 767]).

The above judicially developed principles were legislatively recognized through the changes made to Section 8 of the A&C Act by the 2015 Amendment. Section 8 of the A&C Act deals with a situation where court proceedings have been initiated in ignorance of an arbitration agreement. This provision, as amended by the 2015 Amendment, allows a party or persons claiming through or under one of the parties to the arbitration agreement to request the court or other judicial authority, before which proceedings have been initiated, to refer the dispute to arbitration. In the recent Supreme Court judgement of Vidya Drolia v. Durga Trading Corporation [(2021) 2 SCC 1], it has been held that when such a request under Section 8 of the A&C Act is made, the court/other judicial authority may refer the matter to arbitration and leave issues concerning whether certain parties are bound by the arbitration agreement or not, under the group of companies doctrine or otherwise, for the tribunal to decide. As such, similar to courts, the arbitral tribunal may also decide to hold non-signatories to be bound by an arbitration agreement.

Contracting parties and non-signatories may also mutually agree that the non-signatories will be bound by the arbitration agreement even if none of the above mentioned criteria are satisfied. Here, it may be noted that the Supreme Court in Kerala State Electricity Board and Another v. Kurien E. Kathilal and Another [(2018) 4 SCC 793] has held that given the written form requirement under Section 7 of the A&C Act, if there is no written arbitration agreement between some of the parties seeking reference of their dispute to arbitration, the court can only refer such parties to arbitration after the parties submit a joint affidavit or joint application to the court requesting for the same.

There have been several recent decisions by the Supreme Court regarding determination of the seat of arbitration and the law applicable to the arbitration agreement where no such law has been specified by the parties. However, the position of law remains unsettled.

In Union of India v. Hardy Exploration and Production (India) Inc. [(2019) 13 SCC 472], where the arbitration agreement provided for arbitration proceedings to be conducted in Kuala Lumpur and they were, in fact, conducted there, the Supreme Court held that India could still be the seat of arbitration and Indian courts would have jurisdiction to entertain a setting aside petition. In this case, the Supreme Court opined that the venue of arbitration can become the seat, supplying the law applicable to an arbitration agreement, only if something else is added to it as a “concomitant”. As such, merely conducting of the arbitration proceedings in Kuala Lumpur was held to be insufficient to dislodge India as the seat of the arbitration and accordingly the A&C Act was held to be the law governing the arbitration agreement. A similar approach was followed in Mankastu Impex Private Limited v. Airvisual Limited [(2020) 5 SCC 399].

Contrary to the above decision, the Supreme Court in BGS SGS Soma JV v. NHPC Limited [(2020) 4 SCC 234] has held that where the parties have failed to specify the law governing the arbitration agreement, then the law of the venue, as provided in the arbitration agreement, would be deemed to the law governing the arbitration agreement unless there is any “contrary indicia” that parties did not intend for the venue to be treated as the seat of arbitration. This view was also adopted by the Supreme Court in the case of Inox Renewables Limited v. Jayesh Electricals Limited [2021 SCC Online SC 448]. Thus, the position of law on this question remains unsettled as on date.

Section 28(1) of the A&C Act provides the mechanism for determining the law applicable to the substance of an international commercial arbitration. It makes parties’ choice the paramount factor and the tribunal is bound to apply the substantive law chosen by the parties. In the event that the parties have not agreed upon a substantive law, the tribunal is permitted to apply the substantive law that it considers appropriate given all the circumstances surrounding the dispute.

So far, there has been no instance before Indian courts of application of transnational principles such as the UNIDROIT Principles of International Commercial Contracts as the substantive law.

As per Section 10(1) of the A&C Act, the parties are free to agree upon the number of arbitrators, but such number shall not be an even number. Section 11(1) of the A&C Act clarifies that an arbitrator may be of any nationality unless otherwise agreed by the parties. However, under Section 12(5) of the A&C Act, a person who lacks independence or impartiality is ineligible to be appointed as an arbitrator and arbitration agreements providing for unilateral appoint of the tribunal are also subject to scrutiny regarding independence and impartiality (see response to Q.20-21 below for details). However, such ineligibility is not absolute and can be waived by the parties through a written agreement after the dispute has arisen.

There are no other restrictions or prescribed qualifications as to who may be appointed as an arbitrator, unless the parties stipulate the same in their arbitration agreement. It may be noted that, under Section 43J of the A&C Act, the yet to be constituted Arbitration Council of India may issue regulations governing the qualifications, experience and norms for accreditation of arbitrators in the future.

Section 10(2) of the A&C Act prescribes that in the event of the parties failing to agree upon the number of arbitrators, the arbitral tribunal shall consist of a sole arbitrator. If the parties have failed to agree upon a procedure for appointment of the arbitral tribunal, Sections 11(3) and 11(5) of the A&C Act stipulate that they should jointly appoint a sole arbitrator or appoint one arbitrator each who shall then appoint the third arbitrator as the presiding arbitrator. If the above fails, any of the parties can apply to the Supreme Court (or the High Court, in cases other than international commercial arbitration) to seek appointment of the arbitral tribunal. Pursuant to amendments introduced by the 2019 Amendment to Section 11 of the A&C Act, the Supreme Court is required to designate arbitral institutions which would decide such applications for appointment of arbitrators. However, these amendments are yet to be brought into force and, for the time being, parties to international commercial arbitration who fail to mutually constitute the arbitral tribunal would have to continue to apply to the Supreme Court for appointment of the same.

As stated in response to Q.18 above, Indian courts can intervene in the selection of arbitrators if the parties fail to appoint the arbitral tribunal and one of the disputing parties applies to the court to seek appointment of the arbitral tribunal under Section 11 of the A&C Act. While deciding such an application, the court must restrict itself to examination of the existence of the arbitration agreement as per Section 11(6A) of the A&C Act. As per the Supreme Court’s decision in Vidya Drolia v. Durga Trading Corporation [(2021) 2 SCC 1], such examination is only to satisfy the court of the prima facie validity of the arbitration agreement.

Indian courts may also intervene in the selection of arbitrators when the same is challenged by a party on the grounds of independence and impartiality under Sections 13 and 14 of the A&C Act. This is explained in detail in response to Q.20 below.

Yes, appointment of an arbitrator can be challenged under Section 13 of the A&C Act. The grounds for challenge are contained in Section 12(3) which states that an arbitrator may be challenged if:

1. circumstances exist that give rise to justifiable doubts as to the arbitrator’s independence or impartiality; or
2. the arbitrator does not possess the qualifications agreed to by the parties.

The grounds stated in the Fifth Schedule of the A&C Act guide the determination of whether circumstances exist which give rise to justifiable doubts as to the independence or impartiality of an arbitrator. The said schedule contains the scenarios listed in the Non-Waivable Red List, Waivable Red List and portions of the Orange List of the International Bar Association’s Guidelines on Conflicts of Interest in International Arbitration, 2014 (“IBA Conflict Guidelines”). Notably, according to Section 12(4) of the A&C Act, a party can challenge its own nominee arbitrator only for reasons which the party becomes aware of after the appointment. An arbitrator that has been appointed by the court under Section 11 of the A&C Act can also be challenged on the grounds contained in Section 12 of the A&C Act as per the Supreme Court’s decision in Konkan Railway Corporation and Another v. Rani Construction Private Limited [(2002) 2 SCC 388].

Section 13(2) of the A&C Act prescribes the challenge procedure as follows:

• The challenging party is required to submit a written statement of its reasons for the challenge to the arbitral tribunal within 15 days of constitution of the arbitral tribunal or upon becoming aware of the circumstances meriting the challenge.
• Unless the challenged arbitrator withdraws, the arbitral tribunal is required under Section 13(3) of the A&C Act to decide on the challenge.
• If the challenge is unsuccessful, the arbitral tribunal will continue the arbitral proceedings and render its award (a decision that can be challenged at the set aside stage under Section 34 of the A&C Act)

Parties may also agree upon a distinct challenge procedure and their freedom to do so is protected under Section 13(1) of the A&C Act.

Separately, it is also possible, and common, for parties to approach the courts under Section 14(2) of the A&C Act to decide whether the mandate of an arbitrator should be terminated and he/she be substituted by another arbitrator on the ground of de jure inability to perform his/her duties due to the abovementioned grounds stipulated in Section 12 of the A&C Act. The Supreme Court in HRD Corporation v. GAIL (India) Limited [(2018) 12 SCC 471)], has clarified that parties can directly approach the court to challenge an arbitrator under Section 14 of the A&C Act if the challenge is based on the Seventh Schedule of the A&C Act. The Seventh Schedule of the A&C Act incorporates both the Waivable Red List and the Non-Waivable Red List prescribed under the IBA Conflict Guidelines. In the same case the Supreme Court also clarified that if the challenge is based on only the Fifth Schedule of the A&C Act (and not the Seventh Schedule) then the process of challenge under Section 13 of the A&C Act would have to be followed and a challenge under Section 14 of the A&C Act would not be available.

Over the past few years, India has witnessed a number of significant developments concerning the duty of independence and impartiality of arbitrators. Through the 2015 Amendment, persons falling within the circumstances listed in the Seventh Schedule of the A&C Act – which incorporates the Waivable Red List and the Non-Waivable Red List prescribed under the IBA Conflict Guidelines – have been made ineligible to act as arbitrators unless the parties agree to their appointment post arising of the dispute. Through the same 2015 Amendment, arbitrators have also been mandated to make disclosures as per a statutorily prescribed format when they are approached in connection with their possible appointment. The 2015 Amendment also introduced the Fifth Schedule of the A&C Act – which contains the scenarios listed in the Non-Waivable Red List, Waivable Red List and portions of the Orange List of the IBA Conflict Guidelines – as the guiding factor for assessing whether circumstances exist which may give rise to justifiable doubts as to the independence or impartiality of an arbitrator.

A common practice followed by Indian government entities is to include contractual provisions for unilateral appointment of the arbitral tribunal by them and for appointment of their current or former employees as arbitrators. Through the below judgements, Indian courts have clarified how such provisions are impacted by the 2015 Amendment:

• In TRF Limited v. Energo Engineering Projects Limited [(2017) 8 SCC 377], the Supreme Court clarified that if a person is ineligible to act as arbitrator due to lack of independence, such person would also be ineligible to nominate the sole arbitrator for a dispute. The above view was reiterated by the Supreme Court in the case of Perkins Eastman Architects DPC v. HSCC (India) Limited [2019 SCC Online SC 1517].
• The Supreme Court has upheld arbitration agreements granting a party the unilateral right to appoint a panel of arbitrators from which the other party would also be required to pick its own nominee (Voestalpine Schienen GmbH v. Delhi Metro Rail Corporation Limited [(2017) 4 SCC 665]). However, such unilateral appointment of a panel has been made subject to the condition that such a panel has to be ‘broad-based’ and not comprised of only a few individuals.
• Despite the above condition, the Supreme Court has also approved the appointment of a panel comprised of merely five former and current employees of one party, from which panel the other party was required to choose its own nominee arbitrator (Central Organization for Railways Electrification v. M/s ECI-SPIC-SMO-MCML (JV) A Joint Venture Company [2019 SCC Online SC 1635]).

While there has been no recent decision similar to the UK Supreme Court’s judgment in Halliburton v. Chubb, a duty of disclosure is already expressly provided for under Indian law. Unlike the UK Arbitration and Conciliation Act 1996, Indian law under Section 12(1) of the A&C Act prescribes a statutory duty of disclosure for arbitrators. As per this provision, when a person is approached in connection with his/her possible appointment as an arbitrator, such person is required to furnish a disclosure in the format prescribed under the Sixth Schedule of the A&C Act. This disclosure must cover circumstances such as the existence of any past or present relationship with or interest in any of the parties or in relation to the subject-matter in dispute, which are likely to give rise to justifiable doubts as to the person’s independence or impartiality. The Fifth Schedule of the A&C Act, which contains the scenarios listed in the Non-Waivable Red List, Waivable Red List and portions of the Orange List of the IBA Conflict Guidelines, has been prescribed under the A&C Act as the guiding factor for determining the existence of justifiable doubts as to a person’s independence or impartiality.

Further, under Section 12(2) of the A&C Act, an arbitrator is duty bound to disclose any of the above circumstances which may arise after the time of appointment and throughout the arbitral proceedings.

Section 14(1) of the A&C Act provides that the mandate of an arbitrator may stand terminated due to any of the following reasons:

• mutual agreement of the parties;
• arbitrator’s withdrawal from office;
• arbitrator becoming de jure or de facto unable to perform his/her functions; or
• arbitrator’s failure to act without undue delay.

Under Section 15(2) of the A&C Act, upon termination of the arbitrator’s mandate for any of these reasons, a substitute arbitrator is to be appointed as per the procedure which was applicable for appointment of the arbitrator who is sought to be replaced. Unless the parties agree otherwise, Section 15(3) of the A&C Act permits the reconstituted arbitral tribunal, at its discretion, to repeat any hearings which were previously held. Similarly, subject to parties’ agreement to the contrary, Section 15(4) of the A&C Act provides that any prior orders shall not become invalid solely because there has been a change in the composition of the arbitral tribunal.

Institutional rules may also deal with the scenario of a truncated tribunal. For instance, Rule 11 of the MCIA Rules provides for replacement of arbitrators inter alia upon a joint request by the parties, resignation by the arbitrator or de jure or de facto inability of the arbitrator to perform his/her functions.

As per Section 42B of the A&C Act, which was brought into effect recently in September 2019, arbitrators are immune from liability. The provision bars filing of any suit or other proceedings against arbitrators in respect of any of their actions which were undertaken or intended to be undertaken in good faith. Prior to introduction of this provision, there was no provision for immunity of arbitrators under Indian law.

Yes, the principle of competence-competence is statutorily recognized in India under Section 16 of the A&C Act. Section 16(1) empowers the arbitral tribunal to rule on its own jurisdiction, including ruling on any objections with respect to the existence or validity of the arbitration agreement. However, there is a significant limitation on the competence of the arbitral tribunal to determine its own jurisdiction in cases where a court, acting under Section 8 or Section 11 of the A&C Act, has referred the dispute to arbitration as opposed to the parties directly initiating arbitration without any prior recourse to the courts. As per several decisions of the Supreme Court (see Shin-Etsu Chemical Company Limited v. Aksh Optifibre Limited and Anr [(2005) 7 SCC 234]; SBP & Company v. Patel Engineering Limited and Anr [(2005) 8 SCC 618]; State of West Bengal v. Sarkar & Sarkar [(2018) 12 SCC 736]), the arbitral tribunal cannot reject jurisdiction once a dispute has been referred to arbitration by a court under Section 8 of the A&C Act or where the arbitral tribunal has been appointed by a court under Section 11 of the A&C Act. The underlying reasoning behind these decisions is that when a referral under Section 8 of the A&C Act or appointment under Section 11 of the A&C Act is made, the court has already reached a positive finding as to the prima facie validity of the arbitration agreement.

When a party commences litigation in apparent breach of an arbitration agreement, the other party may raise an objection under Section 8 (for an India seated arbitration) or Section 45 (for a foreign seated arbitration) of the A&C Act requesting the court (or other judicial authority before which the proceedings have been initiated) to refer the parties to arbitration and to not entertain the court proceedings.

Upon an objection being raised under Section 8(1) of the A&C Act, the court/other judicial authority is mandated to refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists. It may be noted that an objection under Section 8(1) of the A&C Act must, however, be raised no later than filing of the first statement on the substance of the dispute by the party seeking reference to arbitration. To arrive at such a prima facie finding, the following matters are to be looked into as per the Supreme Court’s decision in Vidya Drolia v. Durga Trading Corporation [(2021) 2 SCC 1]:

• whether the arbitration agreement is in writing, as required under Section 7 of the A&C Act;
• whether the core contractual ingredients under the Indian Contract Act 1872, such as capacity of the parties to enter into a contract (age, soundness of mind, etc), free consent, lawful consideration and lawful object are present specifically in respect of the arbitration agreement irrespective of whether the same are present or absent in respect of the main contract; and
• whether the subject matter of the dispute is arbitrable (a reference would be refused on account of non-arbitrability only if the court/other judicial authority is certain that the dispute is demonstrably and plainly non-arbitrable and it is established to be so through a mere summary and preliminary inquiry).

In the same judgement, the Supreme Court clarified that reference to arbitration should be the rule under Section 8 of the A&C Act and only in exceptional cases, where there is no doubt whatsoever that the arbitration agreement is plainly invalid or the dispute is non-arbitrable, should a reference to arbitration be refused. If on a prima facie review no such invalidity or non-arbitrability can be established beyond doubt, the court/other judicial authority is bound to refer the dispute to arbitration as per this judgement of the Supreme Court.

Recently, the Delhi High Court in Parasramka Holding Private Limited and Others v. Ambience Private Limited and Another [2018 SCC OnLine Del 6573] held that an objection under Section 8(1) of the A&C Act does not require filing of a formal application, so long as the requirements of Section 8(2) of the A&C Act are satisfied (i.e. to produce the original arbitration agreement or a duly certified copy thereof) and the objection is raised before the objecting party files any statement on the substance of the dispute.

Similarly, when an application is filed under Section 45 of the A&C Act, the court is mandated to refer the parties to arbitration unless it prima facie finds that the arbitration agreement is null and void, inoperative or incapable of being performed.

As per Section 21 of the A&C Act, arbitral proceedings are deemed to commence on the date of receipt of the request for arbitration by the respondent. Parties may also agree to modify the commencement date.

The Limitation Act, 1963 (“Limitation Act”) prescribes the limitation period for all categories of claims in India. As per Section 43(1) of the A&C Act, provisions of the Limitation Act apply to claims raised through arbitral proceedings. Under Section 20 of the Limitation Act, the limitation period commences when the cause of action arises and a fresh limitation period commences if, within the limitation period, the respondent acknowledges its liability in writing or makes part payment of dues owed.

Notably, the A&C Act does not prescribe a limitation period for filing applications under Section 11 of the A&C Act to the competent court for appointment of the arbitral tribunal. In this regard, the Supreme Court in BSNL v. Nortel Network India Private Limited [2021 SCC OnLine SC 207] has held that residuary limitation period of 3 years under Article 137 of the First Schedule of the Limitation Act would apply to applications under Section 11 of the A&C Act. In this case, the Supreme Court has recommended that the legislature should take steps to introduce a shorter specific limitation period in respect of applications under Section 11 of the A&C Act.

The legislative recognition of the doctrine of sovereign immunity in India can be found in Section 86 of the Code of Civil Procedure 1908, which provides that no suit may be instituted against foreign states in India except with the prior written consent of the Indian government. However, this provision has no application to arbitration proceedings or court proceedings initiated in respect of an arbitration (see Ethiopian Airlines v. Ganesh Narin Saboo [(2011) 8 SCC 539]; Nawab Usmanali Khan v. Sagarmal [AIR 1965 SC 1798]) or to court proceedings initiated for execution of an arbitral award (KLA Construction Technologies Private Limited v. The Embassy of Islamic Republic of Afghanistan and Others [2021 SCC OnLine Del 3424]). As such, it is not possible for a state or state entity to invoke state immunity in connection with arbitration proceedings.

The consequence of a respondent’s failure to participate in the arbitration depends on the stage:

• As noted in response to Q.18 above, failure of the respondent to participate/cooperate, as may be required, at the stage of appointment of the arbitral tribunal is envisioned under Section 11 of the A&C Act. Upon the failure of the respondent to appoint its nominee, Section 11 permits the claimant to approach the courts to seek appointment of the arbitral tribunal.
• After commencement of the arbitration, if the respondent fails to file its statement of defence, Section 25(b) of the A&C Act directs the arbitral tribunal to continue the proceedings without treating that failure in itself as an admission of the allegations made by the claimant. The arbitral tribunal is given the discretion to treat the right of the respondent to file a statement of defence as having been forfeited.
• If the respondent fails to appear at an oral hearing or to produce documentary evidence before the arbitral tribunal, Section 25(c) of the A&C Act empowers the arbitral tribunal to continue the proceedings and make the arbitral award on the basis of the evidence before it. If necessary, the arbitral tribunal also has an option under Section 27 of the A&C Act to seek court assistance for compelling the presence of witnesses or production of evidence.

Additionally, the non-participation / lack of cooperation of a respondent and his/her/its conduct may also be considered as a factor by the arbitral tribunal while determining costs.

Please see the response to Q.12 above. In summary, third parties can voluntarily join arbitration proceedings. In special circumstances such as where the third party is claiming through a signatory, or where the ‘group of companies’ doctrine or judicially developed principle of a ‘composite transaction’ are applicable, the tribunal can direct a non-signatory third party to join the arbitration proceedings. In cases where no such principles are applicable, all the parties may still agree to the third party intervention. However, given the written form requirement under Section 7 of the A&C Act, the tribunal may require furnishing of a joint affidavit or a joint application recording the consent of all the parties to joinder of a non-signatory.

Please see the response to Q.12 above. In summary, local courts can order third parties to participate in arbitration proceedings in India. Courts would pass such an order in limited circumstances such as where the third party is claiming through a signatory, or where the ‘group of companies’ doctrine is applicable or elements of the judicially developed principle of a ‘composite transaction’ are applicable.

Interim measures that an arbitral tribunal can order are provided in Section 17 of the A&C Act. By relying on this provision, a party may, during the arbitral proceedings, apply to the arbitral tribunal:

1. for the appointment of a guardian for a minor or person of unsound mind for the purposes of arbitral proceedings; or
2. for an interim measure of protection in respect of any of the following matters, namely:–

1. the preservation, interim custody or sale of any goods which are the subject-matter of the arbitration agreement;
2. securing the amount in dispute in the arbitration;
3. the detention, preservation or inspection of any property or thing which is the subject-matter of the dispute in arbitration, or as to which any question may arise in the arbitration;
4. interim injunction or the appointment of a receiver;
5. such other interim measure of protection as may appear to the arbitral tribunal to be just and convenient, and the arbitral tribunal shall have the same power for making orders, as the court has for the purpose of, and in relation to, any proceedings before it.

An arbitral tribunal enjoys the same powers for passing interim measures as the local courts, for the purpose of, and in relation to the arbitration.

Pursuant to Section 9 of the A&C Act, local courts can issue interim orders before, during arbitral proceedings or at any time after the making of the arbitral award but before it is enforced in accordance with the A&C Act. Section 9(3) of the A&C Act restricts the power of the court to entertain an application for interim relief once an arbitral tribunal has been constituted. The bar under this provision was recently examined by the Supreme Court in Arcelor Mittal Nippon Steel India Limited v. Essar Bulk Terminal Limited [2021 SCC Online SC 718] where it was held that once an arbitral tribunal is constituted, the court could not entertain, take up for consideration or apply its mind to an application for interim relief under Section 9 of the A&C Act except in cases where the remedy before the arbitral tribunal (under Section 17 of the A&C Act) is rendered inefficacious. However, if the date of the Section 9 application before the court precedes the constitution of the arbitral tribunal, the court may adjudicate the Section 9 application in certain circumstances. When such an application under Section 9 has already been taken up for consideration by the court and is in the process of consideration or has already been considered, the question of examining whether the remedy under Section 17 (before the arbitral tribunal) is efficacious or not does not arise.

Courts in India may issue anti-suit injunction to a party over whom it has personal jurisdiction in appropriate cases. However, the courts exercise this right sparingly and not as a matter of routine. The principles which would guide a court in determining whether to grant an anti-suit injunction were laid down by the Supreme Court in Modi Entertainment Network and Another v. W.S.G. Cricket Pte. Limited [(2003) 4 SCC 341]. In this case, it was held that an anti-suit injunction should not be granted unless the below conditions are satisfied:

• if the injunction is declined, the ends of justice will be defeated and injustice will be perpetuated.
• the principle of comity, i.e. respect for the court in which the commencement or continuance of action/proceeding is sought to be restrained must be borne in mind.
• in a case where more forums than one are available, the court, in exercise of its discretion to grant anti-suit injunction, will examine as to which is the appropriate forum having regard to the convenience of the parties and may grant an anti-suit injunction in regard to proceedings which are oppressive or vexatious or in aforum non-conveniens.
• the burden of establishing that the forum of choice is aforum non-conveniens or the proceedings therein are oppressive or vexatious would be on the party so contending to aver and prove the same.

In a first of its kind case of enforcement of an anti-suit injunction, the Delhi High Court – in Interdigital Technology Corporation v. Xiaomi Corporation Others [2020 SCC Online Del 1633] inter-alia held that it is impermissible for a court in one sovereign jurisdiction to injunct a party before it from pursuing its cause before a court in another jurisdiction, where such latter jurisdiction is the only competent forum; save and except where continuation of the proceedings are vexatious or oppressive to the proceedings pending before the former court i.e. the injuncting court. It was further held that the mere fact that one or other aspect of the controversy may overlap cannot be a ground to grant an anti-suit injunction. In this case, the Delhi High Court ultimately granted an anti-enforcement injunction against an anti-suit injunction passed by a court in Wuhan.

As for anti-arbitration injunctions, while Indian courts have on multiple occasions dealt with applications for the same, the jurisprudence has not been consistent. Certain decisions, such as Kvaerner Cementation India Limited v. Bajranglal Agarwal [(2012) 5 SCC 214] disclaim jurisdiction of civil courts to entertain an application for anti-arbitration injunction on account of the principle of competence-competence enshrined under Section 16 of the A&C Act. At the same time, other decisions like World Sport Group (Mauritius) Limited v. MSM Satellite [(2014) 11 SCC 639] have affirmed the jurisdiction of civil courts to refuse arbitration if the grounds mentioned under Section 45 of the A&C Act are satisfied. This provision permits the courts to disallow an application for reference of parties to arbitration in respect of foreign seated arbitrations when it finds that the arbitration agreement is null and void, inoperative or incapable of being performed. Courts have indicated that the inherent power of granting injunctions from proceeding with arbitration proceedings in foreign-seated arbitration may flow from this provision. Similarly, with respect to India-seated arbitrations under Part I of the A&C Act, Section 8 empowers a court to refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists. It has been argued that Sections 8 and 45 of the A&C Act indicate that the statutory scheme of the A&C Act allows for grant of anti-arbitration injunctions by courts, albeit on a few limited grounds.

In Bina Modi v. Lalit Kumar Modi 2020 SCC OnLine Del 1678 – a recent decision of the Delhi High Court – it was held to be proper for courts to interfere in cases where there is an express bar on the subject-matter arbitrability of certain disputes. Whilst recognizing that the principle of competence-competence was applicable and that the arbitral tribunal had the requisite competence to determine its own jurisdiction, the Delhi High Court held that courts in India have jurisdiction to determine whether an arbitration agreement was null and void and / or oppressive and vexatious and / or the disputes were arbitrable. The decision in Bina Modi has been challenged before the Supreme Court and is pending decision. It remains to be seen how other high courts and the Supreme Court will deal with questions pertaining to jurisdiction for and enforcement of anti-arbitration injunctions.

The A&C Act expressly clarifies than the arbitral tribunal is not bound by statutory rules on evidence contained in the Indian Evidence Act 1872. Instead, evidentiary matters in arbitration are covered under Section 19(4) and Section 27 of the A&C Act. Under Section 19(4) of the A&C Act, the tribunal has the power to determine the admissibility, relevance, materiality and weight of any evidence. Unless otherwise agreed by parties, discretion lies with the arbitral tribunal to decide to hold oral hearings for the presentation of evidence.

Pursuant to Section 27 of the A&C Act, the arbitral tribunal or a party with the approval of the arbitral tribunal can seek the local court’s assistance in taking evidence. This provision can be used to aid domestic as well as foreign seated arbitrations. Pursuant to an application made under Section 27, courts are empowered to issue directions to a party or even a third party to produce documents or summon witnesses if the arbitral tribunal has granted permission and is of the opinion that production of such documents or evidence of such party including third party would be necessary for proper and effective adjudication of the dispute before it (Stemcor (S.E.A.) Pte Limited and Others v. Mideast Integrated Steels Limited and Others [Bombay High Court judgement dated 2 May 2018 in Arbitration Petition No. 332 of 2018]).

Specifically, Section 27(4) of the A&C Act empowers the competent court to issue processes (summonses and commissions) for the examination of witnesses and summonses to produce documents. There are conflicting decisions on the ability of courts under Section 27 of the A&C Act to issue summons to foreign witnesses or issue a commission against them. While the Delhi High Court in Reliance Polycrete Limited v. National Agricultural Co-operative Marketing Federation of India [2008 SCC Online Del 837] came to the conclusion that a local court is bereft of any power to issue process to foreign witnesses, the Bombay High Court in the case of Stemcor (S.E.A.) Pte Limited and Others v. Mideast Integrated Steels Limited and Others [Bombay High Court judgement dated 2 May 2018 in Arbitration Petition No. 332 of 2018] exercised its discretion for the witness to be examined on commission at Singapore. This decision has also been upheld by the Supreme Court subject to limited modifications on modalities.

By virtue of Section 27(5) of the A&C Act, persons failing to attend in accordance with processes or refusing to give their evidence are subject to the like disadvantages, penalties and punishments as may incur for like offences in suits tried before Indian courts.

Rules on professional standards that an Indian advocate needs to follow are mentioned in Chapter II, Part VI of the Bar Council of India Rules. These rules have been prescribed pursuant to Section 49(1)(c) of the Advocates Act, 1961. Accordingly, all advocates are required to follow these rules. As regards foreign law firms and foreign lawyers in India, the Supreme Court’s decision in Bar Council of India v. A K Balaji and Others [(2018) 5 SCC 379] is authoritative. The decision held that foreign lawyers conducting international commercial arbitration proceedings in India will also be governed by the code of conduct applicable to the legal profession in India. Moreover, foreign lawyers or foreign law firms can visit India for a temporary period on a “fly in and fly out” basis for the purpose of giving legal advice to their clients in India regarding foreign law or their own system of law and on diverse international legal issues, so long as the same is a casual visit not amounting to practice. The Supreme Court has left the ambit of what constitutes “practice” – prohibited for foreign lawyers and law firms in India, to be determined by the Bar Council of India / Union of India.

As regards arbitrators – Section 12(1)(b) read with the Fifth Schedule of the A&C Act lists grounds giving rise to justifiable doubts as to the independence or impartiality of arbitrators. Additionally, the Seventh Schedule of the A&C Act lists out circumstances of arbitrators’ relationship between parties or counsel that render a person ineligible to be appointed as an arbitrator. Please refer to response to Q.20 and Q.21 for details.

The 2019 Amendment introduced Section 42A to the A&C Act- an express provision extending the concept of confidentiality to arbitration proceedings. This newly introduced provision is a non obstante clause which enjoins arbitrators, arbitral institutions and parties to the arbitration agreement to maintain confidentiality regarding all arbitration proceedings except the award where disclosure is necessary for the purpose of implementation and enforcement of award.

Till date, Indian courts have not had the opportunity to deal with the admissibility of illegally obtained evidence before an arbitral tribunal under the A&C Act.

Section 31A of the A&C Act stipulates the regime of costs. In determining costs, the arbitral tribunal must have regard to all the circumstances, including: (i) the conduct of all the parties; (ii) whether a party has succeeded partly in the case; (iii) whether the party had made a frivolous counter claim leading to delay in the disposal of the arbitral proceedings; and (iv) whether any reasonable offer to settle the dispute is made by a party and refused by the other party. Additionally, in respect of oral hearings for the presentation of evidence or for oral arguments, the arbitral tribunal may impose exemplary costs on the party seeking adjournment without any sufficient cause.

The A&C Act also provides that the costs of an arbitration are to be fixed by an arbitral tribunal on the general rule that the unsuccessful party shall be ordered to pay the costs of the successful party. But the court or the arbitral tribunal may make a different order for reasons to be recorded in writing. Section 31A(4) of the A&C Act specifically lists orders that an arbitral tribunal may make, including the order that a party shall pay: (i) a proportion of another party’s costs; (ii) a stated amount in respect of another party’s costs; (iii) costs from or until a certain date only; (iv) costs incurred before proceedings have begun; (v) costs relating to particular steps taken in the proceedings; (vi) costs relating only to a distinct part of the proceedings; and (vii) interest on costs from or until a certain date.

The arbitral tribunal’s power to award interest is governed by Section 31(7) of the A&C Act, which is in two parts:

• • Pre-award: Clause (a) of Section 31(7) of the A&C Act pertains to the award of interest for the pre-reference and pedente lite period, which is subject to the parties’ agreement. Absent an agreement between the parties, the arbitral tribunal has the discretion to award interest as it deems reasonable. Interest may be awarded on the whole or any part of the sum awarded.
  • Post-award: Clause (b) of Section 31(7) of the A&C Act pertains to post award interest and is not subject to party autonomy or an agreement between the parties. The Supreme Court has clarified that the arbitral tribunal is also capable of awarding future interest i.e. interest from the date of the award, even on the interest which has accrued during the pendency of the arbitration proceedings between the parties (Hyder Consulting (UK) Limited v. Governor, State of Orissa [(2015) 2 SCC 189]).

In the decision of Vedanta Limited v. Shenzhen Shandong Nuclear Power Construction Company Limited [(2019) 11 SCC 465)] the Supreme Court held that unless otherwise agreed by the parties, the rate of interest awarded must: (i) be governed by the law of the seat of arbitration; (ii) correspond to the currency in which the award is given and the tribunal must not adopt a uniform rate of interest in case of a multi-currency award; and (iii) be guided by factors such as loss of use of principal sum, proportionality, internationally prevailing rates of interest, rate of inflation and whether the rate of interest is commercially prudent.

As regards costs, Section 31A(4)(g) of the A&C Act specifically allows the arbitral tribunal to pass orders for a party to pay interest on costs from or until a certain date.

Provisions governing enforcement of domestic awards are set out in Part I of the A&C Act and the Code of Civil Procedure 1908 (Civil Code). Section 36 of the A&C Act provides that a domestic award is enforceable as a decree of the court after three months from the date on which a signed copy of the same is made available to the parties by the arbitral tribunal (Dakshin Haryana Bijli Vitran Nigam Limited v. Navigant Technologies Private Limited [2021 SCC Online SC 157]). It is only on a specific order of the court that the enforcement of a domestic award can be stayed.

In contrast, recognition and enforcement of a foreign award is governed by Section 47 of Chapter 1, Part II of the A&C Act, which requires furnishing of the following for seeking enforcement of a foreign award:

• the original award or a copy thereof duly authenticated in the manner required by the law of the country in which it is made;
• the original agreement for arbitration or a duly certified copy thereof, and;
• such evidence as may be necessary to prove that the award is a foreign award.

Section 47 of the A&C Act replicates Article IV(1) of the New York Convention.

Recently, the Supreme Court in Gemini Bay Transcription Private Limited v. Integrated Sales Service Limited and Another [2021 SCC Online SC 572] held that the condition under Section 47(1)(c) of the A&C Act i.e. “such evidence as may be necessary to prove that it is a foreign award”, is demonstrated upon compliance of the six ingredients of Section 44 of the A&C Act – namely: (i) it must be an arbitral award on differences between persons arising out of legal relationships; (ii) these differences may be in contract or outside of contract, for example, in tort; (iii) the legal relationship so spoken of ought to be considered “commercial” under the law in India; (iv) the award must be made on or after the 11 October 1960; (v) the award must be a New York Convention award i.e. it must be in pursuance of an agreement in writing to which the New York Convention applies and be in one of such territories; (vi) it must be made in one of such territories which the Central Government by notification declares to be territories to which the New York Convention applies. Once the court is satisfied that the foreign award is enforceable, then, pursuant to Section 49 of the A&C Act, the foreign award is deemed to be a decree of the court.

The requirement that an award be reasoned is mandated under Section 31(3) of the A&C Act in respect of Part I awards (i.e. India-seated awards). This provision specifically requires that an arbitral award state reasons upon which it is based, unless: (i) the parties have agreed that no reasons are to be given; or (ii) the arbitral award is an award on agreed terms under Section 30 of A&C Act (settlement).

The estimated timeframe for recognition and enforcement of an award in India is contingent on a number of factors, including the specific grounds upon which enforcement is resisted, caseload of the competent court, availability of award debtor’s assets etc.

India has made several legislative advancements that facilitate recognition and enforcement of an award, particularly the following:

• Though they constitute two separate stages, a foreign award can be enforced and executed in one composite proceeding. If the enforcing court is satisfied that the foreign award is enforceable, then under Section 49 of the A&C Act, the award shall be deemed to be a decree of that court and the court would then proceed to execute the award by taking recourse to Indian Law applicable to the execution of decrees (Fuerst Day Lawson Limited Jindal Exports Limited [(2011) 8 SCC 333]).
• Excessive formalism in the matter of enforcement of foreign awards has been deprecated. In PEC Limited Austbulk Shipping SDN BHD [(2019) 11 SCC 620] the Supreme Court held that even though Section 47 of the A&C Act provides that the award-holder “shall” produce the evidence required under the provision along with the application for enforcement of a foreign award, this being a procedural requirement, a pragmatic, flexible and non-formalistic approach is to be taken. It was held in this case that the non-production of documents at the initial stage will not entail a dismissal of the application for enforcement and the award holder will be permitted to produce the evidence during the course of the proceedings.
• Recognizing the need to reduce delays in execution proceedings, the Supreme Court in Rahul S. Shah v Jinendra Kumar Gandhi and Others [(2021) 6 SCC 418] has directed courts dealing with execution proceedings to follow mandatory directions, including – immediate execution of decree for payment of money on an oral application and dispose of the execution proceedings within 6 months from the date of filing which may be extended only by recording reasons in writing for delay.
• the Commercial Courts Act (constituting commercial courts at the district level and specialized commercial divisions of High Courts) has introduced various measures, including statutory timelines to improve efficiency and reduce delays to achieve speedy disposal of high value commercial cases including cases pertaining to arbitration.

A party cannot bring a motion for the recognition and enforcement of an award on an ex parte basis. The court must issue a summons to the defendant using the procedure set out in law and the practice rules of the competent High Court. If, despite the summons, the defendant fails to appear before the court, the matter will be heard and decided ex parte.

A court under Chapter I, Part II of the A&C Act reviewing a foreign award is conferred with limited powers to “refuse” enforcement if the grounds under Section 48 of the A&C Act are made out. The grounds under this provision are exhaustive which means that enforcement “may be” refused only if the applicant furnishes proof of any of the conditions contained in that provision. There is ample jurisprudence confirming that the enforcement court cannot correct errors in the award or undertake a review on the merits of the award. Moreover, the use of permissive language in this provision – that enforcement “may be” refused, indicates that even if the award debtor proves the existence of one or more grounds under Section 48 of the A&C Act, the court would retain a residual discretion to overrule the objections, if it finds that the overall justice has been done between the parties and may nevertheless direct enforcement of the foreign award. This is generally done when the ground for refusal concerns a minor violation of the procedural rules applicable to the arbitration, or if the ground for refusal was not raised in the arbitration (see Government of India v Vedanta Limited and Others [(2020) 10 SCC 1]).

In contrast, a domestic award is reviewed in setting-aside proceedings under Section 34(2) of Part I of the A&C Act. The statutory scheme under this provision is in keeping with the UNCITRAL Model Law and the legislative policy of minimal judicial interference in arbitral awards. In other words, the set-aside court cannot undertake an independent assessment of the merits of the award (see MMTC Limited v. Vedanta Limited [(2019) 4 SCC 163]; Ssangyong Engg. And Construction Company Limited v. NHAI [(2019) 15 SCC 131]). This is further underscored by the statutory explanation provided to Section 34(2)(b)(ii) of the A&C Act which clarifies that the test as to whether there is a contravention with the “fundamental policy of Indian law” shall not entail a review on the merits of the dispute. The Supreme Court has made it abundantly clear that the A&C Act makes provision for the supervisory role of courts to review arbitral awards only to ensure fairness (McDermott International Inc. v. Burn Standard Company Limited [(2006) 11 SCC 181). Intervention of courts is envisaged in few circumstances only, such as in case of fraud or bias by the arbitrators, violation of natural justice, etc. The court cannot correct errors of the arbitrators, it can only quash the award leaving the parties free to begin the arbitration again if they so desire.

In its conclusive judgment of Project Director, National Highways Authority of India v. M. Hakeem and Another [2021 SCC Online SC 473], the Supreme Court has clarified that, under Section 34 of the A&C Act, the court may either dismiss the objections for setting aside the award and uphold the award or set aside the award if the grounds contained in sub-sections (2) and (2A) of Section 34 are made out and that the courts have no power to modify an arbitral award.

Save and except the grounds on which enforcement and recognition of an arbitral award can be denied, the A&C Act does not impose any other limits on available remedies.

Awards arising out of India-seated arbitrations can be challenged by making an application for setting aside in accordance with Section 34(2) of the A&C Act. The grounds to set aside an arbitral award almost mirror the grounds under Article 34 of the UNCITRAL Model Law. Under sub-section (a) of Section 34 an award can be set aside on the following procedural grounds:

1. a party was under some incapacity;
2. the arbitration agreement is not valid;
3. the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his case;
4. the arbitral award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matter beyond the scope of the submission to arbitration; or
5. the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties.

Under sub-section (b) of Section 34 of the A&C Act, an India-seated award can also be set aside on the following substantive grounds: (i) the subject-matter of the dispute is not capable of settlement by arbitration under Indian law; or (ii) the arbitral award is in conflict with the public policy of India. Additionally, India-seated awards, other than those emanating from international commercial arbitrations, may also be set aside if the award is vitiated by patent illegality appearing on the face of the award. Section 34 of the A&C Act specifically clarifies that an award shall not be set aside merely on the ground of an erroneous application of the law or by re-appreciation of evidence.

Foreign awards under Part II of the A&C Act cannot be appealed or challenged before Indian courts.

As of date, there is no authoritative judicial pronouncement from the Supreme Court on the question of waiver of rights to challenge arbitral awards. While, in the case of Nirma Limited v. Lurgi Energie Und Entsorgung GMBH and Others [Gujarat High Court judgement dated 19 December 2002 in First Appeal No. 1787 of 2002] it was specifically held that Section 34 of the A&C Act (application for setting aside an award) is not a derogable provision, meaning that parties cannot waive their right to seek setting aside of an India-seated award; the A&C Act has seen numerous amendments and overhauls since this judgement. Generally, Indian jurisprudence does not look favorably upon agreements restricting a party from enforcing his / her rights to approach a relevant court or tribunal, and such agreements restraining legal proceeding could potentially be held to be void under Section 28 of the Indian Contract Act, 1872.

Given that Section 37 of the A&C Act – which pertains to appeals from certain orders under Part I of the A&C Act (illustratively, granting or refusing interim measures, setting aside or refusing to set-aside an arbitral award) – and Section 50 – which pertains to appeals from certain orders passed under Chapter I, Part II of the A&C Act (orders refusing to refer the parties to arbitration or refusing to enforce a foreign award), use the word “shall”, the said provisions can be construed as mandatory and non-waivable by the parties.

Recently, the Delhi High Court in KLA Construction Technologies Private Limited v. The Embassy of Islamic Republic of Afghanistan and Others [2021 SCC OnLine Del 3424] has held that sovereign immunity is not a defence against enforcement of arbitral awards. A foreign state cannot claim sovereign immunity against enforcement of an arbitral award arising out of a commercial transaction. It was held in this case that once a foreign state opts to wear the hat of a commercial entity, it would be bound by the rules of the commercial legal ecosystem and cannot be permitted to seek any immunity, which is otherwise available to it only when it is acting in its sovereign capacity. It is the purpose and nature of the transaction of the foreign state which would determine whether the transaction, and the contract governing the same, represent a purely commercial activity or whether the same are a manifestation of an exercise of sovereign authority.

The case further clarifies that arbitration being a consensual and binding mechanism of dispute settlement, it cannot be contended by a foreign state that its consent must be sought once again at the stage of enforcement of an arbitral award against it.

In respect of a domestic awards:

A domestic award is enforceable against non-signatories if they fall within the parameters of the words “persons claiming under” the signatories in Section 35 of the A&C Act. Section 35 of the A&C Act provides that an arbitral award is final and binding not only on the parties but on persons claiming under them. In post-award enforcement proceedings of Cheran Properties Limited v. Kasturi And Sons Limited and Others [(2018) 16 SCC 413], the issue before the court was whether a non-signatory, who was the nominee of one of the parties, would be bound by the arbitral award. The Court held that the circumstances in which the agreement was entered into would reflect the intention to bind both the signatories and the non-signatory entities within the same group. Factors such as the relationship of a non-signatory to a signatory to the agreement, the commonality of the subject matter, and the composite nature of the transaction are to be taken into consideration. Other factors include the effort to find the true essence of the business agreement, and to unravel layered structures of the commercial arrangement – these are used to determine the intent of the parties to bind a party who is not formally a signatory but has assumed the obligation to be bound by the actions of the signatory. In these circumstances, it was held in this case that the award was binding and enforceable on the non-signatory nominee as he was a person claiming under a party to the agreement.

In respect of a foreign awards:

The Supreme Court in Gemini Bay Transcription Private Limited [2021 SCC Online SC 572] (referred in Q.40 above) examined when non-signatories are bound by a foreign award under Section 44 of the A&C Act. According to the Supreme Court, an application under Section 47 of the A&C Act seeking enforcement of a foreign award, particularly Section 47(1)(c) (“such evidence as may be necessary to prove that the award is a foreign award”) is procedural in nature and does not go to the extent of requiring substantive evidence to “prove” that a non-signatory to an arbitration agreement can be bound by a foreign award. Section 47(1)(c) only speaks of non-substantive evidence as may be necessary to satisfy that the award is a foreign award under Section 44 of the A&C Act.

The non-signatory in Gemini Bay Transcription was not permitted by the Supreme Court to challenge enforcement proceedings. The Supreme Court rejected the non-signatory’s objection that it was not bound by the arbitration agreement on the ground that only a signatory to an agreement can resist enforcement on the ground that the agreement is invalid. The Supreme Court took support from Section 48(1)(a) of the A&C Act which requires any challenge to the award to be mounted by “parties to the agreement“. The Supreme Court did, however, briefly discuss the possibility in appropriate cases for a non-signatory to challenge enforcement of a foreign award under the public policy ground under Section 48(2) of the A&C Act, particularly that enforcement of the foreign award would conflict with the basic notions of morality and justice – however the Supreme Court did not examine this position.

While there have been no specific court decisions in India considering third party funding in connection with arbitration proceedings, the position in India on contingency fees can generally be gleaned from the Supreme Court’s decision in Re: ‘G’, A Senior Advocate of the Supreme Court [AIR 1954 SC 557] where it was held that the English law principles of champerty and maintenance do not stricto sensu apply to the Indian jurisdiction. This means that the mere fact of an agreement being champertous is not in itself sufficient to render it void but it must also be shown that such an agreement is contrary to public policy of India as envisaged under Section 23 of the Indian Contract Act, 1872. Though it was not a direct question before the court, it can be said that whether a third party funding arrangement falls foul of public policy would depend on the terms of the arrangement including the funder’s stake in the award and if the same is determined to be extortionate.

Specifically with respect of litigation financing, the Supreme Court in Bar Council of India v. AK Balaji [(2018) 5 SCC 379], acknowledged that funding of litigation by advocates in India may be impermissible but that “there appears to be no restriction on third parties (non-lawyers) funding the litigation and getting repaid after the outcome of the litigation.” The Supreme Court’s decisions can be extended to third party funding in arbitration. However, whether foreign third party funding of disputes in India would be permissible and to what extent is yet to be seen.

As on date, there is no legislative instrument that regulates such funding. However, the Code of Civil Procedure, 1908 applicable in India, as amended by a few Indian states (Maharashtra, Karnataka, Gujarat and Madhya Pradesh) expressly acknowledges the role of the financier of litigation costs of a plaintiff and sets out the situations when such financier may be made a party to the proceedings. Third party funding has also been referenced in the context of supportive arbitration jurisdiction in the 2017 report of the High Level Committee to review the Institutionalisation of Arbitration Mechanism in India.

Leading arbitral institutions in India have incorporated express provisions for emergency arbitration in their arbitration rules, including – the Delhi International Arbitration Center (Rule 14, Part E, DIAC Rules 2018), Mumbai Center for International Arbitration (Rule 14, MCIA Rules), Madras High Court Arbitration Center (Rule 19, Part IV, Rules 2017), Indian Council of Arbitration (Rule 57(b), Rules of Domestic Commercial Arbitration and Conciliation 2021 & Rule 33, Rules of International Commercial Arbitration 2016), Nani Palkhivala Arbitration Centre (Rule 20(A), NPAC Rules).

The validity of an emergency arbitrator’s award under SIAC Rules was the subject of a recent decision of the Supreme Court in Amazon.com Investment Holdings LLC v. Future Retail Limited & Others [2021 SCC Online SC 557]. In a landmark judgment, the Supreme Court upheld the validity of the emergency arbitrator’s award and equated emergency arbitrator with the arbitral tribunal under the A&C Act. As a result, orders passed by an emergency arbitrator now have the same effect as interim orders passed by the arbitral tribunal under Section 17 of the A&C Act.

The Mumbai Center for International Arbitration (Rule 12, MCIA Rules) provides for an expedited procedure where: (i) the anticipated amount in dispute at the time of the application does not exceed or is equivalent to INR 100,000,000, representing the aggregate of the claim, counterclaim and any set-off defence; or (ii) the parties so agree in writing.

While the A&C Act does not provide for expedited procedure for claims under a certain value, it does provide for a fast track arbitration where the arbitration procedure is to wrapped-up within 6 months. Under Section 29B of the A&C Act, a fast track arbitration can be conducted by the arbitral tribunal by dispensing with numerous technical formalities including by deciding the dispute solely on the basis of written pleadings, documents and submissions filed by the parties without any oral hearing.

provides that a person of any nationality can be an arbitrator unless the parties have agreed otherwise.

Diversity in counsels and lawyers is actively promoted by most law firms in India.

We have not come across any recent court decision setting aside an arbitral award which has been enforced in another jurisdiction or vice versa. Notably, one of the grounds for denying enforcement of a foreign award under Section 48(1)(e) of the A&C Act is that the foreign award has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made.

A notable decision on corruption in arbitration is Swiss Timing Limited v. Organizing Committee Commonwealth Games [(2014) 6 SCC 677]. The Supreme Court in Swiss Timings was concerned with the appointment of a nominee arbitrator and constitution of the arbitral tribunal, where an arbitrability objection was taken on account of pendency of a criminal case under the Prevention of Corruption Act, 1988 (“PC Act 1988”) against certain officials of both parties. Dealing with the issue of arbitrability, the Supreme Court ruled that even where it is alleged that the contract stands vitiated by fraud on account of corruption, such a dispute is arbitrable.

Indian evidentiary law requires the guilt of the accused to be proved beyond reasonable doubt. However, circumstantial evidence is also admissible subject to adherence with certain standards, which include (see Padala Veera Reddy v. State of AP [AIR 1990 SC 79]):

• the circumstances from which an inference of guilt is sought to be drawn, must be cogently and firmly established;
• those circumstances should be of a definite tendency unerringly pointing towards guilt of the accused;

• the circumstances, taken cumulatively, should form a chain so complete that there is no escape from the conclusion that within all human probability the act was committed by the accused and none else; and
• the circumstantial evidence in order to sustain conviction must be complete and incapable of explanation of any other hypothesis than that of the guilt of the accused and such evidence should not only be consistent with the guilt of the accused but should be inconsistent with his innocence.

Moreover, it was held in Gulabchand v. Kudilal [AIR 1966 SC 1734] that, in civil cases, the fact that corruption has taken place is not required to be proved ‘beyond reasonable doubt’ as is required in a criminal case. But this is not to say that courts will not, while striking the balance of probability, keep in mind the presumption of honesty or innocence or the nature of corruption or fraud charged.

As regards burden of proof, there is no specific provision in the A&C Act. Arbitral tribunals are not required to conform to statutory provisions of the Indian Evidence Act, 1872. The rules that are applied in civil cases i.e. the party making a claim must prove it, is generally practiced. However, Indian law also recognizes the reversal of burden of proof from the prosecution to the accused (requiring a party to disprove its involvement in corrupt activities, where prima facie evidence of corruption exists). More specifically, Indian legislation concerning corruption i.e. the PC Act 1988, raises a presumption against the accused, where the burden of proof is on the accused to establish his innocence. Under Section 20(1) of PC Act 1988, the prosecution only has to prove that the accused has received “gratification other than legal remuneration”. When it is shown that the accused has received a certain sum of money, which was not his legal remuneration, the condition prescribed by the section is satisfied and the presumption must be raised. Unless disproved, the statutory presumption continues to hold. However, it is unclear whether an arbitral tribunal is bound by the PC Act 1988, because it ultimately rests on parties’ consent and arbitral tribunal’s discretion to determine evidentiary standards.

Notably, the 2021 Amendment retrospectively amended the proviso of Section 36 of the A&C Act, allowing unconditional stay on the operation of the award, if a prima facie case is made out that the making of the award, was induced or effected by fraud or corruption.

No.

No.

Arbitral institutions in India have taken appropriate measures to factor the COVID-19 pandemic. For instance, the Delhi International Arbitration Center (DIAC) issued a Guidance Note for conducting arbitration proceedings by video conference. The Guidance Note implemented various measures including e-filing of cases, virtual hearings conducted by video conference on Cisco Webex or any other similar platform agreed by the parties, orders to be digitally signed by the arbitrator, and arbitrators can consider recording of evidence through video conference after obtaining requisite consent/declaration from the parties. A duty is cast on all key stakeholders to keep proceedings and contents confidential and for this purpose arbitrators can bind stakeholders through a digitally signed undertaking.

Separately, the Supreme Court has also taken proactive steps to account for COVID-19 pandemic by taking suo motu cognizance of the difficulties that might be faced by litigants in completing their filings within the period of limitation prescribed under the general law of limitation or under any special laws. The Supreme Court issues necessary directions, from time to time, extending the period of limitation and allowing exclusion of appropriate periods in computing the period of limitation under the A&C Act and Commercial Courts Act.

Please refer to response to Q.56 above.

The initiation of corporate insolvency resolution process under the Insolvency and Bankruptcy Code, 2016 (the “Code”) results in the imposition of a moratorium. A moratorium bars the continuation of arbitral proceedings and enforcement action in India.

The purpose of a moratorium includes keeping the corporate debtor’s assets together during the insolvency resolution process, facilitating the orderly completion of the insolvency resolution process and ensuring that the debtor company continues as a going concern. As a result, the mortarium does not restrain proceedings which are to the benefit of the corporate debtor and would not constitute “debt recovery actions” – such that their conclusion would not endanger, diminish, dissipate or impact the assets of the corporate debtor in any manner whatsoever (see Power Grid Corporation of India Limited v. Jyoti Structures Limited [2017 SCC Online Del 12189]; Jharkhand Bijli Vitran Nigam Limited v. IVRCL Limited [2018 SCC Online NCLAT 296]; SSMP Industries Limited v. Perkan Food Processors Private Limited [2019 SCC Online Del 9339]).

Simply put, proceedings that are beneficial to the corporate debtor and do not adversely impact the assets of the corporate debtor will not be impacted by the moratorium. This position is underscored by the ability of the resolution professional, appointed to conduct the insolvency process and whose duty it is to preserve and protect the assets of the corporate debtor, to represent and act on behalf of the corporate debtor in judicial, quasi-judicial and arbitration proceedings (see Section 25(2)(b) of the Code).

Notable decisions in this relation include:

• The Supreme Court inAlchemist Asset Reconstruction Company Limited Hotel Gaudavan Private Limited, [(2018) 16 SCC 94] has held that arbitrations or related proceedings commenced after initiation of the insolvency process are considered non-est in law. This case was specifically aimed at debt recovery.
• Claims made by the corporate debtor and counter-claims made against the corporate debtor in arbitration proceedings can proceed simultaneously. However, on determination, if it is found that the corporate debtor is liable to pay a certain amount, in such case, no recovery can be made during the period of moratorium (see Jharkhand Bijli Vitran Nigam Limited v. IVRCL Limited [2018 SCC Online NCLAT 296]).
• In respect of set-aside proceeding of an arbitral award issued in favour of a corporate debtor, the Delhi High Court in Power Grid Corporation of India Limited Jyoti Structures Limited[2017 SCC Online Del 12189] held that a stay on set-aside proceedings against an award in favour of the corporate debtor would stall the corporate debtor’s effort to recover its money and hence would not be barred by the moratorium. It was held that set-aside proceedings under Section 34 of the A&C Act are a step prior to the execution of an award and are not impacted by the moratorium. Accordingly, the Delhi High Court stated that even where the corporate debtor is the award debtor and the set-aside proceedings are decided against it, such that the award holder moves to execute the award against the corporate debtor, only then would the proceedings seeking to enforce the award against the corporate debtor be barred by the moratorium.

While it is certain that all India seated arbitrations must comply with the moratorium, judicial clarity is required on the impact of moratorium on foreign seated arbitrations involving an Indian party.

India is not a Contracting Party to the Energy Charter Treaty.

India’s first and so far the only concluded climate change litigation was Ridhima Pandey v Union of India (Application No 187/2017, 2017) which invoked the principle of sustainable development, the precautionary principle, the inter-generational equity principle and public truth doctrine; and raised the issue of non-implementation of various acts, relating to conservation, prevention and control of pollution and environmental protection, leading to adverse climate change across the country. The applicant was nine years old at the time of her application, directly affected by adverse climate change and rising global temperatures. She sought the intervention of the National Green Tribunal at Principal Bench, New Delhi (“NGT”) to take effective, science-based action to reduce and minimize the adverse impacts of climate change in India. In January 2019, the NGT disposed of the petition in these terms: “[We] do not consider it necessary to issue any direction … There is no reason to presume that [the] Paris Agreement and other international protocols are not reflected in the policies of the Government of India or are not taken into consideration in granting environment clearances.”

Another case of Swaraj Abiyan v. Union of India and Others [(2016) 7 SCC 498] dealt with failure of certain Indian federal states (Gujarat, Haryana and Bihar) to declare a drought. An argument was made that because of the States’ failure to admit to a drought – the weak in the State were effectively deprived of State assistance that they need to live a life of dignity guaranteed under Article 21 of the Indian Constitution. The Court reached the conclusion that the adverse or negative impact of a delayed declaration of drought affects the common person, particularly women and children, and postpones the assistance that is needed. It also puts an undue strain on the resources of the State Government and the Government of India. All in all, a delayed declaration is of no assistance to anybody whatsoever. The Supreme Court accordingly made eight directions aimed to mitigate the adverse effects that extreme weather has, especially on the most vulnerable in society and to ensure that the State provides the assistance necessary to live a life of dignity. The Supreme Court’s directions included constitution of the National Disaster Response Force and the National Disaster Mitigation Fund, directing the Indian government to formulate a National Plan relating to risk assessment, risk management and crisis management in respect of a disaster at the very earliest opportunity and with immediate concern.

It may be pertinent to note that despite the absence of any recent successful climate change litigation per se, historically, Indian courts have rendered landmark decisions on environmental protection and have also read a right to healthy environment into the constitutionally protected fundamental right to life (Virender Gaur and Others v. State of Haryana and Others [(1995) 2 SCC 577]; A.P. Pollution Control Board II v MV Nayudu and Others [(2001) 2 SCC 62]). Further, an extremely large body of Indian tort law jurisprudence already recognizes the principles of ‘polluter pays’ and ‘public trust’ (M C Mehta v. Kamal Nath [(1996) 1 SCC 38]) and incorporates global environmental law maxims of ‘inter-generational equity’ (State of Himachal Pradesh v Ganesh Wood Products [AIR 1996 SC 149]) and the ‘precautionary principle’ into Indian law (Vellore Citizens Welfare Forum v. Union of India [AIR 1996 SC 2718]). A tradition of environmental activism by India’s courts is also very well established, and, alongside environmental activists and NGOs, courts themselves frequently initiate suo motto inquiries into environmental matters (see for e.g. M.C. Mehta v Union of India [Supreme Court order dated 25 November 2019 in Writ Petition (Civil) No 13029 of 1985]).

India has been a regular attendee at the UNCITRAL Working Group III sessions, however India has not expressed any specific views.

Contributed by: Nitesh Jain (Partner, Trilegal), Juhi Mathur (Senior Associate, Trilegal) and Varun Mansinghka (Associate, Trilegal)