The Supreme Court of India has reaffirmed that unilateral appointment of arbitrators by one party is invalid under the Arbitration and Conciliation Act, 1996. This follows the recent ruling in Jaipur Zila Dugdh Utpadak Sahkari Sangh Ltd. v. Ajay Sales & Suppliers, emphasizing that arbitration must be fair, impartial, and free from bias.
🔹 Key Takeaway: If an agreement allows only one party to appoint an arbitrator, such a clause is likely unenforceable. This strengthens India’s arbitration landscape, ensuring neutrality in dispute resolution.
🔹 What it Means for Businesses: Contracts must be reviewed to ensure compliance with this ruling. Any arbitration clause that grants unilateral appointment rights should be reconsidered.
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