New Delhi: The Union law ministry has proposed to strengthen the process of institutional arbitration by making provisions for appellate arbitral tribunals, giving disputants the option to appeal arbitral awards without moving courts of law.

This provision would, however, only be available for arbitrations conducted under the aegis of arbitration institutions, as per the draft amendment to the Arbitration and Conciliation Act issued on Friday.

The Arbitration and Conciliation Act, passed originally in 1996, is the country’s key legislation governing arbitrations in the country, and has been amended thrice before this in 2015, 2019, and 2021.

In India, arbitrations can either be ad-hoc, where parties determine arbitrators and the rules of procedure, or institutional arbitrations, where the same tasks are done by a specialised institution.

Low caseload in institutional arbitration in the country has been a pain point in the ecosystem, according to various expert panels, even as India aims to become a global arbitration hub.

The option for disputants to appeal arbitral awards in either a court or an appellate tribunal would only be available to arbitrations conducted by institutions, and not ad-hoc dispute resolutions, the proposed amendments to the Arbitration and Conciliation Act show, indicating the government’s push to strengthen these institutions.

Mint reported on 29 September that the government was working to strengthen the India International Arbitration Centre (IIAC) by increasing the institution’s caseload. The IIAC is the country’s only arbitration institution directly funded by the central government.

Some legal experts welcomed the proposed amendments, saying they may lead to a declogging of the courts.

“Yes, it is expected to help reduce the burden on Indian courts by strengthening and streamlining the arbitration framework, by limiting court intervention (narrowing the grounds of challenge), giving finality to the arbitral award, encouraging institutional arbitration, clearer appointment procedure and reducing litigation on appointments, making the overall process time-bound,” said Gauhar Mirza, partner, Cyril Amarchand Mangaldas.

However, others are wary. “While the proposed amendment shall offer some benefits and advantages but in my opinion there are potential challenges that could arise. This amendment would increase complexity and arbitration cost to the parties. With this amendment, appellate arbitral tribunals would mean that adding a layer of appeal within the arbitration process, which will lead to more complexity and delay in adjudication. The parties pay for arbitration and later pay for appeal, leading it to opening the doors for delaying the adjudication and making it less cost-effective,” said Alay Razvi, managing partner, Accord Juris.

Other proposed changes to the law include the omission of Conciliation from the Act. The law will now be called the Arbitration Act, the law ministry proposed.

The proposed amendments also included the addition of emergency arbitrations for interim relief of disputants, as well beefing up the Arbitration Council of India (ACI), which is a body created in 2019 to regulate the mechanism, with additional powers. The ACI, however, has not been constituted till date.

“Emergency arbitration offers a mechanism for disputants to seek interim relief swiftly, bypassing the need for lengthy judicial intervention. This could accelerate dispute resolution in commercial matters, providing immediate relief in urgent cases. However, it’s worth noting that while emergency arbitration is a step in the right direction, its effective implementation and success in India may still be a distant goal, considering the current arbitration framework and lack of awareness among stakeholders,” Abhishek Taneja, an advocate who practises before the Delhi High Court, said.

The ACI was created via the 2019 amendment with overarching powers to determine the model rules and procedures of arbitration in the country. It was also given powers to regulate arbitrators.

Now, the proposed amendments provide more powers to the ACI. The new proposal suspends the powers of the central government under the Fourth schedule of the law to prescribe fees for arbitration. Instead, it provides fee-deciding powers to the ACI, in cases where the fees have not been decided by the parties or by the arbitration institution.

The ACI also has the powers under the proposed law to create model rules of procedure for arbitration proceedings, which have to be followed by the arbitrators in ad-hoc cases, or where parties have themselves not decided upon a set of rules.

“We should also understand that the ACI’s code needs to be followed as part of the amendment, but the body does not exist. This can lead to confusion and increase in disputes,” said Razvi of Juris Accord.

Crucially, the proposed amendment will also allow arbitrations conducted via video conferencing. It also allows parties to use digital signatures for arbitration proceedings.

Proposed amendment also tightens the definition of courts for arbitration

The proposed amendment also tightens the definition of “courts” for arbitration, clarifying that courts having territorial jurisdiction over the dispute will hear appeals from the arbitration process.

It also grants more powers to arbitration institutions to allow or disallow extension of the arbitration process — with the same power granted to relevant courts for ad-hoc arbitrations.

The proposed amendments also tie arbitration with the Mediation Act passed last year, by saying that if parties come to a consensus during the arbitration proceedings, it would be recorded as a mediated settlement agreement enforceable in accordance with the provisions of Mediation Act, 2023.

The law ministry has sought public feedback on these proposed amendments, and the same can be given within the next 15 days.

New Delhi: The health ministry has invited applications to fill posts at the country’s medical education regulators following a management crisis at the National Medical Commission (NMC). 

It has sought applications for the posts of president, secretary and members of NMC, and key positions in the four boards under the NMC—the Undergraduate Medical Education Board (UGMEB), Postgraduate Medical Education Board (PGMEB), Ethics and Medical Registration Board (EMRB) and Medical Assessment Rating Board (MARB).

The NMC that had replaced the Medical Council of India faces a management crisis, with the NMC administration raising the issue with the health ministry on several occasions seeking reforms as reported by Mint earlier.

Mint reported on 27 September that the NMC has sought government intervention to resolve an internal crisis with its four autonomous boards working at cross-purposes, two people aware of the development said. The commission had had to cancel several public notices following poor internal consultations, and had flagged the matter to the Union health ministry.

“While reviewing applications of the medical colleges to the health ministry in July and August, it came to our notice that many such applications have seen conflicting decisions within boards,” the first person said on the condition of anonymity.

Increasing mismanagemet

The disarray comes in the wake of an outcry over leaked question papers in the National Eligibility cum Entrance Test (NEET) that selects candidates for various undergraduate medical courses. NMC, which replaced the erstwhile Medical Council of India, administers NEET, taken by more than 2.3 million candidates this year.

According to a person aware of the matter, while UGMEB imposed penalties on one college, PGMEB allowed the same institution to increase the number of seats. In another case, MARB allowed a college to increase the number of PG seats, only for PGMEB to reduce them. Mint could not identify the institutions involved. The NMC has taken the matter to the health ministry several times, including as recently as August, the people cited above said.

Withdrawing official communications due to poor internal discussions has become frequent, the second official said. On 16 August, PGMEB issued a notice discontinuing all courses under the umbrella of the College of Physicians & Surgeons (CPS), Mumbai. However, it was withdrawn on 30 August after it was challenged in the Bombay High Court. Similarly, the UMEB on 31 August issued Competency-based Medical Education Curriculum (CBME) Guidelines, 2024, before withdrawing it on 5 September.

The NMC was created by a government notification on 24 September 2020, aiming to introduce objectivity, transparency and fairness in the processes, and to provide more operational flexibility and ensure prompt decision-making to improve the quality of medical education. The four boards were envisaged to achieve these objectives, functioning independently with well-defined powers and responsibilities.

A former NMC member said the individual boards are not empowered to issue notifications; only the NMC secretariat may do so. “In fact, between 2021 and 2022, I submitted in writing that the boards were going above the head of NMC, and they cannot take decisions without NMC’s order,” the former member said on the condition of anonymity.

Dr J.L. Meena, a former MARB member, said he had raised his concerns about the conduct of the boards to NMC in April. “I myself wrote to the NMC leadership regarding mismanaged boards within NMC. Boards are not doing roles as defined in NMC Act,” he said.

Queries sent to the Union health secretary, the health ministry spokesperson and the NMC secretary remained unanswered.

In December, former NMC secretary Vipul Aggarwal highlighted these issues in a letter to the health ministry, saying the separation of powers between boards was disregarded and the commission is reduced to a “mere rubber stamp”. Mint has seen a copy of the letter.

The letter said the boards were acting independently of each other and the NMC, leading to poor transparency, accountability and grievance redressal, potentially damaging the standards of medical education and harming the NMC’s image. The boards had misinterpreted their autonomy to mean independence, and were directly interacting with the ministry and outsiders, potentially leading to serious embarrassment, the letter stated. It suggested the NMC’s supervision should be with the NMC secretariat, headed by the secretary.

Aggarwal declined to comment on this matter. “I am not part of NMC now and it is hardly within my responsibility,” Aggarwal told Mint.

The NMC typically imposes meagre fines of a few lakhs of rupees and allows erring institutions to renew their licences without getting deficiencies rectified, alleged Dr. Neeraj Bedi, former medical superintendent of a private medical college in Bhopal, calling it illegal and unethical. At many medical institutions, deans and medical superintendents defer to management demands and the roles themselves are defunct, he said.

“NMC’s regulation on Maintenance of Standards of Medical Education Regulations, (MSMER), 2023, clause VIII, which deals with penalties, recommends denial of permission or renewal to medical college applications. This practice is bringing down the quality of medical education in the country. NMC has miserably failed to regulate as apex medical education statutory body to deliver,” Dr. Bedi said.

Dr R.V. Asokan, national president of the Indian Medical Association (IMA), recalled the autonomous tenure of the Medical Council of India. The council had nurtured medical education in India and produced world-class doctors in India for seven decades after independence, Asokan said, adding the NMC has been structurally defective and constrained in many ways.