Aviation Disputes 2025 Comparisons

India’s legal system is rooted in common law, largely mirroring the English common law system. This includes laws governing contracts (such as the Indian Contract Act, 1872), penal provisions (Indian Penal Code, 1860 – now Bharatiya Nyaya Sanhita, 2023), civil procedure (Civil Procedure Code, 1908 (CPC)), and evidence (Indian Evidence Act, 1972 (“Evidence Act”) – now Bharatiya Sakshya Adhiniyam, 2023 (BSA)). Decisions of higher courts are binding on lower courts and persuasive in courts of equal or higher jurisdiction.

Court proceedings in India are adversarial – ie, parties present their cases before an impartial judge. The judge’s role is to oversee the proceedings and decide based on the merits of the arguments and evidence.

Indian law does not provide for pre-trial depositions. Instead, witnesses may be summoned to testify in court during the trial, where they undergo examination-in-chief, cross-examination, and re-examination (Order 18, CPC). While discovery, inspection, and interrogatories are allowed, formal pre-trial depositions are not a part of the Indian legal system. The CPC and BSA govern trial procedures and admission of evidence.

Civil cases generally do not require any pre-action conduct (except in commercial cases wherein, prior to filing a commercial suit, and in the absence of any request for urgent interim relief, the parties must attempt to resolve the dispute through mediation) and trials typically involve written submissions (such as plaint, written statement, rejoinder), witness examination and oral arguments. The court first frames issues, then parties submit evidence, followed by witness testimony and oral arguments. On the basis of the pleadings, evidence and oral arguments, a judgment is issued by the court.

India’s judicial system is structured into three main branches: criminal, civil, and specialised courts/tribunals. Court jurisdiction is determined by territorial, pecuniary, and subject matter factors. The court hierarchy includes:

• The Supreme Court of India is the apex court overseeing lower courts and, inter alia, handles the interpretation of provisions of the Constitution of India, 1950 (“Constitution”), enforcement of fundamental rights, and disputes between the Union and states.
• High courts have appellate and supervisory jurisdiction over lower courts, with some having original jurisdiction as well.
• District courts are subordinate to high courts.
• The Commercial Courts Act, 2015 (“Commercial Courts Act”) established commercial courts for expeditious resolution of commercial cases.
• Specialised tribunals are established for specific legal matters, such as tax, administrative issues, and company law disputes handled by the National Company Law Tribunal.

The appropriate forum depends on the subject matter, value, and nature of the dispute. For example, the subject matter of the dispute determines the forum: the Competition Commission of India addresses issues under the Competition Act, 2002, individual consumer complaints are dealt with by consumer forums under the Consumer Protection Act, 2019 (CPA), the Aircraft Accident Investigation Bureau addresses accidents in the aircraft as per the Aircraft (Investigation of Accidents and Incidents) Rules, 2017, and disputes involving compensation under the Bharatiya Vayuyan Adhiniyam, 2024 are dealt with per the existing agreement or by an arbitrator appointed by the central government.

In aviation-related disputes involving a government entity, parties often invoke high courts’ writ jurisdiction. Lessors have approached the National Company Law Tribunal and filed applications for initiation of insolvency proceedings against defaulting lessees under the Indian Insolvency and Bankruptcy Code 2016 or have approached high courts seeking issuance of writs directing the Directorate General of Civil Aviation to act upon their deregistration request in time.

Case Management

Indian judges actively manage cases, setting deadlines, framing issues, and directing evidence presentation, and play an interventionist role. Courts shall endeavour to pronounce the judgment within 30 days after conclusion of hearing, extendable up to 60 days in exceptional cases (Order 20, Rule 1, CPC). These timelines are often protracted due to reasons beyond the control of the parties, such as the huge backlog of cases, frequent adjournments, change in judicial assignments, etc.

ADR is encouraged in India, including for aviation-related disputes, for speedy resolution of disputes, governed by the Arbitration and Conciliation Act, 1996 (“Arbitration Act”). Section 89, CPC also provides that courts can refer cases for ADR – ie, arbitration, conciliation, and mediation.

Indian law does not prescribe any specific penalties for refusal to resolve disputes through ADR.

The Arbitration Act is largely based on the UNCITRAL Model Law on International Commercial Arbitration, with minor deviations. Amendments introduced in 2015, 2019, and 2021 (listed below) have resulted in some departures from the Model Law. For example, Section 9 allows parties to apply for interim measures not only before or during arbitration but also after the award is made and before enforcement.

• 2015 amendments:
1. removed the automatic stay on enforcement of awards when challenged (Section 36);
2. allowed parties to apply for interim relief in foreign-seated arbitrations (Section 9);
3. introduced statutory time limits for making awards (12 months, extendable to 18 months with consent) and a fast-track arbitration procedure for small claims (six months) (Sections 29A and 29B); and
4. limited the scope of the “public policy” ground for setting aside an award (Section 34).
• 2019 amendments:
1. established the Arbitration Council of India (Part IA);
2. prescribed timelines for completion of pleadings (six months) and award issuance (12 months) (Section 29A);
3. empowered the Supreme Court and high courts to designate arbitral institutions for appointing arbitrators (Section 11); and
4. introduced confidentiality provisions for arbitration proceedings (Section 42A).
• 2021 amendments:

1. omitted the Eighth Schedule that prescribed qualifications for arbitrators; and
2. allowed for a stay on enforcement of arbitral awards if the making of such awards was induced by fraud or corruption (Section 36).
• Draft Arbitration and Conciliation (Amendment) Bill, 2024 proposes:
1. recognition of emergency arbitration and enforcement of orders passed in India-seated emergency arbitrations;
2. delegation of certain powers, such as power to grant extension of time for passing awards and substitution of arbitrators, to arbitral institutions;
3. replacing the term “place” with “seat” in the Arbitration Act to align with international norms;
4. establishing an Appellate Arbitral Tribunal for setting aside award applications, currently handled by courts; and
5. recognising arbitration agreements executed through digital signatures and virtual hearings.

The proposed 2024 amendments were circulated for comments and have not yet come into force.

International arbitration has gained significant prominence in resolving aviation disputes in India. Key factors make arbitration the preferred mechanism for resolving international aviation disputes, such as parties can choose arbitrators with relevant expertise in specialised areas, flexibility regarding jurisdiction, applicable law, confidentiality of proceedings, efficiency and effective enforceability of arbitral awards, speedy adjudication, and limited judicial intervention.

The Supreme Court has dealt with arbitration of aviation disputes in Kalanithi Maran v Ajay Singh, SLP(C) No 14936 of 2024, where it upheld the high court’s decision to set aside an arbitral award in a dispute involving an Indian airline ownership transfer.

India does not have specialised aviation arbitration tribunals, but arbitration institutions like the Indian Council of Arbitration (ICA) and Mumbai Centre for International Arbitration (MCIA) support institutional arbitration across commercial sectors.

In June 2024, the Department of Expenditure, Procurement Policy Division, Ministry of Finance issued an Office Memorandum directing that in agreements involving the government/public sector undertakings, arbitration clauses should not be automatically included in procurement contracts/tenders. The Memorandum further restricts resorting to arbitration in disputes with a value less than INR10 crore (approximately USD1.2 million). Where the value of a dispute exceeds INR10 crore (approximately USD1.2 million) and an arbitration clause is proposed to be included, it should be based on careful application of mind and recording of reasons for such approvals.

The jurisdiction of Indian courts is determined by territorial, pecuniary value, and/or subject matter of the dispute (see 1.2 Court System).

• Territorial Jurisdiction: A court has territorial jurisdiction over a dispute if the defendant resides, carries on business, or works for gain within its territory, the cause of action arises within its jurisdiction, or the subject matter involves immovable property located within its territorial limits (Section 20 of the CPC).
• Pecuniary Jurisdiction: The jurisdiction of a court depends on the value of the claim or dispute.
• Subject Matter Jurisdiction: Certain courts/tribunals have exclusive jurisdiction over specific types of disputes. Statutory laws confer such jurisdiction, which may exclude other courts or tribunals, including arbitral forums, and there are also specialised courts and tribunals, as specified in 1.2 Court System.

The Limitation Act, 1963 (“Limitation Act”) governs the time limits within which civil actions, which would include those related to aviation, must be initiated.

• Commencement of the limitation period:
1. Once the limitation period begins, no subsequent inability to institute a suit stops it (Section 9, Limitation Act).
2. The limitation period starts from the date the cause of action arises. In case of a continuing breach, the limitation period runs from each day the breach continues (Section 22, Limitation Act).
3. Limitation may be extended under certain circumstances – eg, if a defendant acknowledges liability in writing, a fresh limitation period is computed from the date of the acknowledgment (Section 18, Limitation Act).
• Several statutes also provide for limitation periods:
1. The Carriage by Air Act, 1972 sets a two-year limitation for damage claims from the date of incident and excludes applicability of the Limitation Act.
2. The Competition Act, 2002 provides a three-year period for complaints related to anti-competitive practices or abuse of dominant position.
3. Under the CPA, complaints about deficient services must be filed within two years from the date of the cause of action, but delays may be condoned if sufficient cause is shown (Section 69(2)).
4. The Commercial Courts Act excludes the pre-institution mediation period from the limitation period (Section 12A(3)).
• The limitation period, if the claimant is a minor, insane, or otherwise legally incapacitated at the time the cause of action arises, is to be reckoned after the disability ceases (Section 6, Limitation Act).

Where a suit is filed beyond the period of limitation, the same is liable to be dismissed.

Where a pre-action is mandated – eg, when filing a suit against the government of India, any state government, or public officers, Section 80 of the CPC mandates that a two-month advance notice be given to the concerned entity.

Under the Commercial Courts Act and the Commercial Courts (Pre-Institution Mediation & Settlement) Rules, 2018, there is a mandatory pre-institution mediation requirement for commercial suits. If this step is not followed, the suit will be rejected by the court (Patil Automation (P) Ltd. v Rakheja Engineers (P) Ltd., (2022) 10 SCC 1). Pre-institution mediation is not mandatory where the plaintiff seeks urgent interim relief.

The initial pleading required to commence a civil action (which may include an aviation-related civil/commercial dispute) is typically referred to as a plaint and should include particulars such as cause of action, details of the plaintiff(s) and defendant(s), facts of the case, etc. For a suit under the Commercial Courts Act, there are additional mandatory filing requirements.

The court may grant leave to amend the plaint or pleading at any stage of the proceedings under the following conditions:

• It is required to determine the real question of controversy and ensure that justice is done between the parties.
• It corrects any omission or mistake in the plaint.
• It seeks to clarify the relief claimed, based on facts already contained in the plaint.
• It is done in good faith.
• The court will consider whether the amendment will lead to a multiplicity of proceedings and will balance the interests of justice with the need to avoid prejudice to the other party.

Order V and Section 27, CPC govern the process of service of court proceedings. A lawsuit is initiated by filing a plaint, after which the court issues a summons to the defendant.

• Service Where the Defendant is Located in India: The CPC allows various methods for serving summons to the defendant, such as personal service, substituted service, service by court officer, etc.
• Service Where the Defendant is Outside the Jurisdiction of India: The service is governed by the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters, 1965, to which India is a signatory.
• Consequences of Failing to Respond to Summons: The court may proceed with the case ex parte, based on the plaintiff’s evidence (Order 9 Rule 6, CPC).

The prerequisites for legal representatives to appear in Indian courts is that a person must be enrolled with a State Bar Council under the Advocates Act, 1961. These qualified advocates must be registered with the Bar Council of India (BCI), and they can represent parties before the Indian courts.

Foreign lawyers can visit India on a “fly in-fly out” basis for giving legal advice on foreign law or international legal matters. Foreign lawyers can only provide advice related to foreign law and are not allowed to represent clients in Indian courts or tribunals, as such casual visits would not amount to the “practice of law”, which would include appearances in courts, etc (Bar Council of India v A K Balaji, (2018) 5 SCC 3979). The Bar Council of India issued Bar Council of India Rules for Registration and Regulation of Foreign Lawyers and Foreign Law Firms in India in 2023, allowing foreign lawyers to practice foreign law in non-litigious matters, specifically in international commercial arbitration, with certain exceptions as laid down in the Rules.

Attorney-Client Privilege

Indian law recognises attorney-client privilege, which protects confidential communications, set out below:

• Sections 132 and 134, BSA prohibit legal professionals from disclosing communications made by the client in professional relationship.
• The Advocates Act, 1961 and the Bar Council of India Rules provide for lawyers’ obligation of confidentiality. Lawyers are not permitted to disclose communications made to them in the course of and for the purpose of their employment, the contents of documents acquired in the course of their employment, and legal advice given to the client during their professional engagement.

This privilege extends to both external counsel and in-house counsel, though the application to in-house counsel has been subject to interpretation by courts (Municipal Corporation of Greater Bombay v Vijay Metal Works, AIR 1982 Bom 6).

India follows the “costs follow the event” principle – ie, the unsuccessful party will be typically required to pay the “costs” incurred by the successful party at the discretion of the court per Section 35, CPC. “Costs” mean reasonable costs relating to witness expenses, legal fees, and any other expenses incurred. Compensatory costs and costs for delay can also be awarded. Whether the costs are reasonable is subject to the court’s discretion.

Order for Security

Order 25, CPC allows a defendant to request security for costs if (i) the plaintiff is not a resident of India or (ii) does not have sufficient immovable property or assets in India to satisfy any potential decree passed against him or her. Where the plaintiff does not possess sufficient immovable property in India, the court can order the plaintiff to provide security for the defendant’s anticipated costs, failing which, the court may dismiss the suit. Such amount is discretionary.

Order 41 Rule 10, CPC provides for security for costs of an appeal and is a discretionary power exercised where the court believes that the defendant may have difficulty recovering costs.

Courts can grant interim relief to preserve rights or property, pending resolution of a dispute, at their discretion. To obtain interim relief, the party must satisfy the following criteria: (i) a prima facie case exists in favour of the party seeking the order; (ii) the party will suffer irreparable harm; and (iii) the balance of convenience lies with the party requesting the relief.

• A party can seek temporary injunctions to preserve the status quo and restrain a defendant from actions like property damage, alienation (Section 37, Specific Relief Act; Order 39, CPC), or perpetual injunctions to prevent further breaches of an obligation that is capable of specific performance or wrongful acts that would cause irreparable harm (Section 38, Specific Relief Act; Section 94, CPC). Ex parte injunctions may also be issued in urgent cases where delay causes irreparable harm.
• Under Order 38, CPC, courts may require the defendant to furnish security to produce and place at the disposal of the court the property or the value of the same to satisfy a decree, if there is a risk of asset disposal or absconding. Conditional attachment of property may occur if the defendant fails to show cause. 
• Under Order 40, CPC, a receiver can be appointed to manage/preserve property or assets during the pendency of a suit.

Summary Resolution and Dismissal of Suit

Indian courts can grant summary judgment to resolve certain claims without a full trial under Order 13-A of the CPC, where either party has no real prospect of succeeding or defending the claim, and there is no other compelling reason why the claim should not be disposed of before the recording of oral evidence.

A party can also file an application under Order 7, Rule 11 of the CPC, seeking rejection of the suit at threshold, if it does not disclose a cause of action, is barred by limitation, or is barred by law.

If the defendant believes the plaintiff’s pleadings are irrelevant, scandalous, or immaterial, they may file a motion to strike out the pleadings under Order 6, Rule 16 of the CPC.

Indian courts have the discretion to grant injunctive relief under specific conditions (Section 2.8). The courts are also empowered to grant: (i) asset-freezing injunctions (known as “Mareva injunctions”); (ii) ad-personam injunctions to restrain the judgment debtor or the party against whom it is granted, from disposing of its assets otherwise than in the usual course of business, beyond the jurisdiction of the concerned court); and (iii) anti-suit injunctions (which are made against a party in personam restraining them from instituting a legal action or from continuing with proceedings that have already been instituted – whether domestic or foreign).

Mareva Injunctions

Mareva injunctions arise from Order 38, Rule 5, CPC, which deals with attachment before judgment (see 2.8 Interim, Early Judgment and Dispositive Applications), and are granted sparingly. To obtain such an injunction, a plaintiff must inter alia establish that:

• There is a strong prima facie case against the defendant, and the plaintiff must fully disclose all relevant matters when seeking an injunction without notice.
• The plaintiff will suffer irreparable harm if the injunction is not granted.
• The balance of convenience favours issuing it.
• The court has jurisdiction over the cause of action for the Mareva injunction.
• The plaintiff has a “good arguable case”, meaning there are real prospects of success based on the evidence before the court.
• The defendant’s assets are within the jurisdiction, and there is a real risk they may be removed or dissipated to frustrate a successful judgment.

Anti-Suit Injunctions

An anti-suit injunction can be granted where (Modi Entertainment Network and Anr v WSG Cricket PTE Ltd, (2003) AIR SC 1177):

• the defendant is amenable to the court’s personal jurisdiction; and
• denying the injunction would result in injustice.

The principle of comity – ie, respecting the court where commencement or continuance of the proceedings is being challenged, must be considered.

If multiple forums are available, the court will choose the most convenient one and may grant an injunction if another forum is oppressive, vexatious, or non-convenient.

Courts typically will not grant an injunction against a party that has agreed to the exclusive jurisdiction of another court, except in exceptional cases where injustice would result.

The burden of proving that the chosen forum is a forum non-conveniens or oppressive/vexatious lies with the party making that claim.

Time Limits

The timeline varies for every court in India; however, in urgent cases, injunctive relief can be granted urgently at the court’s discretion. During vacation, vacation benches can be approached for interim reliefs.

Binding Effect of Injunctions on Third Parties

Injunctions cannot be granted against individuals/entities who are not a party to the claim, without giving them the opportunity to be heard (Acqua Borewell Pvt. Ltd. v Swayam Prabha and Ors., 2021 SCC OnLine SC 1065), except in cases, inter alia, where an injunction is sought against a tenant of a property. However, such third parties may be impleaded as parties, if the court deems fit, before granting such an opportunity.

Consequences of Disregarding an Injunction

An injunction stays in force unless specifically stayed or modified. If the respondent disregards the injunction (despite being in notice of the same), the court may order attachment of the assets of the respondent and may also order such party to be detained. In Surjit Singh and Ors. v Harbans Singh and Ors., (1995) Supp. (3) SCR 354, the Supreme Court held that when an injunction is violated (eg, assets are sold or transferred), the court has the authority to treat those transactions as invalid for its purposes, even if they were valid under the general law. The respondent may also be held in contempt of court under the Contempt of Courts Act, 1971.

Parties may seek specific documents from the other party relevant to the dispute, by serving a notice on the opposing party, asking them to produce documents referenced in their pleadings or affidavits. If the notice is not complied with, the party seeking discovery can apply to the court to compel the production of the documents (Order 11, CPC). The court has the discretion to order the production of documents, and it can inspect documents in cases where privilege is claimed by the counterparty as a defence.

The court can order discovery of documents based on certain factors, such as (i) the documents are in the possession or control of the opposing party; (ii) the documents are relevant and necessary for the fair disposal of the case; and (iii) the documents are material to the matter in controversy. Courts can impose limits to control the scope of document production. The court may restrict discovery to documents that are directly related to the case.

Discovery in India involves both document production as set out above and witness testimony (see 3.9 Discovery and Evidence).

Aviation-related disputes follow the SAME procedural rules for conducting trials and admission of evidence laid out in the CPC and BSA, as set out above in 1.1 Legal System.

In India, there are no jury trials. All civil trials, including those related to aviation, are adjudicated solely by a judge(s). The judge(s) makes the final decision based on the facts and legal arguments presented.

Proceedings in India are typically held in open court, meaning that members of the public can attend hearings, except where the court deems fit to hold the hearings confidentially in certain circumstances.

While hearings are open to the public, transcripts of court proceedings are generally not made publicly available in India. Judgments and orders, however, are public records and can be accessed.

Settlement terms are generally confidential, and parties often include a non-disclosure clause in the agreement. However, there is no statutory obligation to keep such terms confidential, and under certain circumstances they may have to be disclosed.

For instance, if the parties wish to have the settlement terms formalised in a court order, an application for a consent decree may be filed (Order 23, Rule 3, CPC). In the event of a suit being settled, in whole or in part, by virtue of a compromise/settlement, the same is to be reduced to writing and signed by the parties, and the court shall pass a decree in accordance with such an agreement, which can be enforced. Such a consent decree can be enforced as a decree of the court by filing execution proceedings in accordance with Order 21 of the CPC, in case either party fails to comply with the consent decree.

In the absence of the settlement terms being formalised in a court order, the settlement terms are a private agreement between the parties, and in case either party fails to comply with the terms, the same would be enforced by filing suits for breach of contract.

• A settlement agreement can be set aside if, inter alia, it was obtained through fraud, misrepresentation, or a mistake (Ajanta LLP v Casio Keisanki Kabushiki Kaisha, (2022) 5 SCC 449).
• Courts have the discretion to set aside a consent decree if the agreement is not honoured by either party (Shivshankar Gurgar v Dilip, (2014) 2 SCC 465).

• The court, using its inherent powers, may also correct any clerical or arithmetical errors in a consent decree to align it with the terms of the settlement (Compack Enterprises India (P) Ltd. v Beant Singh, (2021) 3 SCC 702).
• When the mistake in a consent decree is patent or obvious, the same can be modified or altered by courts (Ajanta LLP v Casio Keisanki Kabushiki Kaisha, (2022) 5 SCC 449).

A successful litigant may be entitled to injunctive relief, damages, and/or specific performance of the contract (see 2.8 Interim, Early Judgment and Dispositive Applications and 2.9 Injunctive Relief).

The primary relief awarded in civil cases is damages. The calculation of damages follows principles under the Indian Contract Act, 1872 (Sections 73 and 74) and depends on the nature of the breach, and parties are also free to agree on a formula for computation of damages. Courts may also grant exemplary damages which are punitive in nature since they intend to punish the defendant and not merely compensate or deprive the defendants of the profits made; they may be granted in exceptional cases and Indian law does not provide for a blanket right to punitive damages (Koninlijke Philips NV v Amazestore, (2019) 260 DLT 135).

There is no automatic cap on the amount of damages that can be recovered. However, parties can include liability caps (Mcdermott International Inc v Burn Standard Co. Ltd. & Ors, (2006) 11 SCC 181). 

Courts can also grant interest on the damages amount.

In aviation-related trials, damages are also governed by the Carriage by Air Act, 1972 and Bhartiya Vayuyan Vidheyak, 2024 (which replaced the Aircraft Act, 1934).

An appeal can be filed against the decree passed by a lower court (Section 96, CPC)). A second appeal can be made only on substantial questions of law (Section 100, CPC). At this stage, the appellate court cannot re-examine the factual aspects of the case. A further appeal can be made before the Supreme Court, which can also grant a special leave to appeal (Article 136, Constitution).

Appeals typically involve a rehearing of the case, and the appellate court has the authority to reassess the evidence and make fresh findings. Generally, new arguments that were not raised at the first instance cannot be raised on appeal, except where fundamental legal questions are involved.

Not all orders in a civil case are appealable and only specific orders in CPC may be appealed. Other orders can be challenged before the high courts through their writ jurisdiction (Article 226, Constitution), their powers of revision (Section 115, CPC), or the review powers held by the courts.

Requirements of an Arbitration Agreement

Section 7 of the Arbitration Act provides that an arbitration agreement must be in writing, irrespective of whether it is a clause in a contract or a separate agreement, and must be contained in:

• a document signed by the parties;
• an exchange of letters or other communication means (electronic or otherwise) which provides a record of the agreement; or
• an exchange of statements of claim and defence, where one party asserts the existence of the agreement and the other does not deny it.

Arbitrability

Section 2(3) of the Arbitration Act provides that Part I of the Act shall not affect any other law in force by virtue of which “certain disputes may not be submitted to arbitration”. An arbitral award may be set aside under Section 34 and enforcement of an award may be refused under Section 48 of the Arbitration Act, if the subject matter of the dispute is not arbitrable – ie, not capable of settlement by arbitration.

In Vidya Drolia and Ors v Durga Trading Corporation, (2021) 2 SCC 1, the Supreme Court laid down the following test to ascertain whether a dispute is non-arbitrable:

• when the cause of action and subject matter of the dispute are related to actions in rem;
• when the cause of action and subject matter of the dispute affect third party rights, or where they operate against the world in general;
• when the cause of action and subject matter of dispute relate to inalienable sovereign and public interest functions of the state; and
• when the subject matter of the dispute is expressly or by necessary implication non-arbitrable per mandatory statutes.

The courts have held that disputes relating to rights and liabilities arising from criminal offences, disputes involving “serious allegations” of fraud, matrimonial disputes, testamentary and succession-related matters, and anti-trust/competition disputes are non-arbitrable.

Law Governing Arbitration Agreement

The law governing an arbitration agreement is typically determined by the seat of arbitration, where parties fail to expressly specify the choice of law. In Reliance Industries Ltd. v Union of India, (2014) 7 SCC 603, the Supreme Court held that the law of the seat (which would be applicable to the filing of the award and setting aside) would be the proper law of the arbitration agreement, in the absence of an express choice of the parties.

The Supreme Court has also held that in the absence of a designated seat or venue of arbitration, the determining factor for jurisdiction would be the cause of action (BBR (India) Pvt. Ltd. v S.P. Singla, (2023) 1 SCC 693).

Separability

Section 16 of the Arbitration Act recognises the principle of separability. An arbitration clause is considered independent of the rest of the contract.

Section 16(1) of the Arbitration Act recognises the principle of kompetenz-kompetenz, which allows arbitral tribunals to rule on their own jurisdiction, including objections related to the existence or validity of the arbitration agreement (Duro Felguera SA v Gangavaram Port Ltd., (2017) 9 SCC 729).

Challenge to the Jurisdiction of the Tribunal

A party may challenge the tribunal’s jurisdiction immediately upon commencement of the arbitration, or once a tribunal is constituted under Section 16. After the award, challenges may be made under Section 34 of the Arbitration Act (to set aside an arbitral award), or an appeal under Section 37 (appeal against an order of the tribunal accepting objection(s) to its jurisdiction). There is no appeal if the tribunal rejects jurisdictional objections; the challenge can only be made after the award under Section 34.

Intervention by Courts

Courts have the power to appoint arbitrators under Section 11 if the parties fail to agree on the arbitrators. Parties can also file an application before the court for reference of disputes to arbitration under Section 45 of the Arbitration Act in cases of foreign-seated arbitrations.

Courts may also intervene in the selection of the arbitrators if the mandate of an arbitrator is terminated owing to the de jure or de facto inability of the arbitrator to continue with its mandate.

Joinder of Non-Signatories

The Arbitration Act provides for “any person claiming through or under him” in Sections 8 and 45, allowing third-party intervention if they had a claim through a signatory to the arbitration agreement.

In Cox & Kings Ltd v SAP India Pvt Ltd & Anr., (2024) 4 SCC 1, the Supreme Court recognised two ways to bind non-signatories to arbitration: the consent-based path (where non-signatories express agreement) and the non-consensual path (eg, through piercing the corporate veil or agency principles). Additionally, voluntary intervention is allowed if all parties consent.

Section 42A of the Arbitration Act requires an arbitrator, arbitral institution, and the parties to the arbitration agreement to maintain confidentiality of all arbitration proceedings, except the arbitral award, where its disclosure is necessary for the purpose of the implementation and enforcement of the arbitral award.

The rules of arbitration of most arbitral institutions include provisions to maintain confidentiality of arbitral proceedings. A party or tribunal member may disclose such information only if sought through an order of a court. Otherwise, written consent of all parties is required to disclose. If a party breaches confidentiality, the tribunal can take appropriate measures, including issuing an award for sanctions/costs.       

An arbitral tribunal has the power to grant interim relief, unless otherwise agreed by the parties (Section 17, Arbitration Act). However, this power can be exercised only until the passing of the award, after which the arbitral tribunal is functus officio and parties will need to approach a court for reliefs post-award. An order of the arbitral tribunal shall be enforceable as if it were a court’s order.

The arbitral tribunal may direct either party to take any interim measure of protection as it may deem necessary to protect the subject matter of the dispute.

Interim reliefs can also be granted by courts under Section 9, Arbitration Act. Parties may approach a court for interim reliefs before or during arbitral proceedings or at any time after making the arbitral award but before it is enforced. The court shall not entertain any application for interim relief after the tribunal has been constituted unless it finds that circumstances exist that may not render the remedy granted by the tribunal efficacious.

Recourse to Indian courts for interim reliefs is also available to parties to a foreign-seated arbitration (unless otherwise agreed) under Section 2(2), Arbitration Act (PASL Wind Solutions Private Limited v GE Power Conversion India Private Limited (Supreme Court of India, Civil Appeal No 1647 of 2021).

The Arbitration Act does not explicitly provide a provision for seeking security for costs in arbitration. However, tribunals have discretionary power to order security for costs, under Section 27 (on tribunal powers regarding procedure) and Section 38 (on conduct of the arbitral proceedings), when:

• there is a concern that a party may be unable to pay the arbitral costs or the award in the event they lose the case;
• the claimant is not likely to be able to enforce the award due to insufficient assets or is a foreign entity without a presence in India; or
• there is evidence of bad faith in initiating or defending the arbitration.

The Arbitration Act governs arbitration procedure in India.

• Powers:
1. determine procedural rules (Section 19);
2. grant interim reliefs (Section 17);
3. determine the procedure for submissions of claims/defences and timelines (Section 23); and
4. issue a reasoned award (Section 31).
• Duties:
1. disclosure of conflicts of interest (Section 12);       
2. act independently and impartially (Section 14);
3. ensure equal treatment of the parties (Section 18);
4. ensure procedure is efficient (Section 19);
5. apply the applicable law (Section 28); and
6. determine costs of the arbitration (Section 31).

Section 11, Arbitration Act allows a person of any nationality to be appointed as an arbitrator, unless the parties agree otherwise. Before appointment, an arbitrator must disclose any circumstances under Section 12 that may raise doubts about their impartiality, independence, or ability to commit sufficient time to the arbitration, failing which, consequences shall follow, such as termination of the mandate.

See 2.6 Legal Representation in Court and Legal Privilege regarding who can represent parties in India.

Generally, the losing party pays the costs of the successful party (Section 31A of the Arbitration Act). These costs may include arbitrators’ fees, witnesses’ expenses, legal fees, administrative fees and other related costs. While determining costs, the tribunal considers factors like the parties’ conduct, frivolous counterclaims and instances of refusal of settlement offers.

Sections 38 and 39, Arbitration Act allow the tribunal to fix the amount of deposit as an advance for costs and have a lien on the award for any unpaid costs. If not paid, the tribunal can withhold the award’s issuance.

The Arbitration Act allows for both pre-award and post-award interest to be included in the sums awarded in the award under Section 31(7). The rate of interest awarded must be compensatory and not punitive or unconscionable (Vedanta Limited v Shenzhen Shandong Nuclear Power Construction Company Limited, (2019) 11 SCC 465).

There are no specific rules governing evidentiary matters in arbitration in India. Section 19, Arbitration Act provides that an arbitral tribunal will not be bound by the BSA and allows parties to agree on the procedural rules to be followed, and if parties do not agree, the tribunal can decide on the same.

Under Section 23, Arbitration Act, parties must submit all relevant documents/refer to the documents they consider to be relevant or other evidence they will submit.

For obtaining evidence, Section 27, Arbitration Act allows a party, with the permission of the tribunal, or the tribunal to apply to court for assistance in taking evidence. The court can issue summonses and commissions to examine witnesses and issue summons for the production of documents. Failure to comply with such orders may result in penalties and punishments equivalent to those applicable for similar offences in court proceedings.

Indian courts also have the authority under Section 31 read with Order 16, CPC to compel domestic witnesses to provide evidence by issuing a summons. For foreign witnesses, Section 77 read with Order 26, CPC allow Indian courts, upon determining the necessity of witnesses’ evidence, to issue a letter of request or commission to a foreign court to examine such a witness before it. Sections 27(3) and (4) of the Arbitration Act extend this power to arbitration proceedings and the court can order that evidence be presented directly to the tribunal. In Stemcor (S.E.A.) Pte Limited and Ors. v Mideast Integrated Steels Ltd., 2018 SCC OnLine Bom 1179, the Bombay High Court allowed a foreign witness to be examined in Singapore on commission for arbitration proceedings.

Section 31, Arbitration Act provides that an arbitral award will be in writing and signed by the tribunal’s members. If the tribunal comprises more than one member, signatures of the majority of the members will suffice, with the reason for any omitted signature being stated. The award must be reasoned unless the parties have agreed otherwise, or the award is on the agreed terms of a settlement between the parties, and must state its date and place of arbitration as determined by the parties/arbitral tribunal.

Section 29A, Arbitration Act requires arbitration proceedings to be completed within 12 months from the date of completion of pleadings, with an extension of six months by mutual consent of the parties. If not made within the above period, the parties can make an application to the court for extension of the tribunal’s mandate.

For remedies a tribunal may grant, see 3.4 Preliminary and Interim Relief.

Domestic arbitration awards can be challenged before courts under Section 34 of the Arbitration Act, while foreign awards can only be resisted in enforcement proceedings on limited grounds under Sections 48 and 57 of the Arbitration Act.

A domestic award can be set aside under Section 34 on the following grounds:

• The party was under incapacity.
• The arbitration agreement is invalid.
• The party was not properly notified of the appointment of an arbitrator or of arbitral proceedings or was otherwise unable to present his or her case.
• The award deals with a dispute not covered within the terms of the submission to arbitration or contains decisions on matters beyond the scope of the submission to arbitration.
• The composition of the tribunal or the arbitral procedure was not per the agreement between the parties.
• The dispute is not arbitrable.
• The award conflicts with public policy of India.
• The award is vitiated by patent illegality (this ground is available only for India-seated arbitrations where both parties are Indian entities – ie, domestic awards – as clarified by the 2015 amendment to the Arbitration Act).

Courts do not sit in appeal over the award under Section 34 and would not interfere with the award if the tribunal’s decision is a plausible one, even if a different view may be possible on the same evidence (NTPC Ltd. v Deconar Services (P) Ltd., 2021 SCC OnLine SC 498). The courts also do not re-evaluate the merits or the evidence.

After a Section 34 application is decided, an aggrieved party can appeal under Section 37 of the Arbitration Act, with a further appeal before the Supreme Court under Article 136 of the Constitution.

Publicly Accessible information

Property records, providing details about ownership of immovable property, typically maintained by state revenue departments, are publicly accessible.

Information on property ownership can be obtained from land records or local municipal corporations.

The Registrar of Companies (RoC) under the Ministry of Corporate Affairs (MCA) maintains corporate records, including annual financial statements, shareholding patterns, and details of directors, etc.

Freezing Orders

Order 39 of the CPC deals with temporary injunctions or freezing orders.

Section 94 of the CPC permits courts to issue freezing orders.

Asset Disclosure Orders

Order 21, Rule 41 of the CPC allows a judgment creditor to request asset disclosure from the judgment debtor. If the debtor fails to comply, the court can summon them for examination.

Section 51 of CPC provides for the attachment of property to enforce a decree. If the defendant refuses to disclose their assets, the creditor can apply for the attachment of property.

Other Mechanisms

After a judgment, under Order 21 of the CPC, the judgment creditor can approach the executing court for execution of the decree. The court may order the attachment and sale of the defendant’s assets if it is shown that they have assets available for satisfaction of the decree.

The judgment creditor may seek a garnishee order under Order 21, Rule 46A of the CPC, which allows the court to order the bank or other third parties holding the defendant’s funds to pay the creditor directly from the defendant’s accounts.

A domestic judgment or decree can be enforced by filing an execution petition under Order 21 of the CPC before a court of competent jurisdiction in India within 12 years from the date of the judgment or decree.

The court then considers objections raised by the judgment debtor (Order 21, Rule 23, CPC) and may order the execution via one or more of the following modes: attachment and sale, or by sale without attachment (Order 21, Rule 30, CPC), arrest and detention of the judgment debtor (Order 21, Rule 37, CPC), and appointment of a court receiver.

Execution proceedings in India are often protracted, due to factors set out in 1.2 Court System. The process can take upwards of 18 months or more.

A defendant can oppose the enforcement of a domestic judgment in several ways, including:

• The defendant can challenge the judgment if they were not properly served with the notice or summons on the grounds of “lack of jurisdiction” or “non-service” of notice.
• A defendant can appeal a decree under Section 96 of the CPC and a second appeal under Section 100. Under Order 41, Rule 5, the defendant can apply for a stay of execution of the decree pending appeal.
• Order 21, Rule 29 of the CPC provides for the suspension of execution of a decree under certain conditions, if the defendant has filed an appeal or seeks a stay.

The enforcement of foreign judgments depends on whether the country where the judgment is delivered is from a reciprocating country under Section 44A of the CPC.

Reciprocating Territory

Certain territories have been declared “reciprocating territories” under Section 44A of the CPC. A judgment passed by a court in a reciprocating territory can be enforced as if it were a judgment of an Indian court (as outlined in 4.2 Enforcing Domestic Judgments).

Non-Reciprocating Territory

Judgments from non-reciprocating countries cannot be directly enforced, and a fresh suit must be filed in India on the basis of the foreign judgment (Moloji Nar Singh Rao v Shankar Saran, AIR 1962 SC 1737), and the resulting judgment/domestic decree will then be executed/enforced per the CPC.

A foreign judgment must be final and not fall under the exceptions in Section 13 of the CPC – ie, other than where:

• it has not been pronounced by a court of competent jurisdiction;
• it has not been given on the merits of the case;
• it appears on the face of the proceedings to be founded on an incorrect view of international law or a refusal to recognise the law of India in cases in which such law is applicable;
• the proceedings in which the judgment was obtained are opposed to natural justice;
• it has been obtained by fraud; and/or
• it sustains a claim founded on a breach of any law in force in India.

A regular suit in India can be filed (see 1.1 Legal System) and thereafter, once a favourable decree is passed, execution proceedings will have to be initiated (see 4.2 Enforcing Domestic Judgments).

Sections 13 and 14 of the CPC provide for the rule of res judicata for foreign judgments – ie, a judgment delivered by a foreign court of competent jurisdiction can be enforced by an Indian court and will operate as res judicata between the parties with exceptions in Section 13 (Section 2.4), where recognition and enforcement of a foreign judgment can be refused. A court’s decision on the conclusiveness of a foreign judgment or decree may be challenged by way of a review or appeal under the CPC.

A judgment obtained from a non-reciprocating territory can be enforced by filing a new suit in an Indian court.

Domestic Award

A court will not enforce an award until three months after it is received (with a 30-day extension upon sufficient cause) (Section 34(3)), during which, the award may be challenged under Section 34.

Foreign Award

A foreign award is enforceable under Part II of the Arbitration Act if: (i) it relates to commercial matters under Indian law (India adopts the “commercial” reservation under the 1958 New York Convention and Geneva Convention, which are ratified by India); (ii) it follows an arbitration agreement covered by these Conventions; (iii) it involves parties from a jurisdiction notified by the central government; and (iv) the award is final.

For enforcement, the party must produce the original or authenticated copy of the award, the arbitration agreement, and proof of the award’s foreign status.

For grounds to challenge enforcement of an award and the appeal mechanism available, see 3.11 Appeals.

Enforcement of a foreign award may be refused (and cannot be set aside) under Section 48 of the Arbitration Act on the same grounds as domestic awards (subject to a narrower definition of what would be in conflict with public policy of India), and also if (i) the award was set aside or suspended in the country it was made in, and/or (ii) the dispute cannot be arbitrated under Indian law.

Under the CPC, foreign states and their instrumentalities can be sued with the prior written consent of the Indian government. However, this consent may not be required if the matter is governed by special laws (eg, the Carriage by Air Act, 1972 or CPA), or where legal proceedings are not a suit.

The doctrine of sovereign immunity is recognised in:

• Section 86 of the CPC, which mandates government consent for lawsuits against foreign states in India; and
• the Diplomatic Relations (Vienna Convention) Act, 1972, which grants certain immunities to diplomatic missions and their members based on the Vienna Convention; a few articles of the Convention, including articles 29, 30, 31, 32, 37, 38 and 39, have been given the force of law in India.

The doctrine of sovereign immunity in India is not absolute, and foreign states do not have immunity in cases involving their commercial or contractual activities in India (Ethiopian Airlines v Ganesh Narain Saboo, Civil Appeal No 7037 of 2004).

In KLA Const. Technologies Pvt. Ltd. v The Embassy of Islamic Republic of Afghanistan, 2021 SCC OnLine Del 3424, the Delhi High Court ruled that prior consent under Section 86 is not required for enforcing arbitral awards against foreign states, and foreign states cannot claim sovereign immunity against enforcement in commercial matters.

Certain key developments are below:

• The Ministry of Corporate Affairs issued Notification No S.O. 4321(E) dated 3 October 2023, exempting transactions involving aircraft, aircraft engines, airframes, and helicopters from the moratorium provisions of the Insolvency and Bankruptcy Code, 2016. This exemption is crucial for creditors and lessors, as it prevents the loss of rights during insolvency proceedings.
• The Ministry of Civil Aviation has introduced the Aircraft (Security) Rules, 2023, to enhance civil aviation security in line with international conventions. These rules outline procedures for addressing security concerns, protecting passengers, crew, and aviation assets. They also provide a framework for investigating and rectifying security incidents, aiding in maintenance of the integrity of India’s aviation sector.
• Jet Airways, which suspended operations in April 2019 due to financial issues, had been undergoing CIRP (Corporate Insolvency Resolution Process) since June 2019. The Supreme Court by its order dated 7 November 2024, directed Jet Airways into liquidation. Jet Airways is now undergoing liquidation.
• The Bharatiya Vayuyan Adhiniyam 2024 has come into force with effect from 1 January 2025, replacing the Aircraft Act, 1934, establishing new regulations to protect passenger rights and ease of doing business.

• The Protection of Interests in Aircrafts Objects Act, 2025 has come into force with effect from with effect from 1 May 2025. The said Act inter alia aims to provide for protection of interests in aircraft objects and to implement (i) the Convention on International Interests in Mobile Equipment, and (ii) the Protocol to the Convention on International Interests in Mobile Equipment on Matters specific to Aircraft Equipment, each signed at Cape Town on 16 November 2001.