Third Schedule to the Arbitration & Conciliation Act, 1996 ("1996 Act") is the Geneva Convention of on the Execution of Foreign Arbitral Awards. Article 3 to the III Schedule reads:
"If the party against whom the award has been made proves that, under the law governing the arbitration procedure, there is a ground, other than the grounds referred to in Article 1(a) and (c), and Article 2(b) and (c), entitling him to contest the validity of the award in a Court of Law, the Court may, if it thinks fit, either refuse recognition or enforcement of the award or adjourn the consideration thereof, giving such party a reasonable time within which to have the award annulled by the competent tribunal." (emphasis added)
Article 1 is quoted in its entirety at the end of this blog post. In the III Schedule, it is divided into Articles 1(1) and 1(2). Article 1(1) deals with arbitral awards which are recognisable and enforceable and Article 1(2) concerns the conditions for recognition and enforcement.
The text of the Geneva Convention does not seem to make this division. Article 1 of the text of the Conventions consists of two paragraphs as noted below:
"In the territories of any High Contracting Party to which the present Convention applies, an arbitral award made in pursuance of an agreement, whether relating to existing or future differences hereinafter called "a submission to arbitration") covered by the Protocol on Arbitration Clauses, opened at Geneva on September 24, 1923, shall be recognised as binding and shall be enforced......
To obtain such recognition or enforcement, it shall, further, be necessary..."
As would be apparent Article 1 of the Convention was not divided in two sub-articles. However, in the III Schedule this subdivision has resulted in a referencing error in Article 3- there is no Article 1(a) or (c)- there are only Articles 1(2)(a) and 1(2)(c).
The referencing error was not in the Arbitration (Protocol and Convention) Act, 1937. The Second Schedule to the 1937 Act did not divide Article 1 into two parts:
"Article I.-In the territories of any High Contracting Party to which the present Convention applies, an
arbitral award made in pursuance of an agreement,
whether relating to existing or future differences (hereinafter called " a submission to arbitration ") covered
by the Protocol on Arbitration Clauses opened at
Geneva on September 24th, 1923, shall be recognised
as binding and shall be enforced...
To obtain such recognition or enforcement, it shall,
further, be necessary..."
Hence, Article 3 to the Second Schedule to the 1937 Act did not contain this referencing error. On the other hand, III Schedule to the 1996 Act contains this referencing error in view of the division of Article 1 into two sub-Articles. The Arbitration and Conciliation (Amendment) Bill, 2024 does not seem to address this referencing error. Somehow, this error seems to have escaped the attention of everyone in the last thirty years. The division in Article 1 to the Third Schedule, not being a reflection of the Convention's text, should be removed in the upcoming amendments to the 1996 Act.
Article I of III Schedule to the 1996 Act:
"ARTICLE 1.—(1) In the territories of any High Contracting Party to which the present Convention applies, an arbitral award made in pursuance of an agreement whether relating to existing or future differences (hereinafter called “a submission to arbitration”) covered by the Protocol on Arbitration Clauses opened at Geneva on September 24th,1923, shall be recognised as binding and shall be enforced in accordance with the rules of the procedure of the territory where the award is relied upon, provided that the said award has been made in a territory of one of the High Contracting Parties to which the present Convention applies and between persons who are subject to the jurisdiction of one of the High Contracting Parties.
(2) To obtain such recognition or enforcement, it shall, further, be necessary:—
(a) that the award has been made in pursuance of a submission to arbitration which is valid under the law applicable thereto;
(b) that the subject-matter of the award is capable of settlement by arbitration under the law of the country in which the award is sought to be relied upon;
(c) that the award has been made by the Arbitral Tribunal provided for in the submission to arbitration or constituted in the manner agreed upon by the parties and in conformity with the law governing the arbitration procedure;
(d) that the award has become final in the country in which it has been made, in the sense that it will not be considered as such if it is open to opposition, appeal or pourvoi en cassation (in the countries where such forms of procedure exist) or if it is proved that any proceedings for the purpose of contesting the validity of the award are pending;
(e) that the recognition or enforcement of the award is not contrary to the public policy or to the principles of the law of the country in which it is sought to be relied upon."
1 comment:
Sharpen the Title
The current title is descriptive but a bit long. Consider a crisper version that highlights the anomaly:
“Misplaced References: Why Section 3 of the Third Schedule to the Arbitration Act, 1996 Needs Correction”
2. Structure for Clarity
The flow is logical, but you can improve readability with:
• A short abstract or summary at the beginning (1–2 sentences stating the error and why it matters).
• Headings to break the text:
o The Error in the Third Schedule
o How the 1937 Act Got It Right
o Why the Error Matters
o The 2024 Amendment Bill – A Missed Opportunity
o A Simple Fix
3. Make the Error Immediately Visible
Consider adding a comparison table or side by side text boxes showing:
Geneva Convention (original) Third Schedule, 1996 Act
Article 1 (single paragraph) … Article 1(1) …
Article 1(2)(a)–(e)
Article 3 refers to “Article 1(a) and (c)” and “Article 2(b) and (c)” Same wording – but those references do not exist in the schedule’s own structure.
This makes the error instantly comprehensible.
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4. Deepen the Analysis
• Explain why the division occurred. Was it a formatting choice by the Indian draftsman? Did they try to modernise the layout without adjusting cross references?
• Discuss judicial treatment. Has any court (Supreme Court or High Court) ever commented on this inconsistency? If not, note that it has escaped judicial notice – which underscores how minor yet persistent it is.
• Highlight practical consequences. While the error is technical, could it ever lead to a procedural argument? For example, a party might claim that Article 3 is unworkable because the referenced clauses don’t exist. Even if unlikely, it adds weight to your call for amendment.
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5. Strengthen the Recommendation
You mention the 2024 Bill does not address the error. Suggest a specific textual amendment – for instance:
“Article 3 of the Third Schedule should be amended to substitute ‘Article 1(a) and (c)’ with ‘Article 1(2)(a) and (c)’, and ‘Article 2(b) and (c)’ with ‘Article 2(b) and (c)’ (which are correctly numbered in the schedule).”
Alternatively, advocate for restoring the original undivided format of Article 1 to mirror the Geneva Convention, as in the 1937 Act.
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6. Language and Tone
The tone is appropriate for a legal blog – formal yet accessible. A few minor tweaks:
• Avoid overusing “Hence” and “On the other hand” in consecutive sentences.
• Break long paragraphs (e.g., the block quotation of Article 1 in the Third Schedule is quite long; consider formatting it as a block quote and summarising the relevant clauses in the text).
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7. Add a Concluding Call
End with a clear statement that this is an easy legislative fix and urge the Ministry of Law or the Law Commission to include it in the next amendment round. A concluding sentence like:
“Thirty years is long enough for a simple drafting error to persist. The next amendment to the Arbitration Act should correct this oversight and align the Third Schedule with both the Geneva Convention and the original 1937 Act.”
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Final Assessment
Your article correctly identifies a genuine drafting anomaly. With the suggested structural and analytical enhancements, it can become a compelling piece that highlights a neglected technical flaw in India’s arbitration framework, one that merits correction in the next legislative update.
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