TABLE OF CONTENTS

LIST OF ABBREVIATIONS...................................................................................................................5
LIST OF CASES.......................................................................................................................................5
ABSTRACT...............................................................................................................................................7
INTRODUCTION.....................................................................................................................................8
PROBLEMS OF FORMAL LEGAL SYSTEM......................................................................................8
THE ALTERNATIVE DISPUTE RESLUTION MECHANISM..........................................................9
FUNCTIONS OF ADR...........................................................................................................................9
MECHANISMS OF ADR ....................................................................................................................10
ARBITRATION IN INDIA....................................................................................................................11
TYPES OF ARBITRATION IN INDIA................................................................................................12
ADVATAGES OF ARBITRATION.....................................................................................................12
NEED FOR ARBITRATION IN INDIA...............................................................................................13
ARBITRATION IN GOVERNMENT CONTRACTS.........................................................................14
BACKGROUND...................................................................................................................................14
CHALLENGES THAT MAY ARISE...................................................................................................14
NEED FOR ARBITRATION CLAUSE IN GOVERNMENT CONTRACTS......................................14
TENDERS CONTAINING ARBITRATION CLAUSES.....................................................................15
ENFORCEABILITY OF ARBITRATION IN GOVERNMENT CONTRACTS..............................15
PROCESS OF ARBITRATION.............................................................................................................16
AD HOC v. INSTITUTIONAL ARBITRATION- WHICH TO PREFER.........................................16
AD HOC APPOINTMENTS- REAL LIKELIHOOD OF BIAS...........................................................16
INSTITUTIONAL ARBITRATION- EFFECTIVENESS....................................................................17
RECOMMENDATIONS TO IMPROVE EFFECTIVENESS OF ARBITRATION IN
GOVERNMENT CONTRACTS............................................................................................................18
ARBITRATION AND CONCILIATION (AMENDMENT) BILL, 2018.............................................18
CONCLUSION........................................................................................................................................20
BIBLIOGRAPHY....................................................................................................................................20
ANNEXURE............................................................................................................................................22
SNIPPETS OF INTERVIEW WITH THE JUDICIAL MEMBER OF C.G. ARBITRATION
TRIBUNAL..............................................................................................................................................22
 LIST OF ABBREVIATIONS
S.no. Abbreviations Full form
1. Art Article
2. ADR Alternative Dispute Resolution
3. NITI National Institute for Transforming India
4. UNCITRAL United Nations Commission on International
Trade Law
5. IP Intellectual Property
6. SC Supreme Court
7. SCC Supreme Court Cases
8. AIR All India Report

LIST OF CASES

 BSNL v. Telephone Cables Ltd., (2010) 5 SCC 213.

 Bharat Aluminium Co vs Kaiser Aluminium Technical, CIVIL APPEAL NO.7019

OF 2005.
 Booz-Allen & Hamilton Inc vs SBI Home Finance Ltd. & Ors, (2011) 5 SCC 532.
C
 Comed Chemicals Ltd. v. C.N. Ramchand, 2008 (13) SCALE 17.
D
 Denel Proprietary Ltd. v. Bharat Electronics Ltd. and anr.,(2010) 6 SCC 394
F
 Fair Air Enfineers (P) Ltd. v. N. K. Modi, (1996) 6 SCC 385.
 Fertilizer Corpn of India v. Domestic Engg Installation, AIR 1970 All 31.
G
 Guru Nanak Foundation v. Rattan Singh and Sons, (1981) 4 SCC 634.
I
 International Airports Authority of India v. K.D. Bali & Anr; (1988) 2 SCC 360.
M
  M/S. Afcons Infra. Ltd. & Anr vs M/S Cherian Varkey Constn and ors., CIVIL
APPEAL NO.6000 OF 2010.
 Minal Pipe Mfg Co. v. Haryana State, AIR 1992 P&H 244.
S
 State of Orissa v. Bhagyadhar Dash, (2011) 7 SCC 406.
T
 Trustees of the Port of Madras v. Engg Construction Corp Ltd., (1955) 5 SCC 531.
U

 Union of India v. M/s Singh Builders Syndicate, (2009) 4 SCC 523.

 Union of India v. M.P. Gupta, (2004) 10 SCC 504; also Ace Pipeline Contractors v.
Bharat Petroleum, (2007) 5 SCC 304.
 ABSTRACT

Peace is the sine qua non of a civilized society and one of the most important factors that
ensures maintenance of peace is the faith of people in the justice delivery system. This faith
mainly relies on the factors like efficiency of the system, the cost of justice, the time for
achievement of justice, etc. These factors may easily be adhered to with ADR system as it
reduces the time taken, cost, etc. Further, the government contracts form the basis of the
development of our society. However, they suffer from some major conflicts which need to be
solved through arbitration for efficiency.

In the above backdrop this paper would deal with the concept and effectiveness of arbitration,
more specifically in government Contracts in Indian regime. It does so by providing a brief
explanation of the concept of arbitration and then defining it in Indian sense. Further it tracks
the record of its effectiveness based on the report of NITI Aayog. It then goes on to deal with
arbitration in government contracts and its importance while providing information about the
best arbitration procedure for disputes arising out of such contracts. It then goes on to conclude
by recommending measures for effective arbitration in cases involving the government as a
party. Further in the annexure, it provides a brief account of an interview of Judicial Member of
C.G. Arbitration Tribunal by the author.

Keywords: arbitration, ad hoc arbitration, institutional arbitration, government contracts,

tenders.
 INTRODUCTION

“Discourage litigation. Persuade your neighbours to compromise wherever you

can. Point out to them how the nominal winner is often a looser – in fee, expenses
and waste of time.”1

Dispensation of justice is at the root of any civilized society. This aspiration of achievement of
justice is reflected in the Preamble of the India Constitution itself in the phrase “justice- social,
economic and political”. The administration of justice while includes protection of the innocent,
condemnation of the guilty and satisfactory relief, it has been interpreted to include speedy trial
under Art 21.

It has been widely accepted that the adversarial system is not efficient in achieving the
aforementioned requirements of satisfactory and speedy relief; the reasons being huge pendency
of cases, lack of manpower, costs, and many other unaccounted reasons.

PROBLEMS OF FORMAL LEGAL SYSTEM

 Delays: The greatest problem faced by the justice dispensation system is the delay in
disposal of cases. The average time for disposal of both civil and criminal cases may
extend to a number of years negating the idea of fair justice. In 2015, it was observed that
the backlog of cases in the Apex Court was nearly 59,272.2 ADR may be used as a
weapon to evade this challenge.
 Costs: The aforementioned delay in adjudication of cases adds to the costs that are
normally needed to be borne by the litigants. This makes the unavailability of effective
mechanism for recovery eve more problematic.
 Awareness and accesibility: Another fact that adds to the disadvantage of the legal
system is the awareness regarding rights and liabilities among the people and also
accessibility of courts.

1
Abraham Lincoln
2
Sinha S.B., ADR AND ACCESS OF JUSTICE: ISSUES AND PERSPECTIVE, Available at:
http://www.nja.nic.in/Concluded_Programmes/2016-17/P-1002%20TOC.pdf, [Accessed on 4 October, 2019].
This is where ADR comes into picture.

THE ALTERNATIVE DISPUTE RESLUTION MECHANISM

Although ADR is considered a developing area, India is not a stranger to parties settling their
disputes among themselves or with the help of a third party. In Ancient India, Parishads, Srenis,
etc. helped peacefully resolve disputes.3

The foremost object of ADR mechanism is to do away with the high expenses, undue delays and
most importantly achievement of the noble ideology of access to justice for all. It has been held
to be an attempt at providing for an alternate effective mechanism to substitute the traditional
dispute resolving methods.4 ADR can be defined as a technique of reaching an amicable solution
with the help of a neutral third party, in a manner agreed upon by the parties. So, ADR may be
said to aim at providing justice which not only resolves dispute bur which also helps in
harmonizing the relations among the parties.5

FUNCTIONS OF ADR

The function of ADR may be briefly enumerated as under:-

 To reach an amicable and neutral solution acceptable to all the parties involved.
 Providing easy “access to justice”
 To provide a better and long lasting solution.
 It is a compromise between the parties, signifying that none looses or wins the
proceedings.

3
Ibid.
4
Guru Nanak Foundation v. Rattan Singh and Sons, (1981) 4 SCC 634.
5
Trustees of the Port of Madras v. Engg Construction Corp Ltd., (1955) 5 SCC 531.
MECHANISMS OF ADR
The present paper deals with the concept and effectiveness of arbitration, more specifically in
government Contracts in Indian regime. It does so by providing a brief explanation of the
concept of arbitration and then defining it in Indian sense. Further it tracks the record of its
effectiveness based on the report of NITI Aayog. It then goes on to deal with arbitration in
government contracts and its importance while providing information about the best arbitration
procedure for disputes arising out of such contracts. It then goes on to conclude by
recommending measures for effective arbitration in cases involving the government as a party.
Further in the annexure, it provides a brief account of an interview of Judicial Member of C.G.
Arbitration Tribunal by the author.

ARBITRATION IN INDIA

Due to huge pendency of cases in the Indian Courts, a pressing need was felt to provide for
alternative dispute resolution mechanisms. The first enactment in India to provide for arbitration
was the Arbitration and Conciliation Act, 1940, with other complementing Acts like
Arbitration (Protocol and Convention) Act, 1937 and the Foreign Awards Act, 1961. However,
these laws were found to be ineffective and hence the Arbitration & Conciliation Act, 1996
(“Act”) was enacted based on the 1985 UNCITRAL Model Law on International Commercial
Arbitration and the UNCITRAL Arbitration Rules, 1976.6

As provided earlier, arbitration is a process in which an arbitrator appointed by the parties or the
court adjudicates the dispute and passes an order by application of the Arbitration and
Conciliation Act, 1996.7 The Act deals comprehensively with both domestic and international
arbitration.

SUBJECT MATTER OF ARBITRATION

6
Kachwaha S., ARBITRATION IN INDIA: AN OVERVIEW, Available at: https://ipba.org/media/fck/files/Arbitration
%20in%20India.pdf, [Accessed on 5 October, 2019]
7
M/S. Afcons Infra. Ltd. & Anr vs M/S Cherian Varkey Constn and ors., CIVIL APPEAL NO.6000 OF 2010.
Any commercial dispute may be subjected to arbitration including tortuous matters provided that
they relate to contract between the parties. However, certain matters relating to public policy like
matrimonial matters, criminal proceedings, insolvency matters, IP matters, anti- trust matters,
consumer matters, etc. cannot be subjected to arbitration.8 Further matters of employment also,
cannot be subjected to arbitration as they involve master servant relationship, exception being
company disputes as the relationship in these cases is not of master-servant.9

TYPES OF ARBITRATION IN INDIA

ADVATAGES OF ARBITRATION

 Cost effective: It is an established fact that arbitration has been developed as a mode of
dispute resolution to minimize the time taken for reaching an amicable solution. This in

8
Booz-Allen & Hamilton Inc vs SBI Home Finance Ltd. & Ors, (2011) 5 SCC 532.
9
Comed Chemicals Ltd. v. C.N. Ramchand, 2008 (13) SCALE 17.
 turn leads to lower costs as the costs attached to the prolonged process of adjudication are
done away with.
 Informal proceedings: The proceedings under arbitration are much less formal than
those conducted in the courts. They are not governed by the CPC but by such rules as
may be agreed upon by the parties. The parties may even choose a convenient setting for
proceedings rather than a courtroom. Hence, the parties are more comfortable and eased
out during conduction of the proceedings.
 Privacy ensured: Arbitration is conducted by a neutral private person or body of people
agreed upon by the parties. They are held in private and the parties may further agree to
keep the final resolution confidential.
 Control: The parties have a greater degree of autonomy and control over the proceedings
as the rules, place, arbitrator, etc. are chosen by the parties. Such is not the case with
court proceedings, where the judge knows little to nothing about the subject- matter and
may not have expertise in a particular matter. While in arbitration, the parties may choose
such an arbitrator who has expertise of the said area.

This makes it clear that when it comes to commercial disputes it is advantageous to opt for
arbitration rather than go through the tedious process of court proceedings.

NEED FOR ARBITRATION IN INDIA

The dispute resolution process has huge impact of the interest of international companies in
investing in India. This is indicated by the World Bank in ranking India 131st out of 189
countries on the ease of following rules by the private companies.10

It has also been pointed out by the Supreme Court in Bharat Aluminium Co vs Kaiser
Aluminium Technical Co. Ltd.11 that India should move towards a system of less intervention
by the courts and making dispute resolution system more approachable system where pendency
may be reduced. Since, pendency had increased due to intervention; companies are becoming

10
Debroy B. and Jain S., STRENGTHENING ARBITRATION AND ITS ENFORCEMENT IN INDIA- RESOLVE IN
INDIA, Available at: https://niti.gov.in/writereaddata/files/document_publication/Arbitration.pdf, [Accessed on 5
October, 2019].
11
Bharat Aluminium Co vs Kaiser Aluminium Technical, CIVIL APPEAL NO.7019 OF 2005.
less interested in investing which can be handled only by preferring arbitration over judicial
proceedings.

ARBITRATION IN GOVERNMENT CONTRACTS

BACKGROUND

The key focuses and areas of work of the government include infrastructure development,
maintenance, education, taxation, healthcare and administration. These require plenty of work to
be done on a regular or on and off basis which is generally allotted through contracts of
significant value and time. These are generally executed by inviting bids and accepting the
highest bids.

CHALLENGES THAT MAY ARISE

The major challenges that may arise in case of government contract include:-

 Biddings based on estimations: The tenders are generally entered into based on
approximate costs due to non- accounting of environmental and various other factors
may lead to dispute in subsequent stages.
 Delay in payments: Whenever the issue of payment by government departments is in
question, there is high probability of delay in such payments. Generally, penal provisions
are incorporated in the contracts, however there are very few instances where these are
adhered to, leading to another ground of dispute.
 Standardized documents: The non- adaptability to each individual situation is very
common when it comes to government contracts. Since a standardized contract is used
for all the contracts by a department, it leads to unnecessary chaos and confusion and
hence dispute.
NEED FOR ARBITRATION CLAUSE IN GOVERNMENT CONTRACTS

As of 31st March 2013, it was observed that 135 cases were pending before the arbitral tribunal
amounting to Rs. 9000 Crores just relating to NHAI, further 79 cases amounting to Rs. 2000
Crores were pending before various courts.12

Similarly there are many cases relating to various other departments like PWD, Railway,
Military Engineering Services, State Government Departments, etc. pending before various
courts relating to various matters including release of due payment, completion of projects, etc.
This leads to a huge amount being held up in the court proceedings only and further slowing
down the projects. Hence it is necessary to incorporate an effective and apt arbitration clause in
the government contracts.

TENDERS CONTAINING ARBITRATION CLAUSES

The acceptace of a tender which consists of an arbitration clause is sufficient to bind both the
parties to arbitration.13 If an authorized functionary of the government accepts such a contract, it
would be considered a compliance of the requirement of Art. 299 of the Indian Constitution and
would bind the Government by arbitration clause.14

ENFORCEABILITY OF ARBITRATION IN GOVERNMENT CONTRACTS

 Fair Air Engineers (P) Ltd. v. N. K. Modi 15: A proposal was made in a form of
quotation for installation of centrally air-conditioning plant. Counter proposal were made
by the second party, and finally an agreement was reached. The agreement contained an
arbitration clause. It was held that the parties became found by the said clause.
 State of Orissa v. Bhagyadhar Dash16: A government contract contained a clause
making the decision of the Superintending Engineer final in case of rates of non- tenderd

12
Supra note 10.
13
Fertilizer Corpn of India v. Domestic Engg Installation, AIR 1970 All 31.
14
Minal Pipe Mfg Co. v. Haryana State, AIR 1992 P&H 244.
15
Fair Air Enfineers (P) Ltd. v. N. K. Modi, (1996) 6 SCC 385.
16
State of Orissa v. Bhagyadhar Dash, (2011) 7 SCC 406.
 work. It was held that since there was no specific clause or agreement as to arbitration,
the reference to arbitration would be improper.
 BSNL v. Telephone Cables Ltd.17: The agreement contained arbitration clause making
arbitration applicable only if purchase order was made. It was held that in he absence of
such an order arbitration would not be applicable. However, it would be applicable once
such an order is made.

PROCESS OF ARBITRATION

The process of reference to arbitration tribunal in case of a government contract may be

explained using the following flow chart:-

The arbitrators are the masters of their own proceedings, only subjected to the parties agreement.
Their powers include “the power to determine the admissibility, relevance, materiality and
weight of any evidence”18 The only guiding force for them is to treat both the parties equally and
give them both full opportunity to present their case.

17
BSNL v. Telephone Cables Ltd., (2010) 5 SCC 213.
18
International Airports Authority of India v. K.D. Bali & Anr; (1988) 2 SCC 360.
 AD HOC v. INSTITUTIONAL ARBITRATION- WHICH TO PREFER

AD HOC APPOINTMENTS- REAL LIKELIHOOD OF BIAS

Impartiality of the arbitrator is the most essential ingredient of an arbitration proceeding.

However, if an ad hoc arbitration tribunal is constituted with an arbitrator appointed by the
Government department, there is a high chance of bias. But in pre 2010 era the court in various
cases including Union of India v. M.P. Gupta19 the Apex Court had taken he stance that in
contracts with Government company/ statutory body, the practice of appointment of an employee
of the corporation as an arbitrator would not ipso facto raise the assumption of bias.

The Supreme Court deviated from this view in the case of Denel Proprietary Ltd. v. Bharat
Electronics Ltd. and anr.20, where it held that a Managing Director of one of the parties cannot
be appointed as arbitrator as he cannot act freely and without bias, even if that implies deviating
from the terms of arbitration agreement.

Further, taking a note of the aspect that when a Government contract is made with arbitration
clause with an employee as an arbitrator, the SC in Union of India v. M/s Singh Builders
Syndicate21 advised that the Government come up with such mechanism so as to phase out the
appointment of employees as arbitrators.

INSTITUTIONAL ARBITRATION- EFFECTIVENESS

 Permanency: Institutional arbitration has the advantage of permanency. This further

provides an advantage as to continuity and hence expertise in conduction of arbitration.
 Authenticity: Further the institutional arbitration has the advantage of authenticity as
these are statutory institutions having a fixed set of rule to govern their proceedings.

19
Union of India v. M.P. Gupta, (2004) 10 SCC 504; also Ace Pipeline Contractors v. Bharat Petroleum,
(2007) 5 SCC 304.
20
Denel Proprietary Ltd. v. Bharat Electronics Ltd. and anr.,(2010) 6 SCC 394
21
Union of India v. M/s Singh Builders Syndicate, (2009) 4 SCC 523.
  Model rules: The rues followed by the institutional arbitration are model rules of
arbitration as accepted internationally, providing them an edge over ad hoc tribunals in
which the rules are agreed upon by the parties.
 Cost effective: these are more cost effective than ad hoc as in ad hoc arbitration the fees
are charged on sitting-to-sitting basis.
 Low chances of bias: as pointed in the earlier part the ad hoc arbitration’s biggest
disadvantage is bias in proceedings which may be reduced through institutional
arbitration as the party conducting the arbitration would actually be a neutral third party.22

RECOMMENDATIONS TO IMPROVE EFFECTIVENESS OF ARBITRATION IN

GOVERNMENT CONTRACTS

 Preference to institutional arbitration over ad hoc: As has been dealt in the earlier part of
the paper, preferring institutional mode over ad hoc would provide the advantage of
neutrality, cost effectiveness, authenticity in addition to the advantage of arbitration of less
delays making arbitration even more effective way of dispute resolution in government
contracts.
 246th Law commission report23: Further it has been noted in the 246 th Law Commission
Report that:-
“ad hoc arbitrations usually devolve into the format of a court hearing with the
result that adjournments are granted regularly and lawyers too prefer to appear in
court rather than completing the arbitration proceeding. What is therefore
recommended is that India needs to promote institutional arbitration where a
specialized institution with a permanent character aids and administers the arbitral
process”

22
Chauhan, D. (1979). THE POLITICAL AND LEGAL ISSUES OF BINDING ARBITRATION IN
GOVERNMENT. Monthly Labor Review, 102(9), 35-41. Available at: http://www.jstor.org/stable/41841078.
[Accessed on 6 October, 2019].
23
Law Commission of India, AMENDMENT TO ARBITRATION AND CONCILIATION ACT 1996, 246th Law
Commission Report.
ARBITRATION AND CONCILIATION (AMENDMENT) BILL, 2018

The government itself, with a view of increasing effectiveness of the arbitration proceedings in
government contracts has made provisions in the bill for “institutionalization of arbitration”.

It states that the amendment “will facilitate achieving the goal of improving institutional
arbitration by establishing an independent body to lay down standards, make arbitration process
more party friendly, cost effective and ensure timely disposal of arbitration cases.”

The amendment bill provides for:-

 “Facilitation of speedy appointment of arbitrators through designated arbitral institutions

by the Supreme Court or the High Court, without having any requirement to approach the
court in this regard. It is envisaged that parties may directly approach arbitral institutions
designated by the Supreme Court for International Commercial arbitration and in other
cases the concerned High Courts.

 The amendment provides for creation of an independent body namely the Arbitration
Council of India (ACI) which will grade arbitral institution and accredit arbitrators by
laying down norms and take all such steps as may be necessary to promote and encourage
arbitration, conciliation, mediation and other ADR Mechanism and for that purpose
evolve policy and guidelines for the establishment., operation and maintenance of
uniform professional standards in respect of all matters relating to arbitration and ADR
mechanism. The Council shall also maintain an electronic depository of all arbitral
awards,

 The ACI shall be a body corporate.   The Chairperson of ACI shall be a person who has
been a Judge of the Supreme Court or Chief Justice or Judge of any High Court or any
eminent person. Further, the other Members would include an eminent academician etc.
besides other Government nominees,

 It is  proposed to amend  sub section (1) of section  29A by excluding International
Arbitration from the bounds of timeline and further to provide that the time limit for
 arbitral award in other arbitrations shall be within 12 months from the completion of the
pleadings of the parties.

 A new section 42A is proposed to be inserted to provide that the arbitrator and the arbitral
institutions shall keep confidentiality of all arbitral proceedings except award. Further, a
new section 42B protects an Arbitrator from suit or other legal proceedings for any action
or omission done in good faith in the course of arbitration proceedings.

 A new section 87 is proposed to be inserted to clarify that unless parties agree otherwise
the Amendment Act 2015 shall not apply to (a) Arbitral proceedings .which have
commenced before the commencement of the Amendment Act of 2015 (b) Court
proceedings arising out of or in relation to such arbitral proceedings irrespective of
whether such court proceedings are commenced prior to or after the commencement of
the Amendment Act of 2015 and shall apply only to Arbitral proceedings commenced on
or after the commencement of the Amendment Act of 2015 and to court proceedings
arising out of or in relation to such Arbitral proceedings.”

CONCLUSION

ADR is cheaper, more efficient and more party-friendly than courts. It gives people an
opportunity of becoming a part of the dispute resolution mechanism and find the most amicable
solution which cannot be done in a public, formal, adversarial system. When it comes to
arbitration, India has a quite modern and efficient Arbitration and Conciliation Act in place. This
has resulted in continuing popularity of this mechanism of ADR.

Considering the high stakes involved in the government contracts and the resulting disputes,
arbitration becomes a necessity in disputes relating to them. However, for arbitration to be
effective, it is necessary that the agreement is worded clearly and a standardized agreement is not
just enforced. Further, for its effectiveness it need to be ensured that the arbitrator is not a biased
party which may happen in case of ad hoc tribunal being constituted with employees being made
arbitrators. Even the SC in this aspect in the post 2010 era has observed that appointment of
employees may ipso facto be considered to be a biased arbitration.
In this stage however, steps need to be taken to institutionalize arbitration in case of government
contracts to make them more effective and without any bias. This can be achieved by the
enforcement of the Arbitration and Conciliation (Amendment) Bill, 2018.

BIBLIOGRAPHY

 BOOKS
1. Singh A.(2018), LAW OF ARBITRATION AND CONCILIATIN AND ALTERNATIV
DISPUTE RESOLUTION, Eastern Book Company (11 ed.)
 REPORTS
1. Law Commission of India, AMENDMENT TO ARBITRATION AND CONCILIATION
ACT 1996, 246th Law Commission Report.
2. High Level Committee Report to Review the Institutionalism of Arbitration Mechanism
in India.
 WEBSITES
1. http://www.jstor.org/stable/41841078.
2. https://niti.gov.in/writereaddata/files/document_publication/Arbitration.pdf
3. https://ipba.org/media/fck/files/Arbitration%20in%20India.pdf
4. http://www.nja.nic.in/Concluded_Programmes/2016-17/P-1002%20TOC.pdf
5. http://www.hlc.gov.in/Report-HLC.pdf
6. https://dpe.gov.in/sites/default/files/A-423.pdf
7. https://dpe.gov.in/sites/default/files/Guideline-258.pdf
8. https://pib.gov.in/newsite/PrintRelease.aspx?relid=177117
 ARTICLES
1. Chauhan, D. (1979). THE POLITICAL AND LEGAL ISSUES OF BINDING
ARBITRATION IN GOVERNMENT. Monthly Labor Review, 102(9), 35-41.
2. Debroy B. and Jain S., STRENGTHENING ARBITRATION AND ITS ENFORCEMENT
IN INDIA- RESOLVE IN INDIA
3. Kachwaha S., ARBITRATION IN INDIA: AN OVERVIEW
4. Sinha S.B., ADR AND ACCESS OF JUSTICE: ISSUES AND PERSPECTIVE,
 LEGAL DATABASES
 1. www.manupatrafast.com
2. www.scconline.com


 ANNEXURE

Snippets OF INTERVIEW WITH THE JUDICIAL

MEMBER OF C.G. ARBITRATION TRIBUNAL
The author had an incredible opportunity to talk to Retd. J. A. Panda, the Judicial Member of
the Chhattisgarh Arbitration Tribunal. The following is a brief account of the interview.

What is the Chhattisgarh Madhyastham Adhikaran Adhiniyam, 1983?

A.: “Every state India has a statute providing for an institution to deal with cases of arbitration
between the state entity and other party. Hence, the said Act was enacted in Chhattisgarh. The
Act provides for the establishment of The Chhattisgarh Arbitration Tribunal to arbitrate in
disputes to which the State Government or a Public Undertaking wholly or substantially owned
or controlled by the State Government, us a party, and for matters incidental thereto or connected
therewith.”

What is the purpose of enacting such an Act?

A.: Arbitration is the process of bringing a business dispute (valued at Rupees 50,000 or more
relating to any difference arising out of the execution or non-execution of a works contract or
part thereof)24 before a disinterested third party for resolution. The third party here is the
Tribunal constituted by the Act. The tribunal hears the evidence brought by both sides and makes
a decision. It provides the advantage of faster disposal of the dispute and lesser expense.

What is the scheme of the Act?

A.: The Act provides for constitution of the tribunal and the type of matters to be dealt with by
the tribunal. It further provides for qualifications, term of their office, salaries, allowances,
perquisites, etc. It then provides for the procedure to be followed and the components of the
petition brought before the tribunal. It also provides for the tribunal’s powers, bar on jurisdiction
of Civil Courts and finality to the award of the tribunal.

What are the advantages of having such an act in place?

A.: The act has various advantages like:-

 Protection of the tribunal: against any prosecution against acts done in good faith or
intended to be done under the Adhiniyam. This would provide the members with a sense
of security helping them in acting honestly and without any bias or pressure.
24
Section 2(d).
  Efficiency of proceeding: It is provided under Section 14 that no proceeding before the
tribunal may be challenged except under circumstances affecting the merits of the
case.This would provide timely and efficient disposal of cases and reduce the burden on
the higher judiciary
 Autonomity: Under Section 12, with respect to evidence, the Tribunal is provided with
the powers of the civil court. Also, it has been provided under Section 18 that the award
of the tribunal is provided the force of decree of District Court.

 Power to give criminal punishments: The Tribunal under Section 24 has been provided
with the power to initiate criminal punishments for contempt, giving false evidence,
Omission to produce document, Refusing oath, Refusing to answer public servant
authorised to question, Refusing to sign statement, Refusing to answer or produce
document, non- attendance by a witness in obedience to summons.
 Transparency: Transparency instills confidence in the public and Section 27 provides
exactly that.

Are their some ways in which the Act may be made more effective?

A.: Most of the Acts providing for establishment of State Arbitration Tribunals lack the
following aspects:-

 Explicit provisions should be enacted providing for appeal and review procedure.
 Specific provisions related to interim orders should be made while keeping in mind the
Arbitration and Conciliation Act, 1996.

Provisions should be made egarding these to make the arbitration process more effective.