Arbitral Award

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CONUNDRUM SURROUNDING SECTION 42 OF ARBITRATION AND CONCILIATION ACT, 1996

INTRODUCTION

India’s arbitration law is thorough and organic because of its ever-evolving nature, through several amendments and decisions of the courts from time to time. However, the strict wordings of certain provisions contained in the Arbitration and Conciliation Act, 1996 (“Arbitration Act”),have caused a stir, for which courts have had to step in and use the tools of interpretation to resolve such practical dilemmas. Continue Reading Conundrum Surrounding Section 42 of Arbitration and Conciliation Act, 1996

CAN A CHALLENGE TO AN ARBITRAL AWARD BE DISMISSED FOR NON-COMPLIANCE WITH CONDITIONS FOR STAY ON ENFORCEMENT?

An arbitral award can be challenged by filing an application under Section 34 of the Arbitration and Conciliation Act, 1996 (“Act”). Ordinarily, along with the application to set aside an arbitral award, another application is filed under Section 36(2) of the Act seeking a stay on the operation of the award. Prior to the amendment to the Act in the year 2015, mere filing of an application under Section 34 of the Act would lead to an automatic stay on the enforcement of the award. However, pursuant to the Arbitration and Conciliation (Amendment) Act, 2015, Section 36(2) was amended to state that filing of an application to set aside an arbitral award shall not by itself render the award unenforceable and a specific order of stay of operation of the award shall have to be granted on a separate application being made for that purpose. Upon the filing of a separate application, seeking a stay on the operation of the arbitral award, the court may grant the stay, while imposing certain conditions, as it may deem fit. These conditions could entail either furnishing a bank guarantee or depositing cash with the court, to secure the arbitral award. The form and quantum of the security depends on the facts and circumstances of each case and is typically driven by the financial wherewithal and the conduct of the judgment debtor.Continue Reading Can a Challenge to an Arbitral Award be Dismissed for Non-Compliance with Conditions for Stay on Enforcement?

Not Always Beneficial To Make It To The “Hall Of Fame”: Dissecting Delhi High Court’s Decision In Microsoft V. Zoai

In a unique fact scenario, the sole arbitrator, in a domain name dispute between parties, named himself in the “Hall of Fame” for giving a particular type of decision in such disputes. Upon challenge to the arbitral award passed, the Hon’ble High Court of Delhi exercised its powers under Section 34 of the Arbitration and Conciliation Act, 1996 (“the Act”) and set it aside.

This article examines the reasoning given by the Hon’ble High Court to determine what would constitute a reasonable apprehension of bias, and the implications of a court setting aside arbitral awards on grounds of bias when an arbitrator has the “propensity” to pass certain types of orders.Continue Reading Not Always Beneficial To Make It To The “Hall Of Fame”: Dissecting Delhi High Court’s Decision In Microsoft V. Zoai

Arbitration Law

Recently, the Delhi High Court refused to hold a third-party funder liable for furnishing security in enforcement of a foreign award, ruling that the funder — not being either a party to the arbitration agreement, the arbitration, or the eventual award — could not be “mulcted with liability, which they have neither undertaken nor are aware of”. Continue Reading Third party Funding – A funder remains a ‘Third Party” and not a ‘Party’ to the arbitration or award

Disputes

Introduction

The Government of India (“Government”) had announced a one-time voluntary settlement scheme through the Union Budget 2023-24 to settle contractual disputes involving the Government of India or its undertakings. This voluntary settlement process would also be applicable to disputes that have resulted in arbitral awards or court decrees or court orders upholding arbitral awards (hereinafter collectively referred to as “Award”) under challenge. The scheme is called Vivad se Vishwas II (Contractual Disputes). A draft scheme was published for circulation and was open for public comments till March 8, 2023.Continue Reading Execution meeting spirit of the text will determine success of Vivad se Vishwas II