S.

M Law College 13

ARBITRATION
NOTES
By HINA MUZAMMIL

[Type the author name]

 Section No. 7: Provision in the case of insolvency.

(1) This relates to those arbitration clauses that refer future disputes to arbitration
which are contained in contracts entered into by an insolvent either before or after
the commencement of insolvency proceeding but before the order of adjudication.
So if any differences arises out of or in-connection with that contract and of the
receiver adopts the contract the arbitration clause will be enforced by or on against
him/her to the extent that it relates to the differences that have risen. However, if
the receiver. Does not adopt the contract then this subsection will not apply.

(2) This includes agreements to referred to arbitration those disputes that have already
arisen. It the receiver does not adopt the contact or if the agreement was to
referred to arbitration and existing dispute the agreement would be enforceable by
or against the receiver only with the permission of the insolvency court. In such
cases, the arbitration agreement will be enforced if.

a) It was arise at before the commencement of the insolvency

proceeding.

b) Any mater to which it relates is required to be determined in

connection with or for the purpose of the insolvency proceedings.

c) The court having regard to all the circumstances of the case

considers that the matter ought to be determining by arbitration.
 Section 8 Power of court to appoint Arbitrator (s) Or Umpire:

Section 8 (i)(a)

Makes provision for those cases where the arbitration(s) as to be appointed by all the parties
jointly but do not agree between themselves. It will not apply where the arbitrator(s) are to be
appointed separately by the parties. The court proves do not arise until difference have risen
between the parties and it is for to courts to decide whether infect difference have risen or
not.

(i)(b): Makes provision for filling up vacancies in the form of arbitrator(s) or an umpire. It
will apply on the following conditions were satisfied.

i. an Umpire or arbitrator must have already been appointed. This clause will not apply for
the making the appointment of an umpire or arbitrator

ii. the arbitrator or an umpire appointed must have neglected to act, refused to act, become
incapable of acting or died.

iii. the arbitrator must not suggest that the money should be filled up. It is immaterial, if there
is no specific provision in it for the money.

Conclusion:

All three conditions must be satisfied and if the parties or arbitrator filed to fill up the
vacancy by any of the parties in the arbitration authorizing only a particular party to appoint
arbitrator(s) could not take away the jurisdiction of the court to exercise this power.

(i)(c): Makes provision for cases in which the umpire is required to be appointed by the
parties or the arbitration but has not been appointed. Therefore, while clause (A) applies to
original appointment of Arbitration. This clause applies to original appointment of an umpire.
It also applies to cases where the two arbitrator (one appointed by each party required) to
appoint the third arbitrator ( who will obviously the umpire here) where the arbitrators filed
to appoint an umpire and parties do not follow the procedure described by Section 8 (i)(c) and
sub-section 2, but appeared before the arbitrators and produced their evidence. they must be
deemed to have waved the irregularities and cannot object latter.

Refusal to act need not be expressed in words & may be implied form an arbitration or
umpire conduct. When he/she fails to submit award without stipulated time. It was always
depend on the specific circumstances of each individual case. e.g.: An arbitrator, who
hesitates to acts without the order of the court, cannot be set to refuse to act.
 SECTION 11

Any act which is contrary to natural justice. It is not necessary to prove some
sort of corruption r fraud or particularly on the fact of Arbitration. It is enough
to prove physical or mental weakness or even errors or irregularities in the
conduct of the reference. It will be misconduct if his/her action are oppressed to
all rational and reasonable principal that should given in the procedure of any
person who is called upon to decide question of difference referred to her/him
by the parties. The onus to prove is lies on the alleging party and it will be
decided from the facts of the entire proceeding before the arbitrator.

An arbitrator or an umpire will be guilty of misconduct if he/she takes no

evidence on the matter referred to them. Has not allowed the party and an
opportunity to prove his/her case, not postponing a meeting for the purpose
allowing a party to get council (Lawyer). Favoring one party more than the
other by doing something for same party but not the other. As a general rule
arbitrator or an umpire have greater latitude or flexibility then courts because
they are not familiar or a part of legal profession. They may make mistake and
so minute irregularities must not be instituted upon. There are however some
principles of justice which are impossible to disregard. And arbitrator or an
umpire can be guilty or misconduct after being called on to act but before
entering in the reference. During the reference in making the award.
 SECTION 13 (B)

Gives the arbitrators authority either to

(1) Refer to the court any question of law for its opinion.
(2) To state the award itself in the form of a special case.

In the former, the arbitrator will proceed with the arbitration after he has received the
opinion of the court on the question of law while in the later case the court will give its
opinion on the question of law while in the later case the question of law involved
therefore completing the award.

In starting an award in the form of Special case the arbitrator should so state the facts and
formulate the question of the law so that when the court had given its decision of these
questions the final result and effect of the award can be determined. If the award is in
such a form that after the decision of the court on the question of law submitted for its
opinion has been given the matter was to back to the arbitration in order that he may
make his final decision it is really no more than a special case stated by the arbitrator
pending the reference and will be so regarded by the court in either case the power should
be exercise before the award is delivered.

An example of (2) above is where the arbitrator has decided the matter before him but
before making the final award he wants to know whether he has power to award interest
as a result. He refers only the question of law or interest to the court which will decide the
matter by saying yes or no and there completing the award without further input by the
arbitrator. While stating a special case it is not necessary for the arbitrator to express his
own opinion and the question of law involved. The facts on which the question of law is
referred to should found by the arbitrator who is starting the case. It is not open to the
court to decide question of fact. The court has no power to enforce is rulings or directions
upon the arbitrator if they do not choose to follow them.

Another difference between 1 and 2 is that under the latter the arbitrator has his power
and has made his award in such a shape that the decision of the court will determine the
right of the parties and turn the award one way or to another and therefore the opinion of
the court for his guidance and as a step for arising at his own ultimate award.

The arbitrators have discretion whether or not to use the power under the sub sec and they
cannot be compelled to do so they may refuse to sate a special case for the point of the
court and the decision the point of law himself and this refusal does not amount to
misconduct.
Section 13 (C) Allows an arbitrator to make a conditional award whereby it would apply on
the carrying out of a certain act by either one or both parties for example an arbitrator who is
empower to decide whether a sale should be set aside may pass an award to set aside a sale
on the condition that the buyer repays the purchase money.

(Alteration) an award to an alternative may also be given if it is sufficient to certain and final.
A if an award directs one or 2 things to be done and one of them is uncertain or impossible
the award is nevertheless sufficiently certain and final if the second alternative is certain and
possible.
 SECTION 14: AWARD TO BE SIGNED AND FILED:-

1) Award made signed fee and charges payable if charges too much can go
to court. Arbitrator must mention charges and fee otherwise uncertainly
can file a suit for recovery. Arbitrator without intervention of court award
must be stamped.

2) The arbitrators or the umpires are bound to file in the court.

i) The award itself or assigned copy of the same.

ii) Depositions if any which may have been reduced to writing by
them
iii) All documents produced and produced before them.

The arbitrator umpireabitrator or umpire may be required to file the

award and the documents

1. At the request of
a) Either party,or
b) Any person claiming under such party.

2. At the direction of the court.

Before filling the papers however the arbitrators or umpire may insist
upon the payment to them of
(1) All fees and charges due inspect of the arbitration and award and
(2) Costs and charges of filing the award in court.

This sub section applies only where the help of the court is sought for getting
the award filed in to the court by calling upon the arbitrators to do it. It cannot
apply to case where the award already in court and there is nothing which the
arbitrators can do further. The award must be filed so the Award must be filed
so that the court can pass a decree. There is nothing in this section to preclude
the arbitrator from filling the award to suo-moto hence it is not correct to say
that the only parties to the arbitration should make an application for filling of
the award under Sec 14 (2) is necessary before an application for setting aside
an award under section 30 can be made.

The words if so directed by the enable party to seek the help of the court if the
arbitration fails to file the award at his request.
This sub section specifically provides that the award shall be filled upon
payment of the fee charges as well as cost of filling. Until such payment is made
the arbitrator or umpire may not file the award and there is no provision in the
act by which the arbitrator or umpire can be compelled to do so unless amount
of fee is challenged as being -------------- under Sec 30 sub (1)

An arbitrator or umpire is not required to keep record of the proceedings or any

inquires he is under no obligation to reduce the evidence produced before in
into writing. All that is required is that he should make an award in writing.
However if he does take down evidence then the statements as well as
documents received by him in evidence should be filled in court along with the
award. Failure to do so is a mere irregularity and will not invalidate the award.
If the arbitrator fails to do so the court may order him to file then in court.

After the arbitrators have delivered the reward. Their functions came to an end
and they have no power to alter, amend or substitutive the award unless it is
remitted by the court. A Valid award operates to extinguish all claims of the
reference and once it has been published, the award will be the only bases by
which the rights of the parties can be determined.

As soon as the award is filed the court shall issue notice to the parties informing
without this no decree can be passed by the court on the bases of the award.

The award must be filled in a civil court having jurisdiction to decide the
question forming the subject matter of the reference if the same have been the
subject matter of the suit.

3 where the arbitrators or umpires sates a special case for the opinion of the
court under the sec 13 (b) the court shall

. Give notice of the same to the parties.

. Pronounce its opinion there on

. The opinion of the court so pronounced id to be added to and form part of the
award.
 SECTION 15: POWER OF COURT TO MODIFY THE AWARD.

(a) Modification and corrections of the award must be confined to the Section and if the
court goes beyond that and makes substantial modification because it takes a different
view from that held by he arbitration as to what is just and fair it acts without
functions this is due to the principle that since the parties by consent choose their own
arbitrator to settle the dispute outside the court, they are now bound by the decision on
questions of fact and law and so cannot easily get it modify.
This section deals with cases when arbitrators is making their award have gave
outside the legitimate subject matters of the reference this is because the authority of
arbitrators is limited to matters lawfully submitted to them its amount to misconduct
on the part of the arbitrators if they adjudicate upon the right of the persons who are
not parties before them or upon the subject matter not referred to the arbitrator.
Therefore where a part of an award is formed to be invalid as being excess maintained
and acted upon while the excessive part can be declared unenforceable so here the
court may modify or correct an award.
For example where the awards erroneously granted for the period prior to the
award, it was held that this question of interest was separable form the rest and not
maternal for the decision of the matter for rather merely consequential, hence, it could
be stuck off under the subsection where an arbitrator includes as an award points
which are outside the arbitration agreement and such points not acceptable from the
rest of the award then the award is void and unenforceable because the decision is
based on a clear misapprehension. When the award include a matter which is not
referred or arbitration and this matter cannot be separated without effecting the award
to the award may be remitted to the arbitrator or umpire for reconsideration under sec
16 (1)

(b) The only power the court has here is to amend any obvious ever which can be
amended without effecting the decision it has no power to enter into the merits to the
dispute under this clause if the imperfection informed or error cannot be amended
without effecting the decision of the arbitration the award my be remitted under Sec
16 or set aside under section 30 otherwise the award will stand as it is e.g in the
mortgage suit referred to arbitration the arbitrator did not allow interest on same
found due, the elegant mistake is not such as would entitle the plaintiff to treat the
award as nullity sec there the mistake is one which might be rectified by this
application under this section.

(c) This includes a fundamental inconsistency such as a contradiction in measurement or

a mistake arithmetical calculation mistakes or even send it back to the umpire under
section 13 sub section (B). An appeal may lay against and order modifying or
correcting an award under section 39.
 SECTION 16: POWER OF THE COURT TO REMIT THE AWARD.

Sub Sec 1 (a):- ground when the award leads any matter undetermined.

 When the award determines any matter not referred to arbitration and such matter cannot
be separated without effecting the determination of the matter referred

 The first ground is provided because award will not be valid unless it decides all the
points referred to an arbitration where the award cause any of the points and controversy
undecided or one party but has adjudicate on the claims of other parties then the award
should be remitted however an award is not to be considered as incomplete merely
because the arbitration have not given an decision on the whole matter in issue between
all the parties is enough.

 The second ground must be contrast sec 15 Sub (a) which provides that where matters
contained an award are not referred to arbitration and such matters are capable of being
separated the proper remedy is for the court to modify the award under that provision.
However where matter contained in an award are not referred to arbitration and such
matter are not capable of being separated only then with the court have the power to remit
the award instead of modifying itself.

Sub Sec 1 (b):- An award ought to be certain so that no reasonable doubt can arise upon the
face of it as to the arbitrators meaning or as to the nature extent of the duties it impose on the
parties however first because an expression used in the award is capable or more then are
interpretation doesn’t mean that the award is indefinite or incapable of executive “means
enforceable. Where the arbitrators provide rule for calculating the amount due without
mentions the actual amount, the award is sufficiently certain if the actual result can be
worked out. The principle is “That is sufficiently certain which can be made certain.

Sub Sec 1 (C):- An Arbitrators is entitled to decide the dispute between the parties on his own
views whether right or wrong and he need not follow the ordinary accepted views of the law
on the subject. However he must not lay down an erroneous preposition of law as being true
preposition of law and proceed to decide the right of the parties on the bases of this erroneous
preposition of law. If he does so then the award may be illegal on its face. However where an
arbitrator has applied his mind honestly and has arrived at a decision to the best of his ability,
the fact a judge may take a different view in not a ground for holding that the award is illegal
on its face. The court must take the award on its face value and should not read into the award
words which are not there and the draw inferences from them.

Therefore for the court to be able to remit an award under the sub sec the illegality
must be one argument and to be obvious on its face and if permitted to pass uncertified would
do unsubstantial justice. This is a very marrow ground and this power must be exercised with
care so that extraneous consideration not appearing on the face of the award is not introduced
for the award. Further more. This provision can only be used where there is an erroneous
preposition of law it cannot be remitted on account of an erroneous conclusion on question of
fact lastly another limit is that the wrong legal preposition must be connected with reason and
decision contain in the award.

Section 16 Sub (3):- An award may be corrected notify under sec 16 or set aside under sec
30. If no objections are filled by either party under these sec or if filled have been disallowed,
the court will pronounce judgment according to the award and a decree will follow However
before law court do this it will have to wait for the period of limitation 130 days for filling
objections unless the parties agree do it sooner. These steps are mandatory otherwise the
award cannot be enforced in court.
All decree are appealable however this section makes a decree passed on the basis of an
award non-appealable unless it is
 In excess of the award.
 Not in accordance with the award.
Section 18:- this section enables the court to pass suitable orders to safeguard the right of the party
in who’s favor the award has been delivered the court has very wide powers to pass any order
considered necessary depending on the steps that the other side in alleged to have taken all
intending to take However, the court must only protect possible right of the party seeking protection
and should not go further to enforce the award as I fit were the decree nor the undue _________on
either side. For example restraining a party form transfer or damaging a property. The following
conditions must be satisfied.

 The award must have been filled in laws

 The court must be satisfied that
(a) The execution of the decree will be defected, delayed or obstructed if no order is passed
or,
(b) Speedy execution of the award is justified by the circumstances and is necessary.

The appellant must make out the prima facie case that there is a reasonable apprehension that
unless the jurisdiction under this sec is exercised there is a real danger that the dependent will put
substantial obstructions in the way of the applicant from getting the full benefits under the award.
Where an order is passes ex-party sun section 2 enables the court tp revise the order if sufficient
cause is shown against it.
 SECTION 20:- WITH INTERVENTION OF COURT

 Following conditions must be satisfied for this sec to apply.

1. The parties must have entered into arbitration agreement.
2. The agreement has been entered into before a suit with respect to its subject matter
is filled in court.
3. That the difference has arisen between the parties to which the agreement applies.
4. The court to which the application has been made has jurisdiction in the matter to
which the agreement applies.

When an agreement of reference to arbitration has been entered into by the parties.

In case where the existence of the arbitration agreement is denied it is for the court to enter
into that question and give a definite finding whether the agreement does not exists.

(Sub Sec4) “Sufficient clause must amount to either the complete abrogation of the
arbitration agreement or perhaps a competent reference already made under the arbitration
clause. This phase should not be confined to fraud, coercion or undue influence. There are
other causes besides these which may be sufficient to entitle a court to refuse to allow the
agreement to be filled. They cover all grounds of justice, equity and good conscience on
which a court thinks an agreement should not be ordered to be filled these words leave a wide
discretion to the court to consider whether an order for filling the agreement should be made
or not. It is not desirable to lie down in general terms what would be sufficient cause and the
court with have to decide this matter of the facts of each case.

Example: non disclosure of relationship of arbitrator with one of the parties, where claims is
time barred a party ______________ a contract on the ground of illegality but was himself
implicated in the legality.

Article 181 of the limitation Act applies to Section 20 therefore such application must be
within 3 years when the right to apply for referring to arbitration arose an order filling or
refusing to file an agreement under the section would be appealable under sec 39 Sub (1) (iv)
 SECTION 21:- PARTY TO A SUIT MAY APPLY FOR REFERENCE

Conditions to be fulfilled:-

 The agreement must be to refer the dispute to arbitration.

 The agreement must clearly set forth what are the matters in dispute between the
parties on which the arbitrators are required to arbitrate
 All the parties interested must agree to submit the difference to arbitration
 The application must be in writing dearly expressing intention to refer arbitration
 The application must be made to the court
 The application must be made before the judgment the judgment is announced
 All condition must be satisfied strictly complied with. If any of these conditions not
followed the reference is void ab-intio and the award will be invalid.

“All the parties to the invested” Ordinarily all the persons who are parties to the suit
should join in an application under section except where the interest of the parties not
joining is separable. Therefore it does not necessary mean all parties to the suit it mean
only parties interested in the specific dispute referred to arbitration and not in the subject
matter of the whole sit where the two are not identical. The award would not be invalid if
some parties have not interest in the suit or only nominally don’t join in the reference. It
should not be limited only to those persons against whom relief is claim. The person
against whom no relief is claimed may be interested in the result of the suit because his
liability to the plaintiff may ultimately arise by reasons of any decision that may be given
in the suit.

It is a question of fact in each particular case whether any particular person is interested in
the specific dispute which is referred to the arbitration or not and that question is too
decided from the whole circumstances and nature of the case.

The court cannot force or coercion the parties to go to arbitration. There must be
voluntary agreement once a matter is referred to arbitration under section the authority of
the court is for the time being suspended and it cannot deal with such matter in the suit.
This authority only revise by an order of the court for the arbitration to superseded under
section 25. Before this the court cannot assume jurisdiction over the matter already
referred to arbitration and cannot pass any order which in any way affects the subject
matter of the suit for example by hearing the merits of the suit or allowing an amendment
of any pleading. During this time the parties hence no right to ask at their own will and
pleasure to supersede the reference and the court has no power to allow withdrawn of the
suit with the permission to file a fresh suit.
 SECTION 30 - GROUND FOR SEEING ASIDE AN AWARD:

Clause (a): It does not necessarily or at all imply anything in the nature of the fraud. It has a
wider significance than personal behavior. Misconduct of an arbitrator may include one or
more of the followings,
1. Neglect of essential duties and responsibilities resulting in substantial miscarriage of
justice.
2. Where the procedure adopted is so irregular as to be opposed to the principal of natural
justice.
3. If there is an indication of gross negligence on the face of it.
4. Bias and partiality, personal interest, personal relationship
5. Mistake as to scope of the authority conferred by the reference to arbitration.
6. Failure to give reasonable opportunity or notice to a party for providing evidence or
proving his case.
7. Proceeding with the hearing without notice to the parties.
8. Refusal to grant adjournment to obtain counsel except where the aim is to delay the
proceeding
9. If there is some mistake of fact provided it is either admitted or atlas clearly beyond
reasonable doubt.
10. If a finding is per-versed or unsupported by the evidence before him.
11. Not deciding the real question in issue.
12. Corruption or bribery.
13. Receiving the fees in advance from one of the parties.
14. Accepting hospitality from one of the parties with the intention of inducing fairness.
15. Unreasonable delay in proceedings.
16. Absence of some arbitrators during inquiry or hearing.
17. Decision based on personal knowledge of arbitrator - an arbitrator cannot import his
personal knowledge into a case or base his decision upon information obtained otherwise
than by the evidence submitted to him by the parties.

The followings are example what are not misconduct;

1. filling the award beyond the time allowed

2. admitting inadmissible evidence ______ the decision is based on it entirely.
Not deciding it in strict accordance with the law.
3. Failure to reduce evidence in writing.
4. Merely committing an error of law.
5. ex-parte hearing where the parties have agreed to do so.
6. Not giving reasons with decision.

Clause (b): First Ground: Sec 19 provides when an arbitrator may be superseding by the
court. One of the ground of suppression there is failure of the arbitrator or umpire to
reconsider and submit the award within the time allowed by the court under Sec 16(3).
However once the time allowed has passed, the specific order of the court to supersede the
arbitration is necessary.
In order to make the award liable to be seaside, the award must have been made after the
order of suppression is made. If the award has been made earlier it cannot be set aside under
this section even if it was not filed before order of suppression as long as it is written and
signed.
An award filed after the issuance of an order of suppression does not become a mere nullity.
If an application is made to seaside the award or if made is refused for reason the award will
become final.
Second Ground: Sec 35 related to effect of legal proceedings in the court on a pending
arbitration where;

1. Legal proceeding upon whole of the subject matter referred and

2. All the parties to the reference are included. Such legal proceedings will
nullify the arbitration proceedings at the expired of the time within which an
application to stay the legal proceeding may be made or on the refusal of such
an application. If an award is made after such arbitration proceedings have
become invalid , is liable to be seaside.

Clause (c) First Ground: “Improperly Procured”;

1. Obtaining an award in ones favour by unfair means or circumstances

2. Suppressing facts which if disclosed would not have lead the other party to
agree to arbitration.
3. Award made by collusion of in consequences of bribe, fraud or dishonesty on
the part of the arbitrator.

Second Ground: “Or is Otherwise Invalid”; This is a very wide phrase and include all
kinds of objections from any cause. it seems alike a catch-all provision e.g; an award which
does not dispose off all matters referred to arbitration are incomplete and consequently
invalid in law hence it may be set aside under this provision or may be remitted under section
16.
Where an award has been set aside the court has no power to look at the award at all or even
to treat it as if it were the report of a commissioner.
An application for setting aside an award must be made within 30 days of the services of the
notice of filling of award. An appeal against court order is possible under sec 39(2).
 SECTION 31- JURISDICTION:

Subsection (1): If reference has been made in a suit or if an agreement has been filed in court
under section 20, the award will be filed in the same court which made the reference. In
arbitration without the intervention of the court, an award can be filed in any court having
jurisdiction the matter to which the reference relates.
The term court has been defined in section 2 as a civil court having jurisdiction to
decide their question forming the sub matter of reference if the same had been subject matter
of the suit.
Court having jurisdiction does not mean that the court must have jurisdiction over
whole of the subject matter to which the reference relates and the question should be decided
in accordance with the provisions of CPC

Subsection (2 & 3): This provision states that the question regarding the validity, effect or
existence of an award shall be decided by the court in which the award has been filed and
such court alone. If the award has not been filed the question may be raised in any court in
which the award might have been filed. No other court will have jurisdiction to adjudicate on
such matters. These words are comprehensive enough to include every question which may
have any bearing upon the award.

Subsection (4): Generally section 31 provides that all matters relating to a single reference
shall be before the same court and where there is a choice of forum this subsection provides
that it shall be determined by the first application made to a court in relation to a reference.
After this, that court alone will have and all subsequent application will be filed in that court.
It is possible for two different courts to both have jurisdiction over a matter. Where
simultaneous proceedings are started in different courts by different parties in different dates
the court in which the application has been moved earlier will be entitled to precede the case.
 SECTION 32 - BAR TO SUITS CONTESTING ARBITRATION AGREEMENT:

The intention here is to consolidate the law relating to arbitration and to prevent parties to an
arbitration from raising question relating to the arbitration agreement in any manner other
than provided by this act.
One of the main object was to provide that claims to seaside the arbitration award or
challenge arbitration agreement should be made by application to court and decided on
affidavits and other evidence and not by means of suit.
So a suit where any question may be raised with regards to the existence and validity
of an award is expressly barred by this section. The only remedy for a party to challenge an
arbitration agreement or award would be by way of an application under section 33.
The words “on any ground” are important and wide enough to cover any possible case
effecting the award or arbitration agreement including an injunction restraining arbitration
proceeding on the ground of fraud, other than the ways provided in section 33.
There is no bar to file a suit on the original cause of action where the arbitration proceedings
are abortive or incomplete.
Similarly section 32 cannot bar a suit by a person who is not a party to the arbitration
agreement nor is section 32 a bar to a suit for redemption against the person not a party to the
arbitration agreement.
 SECTION 33: ARBITRATION AGREEMENT OR AWARD

TO BE CONTESTED BY APPLICATION.

Section 32 bars a suit on any ground whatsoever for a decision upon the existence, effect or
validity of an arbitration agreement or award. It further provides that no arbitration agreement
or award shall be set aside, modified, amended or in any way effected otherwise then as
provided in this act.

Section 33 provides a procedure for a person who feels aggrieved by any arbitration
agreement or award. The remedy is by way of an application which may be made by party to
an arbitration agreement or any person claiming through him. The application has to be made
to a Court who will dispose-off the application on affidavits. This means that there will be no
evidence and the decision will be made simply on the documents provided such as in a
typical application for an interim injunction. However the Court is empowered to require the
parties to produce other oral or documentary evidence to pass order for discovery and
particulars as if the proceedings were in a suit. (Usually in complicated and contested
question of law and fact).

This section provides a speedy remedy to a party objecting to a reference or award instead of
filling a separate suit for this purpose. He can now merely file an application, hence saving
expense and time.

This Section can only be used by a party who wants to obtain the Court’s declaration of the
non-existence of an agreement for his own use. A person who affirms the existence of an
arbitration agreement cannot apply to the Court under any section including this for
adjudicating by the Court that such an agreement exists and is binding on the parties.

The facts that a party denies to have signed the contract (arbitration agreement) will not
disentitled him to challenge it under section 33 as the words “any party to an arbitration
agreement” include a party who is alleged to be a party to an agreement but who challenges
the existence thereof.

Limitation is 30 days from the service of the notice of the filling of the award.

Decision under section 33 is open to revision under Section 115 C.P.C.

SECTION 34 - POWER TO STAY LEGAL PROCEEDINGS WHERE THERE IS AN
ARBITRATION AGREEMENT:

The following conditions must be complied with to enable a party to obtain a stay;

1. There must be an arbitration agreement in existence.

2. The legal proceeding must have been started after the agreement referred to
arbitration.
3. Legal proceeding must have been started by the party to the agreement or any person
claiming under him against any other party to the agreement or any person claiming
under him.
4. The legal proceedings must be with respect to the matter agreed to be referred to the
arbitration.
5. The application for stay must have been filed before the filling of written statement or
taking any other step in the legal proceedings which might show a willingness to
continue with the suit - it is a very strict requirement.
6. The party asking for stay must be ready and willing to do all the things necessary to
proper conduct of arbitration.
7. The court must be satisfied that there is no other significant reason why the matter
should not be referred to arbitration in accordance with the agreement.
8. The plaintiff will file a suit against the defendant(s) and the defendants(s) will then
apply to the court under section 34 to stay the suit so as to enable the parties to obtain
a reference to arbitration.
9. An application under this section is in the nature of a summary procedure and does
not normally include any lengthy inquiry and investigation involving evidence. The
court will take into account the allegations in the plaint, the application for stay and its
reply, the documents filed by the parties and any affidavits that may have been filed
by the parties in support of their respective claims.
10. The function of the court is very limited and the only point which the court has to
consider is other the claims brought in the suit comes within the submission to
arbitration. Once the spite is found to be within the scope of arbitration agreement it is
not the part of the jurisdiction of the court to enter into the merits of the dispute.
Hence the court must not decide or express any opinion on the merits of the claim
made in the plaint.
11. this section applies only in case where the court itself has the jurisdiction to decide the
matter but allows it to go on to arbitration on account of arbitration agreement and in
view of other circumstances of the case.
12. where agreement of reference of the disputes to arbitration has become impossible to
be performed stay under section 34 must be refused and the court must hear the matter
e.g. where arbitration agreement provides for a specific arbitrator and no one else but
him and that arbitrator died then in such situations court must hear the matter, unless
the parties create a new arbitration agreement.
13. the court will not affect an arbitration agreement where it has been waived, in one of
the following manner
a. express agreement to do so
b. express refusal to exercise it
c. failure to neglect or arbitrate
d. participating without objection in the trial of same matter
e. omitting to demand arbitration within reasonable time.
If the defence in agreement, that the agreement was not enter into the matter
exclusively fixed before the court on the material and not before it and to arbitration when an
application under section 34 is made. This includes an allegation by a party that assigned the
parent/main contact in ignorance of the arbitration clause.
 Section 38:
This section comes into play where there is dispute with respect to the dispute payment of
fee.
If there is a written agreement between parties and arbitrators about the pay of fee the
parties must pay the fees so agreed upon and this section will provide no relief to the
parties even if the fees agreed upon is excessive. Where however there is no such
agreement and the parties feels that the fees demanded is excessive and unjustified, he
may file an application under sub section 1. In its inquiry the court will have regard to the
time and labor involved as well as any special and technical knowledge brought to be
used in the matter.
Though the court has power to reduce the fee and remuneration if found excessive or
unreasonable it has no power to reduce or disallow the amount of charge and expenses
under this section.
Alternately the award will provide for the cost of the arbitration and by whom it is to be
paid but if the awards silent on this point or the provision contained is not sufficient the
court may pass such orders about it as it thinks fit.

Section 39:
Sub section 1:

(i) This is superseding arbitration section 19-the phrase superseding an arbitration is

not included as an order refusing to supersede arbitration and therefore such an
order is not appealable all orders of suppression will be appealable irrespective of
the grounds upon which they are based.
(ii) Section 39(1)(2) on an award stated on special order 13(a)
(iii) Modify or correcting an award (section 15) when an order has been made
modifying an award the validity of the whole award cannot be called in question
in appeal preferred against the order but the appeal is allowed against the order
only in so far as it modify the award. Therefore the appeal must be limited the
modification and correction only and no other ground can be urged in the appeal.
(iv) Filling or refusing to file an arbitration agreement (section20)
(v) Staying or refusing to stay legal proceedings where there is an arbitration
agreement (section 34)
(vi) Setting aside or refusing to set aside an award (section 30)

Sub section 2:

Of all the orders that may be passed by the court under provisions of this act, only those
orders which are covered by clause (i) and (vi) as mentioned above of subsection 1 will
be appealable and even in these cases no second appeal will lie from an order passed on
appeal.
Explanation: suppose you are in front of Senior Civil Judge and you want to appeal
against this order will be appeal to the District Judge after this you do not have a second
appeal to the high court however you may go directly to Supreme Court. Similarly, you
may start from high court and may want to appeal an order, you appeal to the Double
 Bench of the High Court. After this there is no second appeal however you may again go
directly to the Supreme Court as mentioned above.

Section 41:

Subsection (a): The provisions of the CPC are applicable to all proceedings before the court
under the provisions of this act, provided such provisions of CPC are not inconsistent with
the provision of arbitration act.

Subsection (b): The court is given the powers relating to the matters mentioned in PARAS 1-
5 of the second Schedule of Arbitration Act. The court is to exercise such power with respect
to these matters subject to two limitations.

(i) They are to be exercised to the same extended as the cast does for the purpose of
and in relation to any other proceeding before it;
(ii) The exercise of these powers shall not prejudice any powers which may be vested
in an arbitrator or empire.

SECTION 43 - POWER OF THE COURT TO

ISSUE PROCESSES FOR APPEARANCE BEFORE ARBITRATOR:

1. The court shall issue the same processes to the parties and the witnesses who’s the
arbitrator or umpire desires to examine, as the court may issue in suits tried before it.
2. Persons failing to attend in accordance with such process or making any other default
or refusing to give their evidence or guilty of contempt to the arbitrator or umpire
during the investigation of reference, shall be subject to the like disadvantages,
penalties and punishments by order of the court on the representation of the arbitrators
or umpire as they would incur for like offences in suits tried before the court.
3. In this section the expression “process” includes summons and commission for the
examination of witnesses and to produce documents.
Sub Section (1) empowers the court to issue summons to the parties or witnesses whenever
the arbitrator desires to examine them. It appears therefore that the motion for the issue of the
summons will have to be made by the arbitrator or umpire. The parties will make a prayer for
the same before the arbitrator or the umpire and the arbitrator or umpire if he desires to
examine them will ask the court for issuance of summon.

The court will issues processes against the parties and witness only as the arbitrator or
umpires Seders. They may desire to examine a witness whether or not he is named as a party
to process issue against him. However the parties may raise e objection to this under sec 30.
The same will apply where the arbitrator or umpire considers the evidence of a witness
named by the parties to be unnecessary or immaterial or refuses to be summoned. If the
evidence is material after filing objection under sec 30 by parties then court will not be able
to issues process.
 SECTION 44 - POWER OF HIGH COURT TO MAKE RULES:

The High Court may make rules consistent with this act as to

a. filling the award and proceedings consequent thereon or incidental thereto

b. the filing and hearing of special cases and all proceedings consequent thereon and
incidental thereto
c. the staying of any suit or proceeding in contravention of an arbitration agreement
d. the forms to be used for the purpose of this act
e. all proceedings in court under this act

This is for those situations where there is no express provision in the act to cover a particular
class of cases so that the high court may frame rules is that they must be made in accordance
with the provisions of the act otherwise they would be inappropriate.

SECTION 45 - GOVERNMENT TO BE BOUND:

This section will be bold on the government. This section confirms the civil liability of the
government to be bound by an arbitration agreement and an award to the same extent as an
ordinary individual.

SECTION 46 - APPLICATION OF ACT TO STATUTORY ARBITRATIONS:

The provisions of this Act, except sub-section (1) of section 6 and section 7, 12, 2[,36] and
37, shall apply to every arbitration under any other enactment for the time being in force, as if
the arbitration were pursuant to an arbitration agreement and as if that other enactment were
an arbitration agreement, except in so far as this Act is inconsistent with that other enactment
or with any rules made there under.
Arbitration may be of two types:

a. voluntary - that is under an arbitration agreement b/w parties or

b. Statutory - that where there is no agreement or contract b/w parties but they have to
make reference under the provision of some act.

This section is provided for the statutory type of arbitration. In all such cases the enactment
under the provisions of which the reference is made will be deemed to be the arbitration
agreement and the arbitration proceedings will be conducted as in the case of any other
arbitration agreement.
 SECTION 47 - ACT TO APPLY TO ALL ARBITRATIONS:

Subject to the provisions of section 46, and save in so far as is otherwise provided by any law
for the time being in force, the provisions of this Act shall apply to all arbitrations and to all
proceedings there under:
Provided that an arbitration award otherwise obtained may with the consent of all the
parties interested be taken into consideration as a compromise or adjustment of a suit by any
Court before which the suit is pending.

SECTION 48 - SAVING FOR PENDING REFERENCE:

This section will not apply to any reference pending at the commencement of this act, to
which the law in force immediately before the commencement of this act shall not
withstanding any repeal effected by this act continue to apply.