The IITArb works towards accessing and popularizing of Arbitration across the country. It preaches speed and economical procedures for the solution of commercial disputes.
In past few decades, there has been a growth in infrastructure building, in different parts of the country. With the Growth of infrastructural development, there are always disputes related to construction contracts that cannot be avoided. India is potentially becoming the Hub of national and international arbitration. Therefore there is a need for the establishment of a standardized mechanism to address the dispute whenever they arise. Herein came IITArb. Established in the year 2003, The Indian Institution of Technical Arbitrators, (IITArb.) with Headquarters at Chennai, India, is an All-India, non-profit, professional body of Engineers and Architects, registered under Societies Registration Act, 1975.
The body works for popularizing Arbitration as a cost effective and speedy alternative method of resolution of commercial disputes. It imparts training to members and others in various aspects of Arbitration by conducting short-term courses, seminars, workshops, and in-house programs. It carries out research in Arbitration. The body has also built up a specialized reference library and have taken up Institutional Arbitration. The body also offers consultancy in Arbitration matters with special reference to preventive aspects. IITArb provides a single platform to Technical arbitrators, financiers, planners, developers, architects, and engineers of all disciplines as also builders, researchers, and manufacturers for forming a collective opinion on the subject related to Arbitration and projecting the same for consideration by appropriate authorities. Presently there are more than 1000 IITArb members, spread all over India, who have held or are holding senior positions in government, public sector and private sector undertakings. Recently FIVE Institutional members have been enrolled The members are bound by a strict ‘Code of Conduct’.
On the eve of Anniversary issue, keeping up with its theme of upliftment of institutional and engineering bodies in India, Masterbuilder had a one-to-one chat with P R Seshadri, President, IITArb.
During the conversation, he shared his insights on common queries related to IITArb objectives and future plans. Here the are few excerpts of the interview.
The nature of disputes varies with time. In regard to this what are the present issues in hand?
Answer- The types of contracts in earlier days were simple in financing and risk allocation and Construction arbitrations were confined mainly to technical disputes only. Primarily the contractors would claim in arbitration. The Employers, mostly public organisations, had their remedy in the contract itself. Hence counterclaims by Employers were rare and the arbitration clauses typically would not provide a procedure for the Employer seeking arbitration as a claimant.
In last few years more complex contract documents have been adopted with PPP and other modes of construction, including outside lenders as interested parties in the contracts. The risks undertaken are higher on the part of contractors including for reasons of some aggressive biddings. As a result, the proportion of legal disputes as claims in damages has increased manifold. The counterclaims by Employers are too common now. Even before arbitration commences, there have been issues of injunctions of bank guarantees. These involve high values and impact the projects.
The issues in hand are to address such disputes in time for early resolution and also to ensure enforcement, so that the liquidity or cash flow in a project is not affected. Stressed assets in construction sector pose a major issue today.
How does international and domestic arbitration updated constantly?
The Indian Institution of Technical Arbitrators held a two day international conference at Chennai in September 2016 on “Challenges on Domestic and International Arbitration”, which was attended by many Indian and foreign delegates. Expert arbitration professionals from India and abroad did deliberate on recent developments in the field. Similarly a national seminar on arbitration was held at Kolkata in December followed by one in May in New Delhi. In addition, regular lecture classes on arbitration matters are held in various State Chapters as well as in Head Quarters at Chennai to update on every development in the area.
What strategies is the body abiding by to reach out more?
In addition to regular lecture classes held for various organisations, a membership drive was undertaken. In last one year about 250 new individual members and five Institutional members have been enrolled into the Institution. Requisitions have been received from reputed organisations for professional service to be provided by our members. The Institution has also taken pro active role in making suggestions to the Central Government and high level committee formed by it regarding policy formulation and implementation in the field of arbitration. The Institution now envisages creating a transparent system for professional accreditation and empanelment of arbitrators to provide a credible platform for conducting Construction Arbitration in India.
Highlight on two remarkable judgments in the last year?
i. Enforcement of Foreign Awards in India – In a recent judgment in April 2017 the Delhi High Court enforced a high profile foreign award arising out of London Court of International Arbitration between a Japanese and an Indian entity involving 1.18 billion US dollar. The arbitration was due to dispute out of dissolution of a joint venture between Tata Sons Limited and NTT Docomo Inc in Tata Telservices Ltd. The crux of the issue was whether the enforcement of award would be against the public policy of India as apparently it was in violation of FEMA. The arbitral tribunal had rejected such a plea of Tata. The Reserve Bank of India had sought to intervene in the enforcement proceedings opposing the enforcement. The Court held that a non-party to the arbitration could not intervene in the enforcement procee-dings. The Court also concurred with the finding of the arbitral tribunal that the claim of Docomo was of damages and not of sale price of shares and hence not in violation of Indian law.
This judgment shows neutrality and pro-arbitral approach of Indian Courts, which is necessary for growth of arbitration in India. It also gives confidence to foreign investors in India.
ii. Permissibility of two tier arbitration in India – The validity of provisions of two tier arbitration in India was tested in M/S Centrotrade Minerals and Metals Inc. v. Hindustan Copper Ltd. (2017) 2 SCC 228. The first arbitration was in Indian Council of Arbitration , which gave a Nil award. Centotrade appealed before a second arbitrator Mr Jermy Cooke in London as per rules of ICC. This was as per the arbitration clause. The validity of such a second tier arbitration was in question. In 2006 the Supreme Court of India had given a split judgment on the issue. A three judge bench of Supreme Court in 2017 gave a unanimous decision on validity of second instance arbitration.
This decision is in tune with international arbitration practices and procedures. In this case the first arbitration was with seat in India, but the second arbitration was foreign seated with the curial law of England. Reliance was placed by Supreme Court on Mustill & Boyd, The Law & Practice of Commercial Arbitration in England. This shows pro-arbitration approach of Indian Courts and upholding party autonomy.
Details on Eligibility criteria for Membership – [fees, terms and conditions]
As Per Clause 8.4 of Bye Laws as Amended in 2015
1. For the position of President:
i) Fellow Member with minimum of 5 years standing in the roll of the Institution.
ii) He should have held any one of the offices of Senior Vice President or Hon. Secretary General or Chairman of State Centre / Local centre or Council Member.
2. For the position of Senior vice Presidents:
i) Fellow Member with minimum of 5 years standing in the roll of the Institution.
ii) He should have held any one of the offices of Hon. Secretary General or Chairman of State Centre / Local centre or Council Member.
3. For the position of Secretary General:
i) Fellow Member with minimum of 5 years standing in the roll of the Institution
ii) He should have held any one of the offices of Hon. Jt. Secretary General or Ho. Treasurer or Chairman of State Centre / Local centre or Council Member
4. For the position of Hon.Jt.Secretary General & Hon.Treasurer
i) Fellow / Member with minimum of 3 years standing in the roll of the Institution
5. For the position of Council Members:
i) Fellow/Member with minimum of 3 years standing in the roll of the Institution
Delhi State Centre
Two-Days Programme on “Dispute Resolution in Construction Contracts and New Callenges Ahead” jointly organized by Institute for Training of Building Professionals (ITBP) and IITArb, Delhi State Centre held on 17-18 March 2016. There was good participation and many benefitted out of Training. Er. O P Goel, Imm.Past President, IITArb spoke on the occasion.
Revised Membership Fee from 1 April 2017
Eligibility: Degree in Engineering / Architecture
Life Fellow (Minimum 20 Yrs Experience) ` 6000 + 500
Life Member (Minimum 10 Yrs Experience ` 4500 + 500
Life Associate (Minimum 5 Yrs Experience ` 3000 + 500
State Centres at Delhi, Mumbai, Kolkata, Chennai, Bangalore, Hyderabad, Cochin and local centres at Trivendrum & Madurai.
Indian Institution of
New Door No.4, Old Door No 36
Loganathan Colony, Mylapore,
Chennai – 600 004.