Conference Report -IBA India Litigation Symposium 2020 - Litigation Committee newsletter article, April 2020
Back to Litigation Committee publications
Taking reforms to the last mile
8 February 2020, New Delhi
Neerav Merchant
Majmudar & Partners, Mumbai
The India Litigation Symposium in New Delhi was organised by the Asia Pacific Forum and supported by the Litigation Committee and Mediation Committee. The event took place on 8 February 2020, and was attended by distinguished lawyers, judges, and arbitrators. Interesting topics were discussed relating to dispute resolution and arbitration, insolvency law, art of case management, and mediation in India.
Litigating in India
India follows a three-tier system for litigation with Subordinate Courts at the district level, High Courts at the state level, and the central Supreme Court. Additionally, there are appellate and specialised tribunals for specific matters, such as the National Company Law Tribunal, the Debt Recovery Tribunal, and the Income Tax Tribunal. In India, litigators of foreign origin should be cognisant of these tribunals and layers of dispute resolution mechanisms, so as to make better use of the judicial forums and remedies available. Moreover, foreign litigators should be aware that trials before India’s courts takes longer, compared to seeking interim or restraining relief. Therefore, they should explore the possibility of mediation, followed by a binding arbitration.
After having risen as a premier foreign investment destination in the South Asia, India has been pushing remarkable legal measures to protect investors’ commercial interests. Over the years arbitration in India has become a preferred mode of alternate dispute resolution, with tighter timelines and reduced judicial intervention. Through the 2015 Arbitration and Conciliation (Amendment) Act, India instructed arbitrators to adjudicate disputes within a maximum of 18 months, which is much more aggressive than other institutions’ rules.
In 2016, India introduced the Insolvency and Bankruptcy Code (IBC) which aims at consolidating various laws relating to insolvency and bankruptcy. The IBC appoints an insolvency resolution professional to coordinate with creditors to restructure the repayment schedule or to sell the assets of the stressed entity. This is a significant measure as previously, banks were not able to recover bad loans from these entities. The IBC restricts the timeline to a maximum of 330 days, which, according to the World Bank’s 2019 Doing Business survey, is much longer than the global average.
On a similar note, in 2015 India introduced the Commercial Courts Act (CCA), which has been a welcome proposal to fast track commercial disputes in courts. Through the CCA separate courts are set up at District and High Court level, mainly, to provide a streamlined process for commercial litigation. The CCA also mandates the commercial courts to have case management hearings, and gives the Commercial Court the power to set timelines, structure proceedings and hear arguments and rebuttals in an accelerated manner. However, the CCA requires more time and robust implementation to become effective.
Mediation is another mainstream option in India, and usually precedes any arbitration or litigation proceedings in a dispute. As India is a signatory to the Singapore Mediation Convention 2019, it must take steps to make mediation a popular mechanism for resolving disputes.
There has been an appreciable rise in cross-border transactions in recent years and legislation is developing further to keep up with the market. One significant issue faced by foreign investors in India has been multiple laws and compliances at state and federal level, which will be resolved in time.
Back to Litigation Committee publications