Arbitration in India

The Significance of Arbitration and ADR Today

Arbitration today is the default setting for commercial dispute resolution in India. Initially finding favour with foreign parties reluctant to submit to Indian court jurisdiction owing to the endemic delays in the Indian legal system and perceived interference, it was not long before Indian parties also realised the benefits of a simpler and quicker way of resolving their disputes. Indeed, the Indian Government also recognised that increasing efficiencies in arbitration and the enforcement process, was a mechanism to ratchet it up World Bank rankings for Doing Business.

In the ‘World Bank Report on Doing Business 2018’, India’s ranking for ‘Enforcing Contracts’, improved several positions, i.e. from 172 in 2016, to 164 in 2017 , and 163 in 2019. Insofar as general ease of doing business is concerned, India jumped 23 places from 2018, to a ranking of 77 in 2019.

Section 9 - Interim measures etc. by Court

1. A party may, before, or during arbitral proceedings or at any time after the making of the arbitral award but before it is enforced in accordance with section 36, apply to a court-

(i) for the appointment of a guardian for a minor or person of unsound mind for the purposes of arbitral proceedings; or

(ii) for an interim measure or protection in respect of any of the following matters, namely:-

(a) the preservation, interim custody or sale of any goods which are the subject-matter of the arbitration agreement;

(b) securing the amount in dispute in the arbitration;

(c) the detention, preservation or inspection of any property or thing which is the subject-matter of the dispute in arbitration, or as to which any question may arise therein and authorising for any of the aforesaid purposes any person to enter upon any land or building in the possession of any party, or authorising any samples to be taken or any observation to be made, or experiment to be tried, which may be necessary or expedient for the purpose of obtaining full information or evidence;

(d) interim injunction or the appointment of a receiver;

(e) such other interim measure of protection as may appear to the Court to be just and convenient, and the Court shall have the same power for making orders as it has for the purpose of, and in relation to, any proceedings before it.

2. Where, before the commencement of the arbitral proceedings, a Court passes an order for any interim measure of protection under sub-section (1), the arbitral proceedings shall be commenced within a period of ninety days from the date of such order or within such further time as the Court may determine.

3. Once the arbitral tribunal has been constituted, the Court shall not entertain an application under sub-section (1), unless the Court finds that circumstances exist which may not render the remedy provided under section 17 efficacious.