Chapter 3 : Composition of arbitral tribunal

Number of arbitrators—



1. The parties are free to determine the number of arbitrators, provided that such number shall not be an even number.

2. Failing the determination referred to in sub-section (1), the arbitral tribunal shall consist of a sole arbitrator.

Appointment of arbitrators—



1. A person of any nationality may be an arbitrator, unless otherwise agreed by the parties.

2. Subject to sub-section (6), the parties are free to agree on a procedure for appointing the arbitrator or arbitrators.

3. Failing any agreement referred to in sub-section (2), in an arbitration with three arbitrators, each party shall appoint one arbitrator, and the two appointed arbitrators shall appoint the third arbitrator who shall act as the presiding arbitrator.

4. If the appointment procedure in sub-section (3) applies and—
   
   

   1. a party fails to appoint an arbitrator within thirty days from the receipt of a request to do so from the other party; or

   2. the two appointed arbitrators fail to agree on the their arbitrator within thirty days from the date of their appointment,
      
      the appointment shall be made, upon request of a party, by the Chief Justice or any person or institution designated by him.

5. Failing any agreement referred to in sub-section (2), in an arbitration with a sole arbitrator, if the parties fail to agree on the arbitrator within thirty days from receipt of a request by one party from the other party to so agree the appointment shall be made, upon request of a party, by the Chief Justice or any person or institution designated by him.

6. Where, under an appointment procedure agreed upon by the parties,—
   
   

   1. a party fails to act as required under that procedure; or

   2. the parties, or the two appointed arbitrators, fail to reach an agreement expected of them under that procedure; or

   3. a person, including an institution, fails to perform any function entrusted to him or it under that procedure,
      
      a party may request the Chief Justice or any person or institution designated by him to take the necessary measure, unless the agreement on the appointment procedure provides other means for securing the appointment.

7. A decision on a matter entrusted by sub-section (4) or sub-section (5) or sub-section (6) to the Chief Justice or the person or institution designated by him is final.

8. The Chief Justice or the person or institution designated by him, in appointing an arbitrator, shall have due regard to—
   
   

   1. any qualifications required of the arbitrator by the agreement of the parties; and

   2. other considerations as are likely to secure the appointment of an independent and impartial arbitrator.

9. In the case of appointment of sole or third arbitrator in an international commercial arbitration, the Chief Justice of India or the person or institution designated by him may appoint an arbitrator of a nationality other than the nationalities of the parties where the parties belong to different nationalities.

10. The Chief Justice may make such scheme as he may deem appropriate for dealing with matters entrusted by sub-section (4) or sub-section (5) or sub-section (6) to him.

11. Where more than one request has been made under sub-section (4) or sub-section (5) or sub-section (6) to the Chief Justices of different High Courts or their designates, the Chief Justice or his designate to whom the request has been first made under the relevant sub-section shall alone be competent to decide on the request.
    
    

12. 1. Where the matters referred to in sub-sections (4), (5), (6), (7), (8) and (10) arise in an international commercial arbitration, the reference to “Chief Justice” in those sub-sections shall be construed as a reference to the “Chief Justice of India”.

    2. Where the matters referred to in sub-sections (4), (5), (6), (7), (8) and (10) arise in any other arbitration, the reference to “Chief Justice” in those sub-sections shall be construed as a reference to the Chief Justice of the High Court within whose local limits the principal Civil Court referred to in clause (e) of sub-section (1) of section 2 is situate and, where the High Court itself is the Court referred to in that clause, to the Chief Justice of that High Court.

Grounds for challenge—



1. When a person is approached in connection with his possible appointment as an arbitrator, he shall disclose in writing any circumstances likely to give rise to justifiable doubts as to his independence or impartiality.

2. An arbitrator, from the time of his appointment and throughout the arbitral proceedings, shall, without delay, disclose to the parties in writing any circumstances referred to in sub-section (1) unless they have already been informed of them by him.

3. An arbitrator may be challenged only if—
   
   

   1. circumstances exist that give rise to justifiable doubts as to his independence or impartiality, or

   2. he does not possess the qualifications agreed to by the parties.

4. A party may challenge an arbitrator appointed by him, or in whose appointment he has participated, only for reasons of which he becomes aware after the appointment has been made.

Challenge procedure—



1. Subject to sub-section (4), the parties are free to agree on a procedure for challenging an arbitrator.

2. Failing any agreement referred to in sub-section (1), a party who intends to challenge an arbitrator shall, within fifteen days after becoming aware of the constitution of the arbitral tribunal or after becoming aware of any circumstances referred to in sub-section (3) of section 12, send a written statement of the reasons for the challenge to the arbitral tribunal.

3. Unless the arbitrator challenged under sub-section (2) withdraws from his office or the other party agrees to the challenge, the arbitral tribunal shall decide on the challenge.

4. If a challenge under any procedure agreed upon by the parties or under the procedure under sub-section (2) is not successful, the arbitral tribunal shall continue the arbitral proceedings and make an arbitral award.

5. Where an arbitral award is made under sub-section (4), the party challenging the arbitrator may make an application for setting aside such an arbitral award in accordance with section 34.

6. Where an arbitral award is set aside on an application made under sub-section (5), the court may decide as to whether the arbitrator who is challenged is entitled to any fees.

Failure or impossibility to act—



1. The mandate of an arbitrator shall terminate if—
   
   

   1. he becomes de jure or de facto unable to perform his functions or for other reasons fails to act without undue delay; and

   2. he withdraws from his office or the parties agree to the termination of his mandate.

2. If a controversy remains concerning any of the grounds referred to in clause (a) of sub-section (1), a party may, unless otherwise agreed by the parties, apply to the court to decide on the termination of the mandate.

3. If, under this section or sub-section (3) of section 13, an arbitrator withdraws from his office or a party agrees to the termination of the mandate of an arbitrator, it shall not imply acceptance of the validity of any ground referred to in this section or sub-section (3) of section 12.

Termination of mandate and substitution of arbitrator—



1. In addition to the circumstances referred to in section 13 or section 14, the mandate of an arbitrator shall terminate—
   
   

   1. where he withdraws from office for any reason; or

   2. by or pursuant to agreement of the parties.

2. Where the mandate of an arbitrator terminates, a substitute arbitrator shall be appointed according to the rules that were applicable to the appointment of the arbitrator being replaced.

3. Unless otherwise agreed by the parties, where an arbitrator is replaced under sub-section (2), any hearings previously held may be repeated at the discretion of the arbitral tribunal.

4. Unless otherwise agreed by the parties, an order or ruling of the arbitral tribunal made prior to the replacement of an arbitrator under this section shall not be invalid solely because there has been a change in the composition of the arbitral tribunal.