On 12 February 2021, the lower house of the Indian pa rliament, the Lok Sabha, passed the Arbitration and Conciliation (Amend ment) Bill, 2021 (Bill 16 of 2021) (the “”Bill”) by voice vote. The Bill was introd uced to amend the Arbitration and Conciliation Act 1996 (the “Act”) in an aim to: i. address the issue of corrupt practices in securing contracts or arbitral awards;and ii. promote India as a hub of international commercial arbitration. To give effect to the first objective, the Bill seeks to insert a proviso to Section 36 of the Act whereby if the adjudicating Court is satisfied that a prim afacie case is made out that the arbitration agreement or contract which is the basis of the award, or the making of the arbitral award was induced by fraud or corruption, an unconditional stay on the operation of the award shall be granted till the disposal of proceedings under Section 34 of the Act seeking to aside the award. Once the Bill is enacted, the proposed amendment will apply to all related proceedings that have commenced on or after 23 October 2015. To achieve the second objective, the Bill seeks to omit the Eighth Schedule of the Act. The Eighth Schedule lays down certain qualifications, experience and norms that need to be complied with for being eligible to be appointed as an arbitrator. Section 43J of the Act that currently states that “qualifications, experience and norms of accreditation of arbitrators shall be such as specified in the Eighth Schedule” has been proposed to now read as “The qualifications, experience and norms for accreditation of arbitrators shall be such as may be specified by the regulations.” This suggests that the qualifications of an arbitrator are going to be prescribed by a set of Regulations that would be introd uced by the Government It may be noted that the proposed amendments to the Act are already in force pursuant to the Arbitration and Conciliation (Amendment) Ordinance, 2020 that was promulgated on 4 November 2020. On the enactment of the Bill, the Arbitration and Conciliation (Amendment) Ordinance, 2020 will be repealed.
Decided on 12 July 2022 | Supreme Court of India In Vidarbha Industries Power Ltd. vs Axis Bank Limited, the Supreme Court (“the Court”)