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Aug 163 min read

What Are The Areas Where Arbitration Cannot Be Applied?

One Type Of Alternative Dispute Resolution (Adr) Is Arbitration. A Process For Resolving Conflicts Involves Using A Third Party To Resolve The Contentious Issue Without Resorting To The Legal System. It Saves Money, Saves Time, And Lightens The Load On The Courts. The Earliest Possible Administration Of Justice Is Through Arbitration. These Days, An Arbitration Clause Is Included In A Contract Under Section 7 Of The Indian Arbitration And Conciliation Act 1996, Allowing The Parties To Decide Whether To Employ Arbitration If A Disagreement Occurs Shortly.

Domains In India In Which Arbitration Is Not Applicable   


  • Criminal Matters: Criminal Matters Are Not Subject To Arbitration. Arbitration Cannot Be Used To Settle Criminal Issues Under The Indian Legal System. The Indian Penal Code And Other Criminal Statutes Do Not Allow For The Arbitration Of Criminal Issues; Instead, Criminal Problems Remain The Sole Purview Of The Criminal Courts.

  • Arbitration Cannot Be Used To Settle Matrimonial Problems, Such As Those Involving Child Custody, Alimony, And Divorce. These Matters Are Under The Purview Of Family Courts Or Other Appropriate Judicial Bodies And Are Regulated By Particular Family Laws In India. Therefore, They Are Not Eligible To Be Sent To Arbitration.

  • Bankruptcy And Insolvency: Arbitration Is Not Permitted As A Means Of Settling Such Disputes Under The Insolvency And Bankruptcy Code, 2016, Which Regulates Insolvency And Bankruptcy Procedures In India. The Code Establishes The Debt Recovery Tribunal (Drt) For Individual And Partnership Firm Insolvency And The National Company Law Tribunal (Nclt) For Corporate Insolvency As Specialized Adjudicatory Bodies.

  • Topics Affecting Public Policy: Topics That Go Against Public Policy Are Not Subject To Arbitration. If A Dispute Is Deemed To Be Against Indian Public Policy, The Indian Arbitration And Conciliation Act, 1996, Expressly Prohibits Arbitration. Conflicts Involving Illegal Activity, Fraud, Corruption, And Other Issues Judged To Be Contrary To The Public Interest Fall Under This Category.

  • Certain Claims Are Recognized By The Indian Legal System As Non-Arbitrable, Which Means That Arbitration Cannot Be Used To Resolve Them. These Include Issues About Public Interest, Guardianship And Custody Of Minors, And Tenancy And Eviction. Through Several Rulings, The Indian Judiciary Has Determined Which Types Of Disputes Fall Outside Of Arbitration And Need To Be Decided By Normal Courts.   


The Increasing Popularity Of Arbitration As A Conflict Resolution Method Has Led The Legal Authorities To Recognize That, To Guarantee The Proper Operation And Application Of The Laws Of The Land, The Governance Of Law Must Adhere To A Methodical Approach And Well-Structured Changes. Due To The Commercialization Of Business And Industry, It Is Crucial To Handle Private And Civil Lawsuits With Flexibility While Keeping The Contractual And Statutory Terms Of An Agreement Balanced. There Is No One-Size-Fits-All Answer To Any Problem; Instead, Each Element And Provision Of The Case Needs To Be Carefully Examined To Be Tailored To The Arbitrary Legal Requirements.


The Current Strategy Taken By Legal Interpreters To Ensure The Prompt Resolution Of Disputes And The Smooth Operation Of The Aforementioned Tribunals And Courts Is "Modern Times Bring Modern Solutions." Over Time, Changes In Culture And The Judiciary Have Been Sparked By The Arbitral Laws' Uniformity In The Functioning Of The Courts. Certain Rulings Have Deviated From The Letter Or The Spirit Of The Law, But The Courts Have Specifically Addressed These Issues, And Alternative Dispute Resolution Procedures Are Still Widely Used.


In Conclusion, Arbitration Is A Commonly Used Process In India For Settling Business Disputes, But There Are Some Situations In Which It Cannot Be Used. The Main Goals Of These Restrictions Are To Protect The Rule Of Law, Safeguard Access To Justice, And Preserve The Public Interest. For Parties Involved In Business Transactions In India To Choose The Best Dispute Resolution Procedures, They Must Be Aware Of The Limits Of Arbitration.


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