On Friday, The Madras High Court admitted a writ request challenging the Madras High Court Arbitration Rules, 2020 as ultra vires the Arbitration and Conciliation Act, 1996 and the Commercial Courts Act, 2015.
A Division Bench involving Chief Justice Sanjib Banerjee and Justice Senthilkumar Ramamoorthy has fixed the matter for hearing on July 2, 2021.
The appeal has been filed by one Sivesh Varshan on the following grounds:
Section 10 of the Commercial Courts Act shows the aim of the Parliament to establish Commercial Courts as a select court for commercial arbitration.
Towards this end, Section 15 accommodates the transfer of all procedures relating to the Arbitration and Conciliation Act to the said and it explicitly gives that all forthcoming cases are to be chosen as per the procedure prescribed under the Commercial Courts Act.
Nonetheless, all Principal District Courts in Tamil Nadu have been assigned as Commercial Courts. However, they treat petitions under Arbitration and Conciliation Act as some other appeal procedure.
Arbitration and Conciliation Act
Area 29(5) of the Arbitration and Conciliation Act can be conjured to get obedience of request of the Tribunal, by the way of contempt of Tribunal under the Contempt of Courts Act. In any case, the impugned Rules don't contain any procedure to be continued in such cases.
Rule 12(IV) of said Rules isn't reliable with section 2(e) of the Arbitration and Conciliation Act as the equivalent examines for the transfer arbitral procedures to Additional District Judge, who isn't Principal Court of Original Jurisdiction according to the meaning of District Judge as occurring in section 3(17) of the General Clauses Act.
Information technology act
Rule 6 of Order XI of the Commercial Courts Act identifies with electronic records of arbitral procedures. The provision owes its reality to the provisions of the Information Technology Act, 2000 which assigns the Union of India as the appropriate government for making suitable rules with the end goal of that act
There is no power for additional appointment of power of any appropriate government under the said Act. Henceforth, the High Court can't change those Rules by the way of subordinate authoritative authority under Section 82 of the Arbitration and Conciliation Act 1996, as there is no parliamentary endorsement for censured rules.
Section 82 of the Arbitration and Conciliation Act give that the High court may make rules reliable with the Act regarding the procedures before the courts