Arbitration and Conciliation Amendment Act, 2015, applies only to proceedings initiated after its enactment: Supreme Court

07 May 2024 8:19 AM

By: Admin

On 9 May 2023, the Supreme Court of India has clarified the applicability of the Arbitration and Conciliation (Amendment) Act, 2015, to proceedings initiated before its enactment. The court held that the Amendment Act is prospective in nature and will apply to those arbitral proceedings that are commenced, as understood by section 21 of the principal Act, on or after the Amendment Act, 2015, and to court proceedings which have commenced on or after the Amendment Act came into force.

The case concerned an application filed under Section 11(6) of the Arbitration and Conciliation Act, 1996, which dealt with the appointment of an arbitrator. The appellant argued that the Amendment Act, 2015, was applicable to the case, and that the High Court had committed an error by applying the provisions of the unamended Act.

The Supreme Court, however, rejected the appellant's arguments and held that the decision in the case of BCCI v. Kochi Cricket Pvt. Ltd., which held that the Amendment Act is prospective in nature insofar as the proceedings under sections 34 and 36 are concerned, does not apply to proceedings initiated under Section 11(6) of the Act.

The court also held that the decisions in the cases of Parmar Construction Company and Pradeep Vinod Construction Company, which held that the pre-amendment Act shall be applicable in cases where the notice invoking arbitration was issued prior to the Amendment Act, 2015, and the application under Section 11(6) was filed post amendment, were not per incuriam, as they were not in conflict with the decision in the case of BCCI.

Supreme Court clarified that the Amendment Act, 2015, is prospective in nature and shall only be applicable to arbitral proceedings that are commenced on or after its enactment, as understood by Section 21 of the principal Act. The court also held that the decisions in the cases of Parmar Construction Company and Pradeep Vinod Construction Company were not per incuriam and were in line with the decision in the case of BCCI.

D.D-9.May.2023

M/s. Shree Vishnu Constructions vs The Engineer in Chief Military Engineering Service & Ors.