The Arbitration and Conciliation Act, 1996

India’s arbitration regime is built on the Arbitration and Conciliation Act, 1996, substantially amended in 2015, 2019 and 2021. It is broadly UNCITRAL-Model-Law-aligned. The Act distinguishes (i) domestic arbitrations seated in India under Part I, (ii) international commercial arbitrations seated in India under Part I with some special provisions, and (iii) enforcement of foreign awards under Part II.

Key procedural touchpoints

Section 8 — civil court must refer parties to arbitration where a valid arbitration agreement exists; Section 9 — interim measures by the court before/during arbitration (most-used pre-arbitration relief); Section 11 — appointment of arbitrator by the Chief Justice / High Court where parties cannot agree; Section 17 — interim measures by the arbitral tribunal once constituted; Section 34 — challenge to the award on narrow grounds; Section 36 — enforcement of the award as a decree.

Drafting arbitration clauses

A good arbitration clause specifies: (i) scope — “any dispute arising out of or in connection with this agreement”; (ii) seat — preferably Kota or Jaipur for Rajasthan-based disputes; (iii) venue if different from seat; (iv) number of arbitrators — sole for value below ₹5 crore, three above; (v) institutional rules — DAC, MCIA, ICA or Delhi International Arbitration Centre; (vi) language — English; (vii) governing law — Indian law of contract; (viii) curial law — Act of 1996. Bad clauses (pathological clauses) are a leading cause of pre-arbitration litigation.

Section 34 challenge

Award challenge under Section 34 is on narrow grounds: incapacity, invalid agreement, lack of due notice, beyond scope, irregular composition, conflict with public policy of India (including patent illegality for domestic awards). Time limit: 3 months from award + 30 days condonable delay. The Supreme Court in Associate Builders v. DDA (2015) 3 SCC 49 and Ssangyong v. NHAI (2019) 15 SCC 131 progressively narrowed the “public policy” challenge.

Enforcement of awards

Section 36 makes an arbitral award enforceable as if it were a decree of the court — no separate execution petition needed for filing. Stay on enforcement requires a separate application under Section 36(3) — the 2021 amendment makes stay automatic where the award is induced by fraud. Foreign awards under Part II are enforceable through Section 47–49 process; “public policy” challenge here is even narrower — Renusagar v. General Electric (1994).