MAHARASHTRA NATIONAL LAW UNIVERSITY, MUMBAI

CONTRACTS I

ARBITRATION AGREEMENTS IN INDIA

Semester 2

SYNOPSIS

Submitted to: Prof. Anand Raut Submitted by- Hardik Nain

Prof. Anand Shrivas Enrolment No. – 2016 021

 INTRODUCTION:

A contract, in simple words, is a binding legal agreement that is enforceable in a

court of law. Every human relationship is built upon a contract. Communities and
nations coexist on the basis of a viable contract. Contract can be seen as an
inherent and underlying part of every human transaction. It is a binding
agreement to get something done. It is an exchange of promises for the breach of
which the law will provide a remedy which is found in the Indian Contract Act
18721. We all know how long it takes to settle a dispute arising due to breach of
one’s duty, so to avoid prolonged litigation in the era of industrial revolution of
increasing trade and commerce, the parties resort to a new method of solving
dispute known as arbitration which is being preferred at large because it saves
time as money which is required in litigation.

"Differences we shall always have but we must settle them all, whether
religious or other, by arbitration." - Mahatma Gandhi

Section 28 of Indian Contract Act 1872 talks about rendering void kinds of
agreements-

Every agreement, by which any party thereto is restricted absolutely from

enforcing his rights under or in respect of any contract, by the usual legal
proceedings in the ordinary tribunals, or which limits the time within which he
may thus enforce his rights, is void to the extent2

But certain exceptions are there such as –

1) Saving of contract to refer to arbitration dispute that may arise. This section
shall not render illegal contract, by which two or more persons agree that any
dispute which may arise between them in respect of any subject or class of
subject shall be referred to arbitration and that only and amount awarded in
such arbitration shall be recoverable in respect of the dispute so referred.
2) Saving of contract to refer question that have already arisen - Nor shall this
section render illegal any contract in writing, by which two or more persons
agree to refer to arbitration any question between them which has already

1
http://www.lawteacher.net/free-law-essays/contract-law/section-28-of-the-indian-contract.php
2
https://indiankanoon.org/doc/1224074/
 arisen, or affect any provision of any law in force for the time being as to
reference to arbitration.3

Arbitration and Conciliation act was enacted in 1996 so as to simply the

arbitration process. The notable features of the act will be discussed in later
submissions of the report. For eg, kinds of arbitration, how it has simplified the
process etc.

METHODOLOGY:

The research was done mainly to analyse how arbitration agreements have
changed he view of contracts. For this the primary source of means that the
researcher used was the Indian Contract Act 1872, The Indian Arbitration &
Conciliation Act, 1996 and various books or commentaries on the same. The
articles in the web also came to good use as they helped in establishing a clear
view of arbitration agreements in India.

BIBLIOGRAPHY:

 Legal Alternatives: Arbitration in India, INDIA BRIEFING NEWS (2016),

http://www.india-briefing.com/news/arbitration-in-india-12808.html/ (last visited
Jan 24, 2017).
This helped the researcher to study in depth about arbitration process.for eg. On
which this applies etc. And some basic things about arbitration.
 Laxmikumaran & sridharan, THE ARBITRATION LAW OF INDIA: A
CRITICAL ANALYSIS , THE ARBITRATION LAW OF INDIA: A CRITICAL
ANALYSIS (2014).
This helped the researcher to know pre act position and position after the act
came into existence, its salient features , scheme etc.
 Binsy Susan and Ankita Singh et al., DECIDING THE QUESTION OF

APPLICABILITY: ARBITRATION AMENDMENT ACT, 2015KLUWER ARBITRATION

(2016), http://kluwerarbitration.com/2016/09/15/deciding-the-question-of-
applicability-arbitration-amendment-act-2015/ (last visited Jan 24, 2017).

3
Id
This link provided the researcher to pounder over the applicability of Arbitration
and question arising out of it.
 Dhir & Dhir Associates, India: Evolution Of Arbitration In India, (2016).
 THE ARBITRATION AND CONCILIATION ACT, 1996,
http://www.wipo.int/edocs/lexdocs/laws/en/in/in063en.pdf (last visited Jan
24,2017)
This link provided the researcher to access The Arbitration and Conciliation Act,
1996
 White & Case LLP -Dipen Sabharwal, Aditya Singh and Sindhu
Sivakumar, ARBITRATION AGREEMENTS IN INDIALEXOLOGY,
http://www.lexology.com/library/detail.aspx?g=4cba2d32-8661-4ef9-ac82-
85a96fb7790b (last visited Jan 25, 2017).
This provided researcher more knowledge about the research about the validity
etc.