[Arbitration Act] S.2(1)(f) Is Non-Derogable, Applicability Cannot Be Excluded Even By Mutual Consent Of Parties: Delhi High Court
3 months, 2 weeks ago

[Arbitration Act] S.2(1)(f) Is Non-Derogable, Applicability Cannot Be Excluded Even By Mutual Consent Of Parties: Delhi High Court

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The Delhi High Court bench of Justice Neena Bansal Krishna has held that section 2 of the Arbitration Act which defined the International Commercial Arbitration is a non derogable provision and its applicability cannot be excluded even by mutual consent of the parties. However, certain Sections of the Act, like S.2 which is the definition section, form the basic structure of Law of Arbitration, and are non-derogable.” While noting the above observations of the Supreme Court, the court observed that while the Arbitration Act recognises the autonomy of the parties which can be used to derogate the provisions of the Act by mutual consent, there are some fundamental principles of the Act which cannot be derogated even by the mutual consent. The court further referred to the Supreme Court judgment in Amway India Enterprises Private Limited vs. Ravindranath Rao Sindhia and Anr., wherein the court has held that “an analysis of Section 2 would show that whatever be the transaction between the parties, if it happens to be entered into between two persons, at least one of whom is either a foreign national, or habitually resident in, any country other than India; or by the Government of a foreign country, the arbitration becomes an international commercial arbitration.” The court further analysed the distinction between foreign award and International Commercial Arbitration. “International Commercial Arbitration” is based on the nationality of the parties.” The court in the above also observed that “It affects the procedure of appointment of Arbitrator under Section 11 of the Act, the law governing the arbitration where the seat of arbitration is in India as provided for under Section 28 of the Act, and finally, the scope of challenge to which an award can be subjected to under Section 34 of the Act.

History of this topic

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