While most of our laws deal with the settlement of disputes with the help of the courts, our Parliament has enacted a law which has provided a way to settle disputes out of court. This Act is the Arbitration & Conciliation Act, 1996. We will refer to it from now on as the “Act”. One striking difference between the arbitral and the court process is that an arbitral court, or “tribunal”, as it is more properly called, doesn’t give a judgement but an “award”.

This Act has been amended thrice to meet changing requirements. It has also absorbed, consolidated and amended itself so that it conforms with the Model Law of International Commercial Arbitration and the Conciliation Rules put forward by the United Nations Commission on International Trade Law (UNCITRAL). The Act deals with both domestic and international commercial arbitration.

Arbitration proceedings under the new act have greater freedom than before because the instances where the judiciary could intervene or enter the arbitration proceedings have been reduced. This has been done by reducing the scope and the number of circumstances where arbitral awards could be challenged and by removing the need for confirmation of the arbitral awards.

This Act applies to the whole of India and also covers the enforcement of foreign arbitral awards and the conduct of international commercial arbitration and conciliation.

The Act can be broadly divided into two categories :

• Domestic Arbitration : this term refers to the situation where both the parties and the law governing the arbitration are Indian.
• International Commercial Arbitration and the Enforcement of Foreign Awards : this term applies to the situation where at least one party to the dispute is from another country.

Other types of arbitration are :

• Ad Hoc Arbitration : This refers to a situation when parties settle their dispute amongst themselves without referring it to or taking the assistance of a tribunal.
• Institutional Arbitration : This term refers to a situation where parties agree in a contract that any dispute or difference among them will be settled in accordance to the rules of a particular arbitral institution. The arbitrator (s) are appointed from a panel by the governing body of the institution or by the parties to the dispute. Such an agreement usually contains the rules of the institution “by reference”. An example of such a clause would be “Any dispute between the parties shall be referred to arbitration as per the rules of the International Chambers of Commerce”. The arbitrators are usually assisted by the secretariat of that institution. If the arbitration proceedings are held in India, then the arbitral award will be governed by the Act.
• Specialized Arbitration : When arbitration is conducted by a particular institution based on special rules set up to meet specific requirements to settle disputes of particular types it is called specialized arbitration. For example, an agreement to provide integrated circuits might require specialized arbitration since the dispute is in a very specialized area.
• Statutory Arbitration : When a law specifies that if a dispute arises in a particular case it has to be referred to arbitration, the arbitration proceedings are called “statutory arbitration”. An example of a law which provides for statutory arbitration is the Land Acquisition Act, 1894.

Apart from explaining domestic arbitration, we’ve also attempted to discuss conciliation and “international commercial arbitration”.

PART II - ENFORCEMENT OF FOREIGN AWARDS

Part II of the Act deals with enforcement of foreign awards. It may be divided into two. One which deals with the New York Convention Awards and the other with the Geneva Convention Awards.