Salient features of Arbitration and Conciliation Act, 1996

The Arbitration and Conciliation Act, 1996 improves upon the previous laws regarding arbitration in India namely the Arbitration Act, 1940, the Arbitration (Protocol and Convention) Act, 1937 and the Foreign Awards (Recognition and Enforcement) Act, 1961.Further, the new statute also covers conciliation which had not been provided for earlier.The Act also derives authority from the UNCITRAL Model law on International Commercial Arbitration and the UNCITRAL rules on conciliation.The Model law on International Commercial Arbitration was framed after taking into consideration provisions regarding arbitration under various legal systems. Thus, it is possible to incorporate the model law into the legal system of practically every nation.The Act of 1996 aims at consolidating the law relating to domestic arbitration, international commercial arbitration, enforcement of foreign arbitral awards and rules regarding conciliation.

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The main objectives of the Act are as follows:

  • To ensure that rules are laid down for international as well as domestic arbitration and conciliation.
  • To ensure that arbitration proceedings are just, fair and effective.
  • To ensure that the arbitral tribunal gives reasons for its award given.
  • To ensure that the arbitral tribunal acts within its jurisdiction.
  • To permit the arbitral tribunal to use methods such as mediation and conciliation during the procedure of arbitration.
  • To minimise the supervisory role of courts.
  • To ensure that an arbitral award is enforceable as a decree of the court.
  • To ensure that the result of conciliation proceedings may be treated as arbitral awards on agreed terms.
  • To treat awards given in a foreign country to which any one of the two international conventions apply as followed by India as being a foreign arbitral award.

Part I relates to domestic arbitration, Part II relates to enforcement of certain foreign awards, Part III provides for conciliation and Part IV contains certain supplemental provisions.

Part I may be applied only where the seat/place of arbitration is in India except where a particular law provides that the dispute cannot be submitted for arbitration.

Post Contributed By:

Abhishek Bhargava

Indian Institute of Legal Studies

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