Bharat Ushers in New Age, Calls for Institutionalized Arbitration Mechanism

Paromita Das

GG News Bureau

New Delhi, 7th June. On July 30, 2017, the High Level Committee to Review the Institutionalization of Arbitration Mechanism in Bharat, chaired by retired Supreme Court of India Judge B.N. Srikrishna, released his findings on the necessity of institutionalizing arbitration procedures in Bharat. After carefully reviewing the findings, the Bharatiya government amended the Arbitration and Conciliation Act of 1996. These changes have not yet been communicated to the public in order for them to take effect.

The Arbitration and Conciliation Act 1996 was amended in 2019 and 2022 by the Government of India, ushering in a new age for the arbitration system in Bharat. Prior to this, arbitration was restricted to individual choices and courts. Traditionally, elders have arbitrated disagreements within communities and among families. Only a small number of disputes were settled by monarchs or other official resolution of disputes mechanisms in medieval civilizations. Modern courts, or formal judicial institutions, developed in tandem with democracies and other broadly recognized forms of government. This rule applies to Bharat as well. Bureaucratic procedures hinder access to justice as the rights-based approach to justice delivery gains hold on a global basis.

Politicians are thinking about bolstering alternative dispute resolution (ADR) methods due to the mounting weight of over 4.9 crore cases that are still waiting in Bharatiya courts. The arbitration centers could now professionally handle cases directly from disputants without intervention or court referral, thanks to the institutionalization of arbitration, which was predicted to bring about a paradigm shift in Bharatiya arbitration law. The inclusion of an arbitration clause in the parties’ contracts or their mutual agreement to arbitrate is the only prerequisite for these institutions to hear a dispute. The only international arbitration facility in Bharat, the International facility for Alternative Dispute Resolution (ICADR), is governed by the Supreme Court and the Government of India. The Justice Srikrishna committee looked into the ICADR’s functioning. With its main office located in New Delhi and regional offices in Bengaluru and Hyderabad, this was Bharat’s first International Arbitration Center.

In order to support and facilitate alternative dispute resolution techniques, the Bharatiya government’s Ministry of Law and Justice founded the ICADR in 1995. This was a component of a bigger plan to speed up the resolution of disputes and lighten the load on the legal system. The ICADR is an independent society that is registered with the SRA. Nobody in the nation is aware of ICADR, and it’s not clear if it perished naturally or was choked out by for-profit organizations. Under any binding contract, parties have the option to contest the performance or non-performance of agreed-upon activities by arbitration, and more especially through institutional arbitration. If arbitration is specified in a contract as a method of resolving disputes, then issues involving property, money, partnerships, franchises, construction, and any other kind of commercial or business conflicts may be arbitrated.

During the process, the arbitration institutions uphold total confidentiality. Instead of going to court, small and medium-sized enterprises, the construction sector, civil contractors, families dividing property among siblings, and others with cases that can be arbitrated can walk into the offices of Arbitration Institutions and file their cases for arbitration without the help of attorneys or advocates. Time, money, and relationships are all preserved via arbitration. Although there has been a lot of discussion about institutionalizing arbitration through workshops, seminars, and arbitration weeks—and even Bharat’s honorable Vice President has said that arbitration is turning into an “old boys club”—the Act was revised so quickly that its effects are not felt in practice. A request made under Section 11(3A) of the Act for the High Courts and Supreme Court to designate Arbitration Institutions has not been fulfilled, and the applications of the Arbitration Institutions are still waiting in the High Courts for unclear reasons.

The much-awaited Arbitration Council of India, which was supposed to authorize and oversee arbitration institutions, is still not up and running four years after the law was passed. State governments don’t sponsor other professionally created arbitration institutions, with the exception of a select few established and financed by renowned law firms. In order to lessen the much-discussed load on courts and establish Bharat as a center for alternative dispute resolution, the Center and all High Courts in the nation must immediately take note of the arbitration institutions that are operating in each state and designate them as such.