top of page
Search

REPLACEMENT OF “PLACE” WITH “SEAT” OR “VENUE” IN THE ACT SUGGESTED BY THE EXPERT COMMITTEE IN THE ARBITRATION ACT, 1996

The expert committee in its recommendation has recommended the replacement of “PLACE” WITH “SEAT” OR “VENUE” IN THE ACT to remove confusion between "seat", "venue," and “place” of arbitration.


The current sections 2(2), 20(1), 20(2), 20(3), 28, and 31(4) of the Arbitration and Conciliation Act refer to the "place" of arbitration. This term, alongside others like "seat" and "venue," has led to a lot of confusion leading to various judgments of the Supreme Court to interpret the above terms.


In the case of BBR (India) Private Limited v. Singla Constructions Private Limited, the Supreme Court clarified the difference between "seat" and "venue" in arbitration. It stated that once the 'seat' of arbitration is set under section 20(2) of the Act, it remains unchanged unless both parties agree to modify it. However, the 'venue' of arbitration can be changed from the original 'seat' to a new place. Jurisdiction is based on the 'seat' rather than the 'venue.'


The Committee endorsed the Supreme Court's interpretation in BALCO v. Kaiser Aluminium Technical Services Inc. and subsequent cases. According to this interpretation, in sections 20(1) and 20(2) of the Arbitration and Conciliation Act, the term "place" actually refers to the 'seat' of arbitration, while in section 20(3), it denotes the 'venue' of arbitration. Additionally, the Committee agreed with the recommendation from the 246th Law Commission Report to replace "place" with "seat" and/or "venue" as needed to maintain consistency and clarity in legal terminology.

 

The Committee is of the view that replacing "place" with "seat" in sections 20(1) and 20(2) of the Act grants parties the authority to select the "seat" of arbitration, thereby resolving jurisdictional concerns. This aligns, according to the Committee, with the international practice of establishing a judicial seat to determine jurisdictional matters, a concept increasingly significant in India-seated domestic arbitrations due to judgments by the Supreme Court over time.


Accordingly, the Committee recommended:

 

Amendment of section 20(3) by substituting the word “place” with the word “venue”;

 

Amendment of sections 2(2), 20(1), 20(2), 28(1) and 31(4) by substituting the word “place” with the word “seat”.


Recent Posts

See All

Comentarios

Obtuvo 0 de 5 estrellas.
Aún no hay calificaciones

Agrega una calificación
bottom of page