How is the Jurisdiction decided in Arbitration

Section 16 of the Act confers power to the arbitral tribunal to rule on their own jurisdiction, including objection with respect to existence or validity of arbitration agreement.

This power is also referred to as the principle of competence-competence. The principle of separability gives effect to the principle of competence-competence as it entails that arbitration clause shall be treated separate and independent of the other terms in the contract. As a result, even if tribunal rules that the contract is null and void, it shall not ipso jure invalidate the arbitration clause.

A plea that the tribunal lacks jurisdiction can be raised only before submission of statement of defence. Participation in appointment of tribunal does not preclude a party from raising such a plea.

A plea that the tribunal exceeded the scope of authority shall be raised as soon as the matter beyond the scope of its authority raised.

The tribunal can reject such pleas and continue with the proceedings and make an arbitral award. Aggrieved party can make an application for setting aside such award under Section 34.

If a tribunal decides that it does not have jurisdiction, it cannot make an award on the merits.