Dissertation Revised

A STUDY ON THE IMPACT OF UNCITRAL
MODEL OF DISPUTE RESOLUTION IN INDIAN

CORPORATE SECTOR
A Research Project Work towards fulfilment of LL.M for the academic session
of 2018-2019
A PROJECT WORK
SUBMITTED BY:
PALLAVI DAS
LL.M
Regd No.- 1861811021
Batch- 2018-2019
Under the Guidance and Supervision of
Ms. Swati Mohapatra
SOA NATIONAL INSTITUTE OF LAW (SNIL)

SIKSHA ‘O’ ANUSHANDAN UNIVERSITY, ODISHA, INDIA
0
TABLE OF CONTENTS
SL. NO CONTENTS PAGE

1 Introduction and Review 8-23
of Literature
2 Analysis of Legislative 24-60
Provisions
3 Judicial Decisions 61-75
4 Success and Criticism of UNCITRAL 76-81
Model Laws on dispute
resolution mechanism
5 A Comparative Study 82-90
6 Appraisals and Suggestions 91-101
1
ACKNOWLEDGEMENT
First of all, I would like to take this opportunity with esteem privilege to express my heartfelt
thanks and gratitude to my course teacher for awarding this project topic of large importance.
At the very outset, I would like to thank those who were the ‘guiding lights’ behind this
project. It is an honor to acknowledge, since a work starts with dedication carries the meaning
and has eloquence within and I would like to express my earnest gratitude to Ms. Swati
Mohapatra for giving me opportunity to do a project on this vibrant topic of “, A STUDY
ON THE IMPACT OF THE UNCITRAL MODEL LAW ON DISPUTE
RESOLUTION MECHANISM IN INDIAN CORPORATE SECTOR”
I am thankful to the assistance, guidance and support which she extended during the course of
research. I would like to thank my university for allowing me to avail the computer lab,
internet facilities and the library without which the project would have been in a distant
realm.
Above all, I thank God in enabling the successful competition of the project.
PALLAVI DAS
LL.M
Reg. No 1861810021
Soa National Institute of Law (SNIL)
S’O’A University, Odisha, India
2
DECLARATION
I, Pallavi Das, a student of LL.M do hereby declare that the present piece of dissertation work
entitled, A STUDY ON THE IMPACT OF THE UNCITRAL MODEL LAW ON
DISPUTE RESOLUTION MECHANISM IN INDIAN CORPORATE SECTOR being
presented in partial fulfilment of requirement for the degree of Master in Laws 2018-2019 of
SOA University, is based on my own work and has not been submitted at any time.
PALLAVI DAS
LL.M
Reg. No 1861810021
3
GUIDE CERTIFCATE
This is to certify that the dissertation entitled “A Study on the impact of the UNCITRAL
Model Law of Dispute Resolution Mechanism In Indian Corporate Sector” submitted by
Pallavi Das, LL,M, Regd. No. 1861811021 in partial fulfilment of requirement of the award of
degree in Master of laws, is a bona fide research work done by her under my guidance.
Guide’s Signature
Ms. Swati Mohapatra

4
PREFACE
It gave me an immense pleasure to write a preface of my Research Work titled “A STUDY

ON THE IMPACT OF UNCITRAL MODEL LAW OF DISPUTE RESOLUTION
MECHANISM IN INDIAN CORPORATE SECTOR.”
In the first chapter, I have introduced the topic in brief.
In the second chapter, I have laid emphasis on the legislative provision stating the impact of
the UNCITRAL Model Laws in the Indian Corporate Sector
In the third chapter, I have dealt with the judicial decisions.
In the fourth chapter, I have explained about the success and criticism of the UNCITRAL
Model Laws in the Indian Corporate Sector.
In the fifth chapter, I have dealt with the comparative study.
In the sixth chapter, I have dealt with the conclusion to the topic.
I have tried my best to explain the subject matter in a best possible way and had tried to omit
the errors, if found any, I request the student reading the research work, and the teacher who
are honoring me by using the same, to let me know those errors and omissions, so that I can
rectify the omissions in my next research work. Needless to say such suggestions will be
gratefully received and acknowledged.!
PALLAVI DAS
LL.M
Reg. No 1861811021
SOA National Institute of Law (SNIL)
5
TABLE OF CASES
I. Gas Authority of India v M/S Keti Constructions (I) Ltd.

II. Thyssen Stahlunion Gmbh Etc v. Steel Authority of India
III. M/S S.B.P and Co vs M/S Patel Engineering Ltd. and Anr
IV. Marriott International Inc. And……. Vs Ansal Hotels Ltd.&
Another
V. Sime Darby Engineering Sdn, Bhd vs. Engineers India Ltd.
VI. Vikrant Tyres Limited and Another vs. Techno Expert Foreign
Trade
VII. M.M.T.C Limited vs. Priyanka Overseas Limited
VIII. M/S Konkan Railway Corpn. Ltd. Vs. M/S Rani Construction Pvt.
Ltd.
IX. Shin-Etsu Chemical Co. Ltd. Vs. M/S Akash Optifibre Ltd. And
Anr.
X. Aastha Broadcasting Network Ltd. Vs. Thaicom Public Company
Ltd.
XI. M/S Nilkamal Ltd. Vs., Patna vs. The State of Bihar and Ors
XII. Union of India Ministry Of ….. vs Hardy Exploration and
Production
XIII. Enercon (India) Ltd. & Ors. v. Enercon GmbH & Anr.
XIV. Malini Venture v. Knight Capital Pte Ltd. and others
XV. BNP Paribas & Ors. v. Deloitte & Touche LLP
XVI. GE Capital (Thailand) Company Limited v. Noppadol
Manorotpanich
XVII. Alberta Court of Appeal (Fraser, Conrad JJ. A., Picard J.)
6
Chapter I
INTRODUCTION AND REVIEW OF LITERATURE
7
INTRODUCTION AND REVIEW OF LITERATURE
What is Dispute Resolution Mechanism?
A dispute mechanism is a structured process that addresses disputes or

grievances that arise between two or more parties engaged in business, legal or societal
relationships.1 It is also known as grievance mechanism and it is totally non-judicial in nature.
They are not resolved in a Court of Law. Alternative Dispute Resolution (ADR) Mechanisms
are alternative methods that are independent, objective and impartial third party provides the
parties of a legal dispute to reach an agreement about the dispute by bringing them together
and communicating with each other. It includes dispute resolution processes and techniques
that act as means for disagreeing parties to come to an agreement short of litigation. It is a
collective term for the ways that parties can settle disputes, with the help of a third party.2
UNCITRAL has two main model laws that deal with these dispute resolution
mechanisms. One is the “UNCITRAL Model Law on International Commercial Arbitration”
and the other is “UNCITRAL Model Law on International Commercial Conciliation”. The
former deals with international commercial conciliation whereas the latter deals with
international commercial arbitrations.
What is UNCITRAL?
UNCITRAL stands for United Nations Commission on International Trade
Law. It is one of the core legal bodies established by the General Assembly of the UN in 1996
(Resolution 2205 (XXI) of 17 December 1996). 3 It is a body that specializes in commercial
law reform. An improved legal framework is very much essential in today’s world where there
1
Dispute mechanism – Wikipedia; https://en.wikipedia.org/wiki/Dispute_mechanism; 23 April 2019
2
Alternative dispute resolution – Wikipedia; https://en.wikipedia.org/wiki/Alternative_dispute_resolution; 24
April 2019
3
; United Nations Commission on International Trade Law – Wikipedia;
https://en.wikipedia.org/wiki/United_Nations_Commission_on_International_Trade_Law; 09 April 2019
8
is an increase in international trade and investment.4 International trade has tremendously
increased because of the increase in globalization. Because of this urbanization and
globalization, people prefer to enhance their trade by taking it to international level. Where
there is trade, it is obvious that disputes will arise. In international trade also, disputes may
arise. To solve these disputes, UNCITRAL was established by the General Assembly of the
UN.
UNCITRAL was established for progressive harmonization and modernization of the law
of international trade. The areas which the UNCITRAL include are : dispute resolution,
international contract practices, transport, insolvency, electronic commerce, international
payments, secured transactions, procurement and sale of goods. UNCITRAL consists of 60
members out of which 14 are African States, 14 are Asian States, 8 are Eastern European States,
10 are Latin American and Caribbean States and 14 are Western European and other States. 5
The members States represent different legal traditions and levels of economic development
who are elected for a term of 6 years and every three years, the terms of half of the members
expire.
UNCITRAL Model Law On International Commercial

Arbitration
The UNCITRAL Model Law on International Commercial Arbitration was prepared by the
UNCITRAL and adopted on 21 June 1985.6 The UNCITRAL Model Law was very much
needed for international trade because domestic laws are often inappropriate for international
cases. It is quite natural that domestic laws will deal with disputes related to domestic trade. It
will not be applicable in international trade. In this era of globalization and urbanization, there
has been a tremendous growth of international trade. So definitely there should be a body that
deals specifically with international trade.
4
Pg 1; A Guide to UNCITRAL: Basic facts about the United Nations Commission on International Trade Law - 12-
57491-guide-to-uncitral-e.pdf; https://uncitral.un.org/sites/uncitral.un.org/files/media-
documents/uncitral/en/12-57491-guide-to-uncitral-e.pdf; 06 August 2018
5
Pg 3; A Guide to UNCITRAL: Basic facts about the United Nations Commission on International Trade Law - 12-
57491-guide-to-uncitral-e.pdf; https://uncitral.un.org/sites/uncitral.un.org/files/media-
documents/uncitral/en/12-57491-guide-to-uncitral-e.pdf; 06 August 2018
6
UNCITRAL Model Law on International Commercial Arbitration – Wikipedia;
https://en.wikipedia.org/wiki/UNCITRAL_Model_Law_on_International_Commercial_Arbitration; 29 March
2019
9
Many countries have enacted their national arbitration act according to this Model Law and
India is one of them. The General Assembly of the UN recommended that all countries give
due consideration to this Model Law, in view of the desirability of uniformity of the law of
arbitral procedures and the specific needs of international commercial arbitration practices.
India has enacted the Arbitration and Conciliation Act,1996 based on the UNCITRAL Model
Law on International Commercial Arbitration. This Arbitration and Conciliation Act, 1996
repealed the old Arbitration Act of India i.e., the Arbitration Act, 1940 and came into force.
The UNCITRAL Model Law adopted mainly for two reasons:
I. Inadequacy of domestic laws of arbitration
The facts demonstrate that residential laws are insufficient in global cases.
A portion of the national laws are additionally obsolete. In the event that we return to the
nineteenth century, they liken the arbitral procedure with Court prosecution. These two are
very extraordinary. Different laws might be said to be fragmentary. Thus, these laws don't
address all the important issues. Regardless of whether a portion of the laws have all the
earmarks of being forward-thinking and thorough, they are drafted with household mediation
principally, if not solely as a main priority.
Since universal and local mediation are very not the same as one another,
there ought to be two separate laws to manage them. Household laws on mediation are
sufficient for cases identifying with worldwide intervention. Consequently, there should a
different law managing with universal business assertion. The UNCITRAL Model Law is one
such body that manages global business mediation. Thus, this Model Law was instituted.
II. Disparity between National Laws of Arbitration
The national laws on assertion vary generally. They contrast from

nation to nation. These distinctions are a successive wellspring of worry in worldwide
assertion. In light of this issues and undesired outcomes may emerge, regardless of whether
they exude from required or non-obligatory arrangements. Now and again, one of the
gatherings to global discretion or even both the gatherings to intervention are gone up against
10
with remote and new techniques and arrangements. For a gathering who doesn't see any outside
system and arrangement, it would be costly, unreasonable or difficult to get a full and exact
record of the law relevant to assertion
Along these lines, the UNCITRAL Model Law on International
Commercial Arbitration was received by the UNCITRAL on 21st June 1985, at the end of the
Commission's eighteenth yearly session. This Model Law is acknowledged worldwide and the
household laws on mediation of numerous nations depend on this Model. It establishes a sound
and promising reason for the ideal harmonization and improvement of national laws. It is
particularly basic for settling the debates identifying with universal intervention. All phases of
the arbitral procedure going from the discretion consent to the acknowledgment and
requirement of the arbitral honor are secured by this Model Law. The most significant
highlights of this Model Law is that it is satisfactory to States all things considered and the
diverse legitimate or financial frameworks of the World. Along these lines, the UNCITRAL
Model Law is an overall accord on the rule and significant issues of worldwide assertion
practice.
Salient Features of the UNCITRAL Model Law on International

Commercial Arbitration
The salient features of the UNCITRAL Model Law on International Commercial

Arbitration are as follows:
I. Scope of Application of the Model Law
Article 1 of the UNCITRAL Model Law on International Commercial Arbitration

manages "Extent of Application" of the Model Law. It expresses that "this law applies to global
business discretion, subject to any understanding in power between this State and some other
State or States." So it is very obvious from the arrangement of Article 1 that this Model Law is
just appropriate if there should be an occurrence of universal business assertion. It isn't
appropriate to residential assertion.
The reference to Article 1 expresses that the word 'business' ought to be given
11
wide elucidation. It covers matters emerging from all connections of a business nature,
regardless of whether legally binding or not. Connections of a business natures incorporate :
any exchange for the supply or trade of products or administrations; dissemination
understanding; business portrayal or office; considering; renting; development of works;
counseling; building; permitting; speculation; financing; banking; protection; abuse
understanding or concession; joint endeavor and different types of mechanical or business
collaboration; carriage of merchandise or travelers via air, ocean, rail or street.
For an assertion to be global, it ought to satisfy certain conditions (Article 1(3)).
They are as per the following:
(i) The gatherings to a discretion understanding have, at the season of the finish of that
understanding, their places of business in various States; or
(ii) One of the accompanying gatherings is arranged outside the State in which the
gatherings have their places of business:
(a) The spot of intervention is resolved in, or compliant with, the mediation
understanding;
(b) Any place where a considerable piece of the commitments of the business relationship
is to be performed or the spot with which the topic of the debate is most firmly associated; or
(iii) The parties have explicitly concurred that the topic of the intervention understanding
identifies with more than one nation.
There is another part of the regional extent of utilization. As indicated by Article 1(2), the
Model Law as ordered in a given State would apply just if the spot of intervention is in the
domain of that State however it is liable to specific exemptions. The arrangements of this Model
Law does not make a difference to Articles 8,9,17 H, 17 I, 17 J, 35 and 36. Articles 8 and 9
manage acknowledgment of discretion understandings, incorporating their ability with between
time measures. Article 17 H arrangements with "Acknowledgment and Enforcement of
between time measures." Article 17 I arrangements with "Justification for rejecting
12
acknowledgment or implementation interval measures" and Article 17 J arrangements with
"Court-requested break measure". Articles 35 and 36 manage "Acknowledgment and
Enforcement of arbitral honors" and "Justification for declining acknowledgment or
authorization of arbitral honors" separately. Articles 35 and 36 are given on a worldwide scale,
i.e., regardless of whether the spot of mediation is in that State or in another State. Articles 8
and 9 are given on a worldwide scale regardless of whether the spot of discretion isn't yet
decided.
Thus, it is very certain that the UNCITRAL Model Law on International
Commercial Arbitration applies just in the event of worldwide business discretion and not if
there should be an occurrence of residential assertion. This Model Law applies just if the spot
of assertion is in the region of that state. Anyway, certain special cases are there where this
Model Law applies on a worldwide scale i.e., they apply independent of whether the spot of
mediation is in that State or in another State. This Model Law will not influence some other
law of this State.
This exacting regional measure of the Model Law was embraced for conviction
in light of the fact that frequently the spot of assertion is utilized as the elite rule by
extraordinary greater part of national laws. In spite of the fact that the national laws enable the
gatherings to pick the procedural law of a State other than that where the intervention happens,
encounters demonstrate that the gatherings practically speaking once in a while utilize that
office. The Model Law has decreased the requirement for such a decision of a 'remote law'
since it stipends parties wide opportunity in molding the principles of the arbitral procedures.
In perspective on this, the Model Law has fused into their mediation understanding procedural
arrangements of a 'remote' law.
Arbitration Agreement
Chapter II if the UNCITRAL Model Law on International Commercial

Arbitration deals with the Arbitration Agreement. It contains various provisions related to
“arbitration agreement” such as “Definition” of arbitration agreement’ “Form” of arbitration
agreement, “Arbitration Agreement and substantive claim before the Court” and “interim
measures” by Court. These provisions are contained in Articles 7,8 and 9 of the Model Law.
Composition of Arbitral Tribunal
13
Chapter III of the UNCITRAL Model Law on International Commercial
Arbitration deals with the “Composition of Arbitral Tribunal”. The provisions are contained in
Articles 10-15. It contains various provisions such as how many number of arbitrators should
be appointed; what are the conditions for the appointment of an arbitrator and how an arbitrator
is appointed. It also contains provisions for the appointment of an arbitrator if the parties fail
to agree for the appointment of an arbitrator. The grounds for challenge of an arbitrator as well
as the procedure for challenge are also contained in these articles.
Jurisdiction of Arbitral Tribunal
Chapter IV of the UNCITRAL Model Law on International Commercial

Arbitration deals with the “Jurisdiction of Arbitral Tribunal”. The provisions are contained in
Article 16 of the Model Law which deals with “Competence of Arbitral Tribunal to rule on its
own jurisdiction”. It adopts that the arbitral tribunal may rule on its own jurisdiction. Under
Article 17, the Model Law empowers the arbitral tribunal to order any party to take an interim
measure of protection in respect of the subject-matter of the dispute, if so requested by a party.
Conduct of Arbitral Proceedings
Chapter V of the UNCITRAL Model Law on International Commercial

Arbitration deals with the “Conduct of Arbitral Proceedings”. Articles 18-27 contain the
provisions relating to the conduct of arbitral proceedings. It contains provisions relating to
fundamental procedural rights of a party such as there should be equal treatment of the parties,
the parties are free to agree on the procedure to be followed by the arbitral tribunal in
conducting the proceedings and the parties are also free to agree on the placer of arbitration.
Article 22 states that the parties are free to agree on the language or languages to be used in the
arbitral proceedings.
Making of Award and Termination of Proceedings
14
Chapter VI of the UNCITRAL Model Law on International Commercial
Arbitration deals with the “Making of Award and Termination of Proceedings”. Articles 28-33
contain the provisions relating to making of award and termination of proceedings. It states
that the arbitral tribunal shall decide the dispute in accordance with such rules of law as are
chosen by the parties as applicable to the substance of the dispute (Article 28). 7 It also contains
provisions such as “Settlement of the award”, Form and Contents of the award”, “Termination
of proceedings” and “Correction and interpretation of the award”.
Recourse Against Award
Chapter VII of the UNCITRAL Model Law on International Commercial

Arbitration deals with “Recourse against award”. Article 34 contains the provisions related to
this. It states that recourse to a Court against an arbitral award may be made only by an
application for setting aside. The application for setting aside should be made within 3 months
of receipt of the award. It also contains an exclusive list of limited grounds on which an award
may be set aside.
Recognition and Enforcement of Awards
Chapter VIII of the UNCITRAL Model Law on International Commercial

Arbitration deals with the “Recognition and enforcement of awards”. Articles 35 and 36
contain the provisions relating to this. Article 35 states about the procedural conditions of
recognition and enforcement whereas Article 36 states about the grounds for refusing
recognition or enforcement.
7
Pg 17; UNCITRAL Model Law on International Commercial Arbitration 1985, With amendments as adopted in
2006 - 07-86998_Ebook.pdf; https://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/07-
86998_Ebook.pdf; 15 January 2008
15
UNCITRAL Arbitration Rules
The Arbitration Rules of UNCITRAL was adopted on 15th December 1976.8 It is a set
of procedural rules on arbitration which is used for the settlement of disputes between parties
in the context of international commercial relations. These rules cover all the aspects of an
arbitral process ranging from disputes between private commercial parties, investor-state
disputes, State-State disputes and commercial disputes.9 At present, there exists three different
versions of the Arbitration Rules (i) the 1976 version; (ii) the 2010 revised version ; and (iii)
the 2013 revised version. The Arbitration Rules are framed in 4 sections. They are as follows :
(i) Introductory Rules (Articles 1-4); (ii) Composition of the Arbitral Tribunal (Articles 5-14);
(iii) Arbitrary Proceedings (Articles 15-20) and (iv) The Awards (Articles 31-41).
The UNCITRAL Arbitration Rules were adopted by the UNCITRAL in 1976 and in
the same year, the General Assembly of the UN also recommended that these Arbitration Rules
should be used for the settlement of disputes arising in the context of international commercial
relations. Since then, the UNCITRAL Arbitration Rules have become well known and are
widely used around the world. 10
What is Arbitration?
In simple words, arbitration is the act of dispute settlement through an
arbitrator i.e., a third party, who is not involved in the dispute.11 It is an alternate dispute
settlement mechanism, aiming at settlement outside the Court.
What is Conciliation?
8
Para 1; Pg 364; S.R Myneni; International Trade Law; 2015
99
UNCITRAL Arbitration Rules | United Nations Commission On International Trade Law;
https://uncitral.un.org/en/texts/arbitration/contractualtexts/arbitration; 07 April 2019
10
Para 7; Pg 369; S.R Myneni; International Trade Law; 2015
11
Arbitration in India - Mechanism and Challenges – ClearIAS; https://www.clearias.com/arbitration-in-india/;
30 April 2019
16
Conciliation is an alternate dispute resolution process whereby the parties to a dispute use a
conciliator, who meets with the parties both separately and together in an attempt to resolve
their differences.12
UNCITRAL Model Law on International Commercial

Conciliation
International trade and commerce have grown rapidly with cross border
transactions being entered into by a growing number of entities, including small and medium
sized entities. With the increasing use of electronic commerce, where business is frequently
conducted across national boundaries, the need for effective and efficient dispute resolution
systems has become paramount. UNCITRAL has drafted this Model Law to assist states in
designing dispute resolution processes that are intended to reduce costs of dispute settlement,
foster maintaining a co-operative atmosphere between trading parties, prevent further disputes
and inject certainty in international trade.
The UNCITRAL Model Law on International Commercial Arbitration has total 14
Articles that deal with international commercial conciliation. The Model Law was developed
in the context of increasing use of conciliation as a method for settling commercial disputes. It
was designed to provide uniform rules in respect of the conciliation process.
Modes and Practices of ADR in India
ADR can be broadly classified into two categories : Court-annexed

options (Mediation, Conciliation) and community based dispute resolution mechanism (Lok-
Adalat).
The modes of practice of ADR in India are as follows:
12
Conciliation – Wikipedia; https://en.wikipedia.org/wiki/Conciliation; 15 April 2019
17
1. Arbitration
Arbitration implies any mediation whether regulated by a perpetual arbitral

establishment. It is a method where the question is submitted to an arbitral council which settles
on a choice (a "grant") on the debate that is official on the gatherings. Area 2(a) of the
Arbitration and Conciliation Act,1996 relates with Article 2(a) of the Model Law.
The various sorts of arbitration are as per the following:
(i) Ad Hoc Arbitration
An Ad Hoc Arbitration is one which isn't directed by a foundation and along these lines, the
gatherings are required to decide all parts of the discretion like the quantity of authorities, way
of their arrangement and so forth. It is consented to and masterminded by the gatherings
themselves. It is increasingly adaptable, less expensive and quicker than a directed continuing.
(ii) Institutional Arbitration
An institutional arbitration is one in which a particular organization with a changeless character

intercedes and accept the elements of supporting and regulating the arbitral procedure, as
indicated by the principles of that establishment.
(iii) Fastrack Arbitration
Fastrack Arbitration is a period bound discretion, with stricter guidelines of

system, which don't permit any laxity for expansions of time, and the resultant postponements,
and the decreased range of time makes it more practical. Areas 11(2) and 11(3) of the
Arbitration and Conciliation Act,1996 gives that the gatherings are allowed to concur on a
technique for naming a judge and pick the quickest method to challenge an arbitral honor
individually.
18
2. Mediation
Mediation is a process in which the mediator, an external person, neutral to the
dispute, works with the parties to find a solution which is acceptable to all of them. It is
negotiation carried out with the assistance of a third party. However, the mediator, in contrast
to an arbitrator or Judge, has no power to impose an outcome on disputing parties. The Village
Panchayats and the Nyaya Panchayats are good examples for this. In India, mediation has not
been yet popular. One of the main reasons for this is that mediation is not a formal proceeding
and it cannot be enforced by Courts of law.
3. Conciliation
Conciliation is a procedure wherein an impartial individual meets the
gatherings to a question which may be settled; a moderately unstructured strategy for debate
goals wherein an outsider encourages correspondence between gatherings trying to enable them
to settle their disparities. Segment 61 of the Arbitration and Conciliation Act,1996
accommodates pacification of debates emerging out of lawful relationship, regardless of
whether legally binding or not and to all procedures relating thereto.
4. Lok Adalats
Lok Adalat was first presented in 1982 and the first Lok Adalat was started in Gujarat. The
development of this development was a piece of the system to soothe overwhelming weight of
Courts with pending cases.
The Arbitration and Conciliation Act,1996
In India, there was earlier an Arbitration Act i.e., the Arbitration Act 1940. The
Arbitration Act had become outdated. Therefore, the Government of India decided to review
the Arbitration Act,1940. So it referred the matter to the Law Commission in 1977 for its
19
examination. The Law Commission of India recommended for updating the Arbitration Act of
1940 in its 76th Report. This was done in order to meet the new challenges of the modern
developing economy of the country. 13
Even after the recommendation of the Law Commission. The Arbitration
Act,1940 continued up to 1996. An Arbitration and Conciliation Bill was introduced in the
Rajya Sabha on 16th May,1995. Later an Ordinance was promulgated on 16th January,1996
which came into force on 25th January,1996. 14 The Government of India consolidated the law
of arbitration in the Arbitration and Conciliation Ordinance,1996 and published it in the
Gazette of India.
The Government of India enacted this ordinance keeping in mind a lot of
things. The UNCITRAL Model on International Commercial Arbitration which was adopted
by the UNCITRAL is the main reason behind the enactment of this ordinance. The General
Assembly of the UN had recommended that in case of any dispute in the context of international
commercial relations, the UNCITRAL Model Law on International Commercial Arbitration
will prevail. The Government of India thought it would be reasonable to enact the arbitration
law in India taking into account the UNCITRAL Model Law on International Commercial
Arbitration.
The Parliament could not pass the Arbitration and Conciliation Bill,1995.
Therefore, the ordinance had to be promulgated twice until it was finally passed as “The
Arbitration and Conciliation Act,1996”. This Act repealed the Arbitration Act of 194, the
Arbitration (Protected and Convention) Act, 1937 and the Foreign Awards (Recognition and
Enforcement) Act, 1961. 15
The Indian Arbitration and Conciliation act,1996 is based on the UNCITRAL
Model Law on International Commercial Arbitration as well as the UNCITRAL Model Law
on International Commercial Conciliation. Though the UNCITRAL Model Law was intended
mainly to deal with International Commercial Arbitration and Conciliation, they could, with
appropriate modifications, serve as a model for legislation on domestic arbitration and
conciliation.
UNCITRAL Model Law and the Arbitration and Conciliation

Act,1996
13
Para 10; Pg 67; S.R Myneni; Alternate Dispute Resolution; 2015
14
15
20
The Arbitration and Conciliation Act,1996 is based on the UNCITRAL Model Law on
International Commercial Arbitration as well as the UNCITRAL Model Law on International
Commercial Conciliation The Sections in the Arbitration and Conciliation Act,1996
corresponds to the Articles of the UNCITRAL Model Law on International Commercial
Arbitration and International Commercial Conciliation. The provisions are kept same in order
to maintain a uniformity in the arbitration laws as well as in conciliation laws. This helps in
solving disputes relating to arbitration and conciliation in a better way. We can say that the
UNCITRAL Model Law is the genus whereas the Arbitration and Conciliation Act,1996 is the
species.
Since the time of the adoption of the Arbitration and Conciliation Act,1996, we
can see through a lot of judicial decisions that the Courts’ priority is the UNCITRAL Model
Law on International Commercial Arbitration as well as International Commercial
Conciliation. The Courts while giving their judgement have always kept the UNCITRAL
Model Law in their mind and thereby gave their judgement. The UNCITRAL Model Law plays
a vital role in the laws of arbitration in India.
Indian Council of Arbitration
In India, the Indian Council of Arbitration established in 1965 is the apex

arbitral organization at the national level. The main objective of this Council is to promote the
amicable and quick settlement of industrial and trade disputes by arbitration. The Government
of India, the Federation of Indian Chambers of Commerce and Industry, other important
chambers of commerce and trade associations in India as well as export promotion councils,
public sector undertakings, companies and firms are in its membership.16 The ICA has framed
its rules of arbitration comparable to international standards for conduct of arbitration
proceedings. The 1996 Act provides statutory recognition to conciliation as a distinct mode of
dispute settlement and contains detailed procedure governing arbitration and conciliation
proceedings.
Review of Literature
16
Council of Arbitration – WikiMediation; http://en.wikimediation.org/index.php?title=Council_of_Arbitration;
13 November 2013
21
As the statement of the problem is “A Study on the impact of the UNCITRAL
Model of Dispute Resolution Mechanism in Indian Corporate Sector”, the literature consisted
mainly of case laws. The Researcher thought it fit to confine the study to High Court decisions
on matters relating to arbitration in India. The Arbitration and Conciliation Act,1996 is based
upon the UNCITRAL Model Law on International Commercial Arbitration as well as the
UNCITRAL Model Law on International Commercial Conciliation. The Arbitration and
Conciliation Act came into force in 1996 and it repealed the old Arbitration Act prevailing in
India i.e., “The Arbitration Act,1940”. The UNCITRAL Model Law was adopted in the year
1985 and the General Assembly of the UN recommended that all member states should give
due consideration to this Model Law in view of the uniformity and desirability of the law of
arbitral procedure and the specific needs of international commercial arbitration practice.
Therefore, the High Court while deciding cases on arbitration has given due consideration to
the UNCITRAL Model. All the decisions of the High Courts on arbitration reports in All India
Reporter, a reputed legal journal was identified and collected, of the study. All such decisions
were perused by the researcher and carefully studied. Treaties, Textbooks, Reference books
and some articles in the journal which dealt with the arbitration in India were also studied.
Bibliography at the end of this thesis enumerates all these books and periodicals. To name, few
renowned authors whose books were studied by the researcher : S.R Myneni, P.C Maknanda,
S.C Tripathy, S.K Chawla and B.S Patil.
Statement of the Problem
Present research problem relates to the tracing of vicissitudes of judicial

interpretation of arbitration laws relating to India. After perusing all cases decided by the High
Courts in this regard, the possible direction of the judicial trend may be noticeable. The research
problem concerns to outline various legislations and judicial trends in relation to arbitration.
The research problem under study is defined as “A Study on the impact of the UNCITRAL
Model of dispute resolution mechanism in Indian Corporate Sector”.
Significance of the Study
The Arbitration and the Conciliation Act,1996 is based upon the UNCITRAL
Model Law on International Commercial Arbitration as well as the UNCITRAL Model Law
on International Commercial Conciliation. The articles in the UNCITRAL Model Law
22
correspond with the sections in the Arbitration Act. The Arbitration Act has been enacted
keeping in mind the UNCITRAL Model Law. Therefore, it is necessary to study how the
UNCITRAL Model Law impacts the Arbitration and Conciliation laws in India.
Under the UNCITRAL Model Law on International Commercial Arbitration,
Chapter I deals with “General Provisions”; Chapter II deals with “Arbitration Agreement”;
Chapter III deals with the “Composition of Arbitral Tribunal”; Chapter IV deals with
“Jurisdiction of Arbitral Tribunal”; Chapter V deals with “Conduct of Arbitral Proceedings”;
Chapter VI deals with “Making of Award and Termination of Proceedings”; Chapter VII deals
with “Recourse against Award” and Chapter VIII deals with “Recognition and Enforcement of
Awards”.
Under the Arbitration and Conciliation Act,1996, Chapter I deals with “General
Provisions”; Chapter II deals with “Arbitration Agreement”; Chapter III deals with
“Composition of Arbitral Tribunal”; Chapter IV deals with “Composition of Arbitral
Tribunal”; Chapter V deals with “Conduct of Arbitral Proceedings”; Chapter VI deals with
“Making of Award and Termination of Proceedings”; Chapter VII deals with “Recourse against
Award” and Chapter VIII deals with “Recognition and Enforcement of Awards”. Thus we
can see that the Arbitration and Conciliation Act,1996 is in line with the UNCITRAL Model
Law on International Commercial Arbitration. Almost all the provisions of the Arbitration act
are same as that of the UNCITRAL Model Law. But the Arbitration Act makes a departure
from the said Model Law to some extent.
Hypothesis
The hypothesis which is formulated in the beginning of the study are :

1. The Role of the UNCITRAL Model Law in the Indian Arbitration and Conciliation
Laws.
2. Analysis of legislative provisions related to arbitration and conciliation.
3. Judicial Decisions on Arbitration and Conciliation in India
4. Achievements of the UNCITRAL Model Law in the Indian Arbitration and
Conciliation laws.
5. Criticism of the UNCITRAL Model Law.
6. Examining 20 years of UNCITRAL Model Law and Indian Arbitration and
Conciliation Laws.
23
Chapter II
ANALYSIS OF LEGAL PROVISIONS
24
ANALYSIS OF LEGAL PROVISIONS
The UNCITRAL Model Law on International Commercial

Arbitration deals with the laws of arbitration at an international level. It has a major influence
in the arbitration laws of India. The Arbitration Act of India i.e., “The Arbitration and
Conciliation Act,1996” is based on this Model Law. Therefore, while studying the legal
provisions, we have to simultaneously study the UNCITRAL Model Law on International
Commercial Arbitration as well as the Arbitration and Conciliation Act,1996.

Arbitration
The UNCITRAL Model Law on International Commercial Arbitration

was adopted by the UNCITRAL in 1985 and it deals specifically with maters relating to
international commercial arbitration. Chapter II of the Model Law deals with “Arbitration
Agreement”. Chapter III deals with “Composition of Arbitration Agreement”. Chapter IV deals
with “Jurisdiction of Arbitral Tribunal” and Chapter IVA deals with “Interim measures and
preliminary orders”. Chapter V deals with “Conduct of Arbitral Proceedings”. Chapter VI deals
with “Making of Award and Termination of Proceedings”. Chapter VII deals with “Recourse
Against Award” and Chapter VIII deals with “Recognition and Enforcement of Awards”.
Chapter II of the Model Law which deals with Arbitration Agreement
follow closely Article II of the Convention on the Recognition and Enforcement of Foreign
Arbitration Awards (New York,1958) i.e., the New York convention.17 Article 7,8 and 9
contain the provisions relating to Arbitration Agreement. Article 7 says about “Definition and
Form of Arbitration Agreement”. According to Article 7, an “arbitration agreement” is an
agreement by the parties to submit to arbitration all or certain disputes which have arisen, or
which may arise between them in respect of a defined legal relationship, whether contractual
or not. 18 An arbitration agreement may be in the form of an arbitration clause in a contract or
in the form of a separate agreement.
17
18
UNCITRAL Model Law on International Commercial Arbitration 1985, With amendments as adopted in 2006 -
07-86998_Ebook.pdf; https://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/07-86998_Ebook.pdf; 15
January 2008
25
Article 8 speaks about “Arbitration Agreement and Substantive claim before
Court”. Article 8(1) obliges any Court to refer the parties to arbitration if seized with the claim
on the same subject-matter unless it finds that the arbitration agreement is null and void,
inoperative or incapable of being performed. According to Article 8(2), where an action
referred above has been brought, arbitral proceedings may nevertheless be commenced or
confirmed, and an award may be made, while the issue is pending before the Court. Article 9
of the Model Law expresses that it is not incompatible with an arbitration agreement for a party
to request, before or during arbitral proceedings, from the Court an interim measure of
protection and for a Court to grant such measure.
Chapter III deals with the “Appointment of Arbitrators”. Article 9 states that
the parties are free to determine the number of arbitrators and if they fail to determine the
number of arbitrators, then it shall be three. According to Article 11, the parties are free to
agree on the procedure of appointing the arbitrator or arbitrators. If the parties fail to agree on
a procedure, then each party shall appoint one arbitrator in case of an arbitration with three
arbitrators, and the two arbitrators thus appointed shall appoint the third arbitrator. But if a
party fails to appoint the arbitrator within 30 days of receipt of a request to do so from the other
party, or if the two parties fail to agree on the third arbitrator within 30 days of their
appointment, the appointment shall be made, upon request of a party, by the Court or other
authority specified in Article 6. However, in an arbitration with a sole arbitrator, if the parties
are unable to agree on the arbitrator, he shall be appointed, upon request of a party, by the Court
or other authority specified in Article 6.
Article 12 speaks about the grounds for challenge of an arbitrator. It states that
any person who is approached for appointment as an arbitrator shall disclose any circumstances
likely to give rise to justifiable doubts as to his impartiality or independence. If circumstances
exist that give rise to justifiable doubts as to his impartiality or independence, or he does not
possess the qualifications as agreed by the parties, then the arbitrator may be challenged. The
procedure for challenge is specified in Article 13. It states that the parties are free to agree on
a procedure for challenging an arbitrator. If the parties fail to agree on the procedure, the party
who intends to challenge an arbitrator, shall within 15 days after becoming aware of the
constitution of the arbitral tribunal or after becoming aware of any circumstances referred to in
Article 12(2), send a written statement of the reasons for the challenge to the arbitral tribunal.
The arbitral tribunal shall decide on the challenge unless the challenged arbitrator withdraws
from his office or the other party agrees to the challenge.19
19
26
Chapter IV of the Model Law deals with “Jurisdiction of Arbitral
Tribunal”. Article 16 of the Model Law adopts that the arbitral tribunal may rule on its own
jurisdiction, including any objections with respect to the existence or validity of the arbitration
agreement. For that purpose, an arbitration clause which forms part of a contract shall be treated
as an agreement independent terms of the contract. A decision by the arbitral tribunal that the
contract is null and void shall not entail ipso jure the invalidity of the arbitration clause.
However, a plea that the arbitral tribunal does not have jurisdiction shall be raised not later than
the submission of the statement of the defence. A plea that the arbitral tribunal is exceeding the
scope of its authority shall be raised as soon as the matter alleged to be beyond the scope of its
authority is raised during the arbitral proceedings. The arbitral tribunal may rule on the plea
that the arbitral tribunal is exceeding the scope of its authority either as a preliminary question
or in award on the merits. 20
Chapter IVA deals with “Interim Measures and Preliminary Orders”. Section 1
contain the provisions relating to “Interim Measures” whereas Section 2 contain the provisions
relating to “Preliminary Order”. Section 3 deals with “Provisions applicable to interim
measures and preliminary orders” and Section 4 deals with the “Recognition and Enforcement
of interim measures”. Section 5 contains “Court-ordered interim measures”.
An interim measure is a temporary measure, whether in the form of an
award or in another form, by which, at any time prior to the issuance of the award by which
the dispute is finally decided. The arbitral tribunal orders a party to : (a) maintain or restore a
status quo pending determination of the dispute; (b) take action that would prevent, or refrain
from taking action that is likely to cause, current or imminent harm or prejudice to the arbitral
process itself; (c) provide a means of preserving assets out of which a subsequent award may
be satisfied; or (d) preserve evidence that may be relevant and material to the resolution of the
dispute. The arbitral tribunal may grant interim measures at the request of a party.
However, there are certain conditions that need to be fulfilled for the
arbitral tribunal to grant an interim measure (Article 17A). The party who is requesting for an
interim measure shall satisfy the arbitral tribunal that the harm is not adequately reparable by
an award or damages if the interim measure is not ordered and such harm outweighs the harm
that is likely to result to the party against whom the measure is directed if the measure is
granted. There should also be a reasonable possibility that the requesting party will succeed on
the merits of the claim.
20
27
However, a party may, without notice to any party, make a request for an
interim measure together with an application for a preliminary order directing a party not to
frustrate the purpose of the interim measure requested (Article 17B). The arbitral tribunal may
grant a preliminary order provided it considers that prior disclosure of the request for interim
measure to the party against whom it is directed risks frustrating the purpose of the measure.
The arbitral tribunal shall give notice to all parties of the request for the interim measure, the
application for preliminary order, the preliminary order, if any, immediately after it has made
a determination in respect of an application for a preliminary order (Article 17C).
The arbitral tribunal shall also give an opportunity to any party against whom
a preliminary order is directed to present its case at the earliest practicable time. A preliminary
order shall expire after 20 days from the date on which it was issued by the arbitral tribunal.
The preliminary order shall be binding on the parties but shall not be subject to enforcement
by a Court. Such a preliminary order does not constitute an award. The arbitral tribunal may
suspend, modify or terminate an interim measure or a preliminary order it has granted, upon
the application of any party or on the arbitral tribunal’s own initiative, 21
The arbitral tribunal may require the party requesting an interim
measure to provide appropriate security in connection with the measure. It may require the
party applying for a preliminary order to provide security in connection with the order unless
it considers it inappropriate or unnecessary to do so. It may also require any party promptly to
disclose any material change in the circumstances on the basis of which the measure was
requested or granted. The party who is applying for a preliminary order shall disclose to the
arbitral tribunal all circumstances that are likely to be relevant to the arbitral tribunal’s
determination whether to grant or maintain the order, and such obligation shall continue until
the party against whom the order has been requested has had an opportunity to present its case.
The party shall also be liable for any costs and damages.
The interim measure that has been issued by the arbitral tribunal shall be
recognized and binding. It shall be enforced upon application to the competent Court,
irrespective of the country in which it was issued. The party who is seeking or has obtained
recognition or enforcement of an interim measure shall promptly inform the Court of any
termination, suspension or modification of that interim measure. Article 17I states the grounds
for refusing recognition or enforcement. Recognition or enforcement of an interim measure
may be refused only at the request of a party against whom it is invoked if the Court is satisfied
that : (i) such refusal is warranted on the grounds set forth in Article 36(1)(a)(i), (ii), (iii) or
(iv); or (ii) the arbitral tribunal’s decision with respect to the provision of security in connection
with the interim measure issued by the arbitral tribunal has not been complied with ; or (iv) the
21
28
interim measure has been terminated or suspended by the arbitral tribunal or, where so
empowered, by the Court of the State in which the arbitration takes place or under the law of
which that interim measure was granted.
The recognition or enforcement of an interim measure can also be refused if the
Court finds that : (i) the interim measure is incompatible with the powers conferred upon the
Court unless the Court decides to reformulate the interim measure to the extent necessary to
adapt it to its own powers and procedures for the purpose of enforcing that interim measure
and without modifying its substance; or (ii) any of the grounds set forth in Article 36(1)(b)(i)
or (ii), apply to the recognition and enforcement of the interim measure.
Chapter V of the Model Law states the “Conduct of Arbitral
Proceedings”. Articles 18-27 contain the provisions relating to the conduct of arbitral
proceedings. There should be an equal treatment of parties and the parties should be free to
agree on the procedure to be followed by the arbitral tribunal in conducting the proceedings. If
the parties fail to agree on a procedure, then the arbitral tribunal may conduct the arbitration in
such manner as it considers appropriate. The power that is conferred upon the arbitral tribunal
includes the power to determine the admissibility, relevance, materiality and weight of the
evidence.
Article 20 deals with the “Place of Arbitration”. The parties are free to agree on the place
of arbitration and if the parties fail, then the place of arbitration shall be determined by the
arbitral tribunal. The arbitral tribunal while determining the place of arbitration shall have due
regard to the circumstances of the case, including the convenience of parties. The arbitral
tribunal may meet at any place it considers appropriate for consultation among its members,
for hearing witnesses, experts or the parties, or for inspection of goods, other property or
documents.22
Article 21 states that the arbitral proceedings in respect of a particular dispute
commence on the date on which a request for that dispute to be referred to arbitration is
received by the respondent. The parties are also free to agree on the language or languages to
be used in the arbitral proceedings. If the parties fail, the languages that are to be used in the
proceedings shall be determined by the arbitral tribunal.
It shall be the duty of the claimant to state the facts supporting his claim, the
points at issue and the relief or remedy sought within the period of time agreed by the parties
or determined by the arbitral tribunal (Article 23). The respondent shall also state his defence
in respect of these particulars. The parties may submit with their statements all documents they
22
29
consider to be relevant or may add a reference to the documents or other evidence they will
submit. 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 such
amendment having regard to the delay in making it.
Article 24 deals with “Hearing and written proceedings”. It states that 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 and other
materials. However, unless the parties have agreed that no hearings shall be held, the arbitral
tribunal shall hold such earrings at an appropriate stage of the proceedings, if so requested by
a party. The parties shall be given sufficient advance notice of any hearing and of any meeting
of the arbitral tribunal for the purposes of inspection of goods, other property or documents.
All the statements, documents or other information supplied to the arbitral tribunal by one party
shall be communicated to the other party.
However, if the claimant fails to communicate his statement of claim without
sufficient cause in accordance with Article 23(1), the arbitral tribunal shall terminate the
proceedings. If the respondent fails to communicate his statement of defence without showing
sufficient cause, in accordance with Article 23(1), the arbitral tribunal shall continue the
proceedings without treating such failure in itself as an admission of the claimant’s allegations
(Article 24). However, if any party fails to appear at a hearing or to produce documentary
evidence, the arbitral tribunal may continue the proceedings and make the award on the
evidence before it.
Article 26 states that the arbitral tribunal may appoint one or more experts to report
to it on specific issues to be determined by the arbitral tribunal. The arbitral tribunal may also
require a party to give the expert any relevant information or to produce, or to provide access
to, any relevant documents, goods or other property for his inspection.
Chapter VI deals with “Making of Award and Termination of Proceedings”.
Article 28-33 contain the provisions related to it. Article 28 states that the arbitral tribunal shall
decide the dispute in accordance with such rules of law as are chosen by the parties as
applicable to the substance of the dispute. Any designation of the law or legal system of a given
state shall be construed, unless otherwise expressed, as directly referring to the substantive law
of the state and not to its conflict of law rules. If the parties fail, then the arbitral tribunal shall
apply the law determined by the conflict of laws rules which it considers applicable. The
arbitral tribunal shall decide ex aequo et bono or as amicable compositeur only if the parties
have expressly authorized it to do so.
30
Where there is more than one arbitrator, any decision of the arbitral tribunal shall
be made by a majority of all its members. However, the questions of procedure may be decided
by a presiding arbitrator, if so authorized by the parties or all members of the arbitral tribunal.
Article 30 contains the provisions of “Settlement”. It states that if, during the arbitral
proceedings, the parties settle the dispute, the arbitral tribunal shall terminate the proceedings.
If the parties request to settle the dispute and it is not objected by the arbitral tribunal, it shall
record the settlement in the form of an arbitral award on agreed terms. An award on agreed
terms shall be made in accordance with the provisions of Article 31 and shall state that it is an
award. Such an award has the same status and effect as any other award on the merits of the
case.
The provisions related to the form and contents of award is provided in Article
31. The award shall be made in writing and shall be signed by the arbitrator or arbitrators. In
arbitral proceedings with more than one arbitrator, the signature of the majority of all the
members of the arbitral tribunal shall suffice, provided that the reason for any omitted signature
is stated. The award shall state the reasons upon which it is based and also the date and the
place of arbitration as determined in accordance with Article 20(1). After the award has been
made, a copy signed by the arbitrators in accordance with paragraph 1 of this Article shall be
delivered to each party.
The arbitral proceedings can be terminated by the final award or by an order of the
arbitral tribunal in accordance with paragraph 2 of this Article. The arbitral tribunal shall order
for the termination of the arbitral proceedings under the following conditions:
(i) The claimant withdraws his claim, unless the respondent objects thereto and the
arbitral tribunal recognizes a legitimate interest on his part in obtaining a final
settlement of the dispute;
(ii) The parties agree on the termination of the proceedings;
(iii) The arbitral tribunal finds that the continuation of the proceedings has for any other
reason become unnecessary or impossible;
(iv) The arbitral tribunal finds that the continuation of the proceedings has for any other
reason become unnecessary or impossible.
31
If there are any errors in computation of the award, then a party may with notice to the
other party, may request the arbitral tribunal to correct the award. However, the party shall
request for correction of an order within 30 days of receipt pf award. The error may be a
clerical or typographical error or any error of similar nature (Article 33). 23 A party may
also with notice to the other party, request the arbitral tribunal to give an interpretation of
a specific point or part of the award. If the arbitral tribunal considers the request to be
justified, it shall make the correction or give the interpretation within 30 days of receipt of
the request. The interpretation shall form a part of the award.
Chapter VII deals with “Recourse Against Award”. Article 34 contains the
provisions relating to “Application for setting aside as exclusive recourse against arbitral
award”. Recourse to a Court against an arbitral award may be made only by an application
for setting aside in accordance with paragraphs (2) and (3) of this Article. An arbitral award
may be set aside by the Court specified in Article 6 only if:
(a) The party making the application furnishes proof that:
(i) A party to the arbitration agreement referred to in Article 7 was under some
incapacity, or the said agreement is not valid under the laws to which the parties
have subjected to it or, failing any indication thereon, under the law of this State; or
(ii) 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
(iii) The award deals with a dispute not contemplated by or not falling within the terms
of the submission to arbitration, or 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
award which contains decisions on matters not submitted to arbitration may be set
aside; or
(iv) 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 law from which the parties cannot derogate, or, failing such
agreement, was not in accordance with this Law; or
23
32
(b) The Court finds that :
(i) The subject matter of the dispute is not capable of settlement by arbitration under
the law of this State; or
(ii) The award is in conflict with the public policy of this State.
Chapter VIII deals with “Recognition and Enforcement of Awards”. Article
35 states that an arbitral award, irrespective of the country in which it was made, shall be
recognized as binding and, upon application in writing to the competent Court, shall be
enforced subject to the provisions of this Article and of Article 36.
Article 36 deals with the “grounds for refusing recognition or
enforcement”. Recognition or enforcement of an arbitral award, irrespective of the country
in which it was made, may be refused only at the request of a party against whom it is
invoked, if that party furnishes to the competent Court where recognition or enforcement
is sought proof that :
(i) A party to the arbitration agreement referred to in Article 7 was under some
incapacity, or the said agreement is not valid under the law to which the parties have
subjected it or, failing any indication thereon, under the law of the country where
the award was made; or
(ii) The party against whom the award is invoked 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
(iii) The award deals with a dispute not contemplated by or not falling within the terms
of the submission to arbitration, or it contains decisions on matters beyond the scope
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, the part of the award
which contains decisions on matters submitted to arbitration may be recognized and
enforced; or
(iv) The composition of the arbitral tribunal or the arbitral procedure was not in
accordance 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
(v) The award has not yet become binding on the parties or has been set aside or
suspended by a Court of the country in which, or under the law of which; that award
was made.
An arbitral award may also be refused if the Court finds that :
(i) The subject matter of the dispute is not capable of settlement by arbitration under
the law of this State; or
(ii) The recognition or enforcement of the award would be contrary to the public policy
of this State.
33
UNCITRAL Model Law on International Conciliation24

Conciliation deals with international commercial conciliation. Under this Model Law,
conciliation includes a sole conciliator or two or more conciliators, as the case may be.
Conciliation means a process, whether referred to by the expression conciliation, mediation or
an expression of similar import, whereby parties request a third person or persons (“The
Conciliator”) to assist them in their attempt to reach an amicable settlement of their dispute
arising out of or relating to a contractual or other legal relationship. The conciliation does not
have the authority to impose upon the parties a solution to the dispute.
Article 4 of the Model Law states that a conciliation is international if: (a)
the parties to an agreement to conciliate have, at the time of the conclusion of that agreement,
their places of business in different States; or (b) the State in which the parties have their places
of business is different from either : (i) the State in which a substantial part of the obligations
of the commercial relationship is to be performed; or (ii) the State with which the subject matter
of the dispute is most closely connected.
Place of business
As originally drafted, the place of business was one of the main elements
triggering the application of the Model Law. While drafting the Model Law, the Commission
thought that this approach might be inconsistent with the current practice. It believed that it
would be problematic to use the somewhat artificial idea of the place of conciliation as the
primary basis for triggering the application of the Model Law. The parties often did not
formally designate a place of conciliation and in practical conciliation could occur in several
places. For this purpose, the Model Law does not provide an objective rule for determining the
place of conciliation. Therefore, the issue is left to the agreement of the parties, and if the
parties fail, then to the rules of private international law.
Article 5 states that if a party has more than one place of business, the place
of business is that which has the closest relationship to the agreement to conciliate and if a
party does not have a place of business, reference is to be made to the party’s habitual residence.
24
03-90953_main_pr.qxd - 03-90953_Ebook.pdf; https://www.uncitral.org/pdf/english/texts/arbitration/ml-
conc/03-90953_Ebook.pdf; 04 March 2005
34
Intent of the parties to conciliate
Paragraph 3 of Article 1 provides the definition of conciliation. This definition

takes into account the existence of a dispute, the intention of the parties to reach an amicable
settlement and the participation of an impartial and independent third person or persons that
assists the parties to reach an amicable settlement. In verifying whether in a given factual
situation, the elements set forth in paragraph 3 of Article 1 for the definition of conciliation are
met, courts are invited to consider any evidence of conduct of the parties showing that they
were conscious.
Broad notion of Conciliation
The words “whether referred to by the expression conciliation, mediation, or an

expression of similar import” in paragraph 3 of Article 1 is intended to indicate that the Model
Law applies irrespective of the name given to that process. This is basically to show that there
is no intention to distinguish among procedural styles or approaches to mediation. The
Commission intends that the word “Conciliation” would express a broad notion of a voluntary
process controlled by the parties and conducted with the assistance of a neutral third person or
persons.
International Conciliation
This Model Law applies to international commercial conciliation only and not
private international law as provided in paragraph 4 of Article 1. The requirement of
internationality is met if the parties to the conciliation agreement have their places of business
in different States at the time that the agreement was concluded or where the State in which
either a substantial part of the obligations of the commercial relationship is to be performed or
with which the subject matter of the dispute is most closely connected differs from the State in
which the parties have their place of business.
Opting out of Model Law
35
Paragraph 7 of Article 1 allows parties to exclude the application of the Model Law.
Paragraph 7 comes into existence where the parties to an otherwise domestic conciliation agree
for convenience on a place of conciliation abroad without intending to make the conciliation
“international”.
Interpretation of the Model Law
Article 2 provides guidance for the interpretation of the Model Law by Courts and
other national or local authorities with due regard being given to its international origin. It is
based on Article 7 of the United Nations Convention for the International Sale of Goods,
Article 3 of the UNCITRAL Model Law on Electronic Commerce, Article 8 of the Cross-
Border Insolvency and Article 4 of the UNCITRAL Model Law on Electronic Signatures.
General Principles upon which the Model Law is based
Paragraph 2 of Article 2 states that, where a question is not settled by Model

Law, references may be made to the general principles on which the Model Law is based. The
following non-exhaustive list may be considered, as to the general principles upon which the
Model Law is based :
(a) To promote conciliation as a method of dispute settlement by providing international
harmonized legal solutions to facilitate conciliation that respect the integrity of the
process and promoting active party involvement and party autonomy by the parties;
(b) To promote the uniformity of the law;
(c) To promote frank and open discussions of parties by ensuring confidentiality of the
process, limiting disclosure of certain information and facts raised in the conciliation in
other subsequent proceedings subject only to the need for disclosure required by law or
for the purposes of implementation or enforcement;
(d) To supports developments and changes in the conciliation process arising from
technological developments, such as electronic commerce.
Variation by agreement
36
Article 3 states that the parties may agree to exclude or vary any of the provisions
of this Law. Inclusion of this provision is a reflection of the principle that the whole concept
of conciliation is dependent on the will of the parties. This type of drafting is done to bring
the Model Law more closely in line with other UNCITRAL instruments like Article 6 of
the United Nations Sales Convention, Article 4 of the UNCITRAL Model Law on
Electronic Commerce and Article 5 of the UNCITRAL Model Law on Electronic
Signatures.
Effect of Article 4
Article 4 addresses the question of when a conciliation proceeding can be

understood to have commenced. Article 4 provides that a conciliation commences when
the parties to a dispute agree to engage in such a proceeding. The effect of this provision is
that , even if there exists a provision in a contract requiring parties to engage in conciliation
or a Court or arbitral tribunal directs parties to engage in conciliation proceedings, such
proceedings will not commence until the parties agree to engage in such a proceeding.
Methods by which parties may agree to engage in conciliation
The general reference to the “day on which the parties to the dispute
agree to engage in conciliation proceedings” is designed to cover the different methods by
which parties may agree to engage in conciliation proceedings. Such methods may include,
for example, the acceptance by one party of an invitation to conciliate made by the other
party, or the acceptance by both parties of a direction or suggestion to conciliate made by
a Court, arbitral tribunal or a competent government entity.
Time period for accepting an invitation to conciliate
37
Paragraph 2 provides that a party that has invited another party to engage in
conciliation, may treat this invention as having been rejected if the other party fails to accept
that invitation within 30 days from when the invitation was sent or any other time as
specified in the invitation. The time period is set as per the provision of UNCITRAL
Conciliation Rules.
Default Rule
Unlike in international commercial arbitration where the default rule is often 3

arbitrators, conciliation practice shows that parties usually wish to have the dispute handled
by one conciliator. For that reason, the default rule in Article 5 is one conciliator.
Agreement by the parties on the selection of a conciliator
The intent of Article 5 is to encourage the parties to agree on the selection of a

conciliator. This approach respects the consensual nature of conciliation proceedings and
also provides parties with greater control and therefore confidence in the conciliation
proceedings.
Absence of an agreement by the parties on the selection of a conciliator
When no agreement may be reached on a conciliator, reference may be made to

an institution or a third person. The institution or person may simply provide names of
recommended conciliators or, by agreement of the parties, directly appoint conciliators.
However, the conciliator should be an independent and impartial conciliator.
Disclosure of circumstances likely to create doubts as to the impartiality

of a conciliator
38
A person who is approached as a conciliator should disclose any circumstances
likely to create justifiable doubts as to his or her impartiality or independence.
Agreement by the parties
Paragraph 1, derived from Article 19 of the UNCITRAL Model Law on

International Commercial Arbitration, stresses that the parties are free to agree on the
manner in which the conciliation is to be conducted.
Role of the Conciliator
Paragraph 2, derived from Article7, paragraph 3 of the UNCITRAL

Conciliation Rules, recognizes the role of Conciliator who, while observing the will of the
parties, may shape the process as he or she considers appropriate.
Fair and equal treatment of the parties
Paragraph 3 of Article 6 provides that the conciliator or a panel of conciliators

should seek to maintain fair treatment of the parties by reference to a particular
circumstances of the case. This should be regarded as a basic obligation and a standard to
be observed mandatorily by a conciliator.
Proposal for Settlement
Paragraph 4 of Article 6 states that a conciliator, may at any stage, make a

proposal for settlement. To what extent and at which stage the conciliator may make any
such proposal depends on a variety of factors. The wishes of the parties is taken into
consideration while making such a proposal.
39
Freedom of Communication
Article 7 states that the conciliator may meet or communicate with the parties
together or with each of them separately. But in practice, separate meetings between the
conciliator and the parties takes place. A conciliator is presumed to be free to use this
technique. Some states have also included this provision in their national laws.
Need for open communications between parties and the conciliator
There are certain things that should be kept in mind for a conciliation to
succeed. The parties as well as the conciliator need to understand and explore the issues
between the parties as much as possible as well as the circumstances that give rise to the
issues. The possibilities of the parties to deal with the existing issues and to settle the
dispute should also be taken into consideration. The parties should be ready to deal with
matters that would otherwise not be considered in arbitral or court proceedings, including
the sensitive and confidential matters.
Disclosure of information
Article 8 expresses the principle that, whatever information that a party gives
to a conciliator, that information may be disclosed to the other party, unless the party giving
the information specifically requests otherwise. This provision is in accordance with Article
10 of the UNCITRAL Conciliation Rules. This is important to maintain an open and frank
communication between the parties and the conciliator. A conciliator cultivates a candid exchange
of information regarding the dispute. Such parties boosts the confidence of all parties in the
conciliator. But this principle of disclosure is not absolute. The conciliator has the freedom to
disclose information to the other party but not a duty. If a party requests that an information should
be kept confidential, then the conciliator has a duty not to disclose that information.
Notion of “Information”
40
A broad notion of “information” is provided under this provision . It is intended to
cover all relevant information communicated by a party to the conciliator. The notion of
“information”, as used in this article, should be understood as covering notion
communications that occurred during the conciliation, but also communications that took
place before the actual commencement of the con-ciliation. The words “the substance of
that information”, used in article 8, are along the lines of article 10 of the UNCITRAL
Conciliation Rules.
General Rule regarding Confidentiality
Article 9 states that all information relating to the conciliation proceedings shall be kept
confidential except where disclosure is needed under the law. This provision is in accordance with
Article 14 of the UNCITRAL Conciliation Rules. A provision of confidentiality is very important
because it imposes a sense of confidence amongst the parties.
Party Autonomy
Article 9 is expressly subject to party autonomy to meet concerns expressed that it

might be inappropriate to impose upon the parties a rule hat would not be subject to party
autonomy and could be difficult to enforce. This reinforces one of the main objectives of
the Model Law, which is to respect party autonomy and also to provide a clear rule to guide
parties in the absence of contrary agreement.
General prohibition on the use of information obtained in conciliation for

the purposes of other proceedings
In conciliation proceedings, the parties typically expresses suggestions and

views regarding proposals for a possible settlement, make admissions and their willingness
to state. But if despite these efforts, the conciliation does not result in a settlement and a
party initiates judicial or arbitral proceedings, those views, suggestions, admissions or
indications of willingness to settle might be used to the detriment of the party who made
them.
41
Relationship with Article 20 of the UNCITRAL Conciliation Rules
This provision is essential if the parties have not agreed on a provision such as that
contained in Article 20 of the UNCITRAL Conciliation Rules. Article 20 states that the parties must
not rely on or introduce as evidence or judicial proceedings;
(a) Views expressed or suggestions made by the other party in respect of a possible settlement of
a dispute;
(b) Admissions made by the other party in the course of the conciliation rules;
(c) Proposals made by the conciliator;
(d) The fact that the other party had indicated his willingness to accept a proposal for settlement
made by the conciliator.
Effect of Article 10
Article 10 provides for two results with respect to the admissibility of evidence in other
proceedings; an obligation upon the parties not to rely on the types of evidence specified in Article 10
and an obligation of Courts to treat such evidence as inadmissible. The Model Law aims at
preventing the use of certain information in subsequent judicial or arbitral proceedings,
regardless of whether the parties have agreed to a rule such as that contained in article 20 of
the UNCITRAL Conciliation Rules.
Form of the information or evidence
Paragraph 2 provides that the prohibition in article 10 is intended to apply broadly to the range
of information or evidence listed in paragraph 1,regardless of whether or not such information
or evidence appears in the form of a written document, an oral statement or an electronic
message .Documents prepared solely for purposes of the conciliation proceedings may include
not only statements of the parties but also, for example, witness statements and expert opinions.
Prohibition of disclosure of conciliation-related evidence or information
42
The parties engaged in a conciliation must be able to enter into the conciliation
knowing the scope of the rule and that it will be applied. Paragraph 1 of Article 10 does so by
prohibiting any of the parties involved in the conciliation process, including the conciliator and
any third party, from using conciliation related material in the context of other proceedings.
Under paragraph 3 of Article 10, the Court, Arbitral Tribunal or Government entities are
restricted from ordering disclosure of information referred to in paragraph 1, unless such
disclosure is allowed under the law governing the arbitral or judicial proceedings, and requires
such bodies to treat any such information offered as evidence as being inadmissible.
Situation where disclosure of information is permitted or required by law
If dis-closure of evidence is requested by a party so as to support its position in

litigation or similar proceedings (without there existing overriding public policy interests such
as those referred to below), the court would be barred from issuing a disclosure order. However,
orders by a court (such as dis-closure orders combined with a threat of sanctions, including
criminal sanctions, directed to a party or another person who could give evidence referred to
in paragraph 1), are normally based on legislation, and certain types of such orders (in
particular, if based on the law of criminal procedure or laws protecting public safety or
professional integrity) may be regarded as exceptions to the rule of paragraph 1.
There may be situations where evidence of certain facts would being
admissible under article 10, but the inadmissibility would have to be over-ridden by an
overwhelming need to accommodate compelling reasons of public policy, for example: the
need to disclose threats made by a participant to inflict bodily harm or unlawful loss or damage;
where a participant attempts to use the conciliation to plan or commit a crime; where evidence
is needed to establish or disprove an allegation of professional misconduct based on the conduct
occurring during a conciliation; where evidence is needed in a proceeding in which fraud or
duress is in issue regarding the validity or enforceability of an agreement reached by the par-
ties or where statements made during a conciliation show a significant threat to public health
or safety. The final sentence in paragraph 3 expresses such exceptions in a general manner and
is in terms similar to the exception expressed with respect to the duty of confidentiality in
article 9.
43
Relationship between conciliation and subsequent proceedings
This provision eliminates the possibility of avoiding the application of article

9 by introducing evidence in proceedings where the main issue is a different one from the issue
considered in conciliation. In making sure that certain information is not used in subsequent
proceedings, it must be borne in mind that parties in practice often present in conciliation
proceedings information or evidence that has existed or has been created for purposes other
than the conciliation and that, by presenting it in the conciliation proceedings, the party has not
forfeited its use in subsequent proceedings or otherwise made it inadmissible. In order to put
this beyond doubt, paragraph 5 makes it clear that all information that other-wise would be
admissible as evidence in a subsequent court or arbitral proceeding does not become
inadmissible solely by reason of it having been raised in an earlier conciliation proceeding (for
example, in a dispute concerning a contract of carriage of goods by sea, a bill of lading would
be admissible to prove the name of the shipper, notwithstanding its prior use in a conciliation).
Only statements (or views, proposals etc.) made in con-ciliation proceedings, as listed in
paragraph 1, are inadmissible, but the inadmissibility does not extend to any underlying
evidence that may have given rise to those statements.
Circumstances in which conciliation may be terminated
The provision enumerates various circumstances in which conciliation

proceedings may be terminated. In subparagraph (a)the provision uses the expression
“conclusion” instead of “signing” in order to better reflect the possibility of entering into a
settlement in a form other than a signed document, such as by an exchange of electronic
communications or even orally. The first circumstance listed in sub paragraph(a)is where the
conciliation ends successfully, namely where a settlement agreement is reached. The second
circumstance set out in subparagraph(b)allows the conciliator or panel of conciliators to bring
the conciliation proceedings to an end, after consulting with the parties. In the preparation of
the Model Law, it was agreed that subparagraph (b)should also cover cases of abandonment
of the con-ciliation procedure after it had commenced where such abandonment is implied by
the conduct of the parties, for example conduct such as an48UNCITRAL Model Law on
International Commercial Conciliations with Guide to Enactment.
44
expression of a negative opinion by a party about the prospects of the con-ciliation, or refusal
of a party to consult or to meet with the conciliator when invited. The phrase “after consultation
with the parties” should be interpreted to include those cases where the conciliator has
contacted the parties in an attempt to consult and has received no response. Sub paragraph(c)
provides that both parties may declare the conciliation proceedings to be terminated, and
subparagraph (d)allows one party to give such notice of termination to the other party and the
conciliator or panel of conciliators.
Form of termination
While article 11 does not require that the termination be in writing, an enacting State
that adopts draft article X as contained in the footnote to article 4 may wish to consider whether
termination in writing should be required, since precision may be needed in determining when
a conciliation ended so that courts can properly determine the moment when the limitation
period resumes running.
Default rule, subject to party autonomy
While, in some legal systems, conciliators are permitted to act as arbitrators if

parties so agree and, in other legal systems, that is subject to rules in the nature of codes of
conduct, the Model Law is essentially neutral on that point, providing a default rule subject to
party autonomy. In any event, the agreement of the parties and the conciliator may be able to
override any limitation on that point, even where the matter is subject to rules in the nature of
codes of conduct.39Article 12 reinforces the effect of article 10 by limiting the possibility of
the conciliator acting as arbitrator in respect of a dispute that was or is the subject of the
conciliation proceedings or in respect of another dispute that has arisen from the same
contractor any related contract. The purpose of article 12 is to provide greater confidence in
the conciliator and in conciliation as a method of dispute settlement. A party may be reluctant
to strive actively for a settlement in conciliation proceedings if it has to take into account the
possibility that, if the conciliation is not successful, the conciliator might be appointed by the
other party as an arbitrator in subsequent arbitration proceedings.
45
Scope of article 12
The provision applies not only with respect to “a dispute that was or is the subject
of the conciliation proceedings” but also “in respect of another dispute that has arisen from the
same contract or legal relationship or any related contract or legal relationship”. The first limb
extends the application of the provision to both past and ongoing conciliations. The second
limb extends the scope of the article to cover disputes arising under contracts that are distinct
but commercially and factually closely related to the subject matter of the conciliation. While
the formulation is very broad, determining whether a dispute raises issues relating to the main
contract or legal relationship would require an examination of the facts of each case). In the
preparation of the Model Law, it was agreed that the reference to “another dispute” in article
12 could involve parties other than the parties in the conciliation proceedings.
Arbitrator acting as conciliator
An early draft of the Model Law contained a provision dealing with the
situation where an arbitrator acts as a conciliator, a practice that is per-mitted in some legal
systems. It was noted that such a provision would relate to the functions and competence of an
arbitrator and to arbitration practices that differ from country to country and are influenced by
legal and social traditions. There is no settled practice on the question of an arbitrator acting as
conciliator, and some practice notes suggest that the arbitrator should exercise caution before
suggesting or taking part in con-ciliation proceedings relating to the dispute. It was considered
inappropriate to attempt unifying these practices through uniform legislation.
Conciliator acting as representative or counsel of a party
An early draft of the Model Law also restricted a conciliator from acting as
representative or counsel of either party subject to contrary party agreement. It was suggested,
however, that, in some jurisdictions, even if the parties agreed to the conciliator acting as a
representative or counsel of any party, such an agreement would contravene ethical guidance
to be followed by conciliators and could also be perceived as undermining the integrity of
46
conciliation as a method for dispute settlement. A proposal to amend the provision so as not
to leave this question to party autonomy was rejected on the basis that it undermined the
principle of party autonomy and failed to recognize that, in some jurisdictions where ethical
rules required a conciliator not to act as representative or counsel, the conciliator would always
be free to refuse to act in that capacity. On that basis, it was agreed that the provision should
be silent on the question whether a conciliator could act as representative or counsel of any of
the parties.
Reasons for expedited enforcement
Many practitioners have put forward the view that the attractiveness of
conciliation would be increased if a settlement reached during a con-ciliation would enjoy a
regime of expedited enforcement or would, for the purposes of enforcement, be treated as or
similarly to an arbitral award.
Issue of enforcement of a settlement agreement left to domestic law
The text of the article reflects the smallest common denominator between the
various legal systems. In the preparation of the Model Law, the Commission was generally in
agreement with the general policy that easy and fast enforcement of settlement agreements
should be promoted .However, it was realized that methods for achieving such expedited
enforcement varied greatly between legal systems and were dependent upon the technicalities
of domestic procedural law, which do not easily lend themselves to harmonization by way of
uniform legislation. Article 14 thus leaves issues of enforcement, defences to enforcement and
designation of courts (or other authorities from whom enforcement of a settlement agreement
might be sought) to applicable domestic law48or to provisions to be formulated in the
legislation enacting the Model Law. In finalizing this article, the Commission noted that the
purpose of the Model Law was not to discourage laws of the enacting State from imposing
form requirement such as a requirement for signature or written form where such a requirement
was considered essential.49Various examples of treatment of the issue of expedited
enforcement of settlement agreements in domestic legislation are outlined below, with a view
to facilitating consideration of possible options by legislators enacting the Model Law.
47
Contractual nature of a settlement agreement in some States
Some States have no special provisions on the enforceability of such settlements,

with the result that they would be enforceable as any contrac tbetween the parties. This
understanding that conciliation settlements were enforceable as contracts has been restated in
some laws on conciliation.
“Conclude an agreement”
Any enacting State that has not enacted the UNCITRAL Model Law on Electronic
Commerce should consider inclusion of a provision along the lines of articles 6 and 7 of that
instrument57when enacting this Model Law (A/CN.9/506, para. 88) in order to remove
obstacles to the increased use of electronic communications in international commercial
conciliation.
UNCITRAL Conciliation Rules 25
These rules apply to conciliation of disputes arising out of or relating to a

contractual or other legal relationship where the parties seeking an amicable settlement of
dispute have agreed that the UNCITRAL Conciliation Rules apply. But the parties may choose
to exclude these Rules at any time. If there is a dispute between these Rules and a provision of
law from which the parties cannot derogate, that provision prevails. Article 2 of these
Conciliation Rules state that the party who wants to initiate conciliation proceedings sends to
the other party a written invitation to conciliate under these Rules, briefly identifying the
subject of the dispute. The conciliation proceedings commence from the time the other party
accepts the invitation to conciliate. It is preferred that the confirmation be in writing. However,
there will be no conciliation proceedings if the other party rejects the invitation. The party who
sends the invitation may treat an invitation to be rejected if he does not receive a reply within
30 days from the date on which he sends the invitation.
25
unsaved:///newpage2.htm - conc-rules-e.pdf; https://www.uncitral.org/pdf/english/texts/arbitration/conc-
rules/conc-rules-e.pdf; 10 June 2005
48
Article 3 states that the number of conciliators shall be one unless the parties
agree that there shall be two or three conciliators. The arbitrators shall act jointly where there
are more than one arbitrator. Where there is only one conciliator, the parties shall freely choose
on the name of a sole conciliator. But if there are two conciliators, each party appoints one
conciliator and where there are three conciliators, each party appoints one conciliator and then
the parties shall choose the third arbitrator. The parties may also take the help of an appropriate
institution or person with respect to the appointment of conciliators. The parties may request
such institutions to recommend the names of suitable individuals to act as conciliator or the
parties may agree that the appointment of one or more conciliators be made directly by such
an institution or person.
While appointing such conciliators, regard should be given to such
considerations as are likely to secure the appointment of an independent and impartial
conciliator. For a sole or third conciliator, due consideration should be given to the advisability
of appointing a conciliator of a nationality other than the nationalities of the party.
Article 5 states that after the conciliator is appointed, he shall request each party
to submit to him a brief written statement describing the general nature of the dispute and the
points at issue. Each party sends a copy of the statement to the other party. The conciliator may
also request each party to submit to him a further written statement of his position and the facts
and grounds in support thereof, supplemented by any documents and other evidence that such
party deems appropriate. The party sends a copy of his statement to the other party.
The parties can choose any person to represent or assist them (Article 6). The
names and addresses of such persons are to be communicated in writing to the other party and
to the conciliator. The communication shall state whether the appointment is made for purposes
of representation or of assistance. Article 7 states that it is the duty of the conciliator to assist
the parties in an independent and impartial manner to reach an amicable settlement of their
dispute. The conciliator is guided by the principles of objectivity, fairness and justice. He shall
give consideration to the rights and obligations of the parties, the usages of the trade concerned
and the circumstances surrounding the dispute, including any previous business practices
between the parties.
The Indian Arbitration and Conciliation Act,199626
26
Prelims.pmd - file.php; http://icadr.nic.in/file.php?123?12:1461580854; 27 May 2019
49
Part I of the Arbitration and Conciliation Act,1996 deals with
“Arbitration.” Part II deals with “Enforcement of certain Foreign Awards”. Part III deals with
“Conciliation” and Part IV deals with “Supplementary Provisions”. Arbitration is defined in
Part I of the Act as any arbitration whether or not administered by permanent arbitral institution
(Section 2(a)). Section 2(f) of the Act defines international commercial arbitration as “an
arbitration relating to disputes arising out of legal relationships, whether contractual or not,
considered as commercial 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 habitual resident in, any country other than India; or
(ii) a body corporate which is in corporate in any country other than India; or (iii) the 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.
Section 2 of the Act states that this Part is applicable only where the place of
arbitration is in India. An arbitral award made under this Part is considered as a domestic award
(Section 2(7)).
Chapter II deals with “Arbitration Agreement”. An arbitration agreement can be in
two ways : either by way of arbitration clause in a contract or by a separate agreement. An
arbitration agreement shall always be in writing. An arbitration agreement is considered to be
in writing if it fulfils certain conditions. It should be contained in a document signed by the
parties. It should also be contained in an exchange of letters, telex, telegrams or other means
of telecommunication which provide a record of the agreement and also in an exchange of
statements of claim and defence in which the existence of the agreement is alleged by one party
and not denied by the other (Section 7)
The judicial authority has a right to refer the parties to arbitration before
which the action is brought. For that purpose, the party shall make an application regarding the
subject matter of the arbitration agreement. Such application shall not be entertained unless it
is accompanied by the original arbitration agreement or a duly certified copy. However, when
the issue is pending before the judicial authority, an arbitration may be commenced or
continued an arbitral award can be made (Section 8).
Section 9 deals with interim measures by Court. It states that a party may
apply to a Court for an interim measure of protection in respect of certain matters. An
application for interim measure can be made at any time, 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. An application for interim measure can be made in respect of the following
50
matters : (i) the preservation, interim custody or sale of any goods, which are the subject matter
of the arbitration agreement; (ii) securing the amount in dispute in the arbitration; (iii) 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 authorizing for any of
the aforesaid purposes any person to enter upon any land or building in the possession of any
party, or authorizing 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 information or
evidence; (iv) interim injunction or the appointment of a receiver; (v) such other interim
measure of protection as may appear to the Court to be just and convenient.
Chapter III of the Act deals with “Composition of Arbitral Tribunal”.
Section 10 states that the parties can determine any number of arbitrators. But if the parties fail
to determine the number of arbitrators, it shall consist of sole arbitrator. The number of
arbitrators shall not be an even number. Section 11 states that a person of any Nationality can
be an arbitrator. The parties are free to agree on the procedure for appointment of an arbitrator.
However, if the parties fail, then in an arbitration with three arbitrators, each party shall appoint
one arbitrator. The two appointed arbitrators shall appoint the third arbitrator. In that case, the
third arbitrator shall be the presiding arbitrator. However while appointing the two arbitrators,
if a party fails to appoint an arbitrator within 30 days from receipt of request or the two
appointed arbitrators fail to agree on the third arbitrator within 30 days of the date of
appointment, the appointment shall be made by the Chief Justice or any person or institution
designated by him, upon request of a party.
However, in case of a sole arbitrator, if the parties fail to agree on the arbitrator
within 30 days from receipt of a request by one party from the other party to so agree the
appointment shall be made, upon request of a party, by the Chief Justice or any person or
institution designated by him.
In case an appointment procedure is agreed upon by parties and a party fails to act
as required under that procedure; or the parties, or the two appointed arbitrators, fail to reach
an agreement expected of them under that procedure; or a person including an institution, fails
to perform any function entrusted to him or it under that procedure, then a party may request
the Chief Justice or any person or institution designated by him to take necessary measure. The
decision by the Chief justice or the person or institution designated by him is final. The
Arbitrator appointed shall be duly qualified for being an arbitrator. He shall be an independent
as well as an impartial arbitrator.
51
Section 12 states the “Grounds for challenge”. The person who is approached for
appointment of an arbitrator shall disclose in writing any circumstances that is likely to give
justifiable doubts as to his independence or impartiality. An arbitrator can be challenged only
if there are circumstances that give rise to justifiable doubts as to his independence or
impartiality. However, a party may challenge an arbitrator appointed by him only if he becomes
aware of the reasons after the appointment has been made.
Section 13 states about the “Challenge Procedure”. The parties are free to agree
on the procedure for challenging an arbitrator. If the parties fail, then the party who wants to
challenge an arbitrator, shall within 15 days after becoming aware of the constitution of arbitral
tribunal, send a written statement of the reasons for the challenge to the arbitral tribunal. The
arbitral tribunal shall decide on the challenge unless the arbitrator withdraws from his office or
the other party agrees to the challenge. However, if the challenge procedure is not successful,
the arbitral tribunal shall continue the arbitral proceedings and make an arbitral award. After
the arbitral award is made, the party who has challenged the arbitrator may make an application
for setting aside such an arbitral award in accordance with Section 34. After setting aside of
the arbitral award, the Court may decide as to whether the arbitrator who is challenged is
entitled to any fees.
Chapter IV deals with “Jurisdiction of Arbitral Tribunal”. The arbitral tribunal
may rule on its own jurisdiction. For this purpose, an arbitration clause which forms part of a
contract shall be treated as an agreement independent of the other terms of the contract. A
decision by the arbitral tribunal that the contract is null and void shall not entail ipso jure the
invalidity of the arbitration clause. However, a plea that the arbitral tribunal shall be raised not
later than the submission of the statement of defence. A plea that the arbitral tribunal is
exceeding the scope of its authority shall be raised as soon as the matter alleged to be beyond
the scope of its authority is raised during the arbitral proceedings. The arbitral tribunal at the
request of a party order a party to take any interim measure of protection as the arbitral tribunal
may consider it necessary in respect of the subject matter of the dispute.
Chapter V deals with “Conduct of Arbitral Proceedings”. Section 18 states that
the parties should be given equal treatment. Each party shall have a full opportunity to present
his case. The arbitral tribunal may not be bound by the Code of Civil Procedure, 1908 or the
52
Indian Evidence Act, 1872. The parties agree on the procedure to be followed by the arbitral
tribunal while conducting arbitral proceedings. If the parties fail, then the arbitral tribunal may
conduct the proceedings in a manner it considers appropriate. The power of the arbitral tribunal
includes the power to determine the admissibility, relevance, materiality and weight of any
evidence.
The parties can also freely choose their place of arbitration. But if the parties fail,
then the arbitral tribunal decides the place of arbitration looking into the circumstances of the
case and the convenience of the parties. The arbitral tribunal may meet at any place it considers
appropriate. It may meet for consultation or for hearing witnesses, experts or the parties, or for
inspection of goods, other property or documents. The parties can choose any language they
want. But if the parties fail to choose a language, then the arbitral tribunal shall determine
which language shall be used.
The claimant shall state the facts supporting his claim, the points at issue
and the relief or remedy sought within a period of time agreed upon by the parties or determined
by the arbitral tribunal. The respondent shall state his defence in respect of these particulars.
All relevant documents should be submitted by the parties. Either party may amend or
supplement his claim of defence during the course of the arbitral proceedings.
It is on the arbitral tribunal to decide whether to hold oral hearings or whether
the proceedings shall be conducted on the basis of documents and other materials. The oral
hearing must be held at an appropriate state of the proceedings by the arbitral tribunal on a
request of a party. Sufficient advance notice should be given to the parties of any hearing. If
without showing sufficient cause, the claimant fails to communicate his statement of claim or
the respondent fails to communicate his statement of defence, the arbitral tribunal shall
terminate the proceedings. If a party fails to appear at an oral hearing or to produce
documentary evidence, the arbitral tribunal may continue the proceedings and make the arbitral
award on the evidence before it.
Chapter VII of the Act deals with “Making of Award and Termination of
Proceedings”. Section 28 states that where the place of arbitration is in India, the dispute shall
be decided by the arbitral tribunal in accordance with the substantive law for the time being in
force in India. However, this does not apply to international commercial arbitration. In case of
international commercial arbitration, the rules for deciding the dispute are slightly different.
53
The dispute shall be decided in accordance with the rules of law designated by the parties which
is applicable to the substance of the dispute. In an arbitral proceeding with more than one
arbitrator, any decision of the arbitral tribunal shall be made by a majority of all its members.
Section 30 states that the arbitral tribunal may use mediation, conciliation or
other procedures at any time when the arbitral proceedings are going on to encourage
settlement. The arbitral tribunal shall terminate the proceedings if the parties settle the dispute
during arbitral proceedings. It shall also record the settlement in the form of an arbitral award
if the parties request so and the arbitral tribunal does not object. The arbitral award shall be
made in accordance with Section 31 and state that it is an arbitral award.
The arbitral award shall be made in writing and signed by members of the arbitral
tribunal. Where there are more than one arbitrator, the signatures of the majority of all the
members of the arbitral tribunal shall be sufficient. The award shall also state the reasons upon
which it is based. It should state that the date and place of arbitration is made in accordance
with Section 20. A signed copy should be delivered to each party after the award is made. An
interim arbitral award can be made by the arbitral tribunal while the proceedings are going on.
It can be made on any matter with respect to which it may make a final arbitral award. The
arbitral award is terminated by the final arbitral award. Termination for arbitral proceedings is
issued by the arbitral tribunal when the claimant withdraws his claim and the arbitral tribunal
is satisfied that he has a legitimate interest in that. Arbitral proceedings can also be terminated
if the parties agree to do so or the arbitral tribunal thinks that it has become unnecessary or
impossible to continue the proceedings.
Chapter VII deals with “Recourse against Award”. Article 34 states that an
arbitral award may be set aside by the Court only if the party who has made the application
shows that a party was under some incapacity or the arbitration agreement is not valid under
the law to which the parties have subjected it or he was not given proper notice for the
appointment of an arbitrator and he was not able to present his case or the arbitral award deals
with a dispute not contemplated by or not falling within the terms of the submission to
arbitration or the composition of the arbitral tribunal or the arbitral procedure was not in
accordance with the agreement of the parties. An arbitral award may also be set aside by the
Court if it finds that the subject-matter of the dispute is not capable of settlement by arbitration
under the law for the time being in force or the arbitral award is in conflict with the public
54
policy of India.
Chapter VIII of the Act deals with “Finality and Enforcement of Arbitral Awards”.
Section 35 states that the arbitral award is final and binding on the parties and persons, claiming
under them respectively. Section 36 states that an award shall be enforced under the Code of
Civil Procedure, 1908, if the time to make an application to set aside the award under Section
34 has expired or the application has been refused after it has been made.
Chapter XI deals with “Appeals”. Article 37 states that an appeal shall lie to the
Court who has the authority to hear appeals. An appeal shall lie from an original decree of a
Court passing the order. An appeal shall lie from the following orders : (i) Granting or refusing
to grant any measure under Section 9 or (ii) Setting aside or refusing to set aside an arbitral
award under Section 34. However, second appeal shall not lie from an order passed in appeal
under this section. But it shall not affect or take away any right to appeal to the Supreme Court.
Chapter X deals with “Miscellaneous Provisions”. It states the arbitral tribunal may
fix the amount of the deposit or supplementary deposit which it thinks is necessary in respect
of the claim submitted to it. The arbitral tribunal shall have a lien on the arbitral award for any
unpaid costs of the arbitration.
Part II of the Arbitration and Conciliation Act,1996 deals with “Enforcement
of certain Foreign Awards”. Chapter 1 deals with “New York Convention Awards” whereas
Chapter II deals with “Geneva Convention Awards”. Under the New York Convention Awards,
a foreign award means an arbitral award on differences between persons arising out of legal
relationships, whether contractual or not, considered as commercial under the law in force in
India, made on or after 11th October,1960 in pursuance of an agreement in writing for
arbitration to which the Convention set forth in the First Schedule applies, and 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 to which the said
Convention applies (Section 44).
Section 44 states about the power of judicial authority to refer parties to arbitration.
When a judicial authority is seized of an action in respect of a matter in which the parties have
made an agreement referred to in Section 44, shall refer the parties to arbitration if the parties
request so to do. But it cannot refer the parties to arbitration if it finds that the said agreement
55
is null and void, inoperative or incapable of being performed. A foreign award enforceable
under this Chapter is binding on the persons between whom it was made. It is accordingly
relied on by any of those persons by way of defence. A foreign award may be set aside in any
legal proceedings in India.
Section 47 of the Act states that the party who is applying for the enforcement of a
foreign award shall produce before the Court certain documents while filing the application.
The documents that need to be produced before the Court are : (i) The original award or a copy,
duly authenticated in the manner required by law of the country in which it was made; (ii) The
original agreement for arbitration or a duly certified copy and (iii) Such evidence as may be
necessary to prove that the award is a foreign award. If it is in a foreign language, then the party
seeking to enforce the award shall produce a translation into English certified as correct by a
diplomatic or consular agent of the country to which that party belongs or certified as correct
in such other manner as may be sufficient according to the law in force in India.
Section 48 provides the conditions for enforcement of foreign awards.
Enforcement of a foreign award can be refused at the request of a party against whom it is
invoked if the party shows proof that the parties were under some incapacity or the said
agreement is not valid under the law to which the parties have subjected it or the party was not
given proper notice and therefore he is unable to present his case or the award deals with a
difference not contemplated by or not falling within the terms of the submission to arbitration
or the composition of the arbitral tribunal is not in accordance with the agreement of the parties
or the award is not yet binding on the parties, or has been set aside or suspended by a competent
authority of the country in which, or under the law of which it was made. Enforcement of an
arbitral award can also be refused if the Court finds that the subject-matter of the difference is
not capable of settlement by arbitration under the law of India or the enforcement of the award
would be contrary to the public policy of India.
Section 49 states that a foreign award shall be deemed to be a decree of the Court
in which it was made. Section 50 states that an appeal shall lie from an order refusing to refer
the parties to arbitration under Section 45 and enforce a foreign award under Section 48, to the
Court authorized by law to hear appeals from such order. However, no second appeal shall lie
from an order passed in appeal under this Section. But it shall not affect or take away any right
to appeal to the Supreme Court. Section 52 states that Chapter II of this Part i.e. the Geneva
Convention Awards does not apply in relation to foreign awards to which the Chapter applies.
56
Chapter II of this Part deals with Geneva Convention Awards. Under this
chapter, a foreign award is defined as an arbitral award on differences relating to matters
considered as commercial under the law in force in India made after 28th July,1924 : (a) in
pursuance of an agreement for arbitration to which the Protocol set forth in the Second
Schedule applies; (b) between persons of whom one is subject to the jurisdiction of some of
such powers as the Central Government, 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 whom the other is subject to the jurisdiction of some other
of the powers aforesaid, and (c) in one of such territories as the Central Government, 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 final if any proceedings for the purpose of contesting the validity of
the award are pending in the country in which it was made.
Section 55 states that a foreign award enforceable under this Chapter is
treated as binding for all purposes on the persons as between whom it was made. The award is
relied on by any of those persons by way of defence. It can be set off by any legal proceedings
in India. Section 56 states that the party who is applying for enforcement of a foreign award
shall produce certain documents before the Court as evidence while filing the application. The
original award or a copy duly authenticated in the manner required by the law of the country
in which it was made should be submitted before the Court. An evidence proving that the award
is final as well as any other evidence that is necessary should be submitted. If any document is
in foreign language, the party seeking to enforce the award shall produce a translation into
English certified as correct by a consular or diplomatic agent of the country to which that party
belongs or certified as correct in such other manner as may be sufficient according to the law
in force in India.
Section 57 states the conditions for enforcement of foreign awards. It states that for
a foreign award to be enforceable, it is necessary that the award has been made in pursuance of
a submission to arbitration, which is valid under the law applicable or the subject matter of the
award is capable of settlement by arbitration under the law of India or the award has been made
57
by arbitral tribunal provided for in the submission to arbitration or constituted in the manner
agreed upon by the parties and in conformity with the law governing the arbitration procedure
or the award has become final in the country in which it has been made or the enforcement of
the award is not contrary to public policy or the law of India.
A foreign award is deemed to be a decree of the Court. An appeal
shall lie from the order refusing to refer the parties to arbitration under Section 54 and to
enforce a foreign award under Section 57. Second appeal does not lie from an order. But it does
not affect or take away any right to appeal to the Supreme Court.
Conciliation is contained in Part III of the Arbitration and Conciliation Act,
1996. Section 61 of the Act states that this part shall apply to conciliation of disputes arising
out of legal relationship, whether contractual or not and to all proceedings relating thereto. The
party who wants to initiate conciliation shall send to the other party a written invitation to
conciliate. It should briefly identify the subject of the dispute. The proceedings commence
when the other party accepts in writing the invitation to conciliate. But if the other party rejects
the invitation, there will be no conciliation. A party may also treat as rejected an invitation to
conciliate, if he does not receive a reply within 30 days from the date on which he sends the
invitation. And if he does so, he shall have to inform that to the other party.
Section 63 states that the number of conciliators should be one unless the
parties agree that there should be two or three conciliators. If there is more than one conciliator,
then they should act jointly, as a general rule. Where there is only one conciliator, the parties
may agree on the name of a sole conciliator. Where there are two conciliators, each party may
appoint one conciliator. And in a conciliation proceeding with three conciliators, each party
appoints one conciliator and then the two parties choose the third conciliator who shall act as
the presiding conciliator. Parties may enlist the assistance of a suitable institution or person in
connection with the appointment of conciliators. A party may request such an institution or
person to recommend the names of suitable individuals to act as conciliator or the parties may
agree that the appointment of one or more conciliators be made directly by such an institution
or person. The institution or the person shall have due regard to the such considerations as are
likely to secure the appointment of an individual and impartial conciliator.
58
Once the conciliator is appointed, he may request each party to submit to him
a brief statement describing the general nature of the dispute and the points at issue. Each party
shall send a copy of such statement to the other party. The conciliator may also request each
party to submit a further written statement of his position and the facts and grounds in support,
supplemented by any documents and other evidence that such party deems appropriate. The
party shall send a copy of such statement, documents and other evidence to the other party. At
any stage of the conciliation proceedings, the conciliator may request a party to submit to him
such additional information, as he deems appropriate.
The conciliator is not bound by the Code of Civil Procedure, 1908 or the Indian
Evidence Act,1872 (Section 67). The conciliator should act in an independent and impartial
manner for reaching an amicable settlement of the dispute. He should be guided by the
principles of objectivity, fairness and justice, giving consideration to, among other things, the
rights and obligations of the parties, the usages of the trade concerned and the circumstances
surrounding the dispute, including any previous business practices between the parties. The
conciliator conducts the proceedings in a manner that he considers appropriate and while doing
so, he should look into the circumstances of the case. The conciliator may hear oral statement
if a party requests so.
During the course 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. The conciliator may invite the parties to meet him or communicate with the parties
together or with each of them separately. The place where the meetings are to be held are
determined by the conciliator unless the parties have agreed upon the place where the meetings
are to be held. The place determined by the conciliator should be decided only after consultation
with the parties and looking into the circumstances of the conciliation proceedings. If the
conciliator receives any factual information from one party, then he has to convey that to the
other party so that the other party may have the opportunity to present any explanation, which
he considers appropriate. But if a party requests that the information should be kept
confidential, then he should not disclose that information to the other party.
Section 71 of the Act states that the parties should co-operate with the
conciliator in a good faith. He shall endeavor to comply with requests by the conciliator to
submit written materials, provide attendance and attend meetings. The parties are free to
provide suggestions for the settlement of the dispute either on his own initiative or at the
invitation of the conciliator.
59
Section 73 states that if the conciliator feels that there exists elements of a settlement,
which may be acceptable to the parties, he shall formulate the terms of a possible settlement
and submit them to the parties for their observations. After receiving the observations of the
parties, the conciliator may reformulate the terms of a possible settlement in the light of such
observations. If the parties reach an agreement on a settlement of the dispute, they may draw
up and sign a written settlement agreement. If the parties sign the settlement agreement, it shall
be final and binding on the parties and persons claiming under them respectively. The
conciliator shall authenticate the settlement agreement and furnish a copy thereof to each of
the parties.
Section 76 of the Act deals with “Termination of Conciliation Proceedings”. The
conciliator proceedings shall be terminated by the signing of the settlement agreement by the
parties on the date of the agreement or a written declaration of the conciliator, after consultation
with the parties, to the effect that further efforts at conciliation are no longer justified, on the
date of the declaration. Or by a written declaration of the parties addressed to the conciliator to
the effect that the conciliation proceedings are terminated, on the date of the declaration or by
a written declaration of a party to the other party and the conciliator, if appointed, to the effect
that the conciliation proceedings are terminated, on the date of the declaration.
After the termination of the conciliation proceedings, the conciliator shall fix the
costs of the conciliation and give a written notice thereof to the parties (Section 78). Costs
means reasonable costs relating to (a) the fee and expenses of the conciliator and witnesses
requested by the conciliator with the consent of the parties; (b) any expert advice requested by
the conciliator with the consent of the parties; (c) any assistance provided pursuant to clause
(b) of Section 64 and 68 and (d) any other expenses incurred in connection with the conciliation
proceedings and the settlement agreement.
The conciliator may direct each party to deposit an equal amount as an advance for
the costs referred to in sub-section (2) of Section 78 which he expects will be incurred. The
conciliator may also direct a supplementary deposit in an equal amount from each party during
the course of the conciliation proceedings. If the party does not pay in full within 30 days, 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. On termination of the
conciliation proceedings, the conciliator shall render an accounting to the parties of the deposits
received and shall return any unexpected balance to the parties.
60
Chapter III
JUDICIAL ANALYSIS
61
JUDICIAL ANALYSIS
The Indian Arbitration and Conciliation Act, 1996 is based on the

UNCITRAL Model Law on International Commercial Arbitration. The General Assembly of
the UN adopted the UNCITRAL Model Law in 1985. The General Assembly recommended
that all countries should give due consideration to the UNCITRAL Model Law on International
Commercial Arbitration while enacting legislations both in domestic and international
arbitrations. Since India is a member of the UNCITRAL, therefore the new act of Arbitration
i.e, the Arbitration and Conciliation Act, 1996 which repealed the Arbitration Act, 1940 is
based on the UNCITRAL Model Law on International Commercial Arbitration. We can see in
a number of cases in India where the Judge while giving his judgement has given due
consideration to the UNCITRAL Model Law. Some of the cases are mentioned below.
Gas Authority of India v M/S Keti Constructions (I) Ltd.27
For this situation, the educated Judge has plainly referenced that the
Arbitration and Conciliation Act,1996 is on same lines as the UNCITRAL Model Law on
International Commercial Arbitration which was drafted by the UNCITRAL. It has likewise
alluded the case, "Sundaram Finance Ltd v NEPC Ltd", where it was seen that arrangements
of Arbitration and Conciliation Act, 1996 ought to be translated remembering the Model Law.
For this situation, GAIL granted 4 contracts for its task at Petro-compound complex, Dibiyapur,
District Etawah to M/s Keti Constructions (I) Ltd. The litigant for this situation is GAIL and
the respondent is Keti Constructions. The agreement had an intervention condition. . Appealing
party No.1 alluded the question for mediation to Justice N.N Goswami who gave a "no case
grant". Respondent No.1 documented an appeal under Section 34 of the Act in the Delhi High
Court for putting aside the honor. The Learned single Judge rejected the equivalent. At that
27
M/S. Gas Authority Of India Ltd. ... vs M/S. Keti Construction (I) Ltd. ... on 11 May, 2007;
https://indiankanoon.org/doc/1507906/; 27 May 2019
62
point the Respondent No.1 favored an intrigue before the Division Bench of the High Court
under Section 37 of the Act which permitted the equivalent and put aside the request. It was
additionally coordinated in the request that the gatherings will show up before Brig. Nardip
Singh who has been assigned as authority by Respondent No.1 (temporary worker) and he will
continue as per law and give the honor.
The standard ground on which the request under Section 34 of the Act had been
documented by respondent no.1 was that it had conjured the assertion provision by sending a
notice to appealing party no.1. The litigant no.1 was required to send a board of three names
for discretion inside 30 days of receipt of notice. Since litigant no.1 did not react to the notice
and send a board inside 30 days, it relinquished its entitlement to assign a board. Consequently
Respondent No.1 sent its very own board. Appealing party no.1 again did not react thus it was
educated to the litigant that it had chosen Brig. Nardip singh as a judge. From there on
appealing party no.1 delegated Justice N.N Goswami as a judge. Respondent no.1 presented
that the arrangement of Justice N.N Goswami was invalid and the honor given by him was at
risk to be put aside in perspective on Section 34(2)(v) of the Act.
The request was challenged by the appellants on the grounds, bury
alia, that appealing party no.1 had officially sent a board of three names where the name of
Justice N.N Goswami was referenced at Serial No.1. It was obviously referenced that debates
between the gatherings identifying with every one of the agreements be settled by a similar
referee. The appealing party's Advocate gave an answer to the notice of the respondent and
requested that they pick anybody from the said board. Be that as it may, respondent no.1 sent
its very own board. The arrangement of Brig. Nardip Singh was tested by appealing party no.1
by sending a letter. A letter was likewise sent to Brig. Nardip Singh to halt from procedures
with discretion. It was additionally presented that respondent no.1 did not challenge the locale
of the mediator named by appealing party no.1 as per Section 16 of the Act. The temporary
worker did nor show up at all before the judge named by appealing party no.1 and did not
present any announcement of case. The litigant guaranteed that there was no ground for putting
aside the honor made by Justice N.N Goswami and the request documented under Section 34
of the demonstration recorded by respondent no.1 was subject to be rejected.
The Learned Judge while making the judgment took a note of the
relating arrangements of the UNCITRAL Model law. Article 16 which relates to Section 16 of
the Arbitration Act embraces the significant rule that it is at first and fundamentally for the
Arbitral Tribunal itself to decide if it has locale, subject to extreme Court control. Article 16(1)
of the UNCITRAL Model law expresses that the Arbitral Tribunal has the ability to run without
anyone else ward incorporating any protests regarding the presence or legitimacy of the
63
understanding. Complaints to the Arbitral Tribunal's ward go the very establishment of the
discretion. Article 16(3) stipends the Arbitral Tribunal to govern on a supplication alluded to
in Article 16(2) either as a primer inquiry or in an honor on the benefits. Since India has
received the UNCITRAL Model Law, subsequently where a gathering attests that the arbitral
council has not been appropriately established or it has no purview, at that point such a request
must be raised before the arbitral court directly toward the start and typically not later than in
the announcement of guard with the goal that healing measures might be quickly taken.
The Judge said that however respondent no.1 had sufficient chance to show
up before Justice N.N Goswami and raise a supplication of purview such that he had been
wrongly designated as authority by appealing party no.1, yet, it decided not to do as such. The
Learned Single Judge rejected the request under Section 34 of the Act documented by
respondent no.1. This choice was taken keeping in view the arrangements of the UNCITRAL
Model law.
Thyssen Stahlunion Gmbh Etc v. Steel Authority of India28
In this case, it was held that the Arbitration and Conciliation Act, 1996 is a
progressive Act. The 1940 Arbitration Act had become outdated. Therefore the Arbitration and
Conciliation Act, 1996 was enacted which is based on the UNCITRAL Model Law on
International Commercial Arbitration. It was also held that although the UNCITRAL Model
Law and Rules are intended to deal with international commercial arbitration, but with proper
appropriate modifications, they could serve as a model for legislation on domestic arbitration
and conciliation.
In the present case, the arbitration proceedings started on September 14,1995 under
the old Act of Arbitration i.e. the Arbitration Act, 1940. Request was made to the ICC for
arbitration under the arbitration clause in the contract. Mr. Cecil Abraham of the Malaysian
Bar was appointed as the sole arbitrator on November 15,1995. The sole arbitrator heard the
matter and the award was given on September 24,1997. But by this time the Arbitration and
Conciliation Act, 1996 had already come into existence. Thyssen filed a petition in the Delhi
High Court under Sections 14 and 17 of the old Act for making the award rule of Court. While
28
Thyssen Stahlunion Gmbh Etc vs Steel Authority Of India Ltd on 7 October, 1999;
64
these proceedings were pending in the High Court, Thyssen on February 12,1998 filed an
application under Section 151 of the Code of Civil Procedure for stay of the proceedings. on
the following day, Thyssen filed an application in the High Court for execution of the award
under the new Act. The ground taken by him was that the arbitration proceedings had been
terminated with the making of the award on September 24,1997. Therefore, the new Act was
applicable for enforcement of the award. The Respondent ‘SAIL’ opposed the maintainability
of the execution petition. The main issue in this case was whether the award would be governed
by the new Act for its enforcement or whether provisions of the old Act would apply?
The Court held that when a right accrues to a party under the repealed Act,
it is not necessary for that right to accrue that legal proceedings must be pending when the new
Act comes into force. To have the award enforced when arbitral proceedings commenced under
the old Act under that very act is certainly an accrued right. When the arbitral proceedings
started under the old Act, it was in the minds of arbitrators as well as the parties that the award
given should not fall foul of Sections 30 and 32 of the old Act. Nobody at that time could have
thought that Section 30 of the old Act could be substituted by Section 34 of the new Act. The
new act is based on the UNCITRAL Model Law. Since India is a member of UNCITRAL, it
has adopted the Model Law and thus the Arbitration Act, 1940 was repealed by the Arbitration
and Conciliation Act, 1996 which follows the principles of the Model law. In this case, the
Court was of the opinion that it would be the provisions of the old Act that would apply to the
enforcement of the award.
M/S S.B.P and Co vs M/S Patel Engineering Ltd. and Anr29
The serious issue for this situation was that "What is the idea of the capacity
of the Chief Justice or his assign under Section 11 of the Arbitration and Conciliation Act,
1996. The Arbitration and Conciliation Act, 1996 depends on the UNCITRAL Model Law.
The General Assembly of UNCITRAL has prescribed that all nations should give due thought
to the Model Law. India likewise received the Model Law in its local enactment identifying
with discretion. Segment 11 of the Arbitration Act expresses that where in an intervention
understanding, a question hosts emerged and one of the gatherings had summoned the
29
S.B.P. & Co vs Patel Engineering Ltd. & Anr on 26 October, 2005; https://indiankanoon.org/doc/1641452/;
27 May 2019
65
concurred technique for arrangement of a referee, the gathering looking for an assertion, could
approach the Chief Justice of the High Court on the off chance that it is an inner discretion or
of the Supreme Court on the off chance that it is a universal mediation to have a mediator or
arbitral council selected.
The facts confirm that India has received the UNCITRAL Model Law on
International Commercial Arbitration. In any case, in the meantime it has made a few takeoffs
from the Model Law. Segment 11 compares to Article 11 of the Model law. The Model Law
accommodates the creation of a solicitation under Article 11 to the "Court or other expert
indicated in Article 6 to take the essential measure." The words in Section 11 of the Act, are
"the Chief Justice or the individual or organization assigned by him."
The way that rather than the Court, the forces are presented on the Chief Justice
must be acknowledged with regards to the rule. "Court" is characterized in the Act to be the
standard common court of unique purview of the region and incorporates the High Court in
exercise of its customary unique common locale. The rule common court of unique ward is
regularly the District Court. The High Courts in India practicing conventional unique common
purview are relatively few as well. So in a large portion of the states, the concerned court would
be the area court. The Parliament did not have any desire to give the power on the District
Court, to engage a solicitation for naming an authority or for comprising an arbitral council
under segment 11 of the Act. In this manner the power is given on the most noteworthy legal
expert in that state and in the nation, on Chief Justices of High Courts and on the Chief Justice
of India.
The Court held that typically any council or other expert deliberated with a
capacity to act under a rule, has the purview to fulfill itself that the conditions for the activity
of that control existed and that the case requires the activity of that control. Such an arbitration
identifying with its very own locale which could be known as a choice on jurisdictional
actualities, isn't commonly last, except if it is made so by the Act comprising the Tribunal. It
further expressed that while working under Section 11(6) of the Act, the Chief Justice or the
individual or establishment assigned by him, will undoubtedly choose whether he has locale,
regardless of whether there is an intervention understanding, whether the candidate before him
is a gathering, whether the conditions for exercise of the power have been satisfied and if a
judge is to be delegated, who is the fit individual, as far as the arrangement.
Marriott International Inc. And……. Vs Ansal Hotels Ltd.&

Another30
30
Marriott International Inc. & ... vs Ansal Hotels Limited & ... on 5 July, 2000;
66
For this situation, the Court held that the Indian Arbitration and
Conciliation Act, 1996 depends on the UNCITRAL Model Law which was embraced by the
UNCITRAL in 1985. The General Assembly of the UN has prescribed that all nations give
due thought to the said Model Law, in perspective on the attractive quality of consistency of
the law of arbitral systems and the particular needs of universal business intervention
practice. The UNCITRAL has likewise embraced in 1980 a lot of pacification rules. The
General Assembly of the UN has prescribed the utilization these Rules in situations where the
questions emerge with regards to global business exchanges and the gatherings look for
friendly settlement of their debates by plan of action to assuagement. The most significant
element of the UNCITRAL Model Law is that they have orchestrated ideas on discretion and
appeasement of various lawful frameworks of the world and contains arrangements which are
intended for all inclusive application.
The UNCITRAL Model Law additionally fills in as a model for enactment on
household assertion and placation. The Arbitration and Conciliation Act, 1996 is an Act to
solidify and correct the law identifying with residential intervention, International business
mediation and implementation of remote arbitral honors.
Segment 9 of the Arbitration Act is an imitation of Article 9 of the UNCITRAL
Model law on International Commercial Arbitration. Article 9 of the UNCITRAL Model Law
expresses that "It isn't incongruent with a discretion understanding for involved with
solicitation, previously or amid arbitral procedures, from a Court an interval proportion of
assurance and for a Court to give the security. The expectation of the officials in
consolidating Article 9 is that the gathering before arbitral procedures or whenever
subsequent to creation of the honor however before requirement can apply to the Court for
break help under Section 9.
Sime Darby Engineering Sdn, Bhd vs. Engineers India Ltd.31
31
Sime Darby Engineering Sdn,Bhd vs Engineers India Ltd on 22 July, 2009;
67
For this situation, the request was documented under Section 11 of the
Arbitration and Conciliation Act, 1996 by the candidate for arrangement of the arbitral
council to mediate the cases and questions between the applicant and respondent. The
candidate is an organization consolidated and existing under the laws of Malaysia. The
respondent then again is an organization consolidated under the Indian Companies Act, 1956.
The Learned Counsel for the solicitor presented the mediation provision in the agreement
which administer the privileges of the gatherings in the matter of discretion. The mediation
proviso expresses that the gatherings will settle any debate or contrast agreeably through joint
arrangement. On the off chance that any debate can't be commonly settled by the gatherings,
it will be alluded to mediation as per the arrangements contained in Indian Arbitration and
Conciliation Act, 1996 which is as per UNCITRAL Rules. It additionally expresses that the
said statement does not demonstrate about the quantity of mediators to be selected and along
these lines, the issue ought to be alluded to assertion as per the arrangements of the Indian
Arbitration and Conciliation Act, 1996 which is as per UNCITRAL rules. The provision
expresses that the discretion between the gatherings would be administered under the
Arbitration and Conciliation Act, 1996 which is represented by UNCITRAL Rules.
The Learned Counsel contended that if certain statements of the

understanding and Sections 10(1) and 10(2) are perused agreeably with UNCITRAL Model
Rules, the arrangement of a board of three referees on this case can't be discounted. Segment
10(2) of the Act is exceptionally important so as to determine the debate for this situation.
Segment 10(2) states that if the quantity of judges isn't resolved, the arbitral court will
comprise of a sole mediator. In this association if UNCITRAL Rules are alluded, the position
will continue as before. Article 10 of the UNCITRAL Model Law is equivalent to Section 10
of the Arbitration Act. The UNCITRAL Model Law on International Commercial Arbitration
likewise acknowledges a similar meaning of Arbitral Tribunal in Article 2(b).
The Court held that Section 10 of the Indian Arbitration and Conciliation Act,
1996 veers off from Article 10 of the UNCITRAL Model Law just as in area 10(1) of the Act
gives that regardless of the opportunity given to the gatherings to decide the quantity of
authorities, such number will not be significantly number. Be that as it may, in default of
68
assurance of the number, Section 10(2) gives the court is to comprise of a sole referee.
Consequently, plan of Section 10(2) of the Act is for all intents and purposes like Article
10(2) of the UNCITRAL Model Law.
Vikrant Tyres Limited and Another vs. Techno Expert Foreign

Trade32
For this situation, the Judge held that the Arbitration and Conciliation Act, 1996 is
brought about by the impulses of globalization prompting selection of UNCITRAL Model
Law on International Commercial Arbitration. The Arbitration and Conciliation Act,1996 is
all around a coordinated adaptation of the prior assertion demonstration of 1940. The new
demonstration depends on the UNCITRAL Model Law. Sections I to VIII of the UNCITRAL
Model Law is the copy of Chapter I to VIII of Part I of Arbitration and Conciliation Act,
1996. There is just a single distinction among them and that is in UNCITRAL Model Law,
the arrangement is called article and in Arbitration and Conciliation Act, 1996, the
arrangement is known as segment. In spite of the fact that the Arbitration and Conciliation
Act, 1996 depends on the UNCITRAL Model Law on International Commercial Arbitration,
yet it makes a takeoff from the UNCITRAL somewhat relating in legal intercession and legal
cures in regard of local assertion and worldwide intervention.
The arrangements of Section 37(2) offers impact to the arrangements of
Article 16(3) of the UNCITRAL by temperance of which an intrigue is given against the
request of the Arbitral Tribunal with respect to its locale to settle the question. In spite of the
fact that the arrangements of Article 16 of the UNCITRAL Model Law contributes ward on
the arbitral council to control without anyone else locale, an intrigue is given against such
request to the Court under Article 16(3). The Court under Section 37(2) pending intrigue has
coincidental and subordinate purview to allow remain of the arbitral procedures. Comparative
is the situation in Article 16(3) read with Article 9 empowers the redrafting court to pass a
between time request remaining the discretion continuing. In this manner, in the UNCITRAL,
it is to be seen that the legal intercession isn't completely prohibited to test the request of the
arbitral council by the Court pending intervention. In spite of the fact that the Arbitration and
32
Vikrant Tyres Limited And Anr. vs Techno Export Foreign Trade ... on 15 April, 2005;
69
Conciliation Act, 1996 has received the strategy and way of legal intercession and legal cures
imagined in UNCITRAL, yet it keeps an insightful and remarkable refinement between the
household mediations and global assertions.
The Judge additionally held that the pre-discretion cure visualized under Section 45 of the
Arbitration and Conciliation Act, 1996 albeit obviously appears somewhat a takeoff from the
UNCITRAL, however it isn't conflicting with the soul and plan of UNCITRAL which does
not thoroughly preclude legal mediation amid the pendency of assertion. The Court has ward
under Section 11 comparing to article 11 of the UNCITRAL to select the authority where
there is a difference between the gatherings in naming the mediator or the named judge won't
referee. For this situation, the Counsel for the respondent has neglected to put material even
in the intrigue, to indicate whether the bound together territory of Czechoslovakia or the new
State of Czech Republic has ordered any law on the model of UNCITRAL similar to Article
11. Article 11 of the UNCITRAL Model Law or Section 11 of the Indian Arbitration and
Conciliation Act,1996 does not imagine possibility of Court's intercession to delegate
authority when the named judge ends up terminated.
It very well may be seen that the arrangements for alleviation under Article 9 and
Article 34 of the UNCITRAL Model Law while characterizing jurisdictional court on account
of global mediation does not explicitly announce the "Court" to mean the court of the nation
of the discretion scene. However, Article 36(1)!v) states that an application under Article 34
for putting aside the honor is to be made in the court of the nation where the honor is passed.
Yet, in regards to cure under Article 9 of the UNCITRAL Model Law comparing to Section 9
of the Arbitration and Conciliation Act,1996, it is to be comprehended that the court of
common ward of the gathering and the Court of the nation where intervention is held
simultaneously have locale to allow between time alleviation.
The Judge additionally expressed that the cure under Section 34 of the
Arbitration and Conciliation Act, 1996 which relates to Article 34 of the UNCITRAL Model
Law is a post arbitral cure. The cure is made relevant just for local assertion and not global
mediation and grant, which is administered by Part II. Area 48 of the Indian Arbitration and
Conciliation Act, 1996 which compares to Article 36 of the UNCITRAL Model Law is a post
arbitral solution for oppose the authorization of the honor on evidence of the grounds
referenced in that.
M.M.T.C Limited vs. Priyanka Overseas Limited
70
For this situation, the scholarly Judge cited the perception of Dr. Diminish Binder in regards
to the UNCITRAL Model Law on International Commercial Arbitration which is as per the
following : "It is much of the time unquestionably far less entangled to persuade the arbitral
council, which is exclusively given to the current case and which knows about the conditions,
to issue a between time measure, than a Court, which just assumes the job of the security net
out of sight. Be that as it may, to protect the trustworthiness of the organization of mediation
for the most part and to help it and its autonomy from the Courts, an arrangement like Section
17 is of significant significance.
The Judge held that the Arbitration and Conciliation Act, 1996 which depends on the
UNCITRAL Model Law on International Commercial Arbitration is a long jump toward
substitute debate goals frameworks. The choosing cases under the former demonstration of
1940 must be connected with alert for deciding the issues emerging for choice under the new
Act.
M/S Konkan Railway Corpn. Ltd. Vs. M/S Rani Construction Pvt.
Ltd.33
The Learned Solicitor General presented that in nations where the UNCITRAL
Model Law on International Commercial Arbitration is embraced and where the referee
additionally is allowed to choose inquiries with regards to the presence of the intervention
statement or legitimacy of the understanding, the Court can choose certain starter debates
which are raised before it at or before the arrangement of mediators, for example, debates
identifying with presence of the discretion understanding or an inquiry with regards to the
very presence of a question or concerning whether things of debates fell inside 'excepted'
matters or whether an authority could be delegated where the summon of the proviso by one
33
M/S Konkan Railway Corpn. Ltd. & ... vs M/S Rani Construction Pvt. Ltd on 19 October, 2000;
71
gathering was past the endorsed period wherein one needs to request that the opposite side
select a judge.
Under Section 16(2) of the new Act, the authority is presently enabled to choose
his own locale including any complaint with regards to the presence or legitimacy of the
understanding and for that reason, the discretion statement is considered to be free of the
primary contract (called Kompetenz-Kompetenz guideline ). The Counsel battled that, it
might be that in circumstances where the issue has straightaway gone before a referee before
a demonstration of gatherings without intercession of the Court, the authority is currently
statutorily enabled to choose these fundamental inquiries moreover. Yet, when a case
precedes legal specialist and the litigant argues that there is a mediation statement (Section 8
of the new Act), or where because of the non-arrangement of a judge, the Court is drawn
closer for arrangement of a mediator (Section 11), the Court can choose these primer issues
judicially and need not precisely select a referee under Section 11 in such cases. The intensity
of the Court has not been removed by the new Act. It was fought that, this is as yet the law in
all nations where UNCITRAL model has been received. In every single such case, the request
of the Court or the Chief Justice will be a 'legal' one and not a regulatory request. It was
called attention to that the UNCITRAL Model Law utilizes the words 'Court or other
specialist' in Article 6 and Article 11.
Shin-Etsu Chemical Co. Ltd. Vs. M/S Akash Optifibre Ltd. And
Anr.34
In this case, the Judge stated that the Indian Arbitration and Conciliation Act, 1996
is based on the UNCITRAL Model Law on International Commercial Arbitration which was
adopted by the General Assembly of the UN. The Court observed that the objective was to
pursue the “progressive harmonization and unification of the Law of International Trade.”
Aastha Broadcasting Network Ltd. Vs. Thaicom Public Company

Ltd.
The intrigue was documented to scrutinize the competency of the Delhi High Court
to hear complaints recorded under Section 34 of the Arbitration and Conciliation Act, 1996 qua
an arbitral honor gone by an arbitral council in an International Commercial Arbitration. The
34
Shin-Etsu Chemical Co. Ltd vs M/S. Aksh Optifibre Ltd. & Anr on 12 August, 2005;
72
appealing party tried to record protests and the respondent contested the purview of the Court
to engage the application under Section 34 of the Act similar to an International Commercial
Arbitration. The supplication of the respondent discovered support with the scholarly single
Judge regarding the reprimanded request. Provision 14 of the understanding given to goals of
debates through intervention and the standards of UNCITRAL were to apply with the
mediation to be held in Singapore and in the English language. In these conditions, the
respondent argued that the substantive law material to the understanding was the law of
Singapore and, in this manner, the purview of the Delhi High Court was prohibited.
The scholarly single Judge held that once the assertion procedures initiate and
the UNCITRAL Rules become material in the present case according to the provisions in the
understanding and the procedures were administered according to conditions 13 and 14 of the
understanding alluded to previously mentioned, there can be no uncertainty that Part I of the
said Act would have no application to the present case. The conjuring by the respondent of the
arrangements of Section 11(6) of the said Act would, along these lines not infer that the
procedures are to be represented by Part I of the said Act, undisputedly the discretion
procedures having occurred in Singapore.
M/S Nilkamal Ltd. Vs., Patna vs. The State of Bihar and Ors
In the present case, the Court held that the Arbitration and Conciliation Act,
1996 has been legislated by the Parliament whereas Bihar Public Works Contract Disputes
Arbitration Tribunal Act, 2008 has been legislated by the State Legislature. The Arbitration
Act has been enacted following the UNCITRAL Model Law on International Commercial
Arbitration. The General Assembly of the UN recommended that all countries give due
consideration to the said Model Law, in view of the desirability of uniformity of the law of
arbitral procedures and the specific needs of international commercial arbitration practice. The
Parliament enacted the Arbitration and Conciliation Act, 1996 based on the UNCITRAL Model
Law on the recommendation of the Law Commission of India to deal with domestic as well as
international commercial dispute. It held that the Arbitration Act is a complete code which
provides in case of commercial dispute in what manner the arbitrator will be appointed for
resolution of commercial dispute.
73
Union of India Ministry Of ….. vs Hardy Exploration and
Production
For this situation, Dr. Singhvi, the scholarly Senior Counsel asked that what is the
impact of UNCITRAL Model Law, when they are made piece of the intervention
understanding for choosing the subject of "situate" has likewise not been so far chosen in any
of the previous choices. The Court held that on a scrutiny of Articles 20 and 31(3) of the
UNCITRAL Model law, the gatherings are allowed to concede to the spot of assertion. When
the said assent is given in the assertion proviso or it is interpretably derived from the condition
and other attending factors like the instance of Harmony Innovation Shipping Ltd. Which states
about the setting and something also by which the seat of assertion is definite. The other mode,
as Article 20 of the UNCITRAL Model Law gives, is that where the gatherings don't concede
to the spot of assertion, the equivalent will be dictated by the arbitral court.
As should be obvious through a few cases that the Judges while settling on the
issue has given due thought to the UNCITRAL Model Law on International Commercial
Arbitration. The Judges have over and over expressed that the Arbitration and Conciliation
Act, 1996 depends on the UNCITRAL Model Law and in this way while giving the judgment,
due thought ought to be given to the UNCITRAL Model Law. For each situation we can see
that there is a reference to the UNCITRAL Model Law on International Commercial
Arbitration.
The Judges have expressed the motivation behind the UNCITRAL Model Law on
International Commercial Arbitration in pretty much every case law that there ought to be
consistency and attractive quality of local just as universal business intervention practice. In
spite of the fact that the Arbitration and Conciliation Act, 1996 depends on the UNCITRAL
Model Law and the areas in the Arbitration Act compare to the Articles in the UNCITRAL
Model Law, yet the Arbitration Act makes a takeoff from the UNCITRAL Model Law
somewhat. This can be found in the different legal choices.
Obviously the UNCITRAL Model Law on International Commercial Arbitration
assumes a key job in issues concerning assertion in our nation. The most significant element
of the UNCITRAL Model Law is that they have blended ideas on assertion and mollification
74
of various lawful frameworks of the world and contains arrangements that are intended for
widespread application. The UNCITRAL Model Law and the Arbitration and Conciliation Act,
1996 compares to one another and the UNCITRAL Model Law hugy affects Indian
intervention. This is demonstrated by the few cases referenced here.
75
Chapter IV
SUCCESS AND CRITICSM OF UNCITRAL MODEL LAW OF

DISPUTE RESOLUTION MECHANISM IN INDIAN
CORPORATE SECTOR
76
SUCCESS AND CRITICSM OF UNCITRAL MODEL
LAW OF DISPUTE RESOLUTION MECHANISM IN
INDIAN CORPORATE SECTOR
The Indian Arbitration and Conciliation Act, 1996 depends on the UNCITRAL Model
Law on International Commercial Arbitration and the UNCITRAL Model Law on International
Commercial Conciliation. Discretion, mollification, intervention, dealings are various types of
ADR. With the effect of the UNCITRAL Model, ADR has developed hugely in India. ADR
can be characterized as an aggregate depiction of procedure or systems that gatherings can use
to determine debates as opposed to bringing a case through the formal court structure. ADR is
essentially an outside the court settlement. ADR assumes a significant job in settling debates
and it additionally helps in sparing the important time of the Court.
The Arbitration Act, 1940 managed just residential assertion. At that point came into
power the Arbitration and Conciliation Act,1996 which canceled the old Act and which
depended on the UNCITRAL Model Laws.
ADR has a significant spot in India. The Court cases were both costly and
tedious. Consequently the idea of assertion, placation, intervention, arrangement and Lok
Adalats came into power. ADR is picking up prominence step by step since it spares the tedious
procedure of suit just as the expenses and deficiency of the Court framework. The motivation
behind ADR is to determine the contention in a more practical and sped up way, while
cultivating long haul connections. In ADR, an elective way is discovered which go about as a
substitute for suit. It helps in diminishing the quantity of cases. It is a lot less expensive than
prosecution and less formal and convoluted. These days even Judges prescribe the utilization
of ADR to stay away from court cases. ADR underscores upon intervention, expanding
availability to equity, improving effectiveness and diminishing Court delays. ADR is
unquestionably less expensive and an expedient type of question goals instrument. It gives a
cure which is most suitable in the conditions of the case. It is generally a non-legal methods or
strategy for the settlement of questions. In ADR, the gatherings can straightforwardly consult
with one another before some lawful procedure. It resembles a smaller than normal preliminary
procedure which happens outside the Court.
Appropriate to expedient preliminary is a privilege to life and individual freedom
of each native ensured under Article 21 of the Constitution, which guarantees simply,
77
reasonable and sensible method. In the course of the most recent couple of decades, there is a
noteworthy increment in universal exchange and trade. In this way the quantity of business
questions additionally expanded. ADR component assumes a significant job in settling
questions in worldwide clashes. Courts settle debates by means of a coupling procedure by
applying legitimate and impartial standards to discoveries of truth. With a regressive looking
methodology, the result of Court endeavors depends to a great extent after finding reality about
something that happened previously. Subject to inflexible procedural and evidentiary
principles, Courts give lawful responses to inquiries of qualifications and of rights.
ADR urges individuals to partake during the time spent contest goals. It makes
a legitimate mindfulness. It gives a gatherings an opportunity to decrease antagonistic vibe. It
typically happens in private and is in this way increasingly practical, financial and proficient.
Here the gatherings settle their disparities without anyone else and consequently there is no
need of an outcast to manage. Since the gatherings are effectively engaged with the procedure
of question goals, in this manner they can all the more viably achieve a settlement.
Points of interest of ADR
ADR has a great deal of preferences. They are as per the following:
1. A single technique : Through ADR, the gatherings can consent to determine a question
in a solitary method. Along these lines, the weight of costs and multifaceted nature of multi-
jurisdictional suit is maintained a strategic distance from.
2. Party Autonomy : ADR is private in nature. The gatherings can resolve their debates
without anyone else subsequently staying away from Court case. The gatherings can pick a
choice that is most proper for them. Besides, they can pick the relevant law, spot and language
of the procedures.
78
3. Neutrality: ADR can be unbiased to law, language and institutional culture of the
gatherings.
4. Confidentiality : ADR is private. Along these lines secrecy is kept up between the
gatherings.
Why ADR is superior to suit?
Case is a formal open procedure which settle debates through a Court with a Judge or Jury. It
is liable to severe standards forced by law administering the lead of the procedure, for example,
the formal principles of proof. Then again, mediation is a private procedure where the
gatherings comprehend their questions without anyone else by hearing an unbiased outsider.
Intercession is an exchange encouraged by a nonpartisan outsider. The middle person
encourages the gatherings to achieve a neighborly settlement.
Advantages of Arbitration
Discretion offers a superior option in contrast to case. Its favorable circumstances are as per
the following:
1. Flexibility and Control : The gatherings are allowed to settle their terms in the
mediation. They would themselves be able to administer how the procedure will function.
2. Speed : It is significantly more speedier than prosecution.
79
3. Low Cost : It is practical since disclosure is considerably more constrained in discretion
and advances are restricted.
4. Privacy and Confidentiality : Arbitrations are private procedures. There are just
assigned gatherings and a classification is kept up between the gatherings.
5. Arbitrator Selection : The gatherings are allowed to pick a mediator with topic ability
instead of being allocated a Judge arbitrarily.
6. Finality : Appeal rights are exceptionally constrained in intervention. So debates are

settled all the more rapidly.
The traditional case process requires a great deal of desk work and overwhelming procedural
prerequisites. It requires a lot of time and assets. It more often than not takes a very long time
to determine these questions. The ADR procedure is an a lot less difficult procedure. It is
practical just as expedient. The gatherings in ADR are allowed to pick their authorities. The
gatherings can pick authorities who have involvement just as topic capability to settle on an
educated and impartial choice. Likewise, the mediator's basic leadership process is available to
dynamic cooperation by the contesting parties. It offers the gatherings an opportunity to
maintain a strategic distance from court. A ton of time just as vitality of the gatherings is
squandered in the court. ADR, on different hands offers a progressively pertinent settlement.
Criticism of the UNCITRAL Model Law on Dispute Resolution Mechanism

in Indian Corporate Sector
We realize that the Indian Arbitration and Conciliation Act, 1996 depends on the UNCITRAL
Model Law on International Commercial Arbitration and Conciliation. ADR has turned into a
significant part in India for the goals of questions. It is fast, financially savvy and an a lot less
complex procedure. Be that as it may, it has certain impediments. There is no ensured goals.
One decides on ADR in view of outside the court settlement yet may in the long run need to
80
go for prosecution. So here the time and vitality of the gatherings are squandered. In addition,
the discretion choices are conclusive. The choice of a mediator can't be bid. It isn't required
that an authority will dependably give a reasonable choice. The authority can likewise surpass
the extent of the assertion statement or understanding. Though the choices of a Court are
typically appealable.
The referees can just purpose questions that include cash. In contrast to the Court,
they can't force a gathering to accomplish something or cease from accomplishing something
like order. The authority charges an expense for his or her administrations. Though a Judge
charges no expenses for his administration. on the off chance that a gathering isn't happy with
the choice of the judge, they can record a solicitation for preliminary with the court inside a
predetermined timespan after the mediation grant. Contingent upon the procedure requested, if
that party does not get an increasingly good outcome at preliminary, they may need to pay a
punishment or charges to the opposite side.
Additionally, there is no ensured goals. It is conceivable that one can contribute
a great deal of cash and time in settling a question yet at the same time not get any outcome.
At last, he should continue with prosecution. In this way, the out of the court settlement isn't
constantly valuable. The choice of the Arbitral Tribunal is conclusive and isn't appealable.
81
Chapter V
A COMPARATIVE STUDY
82
A COMPARATIVE STUDY
UNCITRAL membership originally comprised of 29 states.

Then it was expanded to 36 in 1973 and again to 60 in 2004. The members are selected from
different legal traditions and levels of economic development as well as different geographic
regions. States comprises of 12 African States, 15 Asian States, 18 European States, 6 Latin
American and Caribbean States and 1 Oceanian State. The membership of UNCITRAL is as
follows:
Africa :
1. Algeria (2016)
2. Burundi (2022)
3. Côte d'Ivoire (2019)
4. Kenya (2022)
5. Lesotho (2022)
6. Liberia (2019)
7. Mauritania (2019)
8. Mauritius (2019)
9. Namibia (2019)
10. Nigeria (2022)
11. Sierra Leone (2022)
12. Somalia (2017)
13. Uganda (2022)
14. Tanzania (2022)
15. Zambia (2019)
Asia:
1. India (2022)
2. China (2019)
3. Indonesia (2019)
4. Iran (2022)
5. Israel (2022)
6. Kuwait (2019)
7. Lebanon (2022)
8. Japan (2019)
83
9. Malaysia (2019)
10. Pakistan (2022)
11. Philippines (2022)
12. Singapore (2019)
13. South Korea (2019)
14. Sri Lanka (2022)
15. Thailand (2022)
Europe:
1. Armenia (2019)
2. Austria (2022)
3. Belarus (2022)
4. Bulgaria (2019)
5. Czech Republic (2022)
6. Denmark (2019)
7. France (2013)
8. Germany (2013)
9. Greece (2013)
10. Hungary (2019)
11. Italy (2016)
12. Lithuania (2019)
13. Poland (2012)
14. Romania (2016)
15. Russia (2013)
16. Spain (2016)
17. Switzerland (2019)
18. United Kingdom of Great Britain and Northern Ireland (2019)
19. Turkey (2022)
North America:
1. Canada (2019)
2. El Salvador (2019)
3. Honduras (2019)
4. Mexico (2019)
5. Panama (2019)
6. United States of America (2022)
84
Oceania:
Australia (2022)
South America:
1. Argentina (2016)
2. Brazil (2022)
3. Chile (2022)
4. Colombia (2022)
5. Ecuador (2022)
6. Venezuela (2022)
The UNCITRAL Model Law of International Commercial Arbitration and the

UNCITRAL Model Law on International Commercial Conciliation were adopted by the
UNCITRAL in 1985. It was enacted to deal with international commercial arbitration. The
General Assembly of the UN had recommended that all the member countries of the
UNCITRAL shall give due consideration to this Model Law in view of the desirability and
uniformity in international commercial practices. India has enacted the Arbitration and
Conciliation Act,1996 keeping in mind the UNCITRAL Model Laws. 74 other countries
have also adopted the UNCITRAL Model Law on International Commercial Arbitration.
We can study the trend in international commercial arbitration on different
countries through various case laws:
Enercon (India) Ltd. & Ors. v. Enercon GmbH & Anr.
85
For this situation, the petitioner was an Indian merchant and the respondent is a German
organization. They went into a joint endeavor under which the petitioner was to make and
sell wind turbine generators utilizing the patent innovation of the respondent. Both the
gatherings went into a few understandings out of which there was an understanding
"Protected innovation License Agreement" which had an intervention provision. Under the
understanding, there was a condition about the scene of assertion which gave that the setting
would be London and each gathering would select a judge. There was no arrangement for
naming a third judge.
The debate was about the non-conveyance of products by the respondent. The
petitioner recorded an application under the steady gaze of the Indian Court looking for
resumption of conveyance and a between time request for the inquirer was issued. A notice
of assertion was issued by the respondent. He named an authority based on the intervention
provision contained in the IPLA. The respondent additionally documented an application
under the watchful eye of the English Court for definitive help on the constitution of the
arbitral council under the IPLA. Parallel procedures occurred in India. In the long run the
Supreme Court of India was caught where the inquirer contended that the IPLA was not a
truly finished up contract and that in any occasion, the discretion understanding was not
"functional".
The Court held that in spite of the fact that there were different
understandings for goals of debates by discretion, the topic of the "finished up contract"
was insignificant. Segment 16 of the Arbitration and Conciliation Act,1996 which relates
to Article 16(1) of the UNCITRAL Model Law accommodates distinguishableness of the
intervention understanding and the basic contract. In this way, the previous couldn't be
influenced by a conceivable deficiency of the last mentioned. Further, by investigating the
conditions of the case, it tends to be seen that it was the aim of the gatherings to mediate
according to Section 7 of the Arbitration and Conciliation Act, 1996 which compares with
Article 7 of the UNCITRAL Model Law.
To the extent the seat of Arbitration is concerned, the Supreme Court
held that given the gatherings had picked Indian Law to be material to three distinctive
related understandings, their aim couldn't have been to make an extraordinarily
troublesome circumstance of outrageous complexities by fixing the seat of assertion in
London. The gatherings' decision for London as a 'setting' was for a nonpartisan spot to
hold the procedures of mediation. Consequently, the Court chose that the seat of discretion
was India.
86
Malini Venture v. Knight Capital Pte Ltd. and others
For this situation, debate was in regards to a Personal Guaranteed Deed (the
Deed). In that deed, the offended party in the Court procedures consented to ensure the
reimbursement of advance to a Singapore joined Company (the borrower). There was an
assertion understanding in the deed which contained that "any issue or thing at all nature
emerging thereunder or in association therewith, including any inquiry with respect to its
reality, legitimacy or end" would be presented by a solitary judge to be selected by the
gatherings or, if the gatherings couldn't concur, by the President of the Court of Arbitration
of the Singapore International Arbitration Centre (SIAC). The borrower defaulted on the
planned reimbursement of credit and the litigants requested that the offended party
reimburse the advance compliant with the deed. It was denied by the offended party and
the respondents started a SIAC Arbitration for reimbursement of the credit. A stay of the
assertion procedures was connected by the offended party on the ground of absence of
ward. In any case, the application was denied by the sole judge on the premise that the
arbitral court had capacity to settle on its own locale under Rule 25.2 of the SIAC Rules.
After three days, the offended party recorded an application in the High Court chasing an
assertion that she had not gone into a discretion concurrence with the litigants on the
grounds that the mark on the Deed had been produced, and (ii) a directive to limit the
respondents from proceeding with the SIAC intervention.
The High Court rejected the offended party's application for a between time
order and allowed the litigant's application for a stay for the assertion procedures. The High
Court held that Courts have purview to settle on the presence of an agreement, including
the presence of an intervention understanding. Be that as it may, if the gatherings had
consented to submit debates to assertion, the Court's purview "must offer way" to the
arbitral council's ward as required by Section 6 of the IAA, Article 16 of the UNCITRAL
Model Law and Rule 25.2 of the SIAC Rules, which explicitly engage arbitral councils to
choose the presence of the gatherings' mediation understanding.
87
BNP Paribas & Ors. v. Deloitte & Touche LLP
For this situation, an understanding occurred between a bank (the purchaser or

petitioner) and a vehicle rental organization (the merchant) under which the bank purchased a
gathering of the dealer's organizations. The purchaser initiated arbitral procedures in light of
the fact that the merchant made false and fake deceptions, exaggerating the estimation of the
matter of the organizations by countless American dollars. The merchant with all due respect
depended on the observer articulation of an outsider from a reviewing firm (the respondent for
the current situation). As per the purchaser, proof supporting its case was still possessing the
outsider. Amid the arbitral continuing, the arbitral court expressed that the archives "are or
might be applicable to the issues in debate in this assertion and gives its consent to the
gatherings to demand their generation from [the third party], if important, as per Section 43 of
the Arbitration Act 1996."
The Court distinguished the lawful issue as being whether the Court has the
power under the Arbitration Act, 1996 to arrange an outsider [that is an individual who isn't
involved with the assertion in question] to make divulgence of archives. The respondent
expressed that Section 43 of the Arbitration Act 1996 does not enable the national court to
apply for a request of revelation whether from a gathering or outsider. The petitioner battled
the opposite since this arrangement got from Article 27 of the UNCITRAL Model Law with
respect to the take of proof. In spite of the fact that the court affirmed that Article 27 of the
Model Law was managing "there was nothing in the Model Law which proposes that the Court
should help with the procedure of exposure". Taking into account that inquirer's application
was not for generation of indicated records, however for a wide classification of archives, it
thought of it as excessively broadly encircled to fall inside Section 43 and subsequently rejected
it.
GE Capital (Thailand) Company Limited v. Noppadol

Manorotpanich
88
The case deals with the validity of a loan agreement concluded via an automated teller machine.
The defendant had debited money from an ATM by using Quick Cash Card. The money was
not withdrawn from the account of the defendant but borrowed according to a loan agreement.
The request for cash was authenticated by inputting a 4 digit personal identification number
and confirmed by pressing a dedicated confirmation button. The automated teller machine
disbursed cash and a paper slip confirming the transaction and indicating the fee charge and
the applicable interest rate.
The Supreme Court recalled that under Section 7 of the Electronic Transactions Act
B.E. 2544 (2001), information shall not be denied legal effect and enforceability solely on the
ground that it is in the form of a data message and that under Section 8 of that Act a requirement
for written evidence may be satisfied by a data message that is accessible and usable for
subsequent reference. The Supreme Court further explained that inserting a personal
identification number and pressing the confirmation button constituted an electronic signature
equivalent to a handwritten signature under Section 9 of the Electronic Transactions Act B.E.
2544 (2001), requiring for that purpose the use of a reliable method capable of identifying the
signatory and indicating the signatory’s approval. The Supreme Court concluded that the
evidence of the loan provided was sufficient and that the loan should be repaid.
Alberta Court of Appeal (Fraser, Conrad JJ. A., Picard J.)
In this case, the claimant (main contractor) appealed against the decision of the
lower Court, which had referred various disputes between the claimant and the respondent
(sub-contractor) to arbitration. It was argued by the claimant that the submission of the disputes
to arbitration was optional under the sub-contracting agreement. The disputes related to non-
arbitrable matters. The claimant also argued that the submission of the disputes to arbitration
was not made within the prescribed time limits set forth in the main contract and incorporated
89
by reference into the sub-contracting agreement. It was finally concluded by the claimant that
the respondent had waived its right to arbitration by commencing a Builder’s Lien action.
The Court dismissed the appeal. It was held that the sub-contracting agreement
provided for arbitration upon the request of either party. The use of the word ‘may’ in the
arbitration clause was to be interpreted to mean that either party had an option to proceed with
arbitration, and not that the submission of disputes to arbitration was optional. The Court
exercised its inherent jurisdiction to stay the Builder’s Lien action, until completion of the
arbitral procedure, considering that a multiplicity of proceedings was not desirable.
90
Chapter VI
APPRAISALS AND SUGGESTIONS
91
APPRAISALS AND SUGGESTIONS
The UNCITRAL Model Law of international commercial arbitration as

well international commercial conciliation tends to resolve disputes relating to international
commercial arbitration and conciliation. India has enacted its Arbitration Act i.e. the
Arbitration and Conciliation Act 1996 keeping in mind the above two models. Since that time
these two models have played an important role in the Indian corporate sector. All the
sections in the Arbitration and Conciliation Act corresponds to the Articles in these two
Model Laws. With the advancement of technology, trade has also increased tremendously
even at international levels. It is quite natural that where there is trade, dispute is bound to
arise. To resolve these disputes, the Arbitration and Conciliation Act 1996 was enacted. The
parties to an agreement can settle their disputes by themselves without the interference of
Court.
Alternate Dispute Resolution Mechanism (ADR) is the new trend in India these days. It is
the process of settling disputes without litigation, such as arbitration, mediation or
negotiation. In ADR, the disagreeing parties come to an agreement with the help of a third
party. ADR has gained tremendous popularity because of the increasing case load of
traditional Courts. It is most cost effective and provides a speedy resolution. 35
The main types of ADR in India are as follows:
 Arbitration:
It is mainly a private, informal and non-judicial trial procedure for settling

disputes. The parties resolve their disputes with the help of an arbitrator. The dispute
is submitted to the Arbitral Tribunal who grants an award on the dispute that is
binding on the parties. it is a forum chosen by the parties with an intention that it must
act judicially after taking into account relevant evidence before it and the submission
of the parties. Hence it follows that if the forum chosen is not required to act
judicially, the process it is not arbitration. Now there are four different types of
arbitration in India. They are as follows:
 Ad Hoc Arbitration
35
ADR in India: Legislations and Practices – Academike; https://www.lawctopus.com/academike/arbitration-
adr-in-india/; 27 May 2019
92
This type of arbitration is not administered by an institution. The parties determine all aspects
of the arbitration like the number of arbitrators, manner of their appointment etc. Ad hoc
proceedings are cheaper, flexible and faster than an administered proceeding. In this type, the
parties themselves arrange and agree to the dispute. It is not administered by any institution
but it requires the parties to make their own arrangements for selection of arbitrators and for
designation of rules, applicable law, procedures and administrative support. This is a popular
choice because of the absence of administrative fees. The arbitration agreement, whether
arrived at before or after the dispute arises, might simply state that "disputes between the
parties will be arbitrated", and if the place of arbitration is designated, that will suffice. If the
parties cannot agree on arbitral detail, all unresolved problems and questions attending
implementation of the arbitration, for example "how the arbitral tribunal will be appointed",
"how the proceedings will be conducted" or "how the award will be enforced" will be
determined by the law of the place designated for the arbitration, i.e., the "seat" of the
arbitration.
This approach will work only if the jurisdiction selected has an established
arbitration law. The appointment of a qualified and an impartial arbitrator constitutes a sticking
point in ad hoc proceedings. In that case, the parties can agree to designate an institutional
provider as the appointing authority. Parties wishing to include an ad hoc arbitration clause in
the underlying contract between them, or seeking to arrive at terms of arbitration after a dispute
has arisen, have the option of negotiating a complete set of rules, establishing procedures which
fit precisely their particular needs. Experience has shown that this approach can require
considerable time, attention and expense without providing assurance that the terms agreed will
address all eventualities.
The other options available to parties who wish to proceed ad hoc are :
(i) Adapting the rules of an arbitral institution, amending provisions for selection of an
arbitrator(s) and removing provisions for administration of the arbitration by the
institution;
(ii) Incorporating statutory procedures such as the United States Federal Arbitration Act
(or applicable State law) or the English Arbitration Act 1996;
(iii) Adopting rules crafted specifically for ad hoc arbitral proceedings such as the
UNCITRAL Rules or CPR Rules (International Institute for Conflict Prevention
and Resolution), which may be used in both domestic as well as international
93
disputes; and
(iv) Adopting an ad hoc provision copied from another contract.
However, there are certain risks in adopting these methods. It creates
ambiguities in the institutional rules as amended, despite efforts to redraw them to suit an ad
hoc proceeding. It can also happen that the parties may inadvertently create an institutional
process. The ad hoc arbitration clause can also be copied from another contract’s clause which
was originally drafted for a particular, possibly unique set of circumstances and/or was drafted
taking into account different applicable arbitration law.
The ad hoc arbitration is less expensive than institutional arbitration. It places
the burden more on the arbitrator and less on the parties, to organize and administer the
arbitration in an effective manner. A distinct disadvantage of the ad hoc approach is that its
effectiveness may be dependent upon the willingness of the parties to agree upon procedures
at a time when they are already in dispute. If both the parties fail to cooperate, it can result in
an undue expenditure of time in resolving the issues. On the other hand it is quite flexible and
requires a greater degree of effort, cooperation and expertise of the parties in determination of
the arbitration rules. Misunderstanding can arise between the parties if they are of different
nationalities and come from different jurisdictions. This can cause unnecessary delay. The
absence of cooperation among parties may frustrate the parties’ intention of resolving their
dispute by ad hoc arbitration. Such situations can be avoided, if the parties agree that the
arbitration should be conducted under certain arbitration rules. This results in reduced
deliberation and legal fees and also facilitates early commencement of the arbitration, as the
parties do not engage in the time consuming process of determining complex arbitration rules.
There are various sets of rules suitable to ad hoc arbitration, of which the UNCITRAL rules
are considered most suitable.
Because of its flexibility, an ad hoc arbitration is preferred in cases involving state
parties who consider that a submission to institutional arbitration devalues their sovereignty
and they are therefore reluctant to submit to institutional control. It helps to shape the arbitration
in a manner, which enables quick and effective resolution of disputes involving huge sums of
public money and public interest.
 Institutional Arbitration
94
An institutional arbitration is one in which a specialized institution with a
permanent character intervenes and assumes the functions of aiding and administering the
arbitral process, as according to the rules of that institution. It should be noted that these
institutions do not arbitrate the dispute, but it is the arbitrators who arbitrate. Therefore the
term arbitral institution is inappropriate and only the rules of the institution apply. There is
an arbitration clause in a contract which designates an institution as the arbitration
administrator. But there are certain drawbacks of these institutions. They charge a very high
administrative fees for services and use of facilities, especially where fees are related to the
amount in dispute. For lesser amount in dispute, institutional fees may be greater than the
amount in controversy. Also the institutional bureaucracies may lead to added costs and
delays the disputants may be required to respond within unrealistic time frames.
The first issue in an institutional arbitration is the choice of the institution, appropriate
for the resolution of disputes, arising out of their contract. Various factors should be considered
while making this choice. The nature and commercial value of the disputes, the rules of the
institution as these rules differ, past record and reputation of the institution and also that the
institutional rules are in tune with the latest developments in international commercial
arbitration practice.
The arbitral institution should be selected very carefully. There are approximately
1,200 institutions, organizations and businesses worldwide offering institutional arbitral
services. Some are excellent. Some are not as good. Some are bad. Many arbitral institutions
are operating under rules not artfully drawn or rules which may be applicable to a particular
trade or industry, but not to the existing or prospective needs of one or more of the parties. The
greatest threat presented by the less prestigious arbitral institutions is the possibility that the
institutional provider will be unable to deliver what motivated the parties to select institutional
arbitration over ad hoc proceedings, i.e., a proper degree of supervision, which often is the key
to whether the arbitration will prove successful.
There are many benefits of an institutional arbitration. They are as follows:
(i)availability of pre-established rules and procedures which assure that arbitration will get off
95
the ground and proceed to conclusion with dispatch;
(ii) administrative assistance from institutions providing a secretariat or court of arbitration;
(iii) lists of qualified arbitrators, often broken out by fields of expertise;
(iv) appointment of arbitrators by the institution should the parties request it;
(v) physical facilities and support services for arbitrations;
(v) assistance in encouraging reluctant parties to proceed with arbitration and
(vi) established format with a proven record.
A major advantage of institutional arbitration is that it saves the parties and their
lawyers the effort of determining the arbitration procedure and also the effort of drafting an
arbitration clause, which is provided by the institution. Once the institution is decided, the
parties need to include an arbitration clause of that institution into their contract. This shows
the intention of the parties to arbitrate under the institution’s rules. The arbitration clause is
also periodically revised by the institution. In this type, the arbitrators are chosen by the parties
from the institution’s panel of arbitrators. This panel includes expert arbitrators from different
regions of the World. The parties can also get help from the institutional staff, responsible for
administering international commercial arbitrations under the institutional rules.
In an ad hoc arbitration, the parties are the masters of the arbitration whereas in
an institutional arbitration, the institutions virtually acquire certain powers of the parties’ such
as appointment of arbitrators etc.. they can impose their will upon the parties. This is against
the very spirit of arbitration and it is not arbitration in true sense. Though ad hoc arbitration
would then be preferred, it can be argued that in today's modern and complex commercial
world, ad hoc arbitration is suitable only to disputes involving smaller claims and less affluent
parties and to domestic arbitrations, excepting where state parties are involved, for the reasons
stated hereinabove.
 Fast track Arbitration
The Amendment Act of the Arbitration and Conciliation has added Section 29B
which provides for fast track arbitration. This concept was introduced to speed up the
arbitration process. Here the arbitral tribunal has to make an award within a period of 6 months
from the date of reference of the dispute to the arbitration tribunal. The arbitral tribunal can
decide the dispute in accordance with written pleadings, documents and submissions filed by
the parties without any oral hearing, unless the parties request for oral hearing or if the tribunal
considers it necessary for clarifying the issues pertaining to the arbitration process.
96
Under the new section, the parties have a choice to select fast track procedure, even
if they do not wish to subject their arbitration to any institutional rules. At the time of forming
the arbitration agreement, the parties can choose fast track procedure. They can also choose it
at any stage before or at the time of appointment of an arbitral tribunal. This procedure can also
apply to existing disputes if the parties mutually agree to apply this procedure. In this
procedure, the parties can choose a sole arbitrator to act as an arbitral tribunal. The most
optimized plan of attack assertion technique gets rid of the requirement for oral hearing since
the debate is settled based on composed pleadings, archives and entries recorded by the
particular gatherings. Be that as it may, the need of oral pleadings isn't totally annihilated in
quick track procedures since it might be held in line with the gatherings or on the off chance
that it is viewed as vital by the court to clear up specific issues. It is totally at the watchfulness
of the council to apportion any further specialized customs and embrace any such technique
that is reasonable for the speedy transfer of the contest. It is given that the discretion grant will
be made inside a half year from the date the arbitral court enters upon the reference. In the
event that, the court neglects to make an honor inside a half year, the gatherings can surpass
the timespan commonly to an extra time of a half year. Further, if the honor isn't set aside a
few minutes time span, the order of the council will naturally end and any extra augmentation
must be allowed by the court on adequate reason being appeared on such terms and conditions
as might be forced.
In spite of the fact that the correction Act under Sec. 11(14) has endorsed the
charges of mediators in the fourth Schedule, on account of quick track intervention, the
expenses and the way of instalment of expenses will be as concurred by the gatherings. Quick
track methods for contest goals were accessible in Institutional Arbitrations since long. These
have been gainful in situations where a minor debate hosts sprung up or where gatherings
don't need the procedure to be exceptionally long. Principle 9A of the LCIA Arbitration
Rules 2014 and Rule 5 of the SIAC Rules, 2016 accommodate a sped-up method of
Arbitration so as to determine the question. In India likewise, mediation foundations like
Delhi International Arbitration Centre and the recently settled Mumbai Centre for
International Arbitration have joined arrangements in their Rules that take into account
gatherings to choose quick track strategy.
The process of fast track arbitration is still new in India and needs to be
actively practised to lessen the burden on the judicial system. By introduction of fast-track
procedure in the Arbitration Act itself, fast track process has been granted statutory
recognition and this will go a long way in legitimising and making fast track procedure an
accepted mode of dispute resolution.
97
 Mediation
Mediation is a procedure where the middle person, an outside individual,

nonpartisan to the debate, works with the gatherings to discover an answer which is worthy to
all of them. The essential thought process of intercession is to furnish the gatherings with a
chance to arrange, banter and investigate choices helped by an impartial outsider, to
comprehensively decide whether a settlement is possible. .Mediation is exchange done with
the help of an outsider. The arbiter, as opposed to the mediator or judge, has no capacity to
force a result on questioning gatherings. Regardless of the absence of 'teeth' in the
intercession procedure, the contribution of a go between modifies the elements of
negotiations. The idea of Mediation isn't unfamiliar to Indian legitimate framework, as there
existed, various parts of intercession. The Village Panchayats and the Nyaya Panchayats are
genuine models for this. A short scrutiny of the laws relating to intervention features that it
has been to a great extent kept to business exchanges. The Arbitration and Conciliation Act,
1996 is encircled in such a way, that it is concerned primarily with business exchanges that
includes the basic man as opposed to the regular man's advantage. In India, Mediation has not
yet been well known. One reason for this is intercession is anything but a formal continuing
and it can't be upheld by official courtrooms. There is an absence of activity with respect to
the legislature or some other establishments to take up the reason for urging and spreading
attention to the general population on the loose.
 Conciliation
Conciliation is "a procedure where an impartial individual meet with the gatherings to
a debate which may be settled; a generally unstructured technique for contest goals
wherein an outsider encourages correspondence between gatherings trying to enable
them to settle their differences". This comprises in an endeavour by an outsider,
assigned by the disputants, to accommodate them either before they resort to case
(regardless of whether to court or assertion), or after. The endeavour to assuage is
commonly founded on appearing side the opposite parts of the question, so as to unite
each side and to come to a solution. Segment 61 of the 1996 Act accommodates
mollification of questions emerging out of legitimate relationship, regardless of
whether legally binding or not and to all procedures relating thereto. After its
establishment, there can be no complaint, for not allowing the gatherings to go into a
pacification understanding in regards to the settlement of even future debates. There is
98
an unobtrusive distinction among intercession and appeasement. While in reflection,
the outsider, impartial delegate, named as middle person assumes progressively
dynamic job by giving autonomous trade off equations in the wake of hearing both the
gatherings; in mollification, the third nonpartisan go-between's job, is to unite the
gatherings in an outlook to overlook their enmities and be set up for a satisfactory trade
off on terms halfway between the stands taken before the beginning of appeasement
proceedings.
 Negotiation
Exchange correspondence with the end goal of influence is the pre-prominent method
of question goals. Contrasted with procedures utilizing shared outsiders, it hosts the
benefit of enabling the gatherings themselves to control the procedure and the solution.
Basics of Negotiation are:
(i) It is a correspondence procedure;

(ii) It settles clashes;
(iii) It is an intentional exercise;
(iv) It is a non-restricting procedure;
(v) Gatherings hold command over result and strategy;
There is a probability of accomplishing wide running arrangements,
and of expanding joint gains. In India, Negotiation doesn't have any statutory
acknowledgment. Exchange is self-guiding between the gatherings to determine their
question. Exchange is a procedure that has no fixed guidelines yet pursues an
anticipated example.
Lok Adalats
Lok Adalat was a memorable need in a nation like India where absence of education
ruled different parts of administration. It was presented in 1982 and the first Lok Adalat
was started in Gujarat. The development of this development was a piece of the
technique to diminish substantial weight on courts with pending cases. It was the
aggregation of ideas of social equity, rapid equity, appeased result and arranging
endeavours.
99
They provide food the need of more fragile segments of society. It is a reasonable
elective instrument to determine debates instead of prosecution. Lok Adalat’s have
expected statutory acknowledgment under the Legal Services Authorities Act, 1987.
These are by and large normally sorted out basically by the State Legal Aid and the
Advice Boards with the assistance of District Legal Aid and Advice Committees.[34]
Lawful Services Authorities Act, 1987:
The Legal Services Authorities Act, 1987 was brought into power on 19 November
1995. The object of the Act was to give free and skilful legitimate administrations to
the more fragile areas of the general public to guarantee that open doors for verifying
equity are not denied to any native. The idea of legitimate administrations which
incorporates Lok Adalat is a progressive development of goals of questions.
Despite the fact that settlements were influenced by directing Lok Nyayalayas
preceding this Act, the equivalent has not been given any statutory acknowledgment.
In any case, under the new Act, a settlement touched base at in the Lok Adalats has
been given the power of a pronouncement which can be executed through Court as
though it is passed by it. Segments 19, 20, 21 and 22 of the Act manage Lok Adalat.
Area 20 accommodates various circumstances where cases can be alluded for thought
of Lok Adalat.
Good Delhi High court has given a milestone choice featuring the centrality of Lok
Adalat development on account of Abdul Hasan and National Legal Services Authority
v. Delhi Vidyut Board and Others[35]. The court passed the request surrendering
bearings for setting of changeless Lok Adalats.
SUGGESTIONS FOR IMPROVING MECHANISMS
The advancement of ADR instruments was not of that much achievement. In this
manner, the pattern is the inconvenience of obligation and obligation on Court
I)Courts are approved to give mandates for the selection of ADR components by the gatherings and
for that reason Court needs to assume significant job by method for giving direction. Power is
additionally presented upon the courts with the goal that it can mediate in various phases of
procedures. However, these objectives can't be accomplished except if imperative framework is
given and institutional casing work is put to put.
ii) The institutional system must be realized at three phases, which are:
100
Mindfulness: It can be achieved by holding courses, workshops, and so forth. ADR proficiency
program must be accomplished for mass mindfulness and mindfulness camp ought to be to change
the attitude of every single concerned disputant, the legal advisors and judges.
Acknowledgment: in such manner preparing of the ADR specialists ought to be made by some
University together with different foundations. Broad preparing would likewise be important to be
granted to the individuals who plan to go about as a facilitator, middle people, and conciliators.
Granting of preparing ought to be made a piece of proceeding with training on various features of
ADR so far as legal officers and judges are concerned.
Execution: For this reason, legal officers must be prepared to recognize cases which would be
appropriate for taking plan of action to a specific type of ADR. [36]
iii) ADR Mechanisms to be made progressively reasonable: The inflow of cases can't
be halted on the grounds that the entryways of equity can't be shut. In any case, there is a desperate
need to build the outpouring either by reinforcing the limit of the current framework or by method
for discovering some extra outlets.
iv)Setting up of Mediation Centres in all locale of each state so as to intervene all questions
will realize a significant change in the Indian Legal framework. These Mediation focuses would work
with a proficient group of go between who are chosen from the neighbourhood network itself.
v) Not numerous Indians can manage the cost of prosecution. This sort of situation
makes average folks, particularly country individuals, sceptical about legal procedure. We should
take the ADR system past the urban areas. Gram Nyayalayas should process 60 to 70 percent of
provincial prosecution leaving the normal courts to give their opportunity to complex common and
criminal issues.
101
vi) More and more ADR focuses ought to be made for settling debates out-of-court. ADR strategies
will accomplish the goal of rendering social equity to the general population, which is the objective
of an effective legal system.
vii) The real lacuna in ADR is that it isn't authoritative. One could even now bid against the honour or
postpone the usage of the honour. "Equity deferred is equity denied." The very embodiment of ADR
is lost in the event that it isn't actualized in the genuine soul. The honour ought to be made official
on the gatherings and no intrigue to the court should be permitted except if it is touched base at
falsely or on the off chance that it against open policy.
CONCLUSION
With the advent of the alternate dispute resolution, there is new avenue for the
people to settle their disputes. The settlement of disputes in Lok Adalat quickly has acquired
good popularity among the public and this has really given rise to a new force to ADR and this
will no doubt reduce the pendency in law Courts. There is an urgent need for justice
dispensation through ADR mechanisms.
The ADR movement needs to be carried forward with greater speed. This will considerably
reduce the load on the courts apart from providing instant justice at the door-step, without
substantial cost being involved. If they are successfully given effect then it will really achieve
the goal of rendering social justice to the parties to the dispute.
102
BIBLIOGRAPHY
https://en.wikipedia.org/wiki/Dispute_mechanism
https://en.wikipedia.org/wiki/Alternative_dispute_resolution
https://en.wikipedia.org/wiki/United_Nations_Commission_on_International_Trade_Law
https://uncitral.un.org/sites/uncitral.un.org/files/media-documents/uncitral/en/12-57491-guide-to-
uncitral-e.pdf
https://uncitral.un.org/sites/uncitral.un.org/files/media-documents/uncitral/en/12-57491-guide-to-
uncitral-e.pdf
https://en.wikipedia.org/wiki/UNCITRAL_Model_Law_on_International_Commercial_Arbitration
https://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/07-86998_Ebook.pdf
https://uncitral.un.org/en/texts/arbitration/contractualtexts/arbitration
https://www.uncitral.org/pdf/english/texts/arbitration/ml-arb/07-86998_Ebook.pdf
103

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A STUDY ON THE IMPACT OF UNCITRAL

MODEL OF DISPUTE RESOLUTION IN INDIAN

Under the Guidance and Supervision of

Ms. Swati Mohapatra

SOA NATIONAL INSTITUTE OF LAW (SNIL)

SL. NO CONTENTS PAGE

Soa National Institute of Law (SNIL)

It gave me an immense pleasure to write a preface of my Research Work titled “A STUDY

I. Gas Authority of India v M/S Keti Constructions (I) Ltd.

INTRODUCTION AND REVIEW OF LITERATURE

What is Dispute Resolution Mechanism?

A dispute mechanism is a structured process that addresses disputes or

UNCITRAL Model Law On International Commercial

I. Inadequacy of domestic laws of arbitration

II. Disparity between National Laws of Arbitration

The national laws on assertion vary generally. They contrast from

Salient Features of the UNCITRAL Model Law on International

The salient features of the UNCITRAL Model Law on International Commercial

I. Scope of Application of the Model Law

Article 1 of the UNCITRAL Model Law on International Commercial Arbitration

Chapter II if the UNCITRAL Model Law on International Commercial

Composition of Arbitral Tribunal

Jurisdiction of Arbitral Tribunal

Chapter IV of the UNCITRAL Model Law on International Commercial

Conduct of Arbitral Proceedings

Chapter V of the UNCITRAL Model Law on International Commercial

Making of Award and Termination of Proceedings

Recourse Against Award

Chapter VII of the UNCITRAL Model Law on International Commercial

Recognition and Enforcement of Awards

Chapter VIII of the UNCITRAL Model Law on International Commercial

UNCITRAL Model Law on International Commercial

Modes and Practices of ADR in India

ADR can be broadly classified into two categories : Court-annexed

Arbitration implies any mediation whether regulated by a perpetual arbitral

The various sorts of arbitration are as per the following:

(i) Ad Hoc Arbitration

(ii) Institutional Arbitration

An institutional arbitration is one in which a particular organization with a changeless character

(iii) Fastrack Arbitration

Fastrack Arbitration is a period bound discretion, with stricter guidelines of

The Arbitration and Conciliation Act,1996

UNCITRAL Model Law and the Arbitration and Conciliation

Indian Council of Arbitration

In India, the Indian Council of Arbitration established in 1965 is the apex

Statement of the Problem

Present research problem relates to the tracing of vicissitudes of judicial

Significance of the Study

The hypothesis which is formulated in the beginning of the study are :

The UNCITRAL Model Law on International Commercial

The UNCITRAL Model Law on International Commercial

The UNCITRAL Model Law on International Commercial Arbitration

The UNCITRAL Model Law on International Commercial

Paragraph 3 of Article 1 provides the definition of conciliation. This definition

Broad notion of Conciliation

The words “whether referred to by the expression conciliation, mediation, or an

Opting out of Model Law

Interpretation of the Model Law

General Principles upon which the Model Law is based

Paragraph 2 of Article 2 states that, where a question is not settled by Model

Article 4 addresses the question of when a conciliation proceeding can be

Methods by which parties may agree to engage in conciliation

Time period for accepting an invitation to conciliate

Unlike in international commercial arbitration where the default rule is often 3