Introduction to the Doctrine and its Doctrinal Roots

The doctrine of Kompetenz-Kompetenz, originating from German jurisprudence, embodies a foundational principle of modern arbitration law: that an arbitral tribunal possesses the authority to determine its own jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement. This principle, enshrined in Article 16(1) of the UNCITRAL Model Law on International Commercial Arbitration, serves as a safeguard against premature judicial intervention, thereby preserving the efficiency and integrity of the arbitral process.

India’s Arbitration and Conciliation Act, 1996 (“1996 Act”) incorporates this doctrine under Section 16, which is modelled almost verbatim on the UNCITRAL formulation. The section ostensibly confers upon arbitral tribunals the authority to rule on their own jurisdiction, including any objections as to the existence or validity of the arbitration agreement. However, the autonomy seemingly conferred upon arbitral tribunals has, in practice, been circumscribed by the interpretative approaches adopted by Indian courts under Sections 8 and 11 of the 1996 Act. These provisions, dealing with judicial referral to arbitration and the appointment of arbitrators respectively, have become the loci of judicial intervention, often determining, at a threshold stage, questions pertaining to arbitrability and validity of the arbitration agreement.

This interplay between arbitral autonomy and judicial oversight has led to considerable doctrinal ambiguity. Decisions such as Vidya Drolia v. Durga Trading Corporation, and more recently, NTPC Ltd. v. SPML Infra Ltd. have reignited scholarly and judicial debates over the contours of the Kompetenz-Kompetenz principle in India. This article seeks to critically examine the doctrinal, statutory, and comparative underpinnings of this principle in the Indian arbitration regime, analysing whether the Indian courts’ approach reflects a dilution of arbitral autonomy or a necessary judicial gatekeeping function tailored to India’s legal and commercial realities.

Statutory and Judicial Framework in India: A Doctrinal-Functional Divergence

Section 16 of the 1996 Act: Legislative Endorsement of Tribunal Competence

The provision closely mirrors Article 16(1) of the UNCITRAL Model Law and includes the affirmation that an arbitration clause contained in a contract shall be treated as an agreement independent of the other terms of the contract. This statutory formulation, read in conjunction with the pro-arbitration objectives of the Act, appears to support the functional autonomy of arbitral tribunals in India.

However, the practical autonomy of the tribunal is circumscribed by the roles assigned to courts under Sections 8 and 11 of the 1996 Act. These provisions have become the principal sites of tension between judicial scrutiny and arbitral independence.

Judicial Appointment under Section 11: Evolving Interpretations

Section 11 empowers courts to appoint arbitrators when parties fail to do so. Initially, in SBP & Co. v. Patel Engineering Ltd., the Supreme Court held that the power under Section 11 was judicial and not administrative. This ruling allowed courts to decide questions relating to the existence and validity of arbitration agreements before a tribunal could be constituted. Consequently, many jurisdictional challenges that were intended for the tribunal under Section 16 came to be decided at the pre-reference stage.

The Court’s decision in S.B.P. & Co v. Patel Engineering Ltd. & Anr was widely criticised for undermining the Kompetenz-Kompetenz principle. It granted Indian courts the discretion to evaluate issues of jurisdiction even before an arbitral tribunal could be seized of the matter.

Recalibration in Vidya Drolia: Prima Facie Standard and Judicial Restraint

A corrective shift occurred in Vidya Drolia v. Durga Trading Corporation, where a three-judge bench of the Supreme Court clarified the scope of judicial intervention under Sections 8 and 11. The Court introduced a prima facie standard for determining the existence of an arbitration agreement. Courts were directed to refer disputes to arbitration unless the agreement was manifestly invalid, non-existent, or inapplicable. All other objections, including those relating to arbitrability and jurisdiction, were to be left to the tribunal under Section 16.

Vidya Drolia thus sought to realign Indian arbitration law with international standards by reducing the depth of judicial engagement at the pre-reference stage. However, the judgment left interpretive gaps by allowing courts to refuse reference in cases of ‘manifest illegality’, a phrase which has been construed inconsistently by lower courts. This has led to divergent applications and a lingering uncertainty in how Kompetenz-Kompetenz operates in practice.

NTPC v. SPML (2024): Towards Functional Deference?

The Supreme Court in NTPC Ltd. v. SPML Infra Ltd. (2024) reaffirmed the prima facie standard and reiterated that jurisdictional objections must ordinarily be left to the tribunal. The Court emphasised that only in exceptional cases, where the invalidity of the arbitration agreement is evident on the face of the record, should courts intervene.

The judgment was widely welcomed for clarifying the limited scope of judicial scrutiny. However, it stopped short of eliminating judicial discretion altogether, continuing to permit preliminary review by the courts under certain undefined circumstances.

Continuing Ambivalence in Implementation

Despite these progressive judgments, the functional application of Section 16 remains uneven. In their authoritative commentary, Malhotra and Indu Malhotra (The Law and Practice of Arbitration and Conciliation, 6th ed., 2021) caution that judicial discipline is crucial for realising the full potential of Kompetenz-Kompetenz in India. They argue that unless the courts consistently apply the prima facie standard and defer jurisdictional questions to the tribunal, the autonomy promised under Section 16 risks remaining more formal than real.

The jurisprudence thus reveals a fundamental ambivalence. While India has incorporated the doctrine in letter, its realisation in practice depends on whether courts are willing to adopt a posture of restraint in the face of complex jurisdictional disputes.

Comparative Jurisprudence: LCIA, SIAC, ICC and the Indian Divergence

Globally, leading arbitral institutions have consistently endorsed the doctrine of Kompetenz-Kompetenz, granting tribunals primary authority to rule on their own jurisdiction. This is not merely a procedural formality but a substantive affirmation of arbitral autonomy. The LCIA Rules 2020, under Article 23.1, provide that tribunals may rule on their jurisdiction, including challenges to the existence or validity of the arbitration agreement, without prior recourse to courts. Likewise, Rule 25.1 of the SIAC Rules 2016 empowers tribunals with identical jurisdictional authority, and Article 6(5) of the ICC Arbitration Rules 2021 allows proceedings to continue even where jurisdiction is contested, with the tribunal deciding such objections in the first instance.

These frameworks adopt a clear institutional model: arbitral tribunals, not courts, are the proper forum for resolving jurisdictional disputes in the first instance. Judicial scrutiny is deferred to the post-award stage or allowed only in exceptional circumstances.

By contrast, the Indian arbitration regime retains a structurally different model. Sections 8 and 11 of the 1996 Act, require judicial evaluation at the pre-reference stage. While the Supreme Court in Vidya Drolia v. Durga Trading Corporation introduced a prima facie threshold to limit such interference, Indian courts still assess jurisdiction in some cases where arbitral autonomy ought to prevail.

In jurisdictions such as France and Switzerland, courts may intervene only where an arbitration agreement is manifestly void or inapplicable [France: CPC Article 1448]. India, despite adopting the UNCITRAL Model Law, has yet to fully internalise this negative effect. As a result, it risks maintaining a dual regime where statutory intent and functional reality remain misaligned.

Conclusion

The doctrine of Kompetenz-Kompetenz, enshrined in Section 16 of the Arbitration and Conciliation Act, 1996, is central to preserving arbitral autonomy. However, its efficacy is diluted by judicial powers under Sections 8 and 11, which permit early-stage court intervention, often undermining the tribunal’s ability to rule on its own jurisdiction.

While Vidya Drolia v. Durga Trading Corporation and NTPC Ltd. v. SPML Infra Ltd. have reaffirmed a prima facie standard for judicial review, ambiguity in the interpretation of terms like ‘manifest invalidity’ continues to invite discretionary interference. As a result, tribunals are too often pre-empted before exercising their full competence. By contrast, jurisdictions such as France and Switzerland recognise the negative effect of Kompetenz-Kompetenz, allowing courts to intervene only in clear cases of invalidity. Arbitral institutions like the LCIA, ICC, and SIAC similarly curtail judicial involvement by centralising the determination of jurisdiction within the tribunal or appointing body itself.

India must consider two key reforms. First, a legislative clarification limiting judicial scrutiny under Sections 8 and 11 to truly prima facie assessments. Second, greater institutionalisation of arbitration, particularly in the appointment process, can further shield tribunals from premature judicial interruption.

Ultimately, for Kompetenz-Kompetenz to be effective in practice and not merely in theory, the law must reinforce the tribunal’s right to determine its own jurisdiction. Without such recalibration, India’s arbitration regime risks falling short of global standards.