Competence of arbitral tribunal to rule on its jurisdiction
Section 16 of the Arbitration and Conciliation Act, 1996 deals with competence of arbitral tribunal to rule on its jurisdiction. The arbitral tribunal may rule on its own jurisdiction, including ruling on any objections with respect to the existence or validity of the arbitration agreement, and for that purpose,— (a) an arbitration clause which forms part of a contract shall be treated as an agreement independent of the other The Act came into force on 22 Aug 1996.
(1) The arbitral tribunal may rule on its own jurisdiction, including ruling on any objections with respect to the existence or validity of the arbitration agreement, and for that purpose,—
(a) an arbitration clause which forms part of a contract shall be treated as an agreement independent of the other terms of the contract; and
(b) a decision by the arbitral tribunal that the contract is null and void shall not entail ipso jure the invalidity of the arbitration clause.
(2) A plea that the arbitral tribunal does not have jurisdiction shall be raised not later than the submission of the statement of defence; however, a party shall not be precluded from raising such a plea merely because that he has appointed, or participated in the appointment of, an arbitrator.
(3) A plea that the arbitral tribunal is exceeding the scope of its authority shall be raised as soon as the matter alleged to be beyond the scope of its authority is raised during the arbitral proceedings.
(4) The arbitral tribunal may, in either of the cases referred to in sub-section (2) or sub-section (3), admit a later plea if it considers the delay justified.
(5) The arbitral tribunal shall decide on a plea referred to in sub-section (2) or sub-section (3) and, where the arbitral tribunal takes a decision rejecting the plea, continue with the arbitral proceedings and make an arbitral award.
(6) A party aggrieved by such an arbitral award may make an application for setting aside such an arbitral award in accordance with section 34.
Section 16, The Arbitration and Conciliation Act, 1996 (Act 26 of 1996).
Cross-references
Extracted from the operative text of the enactments themselves. Every destination below exists in our corpus.
This section refers to
Referred to by 1
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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Indian Farmers Fertilizer Cooperative Limited v. Bhadra Products
Court's Decision & Legal Precedent
Judgment of Main Case order-5.pdf 2018-01-23. CA 824/2018. R.F. Nariman. DATE-CHECK false positive (2006–07 contract dates in the facts); body is the named reportable. Isolates Arbitration Act 16: kompetenz-kompetenz is the tribunal’s power to rule on the existence or validity of the arbitration agreement; a ruling that the claim is barred by limitation is an interim award under ss.2(c)/31(6) challengeable under s.34, not a s.16 jurisdictional ruling. Map arbitration-act 16 cited only. Do not pad arbitration-act 34 (already filled).
On this section: Arbitration Act 16 kompetenz-kompetenz is confined to the existence or validity of the arbitration agreement; a limitation ruling is an interim award under ss.2(c)/31(6), not a s.16 jurisdictional finding (IFFCO / Bhadra Products). Do not pad s.34 (already filled).
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Narayan Prasad Lohia vs Nikunj Kumar Lohia
Court's Decision & Legal Precedent
The prohibition on even number of arbitrators under Section 10 of the Arbitration and Conciliation Act 1996 is a derogable provision. When read conjointly with Section 16, which permits parties to challenge tribunal composition before the arbitral tribunal itself (not later than submission of statement of defence), the requirement of odd number of arbitrators becomes derogable. A party who knowingly agrees to an even number of arbitrators and participates in the arbitration proceedings without raising an objection to the tribunal composition within the prescribed timeline under Section 16(2) is deemed to have waived the right to object under Section 4. Consequently, an arbitral award made by two arbitrators cannot be set aside merely on the ground that it violates Section 10 if the composition was in accordance with the agreement of the parties and no objection was raised before the arbitral tribunal. Section 34(2)(a)(v) permits setting aside an award on grounds of improper composition only if the composition was not in accordance with the agreement of the parties.
On this section: Critically applied to establish that parties can challenge tribunal composition before the arbitral tribunal itself, not later than submission of statement of defence. The Court held that Section 16 enables challenge to composition and that failure to raise such challenge results in deemed waiver under Section 4.
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Kinnari Mullick vs Ghanshyam Das Damani
Court's Decision & Legal Precedent
The power vested in courts under Section 34(4) of the Arbitration and Conciliation Act, 1996 is limited to adjourning proceedings before setting aside an arbitral award upon written request by a party to the arbitration, to allow the arbitral tribunal an opportunity to resume proceedings or take curative action. Courts possess no power to remand or relegate matters to the arbitral tribunal after the award has been set aside, and any such remand cannot be ordered suo moto.
On this section: Provision under which appellants challenged composition of arbitral tribunal and jurisdiction to proceed as Sole Arbitrator.
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A. Ayyasamy vs A. Paramasivam
Court's Decision & Legal Precedent
Mere allegations of fraud, simpliciter, are insufficient to exclude a dispute from arbitration. A court may refuse to refer a dispute to arbitration on the ground of fraud only where it finds that there are very serious allegations of fraud which: (1) make a virtual case of criminal offence, or (2) are so complicated that they can be decided only by a civil court on appreciation of voluminous evidence, or (3) involve serious allegations of forgery/fabrication of documents in support of the fraud plea, or (4) the fraud is alleged against the arbitration provision itself, or (5) the fraud is of such nature that it permeates the entire contract including the arbitration clause, meaning the fraud goes to the validity of the entire contract or the arbitration clause itself. Where fraud allegations concern simple matters of accounts touching upon internal affairs of the party inter se with no public domain implication, arbitration clause need not be avoided and parties shall be relegated to arbitration. The focus of the court under Section 8 must be on whether the nature of the dispute is such that it cannot be referred to arbitration, not on whether the court has jurisdiction.
On this section: Arbitral tribunal has power to rule on its own jurisdiction including on objections to existence or validity of arbitration agreement. Applied to hold that objections should be raised before arbitrator, not rushed to court
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Chloro Controls(i) P. LTD vs Severn Trent Water Purification INC
Court's Decision & Legal Precedent
In multi-party and composite commercial transactions involving multiple interconnected agreements (principal/mother agreement and ancillary/subsidiary agreements), where the principal agreement contains a comprehensive arbitration clause covering disputes 'under or in connection with' such agreement, and the ancillary agreements are integral to performing the objectives of the principal agreement and are referred to therein, the Court shall refer all disputes arising from such composite transaction to arbitration under Section 45 of the Arbitration and Conciliation Act, 1996. This referral can include disputes of non-signatory parties who are claiming through or under the signatory parties to the principal agreement, provided: (1) there is a defined legal relationship between such parties arising from the composite transaction; (2) the parties' manifest intention demonstrates unified dispute resolution through arbitration; (3) the disputes are intrinsically interlinked and capable of composite resolution without risk of conflicting awards on overlapping issues; and (4) no serious challenge is made to the validity, operability or enforceability of the arbitration agreement at the threshold. The expression 'any person claiming through or under' in Section 45 is to be liberally construed to achieve the legislative intent of according primacy to arbitration in international commercial disputes, subject to the exceptions of agreements being null and void, inoperative or incapable of performance. Bifurcation of parties or causes of action is generally not permissible under the 1996 Act, but this does not prevent composite reference of all disputes arising from interlinked agreements forming a unified commercial transaction.
On this section: Permits arbitrator to determine its own jurisdiction; Court notes this provision is absent in Part II Chapter I, suggesting greater obligation on courts to determine validity at threshold in Section 45 cases
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Narayan Prasad Lohia vs Nikunj Kumar Lohia
Court's Decision & Legal Precedent
Where an appellate court has considered only some of the grounds on which a lower court invalidated an award or order, and other substantial grounds remain unexplored, the Supreme Court will remit the matter to the appellate court for full consideration of all grounds in the interest of justice, rather than deciding the remaining grounds without the benefit of the appellate court's reasoning and findings. Additionally, where parties fail to raise statutory objections within prescribed procedures, they waive their right to challenge on those grounds subsequently.
On this section: Deals with challenging tribunal composition; court noted respondents failed to raise timely objections, thereby waiving right to challenge composition
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Questions about Section 16
What have the courts held on Section 16 of the Arbitration and Conciliation Act?
Indian Farmers Fertilizer Cooperative Limited v. Bhadra Products (23 Jan 2018) is the leading judgment on this section among those set out below: Arbitration Act 16 kompetenz-kompetenz is confined to the existence or validity of the arbitration agreement; a limitation ruling is an interim award under ss.2(c)/31(6), not a s.16 jurisdictional finding (IFFCO / Bhadra Products). Do not pad s.34 (already filled). Another 5 judgments on this section are set out below, all of them from the Supreme Court. They run from 2002 to 2018.
How do I find court cases under Section 16 of the Arbitration and Conciliation Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: Arbitration Act 16, section 16 Arbitration Act, section 16 of the Arbitration and Conciliation Act. People searching for it also type arbitration act section 16 jurisdiction objection and arbitration act 1996 section 16. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 6 reported judgments on this section are set out on this page, beginning with Indian Farmers Fertilizer Cooperative Limited v. Bhadra Products (23 Jan 2018).
What should I read with Section 16 of the Arbitration and Conciliation Act, and has it changed?
Its own text turns on section 34 (Application for setting aside arbitral awards), so none of them can safely be read on its own. 1 other provision in this corpus refers back to it.
When did Section 16 of the Arbitration and Conciliation Act come into force?
Section 16 of the Arbitration and Conciliation Act, cited as Arbitration Act 16, came into force on 22 Aug 1996, having been enacted on 16 Aug 1996. It is in force as at the date shown on this page.
Other sections of this Act
- 8. Power to refer parties to arbitration where there is an arbitration agreement1029 words
- 11. Appointment of arbitrators1027 words
- 34. Application for setting aside arbitral awards861 words
- 2. Definitions732 words
- 29A. Time limit for arbitral award635 words
- 57. Conditions for enforcement of foreign awards519 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 15 Oct 2026. This page is not a substitute for legal advice.