Arbitration, Mediation and Conciliation · Emerging Aspects: Fast Track and Virtual Arbitration

Virtual and Online Arbitration under the Arbitration Act

Updated 11 October 2026 · Fact-checked

Virtual or online arbitration means conducting arbitral proceedings by video conferencing and electronic means. The 1996 Act does not use the word 'virtual'. You rely on parties' freedom to agree, section 7(4)(b) on electronic agreements, section 24 on hearings, and fairness duties. Answer by stating the provision, applying it to the facts, and concluding.

Understand Virtual and Online Arbitration

Virtual arbitration is ordinary arbitration with the tools changed. Pleadings are filed by email or a portal, hearings run on video platforms, and documents are shared digitally. The legal nature of the proceeding does not change. It is still an arbitration under the Act, with the same tribunal duties and the same award.

The Act supports this in three places. Section 7(4)(b) says an arbitration agreement is in writing if contained in an exchange of letters, telex, telegrams or other means of telecommunication, including communication through electronic means, which provide a record of the agreement. So an agreement concluded by email can be valid. Section 24(1) says that, unless the parties agree otherwise, the tribunal decides whether to hold oral hearings or proceed on documents and materials. The Act does not say where or how a hearing must be physically held, so a tribunal may use video, subject to fairness and party agreement.

The fairness rules still apply. Section 24(2) requires sufficient advance notice of any hearing or meeting. Section 24(3) requires that all statements, documents, applications and any expert report or evidentiary document the tribunal may rely on be communicated to the other party. In a virtual setting this means everything uploaded or emailed must reach both sides, and the tribunal should not rely on material one party never saw.

The proviso to section 24(1) says the tribunal shall hold oral hearings at an appropriate stage on a party's request, unless the parties agreed that no oral hearing shall be held. A virtual hearing can be an oral hearing, but a party may object if the format makes a fair presentation difficult. The tribunal should then weigh the objection. Hearings should also be held, as far as possible, on a day-to-day basis without adjournments unless sufficient cause is shown, and virtual hearings make this easier.

Challenges include connectivity failure, witness coaching off-camera, authenticity of digital documents, data security and confidentiality, and different time zones. Good practice is to agree a protocol in advance: platform, test sessions, document bundles, witness rules and a fallback plan. Note also that the seat is a legal concept. Holding hearings online does not move the seat, and if the place is in India, Part I applies under section 2(2).

Key rules to remember

Arbitration agreement in electronic form: Section 7(3) and 7(4)(b): must be in writing; exchange of communication through electronic means that provides a record is enough; Email exchange can form a valid written agreement if it records the agreement.
Mode of hearing: Section 24(1): tribunal decides oral hearing or documents-only, unless parties agree otherwise; Proviso: oral hearing on a party's request unless parties agreed none shall be held.
Notice of hearings: Section 24(2): sufficient advance notice of any hearing and of meetings for inspection; Applies to virtual hearings and meeting links too.
Communication of material: Section 24(3): all statements, documents, applications and expert reports relied on go to the other party; Core natural justice rule for e-filing and shared folders.
Day-to-day hearings: Second proviso to section 24(1): as far as possible day-to-day, no adjournment without sufficient cause, costs possible; The tribunal may impose costs including exemplary costs.
Applicability of Part I: Section 2(2): Part I applies where the place of arbitration is in India; Virtual hearing does not change the place of arbitration.

How to solve Virtual and Online Arbitration questions

Use this method for any case question on online or virtual arbitration.

1Identify the issue: validity of the e-agreement, mode of hearing, fairness, evidence, or seat.
2State the rule: section 7(4)(b) for agreement, section 24 for hearings, section 2(2) for applicability.
3Check what the parties agreed. Party autonomy comes first, then the tribunal's discretion.
4Apply the facts: notice given, documents shared, party objection, technical failure.
5Test fairness: sufficient notice, equal opportunity and communication of all material to both sides.
6Note practical safeguards: a protocol, test run, recording, secure platform and fallback.
7Conclude clearly: valid or invalid, permitted or not, with the reason.

Quickest way: Four-point virtual arbitration check

When to use it: When time is short and the question describes an online hearing or e-filing dispute.

Agreement: written, electronic record suffices (section 7(4)(b)).
Mode: parties' choice, else tribunal decides (section 24(1)).
Fairness: notice and sharing of all documents (section 24(2) and (3)).
Seat: unchanged by online hearing (section 2(2)); then conclude.

Common mistakes in Virtual and Online Arbitration

Saying the Act expressly provides for virtual hearings.
Students link section 24 to video conferencing from practice.
Fix: Say the Act is silent on the medium. The tribunal's power to decide the mode of hearing, subject to party agreement, supports it.
Treating an email exchange as never valid for an arbitration agreement.
Students remember the 'signed document' limb only.
Fix: Cite section 7(4)(b): electronic communication providing a record of the agreement is in writing.
Assuming the seat moves to where the parties log in from.
Confusing venue with seat.
Fix: Say a virtual hearing does not change the place of arbitration; section 2(2) turns on the place.
Ignoring a party's request for an oral hearing.
Students think documents-only is always allowed.
Fix: State the proviso: oral hearing must be held on request, unless the parties agreed none.
Forgetting to share tribunal-relied documents with both sides.
E-filing feels informal.
Fix: Quote section 24(3) and apply it to every upload, expert report and evidentiary document.

Worked examples

Example 1

Mehta Textiles Ltd, Surat, and Kaveri Dyes Pvt Ltd, Chennai, agreed by email exchange that disputes would go to arbitration. No document was signed. A dispute arose and Kaveri argues there is no valid arbitration agreement. Advise.

Show the solution

Issue: whether an unsigned email exchange is a written arbitration agreement.
Rule: section 7(3) requires writing. Section 7(4)(b) treats an exchange of communication through electronic means, which provides a record of the agreement, as writing.
Application: the emails record the agreement to arbitrate, so a signature on a single document is not required.
Check: the emails must clearly show consent to arbitrate defined disputes (section 7(1)).
Conclusion: the agreement is in writing and can be valid.

Answer: Kaveri's objection fails if the emails record a clear agreement to arbitrate. Section 7(4)(b) accepts electronic exchanges as writing, so the arbitration can proceed.

Example 2

In an arbitration seated in Mumbai, the tribunal fixes hearings by video conference. Respondent Rao Infra objects, saying it wants a physical hearing, and the parties have not agreed on the mode. The tribunal also relies on an expert report emailed only by the claimant. Examine the position.

Show the solution

Issue 1: mode of hearing. Under section 24(1) the tribunal decides, unless parties agree otherwise, and no agreement exists here.
The Act does not bar video hearings, so the tribunal may use them. It should weigh Rao's reasons and ensure a fair chance to present its case.
The proviso requires an oral hearing on request. A video hearing can be oral, so this is met.
Issue 2: the expert report. Section 24(3) requires any expert report or evidentiary document the tribunal may rely on to be communicated to the parties.
Application: Rao did not receive the report, so the tribunal cannot rely on it until it is shared and Rao can respond.
Seat: it remains Mumbai, and Part I applies under section 2(2).

Answer: The tribunal may hold the hearing by video conference, since the parties have not agreed otherwise, but it must ensure fairness. It must send the expert report to Rao Infra before relying on it, as section 24(3) requires.

Exam tips

Quote section numbers for the electronic agreement (7(4)(b)) and hearings (24); examiners reward precise provisions.
Structure answers as provision, analysis of facts, conclusion, and add a practical protocol point.
For 'advantages and challenges' questions, list four of each with a one-line reason and a safeguard.
Always state that the seat and place are legal concepts unaffected by online conduct.

Practice questions from Emerging Aspects: Fast Track and Virtual Arbitration

Virtual and Online Arbitration: frequently asked questions

Does the Arbitration and Conciliation Act, 1996 allow online hearings?

The Act does not mention video hearings by name. Section 24(1) lets the tribunal decide the mode of hearing unless the parties agree otherwise. Tribunals therefore use video conferencing, subject to fairness and party agreement.

Is an arbitration agreement made by email valid?

Yes, if it is in writing as section 7(4)(b) defines. An exchange of communication through electronic means that provides a record of the agreement satisfies the writing requirement.

Does a virtual hearing change the seat of arbitration?

No. The seat or place is a legal designation. Where the place of arbitration is in India, Part I applies under section 2(2), whatever the physical locations of the participants.

What are the main challenges of virtual arbitration?

The main ones are technical failure, witness integrity, authenticity of electronic evidence, data security and time zones. A prior procedural protocol and a fallback plan reduce these risks.