Arbitration, as a preferred mode of alternative dispute resolution, hinges on the efficacy and enforceability of its outcomes. This article delves into two critical aspects of the arbitration process under the Indian Arbitration and Conciliation Act, 1996 (ACA): Interim Relief and Arbitration Awards, exploring their significance, legal framework, and practical implications.

The Indispensability of Interim Relief in Arbitration

Many disputes brought before arbitral tribunals involve tangible assets, goods, or proprietary rights. To ensure fairness and prevent unilateral advantage during the potentially lengthy arbitration proceedings, the mechanism of interim relief is paramount. Interim measures serve to maintain the status quo, preventing either party from prejudicing the other's rights concerning the subject matter of the dispute before a final resolution is reached.

Legal Basis

• Sections 9 and 17 of the ACA empower both courts and arbitral tribunals to grant interim measures.

Timing of Application

• Before the commencement of arbitration: If a court grants interim relief under Section 9, arbitration proceedings must commence within 90 days of the court's order.
• During the arbitration proceedings: Once the tribunal is constituted, applications are typically addressed by it under Section 17. Courts intervene only in exceptional circumstances.
• After the final award (but before its implementation): Courts may still grant interim relief. Arbitral tribunals lack this post-award authority.

Granting Interim Measures – A Matter of Discretion and Necessity

The decision to grant interim relief is discretionary. The applicant must show irreparable harm if relief is not granted and justify the necessity of the measure.

Types of Interim Measures

• Appointing a guardian for a minor or a person of unsound mind.
• Securing the amount in dispute.
• Restraining dealings with, or disposal of, any property or goods under the arbitration agreement.
• Custody or sale of goods which are the subject-matter of the arbitration.
• Securing attendance of witnesses and production of documents.
• Preservation, interim custody, or sale of goods which are subject-matter of arbitration.
• Granting injunctions or appointment of receivers.

Notification Requirement

The opposing party must be notified before interim relief is granted, ensuring fairness and procedural transparency.

Challenging Interim Relief Granted as an Interim Award

• An interim measure may be granted as an interim award, carrying the weight of a court order.
• Challenges can be made under Section 37 of the ACA. A second appeal is not permitted, but the Supreme Court may be approached in specific situations.
• Arbitration proceedings continue despite a pending challenge.

Recourse for Non-Compliance

• Non-compliance with interim measures may lead to enforcement proceedings and penalties under the Contempt of Courts Act, 1971.
• The aggrieved party can seek enforcement of the order in court.

Role of the Arbitral Tribunal in Enforcement

• Tribunals can issue interim orders but cannot directly enforce them.
• Only courts can enforce such orders.
• Tribunals may take non-compliance into account in future decisions or cost awards.

Court Intervention for Non-Compliance During Arbitration

• If a party disobeys an arbitral order, the aggrieved party can approach the court for enforcement.
• Courts may appoint receivers or impose penalties, including imprisonment under the Contempt of Courts Act, 1971.

The Final Award – Culmination of the Arbitral Process

The final award is the conclusive decision of the tribunal and should be clearly drafted for ease of implementation.

Legal Basis

• Section 31 of the ACA outlines the requirements of a final arbitral award.

Contents of a Final Award

• Resolution of all aspects of the dispute.
• Specific implementation instructions.
• Reasoned decisions.
• Date and place of arbitration.
• For financial claims: amounts, interest rates, and calculation dates.
• Signatures of all arbitrators, with reasons for dissent if any.

Settlement Awards

• Parties may settle during arbitration and request a settlement award under Section 30 of the ACA.
• It has the same enforceability as a final award and includes the signed settlement agreement.
• Tribunals are encouraged to promote settlements through mediation and conciliation.

Enforceability of Awards Despite Non-Participation

• Under Section 25, arbitration may proceed even if one party doesn't participate after receiving notice.
• The final award remains enforceable.
• Courts may set aside the award if non-participation is justifiably explained.

Post-Hearing Procedures

After hearings, the tribunal reviews all submissions and issues the final award based on its deliberations.

Addressing Omitted Claims or Counterclaims

• Section 33 allows a party to request an additional award if claims were omitted.
• The tribunal must respond within 60 days, extendable by another 60 days.
• The additional award becomes part of the final award.

Consideration of Trade Terms

• Amendments to Section 28 encourage tribunals to consider trade usage alongside contract language.
• In practice, tribunals prioritize clear contractual wording, emphasizing the need for unambiguous drafting.

Conclusion:
Interim relief and final awards are fundamental pillars of the arbitration process under the ACA. Interim measures safeguard the interests of the parties during the pendency of the arbitration, ensuring that the final outcome is not rendered futile by actions taken by either party. The final award, on the other hand, represents the culmination of the arbitral proceedings, providing a binding and enforceable resolution to the dispute.

A well-reasoned and clearly articulated final award, along with an effective mechanism for granting and enforcing interim relief, are crucial for upholding the integrity and efficacy of arbitration as a robust and reliable method of dispute resolution.