The Arbitration and Conciliation Act 1996: Where It Came From and How It Is Built

Two consequences follow, and both are examinable.

The Act is not original drafting. Large parts of Part I are the Model Law with the numbering changed, which is why its language sometimes reads oddly in an Indian statute. It is also why decisions of other Model Law countries are sometimes cited here.

India went further than the Model Law asked. The Model Law is about international commercial arbitration. India applied the same scheme to domestic arbitration as well, and added a complete code for conciliation in Part III. So the Act does more than the preamble's recitals strictly require.

How the Act is laid out

Part I itself divides into ten chapters, and knowing them makes the Act navigable: general provisions (3 to 6), the arbitration agreement (7 to 9), composition of the tribunal (10 to 15), jurisdiction (16 and 17), conduct of proceedings (18 to 27), the award and termination (28 to 33), recourse against an award (34), finality and enforcement (35 and 36), appeals (37), and miscellaneous (38 to 43).

There are eight Schedules, added or amended by the later amendment Acts, and chapter 450 works through them.

Dates, and the three amendment Acts

Assent: 16 August 1996. Commencement: 22 August 1996, by notification G.S.R. 375(E) of that date.

The Act was preceded by three Ordinances in 1996, which is why the Act's own repeal provisions in section 85 mention them. An Ordinance is temporary legislation made when Parliament is not sitting.

Three amendment Acts then rebuilt substantial parts of it, and a student will meet all three repeatedly in this Module.

The Arbitration and Conciliation (Amendment) Act 2015, Act 3 of 2016, largely with effect from 23 October 2015. The most far-reaching of the three. It added the Fifth, Sixth and Seventh Schedules on arbitrator independence; inserted section 29A's time limit and section 29B's fast track; rewrote section 34's public policy ground and added the Explanations; ended the automatic stay on enforcement in section 36; strengthened section 17; and added the costs regime in section 31A.

The Arbitration and Conciliation (Amendment) Act 2019, Act 33 of 2019. Inserted Part IA, the Arbitration Council of India, brought into force on 12 October 2023; amended section 11 to route appointments through arbitral institutions; rewrote section 29A's time limit to run from the completion of pleadings; inserted section 42A on confidentiality and 42B on good faith; and inserted the Eighth Schedule and section 87.

The Arbitration and Conciliation (Amendment) Act 2021, Act 3 of 2021. Added a proviso to section 36(3) for an unconditional stay where the arbitration agreement or the award is induced by fraud or corruption, and omitted the Eighth Schedule.

The trap: India Code now says two of those Acts were repealed

Look up the amendment Acts today and India Code lists them as:

The Arbitration and Conciliation (Amendment) Act, 2015 (Rep., Act 37 of 2025)

The Arbitration and Conciliation (Amendment) Act, 2021 (Rep., Act 37 of 2025)

That does not undo the amendments, and a student who thinks it does will state the law as it stood in 2014.

Act 37 of 2025 is the Repealing and Amending Act 2025, assented to on 20 December 2025, which repealed seventy-one spent enactments. An amending Act is spent once it has done its work: the words it inserted are now part of the principal Act and stay there. Section 4 of that Act says so expressly, saving the validity, effect and consequences of anything already done, and providing that the repeal shall not revive or restore anything not now existing or in force.

The consolidated print of the Arbitration Act settles it on its face. It is headed as the text as on the 1st June, 2026, six months after that repeal, and it still carries every 2015, 2019 and 2021 amendment in its text and its footnotes.

Section 1: title, extent and commencement

Section 1(1): the Act may be called the Arbitration and Conciliation Act, 1996.

Section 1(2): it extends to the whole of India. A proviso and Explanation that had applied the Act differently to Jammu and Kashmir were omitted in 2020, by the Jammu and Kashmir Reorganisation (Adaptation of Central Laws) Order 2020 and the corresponding Ladakh Order.

Section 1(3): it comes into force on such date as the Central Government appoints, which was 22 August 1996.

One State amendment is worth knowing because it belongs to this subject twice over. For Jammu and Kashmir and Ladakh, sections 8A and 8B have been inserted, allowing a court seized of a petition under section 9 or 11, or under section 34 or an appeal under section 37, to refer the parties with their consent to mediation or conciliation. A mediated settlement so recorded has the same status and effect as an arbitral award and is enforceable under section 36. It is the clearest statutory bridge in the Act between arbitration and the methods Module III teaches.

A worked example

Two companies sign a supply contract in Pune in 2026 containing a clause that disputes shall be referred to a sole arbitrator sitting in Mumbai.

Which statute governs? The Arbitration and Conciliation Act 1996. The 1940 Act was repealed by section 85 and has nothing to say.

Which Part? Part I, because section 2(2) applies Part I where the place of arbitration is in India.

Is it international commercial arbitration? Only if one of the parties answers the description in section 2(1)(f), which chapter 210 works through. Two Indian companies do not, so this is a domestic arbitration and the award will be a domestic award under section 2(7).

Which version of the Act? The Act as amended in 2015, 2019 and 2021. The catalogue entry saying the amendment Acts were repealed in 2025 changes nothing.

Where will the reader meet each amendment? Arbitrator independence and the Seventh Schedule in chapter 280; the twelve-month limit in chapter 360; the public policy ground in chapter 400; the end of the automatic stay in chapter 410.

What beginners get wrong

The 1996 Act did not only replace the 1940 Act. It replaced three statutes: the 1940 Act, the 1937 Act and the 1961 Act.

The Model Law governs international commercial arbitration; India applied its scheme to domestic arbitration too. Saying the Act "is" the Model Law is too strong.

The preamble is part of the Act and can be used to construe it, but it is not an operative provision and confers no rights.

There are three amendment Acts, not one, and they pull in different directions: 2019 partly undid what 2015 did, and 2021 partly undid what 2019 did. Chapter 410 works through the clearest instance.

The repeal of the amendment Acts in 2025 is housekeeping. Do not report it as a change in arbitration law.

Quick revision

• Act 26 of 1996, assented 16 August 1996, in force 22 August 1996 by G.S.R. 375(E).
• Repealed the Arbitration Act 1940, the Arbitration (Protocol and Convention) Act 1937 and the Foreign Awards (Recognition and Enforcement) Act 1961.
• Built on the UNCITRAL Model Law on International Commercial Arbitration 1985 and the UNCITRAL Conciliation Rules 1980, both recited in the preamble.
• Part I arbitration in India (ss.2 to 43); Part IA Arbitration Council (43A to 43M); Part II foreign awards (44 to 60); Part III conciliation (61 to 81); Part IV supplementary (82 to 87). Eight Schedules.
• Amended by Act 3 of 2016 (the 2015 Act, w.e.f. 23 October 2015), Act 33 of 2019 and Act 3 of 2021.
• The 2015 and 2021 amendment Acts were repealed as spent by the Repealing and Amending Act 2025; section 4 of that Act saves everything done, and the consolidated text of 1 June 2026 still carries every amendment.

Test yourself

1. Which three statutes did the 1996 Act replace, and where does it say so? The Arbitration Act 1940, the Arbitration (Protocol and Convention) Act 1937 and the Foreign Awards (Recognition and Enforcement) Act 1961, repealed by sections 85 and 86.

2. What does the preamble recite, and why does it matter? That UNCITRAL adopted the Model Law on International Commercial Arbitration in 1985 and the Conciliation Rules in 1980, that the General Assembly recommended both, and that they contribute to a unified legal framework for the fair and efficient settlement of international commercial disputes. It matters because it explains why Part I reads as it does and licenses reference to the Model Law in construing it.

3. India Code shows the 2015 and 2021 amendment Acts as repealed. Are those amendments still law? Yes. They were repealed as spent by the Repealing and Amending Act 2025, whose section 4 saves everything already done and provides that the repeal does not revive anything not now in force. The words those Acts inserted are part of the principal Act, and the consolidated print of 1 June 2026 still carries them.

4. Name one change each of the three amendment Acts made. The 2015 Act inserted section 29A's time limit for the award (among much else); the 2019 Act inserted Part IA establishing the Arbitration Council of India; the 2021 Act omitted the Eighth Schedule and added the unconditional stay proviso to section 36(3).

5. Does the Act still apply differently in Jammu and Kashmir? Section 1(2) now extends the Act to the whole of India, the earlier proviso and Explanation having been omitted in 2020. A State amendment for Jammu and Kashmir and Ladakh does insert sections 8A and 8B, letting a court refer parties to mediation or conciliation with their consent at the section 9, 11, 34 or 37 stage.