Arbitration, Mediation and Conciliation · Arbitration: Introduction, Agreements and its Institutions

Arbitral Institutions and the Arbitration Council of India

Updated 11 October 2026 · Fact-checked

An arbitral institution is a body that administers arbitrations under its own rules, helps appoint arbitrators and manages fees and procedure. In institutional arbitration the institution runs the case. In ad hoc arbitration the parties and tribunal run it themselves. Exam answers should compare the two and apply the facts given.

Understand Arbitral Institutions and Arbitration Council of India

Arbitration can run in two ways. In ad hoc arbitration, the parties and the tribunal design the procedure themselves. No body supervises the case. It is flexible and can be cheap, but it depends on cooperation. If one party stalls, you may have to go to court.

In institutional arbitration, the parties agree that a named institution will administer the case under its rules. The institution typically receives the request, helps with appointment of arbitrators, fixes or scrutinises fees, and keeps the process moving. The Act recognises both. Section 2(1)(a) says "arbitration" means any arbitration whether or not administered by a permanent arbitral institution.

The parties adopt the rules by agreement. Section 2(8) says that where the Act refers to an agreement of the parties, that agreement includes any arbitration rules referred to in it. So if the clause says "under the rules of X", those rules become part of the parties' agreement. Section 2(6) adds that where the Act leaves the parties free to decide an issue, they may authorise any person, including an institution, to decide it. Section 28 is the exception: the parties cannot hand over the choice of substantive law this way.

Appointment is where institutions matter most. Under Section 11(2) parties are free to agree the appointment procedure, and they can name an institution to appoint. If that procedure fails, Section 11(6) lets a party ask the Supreme Court or High Court, or a person or institution designated by that Court, to take the necessary measure, unless the agreement provides other means. Under Section 11(6B), such designation is not a delegation of judicial power.

Well-known institutions include the Indian Council of Arbitration (ICA) in India, the International Chamber of Commerce (ICC) in Paris, the London Court of International Arbitration (LCIA) and the Singapore International Arbitration Centre (SIAC). Others in India include the Mumbai Centre for International Arbitration and the Delhi International Arbitration Centre. The Arbitration Council of India was introduced by the 2019 amendment to grade institutions and accredit arbitrators. Its provisions were not brought into force. So treat it as a proposed body, and state this clearly in your answer.

Key rules to remember

Meaning of arbitration: Section 2(1)(a): arbitration = any arbitration, whether or not administered by a permanent arbitral institution; Both ad hoc and institutional arbitration are valid under the Act.
Institutional rules become part of the agreement: Section 2(8): agreement of the parties includes any arbitration rules referred to in that agreement; Naming an institution's rules in the clause adopts them.
Parties may authorise an institution: Section 2(6): where the Part leaves parties free to determine an issue, they may authorise any person, including an institution, to determine it; Exception: this does not apply to Section 28.
Agreed appointment procedure: Section 11(2): parties are free to agree the appointment procedure, subject to Section 11(6); This is where an institution is usually named as appointing authority.
Failure of appointment procedure: Section 11(6): a party may ask the Supreme Court or High Court, or its designated person or institution, to take the necessary measure; Applies if a party, the parties or arbitrators, or an institution fails to act, unless the agreement gives other means.
Designation not delegation: Section 11(6B): designation by the Court is not a delegation of judicial power; This supports Court-designated institutions.
Which Court: Section 11(12): international commercial arbitration → Supreme Court; other arbitration → High Court; The High Court is the one within whose limits the principal Civil Court is situated.
Fees: Section 11(14): High Court may frame fee rules using the Fourth Schedule rates; Does not apply to international commercial arbitration, or where parties agreed fees under an institution's rules.

How to solve Arbitral Institutions and Arbitration Council of India questions

Use this method for any question on institutions, ad hoc versus institutional arbitration, or the Council.

1Identify what is asked: a definition, a comparison, a role of an institution, or a fact-based problem.
2Say whether the arbitration is ad hoc or institutional, using the arbitration clause in the facts.
3State the law: Section 2(1)(a), 2(6) and 2(8), and Section 11 if appointment is involved.
4Apply the facts: which rules were adopted, who is the appointing authority, and what failed.
5If appointment failed, say who to approach: the Supreme Court for international commercial arbitration, else the High Court, or its designated institution.
6For the Arbitration Council of India, state that its provisions were introduced by amendment but not brought into force.
7Conclude in one clear sentence, and add a practical drafting point such as naming the institution and rules in the clause.

Quickest way: Three-line institutional arbitration answer

When to use it: Use when time is short or the question is a short note.

Line 1: define institutional arbitration and contrast it with ad hoc (Section 2(1)(a)).
Line 2: name the institution's functions: rules, appointment, fee management, administration, and cite Sections 2(8) and 11(2).
Line 3: give examples: ICA, ICC, LCIA, SIAC, and mention the Arbitration Council of India as not yet in force.

Common mistakes in Arbitral Institutions and Arbitration Council of India

Saying the Act requires arbitration to be institutional.
Students assume administration by a body is the norm.
Fix: Quote Section 2(1)(a): the Act covers arbitration whether or not administered by a permanent institution.
Stating that the Arbitration Council of India is functioning.
The amendment text exists, so students assume it is operational.
Fix: Write that the provisions were not brought into force, so it is a proposed body.
Treating an institution's rules as separate from the agreement.
Students forget Section 2(8).
Fix: Say the rules referred to in the clause form part of the parties' agreement.
Going to court first when the clause names an institution as appointing authority.
Students jump to Section 11(6) without reading the clause.
Fix: First check the agreed procedure. Approach the Court only if it fails and the agreement gives no other means.
Naming the High Court for every Section 11 application.
Section 11(12) is overlooked.
Fix: Supreme Court for international commercial arbitration, High Court for other arbitration.

Worked examples

Example 1

Alpha Ltd, Mumbai, and Beta Ltd, Chennai, have a contract with a clause: "Disputes shall be settled by arbitration under the rules of an institution X, which shall appoint the sole arbitrator." A dispute arises. Is this institutional or ad hoc arbitration, and do X's rules bind the parties?

Show the solution

The clause names an institution to administer the case and appoint the arbitrator, so it is institutional arbitration.
Section 2(1)(a) recognises arbitration whether or not administered by a permanent arbitral institution.
Section 2(8): an agreement of the parties includes any arbitration rules referred to in it. So X's rules form part of the agreement.
Section 11(2) lets the parties agree the appointment procedure, so X may appoint the arbitrator.

Answer: It is institutional arbitration. X's rules bind the parties because they are part of their agreement under Section 2(8), and X appoints the sole arbitrator under the agreed procedure.

Example 2

In the facts above, X fails to appoint the arbitrator. The clause gives no other means. Both parties are Indian companies. Where can Alpha Ltd go?

Show the solution

Section 11(6)(c): a person, including an institution, has failed to perform a function under the agreed procedure.
Alpha may request the Court, or its designated person or institution, to take the necessary measure, as the agreement gives no other means.
The arbitration is not international commercial, as both parties are Indian companies. Under Section 11(12)(b) the Court is the High Court within whose limits the principal Civil Court is situated.
Under Section 11(6A), the Court confines itself to examining the existence of an arbitration agreement.
Under Section 11(8), it must seek the arbitrator's written disclosure under Section 12(1) before appointing. Section 11(13) says an endeavour shall be made to dispose of the application within sixty days from service of notice on the opposite party.

Answer: Alpha Ltd can apply to the High Court under Section 11(6) read with Section 11(12)(b). The Court examines only the existence of the arbitration agreement, and the High Court or its designate appoints the arbitrator.

Exam tips

Always contrast ad hoc and institutional arbitration in two or three points: administration, rules, appointment and cost.
Cite Sections 2(1)(a), 2(6), 2(8) and 11 with their exact content; examiners reward precise provisions.
When writing about the Arbitration Council of India, state clearly that its provisions were not brought into force.
In case-based questions, read the clause first. It decides whether the Court is needed at all.
Add a drafting point: name the institution, its rules, the seat and the number of arbitrators in the clause.

Practice questions from Arbitration: Introduction, Agreements and its Institutions

Arbitral Institutions and Arbitration Council of India: frequently asked questions

What is the difference between institutional and ad hoc arbitration?

In institutional arbitration, a named institution administers the case under its rules and often appoints the arbitrators. In ad hoc arbitration the parties and tribunal manage the procedure themselves. The Act permits both under Section 2(1)(a).

Is the Arbitration Council of India functioning?

No. Its provisions were introduced by the 2019 amendment but were not brought into force. Write it as a proposed body meant to grade institutions and accredit arbitrators.

Can parties authorise an institution to decide procedural issues?

Yes. Under Section 2(6), where the Act leaves parties free to decide an issue, they can authorise any person or institution to decide it. Section 28 on the law applicable to the substance of the dispute is excluded.

Which institutions should I know for the exam?

Know the Indian Council of Arbitration, the ICC, the LCIA and the SIAC, and be able to say what an institution does. Focus on functions and the legal provisions rather than memorising rule details.