The constitutional validity of the New Delhi International Arbitration Centre Act, 2019 was upheld, emphasizing legislative safeguards for arbitrator independence and impartiality while dismissing concerns of governmental bias.

JUDGMENT

1. The instant Public Interest Litigation has been filed by one, Mr. Abhishek Kumar, a Lawyer, challenging the constitutional validity of Section 5 (`Impugned Section') of the New Delhi International Arbitration Centre Act, 2019 (`Act').

2. The Act was promulgated on 26.07.2019 and came into force from 02.03.2019. The Act envisages the creation of New Delhi International Arbitration Centre (`NDIAC/Centre'). The purpose of the Act is to create an independent and autonomous regime for institutionalised arbitration. The Act is also meant for revamping the pre-existing International Centre for Alternate Dispute Resolution and to utilise its infrastructure, and other facilitates.

3. The Impugned Section deals with the composition of members of the Centre, and their appointment. It reads as under:

"5. The Centre shall consist of the following Members, namely:

(a) a person, who has been a Judge of the Supreme Court or a Judge of a High Court or an eminent person, having special knowledge and experience in the conduct or administration of arbitration law or management, appointed by the Central Government in consultation with the Chief Justice of India--- Chairperson;

(b) two eminent persons having substantial knowledge and experience in institutional arbitration, both domestic and international, appointed by the Central Government--Full-time or Part-time Members;

(c) one representative of a recognised body of commerce and industry, chosen on rotational basis by the Central Government--Part-time Member;

(d) Secretary, Department of Legal Affairs Ministry of Law and Justice or his representative, not below the rank of the Joint Secretary--Member, ex officio

(e) one Financial Adviser nominated by the Department of Expenditure Ministry of Finance-- Member, ex officio; and

(f) Chief Executive Officer--Member, ex officio."

4. Section 14 of the Act empowers the Centre to maintain a panel of accredited arbitrators, conciliators, and mediators. Section 28 of the Act lays down the procedure for the empanelment of such arbitrators, in the following manner:

"14. The objects of the Centre shall be--

(a) to bring targeted reforms to develop itself as a flagship institution for conducting international and domestic arbitration;

(b) to promote research and study, providing teaching and training, and organising conferences and seminars in arbitration, conciliation, mediation and other alternative dispute resolution matters;

(c) to provide facilities and administrative assistance for conciliation, mediation and arbitral proceedings;

(d) to maintain panels of accredited arbitrators, conciliators and mediators both at national and international level or specialists such as surveyors and investigators;

(e) to collaborate with other national and international institutions and organisations for ensuring credibility of the Centre as a specialised institution in arbitration and conciliation;

(f) to set-up facilities in India and abroad to promote the activities of the Centre;

(g) to lay down parameters for different modes of alternative dispute resolution mechanisms being adopted by the Centre; and

(i) such other objectives as it may deem fit with the approval of the Central Government.

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28. (1) The Centre shall, establish a Chamber of Arbitration which shall empanel the Arbitrators and also scrutinise the applications for admission in the panel of reputed arbitrators to maintain a permanent panel of arbitration.

(2) The Chamber of Arbitration shall consist of experienced arbitration practitioners of repute, at national and international level and persons having wide experience in the area of alternative dispute resolution and conciliation.

(3) The Centre shall by regulations lay down the criteria for admission to the panel of the cadre so as to maintain a pool of reputed arbitrators having expertise in international commercial arbitration and arbitration other than international commercial arbitration.

(4) The Registrar to the Secretariat