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CS Executive · Economic, Commercial and Intellectual Property Laws · Law relating to Special Economic Zones

Two Developers in an SEZ have a civil dispute. No court has been designated for that SEZ under section 23(1). How is the dispute to be dealt with under the SEZ Act, 2005?

The dispute is referred to arbitration, and the arbitrator is appointed by the Central Government. Section 42 applies because no court has been designated for the Zone, and the Arbitration and Conciliation Act, 1996 governs the proceedings except as the SEZ Act provides otherwise.

  1. AIt must be referred to arbitration, with the arbitrator appointed by the Central GovernmentCorrect
  2. BIt must be referred to arbitration, with the arbitrator appointed by the State Government
  3. CIt may be tried only by the High Court of the State
  4. DIt stays unresolved until a court is designated

Explanation

Section 42 provides that where no court is designated, civil disputes among entrepreneurs or Developers, or between them, are referred to arbitration. Section 42(2) says the arbitrator is appointed by the Central Government, not the State Government.

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