Arbitration Council of India – Amendment Act (2019)

By BYJU'S Exam Prep

Updated on: November 14th, 2023

The Arbitration Council of India was established to fulfill the duties and functions prescribed under the Arbitration and Conciliation Act. Arbitration in law refers to settling disputes between two parties through an ‘Arbitrator’ who delivers a binding award (decision) after carefully evaluating such arguments. Since the settlement is done outside the court, it saves time and money for the litigants.

The Arbitration and Conciliation Act 1996 prescribes the rules to be followed during the arbitration. It was amended with the Arbitration and Conciliation (Amendment) Act, 2019, which came into effect on 9th August 2019. Part 1A of this Act contains detailed domestic and international arbitration guidelines and proposes setting the Arbitration Council of India to oversee conciliation proceedings in India.

What is the Arbitration Council of India?

The Arbitration Council of India was proposed to streamline and encourage institutional arbitration and promote India’s Alternative Dispute Resolution (ADR) mechanism.

Arbitration Council of India PDF

Among the three ADR processes, neutral evaluation, mediation, and arbitration, arbitration is the most popular way of dispute resolution outside the court of law. The function of Arbitration Council of India includes framing policies for grading and rating the performances of arbitral institutions.

Establishment of Arbitration Council of India

The central government can designate the Arbitration Council of India as per section 43B of the Arbitration and Conciliation Act, 1996, for executing the tasks and roles specified under the Act.

Arbitration Council of India is a body constituted with an unchanging sequence, a standard monogram, and the same capacity to obtain, bear and dispose of both transferable and unmovable property as specified in the Arbitration and Conciliation Act, 1996.

Function of Arbitration Council of India

  • It also accredits arbitrators according to the norms and qualifications mentioned in the Eighth Schedule of the 2019 Act.
  • The Council determines the policy for the operations of the establishment.
  • Its primary objective is to maintain uniform professional standards for everything related to arbitration and the ADR mechanism.
  • Furthermore, the Council also conducts workshops and training to encourage the ADR mechanism.
  • Make recommendations to the central government about the Arbitral Council of India’s staff, training, and infrastructure.

Composition of Arbitration Council of India

Any Supreme Court Judge, High Court Chief Justice, High Court Judge, or any renowned person with special knowledge of arbitration administration can be appointed as the Chairperson. However, the Central Government must make the appointment after consulting the Chief Justice of India.

  • A reputed arbitration specialist with ample knowledge of domestic and international institutional arbitration can be appointed as a Member.
  • An experienced academician with teaching and research exposure in arbitration and ADR laws can be appointed Member.
  • An officer having the rank of Joint Secretary to the Government of India or above must be appointed an Ex-Officio Member.
  • Any representative of a recognized trade and enterprise body must be appointed a part-time Member.
  • The Chief Executive Officer-Member-Secretary must be appointed as an Ex-Officio Member.

Arbitration Council of India Chairman

ACI is governed by the Chairperson, who the Central Government will select in consultation with the Chief Justice of India. The chairman should be from the following classifications:

  • A judge from the Supreme Court or
  • A judge from a High Court or
  • Chief Justice of a High Court or
  • A superior person with an expert understanding of arbitration.

Arbitration Council of India – Term of the Members

According to the Arbitration and Conciliation (Amendment) Act 2019, the Chairperson of Arbitration Council of India and all Members must stay in office for three years from the date of joining office.

  • Also, no Member, Ex-Officio Member, or Chairperson will be allowed to hold office after attaining the age of seventy (70) years (for Chairperson) and sixty-seven (67) years (for Members).
  • The Arbitration Council of India has been formed to simplify the court procedures regarding arbitration and strengthen the Alternative Dispute Resolution mechanism.
  • The Council’s headquarters are located in Delhi and are opening offices in major Indian cities.
  • The central government appoints the Chairperson of the Arbitration Council of India after consultation with the chief justice of India.

Member Removal of Arbitration Council of India

The removal of the Arbitration Council of India 2019 member occurs under the listed circumstances:

  • If he is unable to pay debts owed, or
  • If he has pledged in any paid occupation during his tenure of office (excluding part-time Member), or
  • If he has been sentenced for a crime involving ethical corruption as per Central Government opinion, or
  • If he has obtained some economic or other interest that is likely to impact the discrimination of his roles as a member, or
  • If he has maltreated his position
  • If he has become unfit to maintain his functions physically or mentally.

No member shall be terminated on grounds (4) and (5) unless the Supreme Court, on the suggestions of the Central Government, has objected that the Member should be removed on such grounds.

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