ALTERNATIVE DISPUTE RESOLUTION:

PROJECT ON:

ONLINE DISPUTE RESOLUTION WITH ARBITRATION IN INDIA:

SUBMITTED BY: G. HARI KRISHNAN (16040141036)

[Link](HONS) SEC-A
ALLIANCE UNIVERSITY
BATCH: 2016-21

SUBMITTED TO: PROF: AISHA AHMED SHARFI

ALTERNATIVE DISPUTE RESOLUTION
ALLIANCE UNIVERSITY
 ONILNE DISPUTE RESOLUTION WITH ARBITRATION IN INDIA:

ABSTRACT:
The aim of this project is to focus on the overview of the Online dispute resolution with
arbitration in India. Arbitration is a procedure in which a dispute is submitted, by agreement
of the parties, to one or more arbitrators who make a binding decision on the dispute. In
choosing arbitration, the parties opt for a private dispute resolution procedure instead of going
to court. Arbitration is one of the possible procedural measures for the settlement of disputes.
It is a preferred means of alternative dispute resolution method. In the present juncture,
arbitration is a private system of adjudication, parties who arbitrate have decided to resolve
their disputes outside any judicial system. The aim of this project is to see the overview of the
Alternative and Online dispute resolution with arbitration in India. The aim of this project is
also to see some issues of legal situation such as Arbitration and conciliation Act,1996 and
also Arbitration and conciliation Amendment Act,2015 and 2019. This project also provides
suggestions for online dispute resolution in India.
KEYWORD-Arbitration, settlement of disputes, online dispute resolution.

1. INTRODUCTION:
The Arbitration process in India is something, which usually works as a dispute
resolution forum for the termination of business disputes. Arbitration is the private, judicial
determination of a dispute, by an independent third party. An arbitration hearing may involve the use
of an individual arbitrator or a tribunal. A tribunal may consist of any number of arbitrators though
some legal systems insist on an odd number for obvious reasons of wishing to avoid a tie. One and
three are the most common numbers of arbitrators. The disputing parties hand over their power to
decide the dispute to the arbitrator. Arbitration is an alternative to court action (litigation), and
generally, just as final and binding (unlike mediation, negotiation and conciliation which are non-
binding).

General principles of arbitration are as follows:

1. The object of arbitration is to obtain a fair resolution of disputes by an impartial third party
without unnecessary expense or delay.
2. Parties should be free to agree how their disputes are resolved, subject only to such
safeguards as are necessary in the public interest.
3. Courts should not interfere.
Arbitrators, or Tribunal members, are commonly appointed by one of three means:
1. Directly by the disputing parties (by mutual agreement, or by each party appointing one
arbitrator).
 2. By existing tribunal members (For example, each side appoints one arbitrator and then the
arbitrators appoint a third).
3. By an external party (For example, the court or an individual or institution nominated by the
parties).
Classifications Of Arbitration:
1. Commercial Arbitration is the most common of disputes. Just as it sounds, it is a dispute
between two commercial enterprises.
2. Consumer Arbitration surrounds disputes between a consumer and a supplier of goods or
services.
3. Labor Arbitration involves the settlement of employment related disputes. This form or
arbitration can be divided into two main categories: Rights Arbitration and Interest
Arbitration.
4. Rights Arbitration (Grievance Arbitration) deals with the allegation that an existing collective
agreement has been violated or misinterpreted. Various legislatures require that the parties
who enter into a collective agreement set out a procedure for the handling of disputes and
differences. The idea is that parties should be obliged to meet at different steps in their own
specific grievance procedure to review and discuss the grievance. However, the fact is that the
parties themselves cannot resolve many disputes and for this reason arbitration is necessary so
that the matter may be determined. Typical arbitration awards deal with a complaint that a
specific item in collective agreement has been violated.

5. Interest Arbitration (Contract Arbitration) is normally imposed by a statute and involves

adjudication on the terms and conditions of employment to be contained in a resulting
collective agreement. Since statutes, usually prohibit a legal strike, or lock out, these contract
disputes must be resolved somehow; in this case by interest arbitration. For example,
collective bargaining in a new collective agreement covering a fire force or a hospital may
break down into an irresolvable deadlock. The contractual matters still in dispute between the
parties would be put to an interest arbitrator or tribunal for a ruling and determination, which
would then form the relevant provisions of the collective agreement between the two parties.
The law on arbitration in India has three enactments namely, The Arbitration Act, 1940, The
Arbitration (Protocol and Convention) Act, 1935, and The Foreign Awards (Recognition and
Enforcement) Act, 1961. These laws have become outdated and the legislation introduced a Bill
seeking to consolidate and amend the law relating to domestic arbitration, international commercial
arbitration, and enforcement of foreign arbitral awards and to define the law relating to conciliation,
taking into account the UNCITRAL Model Law and Rules.

Online dispute resolution:

With the emergence of the Information Technology Act, 2000, e-commerce, and e-governance in
India, technology has given birth to an efficient and sensible mode of dealing with issues that further
aim at reducing the burden of already burdened courts and the government. Online Dispute Resolution
(ODR) is one such mechanism. It works on settling petty disputes online with the help of technology
and the adaptation of techniques associated with Alternative Dispute Resolution (ADR). In this
process, the online facilitator that is authenticated judicial person such as a lawyer or mediators is
given the responsibility of bringing the interests and claims of both the parties together with the help
of ADR methods such as mediation, arbitration, or negotiation. It is not only less forbidding but also
increases the probability to access justice.
1.1. EXISTING LEGAL SITUATION:
 Arbitration and Conciliation Act, 1996: The 'Arbitration and Conciliation Act 1996' is
an Act that regulates domestic arbitration in India.
Arbitration and Conciliation (Amendment) Bill, 2015: The Government of India decided
to amend the Arbitration and Conciliation Act, 1996 by introducing the Arbitration and Conciliation
(Amendment) Bill, 2015 in the Parliament. In attempt to make arbitration a preferred mode of
settlement of commercial disputes and making India a hub of international commercial arbitration, the
President of India on 23 October 2015 promulgated an Ordinance (Arbitration and Conciliation
(Amendment) Ordinance, 2015) amending the Arbitration and Conciliation Act, 1996. The Union
Cabinet chaired by the Prime Minister, had given its approval for amendments to the Arbitration and
Conciliation Bill, 2015.
Arbitration and Conciliation (Amendment) Bill, 2019: This amendment act seeks to
amend the Arbitration and Conciliation Act, 1996.  The Act contains provisions to deal with domestic
and international arbitration and defines the law for conducting conciliation proceedings. 

1.2. RESEARCH QUESTION:

1. Is Online Dispute Resolution The Future of Alternative Dispute Resolution?
2. How do arbitration proceedings fit within the COVID-19 times?
1.3. AIMS AND OBJECTIVES:
[Link] main aim and objectives are to study about the future challenges of arbitration in India.
[Link] analyse arbitration by the Arbitration and conciliation act.
3. To analyse digital arbitration and its key benefits in future.
4. To analyse the Impact of Arbitration and Conciliation Amendment Act,2019
1.5 RESEARCH PROBLEM:
The research problems are to be the various challenges of ODR with
arbitration in India. Although the Arbitration act is amended, can Arbitration and Conciliation
Amendment Act,2019 be considered as a final solution for Arbitration. Whether the digital arbitration
is useful and can digital arbitration is be challenge for people if the digital arbitration is established as
an alternative dispute resolution.
1.6 HYPOTHESIS:
The challenges of the arbitration is emerging and issues were raised and as solution the Arbitration
and Amendment bill, 2019 is enacted. The 2019 Act also gives an exemption to the international
arbitrations seated in India from the said timelines. Interim orders by Arbitral tribunals: As per
Section 17 of the Act, Arbitral tribunals could pass interim orders at any time from the date of
formation till the award is executed under Section 36 of the Act. The digital arbitration may be
difficult at first after establishing but after few years many people will proceed through digital
arbitration and it will not be stopped even if there is an another pandemic.
1.7 RESEARCH METHODOLOGY:
The methodology adopted for the purpose of conducting
research on this paper is purely Doctrinal research. This project data has been collected from various
secondary resource’s comprising of articles, books and journals and e-books and web sources,
judgements from cases and journals, which has been explained more detailed in the study.
1.8 LITERATURE REVIEW:
This paper comprises so numerous information
taken from multiple resources.
Future of arbitration: A world view with an Indian perspective and the need for a new normal
life([Link]
This article gives us a clear view on future of arbitration and it also explains about the digital
arbitration and also explains about the key benefits of digital arbitration. This article also explains
about the function of arbitration even during the pandemic period. And even in the future if an another
pandemic situation occurs and court does not function but even then the arbitration will function
through digital arbitration and these are all mentioned in the article.
Conflict of Interest and Challenges under Arbitration and Conciliation in India
([Link]
conciliation/ ):
This article explains about the emerging issues and the challenges of Arbitration in India. It also
explains about challenges in future of arbitration and also explains about whether Arbitration and
Conciliation Amendment Act,2019 can be considered as a solution for Arbitration. It also explains if
either of the party is dissatisfied with the decision and what will be the role of the court.
Online Arbitration- India's Step Towards Digitisation And Boon In Adversity
([Link]
[Link])
In this article the author explains about online dispute resolution during pandemic situation with case
laws and also explains whether online dispute resolution will be future of India.
2.1. DIGITAL ARBITRATION IN INDIA:
Online Dispute Resolution mechanism is a contemporary day ADR technique which uses internet to
determine disagreements flanked by two parties. No legislation defines ODR in any detailed
provisions it is only understood as a technique which channelize dispute settlement in cyberspace.
Online Dispute Resolution means that utilizing information technology to carry out alternative dispute
resolution. In its commencement it was only measured as a intermediate for solving virtually
originated disputes but now ODR is used in case of traditional offline disputes also.
REASONS WHY ODR IS NEEDED:
There stands no doubt as to the inevitability of ODR. The ODR mechanism promises to facilitate
ADR to become more competent, quicker, and less expensive. Specified the reasonably priced
technological communications profusely accessible, it is assured that ODR would be the chosen
means for dispute resolution even when both the parties’ inhabitant of the same city. This is so
because in most metropolitan cities, due to the traffic throughout peak hours, it takes an average of an
hour and a half to get into the heart of the city. Taking into consideration that it could take an identical
amount of time to get back, a party would be well off attending the said meeting via video-conference
so that he saves that extra 50% time that he would have spent in traffic. Besides, his occurrence may
not be compulsory for all the time in which case he can suitably log off. A party even saves on legal
costs as lawyers, and particularly counsels, charge by the hour and therefore they could be occupied
for a shorter duration if the proceedings are conducted online. And if the unbiased or the other party is
in a different city, this would save also the cost of transport and accommodations. The further benefit
of conducting proceedings online is that this affords the parties to appoint the services of experts in
any field who, due to their various other commitments, would not be accessible thanks to the time-
consuming efforts of attending an off-line summit.
Thus, it can be said that the ODR process is already an emerging method of dispute resolution in India
fixing perfectly within the Indian legal structure. It is a cheap, neutral, quick fix for small scale
disputes and is an obvious choice for the new technology friendly India. It wouldn’t be inaccurate to
say that ODR is the future of dispute resolution in India.
 2.2. ARBITRATION PROCEEDINGS DURING COVID:
India’s response in March 2020: The prime minister of India enacted a nationwide lockdown
to reduce the number of infected cases. It was essential, timely -- halting India’s government
completely except for urgent matters. India’s courts closed doors too, relying on video conferencing
for hearings. But within weeks the lockdown forced litigants to face unsustainable hardships. So, the
Supreme Court of India passed a blanket order dated March 23, 2020, specifying that the period of
limitation in arbitration in all proceedings before any court or any tribunal shall be extended from
March15, 2020 until further orders are passed. On May 6, 2020, the Supreme Court of India again
passed an order extending the period of limitation for statutory provisions under the Negotiable
Instruments Act and the Arbitration and Conciliation Act as well.
How do arbitration proceedings fit within the COVID-19 times?
Despite the increasing restrictions and complete lockdown in India, urgent arbitral proceedings may
still be conducted virtually through video conferencing. Such technology for virtual operations means
COVID-19 will not inhibit arbitration from proceeding as usual.
Section 19 of the Arbitration & Conciliation Act,1996 states that, “the arbitral tribunal shall not be
bound by the Code of Civil Procedure of 1908 or the Indian Evidence Act of 1872. The parties are
free to agree on the procedure to be followed by the arbitral tribunal in conducting its proceedings.”
Although the Arbitration & Conciliation Act of 1996 is silent on the conduct of arbitration
proceedings through video conferencing, Section 19 certainly allows the arbitral tribunal the same
technology. The arbitral tribunal can authorize all parties to the arbitration proceedings to file
pleadings through electronic mail and conduct proceedings via video conferences to satisfy social
distancing requirements without losing productivity. Even the Indian Council of Arbitration (ICA)
recommends that the arbitral tribunal may conduct arbitration proceedings by videoconference, by
telephone or any means of communication feasible. During International Commercial Arbitration,
virtual proceedings such as videoconferencing are already an established norm; therefore, domestic
arbitration proceedings should likewise adopt this method to ease arbitration during lockdown.

2.3. ADVANTAGES AND DISADVANTAGES OF ODR:

Advantages:
1. It helps to relieve court congestion.
2. It enhances community involvement in the dispute resolution mechanism.
3. Parties to ODR can themselves negotiate their settlement with the help of independent
mediatory. Thus, ODR sessions are flexible and non-afflicted with rigours of rules of
procedures.
4. It is the best alternative to exchange documents online through e-mediums. Since the venue of
proceedings is pre-decided, that is through video calls, it becomes relatively cheaper as the
documents need not be sent through posts and can be delivered online.
5. ODR enables the recording of oral or visual communications, statements, and pleadings
which solely are dependent upon digital records.
6. It eases the process of storing data.
7. Paves the more accessible way to acquire justice.
8. It is a non-confrontational apparatus where the litigant is not expected to appear in courts, and
the responsibility to resolve the dispute is adjudicated to ODR, which only gives insight to the
merits of the case.
 9. Cost plays a major role in a civil or criminal case. ODR  is an economically feasible process
that reduces the undue cost spent on the litigating procedures.
10. The process of ODR saves time as well as efforts. On one hand, where litigation proceedings
last for centuries, and ADR sessions carry on for a long and take months to pass an award, the
ODR mechanism takes only a few weeks to pass awards for the conflicting parties.
Disadvantages:
1. The process is not as easy as it seems. It can cause misunderstanding between the parties and
the adjudicating authority. It becomes difficult to judge the accountability of the witnesses
and parties. The process lacks face to face interaction; thus, it can hamper the credibility of
parties that reside in different countries and commute in different languages.
2. As the whole process takes over the internet, it lacks face to face interaction.
3. ODR is only suitable for a limited range of subjects such as e-commerce, domain name, etc,
and may not be suitable for grave disputes like trespass which requires discovery and claims,
defamation, and so on.
4. Adequate confidentiality cannot be ensured. Though data protection law is implemented it
becomes difficult for the authorities when hackers try to hamper the information.
5. It may give rise to jurisdictional issues. In the case of international law, four things are to be
kept for consideration:
 Details and merits of parties.
 The redressal to obtain the claim.
 Law to be applied for arbitration proceedings.
 Conflict of respective country’s rules applicable to each of the foregoing laws.

2.4. CHALLENGES UNDER ONLINE DISPUTE RESOLUTIION:

The primary confront is the convention of language in the ODR curriculum. At present the majority
accessible ODR services draw on only the English language, which can be a further difficulty in
expressing precise information and avoiding miscommunications. This can be a hurdle not just for
those parties who do not verbalize the language but also for those parties who make use of it as a
second or third language. But English language has extended to almost the entire globe. Removing
this language as a blockade for effective communication is a bona fide challenge. For instance, a
nation like India where there are more than 2000 languages spoken, it will be approximately
unfeasible to discover an ordinary ground language. The cultural differences diverge amid society to
society and individual to individual. Establishing a language as an intermediate of communication is a
charge for creator of ODR curriculum.
The succeeding blockade is the communication barriers which exist linking the neutral third party and
the parties to the dispute. ODR can offer convinced compensation compared with offline ADR. Let’s
take online mediation for example. Online mediation is by and large measured as a liberal idea, which
incorporates all from mechanized visually impaired submission systems and e-mediators to online
mediation stages with an individual facilitator and case supervision programs. In online mediation the
part of the middle person continues as prior to yet the fortitude of systems contrasts. ODR stages are
anticipated to give confidence transaction among their clients by empowering the revelation of
optimistic ordinary focuses that may bring about understandings. In this way, online mediation is any
divergence resolution arranges that is synchronized by a nonpartisan outsider, who does not strength
the variety of willpower but quite helps the parties in influential their question by conveying normally
through the web.
Another challenge is the make use of of language for communication with the parties by the neutral
third party. ODR with content based mediation, conciliation and arbitration makes it effortless for the
mediator to exchange a few words with the parties as the parties can take instance and assess what the
mediator/arbitrator/conciliator is striving to suggest which the offline mode frequently lacks. The
conference with experts is also facilitated by ODR for valuable communication.
Various practical ODR issues:
Confidentiality
Set of Rules vis-à-vis privacy in Mediation or other ODR processes ought to be agreed prior to the
course has started. This should cover both the contractual agreement to secrecy by the parties as well
as technological assurances about confidentiality in ICT system.
Enforcement
The enforceability of the online arbitration awards and ADR outcomes has been discussed seeing as
the premature days of ODR. Much rely upon the procedure itself as wheal as the nature of the
conclusion, whether arbitrated or settled, and how recorded. Under the New York Convention 1958
arbitration awards can be liberally imposed in any other contracting state, subject affair to certain
defenses, with the only enforcement challenge if there is any oddity in the transmission of the ODR.
Law and Jurisdiction
In anticipation of the ODR establishes its own set of laws and jurisdictions, the parties contracting
online should concur on legal system which is appropriate to their operation Nevertheless, it has been
originate that the parties to the dispute previously come to a decision and agree on these matters in
their contract which acts as a subject matter of the dispute.
3. CASE LAWS:
In Sundaram Finance Ltd. v. Abdul Samad and Anr,
the Hon'ble Supreme Court has clarified that execution proceedings can be invoked by an award
holder before any court in India where assets of the judgement debtor are located. Commercial courts
established under the Commercial Courts, Commercial Division and Commercial Appellate Division
of High Courts Act 2015 (Commercial Courts Act) would have jurisdiction in cases whether the
subject matter of the arbitration is of a specified value and pertains to monetary award. For other
cases, the jurisdiction of commercial division of a High Court would be applicable as per CPC.
Centrotrade Minerals and Metal Inc. Vs. Hindustan Copper Ltd.

In this case, a three-judge bench of the Supreme Court decided that it should be arbitration of two
rounds of the arbitration proceeding and it was permitted under Arbitration and Conciliation Act,
1996. The fact of the case is that an award was accomplished in an arbitration proceeding in India.
The award, which was delivered, was already given in the case of London. The London arbitration
award was tried to be implemented in India.

The Court held that the parties had the right to select that, will it be two-tier arbitration or not. The
Court held that there is no prohibition against the arbitration and Conciliation Act, 1996 and a
procedure can not violate the public policy of India. In the end, it came to know that the two-round
arbitration procedure is acceptable in the laws of India.

State of Maharashtra vs. Dr. Praful B. Desai

In this case, The Apex court acknowledged the use of video conferencing to record witness
statements. Even the Arbitration Act enumerates that subsequently in an ADR process, when the
award is declared; it can be exchanged via emails by sending scanned copies. This stance has
considerable legal backing and there are various cases in which the courts have upheld the validity of
dispute resolution using electronic communication.

Grid Corporation of Orissa Ltd vs. AES Corporation

In this case, The Supreme Court made a noteworthy observation that, “when an effective
consultation can be achieved by resort to electronic media and remote conferencing, it is not
necessary that the two persons are required to act in consultation with each other must necessarily it
together at one place, unless it’s a requirement of law or a contract between the parties” .Thus, it is
reasonable to conclude that the ODR process comes well within the ambit of the existing legal
framework in India.

3. CONCLUSION:
Online arbitration is not different from that of conventional arbitration
model. With changing times and technology, E-DRM is the future of arbitration, which is inevitable.
Sooner the companies adapt to this futuristic model of conducting arbitration, better and advantageous
it would be for such companies to provide speedy disposal and resolutions to its customers both in
terms of costs and time. E-arbitral awards in our opinion would have an equivalent effect as that of
traditional arbitral awards and would be final and binding upon parties.
Suggestions: Private ODR and ADR providers need to be added in the system to ensure that online
resolution can reach different industries, locations and parts of the country and also support the public
institutions. Making ODR or ADR voluntary will defeat the purpose so it should be made mandatory
(for specified categories) and it should cover about three sessions so that parties don’t feel that it’s a
mere formality. More recognition should be given to the online redressal processes so that its idea
reaches people and they can use these online processes.
Way Forward; There needs to be a fundamental change in the mindset to separate the idea of justice
from the place called, court. Multi-stakeholder exercises need to be undertaken to help achieve this in
a sustainable, efficient and collaborative manner for the transformation of justice delivery across
various facets. The future will be a hybrid model that combines the best of the real and the virtual
world. People need to reimagine the whole process of justice delivery to work in the hybrid system.
4. BIBLIOGRAPHY:
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