Arbitration in India is governed by the law of arbitration in India which states that the for adopting the arbitration as a dispute resolution mechanism an agreement to that effect should be signed between the disputing parties. The parties can either opt for a separate arbitration agreement to be signed between them or include an arbitration clause in the main contract between the parties.
The Indian courts are increasingly adopting a pro-arbitration approach and enforcing valid arbitration agreements. The statement of objects and reasons of the Arbitration and Conciliation Act also recognizes the principle of non-intervention by courts in the arbitration process. However, the Indian courts will refuse to enforce an arbitration agreement where it finds prima facie that - no valid agreement exists or the dispute is not arbitrable.
The parties are free to decide on the number of arbitrators, as long as this is not an even number. Appointment of the arbitrator is the most important step in the arbitration process. If the parties fail to specify the number of arbitrators, the tribunal will consist of one arbitrator. When the parties fail to agree on a procedure for appointing a three-member tribunal, each party will nominate one arbitrator and the two party-appointed arbitrators will then appoint the presiding arbitrator. If a party fails to appoint an arbitrator within the stipulated period, the other party can apply to the Supreme Court or the High Court seeking the appointment of the arbitrator.