INDIA Law and Practice Contributed by: Amit Mishra and Mitakshara Goyal, Svarniti Law Offices
in arbitration must uphold the confidentiality of the arbitral proceedings, including the arbitrators, arbi - tral institutions and the parties themselves. However, there is an exception: the arbitral award may be dis - closed if such disclosure is necessary for the purpose of implementing or enforcing the award. It is important to note that, while Section 42A of the ACA imposes a duty of confidentiality, the Act does not specify any penalties or sanctions for breaches of this obligation. Therefore, although confidentiality is a legal requirement, the ACA does not provide for puni - tive measures in the event of non-compliance. Under Indian law, the definition of an arbitral award includes interim awards, which are recognised as such within the jurisdiction. Arbitral awards in India must adhere to several formal requirements provided under Section 31 of the ACA, including the following: • the award must be in writing and signed by all members of the arbitral tribunal, or by the majority, provided the reason for any missing signature is recorded; • it must include the reasons upon which it is based, unless the parties have agreed that no reasons are necessary, or if the award is based on a settlement under Section 30; and 10. The Award 10.1 Legal Requirements • the award must state both the date and place of arbitration, with the place being either as agreed by the parties or determined by the tribunal – the award is deemed to have been made at that place. All domestic arbitrations in India are to be concluded within 12 months from the date on which pleadings are completed. This period can be extended by anoth - er six months with the consent of the parties, but any further extension requires court approval. 10.2 Types of Remedies The ACA does not set out an exhaustive list of rem - edies that arbitral tribunals in India may grant. Nev - ertheless, arbitrators possess the authority to award various forms of relief, including:
• the payment of damages, interest and costs; • specific performance of contractual obligations; and • temporary and permanent injunctive relief. While some arbitration agreements include clauses restricting the tribunal’s power to award punitive damages, there is currently no judicial precedent that categorically prohibits tribunals from granting such relief. As a result, the issue of punitive damages in Indian arbitration remains unsettled. Indian law does not definitively state whether arbitrators can award punitive damages, and the legal framework regarding such damages is still at a nascent stage. 10.3 Recovering Interest and Legal Costs Arbitral tribunals in India have the authority to award both pre-award and post-award interest when the arbitral award involves the payment of money. For pre- award interest, parties are free to agree on its appli - cability and rate. If there is no agreement, the tribunal may grant interest at a rate it considers reasonable, for the period between when the cause of action arose and the date of the award. The tribunal may award interest on the principal sum as well as on any pre-award interest included in the award, and the Supreme Court in D. Khosla & Co. v Union of India has upheld the power to grant com - pound interest if the contract or statute allows it. The regime for costs was clarified and strengthened by the 2015 amendment, introducing Section 31A to the ACA. Under Section 31A, the tribunal or court has broad discretion to determine: • whether costs are payable by one party to another; and • the amount and timing of such costs. The general rule is that costs follow the event: the unsuccessful party is typically ordered to pay the costs of the successful party. However, the tribunal or court may depart from this rule for recorded reasons, such as partial success, frivolous claims or unreason - able refusal to settle.
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