Context: An expert committee, headed by Dr. T.K. Vishwanathan, set up by the Centre on reforms in the Arbitration and Conciliation Act, 1996, submitted its final report to the government.
Recommendations given by the Dr. T.K. Vishwanathan committee:
- Resolution on corporate disputes can be fast-tracked by creating a separate Arbitration Division in every High Court with regular proceedings and decisions taken expeditiously.
- Unless there is a stay on enforcement, the enforcing Court should dispose of the petition in nine months and adjournments in proceedings must be granted sparingly only for exceptional reasons.
- The committee has recommended a model procedure based on prevalent best practices. This model procedure can be used by the arbitral tribunals as a guide.
- While the oversight by a court is essential to the legitimacy and integrity of the arbitral process, its role must be limited to overall supervision, and a second-look at the post-award stage.
- There is an urgent need to institutionalise the process of appointment of arbitrators, and minimise court intervention at the very first stage. The courts should endeavour to dispose of applications for appointment of arbitrators without much delay.
- No upper age limit has been prescribed for accepting appointment as arbitrator.
- The arbitrators’ fees were fixed under the Fourth schedule, the Committee has suggested the government provide different fee structures for small and medium value claims and revise the rates periodically to meet the needs of changing times without the need to amend the Act.
- Any decision to challenge an arbitral award must be based on an honest assessment about the prospects of success, as weighed against the estimated cost of litigation.
- The legal personnel in charge of arbitration must find and explain why they are challenging something, and they should assess how likely they are to succeed with the help of a senior lawyer. They should also regularly check how their challenges to arbitration decisions are going.
- As an alternative, a standing committee of officers may be appointed to immediately examine an award after it is delivered, to decide whether to challenge it, or attempt to settle it.
- Fortnightly reviews of all arbitral awards must be undertaken to ensure that the timeline for challenging an award does not expire.
- Suggesting a separate law for domestic disputes as the UNCITRAL (United Nations Commission on International Trade Law) Model Law is based mainly on the experience of western countries where arbitrations are mostly conducted under the auspices of arbitral institutions.