ICA ARBITRATION CLAUSE

The Indian Council of Arbitration recommends to all parties desirous of making reference to arbitration by the Indian Council of Arbitration, the use of the following arbitration clause in writing in their contracts:

"Any dispute or difference whatsoever arising between the parties out of or relating to the construction, meaning, scope, operation or effect of this contract or the validity or the breach thereof shall be settled by arbitration in accordance with the Rules of Arbitration of the Indian Council of Arbitration and the award made in pursuance thereof shall be binding on the parties."

DEFINITIONS

Rule 1

(i) These rules may be called the "Rules of Arbitration of the Indian Council of Arbitration."


(ii) These rules shall apply where parties have agreed in writing that (a) a dispute has arisen or (b) a dispute which may arise between them in respect of defined legal relationship whether contractual or not, shall be settled under the Rules of Arbitration.

Rule 2

In these rules, the following words have the following meanings:

(i) "Arbitral Tribunal" means an arbitrator or arbitrators appointed for determining a particular dispute or difference.
(ii) "Arbitral Award" includes an interim award.
(iii) "Committee" means the Arbitration Committee of the Council as provided for hereinafter.
(iv) "Council" means the Indian Council of Arbitration.
(v) "Governing Body" means the Governing Body of the Council.
(vi) "Guidelines" means the guidelines for arbitrators and the parties to arbitration for expeditious conduct of the arbitration proceedings, given in the Annexure to these Rules.
(vii) "International Commercial Arbitration" means an arbitration relating to disputes arising out of legal relationships, whether contractual or not, considered as commercial under the law in force in India and where at least one of the parties is (a) an individual who is a national of, or habitually resident in, any country other than India; or

(b) a body corporate which is incorporated in any country other than India; or (c) a company or an association or a body of individuals whose central management and control is exercised in any country other than India, or (d) the Government of a foreign country.

(viii) "Party" means a party to an arbitration agreement. It shall include any individual, firm, company, Government, Government organisation or Government Undertaking.
(ix) "Panel" means the Panel of Arbitrators maintained by the Council.
(x) "Registrar" means the Registrar for the time being appointed by the Committee and includes such other persons as the Committee may nominate for carrying out the duties of the Registrar under these rules.
(xi) "Rules" means the Rules of Arbitration of the Council.
(xii) "Rules of Conciliation" means the Rules of Conciliation of the Council.
(xiii) "Fast Track Arbitration" means arbitration in accordance with Rule 44.
(xiv) Words importing the singular number include, where the context admits or requires, the plural number and vice versa.

ARBITRATION COMMITTEE

Rule 3

(a) The Governing Body of the Council shall constitute an Arbitration Committee for performing the functions prescribed under these Rules. The Committee shall consist of the President of the Council, who shall be the ex officio Chairman of the Committee and three members of the Governing Body of the Council elected by the Governing Body from amongst themselves. The Committee shall hold office for a year.

(b) The Committee may co-opt not more than two persons to be additional members of the Committee during its terms of office. Persons who are not members of the Governing Body may also be co-opted to be members of the Committee.

(c) The Committee or the Chairman of the Committee may delegate to the Registrar the power to take certain decisions, provided that any such decision shall be reported to the Chairman or the Committee as the case may be.

RULES APPLICABLE

Rule 4

(a) Any dispute relating to any commercial matter including shipping, sale, purchase, banking, insurance, building construction, engineering, technical assistance, know-how, patents, trade marks, management consultancy, commercial agency, or labour, arising between two or more parties in India or a party or parties in India and a party or parties in a foreign country or between foreign parties who agree or have agreed for arbitration by the Council, or under the Rules of Arbitration of the Council, shall be determined and settled in accordance with these Rules.

(b) The Council shall also be competent to administer the conduct of arbitration in any dispute or difference relating to a commercial transaction between parties as mentioned in sub-clause (a) where they have agreed to have their dispute arbitrated under any other Rules of Arbitration and have agreed to have such arbitration administered by the Council, wholly or in respect of some matters arising out of such arbitration.

(c) In case the parties have provided different procedure for appointment of arbitrator or schedule of cost including the arbitrator's fee, the Council shall not be bound to process the case unless both the parties agree to follow the entire procedure of arbitration under Rules of Arbitration of the Council.

(d) The Council shall be competent to function as Appointing Authority as contemplated under the Arbitration Rules of the United Nations Commission on International Trade Law (UNCITRAL).

Rule 5

Wherever the Parties have provided or agreed for arbitration by the Indian Council of Arbitration or for arbitration under the Rules of Arbitration of the Council, these rules or any amendment thereof, in the form obtaining at the time the dispute is referred to arbitration of the Council, shall apply.

Rule 6

If one or both of the parties to a dispute which is referred to arbitration by the Council belong to a country or countries other than India, in the absence of an agreement by the Parties on the substantive law to be applied, it will be determined by the arbitral tribunal. The procedural law shall be the laws of India and parties shall be deemed to have submitted to the jurisdiction of the Courts in India.

Rule 7

Any chamber of commerce, trade association or any arbitral or other organisation may adopt these Rules by making them generally available to its members or by applying them to any dispute in which any of its members may be parties or by normally conducting its arbitration under these Rules.

INTERPRETATION OF THE RULES

Rule 8

The decision of the Committee on any question relating to interpretation of these rules or any procedural matter there under shall be final and binding on the parties.

PANEL OF ARBITRATORS

Rule 9

A Panel of Arbitrators shall be appointed by the Committee from amongst persons who are qualified and possesses knowledge and experience in their respective field of profession and arbitration law & procedure and are willing to serve as arbitrators generally or in specific fields and who are from time to time recommended by the members of the Council or any other person or organisation.

All the members of the Panel will carry equal status and parties will not have any right to challenge the appointment of the arbitrator on the ground that its nominee arbitrator has higher status than the Presiding Arbitrator.

Rule 10

The Registrar shall prepare and maintain an up-to-date Panel of Arbitrators together with adequate information as to their qualifications and experience. Separate lists may be kept and maintained of arbitrators included in the Panel for disputes in general and for each of the fields of international trade and/or business transactions in which the Governing Body decides that the Council will offer arbitration facilities under the Rules.

The parties to a dispute or the Registrar where he appoints the arbitrator may choose any person from the panel with reference to any dispute. If any party appoints a foreigner/person residing abroad, as arbitrator from the panel, that party will have to meet the travel & stay expenses of the person appointed as arbitrator at the venue of arbitration. The arbitral tribunal may, however, make any order in regard thereto in the award. The panel of Arbitrators shall be open to inspection by all persons with the permission of the Registrar.

Rule 11

The Committee may at any time add the name of any person to the list of arbitrators included in the Panel or delete the name of any person from the panel.

Rule 12

The Chairman of the Committee may include the name of any person in the panel, in case it is required in any particular case. His continuance in the Panel will be decided by the Committee.

Rule 13

The persons who have attained the age of more than 80 years will automatically cease to be member of the Panel of Arbitrators. In the case of a person, who has been appointed as Arbitrator before attainment of the age of 80 years, his panel membership will continue till the pronouncement of the Award in pending arbitration matters referred to him.


DUTIES OF THE REGISTRAR

Rule 14

(a) The Registrar shall receive applications for arbitration by the Council, receive payment of fees and deposits, appoint, in consultation with the Chairman of the Committee, and in his absence in consultation with the member of the Governing Body designated by him, an arbitrator or arbitrators as hereinafter provided. The Registrar shall also receive all communications made to the arbitral tribunal by the parties and communicate to them the orders and directions of the arbitral tribunal, keep a register of applications to the Council and of awards made by the arbitral tribunal, keep such other books or memoranda and make such other records or returns as the Committee shall from time to time require and generally carry out the directions of an arbitral tribunal so constituted under these rules and take such other steps as may be necessary to assist such arbitral tribunal in the carrying out of its functions.

(b) The Registrar may delegate to any officer of the Council, Chambers of Commerce or Trade Association at the premises of which the arbitration proceedings are taking place, to discharge such of the functions and administrative duties of the Registrar as are deemed proper and necessary from time to time, with reference to a particular case or cases.

INITIATION OF ARBITRATION

Rule 15

(i) Any Party wishing to commence arbitration proceedings under these rules (Claimant) shall give a notice of request for arbitration to the Registrar of ICA and to the Respondent.
(ii) The notice of request (application) for arbitration to the Registrar shall be accompanied by:-
(a) the names and full addresses of the parties to the dispute.
(b) statement of the claim and facts supporting the claim, points at issue and relief or remedies sought with other details of the claimant's case.
(c) original or duly certified copies of the arbitration agreement, any contract or agreement out of or in connection with which the dispute has arisen and such other documents and information relevant or relied upon.
(d) Registration fee of Rs. 2,500/- for claim upto Rs. One Crore and Rs.5,000/- for claim more than Rs. One Crore.
(e) The Arbitration shall be deemed to have commenced on the day the application for arbitration, registration fee and statement of claim are received in the office of the Council.

Rule 16

If any Court makes an order directing that an arbitration be held under these Rules, in addition to the documents listed in Rules 15, the order of that Court or a copy thereof shall accompany the application for arbitration.

Rule 17

(a) On receipt of an application for arbitration, the Registrar shall have absolute discretion to accept or reject the said application. The Registrar is not bound to give reasons for the exercise of his discretion.

Before deciding on the acceptability of an application for arbitration, the Registrar may ask the parties for further information and particulars of their claims.

(b) Similarly, if any information or particulars regarding the arbitration agreement furnished by claimant with the application for arbitration are found to be incorrect or false, at any time subsequently, the Registrar shall have a like power to reject the application for arbitration.

(c) Any Party aggrieved by the decision of the Registrar, in accepting or rejecting an application for arbitration as above, may apply to the Court for suitable directions.

DEFENCE STATEMENT

Rule 18

(a) On receipt of the application together with the claim statement, the Registrar shall send to the other Party (Respondent) a copy of the claim statement and attached documents and ask such other party to furnish within thirty days or within any extended date, a defence statement setting out his case accompanied by all documents and information in support of or bearing on the matter.

(b) Any communication sent by the Registrar under Registered Post to the Respondent on the address appearing in the Arbitration Agreement/the contract between the parties, as per the information supplied to the Council, will be deemed to be duly served on the Respondent, if it is delivered to the addressee personally or at his place of business, habitual residence or mailing address last known, even if the Respondent refuses to accept the said communication or if it is returned to the Council by the postal authorities as unclaimed by the said party. The Registrar may proceed further with the arbitration proceedings as per the rules as if such communication had been duly served on the concerned party. The Registrar may in such cases make an additional communication to the Parties by Registered Letter or by other means which may provide a record of attempts to deliver it.

(c) A copy of the defence statement and all appended documents, if any, shall be sent to the Claimant for information.

(d) The communication is deemed to have been received on the day it is so delivered.

COUNTER-CLAIM AND REPLY TO COUNTER-CLAIM

Rule 19

(a) The Respondent may make a counter-claim against the Claimant provided the counter-claim arises under the same transaction as the original claim. He must submit the counter-claim with full details supported by all documents and information as in the case of the claim under Rule 15 within the period laid down for the defence statement to the claim and the Claimant may within twenty-one days of the notification of the counter claim or within such extended time submit a statement in reply to the counter-claim. The arbitral tribunal appointed to adjudicate upon the original claim shall also adjudicate upon the counter-claim and there will be no change in the number of members of arbitral tribunal already constituted on the basis of original claim.

(b) Copy of the reply of the Claimant to the counter-claim and all appended documents, if any, shall be sent to the Respondent for information.

COPIES OF STATEMENTS, ETC.

Rule 20

All statements, replies and other documents and papers submitted by the parties and all appended documents must be supplied in triplicate. Where there is more than one arbitrator or more than one opposing party, the parties shall within the time specified furnish to the Registrar such number of further copies as may be required by the Registrar.

CONSTITUTION OF THE ARBITRAL TRIBUNAL

Rule 21

On receipt of the application for arbitration, the Registrar shall take necessary steps to have the arbitral tribunal constituted for the adjudication of the dispute or difference as provided hereunder.

Rule 22

The number of arbitrators to hear a dispute shall be determined as under:

(a) Where the claim including determination of interest, if any, being claimed upto the date of commencement of arbitration in terms of Rule 15, does not exceed Rs. One crore and where the arbitration agreement does not specify three arbitrators, the reference shall be deemed to be to a sole arbitrator, unless the parties to the dispute agree to refer the dispute to three arbitrators within thirty days from the date of notification of request for arbitration.

(b) Where the claim including determination of interest, if any, being claimed upto the date of commencement of arbitration in terms of Rule 15 exceeds Rs. One crore, the dispute will be heard and determined by three arbitrators, unless the parties to the dispute agree to refer the dispute to a sole arbitrator within thirty days from the date of the notification of the request for arbitration.

(c) Where three arbitrators have to be appointed as per the above sub-rule and any of the parties to the dispute fails to make the necessary deposit towards the cost and expenses of arbitration, instead of three arbitrators, the Registrar may appoint a sole arbitrator, where the claim is upto One crore. Where the claim is for more than Rs. One crore, the Registrar may appoint arbitrator/s on behalf of the Respondent as well the as Presiding Arbitrator.

Rule 23

The appointment of sole arbitrator or three arbitrators shall be made in the following manner:

(a) In case a Sole Arbitrator has to be appointed, the Registrar shall, by a notice in writing, call upon the parties to the dispute to forward the name of an agreed arbitrator from among the Panel of Arbitrators. The said notice shall specify the period within which the nomination shall be made which shall not be more than thirty days from the date of the said notice to the respective parties. If the parties fail to agree on the person to be appointed as sole arbitrator within the time granted by the Registrar, the Registrar in consultation with the Chairman of the Committee and in his absence in consultation with the member of the Governing Body designated by the Chairman, shall appoint the sole arbitrator from among the Panel of Arbitrators. If one of the parties is a national or resident of a country other than India, the sole arbitrator shall, as far as possible, be chosen or appointed by the Registrar from among the nationals of a country other than that of either of the parties. The sole arbitrator so nominated shall constitute the arbitral tribunal to hear the dispute and shall be appointed as such in writing by the Registrar. The Registrar shall give notice to the Parties of the constitution of the arbitral tribunal.

(b) Where the reference is to three arbitrators, the Registrar shall in the first instance call upon the parties to nominate one arbitrator each from among the Panel of Arbitrators by a notice in writing, sent to them. The said notice shall specify the period within which the nomination shall be made which shall not be more than thirty days from the date of the said notice to the respective Parties. If a Party to the dispute refuses or neglects to appoint an arbitrator on his behalf within the period specified or if he requests the Registrar to nominate an arbitrator on behalf of that party, the Registrar in consultation with the Chairman of the Arbitration Committee and in his absence in consultation with the members of the Governing Body designated by the Chairman shall appoint the arbitrator from the Panel of arbitrators on behalf of that party. On receipt of the nominations from the respective parties or on the appointment as aforesaid by the Registrar, the Registrar shall appoint another person as the Presiding Arbitrator of the arbitral tribunal in consultation with Chairman of the Committee and in his absence in consultation with members of the Governing Body designated by the Chairman, from among the panel of arbitrators to be additional arbitrator to act as Presiding Arbitrator of the arbitral tribunal.

(c) If one of the parties is a national or resident of a country other than India, the additional arbitrator shall, as far as possible, be chosen or appointed from among the nationals of a country other than that of either of the parties. The arbitrators so nominated or appointed shall constitute the arbitral tribunal and shall be appointed as such in writing by the Registrar. The additional arbitrator appointed by the Registrar shall act as Presiding Arbitrator of the arbitral tribunal. The Registrar shall give notice to the parties of the constitution of the arbitral tribunal.

Rule 24

The parties will obtain the consent from the persons nominated by them as arbitrator and intimate the Council accordingly. The Registrar will obtain the consent from person(s) nominated by him. After a person gives his consent for appointment as arbitrator, he will be duly intimated about his appointment to decide the dispute, by a Memo in writing under the hand of the Registrar about the constitution of the arbitral tribunal. The appointment of the arbitrator will take effect from the date of such intimation about the constitution of the arbitral tribunal.

Rule 25

Before accepting his nomination the prospective arbitrator shall disclose any circumstances such as financial or personal interest in the outcome of the award, likely to disqualify him as an impartial arbitrator. Upon receipt of such information, the Registrar shall disclose it to the parties, who if willing to proceed under the circumstances disclosed, shall advise the Registrar accordingly. If either party declines to waive the presumptive disqualification, the prospective arbitrator shall be disqualified from acting as arbitrator and the vacancy so created shall be filled, in accordance with the applicable provision of these Rules.

Rule 26

Any Party shall have the right to challenge the appointment of an arbitrator on receipt of the notice of his appointment for reasons which disqualify the arbitrator. The Challenge of an arbitrator shall be made within 30 days after his appointment has been communicated to the challenging party or within 30 days of his becoming aware of the reasons for which the challenge is made. Copies of the communication of challenge shall be sent to the other Parties and the arbitrators. The Committee shall be the sole judge of the grounds of challenge and its decision shall be final and binding on the Parties.

Rule 27

(a) If any appointed arbitrator resigns or dies or becomes incapable of acting or neglects or fails to act expeditiously, prior to or during the arbitration hearings, or if he fails to make the award within the prescribed time and the Parties do not agree to extend the time for making the award, the Registrar in consultation with the Arbitration Committee may terminate the authority of such an appointed arbitrator and inform him accordingly.

(b) In case of the resignation or death or termination of authority of an appointed arbitrator under Sub-Rule(a) above, a new arbitrator will be appointed in his place by the Registrar in case he had appointed the original arbitrator. Where the appointment was made by the Parties, the Registrar shall call upon the Party who had appointed the arbitrator to nominate another arbitrator in his place. If any Party refuses or neglects to nominate an arbitrator within 15 days of the date of notice requiring him to nominate the arbitrator or within such extended time, the Registrar shall nominate the arbitrator on behalf of that Party from among the Panel of Arbitrators.

(c) The arbitrator(s) appointed as above will be informed about the reconstitution of the arbitral tribunal and the reconstituted arbitral tribunal shall make the award expeditiously within the time prescribed under Rule 63 from the date when the reconstituted arbitral tribunal enters on the reference. The reconstituted arbitral tribunal shall proceed with the arbitration with the liberty to act on the record of evidence and proceedings as then existing or to commence the proceedings de novo.

DEPOSITS

Rule 28

The Registrar may require the Parties before passing the case on to the arbitrators under Rule 38, to deposit in advance in one or more installments such sums of money as he deems necessary to defray expenses of the arbitration including the administrative charges and arbitrator's fee. As a general rule, the deposits shall be called for in equal shares from the Claimant(s) and the Respondent(s). The arbitral tribunal may, during the course of the arbitration proceedings or in the arbitration award, require further sums to be deposited by the Parties or any one of them to meet the expenses of the arbitration. When one of the Parties neglects or refuses to make the deposit, the Registrar or the arbitral tribunal, as the case may be, may require such deposit whether in relation to a claim or a counter-claim, to be made by the other Party to the dispute (Claimant or Respondent as the case may be). Should the whole or part of the deposit be not made by the Parties or any one of them, the Registrar shall inform the Parties or the Party concerned that the claim or counterclaim, as the case may be, will not be the subject matter of the reference. The arbitral tribunal shall proceed only in respect of those claims or counter-claims for which the deposits has been duly paid to the Council and otherwise may order the suspension or termination of the arbitral proceedings.

All deposits towards costs and expenses shall be made with the Council and no payment shall be released to the arbitrators directly by the parties. The deposit made shall be taken into account by the arbitral tribunal in apportioning the cost while making the award. Any deposit made in excess shall be refunded to such of parties as the arbitral tribunal may direct. The Council shall have a lien for the arbitral award on any unpaid cost of the arbitration.

FEES AND EXPENSES

Rule 29

The arbitral tribunal shall be entitled to allow fees and expenses of witnesses, expenses connected with the selection and carriage of sample and examination of goods, Licensed Measureís Department charges, conveyance, hire, cost of legal or technical advice or proceedings in respect of any matter arising out of the arbitration incurred by the arbitral tribunal, and any other incidental expenses and charges in connection with or arising out of the reference or award as the arbitral tribunal shall, in its absolute discretion, think fit.

Rule 30

The costs of the reference and the award including charges, fees and other expenses shall be in the discretion of the arbitral tribunal, which may direct to and by whom, and in what proportion, such charges, fees and other expenses and any part thereof shall be borne and paid, and may tax and settle the amount of costs to be so paid or any part thereof and may award costs to be paid as between solicitor and client. In the event, any administrative fees and expenses are due to the Council, the arbitral tribunal may award them in favour of the Council.

Rule 31

The fees, costs and expenses incidental to the reference and the award shall include the following :

(1) Registration Fee

The Registration fee shall be payable with regard to the amount in dispute in each case as hereunder. The registration fee will not be refunded and becomes the property of the Council.

Rs.5,000/- upto Rs. One Crore claim

Rs.10,000/- more than Rs. One Crore claim

(2) Administrative Fee and Arbitratorís Fee

The Administrative fee (of ICA) and Arbitratorís fee (for each arbitrator) will be fixed separately with regard to the amount in dispute including determined interest in each case, as under:

(3) In addition to the above the ICA will be entitled to receive a Special Fee of Rs.2, 500/- per hearing for providing facilities of hearing rooms, for arbitration hearings and secretarial assistance etc. at the arbitration hearing.

(4) Notwithstanding the provisions in Sub-Rule (2) of this Rule, the Committee/Chairman of the Committee may prescribe the Arbitrator's fees and the Administrative fees of the Council at a figure higher than those prescribed in the said Sub- Rules, if in the exceptional circumstances of the case this appears to be necessary.

(5) Notwithstanding the provision in Sub-Rule (2) hereinabove, in arbitration cases to which Rule 39 applies, the Arbitrator's fee and the Administrative fee of the ICA will be fixed by computing the fee applicable to larger claim in addition to 60% of the applicable fees of all claims being tried jointly. Provided that the Committee will have the power to prescribe the Arbitrator's Fee and Administrative Fee under this Sub-Rule in any other manner, having regard to the nature and facts of the matters under reference.

Rule 32

Other expenses : The arbitrator may be paid an amount of Rs. 750/- towards local conveyance for attending each arbitration hearing in the city of his residence. In respect of joint trial, the hearing will be treated as one irrespective of the number of cases. Any traveling and other expenses incurred by the arbitrator or the Registrar for attending the arbitration hearings in a city other than the place of residence, shall also be reimbursed to him as provided hereinafter. All the above expenses shall form part of the arbitration costs.

Rule 33

(1) An arbitrator who has to travel shall be paid travelling expenses by air or rail (air conditioned wherever available) or car (when neither air nor rail transport is available) at actuals. In addition, he may be paid out-of-pocket expenses at actuals for boarding, lodging and local transport subject to maximum of Rs. 6,000/- per day in metropolitan towns, Rs.3,000/- in class A cities and Rs. 2,000/- in other cities. An arbitrator who makes his own arrangements for boarding, lodging, local transport etc. may be paid out of pocket expenses at the rate of Rs.1,000/ - per day, without production of vouchers. The limits for stay of the Registry officials will be of those applicable to arbitrators.

(2) The cost to be incurred on payment of expenses referred to in Sub-Rule (1) to an arbitrator nominated by a party will be borne and paid by the party nominating the arbitrator. However, if an appointed arbitrator changes his residence after his nomination by a party, he will not be entitled to reimbursement of any enhanced expenses for attending the arbitration hearing, unless the party nominating him agrees to reimburse the same to him. The expenses payable to the third arbitrator or sole arbitrator appointed by the Council under Rule 23(a) & (b) will be borne and paid by both the parties in equal proportion or in such other manner as may be determined by the Arbitral Tribunal.

Rule 34

Where the arbitration proceedings under an adhoc arbitration or under the rules of arbitration of any other arbitral organisation or otherwise are administered by the Council wholly or in respect of some matters arising out of such arbitration, the Council may charge an appropriate fee for such administration and other services.

Rule 35

The amount of the claim shall be stated in the application by the party applying for arbitration. If the amount is stated in a currency other than the rupee, it shall be converted into Rupees, at the current official rate of exchange.

Rule 36

Where the sum under dispute is not stated or in arbitration proceedings where the relief claimed is other than a money claim, viz., a declaratory claim, the Registrar and the Arbitral Tribunal under Rule 28, may require such deposits as may be deemed necessary to be paid by such of the parties as may be required subject to later adjustment.

Rule 37

The amount of interest, wherever specified, will be included in the claim amount for the purpose of calculation of administrative fee. Further, claims and counter-claims referred for arbitration shall be taken into consideration separately for the purpose of calculation of arbitrator as well as administrative fees under Sub Rule 31(2).

SUBMISSION OF THE CASE TO THE ARBITRAL TRIBUNAL

Rule 38

The Registrar shall send copies of all papers relating to arbitration such as claim statement, defence statement, counterclaims, reply, statements, or other documents received from the parties to the dispute to the Arbitrator/Arbitrators constituting the Arbitral Tribunal under Rule 22 with a request to proceed with the arbitration and the arbitral tribunal shall be deemed to have entered on the reference on the day on which applications, defence statement, counter-claims, replies, documents, etc. have been dispatched to the Arbitrator/Arbitrators. Intimation shall be given to the Parties of the day on which the Arbitral Tribunal is deemed to have entered on the reference.

If the Claimant does not file all the requisite documents, papers, etc. or does not deposit the appropriate fees as per the Rules after having been given due opportunity for the purpose by the Registrar or the arbitral tribunal, the Registrar or the arbitral tribunal may dismiss/close the case on file for lack of pursual by the Claimant. Similarly, if the Respondent fails to produce any requisite documents, papers including the statement of defence or information or fails to deposit administrative fees, or arbitrators fees etc. after having been given due opportunity for the purpose by the Registrar or the arbitral tribunal, the Registrar or the arbitral tribunal may proceed further with the arbitration proceedings as per the Rules, notwithstanding such failure or refusal by the Respondent.

Rule 39

Where there are two or more applications for arbitration by the Council and the issue involved in the dispute arises out of same transactions, the Registrar may, if he thinks proper to do so and with the consent of the Parties, fix the hearings of the disputes to be heard jointly or refer the applications to the same Tribunal. The awards, however, shall be given separately in each case.

NOTIFICATIONS AND/OR COMMUNICATIONS FROM THE REGISTRAR

Rule 40

All applications which the parties desire to make to the arbitral tribunal and all notices to be given to the Parties before or during the course of arbitration or otherwise in relation thereto shall be made through and sent by the Registrar who shall communicate the orders and directions of the Arbitral Tribunal thereon to the Parties.

AMENDMENT OF CLAIMS, ETC.

Rule 41

Amendments of the claim, defence statement, counter-claim or reply submitted to the Arbitral Tribunal must be formulated in writing by the Party so desiring. The Arbitral Tribunal will decide whether such amendments should be allowed or not. The Administrative fee and Arbitrator's fee (for each Arbitrator) shall get revised to the extent of increase for such additional claims/counter-claims. The party making such additional claim/counter-claim shall deposit the entire fees payable in respect of such increase of additional claim as set out in the schedule of fees in Rule 31(2).

PLACE OF ARBITRATION

Rule 42

The place or venue of arbitration shall be India. The Arbitration proceedings shall be held at such place or places in India as the Arbitral Tribunal may determine having regard to the convenience of the Arbitrators and the Parties. In a case in which one or both the Parties are from overseas, the Arbitration proceedings may also be held at any place outside India at the discretion of the Arbitral Tribunal.

PROCEEDINGS BEFORE THE ARBITRAL TRIBUNAL CONCILIATION

Rule 43

Optional Conciliation: The parties may opt for conciliation and request the arbitral tribunal before the commencement of the arbitration proceedings unless they have already agreed otherwise, to settle their dispute through conciliation as per Rules of Conciliation of the Council.

FAST TRACK ARBITRATION

Rule 44

Fast Track Arbitration : The Parties may opt for Fast Track Arbitration and request the arbitral tribunal, before the commencement of the arbitration proceedings, to decide the reference in a fixed time frame of 3 to 6 months or any other time agreed between the Parties, according to the Fast Track Arbitration procedure, as under:

(1) The arbitral tribunal will be authorised to decide the dispute on the written pleadings, documents and written submissions filed by the Parties without any oral hearings.
(2) The arbitral tribunal shall have power to call for any further information/clarification from the parties in addition to the pleading and documents filed by them.
(3) An oral hearing may be held if both the parties make a joint request or if the Arbitration tribunal considers an oral hearing necessary in any particular case.
(4) If an oral hearing is held, the arbitral tribunal may dispense with any technical formalities and adopt such procedure as it deems appropriate and necessary for economic and expeditious disposal of the case.

Rule 45

At a hearing, a party shall be entitled to appear by counsel, attorney, advocate or a duly authorised adviser or representative or personally. However, where the dispute is purely of a commercial nature, the parties shall have no right to be represented by lawyers except where, having regard to the nature or complexity of the dispute, the arbitral tribunal considers it necessary in the interest of justice that the parties should be allowed to be represented by counsel, attorney or advocate.

Rule 46

The arbitral tribunal may proceed with the reference notwithstanding any failure by a party to comply with any of the directions of the arbitral tribunal and may also proceed with the arbitral proceedings in the absence of any or both the Parties who fail or neglect to attend at the time and place appointed by the arbitral tribunal, in spite of due notice.

Rule 47

The parties shall do all acts necessary to enable the arbitral tribunal to make an award expeditiously and shall not do or cause or allow to be done, any act which will delay the proceedings or prevent arbitral tribunal from making an award expeditiously, and if any party does cause or allow to be done any such act, that party shall pay such costs as the arbitral tribunal deems reasonable.

Rule 48

The arbitration session will go on as far as possible on a day-to-day basis from 10.30 a.m. to 4.30 p.m once the hearing begins after completion of all the formalities. The arbitral tribunal shall not ordinarily adjourn a hearing at the request of any party, except where the circumstances are beyond the control of the party and the arbitral tribunal is satisfied that reasons and circumstances for the adjournment are justified. While granting an adjournment, the arbitral tribunal may make such orders regarding payment of costs by one or both of the parties, as it deems fit and reasonable.

Rule 49

If the parties have agreed to submit their case to arbitration under these Rules and any party refuses or fails to take part in the arbitration proceedings, the arbitral tribunal may proceed with the arbitration notwithstanding such refusal or absence.

Rule 50

The arbitral tribunal may at its discretion at any time or times before making the final award and at the expense of the parties concerned, consult any person having special knowledge relating to the particular industry, commodity, produce or branch of trade concerned in the reference or any expert or qualified accountant and may also at the like expenses of the Parties, consult solicitors, counsel or advocates upon any technical question of law, evidence, practice or procedure arising in the course of the reference. If the parties agree, the arbitral tribunal may, at the expense of the Parties, appoint any expert, accountant, or lawyers to sit with as an assessor and take into account the advice of such assessor.

Rule 51

The Parties to the reference and any witness on their behalf shall, subject to the provisions of any law for the time being in force :

(a) submit to be examined by the arbitral tribunal on oath or affirmation in relation to the matters in dispute.
(b) produce before the arbitral tribunal all books, deeds, papers, accounts, writings and documents in their possession or power respectively which may be required or called for by the arbitral tribunal.
(c) Comply with the requirements of the arbitral tribunal as to the production or selection of samples, and
(d) generally do all other things which, during the pendency of the reference, the arbitral tribunal may require.

Rule 52

The arbitral tribunal will consider, as far as possible, to receive the evidence of witnesses by affidavit. Provided that the witness whose affidavit is admitted in evidence is made available for cross-examination at the request of the opposite Party, the Arbitral Tribunal may:
(a) administer oath or affirmation to the Parties or witnesses appearing and giving evidence;
(b) make any award conditional or in the alternative;
(c) correct in any award any clerical mistake or error arising from or incidental to any slip or omission;
(d) administer to the Parties to the arbitration such interrogatories as it may consider necessary;
(e) decide all objections to its jurisdiction including any objection regarding the existence or validity of the arbitration clause or the arbitration agreement, without prejudice to the right of the parties to have the matter decided by the Court of law;
(f) decide the law governing :
(i) the contract or the matter in dispute,
(ii) the arbitration agreement, and
(iii) the arbitration procedure
(g) award interest including pendente lite interest.

Rule 53

When substantially the same dispute or questions of law and facts are likely to arise in more than one contract or agreement (Chain Contracts), the arbitral tribunal may invite all parties involved to agree to submit to an award in one arbitration between such two or more of the parties as are named for the purpose.

Rule 54

(i) The arbitral tribunal may by the award dismiss the application or claim:
(a) if the Claimant does not prosecute the arbitration proceedings or file the papers within the time granted; or
(b) neglects or refuses to pay the dues or deposits ordered to be paid by the arbitral tribunal or the Registrar.
(ii) The arbitral tribunal may make an ex parte award :
(a) if the Respondent neglects or refuses to appear or make his defence or fails to file the papers within the time granted; or
(b) neglects or refuses to pay the dues or deposits ordered to be paid by the arbitral tribunal or the Registrar.

Rule 55

The Registrar shall make necessary arrangements for a stenographic record of evidence whenever such record is required by a Party. The cost of the stenographic record and all transcripts thereof, if any, shall form part of the costs of the reference.

Rule 56

The language of the arbitration proceedings shall be English unless otherwise agreed by the parties. If any documents filed by a Party are in a language other than English, the Party filling such documents shall simultaneously furnish an English translation of the documents. The Registrar may make arrangements for the service of an interpreter at the request of one or more of the parties and costs thereof shall form part of the costs of the reference.

Rule 57

The arbitral tribunal may issue such orders or directions as it may deem necessary for safeguarding, interim custody, preservation, protection, storage, sale or disposal of the whole or part of the subject matter of the dispute or for its inspection or sampling without prejudice to the rights of the Parties or the final determination of the dispute.

WAIVER OF RULES

Rule 58

Any party who proceeds with the arbitration with the knowledge that any provision or requirement of these rules has not been complied with and who fails to state his objection thereto in writing, shall be deemed to have waived his right to object.

RETURN OF DOCUMENTS

Rule 59

Unless required to be filed in a Court of law, the arbitral tribunal shall have full discretion to retain/to return all books, documents or papers produced before it and may direct at any time that the books, documents or papers produced before it or any of them may be returned to the parties producing them on such terms and conditions as the arbitral tribunal may impose.

AWARD

Rule 60

No award shall be made by the arbitral tribunal unless the case of the party applying for arbitration has been brought to the notice of the other party and until after the lapse of such specified time within which he has been asked to submit his defence statement under Rule 18.

Rule 61

Whenever there is more than one arbitrator, the award of the majority shall prevail and be taken as the decision of arbitral tribunal. Failing a majority, the Presiding Arbitrator of the arbitral tribunal alone shall make the award.

Rule 62

Should the Parties arrive at a settlement of the dispute by common agreement before the Arbitral Tribunal and the Arbitral Tribunal is satisfied that such agreement is genuine and not to defeat the purpose of any law, the arbitral tribunal shall render an award as per agreement of the Parties. Otherwise, the arbitral tribunal shall make the award on the basis of the documents, evidence, etc. filed before it by the Parties.

Rule 63

The arbitral tribunal shall make the award as expeditiously as possible, preferably within six months, according to the Guidelines, from the date of the reference subject to a maximum limit of two years from the date of commencement of the arbitral proceedings. If necessary, the maximum limit of two years for making the award may be extended by agreement between the parties to the dispute or by the Committee.

Rule 64


The arbitral award shall state the reasons upon which it is based, unless :

(i) the parties have agreed that no reasons are to be given, or
(ii) the award is an arbitral award on agreed terms.

Rule 65

The arbitral award shall state its date and the place of arbitration and the award shall be deemed to have been made at that place.

Rule 66

The arbitral tribunal may make an interim award, and may, by an award, determine and order what shall be done by either or any of the Parties, respecting the matters referred.

Rule 67

The arbitrators constituting the arbitral tribunal or the Presiding Arbitrator where Rule 61 is applicable, shall sign the award and the Registrar shall give notice in writing to the Parties of the making and signing thereof and of the amount of fees & charges payable in respect of the arbitration and the award. The arbitrators fee shall be payable by the Council on receipt of the award and requisite deposit made by the parties.

Rule 68

(a) When an award has been made, the Registrar shall furnish a true copy of the award to the parties by registered post provided the arbitration costs have been fully paid to the Council by the parties or by one of them.
(b) The Registrar may require either Party to notify him of the compliance with the award.
(c) The arbitral tribunal and the Registrar of the Council shall assist the parties in complying with any formalities that may be necessary for the enforcement of the award or for other purposes.
(d) The Council may print, publish or otherwise circulate any award made under its rules or under its auspices, in any arbitration journal, magazine, report, etc. for the purpose of creating arbitration jurisprudence or precedents for the benefit and guidance of future arbitrations. No party to the arbitration shall have any objection to the publication of awards as above provided that the names and addresses of any Party to the dispute will be omitted from such publication and its identity duly concerned if so desired by such party.

Rule 69

Additional copies of the award certified true by the Registrar shall be made available to the parties but to no one else, at all times at request and on payment as fixed by the Registrar.

Rule 70

A party shall in all things abide by and obey the award which shall be binding on the Parties and their respective representatives, notwithstanding the death of any party before or after the making of the award and such death shall not operate as revocation of the submission or reference. To avoid delays and further litigation, the arbitrators/Registrar shall ask the Parties to agree that the award made by the arbitrators/s shall be final and binding on the Parties and neither Party shall be entitled to challenge it in the Court of law.

FILING OF AWARD

Rule 71

The arbitral tribunal shall at the request of any of the Parties to the proceedings or of any person claiming under a Party or if so directed by the Court and upon payment of fees and charges due in respect of the arbitration and award and of the costs and charges of filing the award, cause the award or a signed copy thereof together with the deposition or documents which may have been taken and proved before it to be filed before the Court.

Rule 72

A fee of Rs. 1,000/- plus incidental expenses at actuals in addition to the court fees, on the scale for the time being in force is payable by the party requiring the award to be filed.

STAMP DUTIES

Rule 73

Stamp duties are to be paid by the parties in equal share in all cases in accordance with the scale of stamp duties for the time being imposed by law.

COPIES OF PROCEEDINGS

Rule 74

No party is entitled as of right to copies of proceedings before the arbitral tribunal. In case the Registrar is required to furnish copies of depositions and/or documents which have been taken or proved before the arbitrator, a charge as demanded by the Registrar shall be paid by the party requiring such copies.

Rule 75

The Registrar shall, upon the written request of a party, furnish to such party at his expense certified facsimile of any documents filed in the arbitration proceedings.

CASES WITHDRAWN

Rule 76

When the party instituting a case desires to withdraw it before an arbitral tribunal has been constituted, the Registrar shall return to him any deposits made by him, under Rule 28, after deducting such charges as he might have incurred in connection with the cases. The registration fee, however, shall not be refundable.

Rule 77

If the arbitration is terminated by the act or default of any parties after constitution of the arbitral tribunal and before the award is made, any fees, charges and expenses incurred by the Council shall be paid by the parties in such proportion as per schedule of fees prescribed in the Rules of Arbitration of the Council.

INDEMNITY OF SECRETARIAT AND ARBITRATORS

Rule 78

The Council, the Arbitration Committee and officers of the Council shall not be liable for any act or omission in whatever capacity they may have acted in connection with or in relation to an arbitration under these Rules. Parties are themselves required to contest the proceedings regarding the validity of the arbitration agreement before the court.

Rule 79

No party shall bring or prosecute any suit or proceedings whatsoever against the arbitral tribunal, or any member thereof, for or in respect of any matter or thing purporting to be done under these Rules nor any suit or proceedings in respect thereof (save for enforcement of the award) against the other party.

AMENDMENT OF RULES

Rule 80

The Governing Body may revise, amend or alter these rules or the schedule of fees and other monies to be charged and paid as and when expedient and necessary.

Annexure I


GUIDELINES FOR ARBITRATORS AND THE PARTIES FOR EXPEDITIOUS CONDUCT OF ARBITRATION PROCEEDINGS

1. The arbitrators and the parties to arbitration are expected to follow these guidelines to ensure economic and expeditious disposal of arbitration cases.

For Arbitrators

2. The arbitrators must take up the arbitration expeditiously on receipt of the request from the Council and should also complete the same with reasonable despatch. Serious efforts should be made to settle arbitration cases expeditiously within a period of 6 months where the amount of claim exceeds 1 crore and within a period of 4 months where the amount of claim is less than Rs.1 crore.

3. When accepting his mandate, the arbitrator shall be able to perform his task with the necessary competence according to his professional qualifications.

4. When giving notice of his acceptance, the arbitrator shall disclose in writing in the printed format as under:

- any relationship with the parties or their counsel which may affect his independence and impartiality;

- any personal or economic interest, either direct or indirect, in the subject matter of the dispute;

- any prejudice or reservation as to the subject matter of the dispute which may affect his impartiality.

- Where necessary due to supervening facts, this Statement shall be repeated in the course of the entire arbitral proceedings until the award is filed.

5. Where facts that should have been disclosed are subsequently discovered, the arbitrator may either withdraw or be challenged or the Indian Council of Arbitration may refuse to appoint him in other arbitral proceedings on this ground.

6. The arbitrator may at all stages suggest the possibility of a settlement to the parties but may not influence their decision by indicating that he has already reached a decision on the dispute.
7. In the course of the arbitral proceedings, the arbitrator shall refrain from all unilateral contact with the parties or their counsel which is not notified to the Indian Council of Arbitration so that the ICA can inform the other parties and arbitrators.

8. The arbitrator shall refrain from giving the parties, either directly or through their counsel, notice of decisions in the evidence taking place or on the merits; notice of these decisions may be given exclusively by the ICA.

9. The arbitrator shall neither request nor accept any direct arrangement on costs or fees with the party which has designated him. The arbitrator is entitled to reimbursement of expenses and a fee as exclusively determined by the ICA according to its Schedule of Fees, which is deemed to be approved by the arbitrator when accepting his mandate.

10. The arbitrator shall encourage a serene and positive development of the arbitral proceedings. In particular, he shall decide on the date and manner of the hearings in such a way as to allow both parties to fully participate therein, in compliance with the principle of equal treatment and adversarial proceedings.

11. The first hearing of the arbitral tribunal should be convened within 15 days of the receipt of the complete reply of the respondent when the arbitral tribunal may issue necessary directions. Admission and denial of the documents may be got done by the Registrar. Issues if any to be framed, may be done at the same or at the next hearing. The arbitrators should hold arbitration hearings continuously on day-to-day basis during office hours.

12. The parties should be asked to furnish a list of their witness, if any, in advance and they should be asked to file affidavits of witness on the date fixed for evidence preferably within a weeks of the settlement of issues, Cross examination of such of the deponent's witnesses whose presence is demanded by the opposite party should be completed at a hearing to be fixed within 15 days.

13. Arguments preferably should be heard within 15 days of the completion of evidence, to be followed by submission of written arguments, if any.

14. Adjournments of duly fixed hearing should not be granted except for unavoidable reasons which should be spelt out in the adjournment order.

15. The Arbitrator should make the award expeditiously after the close of the hearings, preferably within 15 days.

16. The arbitrator who does not comply with the provisions of these guidelines may be replaced by the Committee. Where it is not appropriate to replace the arbitrator in order not to cause delay in the arbitral proceedings, the ICA may also take such action after the conclusion of the arbitral proceedings, by refusing to confirm him in subsequent arbitral proceedings.

For Parties

17. The claimant should file the applications or demand for arbitration to the Registrar of the Council with all the information and papers as per Rules, full statement of claim and copies of documents relied upon, in 3 sets in case of a Sole Arbitrator and in 5 sets in case of three arbitrators

18. The respondent should file his reply to the claim with complete information and documents relied upon, in 3 or 5 sets as above as early as possible within the prescribed time. Fresh documentation/claims should not be entertained at a later stage of the proceedings unless the arbitral tribunal is satisfied about the reasons for granting such permission.

19. If any party to arbitration, particularly in cases where any arbitrator, advocate or any of the parties has to come from out station to participate in arbitration proceedings, desires to seek adjournment on any valid ground, it must submit a written request to the Registrar at least before 5 working days stating the grounds which compel it to request for postponement of the hearing so that the Council is in a position to take necessary steps to inform the Parties, Arbitrators and Advocates regarding postponement of the hearing. Parties seeking adjournment will have to pay cost as may be determined by the arbitral tribunal.

20. Parties should deposit arbitration and administrative fees with the Council (ICA) within the stipulated time, as per the Rules and no extension should be sought in this behalf except for compelling reasons.

21. To avoid excessive costs in arbitration proceedings, the parties are advised to choose their arbitrators from the Panel, as far as possible from the place where the arbitration hearings have to be held. In case, a party still chooses an arbitrator from a place other than the place of hearing, the concerned party will bear the entire extra cost to be incurred on stay TA/DA etc. of the arbitrator nominated by it.

For Arbitration Committee

22. The Arbitration Committee of the Council may examine the arbitration case file, from time to time to evaluate the progress of the proceedings and to ascertain whether the arbitrators have granted adjournments only on reasonable grounds.

23. The Arbitration Committee shall be sole judge of the grounds of violation of the guidelines and its decision shall be final and binding on the arbitral tribunal as well as the parties.