THE ARBITRATION AND CONCILIATION ACT – 1996

Arbitration is alternate dispute resolution mechanism, which aims at resolving commercial dispute between parties at an affordable cost and to save time. Main difference between a Court and an Arbitrator is that whereas the former is creation of the State the latter is appointed by private parties (Of course, if after agreeing to submit the commercial dispute to an Arbitrator, the parties fail to appoint an arbitrator, the arbitrator may be appointed by intervention of the Court). Arbitration in India is governed by the Arbitration and Conciliation Act, 1996

The Arbitration and Conciliation Act 1996 comprehensively covers both domestic and international commercial arbitration and conciliation and makes provision for an arbitral procedure which is fair, efficient, and is capable of meeting the needs of different kinds of arbitrations. It also ensures that the arbitral tribunal remains within the limits of its jurisdiction, minimizes the role of courts in the arbitral process and also permits an arbitral tribunal to use mediation, conciliation or other procedures during the arbitral proceedings to encourage settlement of disputes.

Arbitration and Conciliation Act was initially issued as an ordinance on 16/1/96 and became an Act ultimately in 1996 August. It has been made effective from 25th January, 1996.