The Author, Ashi Kaim is a 3rd Year, BBA.LLB student at University School of Law and Legal Studies, GGSIPU. She is currently interning with LatestLaws.com.
INTRODUCTION
The government has taken a pro-active stance over the past couple of years to promote India as an arbitration centre. A Committee under the Chairmanship of Hon'ble Justice B. N. Srikrishna, former Judge of the Supreme Court of India ('High-Level Committee'), was formed to recommend changes to the institutional arbitration system in India. One of the suggestions of the Committee was to revamp the International Centre for Alternative Dispute Resolution ('ICADR'), to facilitate an alternate dispute resolution process. The President of India passed the New Delhi International Arbitration Centre Ordinance, 2019 ('the NDIAC Ordinance') with a view to facilitating institutional arbitration. The Cabinet authorised the New Delhi International Arbitration Centre Bill, 2019 ("the NDIAC Bill 2019") to override the NDIAC Ordinance after the new government came into power. The Act provides for the creation of the New Delhi International Arbitration Centre ("NDIAC"), an organisation to help handle domestic and international arbitration in the nation. The NDIAC is to be declared as an agency of national significance. The Act also provides for NDIAC to take over the ICADR infrastructure and other services.
Q.1 What will be the features of New Delhi International Arbitration Centre after its incorporation?
ANS. For the purposes of exercising the powers and discharging the duties under this Act, the Central Government has created a body to be called the New Delhi International Arbitration Centre. This corporate body would have perpetual succession and control with a common seal. It may acquire, maintain and dispose of land, both movable and immovable, according to the provisions of this Act. It may enter into a contract and by the name defined can sue or be sued.
Q.2 What will be the composition of New Delhi International Arbitration Centre?
ANS. The Centre consists, first of all of a person who has been a High Court Justice of the Supreme Court or an eminent person with particular expertise and experience in the conduct or administration of litigation, legislation or administration. Then, two prominent people, both domestic and international, with extensive expertise and experience in institutional arbitration. Third, one of the members of a recognized commerce and trade industry. Fourthly, the Secretary, the Department of Legal Affairs, or his agent. Then, one Financial Adviser nominated by the Department of Expenditure and lastly a Chief Executive Officer. All of these shall be appointed by the Central Government.
Q.3 Are there any Terms and conditions of the Chairperson and Members?
ANS. The Chairperson and the members shall hold office for a total of three years from the date of their appointment into office and shall be eligible for re-appointment. In the case of a Chairman, the legal limit for holding office is 70 years and in the case of a Member, 67 years. As may be prescribed in the act, the terms and conditions, compensation and expenses payable to the Chairperson and the Full-time Member shall apply. If a Member is appointed to fill a casual vacancy, he shall hold office for the remainder of the term of the Member in whose place he has been appointed. The Part-time Member shall be entitled to such travelling and other allowances as may be prescribed.
Q4. How will the acquisition and transfer of undertakings of the society be proceeded?
ANS. By the virtue of this Act, undertakings of the Society will stand transferred and vested in the Central Government. All properties and assets vested in the Central Government before under section 7 will be freed and discharged from any trust, mortgage, obligation, charge, and all other liabilities affecting them or any attachment, injunction, decree or order of any court restricting the use of such properties or assets. Where on the date mentioned, any litigation, appeal or other proceeding of any sort relating to any asset or property previously assigned to the central government pursuant to Section 7 is pending, it shall not be lifted, discontinued or in any manner, prejudicially influenced by the transfer of the undertaking.
Q.5 Is there any provision under this act for management of the undertakings?
ANS. General supervision, guidance, regulation and management of the affairs of the undertakings designated to the Central Government under section 7 can be assigned to the Centre through a Central Government Directorate. If no such direction has been given by the central government, it shall be delegated to the custodian appointed by the central government and shall have the right to exercise all such powers as the society is entitled to exercise in relation to its undertakings. The remuneration and organizational tenure of the custodian would be at the discretion of the central government.
Q.6 What will be the duties of persons in charge of management of undertakings to deliver all assets?
ANS. All those in possession of the administration of undertakings immediately prior to the vesting or assignment shall be obliged to provide all properties, account books, registers and other records in their custody relating to the undertakings to the Centre or to the Custodian. The Central Government may give such orders as it may deem desirable to the Custodian regarding the actual powers and duties of the Custodian. The Central Government or the Centre may take all appropriate measures to ensure the custody of all undertakings entrusted to the Central Government or the Centre pursuant to this Act, or may lead them to take such steps.
Q.7 What are the objectives to be fulfilled by this Centre?
ANS. The Centre's key objective is to develop itself as a flagship organization for international and national arbitration. Another is to encourage research, provide training and coordinate conferences and seminars on alternate dispute resolution. Next would be to provide resources administrative aid for conciliation, consultation and arbitral hearings.
Then, both at national and international levels, to maintain committees of accredited arbitrators, conciliators and mediators. One would be to work closely to ensure the Centre's credibility with other national and international agencies and organizations. Lastly, the Centre will define parameters for various types of alternate dispute resolution mechanisms.
Q.8 What will be the functions performed by the Centre under this act?
ANS. The Center will endeavor to promote the professional conduct of international and domestic arbitration and conciliation. It is intended to provide cost-effective and prompt arbitration and conciliation services at the national and international level. It will encourage research on alternative conflict resolution and related issues and advocate changes to the dispute settlement system. It will also work to provide education for those who handle litigation, conciliation and mediation on alternate conflict resolution and related matters. It will help in the promotion of alternative conflict settlement in collaboration with other national or regional communities, organizations and institutions.
Q.9 How can the chairperson and the members of this Centre resign?
ANS. The Chairperson, Full-time Member or Part-time Member can resign his office by giving a notice in writing, under his hand addressed to the Central Government. Provided that the Chairperson or the Full-time Member will continue to hold office until the expiry of three months from the date of receipt of such notice or until a person duly appointed as his successor enters upon his office, whichever is earlier. If he wants to relinquish his office sooner, if will be done after seeking permission from the Central government.
Q.10 Who can and on what grounds can remove the members of the Centre?
ANS. A member can be removed from his office by the Central Government on 6 premises. First, whether he's insolvent or is undischarged. Secondly, whether during his tenure in office, he was involved at any time (excluding a part-time member) in any wage jobs. Third, if he was guilty of an offense requiring moral perversity. Fourth, whether he has gained some financial or other interest that is likely to influence his duties as a Member unjustly. Fifth, whether he has compromised his power in such a manner that his continuance in office is injurious to the public interest and, significantly, whether he is physically or mentally unfit to serve as a member.
Q.11 Who all will be present at the meetings of the Centre?
ANS. The chairperson shall shall ordinarily lead the meetings of the Centre and in his absence, the member chosen by the other Members present among themselves. It is the duty of the Chairman to ensure the implementation of the decisions taken by the Centre. The Chairperson shall exercise other functions and undertake certain other obligations that are delegated to him in compliance with this Act. The Centre shall meet at least four times a year at its meetings and shall observe such proceedings, including quorum as may be provided for in the Regulations. Every question raised before any meeting of the Centre shall be determined by a majority of the votes of the members present and voting and in the event of equality of votes, the person presiding will have a casting vote. All queries shall be dealt with as swiftly as possible and shall be disposed of by the Centre within sixty days of the date of receiving the notice. Any expert, other than a member, may be invited by the Chairperson to join in the meetings of the Centre, but such an invitee shall not be allowed to vote at the meeting.
Q.12 Can the powers of the Centre be delegated?
ANS. For the purpose of discharging its powers, duties and obligations, the Centre must determine in writing, by general or special order, the powers and responsibilities vested on the Centre by this Act (with the exception of powers to make regulations), which could also be exercised by the Chief Executive Officer or by any officer of the Centre. It is also crucial to lay down the terms and limits of those powers and functions.
Q.13 Is there any requirement to maintain any funds by the Centre?
ANS. The Centre shall create a fund to which the credit will be received from- all the funds given by the Central Government, all payments and other charges collected before or during the proceedings, all the funds received by the Centre for the amenities provided by the Centre to the parties, all the funds received by the Centre in the form of gifts, loans, contributions, the amount of investment profits received. This fund shall be deposited or invested in such banks as the Centre can decide. These Funds must be used to finance the salary and other allowances of the Members and the costs of the Centre in exercising its powers and discharging its obligations under the provisions of this Act.
Q.14 How will the accounts be maintained and auditing done?
ANS. The Centre shall keep proper accounting and other related documents and should prepare, in cooperation with the Comptroller and Auditor-General of India, an annual statement of accounts. The Centre's finances will be audited by the Indian Comptroller and Auditor General. The Comptroller and Auditor-General of India and any official appointed by him in connection with the audit of the Centre's accounts shall be entitled to the same rights, privileges and powers as the CAGI in connection with the audit. The accounts of the Centre as approved by the CAGI or any official appointed by the Centre along with the audit report, shall be forwarded annually to the Central Government and then to each House of Parliament by the Central Government.
Q.15 What is the need to establish chamber of arbitration and arbitration academy?
ANS. The Centre is required to set up a chamber of arbitration to organize the arbitrators and also review petitions for admission to the committee of reputed arbitrators for the maintenance of a permanent panel of arbitrators. The Chamber of Arbitration will consist of competent, credible, national and international arbitration professionals and individuals with broad expertise in the field of alternative dispute settlement and conciliation. The Registrar of the Centre's Secretariat shall serve as the Member-Secretary of the Chamber of Arbitration. The Centre could set up an Arbitration Academy to prepare arbitrators to compete on an equal footing with reputed international arbitral bodies, especially in the field of international commercial arbitration. It will also be advantageous to execute research in the field of alternate conflict settlement and similar fields and to make recommendations for the achievement of the Act's objectives.
Q.16 What is the scope of powers of the Centre to make regulations?
ANS. With the prior approval of the Central Government, the Centre may by notification, make regulations compliant with the provisions of this Act and the rules laid down thereunder. Such regulations can in particular, and without regard to the general principle of the preceding power, provide for the time, place and the rules of procedure to be followed in relation to the transaction of the Committee's business at meetings. The Centre can make regulations regarding the appointment, credentials and the Chief Executive's terms and conditions of service. The requirements for the admission of reputed arbitrators to a panel is also under the scope of Centre.
