INDIA Law and Practice Contributed by: Amit Mishra and Mitakshara Goyal, Svarniti Law Offices
13. Miscellaneous 13.1 Class Action or Group Arbitration The ACA does not specifically provide for class actions or group arbitration. However, it is possible for multiple claimants to bring their claims together against the same respondent before a single arbitral tribunal, provided certain conditions are met. Each claimant must have a similar claim and must be party to an arbitration agreement with the respondent that is identical in all essential terms. If these requirements are fulfilled, Indian courts are likely to support a con - solidated arbitration, to avoid the inefficiency and risk of inconsistent outcomes that could arise from sepa - rate proceedings. This approach was affirmed by the Supreme Court in P.R. Shah, Shares and Stock Brokers Pvt. Ltd. v B.H.H. Securities Pvt. Ltd. (2011), in which it ruled a party’s claims against multiple parties under separate but similar arbitration agreements can be resolved in a single arbitration. The Court reasoned that refusing to allow consolidation would result in unnecessary duplication of proceedings and potentially conflicting decisions, which would be unjust. 13.2 Ethical Codes There is no specific ethical code dedicated to arbitra - tors in India; their duties are confined to those set out under the powers and duties of arbitrators as speci - fied in the ACA. 13.3 Third-Party Funding India currently has no statutory regime specifically regulating third-party funding in arbitration. The ACA does not address third-party funding, and the 2024 Amendment Bill does not introduce any provisions concerning it. In Tomorrow Sales Agency Pvt. Ltd. v SBS Holdings Inc. (2023), the Delhi High Court clarified the legal position to be the judgment acknowledged the impor - tant role of third-party funders in facilitating access to justice, but emphasised that funders are not liable under the award unless they are expressly party to the arbitration agreement or proceedings.
ichi Sankyo Company Ltd. v Malvinder Mohan Singh & Ors. (2018)). Indian courts apply the principle of restrictive sov - ereign immunity. This means that foreign states and their instrumentalities cannot claim immunity from enforcement of arbitral awards arising out of com - mercial transactions as opposed to sovereign acts. It is settled law that there is no sovereign immunity for foreign states in commercial matters ( Ethiopian Airlines v Ganesh Narain Saboo (2011, Supreme Court)). Fur - thermore, in the context of waivers of state immunity from jurisdiction, while there is no waiver of privileged immunity solely on the basis of an arbitration clause in the contract, the Supreme Court has consistently held that, at the stage of enforcement proceedings, states cannot claim immunity from such proceedings. 12.3 Approach of the Courts Indian courts have adopted a strongly pro-enforce - ment stance when it comes to foreign arbitral awards. The grounds for refusing enforcement on the basis of public policy have been deliberately narrowed, and are now limited only to violations of the fundamen- tal policy of Indian law or acts that are fundamentally against justice and morality. In Vijay Karia v Prysmian Cavi E Sistemi SRL (2020), the Supreme Court emphasised that courts should approach foreign awards with a presumption in favour of enforcement, intervening only in the rarest of cases. This minimal-interference policy is particularly evident in the context of public policy objections. For instance, in Avitel Post Studioz Limited v Hsbc Pi Holdings (Mauritius) Limited (2024), the Supreme Court rejected Avitel’s attempt to block the enforcement of a SIAC arbitral award by alleging bias. It held that “bias” under Section 48 must meet a very high threshold of violat - ing the “most basic notions of morality and justice” and that awards should be read supportively with an inclination to uphold rather than destroy. Importantly, the ACA expressly prohibits courts from reviewing the merits of the dispute when considering whether an award violates the fundamental policy of Indian law.
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