Report No. 176
2.19.2. It is, therefore, proposed to substitute sub-section (1), and (1A) for the existing sub section (1) of section 28 as follows. Section 28:
"The rules applicable to the substance of dispute "(1) In an arbitration other than an international arbitration (whether commercial or not), the arbitral tribunal shall decide the dispute submitted to arbitration in accordance with the substantive law for the time being in force in India;
(1A) In an international arbitration (whether commercial or not), where the place of arbitration is situate in India,
(i) the arbitral tribunal shall decide the dispute in accordance with the rules of law designated by the parties as applicable to the substance of the dispute;
(ii) any designation by the parties of the law or legal system of a given country shall be construed, unless otherwise expressed, as directly referring to the substantive law of that country and not to its conflict of laws rules;
(iii) failing any designation of the law under clause (i) by the parties, the arbitral tribunal shall apply the rules of law it considers to be appropriate given all the circumstances surrounding the dispute."
We are proposing that the amended section be, to some extent, retrospective as stated in section 32 of the Amending Act, where an arbitral tribunal has not been appointed in pending proceedings. 2.20.1 Minority view to be appended to award: Section 29: (1) Sub-section of section 29 refers to the 'decision' of the arbitral tribunal, where it has more than one arbitrator. The decision is to be by a majority.
As pointed out in the Consultation Paper (Annexure -II), the law is that a decision of the minority is not to be treated as part of the award. But it was suggested that the minority view may be appended to the award passed by the majority. This would enable parties or a court of law to know the reasons for the dissent. There was consensus that such a provision can be added. In order that the minority member may not unduly delay his opinion, a time limit of 30 days is proposed to be provided in section 29.
In a situation where there are more than two members in an arbitral tribunal and all of them differ in their opinion from one another and it is not possible to spell out the majority opinion of the arbitral tribunal. Then, the opinion of the presiding arbitrator of the arbitral tribunal is to be treated as the award of the arbitral tribunal. Such a provision is contained in ICC rules and we propose to add such a provision in section 29.
2.20.2 Thus in section 29 of the Principal Act, after sub-section (2) the following sub-section shall be inserted :
"(3) The minority decision shall, if made available within thirty days of the receipt of the decision of the other members, be appended to the award."