The Arbitration and Conciliation Second Ordinance, 1996

REGISTERED No., DL-33004/96 :,11::za : ... t: <1s1q,1 ~h~ '6a~ette ofr~dia ~o 20) .No. 20] 3TTJT'lffi1JT EXTRAORDINARY \WT 11-~l PART II-Section 1 mflr<fiR ~ ~ ct>I ~Id PUBLISHED BY AUTHORITY ~ ~" tjlj(1ql(, ~ 26, 1996~ 6, 1918 NEW ,DELHI, TUESDAY, MARCH 26, 1996/CHAITRA 6, 1918 ~'\TITf~f~~~~~%~~~3lWT~~~-qt@',jff~I Separate paging is giwu to this Part iu order that it may he filed as a separate compilatiou. MINISTRY OF LAW, JUSTICE AND COMPANY AFFAIRS (Legislative Department) •. __ • •• • • New Delhi, the 26th March, 1996/Chaitra 6, 19!,ft,(Saka) • :THE ARBITRATION ANO CONCILIATION SECO'No ORDINANCE, 1996 No. 11 of 1996 Promulgated by the President in the Forty-seventh Year of the Republic of India. An Ordinance to consolidate and amend the law relating to domestic arbitration, international commercial arbitration and enforcement of foreign arbitral awards as also to define the law relating to conciliation and for matters connected therewith or incidental thereto. · - WHEREAS the United Nation:,; Commission oh International Tr-~<.\e Law (UNCITRAL) frcamble. has adopted the UNCITRAL Model Law · on International Commercial Arbitration in 1985; 11 AND w_HER~s the General Assembly of the United Nations has recommended_ th~t a f co~ntnes gtve due consideration to the said Model Law, in view of the desirability : unifo~ity o_f the law of arbitral procedures .and the specific needs of international nunercial arb11ration practice; 19:.0 WHEREAS the UNCITRAL has adopted the UNCITRAL Concilittion Rules in , ~~o W~EREA.s the General Assembly of the United Nations has recommended the use e s?td Rules in cases where a dispute arises in the context of international tnmerc1al rel t' d h . . . • 0 a tons an t c parues seek an amicable settlement of that d~-pute by . urse to conciliation; .tl~~..;HEREA.s the ~aid Model Law and Rules make significant contribution to the •• putcs ~n.t 0 ~ a. uruficd legal framework for the fair and efficient settlement of ansing m tnten1ational commercial relations; Short title, extent and commence­ ment. Definitions. 2 THE GAZETTE OF INDIA EXTRAORDlNARY [PARTII- AND WHEREAS it is expedient to tnake law respecting arbitration and conciliation, taking into account the aforesaid Model Law and Rules; AND WHEREAS tl)e Arbitration and Conciliation Bill, 1995 to provide for the aforesaid matters was introduced in the Council of Stales but could not be passed; AND WHEREAS the Arbitration and Conciliation Ordinance, 1996 to give effect to the provisions of the sai~ Bill with certain modifications was promulgated by the President on the 16th day of January, 1996 and was brought into force on the 25th day o'r January, 1996; AND WHEREAS Parliament' is not in session and the President is satisfied that circumstances exist which render it necessary for him to take immediate action lo give further continued effect to the provisions of the said Orinance; Now, THEREFORE, in exercise of the nowers conferred by clause (1) of article 123 of the Constitution, the President is pleased to promulgate the following Ordinance:- PRELIMINARY 1. (}) This Ordinance may be called the Arbitration and Conciliation Second Ordinance, I 996. (2) It extends to the whole of India: Provided that Parts I, ill and IV shall extend to the State of Jammu and Kashmir only in so far as they relate lo international commercial arbitration or, as the case may be, international comrnercfat.conciliation. Explanarion.-ln this sub-section, the expression "international commercial conciliation" shall have the same meaning as the expression "international commercial arbitration" in clause if) of sub-section (1) of section 2, subject to the modification that for the word "arbitration" occurring therein, the word "conciliation" shall be substituted. l-.,. . (3) It shall,Ldeemed to have. come into force on the 25th day of January, 1996. PART I ARBITRATION CHAPTER I General provisions 2. (1) In this Part, unless· the context otherwise requires,--, (a) "arbitration" means any arbitration whether or not administered by permanent arbitral institution; (b) "arbitration agreement" means an agreement referred to iu section 7; ' (c) "arbitral award" includes an interim award; ~GAZETTE OF INDIA EXTRAORDINARY 3 (d) "arbitral tribunal" means a sole arbitrator or a pa~el of arbitrators; (e) "Court" means the pril1~ipal Ci~il Cou~t of o~iginal j~sdicii?~ ~ ~ d~t?ct. d • ludes the High Court m exercise of tis ordmary ongmal c1v1l Junsd1ct1on, an . me J"urisdiction to decide the questions forming the. subject-matter of the having d bee h b" f • b • d • l d arbitration if the same l_ia . n t e Slhl ~e~t-~attlcrc? ·1acsmt, ut oes ncot UlC Ur Se anyll civil court of a grade mfenor to sue pnnctpa ivt ourt, or any ourt o ma Causes; (f) "intemational commercial arbitration" means an arbitration relating to disputes • uig out of legal relationships, whether contractual or not, considered as ::~mercial under the law in force in India and 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) a company or 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; (g) "legal representative" means a person who in law represents .the estate of a deceased person, and includes any person who intenneddles with the estate of the deceased, and, where a party acts in a representative character, the person on whom the estate devolves on the death of the party so acting; (h) "party" means a party to an arbitration agreement. (2) This Part shall apply where the place of arbitration is in India. (3) This Part shall not affect any other law for the time being in force by virtue of which certain disputes may not be submitted to arbitration. (4) This Part except sub-section (1) of section 40, sections 41 and 43 shall apply to every arbitration under any other enactment for the time being in force, as if the arbitration were pursuant to an arbitration agreement an<l as if that other enactment were . arbitration agreement, except in so far as the provisions of this Part are incoosist~nt with that other enactment o.- •vith any rules made thereunder. (~ Subject lo the provisions of sulN.e.ction (4), and save in so far as is othawise pro~tded by any law for the time being in force or in any agreement in force between In1dta and any other country or countries, this Part shaU apply to all arbitrations and to a l proceedings relating thereto. '. (6) Where this Part, except section 28, leaves the parties free to determine a certain ~u1e, . that freedom shall include the n. • ght of the parties to authoru.e any person Ille udm • • • -,.-g an mst1tut1on, to detc'rmine that issue. ( 7) An arbitral award mad~· tinder this Part -shall be considered as a <lomeslic award . . 1~8) ~ere this Part- i•• i•.:- • '(a) refers to the fact that the parties have agreed or that they may agree,. or (b) in any other way refers to an agreement of the parties, $cope. Construction of refer­ enL-es. Receipt of written communica­ tions. Waiver of right lo object. Extent of judicial intervention. Adminis­ trative assistance. Arbitration agreement. 4· THE GAZETTE OF INDIA EXTRAORDINARY [P .f\RT [] _ tJ1at agreement shall include any arbitration ·mies rcfem:d to in that agreement. (9) Where this Part, other than clause (cz) of section 25 or clause (a) of suh-s~'.ction (2) of section 32, refers to a claim, it shall also apply lo a counter-claim, and where it refers to a defence, it shall also apply to a defence to that counter-claim. 3. (1) Unless otherwise agreed by the parties,- (a) any written communication is deemed lo have been received -if it is delivered lo the addressee personally or l!-1 his place of business, habitual residence or mailing address, and (b) if none of the places referred lo in clause (a) can be found after making a reasonable inquiry, a written communication is deemed to have been received if it is sent to the addressee's last known place of business, habitual residence or mailing address by registered letter or by any other means which provides a record of the attempt to deliver it. - (2) The commwiic:ation is deemed to have been received on the day it is so delivered. (3) This section does not apply to written communications in respect of proceedings of any jodicial authority. 4. A party who knows that-- (a) any provision of this Part from which the parties may derogate, or (b) any requirement under the arbitration agreement, has not been complied with and yet proceeds with the arbitration without stating his @ objection to such non -compliance without undue delay or, if a time limit _ is provided for ~ stating that objection, within that period of time, shall he deemed to have waived his right to so object. S. Notwithstanding anything .contained in any other law for the time being in force, in matters governed by this Part, no judicial authority shall intervene except where so provided in this Part. • • 6. In order to facilitate ·th~ conduct of the arhitral proceedings, the parties, or the arbitral tribunal with the consent of the parties, may arrange for administrative assistance by a suitable institution or person. CHAPTER ll Arbitration agreement 7. (1) In Chis Part., ''.arbitration agreement" means an agreement by the parties to submit- to arbitration l\U . or. certain disputes which have arisen or which may arise between them ill respect _of a defined legal relationshi}J, whether contractual or not (2) An arbiti:ation agreement ,t~ay be in the fonn of an arbitration clause in a contract or in the fonn ,o.f a, ~cpatatc· !lgtecmcnl. • '· (3) An arbitration agrecmcn~ s,hall be in writing. (4) An arbitration agreement is in writing if it is contained in- SEC. l l THE GAZETTE OF INDIA EXTRAORDINARY ~ 5 (a) a document signed by the parties; (b) an exchange of letters, telex, telegrams or other means of telecommunication which provide a record of the agreement; or (c) an exchange of statements of claim and defence in which the existence of the agr<>,ement is alleged by one party and not denied by the other. (S) The reference in a contract to a document containing an arbitration clause nstitutes an arbitration agreement if the contract is ,in writing and the reference is such : to make that arbitration clause part of the contract. - 8_ (J) A judicial authority before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration. (2) The application referred to in sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly cenified copy thereot: (3) Notwithstanding that an application has been made under sub-section (1) and that the issue is pending before the judicial authority, .m arbitration may be commenced or continued and an arbitral award made. 9. A party may, before or during arbitral proceedings or at any time after the making of the arbitral award but before it is enforced in accordance with section 36, apply to a Court- (i) for the appointment of a guardian for a minor or a person of unsound mind for the purposes of arbitral prcx.-eedings; or (ii) for an interim measure of protection in rcsptx:1 of any of the following matters, namely:- - (a) the preservation, interim custody or sale of any goods which are the subject-matter of the arbitration agreement; (b) securing the amount in dispute in the. arbitration; (c) 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 therein and authorising for any of the aforesaid purposes any person to enter upon any land or building in the possession of any party, or authorising any samples to be taken or any observation to be made, or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full infonnation or evidence; (d) interim injunction or the appointment of a receiver; . (e) such other interim measure of protection as may appear to the Court to be Just and convenient / an: ~he Co~rt shall hav; the same power for making orders as it has for the purpose of, an m relation to, any proceedings before it. .-. " · CHAPTER III Composition of arbitral tribunal Power to refer parties to arbitration where there is an arbitration agreement. Interim measures by Court. lO. • (J) The parties are free to determine the number of arbitrators, provided Number of t such number shall not be an even number. arbitrators. !ii) . Failing the detennination referred to in sub-section (/}; the arbitra,1 tribunal constst of a sole arbitrator. Appoint­ ment or arbitrators. 6 THE GAZETTE OF INDIA EXTRAORDINARY . . [PAITT II- 11. (J) A person or any nationality may ·be an arbitrator, unless otherwise agreed by the parties. (2) Subject to sub-section (6), the parties are free to agree ott Ii procedure for appointing the arbitrator or arbitrators. (3) Failing any agreement referred to in sub-section (2), in an llrbitration with three arbitrators, each party shall appoint one arbitrator, an<l the two appointed arbitrators shall appoint the third arbitrator who shall act as the presiding arbittatot. (4) If the appointment procedure in sub-section (3) applies and~ (a) a party fails to appoint an arbitrator within thirty days from the receipt of a request to do so from the other party; or (b) the two appointed arbitrators fail to agree on the third arbitrator within thirty days from the date of their appointment, the appointment shall be made, upon.,, request of a party. by the Chief Justice or any person or institution designated by him. (5) Failing any agreement referred to in sub-section (2), in an arbitration with a sole arbitrator, if the parties fail to agree on the arbitrator within thirty days from receipt of a request by one party from the other party to so agree the appointment sbail be made, upon request of a party. by the Chief Justice or any person or institution designated by him. (6) Where, under an appointment procedure agreed upon by the parties,­ (a) a party fails to act as required under that procedure; or (b) the parties, or the two appointed arbitrators, fail to reach an agreement expected of -them under that procedure; or (c) a person, including an institution, fails to perform any function entrusted to him or it under that procedure, a party may request the Chief Justice or any person or institution designated by him to take the necessary measure, unless the agreement on the appointment procedure provides other means for securing the appointment. _,_ (7) A decision on a matter entrusted by sub-section (4) or sub-section (5) or sub­ sec~iop (6) to the Chief Justice or the person or institution designated by him is final. ! ~; ! : •. .' •I' • (8) The Chief Justi~e or the person or institution designated by him, in appointing an arbitrator, shall h,v,e due regard to- (a) any qualifications required of the arbitrator-lby the agreement of the parties; and (b) other considerations as are likely to secure the appointment of an independent and impartial arbitrator. (9) In the case of appointment of sole or third arbitrator in an intemational commercial arbitration, the Chief Justice of India or the person or institution designated by him may appoint an _ ;irbitrator of a nationality other than the nationaliJies of the $EC. l] ~ THE GAZETTE OF INDI~ EXTRAORDINARY . h re the parties bckmg lo diffcr:enl nationalities. parllCS W c 7 0 1b. Chief Justice may make such scheme as he may deem appropriate for (~ ) i~h matters entnL'iled by sub-section (4) or sub-section (5) or sub-section (6) deahng w to him. Jl) Where more than one request has been made under sub-section (4) or sub- (. (5) or sub-section (6) to the Chief Justices of different High Courts or their section • h' d • h h h be fi d d • tcs the Chief Justice or Is es1gnate to w om t e request as en 1rst ma e cs1gna , . 1 .. d the relevant sub-sccllon shal alone be competent to decide on 'the request un er (1 2) (a) Where the matters referred to in sub-sections (4), (5), (6), (7), (8) and (10) •se in an intemational commercial arbitration, the reference to ''Chief Justice" in those :b-sections shall be construed as a reference to the "Chief Justice of India". (b) Where the matters referred to in sub-sections (4), (5), (6), (7), (8) and (10) arise in any other arbitration, the reference to "Chief Justice" in th06C sub-sections shall be construed as a reference to the Chief Justice of the High Court within whose local limits the principal Civil Court referred to in clause (e) of sub-section (1) of section 2 is situate and, where the High Court itself is the Court referred to in that clause, to the Chief J usticc of that High Court. 12. (1) When a person is approached in connection with his possible appointment as an arbitrator, he shall disclose in writing any circumstances likely lo give rise to justifiable doubts as to his independence or impartiality. (2) An arbitrator, from the time of his appointment and throughout the arbitral proceedings, shall, without delay, disclose to the parties in writing any circumstances referred to in sub-section (1) unless they have already been informed of them by him. (3) An arbitrator may be challenged only if- (a) circumstances exist that give rise to justifiable doubts as· to his independence or impartiality, or (b) he does not possess the qualifications agreed to by the parties. (4) A party may challenge an arbitrator appointed by him, or in whose appointment he has participated, only for reasons of which he be<..'Omes aware after. the appointment ·• has been made. • • • 13. (1) Subject to sub-section (4), the parties are free to agree on a procedure for an arbitrator. (2) Failing any agreement referred to in sub-section (1), a party who' intends to challenge an arbitrator shall, within fifteen days after becoming aware of the constitution of l~le arhitral tribunal or after becoming aware of any circumsl;l,nc;es referred to in sub­ ~t~on. (3) 0 ~ section 12, send a written statement of the reasons for .the challenge to e arb11ral tribunal. .• . . '• (J) U~less th • • b't • • h II · • • · f h' ffi or the ot . _c ar . ' rator c a engcd undct sub-scct~on (2) __ wt1hdraws frof!l: . IS o 1cc her party agrees to the challenge, the arb1tral tribunal shall decide on the Grounds for challenge. Challenge procedure. (4) If a chall ·n d • · :. d .·h_ .. ,, • • 1: gc un er a1~y procedure agreed upon by the parties or uri er I t· J?ccdure under ,. h . . • . . . . . 1 . • h-. • • . . .,u -section (2) IS not suecesstul, &he arb11ral tribunal shat contmue I c Ira) procced11 d ., .. 1gs an make an arbitml award. • · '' '· Failure or impossi­ bility lo act. 1 ennination of mandate and snbsti­ tµtion of arbitrator. Competence of arbitral tribimal to rule on its jurisdiction. 8 THE GAZETTE OF INDIA EXTRAORDINARY [PART II- (5) Where an arbitral award is made under. sub-section ( 4), the party challenging the arbitrator may make an application for selling aside such an arbitral award in _accordance wit.h section 34. : {6) W11crc an arbitral award is set aside on a.n application made under sub-section (5), the Court may decide as to whether the arbitrator who is challenged is entitled to any fees. 14. (J.) The mandate of an arbitrator shall terminate if- (a) he becomes de jure or de facto unable to perform his functions or for other reasons fails to act without undue delay; and (b) he withdraws from his office or the parties agree to the tennination of his mandate. (2) If a controversy remaill.5 concerning any of the grounds referred to in clause (a) of sub-section (J), a party may, unless otherwise agreed by the parties, apply to the Court to decide on the termination of the mandate. (3) If, under this section or sub-section (3) of section 13, an arbitrator withdraws from his office or a party agrees to the termination of the mandate of an arbitrator, it shall not imply acceptance of the validity of any ground referred to in this section or sub-section (3) of section 12. 15. (J) In addition to the circumstances referred to in section 13 or section 14, the mandate of a11 arbitrator shall tenninate- (a) where he withdraws from office for any reason; or (b) by or pursuant to agreement of the parties. (2) Where the mandate of an arbitrator terminates, a substitute arbitrator shall be appointed according fo the rules that were applicable to the appointment of the arbitratbr being replaced. (3) Unless otherwise agreed by the parties, where an arbitrator is replaced under sub­ section (2), any hearings previously held may be repeated at the discretion of the arbitral tribunal. (4) Unless otherwiseagrced by the parties, an order or ruling of the arbitral tribunal made prior to the replacement of an arbitrator under this section shall not be invalid sokly because there has been a change in the composition of the arbitral tribunal. CHAPTER JV Jurisdiction of arbitral tribunals I 16. (1) The arbitral tribunal may rule OQ its own jurisdiction, including ruling on any objections with respect to the existence ot validity of the arbitration agreement, and for that purposc,- (a) an arbitration clause which forms part of a contmct shall be treated as an agreement independent of the other tenns of the contract; and • (b) a decision by the arbitral .lribunal that the contract is null arid' void shall not entail ipso jure the invalidity of the arbitration clause. 5,:c. IJ --~ ~·-- THE GAZE1TE OF INDIA EXTRAORDINARY 9 1k·1 that the arhitral tribunal docs not have jurisdiction shall be raised not later (2) A 1 1' iission of the statcmcn! or dcfrncc; however, a party shall not be pr,~cludcd h the " 1 m • • t an . :'. • ,, such a plea mt:rcly because that he has appointed, or part1cipatc<l in the frotn ra 1slllo • . • • 1 ·nt or an arbitrator. appolll me. ' 3 A pica tb:it the arhitral trihw1al is exceeding the scope of its authority shall he . ( J) .. ::;oon as the matkr alleged to be beyond the scope of its authority is raised raise a::. • . tli . mbitral proceedmgs. Junng c (4) Thi.'. arbitral tri_bunal may, in either of the cases referred to in ~ub.-section (2) or \ ~····lion (3), adm1l a later plea if it considers the delay justified. Sll l-~~- (5) Tiic arbitral tribunal shall decide on a pica referred to in sub-section (2) or sub­ seetion (3) and, where tl~e arbitral tribunal tak~s a decision rejecting the plea, continue with the arbitral proceedmgs and make an arh1tral award. (6) A party agg_ricved by s~ch an arbitral a:vard m_ay make an application for se\ting aside such an arb1tral award tn accordance with sectton 34. 17. (J) Unless otherwise agw~d by the parties, the arbitral tribunal may, at the request of a party, order_ a par1y to ta~c any interim me~ure of protection :15 the arbitral tribunal may consider necessary m respect of the subject-matter of the dispute. (2) TI1e arbitral tribunal may require a party to provide appropriate security in connection with a mcas11""· ordered under sub-section (1). CHAPTER V Conduct of arbitral proceedings ·18. The parties shall be treated with equality and each party shall be given a full opportunity to present his ca.<;~. )9. (1) The arbitral tribunal shall not be bound by the Code of Civil Procedure, 1908 or the Indian Evidence Act, 1872. (2) Subject to this Part, the parties are free to agree on the procedurl'. to be followed the arbitral tribunal in conducting its proceedings. (J) Failing_ any agr·~emcnt reL:rred to in sub-section (2), the arbitral tribunal may, lo this Part, conduct the proceedings in the manner it considers appropriate. (4) The. power of the arbitral tribunal under sub-section (3) includes the power to the admissibility, relevance, materiality and weight of any evidl'.nce. ZO. (1) TI1e parties are free to agree on the place of arbitration. <l . Fail~ng any agreement referred to in si1b.-section (]), the place of arbitration shall etenn111e<l by ti • h' 1 'b 1 • • le ar lira !rt una havmg regard to tl1e ctrcumstances c/. the case, the convenience of the parties;· Notwithsta.i d" , . l . . . . . • 1 111), su J-sectton (]) or sub-se~t1011 (2), the arb!lral tnbunal tnay, unless ag.reed b~ the parties; meet at miy place it considers appropriate for al11ong !ls members fo( hearing wilncsscs experts or the p"•tics or for of d . . ' .. ' ' "" ' ocumcnts, goods or other property. Interim measures ordered by arbitral tribunal. Equal treatment of parties. Determina­ tion of rules of procedure. Place of arbitration. Commcncc­ mcnl of arbitral !Jluccctlings. Language. Statements of-daim and defence. Hearings and written proceedings. Default of a party. 10 THE GAZETTE OF lNDIA EXTRAORDINARY I PART II 21. Unless otherwise :1grced by the parlks; the arbitral procct.:dings in respect of a particular dispute com1m:nee on the date on which a request for that dispute to be referred to arbitrali<ill is received by the respondent. 22. (]) The parties arc free to agree upon the l:mguagc or languages to be t1,c<l in the arbitral proceedings. (2) Failing any agreement 1cfr1n:d lo in sub-section (/ ), the arbitral tribtmal shall dctcnnine the language or languages to be used in the arbitral proceedings. (3) l11c agreement ·or dcfcnnination, rn1kss olhc:1wisc spccilicd, shall apply lo any wrillen statement by a pat!y, any hearing and any arbitral award, decision or other communication by the arbitral tribunal. (4) The arbitral tribunal may order that any documentary evidence shall be accompanied by a translation into the language or languages agreed upon by the parties or dctcnnincd by the arbitral tribunal. 23. (]) Within the period of time agreed upon by the parties or dctennincd by the orbitral tribunal, the daimant shall state the facts supporting his claim, the points at issue and the relief or remedy sought, and the respondent shall stale his defence in respect of these particulars, unless the parties have otherwise agreed as to the required clements of those statements. (2) 111c parties may submit with their stalcmt:nts all documents they consider \o be. relevant or may add a reference to the documents or other evidence they will submit. (3) Unless otherwise agreed by the parties, either party may amend or supplement his claim or defence during the course of the arbitral proceedings, unless the arbitral . tribunal considers it inappropriate to allow the amendment or supplement having regard , to the delay in making it. 24. (1) Unless otherwise agreed by the parties, the arbitral tribunal shall decide whether to hold oral hearings for the presentation of evidence or for oral argument, or whether the proceedings shall be conducted on the basis of documents a~d other materials: Provided that the arbitral tribunal shall hold oral hearings, al an appropriate stage of the proceedings, on a request by a party, unless the parties have agreed that no oral hearing shall be held. (2) The ·parties shall be given suflicient advance notice of any hearing and of any meeting of the arbitral tribunal for the purposes of inspection of documents, goods or other property. (3) All statements, documents or other information supplied to, or applications made to the arbitral tribunal by one party shall be communicated to the other party, and any expert report or cvidcntiary document on which the arbitral tribunal may rely in making its decision shall be communicated to the parties. / 25. Unless otherwist: agreed by the parties, where, without showing sufficient calL<;C,- (a) the claima.11I fails to comm1micate his statement of claim in accordance with sub-section (1) of section 23, the arbitral tribunal shall tcnninatc the proceedings; $Ee. ll THE GAZETTE OF INDIA EXTRAORDINARY 11 b the rcspcndent fails to communicate his statement of defence in accordance . ~ ) b-scction (1) of section 23, the arbitral tribunal shall continue the proceedings w!t1 5tlt trcatin•' that failure in itself as an admission of the allegations by the wtt 10U o claimant; (c) a party fails to appear at an oral hearing or to produce documentary evidence, the arbitral tribunal may continue the proceedings 2?1d make the arbitral award on the evidence before it. 26, (1) Unless otherwise agreed by the parties, tpe arbitral tribunal may- (a) appoint one or more experts to report to it on specific issues to be detcnnincd by the arbitral tribunal, and (b) require a party to give the expert any relevant infonnation or to produce, ~r to provide access to, any relevant documents. goods or other property for his inspection. {2) Unless otherwise agreed by the parties, if a party so· requests or if the arbitral tribunal considers it necessary, the expert shall, after delivery of his written or oral . report, participate in an oral hearing where the parties have the opportunity to put ) iueslions to him and to present expert witnesses in order to testify on the points at ·issue. :. (3) Unless otherwise agreed by the parties, the expert shall, on the request of a party, :irlake available to that party for examination all documents, goods or other property in the possession of the expert with which he was provided in order to prepare his report . . 27. (1) The arbitral trihW1al, or a party with the approval of the arbitral tribunal, may apply to the Court for assistance in taking evidence. (2) The application shall spccify- (a) the names and addresses of the parties and the arbitrators; (b) the general nature of the claim and the relief sought; (c) the evidence to be obtained, in particular,- . (i) the name and addr,':SS or any person to be heard as witness or expert Wllncss and a :.tatement oi' the subject-matter of the testimony required; (ii) the description of any docutncnt to be produced or property to be inspected. The Court may, within its competence and according to its n1lcs • on taking ., .......... •• ;',;.,·•·~i;ncc •. execute the request by ordering that the evidence be provided directly to the tnhuu:il. ,, Wn<;; procc~Thscsc Cou_rt may, while tn:iking an order under sub-section (3), issue the same to wztnc:;scs as it may issue in suits tried before it. ' }~1~crsons _fa~ling to attend in accordance with such process, or making any other ' unai 0l r~IUSlng to give their evidence, or guilty of ·any contempt to the arbitr;tl dvan\a u:ig _the . c~nduct o~ arbitral proceedings, shall be subject to the like • g • penalties and punishments by order of the Court on the representation of Expert appointed by arbitral tribunal. Court assistance in taking evidence. Rules appli­ cable to substance of dispute. Decision making by panel of arbitrators. Settlement. l 2 THE GAZElTEOF INDIA EXTRAORDINARY !P,wrll~ the arbitral tribunal as they would incur for the like offence,-; in suits tric<l before the Court. (6) In this section lhe expression "Processes" iJl(:ludcs summonses a.11<l com111is.sious for the examination of witnesses :u1d SllllllllOIL<;cs lo produce documents. CHAPTER VI Making of arbirral award and termirwtion of proceeding:,; 28. (J) Where the place of arbitration is situate in India,- (a) iu an arbitration other than an international commercial arbitration, the arbitral tribunal shall decide the dispute submillcd to arbitration in accorda.r1cc with the substantive law for the Lime being in force in India; (b) in international commercial arhitration,- (i) the arbitml tribunal shalt deddc the dispute in accordance with the rules of law designated by the parties as applicable to the substance of the dispute; (ii) any designation by the parties of the law or legal system of a given country shall be construed, unless otherwise expressed, as directly referring lo the substantive law of that country and not lo its connict of laws rules; (iii) failit1g any designation of the law under sub-clause (ii) by the parties, the arbitral tribunal shall apply the rules of law it considers to be npprnpdate give11 all the circumstances surrounding :lie dispute. (2) The arbitral tribunal shall decide ex aeqcw et bona or as amiable r.omposireur only if the parties have cxprcsgly authorbed it lo do so. (3) In 1Jll cases, the arbitml tribunal shall decide in accordance with the terms of the contract and shall take into account the usages of the trade applicable to the transaction. 29. (1) Unless otherwise agrce<l by the parties, in arbitral proceedings with more than one arbitrator, any decision of the arbitral tribunal shall be made by a majority of all its members. (2) Notwithslandu1g sub-section (]), if authorised by the parties or all the member.;; the arbitral tribunal, questions of procedure may be decided by the presiding arbitrator. 30. (1) It is not incompatible with an arbitration agreement for an arbitral tribunal to encourage settlement of the dispute and, with the agreement of the parties, the arbitral tribunal may use mediation, concilialion or other procedures at ~u1y time during the arbitral proceedings to encourage selilemenl. (2) If, during arbitral proceedings, the parties settle the dispute, the arbitral tribunal shall tcnni11ate the proccc<lings and, if requested by the f!artics and nol objected to by lhe arbilral tribunal, record the sclllemenl in the form of an arbitral award on agreed tenns. (3) An arbitral awar<l on agreed tcnns shall be made in accordance with section 31 and shall state that it is ai1 arbitral award. (4) An arbitral award on agreed lcnns shall have the same slatus and effect as any other arbitr_al award on the substance of the dispute. 13 THE CJ\ZETrE OF INDI.:'\ EXTRAORDINAf<.Y src 11 -·--·-=-===================== ~==---- ( }) An arbilral award shall be made 111 writing and shall be signed by thL: 31. • 1 ·1 1 I .. 1f the arh1tra tn mna . metn JL:rs l F the purposes of sub-section (1 ), in arbitrul proceedings with more th:m one (_2l_ or the signatures or the majority of all the members of the arhitral tribunal shall arbitrator, , 1• · ., • · d 1.1 •. •1 .111 so loll" as the reason or any omlllcu s1gnaltire b state . be su 1c c • "' (3) The: arhitral award skill st:itc the reasons upon which it is based, unk:ss- (a) the parties have agreed that no reasons arc ,to be given, or (/J) the award is an arhitral award on agreed tenns under section 30. (4) The arbitral awurd shall stale its date and the place of arbitration as dc!ennined in accordance with se.ction 20 and the award shall be deemed to have been made :1t that pluec.:. (5) After the arbitrnl a.ward is made, a signed copy shall be deliven:d to each party. (6) The arbitral tribunul may, at any time during the arbitral proceedings, make a.11 interim arbitral award on any mailer with resped to which it may make a final arbitral award. (7) (a) Unless otherwise agreed by the parties, where and in so far as an arbitral award is for the payment of money, the arbitral tribunal may include in the sum for which the award is made interest, at such rate as it deems reasonable, on thc whok or any part of th1: money, for the whole or any pat·! of the period between the date on which the catL'iC of adion arose and the date on which the award is made. (b) A sum directed to be paid hy an arbitral award shall, unless the award otherwise directs, carry interest at the rate of eighteen per centwn per annum from the date of the award to the date of payment. (8) Unkss otherwise agreed by the parties,- (a) the costs of an arbitration shall be fixed by the arbitral tribunal; (b) the arbitral tribunal shall spccify- (i) the party entitled to costs, (ii) the party who shall pay the costs, (iii) the amount of costs or method of determining that amount, and (iv) the maimer in which the costs shall be paid . • • • Exp/anation.-For the purpose of clause (a), "costs" :ncans reaslnable costs relating to- (i) the fees and expenses of the arbitrators and witnesses, (ii) legal l'ccs a11J expenses, (iii) any ad1n·1111· ·t 1· f • J • • • • • I b' • d s ra 1011 l'CS of t 1e mstllullon superv1smg I 1e ar llralton, an Fonn and contents of arbitral award. Termination of procee­ dings. Correction and inter­ pretation of award; additional award. 14 THE GAZETTE OF INDIA EXTRAORDINARY [PART II- (iv) any other expenses incurred in connection with the arbitral pr,:oceedings and the arbitral award. 32. (J) The arbitral proceedings shall be terminated by the final arbitral award or by an order of the arbitral tribunal under sub-section (2). (2) The arhitral tribunal shall issue an order for the termination of the arbitral proceedings where- (a) the claimant withdraws his claim, Wlless the respondent objects to the order and the arhitral tribunal recognises a legitimate interest on his part in obtaining a final settlement of the dispute, (b) the parties agree on the termination of the proceedings, or (c) the arbitral tribunal finds that the continuation of the proceedings has for any other reason become ut1J1ecessary or impossible. (3) Subject to section 33 and sub-section ( 4) of section 34, the mandate of the arbitral tribW1al shall terminate with the termination of the arbitral proceedings. 33. (J) Within thirty days from the receipt of the arbitral award, unless another period of time has been agreed upon by the parties- (a) a party, with notice to the other party, may request the arbitral tribunal to correct any computation errors, any clerical or typographical errors or any other errors of a similar nature occurring in the award; (b) if so agreed by the parties, a party, with notice to the other party, may request the arhitral tribunal to give an interpretation of a specific point or part of the award. : r , : •. . ~ " • '.,.:," (2) If the arbitral t,ribW1al considers the request made under sub-section (J) to be justified, it shall make the correction or give the interpretation within thirty days from the receipt of the request and the interpretation shall fonn part of the arbitral award. (3) The arbitral tribunal may correct any error of the type referred to in clause (a) of sub-section (J), on its own initiative, within thirty days from the date of the arbitral award. (4) Unless othetwise agreed by the parties, a party with notice to the other party, may request, within thirty days from the receipt of the arbitral award. the arbitral tribtmal to make an additional arbitral award as to claims presented in the ~itral proceedings but omitted from the arbitral award. (5) If the arbitral tribunal considers the request made under sub-section ( 4) to be justified, it shall make the additional arbitral award within sixty days from the receipt of such request. (6) The arbitral tribunal may extend, if necessary, the pefiod of time within which it shall make a correction, give an interpretation or make an additional arbitral award under sub-section (2) or sub-section (5). (7) Section 31 shall apply to a correction or interpretation of the arbitral award or to an additional arbitral award made under this section. THE GAZETTE OF INDIA EXTRAORDINARY 15 ~=====================---== ===== CHAPTER Vll Recourse against arbitral award . R . rse to a Court ag~inst an arbitral award may be made only • by an 34 ( /) ecou d • dan • • h b • d . • . i selling aside such a war rn accor ce wit su -secllon (2) an sub- apphcatton or section (J). (2) An arbitral award may be set aside by the Court only if- (a) the party making the application furnishes proof that­ (i) a party was under some incapacity, or (ii) the arbitration a?~cment i_s ~ot ~alid under the law to which the par_ties have subjected it or, fathng any md1ca11011 thereon, under the law · for tl1e tune being in force; or (iii) 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; or -...·., (iv) the arbitral award deals with a dispute not contemplated by or not falling within the tenns of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration: Provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, only that part of the arbitral _3:~:µ-d whi~h contains decisions on matters not submitted to arbitration may be set aside; or, (v) the composition of the arbitral tribunal or the arbitral procedure was not in. accordance with the agreement of the parties, unless such agreement was in conflict with a provision of this Part from which the parties cannot derogate, or, failing such agreement, was not in accordance with this Part; or (b) the Court fmds that- (1) the suhjcd-matter of the dispute is not capable of settlement by arbitration under the law for the time being in force, or _ . _ . (ii) the arbitral award is in conflict with the public policy of India. prejudice to the generality of sub-clause (ii) of clause (b), it declared, for the avoidance of any doubt, that an award is in conflict with the of India if the making of the award was induced or affected by fraud or or was in violation of section 75 or section 81. An application for setting aside may not be made after three tnonths have elapsed th-: ~ate on which the party making that application had received the arbitral or, tf a request had been made under section 33, from the date on which that had Qcen disposed of by the arbitral tribunal: 1 that (f the Court is satisfied that the applicant was prevented by sufficient from making the application wfthin the said period of three months it may !he application \\'.ithin a further period of thirty <lays, but not thcrcaftcr. receipt of an application under sub-section (J), the Court may, ,vhcre it is • Application for setting aside arbitral award. Finality of arhitr,il awards. Enforce­ ment. Appealable orders. Deposits. THE GAZETfE OF !NOIA EXTRAORDINARY appruprialc al\J it is so rcq11cstcJ by a party, adjDum the proccedings for a period of timc dctcrmincd by it in order to givt.: the arbitral tribunal au opportunity to resume thc arbitral pnicccdings or to t:ih· such other action as in the opinion of arbitral tribunal will eliminate the grounds for setting aside !ht: arbitnl award. CJ/APTER VJJJ Finulitr and e11force111e11t of arbitral awurds 35. Subject to this Part an arbitral award shall be, final and binding on the pi1rtks a.lid persons claiming under them respectively. 36. Where tht: time for making an application lo set a.side the arbitral award under section 34 has expired, or such application having been made, it has been refused, the award .shall be enforced under the Coe of Civil Proccdurt:, 1908 in the same maimer as 5 if it were a decree of the Court. CHAPTER IX Appeals 37. (]) An appeal shall lie from the following orders (and from no others) to the Court authorised by law to hear appeals from origiJ1al decrees of the Court passing the order, namely:- (a) granting or rcftL'>ing lo grant any measure under section 9; (b) setting aside or refll5ing to set aside an arbitral award under section 34. (2) A11 appeal shall also lie from an order granting or refusing to grant an interim measure under section 17 to a Court. (3) No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall affect or take away any right to appeal to the Supn:mc Court. CHAPTER X Miscef faneous 38. (J) TI1e arbitral tribunal may fix the amount of the deposit or supplementary deposit, as the case may be, as an advance for the costs referred to in sub-se{;tion (8) of section 31, which it expects will be incurred in respect of the claim submitted to it: Provided that where, apart from the claim, a counter-claim has been submitted to the arbitral tribunal, it may fix separate amount of deposit for the claim and cotmler-claim. (2) The deposit referred to in sub-section (1) shall be payable in equal shares by the parties: I Provided that where one party fails to pay his sh:ire of the deposit, the other party may pay that share: Provided further that where the other party also docs not pay the aforesaid share in rt:spcct of the claim or the counter-claim, the arbitral tribunal may suspend or tcnuinate the arbitral proceedings in respect of such claim or counter-claim, as the case m:iy he. 17 THE GAZETTE OF INDIA EXTRAORDINARY si;c.1 l -----==~~~~= =============c:= ==t= ~ ination of the arbitral proceedings, the arbitral tribunal shall render an (3) U_ron ttentln . parties of the: deposiL-, received and shall retum any unexpended I Ilg O JC _, acconn 1 h. artv or parties, as the case may be. balance to t c p ; S b. ·t to the prov1s1ons of sub-section (2) and to any prov1s1011 to lhe 39. (1): 11 (hei arbitration agreement, the arbitral tribunal shall have a lien on the ontrary m • f th b" • c . d for anv unpaid costs o e ar 1tratton. arb1tral awar ' f . y case an arbitral tribunal refuses to deliver its award except on payment (2) 1 1~ ~ema.nded by it, the Court may, on an application in this behalf, order that of theb~os .ls tribunal shall deliver the arbitral award to the applicant on payment into the ar itra d d d d h II f h • • "f b the applicant of the costs eman e , an s a , a ter sue 1nquuy, 1 any, as ~o~~t iJ fit further order that out of the money so paid into Court there shall be paid It t, m b"itra' l tribunal by way of costs such swn as the Court may consider reasonable to tne ar ' . h · and that the balance of th,: money, If any, shall be refunded to t e applicant. (3) An application under sub-s~tion (2) may be made by any party u~less tl~e fees demanded have been fixed by written aweement between hnn and the arb1tral tribunal, and _ the arbitral tribunal shall be enlltled to appear and be heard on any such application. (4) The Court may make_ such _orders as i~ thinks fit respecting the C?5ls of lhe arbitration where any quesl!on anses respectrng such costs and the arb1tral award contains no sufficient provision concerning them. 40. (1) An arbitration agreement shall not be discharged by lhe death of any party thereto either as respects the deceased or as respects any other party, but shall in such event be enforceable by or against lhe legal representative of the deceased. (2) The mandate of an arbitrator shall not be lem1inated by the death of any party by whom he was appointed. (3) Nothing in this section shall affect the operation of any law by virtue of which at1y right of action is extinguished by the death of a person. ! f , Al. (I) Where it is provided by a tertn in a contract to which an insolvent is a party ,.t!iat any dispLlle arising thereout or in connection therewith shall be submitted to f t5}1b~tratio1_1, the said term shall, if the receiver adopts the contract, be enforceable by or {)fflgamst hun so far as it rela(es to any such dispute. ~!'\:' \,: {2) Where a person who has been adjudged an insolvent had, before the ,;;:H;l:?1runencement of the insolvency proceedings, become a party to an arbitration f;\ Wgr~ment,_ and any matter to which the agreement applies is required to be determined ,iJ+r~ connection with, or for the purposes of, the insolvency proceedings, then, if the case f.'?i;'~ one 10 wh!ch sub-section (J) does not apply, any other party or the receiver may !J~}~!)siy 1? th? Judicial authority having jurisdiction in the insolvency proceedings for an :y:,_;()t. ~r d1tcct11~g that the matter in question shall be submitted to arbitration in accordance t}{)t 1. the arb!lration agreement, and the judicial authority may, if it is of opinion that, ·f \:': b"lllg regard lo all rhe circumstances of the case the matter ought to be deltrrnined by t'\~1 1z, :lration, make an order accordingly. ' {·,~l< · i· , '' \~~) In this section the expn.-ssion "ret:eiver'' il,cludes au Official Assignee. "' Notwithstai1d· h. • • ls J • tI • p • th I • f . . . . mg any! mg comamcct e 'CW 1cre tn us art or m any o er aw !or unc bc111g ill ,. 1 • h • b" • 1· • } this p ,orce, w 1cre :wit respect to an ar 1tra1ton agreement_ ru~y ?PP 1cat10n •.•. art has been made Ill a Court, that Court alone shall have Jtmsd1_d10n over Lien on arbitral award arid deposits as to costs. Arbitration agreement not to be discharged by death of party thereto. Provisions in case of insolvency. Jurisdic­ tion. 18 THE GAZE1TE OF TNDT A EXTRAORDINARY [PART II--- the arbitral proceedings and all subsequent applications arising out of that agreement and the arhitral proceedings sh.all be made in that Court and in no other Court. Limitations. 43. (I) The Limitation Act, 1963, shall apply to arbitrations as it applies to Definition. Power of judicial authority to rcfor parties to :u-bitration. When foreign a.ward binding. proceedings in court. (2) For the purposes of this section and !he Limitation Act, 1963, an arbitration shall be deemed to have commenced on the date referred in section 21. (3) Where an arbitration agreement to submit future disputes to arbitration provides that any claim to which the agreement applies shall be barred unless some step to commence atbitral proceedings is taken within a time fixed by the agreement, and a -,dispute arises to which the agreement applies, the Court, if it is of opinion that in the circumstances of the case undue hardship would otherwise be caused, and notwithstanding that the time so fixed has expired, may on such tenns, if any, as the justice of the case may require, extend the time for such period as it thinks proper. ( 4) Where the Court orders that an arbitral award be set aside, the period between the commencement of the arbitration and the date of the order of the Court shall be exclued in computing the time prescribed by the Limitation Act, I 963, for the commericement of the proceedings (including arbitration) w1th respect to the dispute so submitted. PART II ENFORCEMENT OF CERTAlN FOREIGN AWARDS CHAPTER I New York Convention Awards 44. In this Chapter, w1lcss the context otherwise requires, "foreign award'.' means an arbitral award on differences between ~rsons arising out of legal relationships, whether contractual or not, considered as commercia1 under the law in force in India, made on or after the 11th day of October, 1960- (a) in pursuance of an agreement in writing for arbitration to which the Convention set forth in the First Schedule applies, and (b) in one of such territories as the Central Government, being satisfied that reciprocal provisions have been made may, by notification in the Official Gazette, declare to be territories lo which the said Convention applies. 45. Notwithstanding anything contained in Part I or in the Code of Civil Procedure, 1908, a judicial authority, when seized of an action in a matter in respect of which the parties have made an agreement referred to in section 44, shall, al the request of one of the parties or any person claiming through or un<ler him, refer the parties to arbitration, • unless it finds that the said agreement is null and void, inoperative or incapable of being perfonned. ' 46. Any foreign award which would be enforceable under this Chapter shall be treated as binding for all purposes on the persons as between whom it was made, and may accordingly be relied on by any of those persons by way of defence, set off or otherwise in any legal proceedings in India and any references in this Chapter to ,enforcing a foreign award shall be construed as including references to relying on an award. ~GA?,ETTE OF INDIA EXTRAORDINARY 19 fh arty applying for the enforcement of a foreign award shall, al the time Evidence. ,. 47. (l)' 1. e iion produce before the court- of the app ,ca ' th original award or a copy thereof, duly authenticated in the manner required (a) e • h. h • <l h I w of the country Ill w 1c 11 was ma e; by t e a (b) the original agreement for arbitration or a duly certified copy thereof; and (c) such evidence as may be necessary to pro~r. that the award is a foreign award. (2) If the award or agreement to be produced under sub-section (J) is in a foreign 1 the party seeking to enforce the award shall produce a translation into English anguagc. . . th h. h h certified 0,, correct by a dtplmn~tlc or conhs ular agent of e cobeuntryffito_ w 1c t adt. party b 1 ·" certified as correct Ill such ot er manner as may su 1c1ent accor mg to e ongs , ,,, . the law ih iorce in India. Explariution.-In thi~ _section and al_l ~e f?ll?w~~ s~tions ?f t_his Cha~ter, "Court" means the principal_ Civil . Court. of ong~~l Jur!s?l~tl~n ~. a d1Stn~t, 3:11d_ m_cl~des the High Court in exercise of its ordmary or1gmal c1v1l Jurisd1ct100, havmg Jur1Sd1clio11 over the subject-matter of the award if the same had been the subject-matter of a suit, but does not include any civil court of a grade inferior to such principal Civil Court, or any Court of Small Causes. 48. (J) Enforcement of a foreign award may be refused, at the request of the party against whom it is invoked, only if that party furnishes to the Court proof that- (a) the parties to the agreement referred to ih seetion 44 • were, under the law applicable to them, under some incapacity, or the said agreement is not valid under the law to which the parties have subjeeted it or, failing any indication thereon, under the law of the country where the award was made; or (b) the party against whom the award is invoked was not given proper notice of the appointment of the arbitrator or of the arbitral proceedings or was otherwise unable to present his case; or (c) the award deals with a difference not contemplated by or not falling within the tenns of the suhmission to arbitration, or it contains decisions on matters beyond the scope . of the suhmission to arbitration: Provided that, if the deeisions on matters submitted to arbitration can be separated from those not so submitted, that part of the award which contains decisions ou matters submitted to arbitration may be enforced; or (d) the composition of the arbitral authority or the arbitral procedure was not in ac_cordance with the agreement of the parties, or, failing such agreement, was not in accordance with the law of the country where the arbitration took place; or (e) the award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or npder the law of which, that award was made. • · (2) Enforcement of an arhitral award may also be refused if the Court finds that­ (a) the subject-matter of the difference is not capable of settlement by arbitration uuder the law of lntlia; or (b) the enforcement of the award would be contrary to the public policy of India. Conditions for enforcement of foreign awards. Enforcement of foreign awards. Appealablc orders. Saving. Chapter II not to apply. Interpre­ tation. 20 THE GAZETTE OF INDIA EXTRAORDINARY Expla,wrion.-Wilhout prejudice to the generality of clause (b) of this sub-section, it is hereby declared, for the avoidance of any doubt, that an award is in connict with the public policy of India if the making of the award was induced or afkctcd by fraud or corruption. (3) If an application for the selling aside or suspension of the award has been made to a competent authority referred to in clause (e) of sub-section (J) the Court may, ir it considers it proper, adjourn the decision on the enforcement of the award and may also, on the application of the party claiming enforcement of the award, order the other party to give suitable security. 49. Where the Court is satisfied that the foreign award is enforceable under this Chapter, the award shall be deemed to be a decree of that Court. SO. (1) An appeal shall lie from the order refusing to­ (a) refer the parties to arbitratioJ?- under section 45; (b) enforce a foreign award under section 48, to the court authorised by law to hea/appeals from such order. (2) No second appeal shall lie from an order passed in appeal under this section, but nothing in this section shall affect or take away any right to appeal to the Supreme Court. 51. Nothing in this Chapter shall prejudice any rights which any person would have had of enforcing in India of any award or of availing himself in India of any award if this Chapter had not been enacted. 52. Chapter II of thls Part shall not apply in relation to foreign awards to which this Chapter applies. CHAPTER II Geneva Corrvention Av,,ards 53. In this Chapter "foreign award" means an arbitral award on differences relating to matters considered as commercial under the law in force in India made after the 28th day of July, 1924,- (a) in pursuance of an agreement for arbitration to which the Protocol set forth in the Second Schedule applies, and (b) between persons of whom one is subject to the jurisdiction of some one of such Powers as the Central Govenunent, being satisfied that reciprocal provisions have been made, may, by notification in the Official Gazette, declare to be parties to the Convention set forth in the Third Schedule, and of /'hom the other is subject to the jurisdiction of some other of the Powers aforesaid, and (c) in oue of such territories as the Central Govenunent, being satisfied that reciprocal provisions have been made, may, by like notification, declare to be territories to which the said Convention applies, and for the purposes of this Chapter an award shall not be deemed to be fmal if any proceedings for the purpose of contesting the validity of the award are pending in the 1908. s,c. l ] THE GAZElTE OF INDIA EXTRAORDINARY 21 country in which it was made. 54. Notwilhslanding anything contained in !',,;-, l nr i the Code of Civil Procedure, 1908, a judicial authority, on being seized of a dispt 'e regarding a contract made between persons to whom section 53 applies and inclus:ing an arbitration agrccmcnl, whc::thcr referring to present or future differences, which is valid under that section and capable of being carried into effect, shall refer the parti~ on the application of either of them or any person claiming through or under him to the decision of the arbitrators and such reference shall not prejudice the competence of the judicial authority in case the agreement or the arbitration caIU1ol proceed or becomes inopera"tive. 55. Any foreign award which would be 1:nforceable under this Chapter shall be lreatcc.1 as binding for all purposes on the persons as between whom it was made, and may accordingly be relied on by any of those persons by way of defence, set off or otherwise in any legal proceedings in India and any references in this Chapter to enforcing a foreign award shall be construed as including references to relying on an award. 56. (/)The party applying for the enforcement of a foreign award shall, al the time of application produce before the Court- (a) the original award or a copy thereof duly authenticated in the manner required by the law of the country in which it was made; (b)cvidence proving that the award has become final; and (c) such evidence as may be necessary to prove that the conditions mentioned in clauses (a) and (c ) of sub-section (J) of section 57 are satisfied. (2) Where any document requiring to be produced under sub-section (1) is in a foreign language, the party seeking to enforce the award shall produce a translation into .-. English ccrtitied as correct by a diplomatic or consular agent of the country io which \ that party belongs or certified as correct in such other manner as may be sufficient according to lhe law in force in llJdia. Explunation.-ln this section and all the following .sections of this Chapter, "Court" cans the principal Civil Court of original jurisdiction in a district, and includes the i~h Court in exercise of its ordinary original civil jurisdiction, having jurisdiction over !! subject-matter of the award if the samt: had bt:en the subject-matter of a suit, but , not include any civil court of a grade inferior lo such principal Civil Court, or any .1 of Small Causes. (I) In order that a foreign award may he enforceable under this Chapter, ii shall .essary that - 11~ the award has been made in pursuance of a submission to arbitration which }d under the law applicable thereto; he suhjecl-tnalter of the aware.I is capable of settlement by arbitfation under f India; c award has been made by the arbitral tribunal provic.lcc.I for in the ,10 ar~>itration or constituted in the manner agreed upon by the parties :md 11Ytllh the law governing the arbitration procedure; • a~d h:c; become final in the country in which it has been made, in the W.Jll not Ix: considered as such if it is open lo opposition or appeal or Power of judicial authority to refer parties to arbitration. Foreign awards when binding. Evidence. Conditions for enforcement of foreign awards. Enforcement "of foreign awards. Appealable orders. Saving. 22 THE GAZETTE OF INDIA EXTRAORDINARY [PART II - if it is proved that any proceedings for the purpose of contesting the validity of the award are pending; ' (e) the enforcement of the award is not contrary to the public policy or the law of India. EJ.planat~on.-Without prejudice to the gener~li~ of cla~ (~), it is here~y declar~ for the avoidance of any doubt, that an award lS m conflict with the public policy of India if the making of the award was induced or affected by fraud or corruption. (2) Even if the conditions laid down in sub-section (I) are fulfilled, enforcement of the award shall be refused if the Court is satisfied that- (a) the award has been annulled in the country in which it was made; (b) the party against whom it is sought to use the award was not given notice of the arbitration proceedings in suffo;ient time to enable him to present his case; or that, being under a legal incapacity, he was not properly represented; (c) the award does not deal with the differences contemplated by or falling within the temis of the submission to arbitration or that it contains decisions on matters beyond the scope of the submission to arbitration: Provided that if tqe award has not covered all the differences submitted to the arbitral tribunal, the Court may, if it thinks fit, postp.:me such enforcement or grant it subject to such guarantee as the Court may decide. (3) If the party against whom the award' has been made proves that under the law governing the arbitration procedure there is a ground, other than the grounds referred to in clauses (a) and (c) of sub-section (1) and clauses (b) and (c) of sub-section (2) entitling him to contest the validity of the award, the Court may, if it thinks fit, either refuse enforcement of the award or adjourn the consideration thereof, siving such party a reasonable time within which to have the award annulled by the competent ·tribunal. 58. Where the Court is satisfied that the foreign award is enforceable under this Chapter, the award shall be deemed to be a decree of the Court. 59. (J)An appeal shall lie from the order refusing- (a) to refer the parties to arbitration under section 54; and (b) to enforce a foreign award under section 57, to the court authorised by law to near appeals frotn such order. (2) No second appeal shall lie from an order passed V1 appeal under this section, but nothing in this section shall affect or take away auy right to appeal to the Supreme Court. 60. Nothiug in this Chapter shall prejudice any rights which any person would hav_e had of enforcing in India of any award or of availing himself in India of any award if this Chapter had not been enacted. cfj~::::::=~T~H::::E::::::G=A==Z==E=TI=E=O=F=I=ND=IA=E==X=T=RA=O=RD=JN=A=R=Y======23 PART ill CONCILIATION · 1 Save as otherwise provid~ by any law for the time .h:ir_ig in fo~ce ru1d u~~s < • -61• ( _) have otherwise agreed, this Part shall apply to conc1ltat1on of d!Sputes ansmg the parftiles I relationship, whether contractual or not and to all proceedings relating out o ega thereto. (2) This Part shall not apply w~ere by virtu~. o~ any law for the time being in force · d'isputes may not be submitted to concihatton. certam 62. (]) The party initiating . conciliati?n sh.all ~en? to the ~ther party ~ written invitation to conciliate under this Part, bneOy 1dent1fymg the subject of the d1Spute. (2) Conciliation pr~_eedings shall commence when the other party accepts m writing the invitation to conc1hate. (3) If the other party rejects the invitation, there will be no conciliation proceedings. (4) If the party initiating conciliation does not receive a 'reply within thirty days from the date on which he sends the invitation, or within such other period of ,time as specified in th~ invitation, he may elec~ to tre~t t~ _as a rejection of the· invit:ition to conciliate and 1f he so elects, he shall inform m wntmg the other party accordrngly. Application and scope. Commen~e­ ment of conciliation proceedings. 63. (1) There shall be one conciliator unless the parties agree that there shall be. two Number of or three conciliators. conciliators. (2) Where there is more than one conciliator, they ought, as a general rule, to act jointly. 64. (1) Subject to sub-section (2),- Appoint- ment of (a) in conciliation proceedings with one conciliator, the parties may agree on the conciliators. name of a sole conciliator; (b) in conciliation proceedings with two conciliators, each party may appoint one conciliator; (c) in conciliation proceedings with three conciliators, each party may appoint one conciliator and the parties may agree on the natne of the third conciliator who shall act as the presiding conciliator. . (2) Parties may enlist the assistance of a suitable institution or person in. connection With the appointment of conciliators, and in particular,- . (a) a party may request such an institution or person to re{!ommend the names of Sl!llable individuals to act as conciliator; or I (b) the parties may agree that the appointment of one or more concilfotors be made directly by such an institution or person: . ~rovidcd that in recommending or a~pointing individuals to act ,a.s conciliator, the 111st ll~ition or person shall ha~e regard to such considerations a.s are likely to secure the • :i~~U~lln~!1~ of an indcpcn~cnt ru1d ~npartial c~ncil_i~tor and, w_ith_ respect t~ _a sole or . conciliator, shall take mto account-the adv1sab1hty of appollltlllg a conc1hator of a nationality other than the nationalities of the parties. Submission of state­ ments to conciliator. Conciliator not bound by certain enactments. Role of conciliator. Adminis­ trative a.-;sistance. Cotnmuni­ cation between conciliator and parties. Disclosure of infor­ mation. 24 THE GAZETfE OF INDIA EXTRAORDINARY [PART II-- 65. (1) The conciliator, upon his appointment, may request each party to suhmit to him a brief written statement describing the general nature of the dispute and the points at issue. Eacfi pai-ty shall send a copy of such statement to the other party. (2) The conciliator may request each party to submit to him a fnrt11er written statement of his position a11d the facts and grounds in support thereof, supplemented by any documents and other evidence that such party deems appropriate. TI1c party sh::ill send a copy of such statement, documents and other evidence to the other party. (3) At any stage of the conciliation proceedings, the conciliator may request a party to· submit to him such additional infonnation as he deems appropriate. E;.planation.-In this section and all the following sections of this Part, the tenn "conciliator" applies to a sole conciliator, two or three conciliators as the case may be. 66. 111e conciliator is not bound by the Code of Civil Procedure, 1908 or the Indian Evidence Act, 1872. 67. (I) 111c conciliator shall assist the parties in an independent and impartial maru1er in their attempt to reach an amicable settlement of their dispute. (2) 1l1e conciliator shall be guided by principles of objectivity, fairness and justice, giving consideration to, among other things, the rights and obligations of Ute parties, the usages of tlic trade concerned and lhe circumstances surrounding the dispute, including any previous business practices between the parties. (3) The conciliator may conduct the conciliation proceedings in such a manner as he considers appropriate, taking into account the circumstances of the case, the .wishes the parties may express, including any request by a party that the conciliator hear oral statements, and the need for a speedy settlement of the dispute. ( 4) The conciliator may, at any stage of tlte conciliation proceedings, make proposals for a settlement of the dispute. Such proposals need not be in writing and need not be accompanied by a statement of the reasons therefor. 68. In order to facilitate the conduct of the conciliation proceedings, the parties, or the conciliator with the consent of the parties, may arrange for administrative assistance by a suitable institution or person. 69. (1) TI1e conciliator may invite the parties to meet him or may communicate with them orally or in writing. He may meet or c01mnunicate with the parties together or with each of them separately. (2) Unless the parties have agreed upon the place where meetings with tlie conciliator are to be held, such place shall be dctennined by the conciliator, after consultation with the parties, having regard to the circumstances of the concili,.tion proceedings. 70. When the conciliator receives factual infonnation concerning the dispute from a party, he shall disclose the substance of that infonnation to the other party in order that the other party may have the opportunity to present any explanation which he considers appropriate: Provided that when a party gives any infonnation to the conciliator subject to a specific condition that it be kept confidential, the conciliator shall not disclose that s l THE GAZ,ETfE OF INDIA EXTRAORDiNARY 25 . . tion to the other p:1rty. 1nfo1111a -ri 11.r1·11-s slnlJ in i'Ood faith co-operate with the conciliator and, in particular, 71. I JC ,I • ' ' "' . I 1 .. vour to comply wllh reqm:sts by the conciliator to submit wriltcn materials, shal fll( '-'1 • ..•. ··vidcncc and all end mcct1ngs. prov1uc ~ 72_ E:idi party may, on his ?wn initiative or at the invita~ion of the conciii:itor, h -1 1 tJ,c conciliator su\:gcst1011s fur the settkmrnt of the dispute. SU 1111 o • ' Co-opera­ tion of parties with conciliator. Suggestiot1!3 by parties for scttlc­ mc111 of dispute. 73. ( 1) When it appears to the conciliator that there exist elemenL-, of a s1:1tlcment Settlement which m~y he acceptable to the parties, he shall fonnulate the tenns of a possible agreement. scttlcim:nl and submit them to the parties for their obserY-ations. After reccivin_g tht: ~hscrvations of the partks, the conciliator may rcfonnulate the terms of a possibk settknwnl in the light of such oh~ervations. (2) If th1~ parties reach agn:cment on a selllcmcnt of the dispute, they may draw up and sign a written seillcmcnt agreement. If requested by the parties, the conciliator may draw up, or assist the parties in drawing up, the settlement agreement. (3) When the parties sign the settlement agreement, it shall be final and binding on !he parties and persons claiming under them respectively. (4) 11H: conciliator shall authenticate the settlemi::nt agri::ement and fumbh a copy thereof to each of the parties. 74. The settlement agret:mcnt shall have the same status and effect as if it is an arbitral award on agreC<.i tcnm; on the substance of the dispute rendered by an arbitral tribunal under section 30. Notwithstanding anything contained in any other law for the time being in force, conciliator and the pariics shall keep confidential all matters relating to the procei::dings. Contidcntiality shall extend also to the selllemeot agrt:emenl, where its disclosure is necessary for purposes of impkmi::ntation and C1Jlo,rccn1ent. (a) by the signing of the settlement agreement by the parties, on the date oi the or (h) b!' a written declaration of the conciliator, after consultation with the r,;inies, thc clfcet that further dforts al conciliation are no longer justified, on the d.:i1i:: of declaration; or 1 (c) by a written declaration of the parties addressed to the conciliator to tht: effect thc conciliation proceedings arc tcnninatcd, on the date of thl". declaration: ur 1 (c~ by a ,vrittcn dccbration of a party to the other party an<l the conciliaLQr, if ,pomtc<l lo tl1e ·1·• • t th I ·1· • <l' • d ' d ,·•h.• • ' , c 1cc at t 1e co11c1 1at1on procce 111gs arc tennmatc , on t.ht: ate 1 c declaration. Status and effect of settlement agreement. Confiden­ tiality. Termination of conci­ liation proceedings. Resort to arbitral or judicial proceedings. Costs. Deposits. Role of conciliator in other proceedings. Admissi­ bility of evidence in other proceedings. 26 THE GAZETTE OF INDIA EXTRAORDINARY 77. 111c parties shall no! initiate, during the conciliation proceedings, :my arbitraJ or judicial proct:c<lings in respect of a dispute that is tht: subjt:ct 'matter of the cc,uciliation procecdings,exccpt that a party tnay initiate arbitral or judicial procCl:dings whnc, in his opinion, such proceedings :m: necessary for prcs..:rving his rights. 78. (1) Upon t..:rminaiion of the conciliation proceedings, the concilbtor shall fix U1c costs of the conciliation and give written notice thereof to the parties. (2) For the purpose of sub-section (1), "costs" me.;,1s rca:sonabk costs" relating to-­ (a) the foe and expenses of the condliator and witnesses request<:d by Uic conciliator with the consent of the parties; (b) any expert advice rcq111:stcd by the conciliator with the consent of the p::irtil'.s; (c) any assistance provided pursuant to clause (b) of sub-section (2), of section 64 and section 68; (d) any other expenses incurred in cotmcction with the conciliation prcx:i:eJings and the settlement agreement. (3) The costs shall be borne equally by the partit:s unless the settlement agreement provides for a different apportionment. All other expenses incurred by a party shall be bome by that party. 79. (1) The conciliator may direct each party to deposit an equal amount as an advance for the cos!s refe1red to in sub-section (2) of section 78 which he expects will be incurre<l. (2) During the course of the conciliation proceeJings, the conciliator may direct supplementary deposits in an equal amount from each party. (3) If the required deposits under sub-sections (1) and (2) are not paid in full by both parties within thirty da1s, the conciliator may suspend the proceedings or may make a written declaration of termination of the proceedings to the parties, effective on the date of that declaration. (4) Upon tennination of the conciliation proceedings, the conciliator shall renJer an accounting to the parties of the deposits received and shall return any unt>xpended balance to the parties. 80. Unless otherwise agreed by the parties,- (a) the conciliator shall not act as an arbitrator or as a representative or counsel of a party in any arhitral or judicial proceeding in respect of a dispute that is the subject of the conciliation proceedings; (b) the conciliator shall not be presented by the parties as a witness in any arbitrnl • 1· • I ' .,· 1 or JU< tcta procecumgs. 81. The parties shall not rely on or intro<luce as evidence in arbitral or judicial proceedings, whdher or not such procet:dings rclntc to the dispute that is the subj•:ci of the conciliation proeeedings,- • (a) views expressed or suggestions made by the other party m respect of a possible settlement of the dispute; s,;c :. i I ~- THE GAZETTE OF INDIA EXTRJ\ORD!NARY 27 (b) admissio11s made by the o\her p'.lTly in the course of the conciliation proceedings; (c) proposals made by lhc conciliator; ( 1, ti c f-tcl thal the other party had indicated his willingness to accepl a proposal ( ,) 1 ' . . l 'I .111 ,. 11 1 made by the conc11lator. [or SC I. C • PART IV SUPPLEMENTARY PROVISIONS 82. The High Court may make ;l1lcs ~onsish:nl with this Ordinance as to all .. ·diw•s before the Court under this Ordmance. proccc o· 83. (/) If any difficulty arise.'> in giving effect lo the provisions of this Ordinance, the Central Govcmmcnl may, by order published i..t1 the Official Gazette, make such provisions, not inc~nsistent with ~he provi~ions of this or4inance as appear to it to be necessary or expedient for removrng the difficulty: Provided that no such order shall be made after the expiry of a period of two ye:u-s ' from the dal<: of commencement of this Ordinance. (2) Every order made under this section shall, as soon as may be after it is made, be laid before each House of Parliament. 84. (]) 1l1e Central Government may, by notification in the Official Gazette, make , rnJcs for carrying out the provisions of this Ordinance. ·(2) Every mle made by the Central Govcnuncnt under this Ordinance shall be laid, as soon as may be, after it is made bc:fore each House of Parliament while it is iu :_ session, for a total period of thirty days which may be comprised in one session or in • ' ' ) t\Vo or more successive sessions, and if. before the expiry of the session immediately .,,. . .'_ J<>Uowing the session or the successive scssi.:ins aforesaid, both Houses agree in making ;;;\{t f11Y modification in the rule or both Houses agree that the nile should not be made, the • ·Jf{l1lc shall thereafter have effect only in such modified fonn or be of no effect, as the 1/f~~~ n_iay be; so, however, that any such moditication or annulment shall be without _f ~}lldtcc to !he validity of at1ything previously done under that mle. \SS, (}) TI1c Arbitration (Protocol and Convention) Act, 1937, the Arbitr:ilion Act, .940 and the Foreign Awards (Recognition and Enforcement) Act, 1961 are hereby ep·ealcd. , {2)Notwithstanding such repeal,- • ' ~a~ .the prn_visions o f the said enactments shall apply in relation to arbit ,al .. Procccd1ngs which. d l 1· 1 · 0 d' • ,. 1~ 1 • •• :a.,. . . commence Jc nrc t 11s r 111ance came 11110 1orcc un i!ss ol wrw1se ; {:i~~~hd by Ilic parties but this Ordinance shall apply in relation to arbitral proceedings . • ... lc co1111ncnced f I • 0 1· • ,. • C· on or a tcr t 11s n mancc comes 111to 1orec; ;-·I:.\f·~h) all nilcs llladc and notifications published. tmdcr the said cnaclmcnts shall, to , ' xtcnt to wl11·t, J1 11 J • • O d" b d d • 1 •·h; icy arc not rcpugnant to t HS r mancc c ccmc rcspecttvc v , ... ,we been nia J . • , 1 • - . . ' ' •• '· .:, < c or 1ssucc under this Ordm:.1.11cc. Power of High Court to make n1lcs. Removal of difficulties. Power to make rules. Repeal and savings. Repeal of Ord. 8 of 1996. 28 THE GAZETTE OF [NDIA EXTRAORDINARY 86. (1) The Arbitration and Cont:iliat1on Ordinance, 1996 is h<.:reby rqx:ak<l. (2) Notwithstanding sucli r<.:p<.:al, any ord<.:r, rule, noti!icalion or scheme made or anything done or :my action taken in purM1ann: of :my provision of the said Ordinance shall be deemed lo hav<.: b,.:<.:n ma<l<.:, don<.: or iaken under the corresponding provisions of this 0rdi1wncc. THE GAZETTE OF lNDIA EXTRAORDINARY S r;c. l ] ----=-----=: - - ~ 29 THE FIRST SCHEDULE (See section 44) ~rrJON ON THE RECOONlllON AND ENFORCEMENT Of FOREIGN ARBITRAL AWARDS coNVE"• ARTICLE I 11i· Convention shall apply to the re<:ognition and enfor<:cmcnt of arbitral awards ~ , _ 15the territory of a State other than the State where the recognition and ma e 11n1 . 111 of such awards are sought, and arising out of differences between persons, forcct c en . h physical or legal. It shall also apply to arhitral awards not considered as whet er h h • • • d f I !"te awards in the State w ere I cir rccogn111on an en orcement are soug 11. domes 2 The tenn "arbitral awards" shall include no! only awards made by arbitrators app~intcd for eac~ case but also those made by pennanent arbitral bodies to which the parties have suhmllted. 3. When signing, ratifying or acceding to this Convention,' or notifying extension under e-rticle X hereof, any State may on ihe basis of reciprocity declare that it will apply the Convention to the recognition and enforcement of awards made only in the territory of another Contracting State. It may also declare that it will apply the Convention only to differences arising out of legal relationships, whether contractual or not, which are considered as commercial under the national law of the State making such dcdararion. ARTICLE // 1. fuch Contracting State shall recognise an agreement in writing under which the parties undertake to submit to arbitration all or any differences which have arisen or • which may arise Let ween th<'.m in respect of defined legal relationship, whether contractual or not, concerning a subject-matter capable of settlement by arbitration. 2. The tenn "agreement in writing" shall include an arbitral clause in a contract or an arbitration agreement, signed by the parties or contained in an exchange of letters or t telegrams. • -- ... _ 3. !he court of a Contracting State, when seized of an action in a matter in respect •\pf which the parties have made an agreement. within the meaning of this article, shall, (\,f~ the.rcqucst of o~e of the parti?s, ~efer th~ partie~ to arbitration,. 1mless it finds that ' /:e said agreement 1s null and vc))d, moperat1ve or mcapable of bemg pcrfonned. ARTICLE lll : • Each Contracting State shall recognize arbitral awards as binding and enforce them _ln accordance with the mies of procedure of the territory where the award is relied ::~Pon, 11ndcr the conditions bid down in the following articles. There shall 1101 be :r;°sl:d. substantially more onerous conditions or higher fees or charge;, on the uJogntdtton or enforcement of arbitral awards to which this Convention applies than arc • --pose on the r.. 't' . • - - , .. cog111 1011 or enforcement of domestic arbllral awards. ARTICLE JV To obtain the t • ·1· 1 • d • h d. • I h 'a 1 . cc--ogm Ion ana c,nforccmcnt mcnttonc - m t c prcce mg arllc e, t e :_'fo~tytp ying for recognition and enforcement shall, at the time of the application, L<'t'<' 30 THE GAZETfE OF lNDfA EXTRAORDINARY (a) the d\l!y :rnthcnticah.:<l origin:1! award or a duly ccrtifi~l copy thereof; • (h) the .original agr<:cmcnt referred to in article II or a duly ccrtilicd copy thereof. 2. If the said award or :i,grccment is not made in 311 official bnguagc of the country in which thc award b rdicd upon, the parly applying for rcc:ognitio11 a11d cufotccrnent of the award shall produce a translation of these documents into such language. Tiw traJL'-;lation shall he certified by an oflkial or sworn translator or by a diplomatic or consular agent. ARTICLE V 1. Recognition and enforcement of the award may be refused, at the request of the party against whom it is invoked, only if that party fumishes to the competent authority where the rccognit-ion anJ l'nforeement is sought, proof that- (a) the partics to the agr<:cmcnl rcfc1rc<l to in article II were, under the lnw applicable to them, under some incapacity, or the said agreement is not valid under the law to whid1 the parties hnvc subjected it or, failing aJ1y indication thereon, under the law of the country where the award was made; or (b) the party against whom the award is invoked was not given proper notice of the appointment or the a.rbitrntor or of the arbitration proceedings or was othcnvise unable to present his case; or (c) the award deals with a difference not contemplated by or not falling within the tenns of the suhmissi<ln to arbitration, or it contni.ns decisions on matters kyond the scope of the submission to arhitralion, provided that, if the decisions on matters submitted to arbitration can be sepnrnted from those not so submitted, that part of the award which contains decisions on mailers submitted to arbitration may be recognL.,ed and enforced; or (d) the composition of the arbitral authority or the arbitra! procedure was not in accordance with the agreement of the parties, or, failing such agreement, was not in accordance with the \aw of the country where the arbitration took place; or (e) the awar<l has nol yet become binding on the parties, or has been set aside or suspended by a coinpctcnt authority of the country in which, or under the law of whkh, that award was rn:ide. 2. Recognition and competent authority in that- enforcement of an arbitral award may also be refusc<l if the the co11111ry where recognition and cnfon.:ement is sought find<; I (a) the subject-matter of the difference is nol capable of settlement by arhitralion under the law of that country; or (h) the rc<..:ognition or c11fon:c111c11t of the award would be contrary to the public policy of that co1111try. I ARTICLE VI If an opplication for the ~dting asi<lc or s11spe11:;io11 of the awar<l has been made to a competent authority r..:fcrred lo in :trticlc V(l )(c), the authority before which the award is spught to he relied upon may, if it considcts it proper, adjourn the decision on thi: cnfon.:cmc1it of the award and may also, on the application of the party claiming c11forcc111cnt o'f the award, order the other party to give s11ilahlc security. 31 ARTICLE VII 1 .0 .. 1·..c·1011s of the •1m·scnl Convention shall not affect the validitv of 1 1 JC pr V ., , •. . , 1 or bila!cral agreement:; concerning the recognition and enforcement of mul11l:1tcr,1 I ~ • "' d • • <l . 1 , l·· cnlercd into by t 1c Co111ract111g .:-talcs nor eprivc any mlcrcstc party b1tra aw.tr< -~ ar_ ·,,' 1 he may have to avail hirnsdf of a.11 arbitral aw;1r<l in the manner and to the ol 'lllY ncn • • l I I d • I ' II v ·d by the law or the lre.'.lttes o! l 1c coun•:-y w 1crc MIC 1 a war ts soug 11 to extent a o, c be n:licd upon. 2_ 'Die Gcr1<:va Protm:_ol on ~rbitration Clauses of I 92J and the _Gencv~. Convention ti Ev ·eution of Foreign Arhttral Awards of 1927 shall cease to nave died be1wcen Oil JC .,L Conlracting St:iles on their becoming bounJ and to the extent that they become bound by this Convention. ARTICLE VIII L This Convention shall be open until 31st Decemher, I 958 for signature on tx:half of any Member of !he United Nation:; and also on bdrnlf oJ any other State which is or hereafta become,<; member of any spcdaliscd agency of the United Nations, or which is or hcrea/'t,T bn:omes a party lo the Statute of the International Court of Justi-:e, or any other St:ite to which an invitation has been addressed by the General Assembly of the United N:1tions. 2 .. This Convention shall be ratified and the instnuncnt of ratitkation shall be deposited with the Secretary-General of the United Nations. ARTICLE IX 111is Convention shall be open for accession to nll Stales referred to in article . Accession shall be c!Tcctcd by the deposit of an instmmcnt of accession with the of the United Nations. ARTICLE X State may, at the time of signature, ratifi.c.'.ltion or acccssiou, declare that this "0¼S.>IJY:cn_l ic.m shull extend to :ill or uny of the territories for the intemational rclatiOJL'i of 11 ts responsible, Such a dedaration shall take effect wh1:n the Convention cntcr.; for the Stale rnnccmcd. any titne thereafter any such extension shall be made by notification addn:ssed of the United Nations and shall take effect as from the day after the day <Jf rcceipt by the Sccrctary-Gcner:d of tlw United Nati,'ns of . or as from the d:1te of entry into forc1: of the Convention fiJr the State wl11d1cvcr is the later. : . I ,,\~'1th respect to ti • • • · · · · ,,,,. . 1o~,1: tcrnloncs to which this Convcnt1on ts not cxtcndl·d :it the •7 s1,•11ature · t"fi • it <> : f'j 1. 1cat1011 or accession, each Stale conccmcd shall consider th<.: Y of tal~m" ti·· • • i d I I' • • 1 • t.•1' (> 1 • "' ,c .icccss:1ry stcp.s 111 oH c.:r to ex ten 11c app 1c:1tton ot t 11s 11 o such t • ·1 • ' • ,pfth. 'a , crri Ofll'S, ~llbJect, where necessary for cou1.;titutio11al r<.:asons. to the '' c mcm111cnts ol such territories. THE GAZETTE OF INDIA EXTRAORDINARY [P.\lff I! . -==============:::::: ARTICLE XI In th..; case of a federal or non-unitary State, th~ foiiowing provbions shall apply:~ (a) with rcspcl't to those articles of this Convention that come within the kgisl:itive jurisdiction of the federal authority, the obligritiou .. -; of the kdcral Gavcmrncn! shall to this extent be the same as those of Contrac:ing States which arc noi federal States; • (h) with respect to those ar!iclcs of this Ccnvcntion tlrnt come within Uic legislative jurisdiction of constitlll:nt State~ or provinces which arc not, under lhc constitutional sysll'.ln of the federation, bound to take lcgisbtivc action, the federal Govemmcnt shall hring such .irticks with a fovmm1blc recommendation to the notice of the appropriate authoriiks of constituent States or provin--·es at the earliest possible moment; (c) a federal State Party to this c;onvention shall, at the request of any other Contracting State transmiHe<l through lhc Sccrctary-Gcncrnl of the United Nations, suppiy a statement of the law and practice of the fr<lera!ion and its constituent units in regard to any particular provision of this Co11VL'.J1ti011, showing the ex.tent lo which cffei.:t has hcen given to that provision by legislative or othn action. ARTICLE XII 1. This Convention slrnli come inlo force on the ninetieth day following the date of deposit of the third instrnmcnt of ratification or accession. 2_ For each State radfyit!g or acceding to this Convcll(ion after the deposit of the third instrnmcnt of ratification or acces.,;ion, this Convention shall enter into force on the ninetieth day after deposit by such State of its instnm1ent of ratifi~tion or accession. ARTICLE X/1/ l. Any Contracting State may denounce this Convention by a written notification to the Secretary-General of the United Nations. Denuneiation shall take effect one year after the dat~ of receipt of the ,notification by the Secrclary-GcneraL 2. Any State which has made a declaration or notification under article X may, at any time thereafter, by notifo:ation 10 the Secretary-General of the United Nations, declare that this Convention shaH cease to extend to 1he territory concerned one year after the date of the rccdpt of the notification by the Secretary-General. 3. This Convention shall continue to be applicable to arbitral awards i11 respect of which recognition or enforcement proceedings have been instituted before the denunciation takes effect. ARTICLE XIV A Contracting State shall not be entitled to avail itscif of the present Convention ag:.1in!'>t other Contracting States except to the extent th~t it is itsc-lf bound lo apply the Convention. THE GAZETTE OF INDlA ~XTRAORDINARY si,<·. 11 ---=-==' ~_c::--- ARTICLE XV :n • G I of the U11itcd Na1io11s shall notify the Stales co11templatcd in S . ·rct·,ry- cn.:ra 'J11c cc • , . . VIII or ihc follow111g.- ar11dc • ltircs and rati!ic:1tions in accordance with article VIII; (a) s1gna • (b) accessions in :iccordance with article IX; (c) declarations and notifa·ations under articles I, X and XI; (d) the dale u1xm which this Convention enters into force i.11 accordance with ar1ick XII; (C") denunciations and notifications in accordance with article XIII. ARTICLE XVI 1, This Convention, of which the Chinese, English., French, Russian and Spanish texts shall be equally authentic, shall be deposited in the archives of the United Nations . . 2. The Secretary-General of the United Nations shall transmit a certified copy of this Convention to the States contemplated in article XITI . THE SECOND SCHEDULE (See section 53) PROTOCOL ON ARBITRATION CLAUSES . \The undersigned, being duly authorised, declare that they accept, on behalf of the ::/ ~<mntries which they represent, the following provisions:-:- :•,St;;~''i) :.f:. Each of the Contracting States recognises the validity of an agreement whethe1 ,,i!f,~l~g. to existing or future differences between parties subject respectively to the , lPr1,~.1ct101! of_ different Contracting States by which the parties to a contract agree to ~1!11t to a~11ration all or any differences that may arise in connection with such Atrac! rdatmg to commercial mal\crs or to any other matter capable of settlement by .;?-1t.r?1.1?n, whether or not the arbitration is to take place in a country to whose tJsd.tction none of the parties is subjecL ~}~:;~lsc::~~ctarin~ cS 0 tat~dresedrvcs the right. t1o litdnit ~e ob~igat1io1n men1~onecd above_ to fu( • . e 11s1 ere as commcrc1a un er Its nat10na aw. ruty 011tract111g 'N~t~wh.1ch avails itself of this right will notify the Secretary-General of the League of • >i ns 111 order that the other Contracting States may be so infonned. ·.• .. _.:.. . I C?·~otc~r~itral pro_cc<lurc, indu~ing the constitution _of the Arbitr_al Tribunal, ~hall c ,'arfiitr t' Y lhe will of the parties and by the Jaw ot the country m whose temtory .,-;;:(> /; a Ion takes place. :fi:E~o•~tractii'.g Slates agree to facilitate all steps in the procedure which require to Ill their ow t • • • • • • J • I l. 11 crr1:ancs, tn accordance with the prov1s1ons of t 1cir aw ar lltra\ proc•·<lt1r 1· l l • • d" ·r: ~ e app lea i c to extstmg ti crcnccs. 34 THE GAZETTE OF INDIA EXTRAORDINARY [PMn Ii--======= ============================:::::: 3. Eacl1 Cont:acting State_ ~ndertak:s to ~nsurc tJ1c executi~m by its authoritics alld in accordance with the prov1s101L<; of 1L,; naltonal laws of arbllral awards made in it_ own territory under the preceding articles. s 4. The Tribunals of the Contracting Parties, on being seized of a dispute regardui" a contract made between persons to whom Article 1 applies and including an Arbitratio~ Agreement whether referring to prcsent or future differences which is valid in virtue 0 ~ the said article and capable of being carried into effect, shall refer the parties on the application of either of them to the decision of the Arbitrators. Such reference shall not prejudice the competence of the judicial tribunals in case the agreement or the arbitration cannot proceed or becomes inopcr..itive. 5. l11e present Protocol, which shall n.:main open for signature by all States, shall be ratified. The ratification shall be deposited as soon as possible with the Secretary­ General of the League of Nations, who shall notify such deposit to all the Signatory States. 6. l11e present Protocol will come,. into force as soon as two ratifications have been deposited. Thereafter it will take effect, in the case of each Contracting Stale, one month after the notification by the Secretary-General of the deposit of its ratification. 7. l11e present Protocol may be denounced by any Contracting State on giving one year's notice. Denunciation shall be effected by a notification addressed to the Secretary-General of the League, who will immediately transmit copies of such notification to all the other Signatory States and inform ihem of the date on which it was received. The denunciation shall take effect one year · after the date on which it was notified to the Secretary-General, and shall operate only in respect of the notifying State. 8. The Contracting States may declare that their acceptance of the present Protocol docs not include any or all of the undermentioned territories: that is to say, tlicir colonies, overseas possessions or territories, protectorates or the territories over which they exercise a mandate. ~~ said Stales may subsequently adhere separately on behalf of any territory thus excluded. The Secretary-General of the League of Nations shall be infonned as soon as possible of such adhesions. He shall notify such adhesions to all Signatory States. They will take effect one month after the notification by the Secretary-General to aU Signatory States. l11e Contracting Slates may also denounce the Protocol separately on behalf of any of the territories referred to above. Article 7 applies to such denunciation. (See seetion 53) CONVENTION OF THE EXECITTION OF FOREIGN ARBITRAL AWARDS • Article 1.-( 1) In the territories of any High Contracting Party to which the pn:senl Convention a1)1>lies, an arliitral award made in pursuance of an agreement. whether . ") rclatino to cxistino or future dirfercnees (11creinaftcr called "a submission to arbitration b b h, covered by the Protocol on Arbitration Clauses opened at Geneva on September 24I l l---­ ==== THE GAZE1TE OF IN DIA EXTRAORDINARY 35 SEC I I ·-============= === = === = = = ==== === :::::::======-- sh :1 ll be recogni sed a~ binding and shall be ~nfor~e<l in a1.:cord:u~cc with the rul~s 1923 , • . ·<lure of the tantory where the award 1s rclu::<l upon, provided that the said of thc h~c'.c~ccn made in a krritory of one of the High Contracting Parties to which the awn rd Cas nvcntion applies :u1<l bdween persons who arc subject to the jurisdiction of Present O • • • f the Hinh Contr:1cllllg Parties. one O 0 (2) To obtain such recog11itio11 or enforcement, it shall, further, be nceessary:- (a) that the award has been i:nadc in pursuance of a submission to arbitration I · I 1·.., valid under the law appheablc then:to; w ue l J • (b) that the subject-matter of the award is capable of settlement by arbitration un<l.:r the ]aw of the country in which the award is sought to b<.". relied upon; (c) that the awar~ has been ~nade ~y the Arbitral Tribunal provided for. in the . ibmission to arbitration or consl!tutcd 111 the manner agree.cl upon by the parties and ~1~ eonfonnity with the law govcming the arbitration procedure; (cl) that the award has become final in the country ill which it has been made, in the sense that it will not be considered as such if it is open to opposition, appeal or pourvoi en cass arion (in the countries where such fonns of procc<lurc exist) or if it is proved that any proceedil1gs for the purpose of contesting the validity of the award arc pending; (e) that the n:cognition or enforcement of the award is not contrary to the public policy or to the principh:s of the law of the country ill which it is sought to be relic.cl upon. Arricle 2.-Even if the conditions laid down in Article 1 hereof arc fulfilled, recognition and enforcement of the award shall be refused if the Court is satisfied :- (a) that the award has been annulled in the country in which it was made; (b) that the party against whom it is sought to use the av-1ard was not given notice . , of the arbitration proceedings in sufficient time to enable him to present his cas e; or '•. that, being under a legal incapacity, he was not properly represented; >:.\t,,_,. . (c) that the award docs not deal with the differcuces contemplated by or falling ln ,:-',w1thin the tcnns of the suhmission to arbitration or that it contains decisions on ·" f~l·Fattcrs beyond the scope of the submission to arbitration. •.'.•.:• «;_>: ,[~1{\If the award has not covered all the questions submitted to the arbitral tribunal, the i:t~Stnpetcnt authority of the country where recognition or enforcement of the award is ::JB~ght can, if it thinks fit, postpone such recognition or enforcement or grarit it subject _;;~n/uch guarantee as that authority may decide. ,H;t i;-\~ic!e 3--I!' the party against whom the award has been made proves that, under t: ,)C aw govcmtng the arbitrntion procedure there is a 0 round other than the 0 ronn<ls ' erred t • • ' o , " o \ d. 0 _ lil Article l(a) and (c), and Article 2(6) and (e), entitling him to contes t the } , 11~ _01 the award in a Court of Law the Court may if it thinks fit either refuse gn1t1011 or c11t· r , f I d, d' I ' . I . ,h f . . h . . 0 cem:nt o t 1c awar or a Joum 11c cons1, cratlon t crco , g1nng ,· palrty a reasonable tune within which io have the aw::ird a1mu\lcd by Llw ,·otnpetcnt ~- • , , 36 THE GAZETTE OF INDIA EXTRAORDINARY [P,\Jn l[- Articfe 4.-The party relying upon an award.or claiming its cnforcemenl must supply in patiicular:- ' (1) the original awar<l or a copy lhereof duly aulhenticated, according to the requirements of the law of the cow1try in which it was made; (2) documentary or other evidence to prove thal the award has become final, in the sense defined' in Article l (d), in the country in ·which it was made; (3) when necessary, docwnentary or other evidence to prove Uwt the conditiom laid down in Article 1, paragraph (1) and paragraph (2) (a) and (c), have been fulfilled. A translation of the award and of the other documents mentioned in this Article into the official language of the country where the award is sought to be relied upon may be demanded. Such translations must be certified correct by a diplomatic or consular agent of the country to which the party who seeks to rely upon the award belongs or by a swam translator of the country where the award is sought lo be relied upon. Article 5.-The provisions of the above Articles shall not deprive any interested party of the right of availing himself of an arbitral award in the manner and to the extent allowed by the law or the treaties of the country where such award is sought to be relied upon. Article 6.-The present Convention applies only to arbitral awards made after the f'Otning into force of the Protocol on Arbitration Clauses opened at Geneva ou September 24th, 1923. Article· 7.- The present Convention, which will remain open to the signature of aU the signatories of the Protocol of 1923 on Arbitration Cl:rnscs, shall he ratifil"..d. It may be ratified only on behalf of those Members of the League of Nations and Non~Member States 011 whose behalf the Protocol of 1923 shall have been ratified. Ratification shall be deposited as soon as possible with the Secretary-General of tl1e League of Nations, who will notify such deposit to all the signatories. Article 8.-The present Convention shall come into force three months; after it shall have been ratified on behalf of two High Contracting Parties. Thereafter, it shall take effect, in the case of each High Contracting Party, three months after the deposit of tpe ratification on its behalf with the Secretary-General of tl1e League of Nations. Article 9.-The present Convention may be denounced on behalf of any Member of the League or Non-Member State. Denunciation shall be notified in writing to the Secretary-General of the League of Nations. who will immediately send a copy thereof, certified to be in confonnity with the 11otific.1tions, to all the other Contracting Parties, at the same time infonning them of-the date on which he received it. I The denunciation shall come into force only in respect of the High Contr.1cting Party which sh.111 have notified it and one year after such notilication shall have reached the Secrclary-General of the League of Nations. TI1e dcmmciation of the Protoc(;l on Arbitration Clauses shall cnt.1il, ipso facto, the denunciation of the present Convention. ~ZETIE OF INDIA EXTRAORDINARY 37 . 1, 10 _ The present Con vent ion docs not apply to the colonies, protectorates or Ar(IC c • • · ' f H. h C • I . . .. unckr su1.cramly or ma11ualc o any 1g 011trac1111g Party un css !hey arc tern tori, s . .- . lly mcnt1011cd. SJH:cl ,I 11 )1)1 .,1.:;ition of this Convention to one or more of such colonies, protectorates ic a1 . . . 1-!<ii·il:s to whidi the Prolot:ol 011 Arb11rat1on Clauses opened at Geneva on or kff 1· b ff •1 • b d • , _ ,r ''4th 1923 app 1c_-;, can e c ccteu at any tune y means of a cclara11ou Scptcmuc, ... • ' ' ., . . ... , to the Secretary-General of the League of Nations by one of the Hfah 'I( uf<.:SSCU ~ Contracting Parties. Such declaration shall lake effect three months after the deposit thereof. •nic High Contracting Parties can al any time denounce the Convention for all or any of the Colonic.s, Protectorates or territories referred to above. Article 9 hereof applied to such denunciation. Article 1 l . ..:..A certified copy of the present Convention shall be transmitted by the S<.:crctary-General of the League of Nations to ev..:ry Member of the League of Nations anJ 10 every Non-Member State which signs the same. ', SHANKER DAYAL SHARMA, President. K. L. MOHANP\JRIA Ser.y. to the Govt. of India'. '