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THE APPOINTMENT OF ARBITRATORS BY THE CHIEF JUSTICE OF INDIA SCHEME, 1996

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THE APPOINTMENT OF ARBITRATORS BY THE CHIEF JUSTICE OF INDIA SCHEME, 1996
By: Mr. M. GOVINDARAJAN
August 14, 2020
All Articles by: Mr. M. GOVINDARAJAN       View Profile
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Appointment of arbitrators

Section 11 of the Arbitration and Conciliation Act, 1996 provides the procedure for appointment of arbitrators.    A person of any nationality may be an arbitrator, unless otherwise agreed by the parties.  The parties are free to agree on a procedure for appointing the arbitrator or arbitrators. 

Section 11(3) provides that failing any agreement, in arbitration with three arbitrators, each party shall appoint one arbitrator, and the two appointed arbitrators shall appoint the third arbitrator who shall act as the presiding arbitrator. 

Section 11(4) provides that if the appointment procedure in section 11(3) applies and-

  • a party fails to appoint an arbitrator within 30 days from the receipt of a request to do so from the other party; or
  • the two appointed arbitrators fail to agree on the third arbitrator within 30 days from the date of their appointment,

the appointment shall be made, on an application of the party, by the arbitral institution designated by the Supreme Court, in case of international commercial arbitration or by the High Court, in case of arbitrations other than international commercial arbitration.

Section 11(5) provides that failing any agreement, in an arbitration with a sole arbitrator, if the parties fail to agree on the arbitrator within 30 days from receipt of a request by one party from the other party to so agree the appointment shall be made on an application of the party in accordance with the provisions contained in section 11(4).

Section 11(6) provides that where, under an appointment procedure agreed upon by the parties-

  • a party fails to act as required under that procedure; or
  • the parties, or the two appointed arbitrators, fail to reach an agreement expected o them under that procedure; or
  • a person, including an institution, fails to perform any function entrusted to him or it under that procedure,

the appointment shall be made, on an application of the party, by the arbitral institution designated by the Supreme Court, in case of international commercial arbitration, or by the High Court, in case of arbitrations other than international commercial arbitration, to take necessary measure, unless the agreement on the appointment procedure provides other means for securing the appointment.

Power of Supreme Court/High Court

Section 11(10) gives powers to the Supreme Court/High Court to make such scheme to the said Court may deem appropriate dealing with the matters entrusted in section 11(4) or 11(5) or section 11(6).

Scheme

By virtue of power given in section 11(10) of the Act, the Chief Justice of India made a scheme vide S.C.I. Notification, dated 29.01.1996 called as ‘The Appointment of Arbitrators by the Chief Justice of India Scheme, 1996.  This scheme was amended in the years 2002 and  2005.

Procedure

The request to the Chief Justice under section 11(4) or 11(5) or 11(6) shall be made in writing.  The application shall be accompanied by the following-

  • the original arbitration agreement or a duly certified copy thereof;
  • the names and addresses of the parties to the arbitration agreement;
  • the names and addresses of the arbitrators, if any, already appointed;
  • the name and address of the person or institution, if any, to whom or which any function has been entrusted by the parties to the arbitration agreement under the appointment procedure agreed upon by them;
  • the qualifications required, if any, or the arbitrators by the agreement of the parties;
  • a brief written statement describing the general nature of the dispute and the points at issue;
  • the relief or remedy sought; and
  • an affidavit, supported by relevant document, to the effect that the condition to be satisfied under section 11(4) or 11(5) or 11(6) before making the request to the Chief Justice, has been satisfied.

Five additional sets of the request and accompanying documents are also to be submitted. 

On receipt of the application aforesaid, the Chief Justice may either deal with the matter entrusted to him or designate any other person or institution for the purpose.  If the Chief Justice designates any person or institution, he shall have the request along with the documents forwarded to such persons or institution and also have an intimation sent to the parties to the arbitration agreement.

The Chief Justice or the person or the institution designated by him may seek further information or clarification from the party making the request.  The said person shall given such information to the Authority within the time specified in the aforesaid intimation.

If the application does not fulfill the requirements of the scheme, the Chief Justice or the person or the institution designated by him may reject the application.   

If the Chief Justice-

  • on receipt of complaint from either party to the agreement; or
  • is of the opinion

that the person or institution designated by him has neglected or refused to act or is incapable of acting, the Chief Justice may withdraw the Authority given to such person or institution.  The Supreme Court may either deal the case or designate another person or institution for that purpose.

The decision taken by the Chief Justice or the person or institution designated by him, shall be communicated in writing to-

  • the parties to the arbitration agreement;
  • the arbitrators, if any, already appointed by the parties to the parties to the arbitration agreements;
  • the person or the institution to whom any function has been entrusted by the parties to the agreement;
  • the arbitrator appointed in pursuance of the request.

Communication to Registrar

All requests under this scheme and communications shall be presented at the filing counter of Supreme Court by the party or by his duly authorized agent or by an Advocate on Record.  The Registrar shall maintain a separate register of such requests and communications.

Costs

The party making a request under this scheme shall, on receipt of notice of demand from-

  • the Registry of the Court, where the Chief Justice makes the appointment of an arbitrator or takes the necessary measure; or
  • the designated person or the institution,  where such person or institution makes appointment of arbitrator or takes the necessary measure

pay an amount of ₹ 15,000/- towards the costs involved in the proceedings of the request.

Interpretation

If any question arises with reference to interpretation of any of the provisions of this scheme, the question shall be referred to Chief Justice, whose decision shall be final.

Power to amend the scheme

The Chief Justice may, from time to time, amend by way of addition or variation any provision of this scheme.

 

By: Mr. M. GOVINDARAJAN - August 14, 2020

 

 

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