Arbitration Act choice of law and forum for post-award challenge governed by party consent under the 1996 regime

Where parties consented to conduct arbitral proceedings under the Arbitration and Conciliation Act, 1996, that regime governed both the proceedings and any post-award challenge, and the earlier Arbitration Act, 1940 did not revive for challenging the award. The Court held that, absent express retention of supervisory control, an application to modify or set aside the award had to be brought before the principal civil court of original jurisdiction under the 1996 Act. It declined to bypass that statutory forum through Article 142 and relegated the applicant to the statutory remedy, with delay in filing objections to be condoned if filed within the stipulated period.

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Issues: (i) whether the arbitral proceedings and the post-award challenge were governed by the Arbitration Act, 1940 or by the Arbitration and Conciliation Act, 1996; (ii) whether an application to modify or set aside the award was maintainable before the Supreme Court or only before the principal civil court of original jurisdiction under the 1996 Act.

Issue (i): whether the arbitral proceedings and the post-award challenge were governed by the Arbitration Act, 1940 or by the Arbitration and Conciliation Act, 1996.

Analysis: The parties had consented before the arbitrator that the proceedings would be conducted under the 1996 Act, and such consensual adoption of the later statutory regime was held to be permissible under section 85(2)(a) of the 1996 Act. The fact that the dispute had arisen earlier, or that the arbitrator had been appointed in proceedings where the 1940 Act had been in the background, did not displace the parties' agreed choice for the conduct of the arbitral process and the remedy after the award. The Court therefore rejected the attempt to revive the 1940 Act for the purpose of challenging the award.

Conclusion: The proceedings and the post-award challenge were governed by the Arbitration and Conciliation Act, 1996, not by the Arbitration Act, 1940.

Issue (ii): whether an application to modify or set aside the award was maintainable before the Supreme Court or only before the principal civil court of original jurisdiction under the 1996 Act.

Analysis: The earlier order appointing the arbitrator did not retain supervisory control over the arbitral process in the Supreme Court; it merely recorded the parties' agreement and appointed the arbitrator. On that factual footing, the principles relied upon from cases under the 1940 Act, where this Court had retained control over the arbitration, were held inapplicable. The statutory scheme of section 34 read with section 2(e) of the 1996 Act provides a specific forum for challenge to an award, namely the principal civil court of original jurisdiction. The Court also declined to invoke Article 142 to bypass that statutory remedy or to grant interim relief against the statutory consequence of a section 34 challenge.

Conclusion: The application was not maintainable before the Supreme Court and could be pursued only before the competent civil court under the 1996 Act.

Final Conclusion: The application was dismissed, and the applicant was relegated to the statutory remedy before the appropriate civil court, with delay in filing objections directed to be condoned if filed within the stipulated period.

Ratio Decidendi: Where parties consent to conduct arbitral proceedings under the 1996 Act, the statutory regime of that Act governs the post-award challenge, and the forum for such challenge is the principal civil court of original jurisdiction under section 34 read with section 2(e), unless the court has expressly retained supervisory control over the arbitration.

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