CHAPTER VII OF THE ARBITRATION AND CONCILIATION ACT, 1996: ESTABLISHING FINALITY OF AN AWARD BY PROVIDING INADEQUATE RECOURSE FOR SETTING ASIDE?

Abstract

Immediately after Chapter VII of the Arbitration and Conciliation Act, that provides for a recourse against an arbitral award, is Chapter VIII which is titled, ‘Finality and Enforcement of Arbitral Award’. It is well-known information that one of the major reasons for India to buckle up on its existing Arbitration mechanism in the 1990s was to provide for a more citizenfriendly discourse in solving disputes; not only for speedy justice but also for trying to reduce the enormous backlog of cases in the Indian courts. The 1990s saw rapid globalization and industrialization, especially by India due to changes in its foreign policies, and therefore growth of the country as a whole required its justice system to be strong and reliable.  

For the abovementioned reasons, alternate dispute resolution methods have since then been encouraged. So much so, that its preference over traditional judicial discourse is evident. This statement can be backed by various sections of the Arbitration and Conciliation Act, in particular Section 34. This section seeks to establish the extent of judicial intervention in arbitral awards—and lists down criteria on when they can be set aside by said intervention. On the face of it, this extent granted to the judicial authorities seems limited.i The reason stands clear; the entire process of an arbitration would be redundant if the ultimate decision-making power stood with the court, and the aggrieved would end up in a lengthy judicial process even after going through with an ‘alternate’ dispute resolution method. However, in trying to supersede arbitral awards as all-encompassing with little scope of appeal—how effective would this method be if it is unable to remedy a person approaching it?