Ease of doing business: PM Narendra Modi, CJI push for arbitration to settle rows

The government and the highest judiciary were at the same page to unburden courts of commercial disputes and hand these over to professionally trained arbitrators.

Written by Utkarsh Anand | New Delhi | Updated: October 24, 2016 6:20 am
Narendra Modi, cji, india business, judiciary, india judiciary, Chief Justice of India, T S Thakur, commercial disputes, business commercial disputes, india news, indian express Modi, CJI Thakur in New Delhi on Sunday. (Source: Express photo by Prem Nath Pandey)

Concerns over ease of doing business in India, Sunday brought the government and the judiciary together as Prime Minister Narendra Modi and Chief Justice of India T S Thakur appealed in unison to promote arbitration instead of regular court proceedings for resolving commercial disputes. Even as they struggle to find a meeting ground on the new mechanism to appoint judges, the government and the highest judiciary were at the same page to unburden courts of commercial disputes and hand these over to professionally trained arbitrators, who could decide in a time-bound and cost-effective manner.

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While Modi exhorted that “availability of quality arbitration mechanisms is an integral component of ease of doing business,” Justice Thakur cited the “ever increasing avalanche of cases” to push this alternative method of resolving commercial disputes.They were addressing a global conference on ‘National Initiative Towards Strengthening Arbitration and Enforcement in India’, organised by NITI Aayog. The three-day conference was attended by chief justices and judges of foreign courts, apart from various Supreme Court judges, including Justices Anil R Dave, J S Khehar, A K Sikri, S A Bobde and Uday U Lalit.

Seeking that India emerge as a global hub for arbitration, the PM pointed out that businesses seek assurances that commercial disputes would be resolved efficiently. Hence, a robust legal framework backed by a vibrant arbitration culture is essential, he said. This alternative dispute resolution should simultaneously facilitate arbitration, mediation and conciliation, Modi said. “This will provide additional comfort to investors and businesses. More importantly, it will also ease the case load on Indian courts. An enabling alternative dispute resolution ecosystem is a national priority for India. We need to promote India globally as an arbitration hub,” he said.

Calling independence of the judiciary a basic feature of the Indian Constitution, the PM added that common citizens as well as businesses repose immense faith in the integrity of the judicial process. CJI Thakur rued that 18,000 judges have to hear five crore cases every year. “Out of the 50 million cases, 20 million are disposed of every year but this ever increasing avalanche of cases filed in courts is putting the judicial system under stress. So we have to look at some alternative to the conventional method of dispute resolution systems,” said Justice Thakur.

He regretted that India ranked 130 among 189 countries on ease of doing business despite the push for ‘Make in India’ and increase in foreign reserves. “The need to strengthen the judicial system is intrinsically and deeply connected with our zeal to attract foreign direct investment,” asserted the CJI.

Emphasising the need to have credible institutions to offer arbitration, he said that not only former judges but also domain experts should be engaged. The CJI acknowledged that criticism of courts for regular interference in arbitration awards was “not misplaced”, underlining that former judges may also falter as arbitrators. “There is a need to sensitise courts for deference to arbitration awards. We need to not only train judges but re-look at the statutory provisions.”

Union Law Minister Ravi Shankar Prasad highlighted various initiatives undertaken by the NDA government to facilitate business in India and said that not only ‘Make in India’, it is also time for ‘Resolve in India’ through efficient arbitration mechanism. Speaking at the event, Attorney General Mukul Rohatgi tackled the criticism of the legal fraternity over fixing a time limit of one year for deciding disputes through arbitration. He cited a 2014 judgment of the apex court making it mandatory for trial courts to finish within a year proceedings involving politicians as accused.

“If criminal cases can be decided within one year, it is not too short a period for arbitration proceedings to wrap up. Arbitration cannot become replica of ordinary courts and they must be decided expeditiously,” said the AG.