How arbitration is beneficial?

Author- admin
Date:May 27, 2022

How arbitration is beneficial?

We take example of filing a suit and will see how arbitration is beneficial

Suit in District Court / High courtArbitration
Court fee is payable for filing suit (Ranging from  1 % to 7 % of valuation)Initially, no fee is payable. On Award Rs. 100 per Rs. 1 Lac stamp duty is payable which is much less than the court fee payable
Jurisdiction of the court is fixed as per the provisions of Civil Procedure CodeParties can agree the seat of arbitration
Normally it leads to a lengthy trial, and this is time taking. In metro cities, it takes average 2-3 years to conclude the case.  Normally the procedure is summary. On average arbitration proceedings can conclude in 4- 6 months.
Normally simple interest is awarded in money suitFixed interest as per the provisions of Arbitration & Conciliation Act, 1996 is awarded which is higher than the court award.
Execution of the decree or judgement can be filed in the same court which passed the decree.   In case Defendant is residing outside the jurisdiction of court, it is time consuming and execution takes time.Execution can be directly filed where Defendant resides.
Judgement or decree is normally challenged and it takes time to decide.Objection against award can be filed on narrow grounds available as per the provisions of section 34 of Arbitration & Conciliation Act, 1996

There are also other benefits of the arbitration proceedings.