COMPOSTION OF ARBITRAL TRIBUNAL – CHAPTER 3

The person who is appointed to determine differences and disputed is called the Arbitrator
or Arbitral Tribunal (which may consist of a sole arbitrator or panel of arbitrators), the
proceedings before whom are called arbitration proceedings, and his decision is called
award.

SECTION 10 OF THE ARIBTRATION AND CONCILLIATION ACT

1996 PROVIDES THAT-

1. The parties are free to determine the number of arbitrators, provided that such
number shall not be an even number.
2. If the parties fail to make the determination, the arbitral tribunal shall consist of a sole
arbitrator

Appointment of Arbitrators Section 11

A person of any nationality may be appointed as an arbitrator, unless otherwise agreed by
the parties. When the parties have agreed that the number of arbitrators to be appointed shall
be three, but do not agree on a procedure for their appointment, then each party shall
appoint one arbitrator, and the two appointed arbitrators shall be appoint the third arbitrator,
who shall act as the Presiding Arbitrator. Section 11 further provides that where a party fails
to appoint an arbitrator within 30 days from the date of the receipt of a request to do so from
the other party or where the two appointed arbitrators fail to agree on the third arbitrator
within 30 days from the appointment, then a party may request the Chief Justice of High
Court of the State concerned or any person or institution designated by the Chief Justice, to
take necessary measures. The decision on the matter entrusted to the Chief Justice or any
person or institution designated by the Chief Justice shall be final.

GROUNDS FOR CHALLENGE— SECTION 12

An arbitrator may be challenged only in two situations:-
1) if circumstances exists that give rise to justifiable grounds as to his independence or
impartiality;
2) if he does not posses the qualifications agreed to by the parties.

15 Procedure Section 13 The parties are free to agree on a procedure for challenging an arbitrator. If
there is no agreement on this point or the parties have failed to agree, then the procedure to be
followed is that the party wishing to present the challenge has to inform the Arbitral Tribunal of the
matter. This should be done within 15 days after becoming aware of the constitution of the Arbitral
Tribunal or after becoming aware of any circumstances of challenge, whichever is later. The
Tribunal shall decide on the challenge unless the arbitrator withdraws from his office or the other
party to the arbitration agrees to the challenge. If the challenge is not successful, the Tribunal shall
continue with the proceedings and shall make an award. But at that stage, the party who challenged
arbitrator may challenge the award and also make an application for setting aside the award in
accordance with section 34 of the Act.
16 Failure or Impossibility to act Section 14
‘Mandate ‘ means an authorization to act given to an arbitrator. Section 14 states that a mandate
given to an arbitrator shall terminate if…. He becomes de jure (by right) or de facto (in fact) unable
to perform his functions or for other reasons fail to act without undue delay; and He withdraws from
his office or the parties agree to the termination of his mandate. The mandate of an arbitrator shall
also be terminated in the following cases: Where he withdraws from office for any reason; or; By
virtue of an agreement between the parties In Construction India Ltd Vs. Secretary, Works
Department, Government of Orissa, it was held that demotion of a government employee from his
position does not lead to termination of that person as an arbitrator. S.14 provides the circumstances
of termination of arbitrator & demotion from a government position is not covered u/s 14
17 Substitution of Arbitrator {Section 15}
Where the mandate of an arbitrator terminates, a substitute arbitrator shall be appointed according
to the rules that were applicable to the appointment of the arbitrator being replaced Unless
otherwise agreed by the parties: Where an arbitrator is replaced, any hearings previously held may
be repeated at the discretion of the Arbitral Tribunal An order or Ruling of the Arbitral Tribunal
made prior to the replacement of an arbitrator shall not be invalid solely because there has been a
change in the composition of the Arbitral Tribunal