Benton GlobalTech Solutions Private Limited (BGSP), an Indian IT services company, is engaged in an arbitration proceeding against Innovatech Inc., a US-based technology firm. The arbitration is governed by the Arbitrati

CS Professional · Arbitration, Mediation and Conciliation · PYQS · December 2024
Benton GlobalTech Solutions Private Limited (BGSP), an Indian IT services company, is engaged in an arbitration proceeding against Innovatech Inc., a US-based technology firm. The arbitration is governed by the Arbitration and Conciliation Act, 1996, which permits the use of modern technology in the proceedings. The primary dispute involves allegations of breach of contract, where BGSP claims that Innovatech Inc failed to deliver critical software updates as per the contract terms. Both parties have numerous witnesses located in different parts of the world, making traditional in-person hearings logistically challenging. The dispute centers on allegations that Innovatech Inc failed to deliver crucial software updates on time, as stipulated in their contract with BGSP. The contract also included provisions for ongoing maintenance and support services, which BGSP claims were not provided. The parties had agreed to arbitration under the Arbitration and Conciliation Act, 1996, with London, designated as the seat of arbitration. BGSP has technical experts and witnesses located in multiple Indian cities, including Mumbai, Bangalore, and Hyderabad. Conversely, Innovatech Inc has key witnesses and experts based in New York, San Francisco and Seattle. Due to the global nature of the dispute and the geographical distance between the parties, BGSP proposed using video conferencing to record witness statements and conduct hearings. With reference to judicial pronouncements, explain whether arbitration proceedings can be completed using video conferencing?

Answer & Explanation:

Online Dispute Resolution (ODR) is the use of internet technology to resolve the disputes between the parties outside of the public court system. In its most basic sense, ODR is the use of technology to 'resolve' disputes. It is not just any form of technology integration (such as electronically scheduling a session), but its active use to help resolve the dispute (such as video conferencing for hearings or electronic document sharing for filing). Though derived from Alternate Dispute Resolution (ADR), ODR's benefit extends beyond just e-ADR or ADR that is enabled through technology. ODR can use technology tools that are powered by AI/ML in the form of automated dispute resolution, script based solution and curated platforms that cater to specific categories of disputes. In State of Maharashtra vs. Dr. Praful B. Desai (2003 4 SCC 601) , the Supreme Court acknowledged the use of video conferencing to record witness statements. Therefore, the submissions and the proceedings can take place online and duly valid under the Arbitration Act. In Grid Corporation of Orissa Ltd. vs. AES Corporation (2002) 7 SCC 736) , the Supreme Court explicitly mentions that: 'When an effective consultation can be achieved by resort to electronic media and remote conferencing, it is not necessary that the two persons required to act in consultation with each other must necessarily sit together at one place unless it is the requirement of law or of the ruling contract between the parties'. In view of the above discussion, it may be said that there is no restriction on use of video conferencing for completion of arbitration proceedings.

Topics: Arbitration Proceedings

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