Celebrating arbitration weeks pointless if courts and policies undermine it: Justice Bhuyan

Supreme Court judge Justice Ujjal Bhuyan has cautioned that celebrating arbitration weeks and conferences is pointless if court verdicts and government policies continue to weaken the arbitration framework in India. Delivering a keynote address at The Law Forum's discussion on arbitration reforms, he pointed to specific judicial and policy decisions that have set back the cause of alternative dispute resolution.

No point in festivities if framework is broken

Justice Bhuyan questioned the value of hosting elaborate arbitration weeks and industry gatherings when the fundamental legal and policy environment remains hostile to the process. He argued that such events lose their purpose unless accompanied by concrete steps to strengthen arbitration.

“It is pointless to celebrate arbitration weeks if court verdicts and policies undermine the very foundation of arbitration,” he said.

Delhi Metro judgment caused 'extensive damage'

The judge specifically called out the Supreme Court's judgment in the Delhi Metro case, describing it as having caused extensive damage to arbitration in India. He did not elaborate on the details of the case but made clear that the ruling has had a chilling effect on the arbitration ecosystem.

Legal experts have previously noted that the Delhi Metro judgment dealt with issues of interference by courts in arbitral awards. Justice Bhuyan’s remarks suggest that the top court itself needs to be cautious about the precedents it sets in arbitration matters.

Finance ministry policy called 'regressive'

Beyond the judiciary, Justice Bhuyan also flagged a policy decision by the Union finance ministry as a major setback. He termed the move 'regressive', indicating that it has undone some of the progress made in promoting India as an arbitration-friendly destination.

Sources have indicated that the finance ministry’s policy relates to the government's approach to arbitration clauses in contracts and the appointment of arbitrators. The judge did not provide specifics but his criticism was sharp and direct.

Growing concern over judicial overreach

Justice Bhuyan’s address comes at a time when stakeholders in the arbitration community have been raising concerns about increasing judicial intervention in arbitral proceedings. Many have argued that India's reputation as a seat for international arbitration is at stake if courts do not respect the finality of awards.

The judge’s remarks are significant because they come from within the Supreme Court itself. He did not spare his own institution, pointing out that the highest court's judgments can sometimes do more harm than good to the arbitration regime.

Officials have not yet confirmed whether any review of the Delhi Metro judgment or the finance ministry policy is being considered. The government has not issued a formal response to Justice Bhuyan's critique.

The Law Forum’s discussion on arbitration reforms is expected to continue over the coming days, with industry bodies and legal experts likely to weigh in on the issues raised by the Supreme Court judge. The question now is whether the government and the judiciary will take note and act to reverse what Justice Bhuyan described as a worrying trend.