Introduction: Evaluating India’s Emphasis on Party Autonomy
The evolution of arbitration reform in India has largely revolved around enhancing party autonomy. Initiated by the Arbitration and Conciliation Act, 1996 (“Arbitration Act”), subsequent amendments in 2015 and 2019, along with numerous judicial decisions, have underscored the importance of procedural flexibility and contractual freedom for efficient arbitration. Despite this, the appointment of arbitrators remains one of the most contentious issues under the Act, particularly under Section 11, where disputes often arise over unilateral appointment clauses, restricted panels, and issues of non-cooperation. These disputes can result in protracted legal battles over arbitrator appointments before addressing the core dispute itself.
Judicial decisions such as TRF Ltd. v. Energo Engineering Projects Ltd., Perkins Eastman Architects DPC v. HSCC (India) Ltd., and the significant ruling in Central Organisation for Railway Electrification v. ECI-SPIC-SMO-MCML (JV) have curtailed unilateral appointment powers and stressed the necessity of equality in tribunal formation. In light of these developments, the focus should transcend the binary of ad hoc versus institutional arbitration to ensure that arbitrator appointments are transparent, accountable, and impervious to strategic exploitation.
The Persistence of Ad Hoc Arbitration in India
Despite attempts at institutionalization through entities like the Mumbai Centre for International Arbitration (MCIA) and the Delhi International Arbitration Centre (DIAC), ad hoc arbitration remains prevalent in India. This is especially true in sectors like infrastructure, construction, and public procurement, where parties perceive ad hoc arbitration as more cost-effective and flexible. Unlike international hubs such as Singapore and London, where institutional arbitration is the norm for high-stakes commercial disputes, India’s arbitration landscape has primarily been shaped by party-driven processes with minimal oversight.
Recent adaptations, such as the 2026 ICC Arbitration Rules, aim to strike a balance between party autonomy and institutional control, introducing measures to prevent appointment deadlocks, manage conflicts of interest, and preserve tribunal neutrality.
The Paradox of Arbitrator Appointments
In India, disputes surrounding the formation of arbitral tribunals can often be more contentious than the dispute itself. Arbitration is intended as a more efficient alternative to litigation, yet significant judicial involvement is frequently necessitated at the arbitrator appointment stage.
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Structural Vulnerabilities in Party-Controlled Appointments
While disputes over appointments are often framed as issues of bias, the fundamental issue is the lack of robust safeguards in arbitrator appointments. Historically, contracts in government, infrastructure, and public procurement have allowed one party considerable leverage in tribunal constitution through unilateral appointments. Although courts initially upheld such clauses, recognizing the limits of party autonomy has revealed how unequal bargaining power can undermine fair appointment procedures.
Transition from Unilateral Appointments to Curated Panels
The Supreme Court’s rulings in TRF Ltd. and Perkins established that parties with vested interests should not unilaterally control the appointment process, as this could compromise the arbitral process’s neutrality. However, post-Perkins, the trend has shifted towards panel-based mechanisms, where one party proposes a list of arbitrators from which the opposing party must choose, raising concerns over panel capture and genuine equality.
Constitution Bench and Procedural Equality
The Constitution Bench’s decision in CORE emphasized that, while the Arbitration Act does not explicitly prohibit unilateral appointments, mechanisms heavily favoring one party may conflict with the Act’s foundational principles. Drawing from Sections 11, 12, and 18, the Court affirmed that procedural equality must encompass tribunal constitution, not merely the hearing stages.
The Fifth and Seventh Schedules of the Act bolster appointment safeguards by detailing circumstances that may compromise an arbitrator’s independence, and by disqualifying individuals in cases of direct conflicts unless expressly waived post-dispute.
Addressing the Appointment Crisis as a Governance Issue
The credibility of arbitration hinges on whether parties view the tribunal constitution process as fair and transparent. Persistent litigation under Section 11 concerning appointment delays and other procedural issues highlights the structural weaknesses within ad hoc arbitration. The Fifth and Seventh Schedules offer critical benchmarks, but their effectiveness in reducing Section 11 litigation is contingent upon enforcement, timely disclosures, and judicial awareness of power imbalances in contracts.
Is Institutional Arbitration the Solution?
In the past decade, institutionalization has been promoted as a remedy for delays and inefficiencies in arbitration. However, India’s challenges extend beyond the prevalence of ad hoc arbitration. Even after landmark decisions like Perkins and CORE, parties can still delay appointments and engage in procedural battles, necessitating judicial intervention to resolve deadlocks.
This context suggests that the focus should not solely be on the choice between ad hoc and institutional arbitration, but rather on developing governance mechanisms that ensure effective appointments regardless of the procedural framework. The future of Indian arbitration may lean towards hybrid governance models emphasizing transparency, neutrality, and accountability.
The central question is whether Indian arbitration can evolve beyond a notion of party autonomy equating freedom with minimal regulation. Future arbitration practices should focus on accountable autonomy, drawing lessons from institutional arbitration where procedural legitimacy is embedded within the appointment process. If India can integrate these lessons, the transition towards institutional arbitration will signify not just a procedural change, but a philosophical one.
About the Authors:
Ankit Konwar is a Partner Designate, Sonali Khanna is a Senior Associate-II, and Yashica Dhawan is an Assessment Intern at Hammurabi & Solomon Partners.
