On July 8, 2024, the Supreme Court of India expressed serious concerns regarding the increasing trend of lengthy and complex submissions in proceedings under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996. The Court observed that such practices are leading to protracted hearings and undermining the efficiency of arbitration as an alternative dispute resolution mechanism.
Key Observations by the Supreme Court:
- Excessive Length of Pleadings: In a specific case, the arbitral award was 139 pages long, the Section 34 petition spanned 93 pages with 151 grounds, and the judgment of the Single Judge was 101 pages. Additionally, over 35 precedents were cited, many of which were repetitive.
- Inefficient Use of Court Time: The Court noted that such extensive submissions are causing significant delays in proceedings, with some Section 34 petitions in the Delhi High Court taking an average of over 3.5 years for disposal.
- Misapplication of Appeal Procedures: There is a tendency to treat Section 34 and 37 proceedings as general appeals under Section 96 of the Civil Procedure Code, leading to the inclusion of numerous grounds that are not legally permissible.
Court’s Recommendations:
- Adherence to Legally Permissible Grounds: The Court urged legal practitioners to limit their submissions to grounds that are legally valid under Sections 34 and 37, avoiding the inclusion of irrelevant or excessive arguments.
- Imposition of Time Limits: Recognizing the burden on courts due to lengthy hearings, the Court suggested the imposition of time limits for submissions to ensure expeditious disposal of cases.
- Legislative Intervention: The Court recommended that Parliament consider revisiting the provisions related to limitation periods in arbitration proceedings to balance procedural efficiency with fairness.
These observations aim to streamline arbitration proceedings, ensuring that they serve their intended purpose of providing a swift and effective resolution to disputes.
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