25 January, 2016
The Arbitration and Conciliation (Amendment) Act, 2015
The GoI had issued the the Arbitration and Conciliation (Amendment) Ordinance, 2015 (‘Ordinance’), effective from October 23, 2015. The Parliament has recently passed, and the President of India has given his assent to the Arbitration and Conciliation (Amendment) Act, 2015 (‘Amending Act’).
The Amending Act was notified on January 1, 2016, but is deemed to have come into force from October 23, 2015 and has repealed the Ordinance. The Amending Act is identical to the Ordinance in all respects, barring the exceptions listed below:
- A new Section 26 has been introduced in the Amending Act, which inter alia pro- vides that the provisions of the Amending Act will not apply to arbitral proceed- ings commenced prior to the Amending Act having come into force, unless other- wise agreed between parties.
- The Sixth Schedule of the Ordinance, read with the new Section 12(1)(b) of the Arbitration & Conciliation Act, 1996 (‘Principal Act’), required a proposed arbi- trator to inter alia disclose circumstances which are likely to affect his/her ability to complete the entire arbitration within a period of 24 months, and pass an award within three months of concluding the arbitration. The Amending Act has revised the period of 24 months and the additional three months, to a total period of 12 months.
- The second proviso to Section 12(5) of the Principal Act, as amended by the Ordi- nance, provided that a proposed arbitrator will be ineligible to be appointed if his relationship with either the parties or counsel or subject matter of the dispute falls in the categories listed in the Seventh Schedule of the Ordinance. This proviso has not been included in the Amending Act, presumably in light of the new Section 26 having been introduced.
The Amending Act has now deleted the explanation clauses to Sections 47 and 56 of the Principal Act8 as set out in the Principal Act, and has substituted it with the new explanation clause, as introduced by the Ordinance stating that the ‘Court’ will mean High Court in all matters where it exercises ordinary original jurisdiction and in other matters it will also mean to be a High Court exercising appellate jurisdiction.
The Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015
GOI had issued the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Ordinance, 2015 (‘Commercial Courts Ordinance’), effective as of October 23, 2015. Consequently, The Commercial Courts, Commercial Division and Commercial Ap- pellate Division of High Courts Act, 2015 (‘Commercial Courts Act’) has received the assent of the President of India on December 31, 2015 and is deemed to have come into effect on and from October 23, 2015, i.e. the date of the Commercial Courts Ordinance.
The Commercial Courts Act repeals the Commercial Courts Ordinance while clarifying that anything done pursuant to the provisions of the Commercial Courts Ordinance, will be deemed to be done under the Commercial Courts Act. The Commercial Courts Act is identical to the Ordinance, barring a few exceptions listed below:
- The first proviso of Section 7 of the Commercial Courts Ordinance provided that all the suits and applications relating to commercial disputes of a specified value, i.e. where the value of the subject matter is not less than ¤10 million (approxi- mately US$ 1,51,500), stipulated by a relevant act to lie in a District Court or above and filed on the original side of the High Court, will be heard and disposed off by the Commercial Division of the High Court. In the Commercial Courts Act, it has been clarified that the first proviso extends to even those cases that are currently pending on the original side of the High Court.
- Section 10 of the Commercial Courts Ordinance provided that all applications and appeals in arbitration matters (domestic and international), involving a commer- cial dispute which are filed in a High Court will be heard by the Commercial Ap- pellate Division. The Commercial Courts Act on the other hand specifies that such cases are to be heard by the Commercial Division of the High Court, and not the Commercial Appellate Division.
8 Section 47 and 56 of the Principal Act pertain to the documents/evidence to be produced before a relevant court at the time of application for the enforcement of a foreign award.
For further information, please contact:
Zia Mody, Partner, AZB & Partners
zia.mody@azbpartners.com
