Courts Strictly Following Principles Of Non-Interference To Arbitral Awards; Parties To Arbitration Must Accept Awards: Justice SK Kaul

Speaking at the concluding session of Delhi Arbitration Weekend (DAW), the Supreme Court Judge, Justice Sanjay Kishan Kaul said that Indian Courts are strictly adhering to the principles of non-interference with the arbitral awards. He also added that parties to the arbitration must learn to accept the awards and avoid multi-tiered litigation just to complete the formality. “I often say that the parties must learn to accept the awards. Unfortunately, the public sectors more so require this. There is no point in carrying a battle through a two or three-tier scrutiny just to complete a formality. I think that is something I am sure the Law Minister will look into,” he said. He added that the Supreme Court has upheld the principle of autonomy of parties to the arbitration. He also said that the Supreme Court should entertain an appeal only with a view to settling the law if some unique point is raised before it, a point, which has not been answered by the Supreme Court earlier. In this regard, he referred to several landmark rulings of the Supreme Court. In his address, he also said that today, the parties have a wide range of disputes, and resolution is the most opted way out, the reason being that parties' autonomy is present there. Regarding the law which governs the field of arbitration in India, Justice Kaul noted as to how The Arbitration and Conciliation Act, of 1996 is an evolving legislation, which was amended in 2015, 2019, and 2021. He added that the amendments in the Act showcase the vibrancy of the arbitration ecosystem across the Country. A large part of his address focused on the issue of using technology, especially virtual hearings, in arbitration proceedings. Justice Kaul stressed as to how the virtual hearing in the Courts have increased efficiency and as to how it is necessary to utilise this system for which a vast infrastructure has been created “Virtual hearings have done away with the need of unnecessary spending of money of time to travel to various parts of the world. It has also made it easier for the arbitrators and practitioners to find a suitable date for the arbitration hearing. Some arbitration institutions have explicitly come out with virtual hearing rules.” However, he did add that the VC hearing is not a foolproof system as it has its own set of problems. “One such problem is due process risk such as holding a virtual hearing with objections from one party concerned about inadequate access of technology…the risk the witnesses during oral testimony leading to affecting the arbitral award.” Regarding the use of Artificial intelligence, he said that with the arrival of ChatGPT, people can get answers to their queries and even the Supreme Court has instituted an AI committee. However, he added that when it comes to arbitration, though AI can be used by suitably trained arbitrators, it must be used carefully as it comes with risks of due process rights and public policy violations. Significantly, in his address, Justice Kaul expressed a view that institutionalizing the arbitration system would give a boost to the arbitration landscape, examples being Indian Council for Arbitration, DIAC. He said that the establishment of international institutions such as the International Chamber of Commerce (ICC) and the London Centre for International Arbitration (LCIA) prompted the establishment of various homegrown international arbitration institutions. In this regard, he added that the Mediation Bill, which will probably see the light of day this year is also geared towards institutionalizing this system.

Courts Strictly Following Principles Of Non-Interference To Arbitral Awards; Parties To Arbitration Must Accept Awards: Justice SK Kaul

Sparsh Upadhyay

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