Procedural issues plaque India's arbitration regime: SC

New Delhi: The Supreme Court on Friday observed procedural issues have continued to plaque the arbitration regime in the country and asked the Centre for necessary changes in the existing law.

A bench of Justices J B Pardiwala and R Mahadevan said unfortunately, the Arbitration and Conciliation Bill, 2024, took no steps whatsoever for ameliorating the position of law over the power of impleadment or joinder of an arbitral tribunal.

The bench underlined the various amendments to the Arbitration and Conciliation Act, 1996 made over the years to ensure the arbitration proceedings were carried out and concluded expeditiously.

"It is indeed very sad to note that even after these many years, procedural issues such as the one involved in the case at hand, have continued to plaque the arbitration regime of India," the bench in a 191-page verdict said.

The Department of Legal Affairs has now, the bench pointed out, yet again proposed to replace the existing legislation on arbitration with the Arbitration and Conciliation Bill, 2024.

However, the court opined, "What is expressly missing in the Act, 1996 is still missing in the Arbitration and Conciliation Bill, 2024, despite a catena of decisions of this court as well as the various high courts, highlighting the need for statutory recognition of such power in order to obviate all possibilities of confusion."

The top court's verdict came on an appeal against the Delhi High Court's July 2024 order in an arbitration case.

The high court had affirmed the arbitral tribunal's order rejecting the challenge made by the appellant firm over its jurisdiction on the ground that the appellant being a non-signatory to the arbitration agreement could not have been impleaded in the case as a party to join the arbitration proceedings.