Arbitration is an alternate mechanism to resolve disputes and while it reduces the pendency of cases, arbitrators should be people with impeccable integrity, says Justice TS Thakur
By Ramesh Menon
IF the arbitration process has to work well in India, its legal format must undergo a change with professionalism coming in. India had potential to grow in this arena but lack of professionalism on the part of arbitrators and lawyers is bringing a bad name to the country, said Chief Justice of India TS Thakur.
He was speaking at an international conference: “Arbitration in the Era of Globalization” in Delhi, which was organized by the Indian Council of Arbitration (ICA) and FICCI.
“Go outside India to figure out why arbitration is not flourishing in India. An arbitrator in India will just sit for two hours for arbitration and is more interested in marking his presence. But in places like London, an arbitrator will sit for eight hours at a stretch as there is professional dedication. Singapore had become popular too because of the legal format it follows. Similarly, if a litigant is paying a lawyer, then the lawyer cannot seek an adjournment to suit his schedule. An arbitration bar should be there to bring in professionalism,” he said.
Justice Thakur said that due to the huge pendency of cases, the judiciary was supportive of the alternate dispute resolution mechanism of arbitration and wanted it to lessen its burden. “We will welcome a system like arbitration as it relieves us of the burden of pendency of cases and helps resolve disputes quickly. We welcome these measures as it consumes less time and money,” he said.
He stressed that the arbitration process must be pure without any extraneous consideration. “Our greatest concern is the integrity of the arbitrator when we are sitting in judgment of an award granted. One of the greatest challenges is to ensure that the arbitrator is of impeccable integrity. The judiciary also needs to be sensitized about how it needs to look at arbitration awards as binding,” he said.
“Honesty is not the monopoly of judges only and the judiciary does not say that the entire system barring judges is suspect… Arbitrators should have impeccable integrity so that there is no doubt in the minds of concerned parties about the award being decided. When comparison is being made between a judicial arbitrator and non-judicial arbitrator, we can say that the judicial arbitrator has been more reliable and credible,” Justice Thakur said.
In a lighter vein, he said that arbitration was also popular in Indian mythology. In the Mahabharata, when the Kauravas and the Pandavas were fighting, Lord Krishna became the arbitrator. He tried to settle the fight by mediating which shows us that mediation is a divine function. But he failed and so the lesson is that if we fail, we must remember that even Lord Krishna failed, he said.
The government has proposed amendments to the Arbitration and Conciliation Act, 1996, where an arbitrator will have to settle a case within 18 months. However, after the completion of 12 months, certain restrictions will be put in place to ensure that the arbitration case does not linger on. Justice Thakur said that it was heartening that the government was conscious of this requirement and was considering making amendments.
Justice Thakur said that critics of the judiciary were always pointing to the fact that there was a huge pendency of cases. As India grows and emerges as a huge economy, there are bound to be challenges and there will be a large spurt of litigations when new laws are made and challenged. This was a challenge before the judiciary, he said.
In a country with a population of over 1.25 billion, there are around 15,000 judges in the lower judiciary, 800 judges in the high courts and 30 judges in the Supreme Court, besides the Chief Justice. Over five crore cases are processed yearly in India. Out of them, two crores are disposed of despite the lack of infrastructure to do so, he stressed.
Former Supreme Court judge SS Nijjar in his keynote address said that the commercial and legal world had realized that arbitration has to be taken seriously. “India has the tag of how arbitration is for bravehearts and not for the weak. For arbitration to succeed, it must be speedy and the fee structure must be controlled apart from the fact that the arbitrator must be impartial,” he said.
Other topics discussed at the conference were bilateral investment treaty awards, the best arbitration practices, the changing face of arbitration in India and the global scenario.