The Arbitration and Conciliation Act, 1996 does not lay down any evidential procedural law. Therefore, arbitrators are still bound by principles of natural justice.
Within the International Arbitration jurisdiction, the process of evidence collection involves a conflict between civil and common law procedures, causing uncertainties in the collection of evidence. The arbitral tribunals have the power to decide their procedure and may conduct the proceedings in a way they consider suitable. In the case of NPCC Limited v. Jyothi Sarup Mittal Engineers, Contractors, and Builders, it was held that arbitral tribunals are not bound by complicated rules of evidence observed by the courts. The admissibility or the relevance of particular evidence is a question that needs to be decided by the tribunal following its good sense and the compliance to any statutory provisions or procedural law is not necessary.
PROBLEMS UNDER INDIAN LAW
Section 19 of the Arbitration and Conciliation Act, 1966 states that the arbitral tribunal shall not be bound by the Indian Evidence Act, 1872, or the Code of Civil Procedure, 1908. The power of the arbitral tribunals in conducting the arbitral proceedings encompasses the power to determine the relevance, admissibility, materiality, and weight of evidence, giving absolute discretion to the arbitrator to accept or reject evidence if it lacks conformance to provisions of the procedural law guiding the admission of evidence.
Their discretionary powers disrupt the evidence collection procedure and make it more ambiguous, further substantiated by –
1. COMPARISON TO IBA GUIDELINES
Problems pertaining to evidence collection in Indian jurisdiction shall be highlighted by comparing the arbitration in India with the IBA Guidelines applicable over international arbitrartion. The IBA rules refer to the ‘good faith standard’ to be applied while admitting evidence. The ‘good faith standard’ is the basis on which the arbitral tribunal has the power to thrust the sanctions to the prejudice of one of the parties to the arbitration. In Indian law, the ‘good faith standard’ is stated under Section 71 of Arbitration and Conciliation Act, 1996. However, this standard has not been used to bestow additional or special powers upon the arbitral tribunal beyond what has already been agreed to by the parties.
2. LACK OF UNIFORMITY WITH INTERNATIONAL LAW
One of the most significant concerns of evidence collection in arbitral proceedings is the lack of a uniform standard. The IBA Rules limit the extent of the documents that are permitted to be produced before the arbitral tribunal as evidence. Similarly, Article 4 of the IBA Rules states that the arbitral tribunal has complete authority to impose a time limit within which the information relating to a witness’s statement must be provided.
However, The Arbitration and Conciliation Act, 1996, doesn’t provide any uniform and standard rules for evidence collection as set out in the IBA Guidelines. In India, the biggest challenge faced in the arbitration is that it does not lead to a speedy resolution of the disputes because the parties tend to find a way to obstruct the arbitration process. Thus, the absence of precise regulations leads to problems in the evidence collection and completion of the arbitration proceedings.
PROBLEMS SPECIFIC TO INTERNATIONAL LAW
The two types of legal systems, civil and common law, create differences in terms of the evidence collection procedure when the parties approaching the tribunal belong to two different legal systems. The rules of evidence collection and procedures vary significantly between civil and common law influence the whole proceedings, especially the evidentiary issues.
1. ORAL EVIDENCE
The difference arises when it comes to the oral evidence from the expert witness and witness of fact, submission of documentary evidence and the conduct of the evidentiary hearings. This is because all arbitration is rooted in writing, namely an arbitration agreement, normally contained in a contract. Negotiations and dealings are usually substantially in writing as well, particularly in international arbitration. Loretta Re, in her article Oral Evidence v Written Evidence: The Myth of the “Impressive Witness, also reiterated that the problems of assessing oral evidence in arbitration. Her conclusion was that oral evidence is not a good indicator of honesty and that non-verbal behaviour such as ‘body language was also not usually helpful. Many parties to arbitration proceedings expect that the proceedings will be conducted similar to the national litigation they come from or that which they are familiar with. Thereby, the clash of different legal traditions and expectations harms the conduct of the arbitral proceedings, including the process of evidence collection.
Each of the parties to the arbitration is influenced by its domestic legal background, tradition and nationality, wherein the fundamental problem that arises is to bridge the differences so that the process of evidence collection is neutral and fair.
2. REMOVAL OF UNCERTAINTIES
It is very pertinent to define the procedural rules for the International practitioners and institutions in cases where both the parties do not agree on the similar evidential proceedings, focusing on the parties’ autonomy, the role of tribunal’s discretion and the impact of the cultural background.
3. PARTIES' AUTONOMY
The rationale working behind this popularity is the flexibility of the process of arbitration which could be secured due to the working principle of party autonomy. Party autonomy proclaims that parties to the arbitration agreement are independent not only to choose laws but also to conduct the arbitration process.
In the recent case of M/s. Addhar Mercantile Pvt. Ltd. v. Shree Jagdamba Agrico Exports Pvt. Ltd, the court disregarded the principle of party autonomy which is the de facto globally recognized norm in arbitration. The explicit decision of the court was that domestic parties cannot have a foreign seated arbitration and Indian parties must abide by Indian laws. However, Hon’ble Supreme court in the above-mentioned case expressly stated Indian Courts will not be empowered to order interim relief in support of foreign seated arbitrations irrespective of any contrary intention or agreement.
To have a harmonious regulation in place there is a need for balancing the party autonomy on one hand and uniform evidential procedural rule on the other. The Arbitration and Conciliation Act, 1996 does not lay down any evidential procedural law, the arbitrators will still be bound by the principles of natural justice. Hence, even in the absence of evidential procedural law, the arbitral tribunal has to follow due procedure in lieu of natural justice and good faith standard, however both the principles are subjective in nature and thereby depending on varied facts and circumstances.
 Nigel Blackaby, Constantine Partasides et al., Redfern and Hunter on International Arbitration (6th ed. 2015).
 IBA Guidelines on the Taking of Evidence in International Arbitration, 2010, Art. 3.
 Laeuchli, UM, Civil and Common Law Contrast and Synthesis in International Arbitration in American Arbitration Association, Handbook on International Arbitration Practice (2010).
 IBA Guidelines on the Taking of Evidence in International Arbitration, 2010.
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