The Interim Award Puzzle in The Indian Arbitration Regime : Future Course

Daksha Khanna

The full chapter may be found by clicking on the PDF link to the left.

The grant of Interim Awards is a lesser opted method but not a novel concept in Indian arbitration proceedings, with its use being traced back to the inception of the Arbitration & Conciliation Act, 1996 itself. This seemingly straightforward provision however, suffers from uncertainties which obstruct the pro-arbitration atmosphere currently prevailing in Indian courts. As the jurisprudence on the subject is limited, this article reviews the judicial treatment of the provision until now in the context of pragmatic realities like costs, possibility of use of the provision as a delay tactic, and the limited statutory prescription. In the light of the recent observations of the Supreme Court in the Bhadra Products case, which recommended to the Parliament to club the challenge of interim award with the final award under Section 34 to avoid ‘piecemeal challenges’ and reduce costs. It becomes necessary to evaluate the far-reaching consequences of taking away of such recourse from parties at the interim stage. In addition, the article also questions the considerable discretion of the tribunal and subsequently the courts, upon which the application of the provision relies. The article also touches upon the peripheral issue of the grant of interim award on admitted liability and whether it is permitted to contract out of Section 31(6) of the Act. Considering the deficiency of discussion on the aforesaid provision in the 246th Law Commission Report recommendations and Arbitration & Conciliation (Amendment) Act 2018, this article explores the need and extent to which the interim award provisions should be amended for a greater degree of certainty, uniformity and compliance with international standards.