Executive Summary

The arbitral award is the final determination of the dispute by the tribunal, equivalent to a court decree. Section 31 regulates the form, content, and essential requirements:

Section 31: Form and contents of arbitral award
Writing and signature: Mandatory requirements
Reasoning: Awards must state reasons
Date and seat: Required for determining limitation and enforceability
Majority decision: Sufficient in multi-arbitrator tribunals
Types of awards: Final, partial, interim (Section 32)
Interest: Section 31(7) governs interest awards

This guide examines the legal requirements, types of awards, and drafting considerations.

1. Statutory Framework - Section 31

Section 31(1) - Form of Award

Requirement	Description
In writing	Award must be written document
Signed by arbitrators	All arbitrators must sign
Majority signature sufficient	In multi-arbitrator tribunal, if majority sign
Reasons for non-signature	Reasons must be stated if any arbitrator doesn't sign

Section 31(2) - Date and Seat

Requirement	Purpose
Date of award	Determines limitation period for Section 34
Seat of arbitration	Determines applicable law and supervisory court

Section 31(3) - Reasons

"The arbitral award shall state the reasons upon which it is based, unless the parties have agreed that no reasons are to be given."

Principle	Application
Reasoned award mandatory	Default requirement
Exception	Parties may agree to dispense with reasons
Adequacy	Reasons must be sufficient to show application of mind

Section 31(4) - Costs

Award shall fix costs of arbitration and decide which party shall bear costs.

Section 31(7) - Interest

Type	Application
Pre-reference interest	From date of cause of action to date of reference to arbitration
Pendente lite interest	During arbitration proceedings
Post-award interest	From date of award until payment
Default rate	18% per annum (if not specified)

2. Essential Contents of Award

Mandatory Elements

Element	Requirement	Consequence of Omission
Parties' names and addresses	Identify parties	Award may be unclear
Arbitrators' names	Identify tribunal members	Validity issue
Arbitration agreement	Reference to agreement	Jurisdictional clarity
Claims and defenses	Summary of parties' positions	Lack of reasoning
Findings on facts and law	Determination of issues	Non-speaking award
Conclusions	Final determination	Award incomplete
Relief granted	Specific relief awarded	Unenforceable
Costs	Costs allocation	Section 31(4) violation
Date	Date of making award	Section 31(2) violation
Seat	Place of arbitration	Section 31(2) violation
Signatures	All or majority of arbitrators	Section 31(1) violation

3. Types of Awards

Final Award

Feature	Description
Definition	Award that finally determines all issues
Effect	Ends arbitration
Enforcement	Enforceable as decree (Section 36)
Challenge	Section 34 within 3 months

Partial Award - Section 31(6)

Feature	Description
Definition	Award on some issues, leaving others pending
When used	Issues can be separated
Examples	Liability determined, quantum pending; jurisdiction determined, merits pending
Enforceability	Enforceable immediately
Challenge	Can be challenged under Section 34

Interim Award - Section 32(1)

Note: Post-2015 amendment, "interim award" term is not used; tribunals issue "interim orders" under Section 17, not interim awards.

Pre-2015	Post-2015
Interim award	Interim order (Section 17)
Enforceable as decree	Yes (Section 17(2))
Appealable	No, challenge only after final award

4. Majority Decision and Dissenting Opinion

Section 31(1) - Majority Sufficient

Scenario	Validity
Three arbitrators, all sign	Valid
Three arbitrators, two sign with majority view	Valid
Three arbitrators, one signs	Invalid
Presiding arbitrator's casting vote	Valid if provided in agreement

Dissenting Opinion

Aspect	Practice
Permitted	Yes, dissenting arbitrator may record dissent
Effect	No effect on validity of majority award
Attached to award	Dissent may be appended
Reasoning	Dissent should state reasons for disagreement

5. Reasoning Requirement - Section 31(3)

Why Reasoning is Mandatory

Reason	Purpose
Transparency	Parties understand basis of decision
Accountability	Arbitrators show application of mind
Review	Courts can review for Section 34 grounds
Enforceability	Reasoned awards more easily enforceable

Adequate vs. Inadequate Reasoning

Adequate Reasoning	Inadequate Reasoning
Issues identified	Issues not framed
Evidence discussed	Evidence ignored
Law applied	Legal provisions not cited
Logical conclusions	Contradictory findings
Factual findings	Conclusory statements only

Case Law on Reasoning

Case	Holding
Associate Builders v. DDA	Reasons must be evident from award
MMTC v. Vedanta	Award must show arbitrator considered submissions
Perceptive adequacy	Reasons need not be elaborate but must show application of mind

6. Interest Awards - Section 31(7)

Types of Interest

Type	Period	Rate
Pre-reference interest	Cause of action → reference to arbitration	As per contract or tribunal discretion
Pendente lite interest	Reference to arbitration → award	As per contract or tribunal discretion
Post-award interest	Award → payment	18% per annum (default) or as awarded

Section 31(7)(a) - Pre-Reference and Pendente Lite

"Unless otherwise agreed by the parties, where and in so far as an arbitral award is for the payment of money, the arbitral tribunal may include in the sum for which the award is made interest, at such rate as it deems reasonable, on the whole or any part of the money, for the whole or any part of the period between the date on which the cause of action arose and the date on which the award is made."

Section 31(7)(b) - Post-Award Interest

"A sum directed to be paid by an arbitral award shall, unless the award otherwise directs, carry interest at the rate of eighteen per centum per annum from the date of the award to the date of payment."

Compound Interest

Issue	Position
Pre-2016	Tribunals lacked power to award compound interest
2016 Amendment (Section 31(7A))	Deleted (never notified)
Current position	Tribunals can award compound interest if contract provides or parties agree

7. Costs - Section 31(4) and Section 31A

Section 31(4) - Tribunal Shall Fix Costs

"The costs of an arbitration shall be fixed by the arbitral tribunal."

Section 31A - Costs Regime (2019 Amendment)

Principle	Application
Costs follow event	Unsuccessful party pays costs
Exceptions	Tribunal may apportion differently
Unreasonable conduct	Penalty costs for unreasonable conduct
Disclosure required	Parties must disclose costs

Types of Costs

Type	Description
Arbitrator fees	Fees of arbitrators
Administrative costs	Institutional fees (if institutional arbitration)
Legal fees	Lawyers' fees
Expert fees	Expert witness fees
Other expenses	Travel, hearing venue, transcript, translation

Apportionment Factors

Factor	Consideration
Success ratio	Proportionate success of parties
Conduct	Unreasonable conduct, delay tactics
Offers to settle	Whether party rejected reasonable settlement
Complexity	Whether party caused complexity

8. Correction and Interpretation - Section 33

Section 33(1) - Correction of Errors

Type of Error	Correctable?
Computational errors	Yes
Clerical errors	Yes
Typographical errors	Yes
Errors arising from accidental slip or omission	Yes
Errors of law or fact	No

Timeline: Within 30 days of receipt of award (party request) or tribunal suo motu.

Section 33(2) - Interpretation

Parties may request interpretation of specific point or part of award.

Requirement	Application
Timeline	30 days from receipt of award
Scope	Interpretation, not review or reconsideration
Tribunal decides	Whether to interpret

Section 33(3) - Additional Award

Party may request additional award for claims presented but not decided.

Requirement	Application
Timeline	30 days from receipt of award
Scope	Only claims already presented
Tribunal discretion	Whether claim was inadvertently omitted
Timeline for additional award	60 days from request

9. Currency of Award

Indian Currency Awards

Arbitration Type	Currency
Domestic arbitration	Indian Rupees (INR)
International commercial arbitration (Part I)	Foreign currency permissible

Foreign Currency Awards

Situation	Validity
Contract in foreign currency	Award can be in foreign currency
Parties agreed	Award in agreed currency
International transactions	Foreign currency award permissible
Enforcement	May need conversion for execution

10. Specific Performance and Injunctive Relief

Tribunal's Power to Grant

Relief	Permissible?
Specific performance	Yes
Injunction	Yes (final injunction in award)
Declaratory relief	Yes
Rectification	Yes
Appointment of receiver	Yes (in award)

Enforceability

Relief	Enforcement
Monetary award	Easy enforcement
Specific performance	Enforceable as decree, execution under CPC
Injunction	Enforceable as decree
Declaratory	Binding declaration

11. Award Drafting Checklist

Structure of Award

Section	Content
Title	"Arbitral Award"
1. Parties	Names, addresses, legal status
2. Tribunal	Names and addresses of arbitrators
3. Arbitration Agreement	Reference to arbitration clause/submission agreement
4. Seat and Venue	Seat (legal) and venue (physical hearings)
5. Procedural History	Chronology of proceedings
6. Parties' Cases	Summary of claimant's claims and respondent's defenses
7. Issues	Issues for determination
8. Evidence	Summary of evidence presented
9. Findings - Facts	Factual findings on each issue
10. Findings - Law	Legal analysis and conclusions
11. Determination of Issues	Answer to each issue
12. Relief/Award	Specific relief granted or denied
13. Interest	Pre-reference, pendente lite, post-award
14. Costs	Costs allocation
15. Operative Part	Summary of award ("IT IS AWARDED:")
16. Date and Place	Date and seat of award
17. Signatures	Signatures of all or majority arbitrators

12. Operative Part of Award

Key Elements

Element	Example
Award in favor of	"Award in favor of the Claimant and against the Respondent"
Monetary award	"Respondent shall pay Claimant INR 50,00,000"
Specific performance	"Respondent shall execute the sale deed within 30 days"
Interest	"With interest @ 12% per annum from [date] to [date]"
Post-award interest	"Post-award interest @ 18% per annum until payment"
Costs	"Respondent shall pay Claimant's costs totaling INR 10,00,000"
Dismissal	"Claimant's claim is dismissed"

Language

Principle	Application
Clear and unambiguous	No room for interpretation
Specific	Exact amounts, dates, actions
Enforceable	Capable of execution
Self-contained	Complete on its own

13. Termination of Arbitration - Section 32

Grounds for Termination

Ground	Section
Final award	Section 32(1) - Award resolves all issues
Settlement agreement	Section 30 - Parties settle, tribunal records as consent award
Withdrawal/abandonment	Section 32(2)(b) - Claimant withdraws
Tribunal finds continuation unnecessary/impossible	Section 32(2)(c)
Tribunal resignation	Section 14 - Arbitrators resign

Section 32(1) - Award Effect

"The arbitral proceedings shall be terminated by the final arbitral award or by an order of the arbitral tribunal under sub-section (2)."

Settlement During Arbitration

Step	Action
1	Parties reach settlement
2	Parties request tribunal to record settlement
3	Tribunal records settlement as award on agreed terms
4	Award has same status and effect as any other award
5	Enforceable under Section 36

Advantage	Benefit
Enforceability	Enforceable as arbitral award
Finality	Binding and final
Limited challenge	Cannot be challenged on merits
Cost recovery	Can include costs as agreed

15. Enforcement - Section 36

Section 36(1) - Enforcement as Decree

"Where the time for making an application to set aside the arbitral award under section 34 has expired... the award shall be enforced in accordance with the provisions of the Code of Civil Procedure, 1908 in the same manner as if it were a decree of the Court."

Condition	Requirement
Section 34 time expired	3 months + 30 days (if extension granted)
OR Section 34 application dismissed	Court rejects challenge
Enforceable as decree	Through execution proceedings

16. Challenges to Award - Section 34

Grounds for Setting Aside (See Blog_10)

Ground	Section 34 Reference
Party incapacity	Section 34(2)(a)(i)
Invalid arbitration agreement	Section 34(2)(a)(i)
Lack of notice/opportunity	Section 34(2)(a)(ii)
Award beyond scope	Section 34(2)(a)(iii)
Tribunal composition irregular	Section 34(2)(a)(iv)
Non-arbitrability	Section 34(2)(b)(i)
Public policy	Section 34(2)(b)(ii)

17. Compliance Checklist

For Tribunals Drafting Award

Writing: Award in writing (not oral)
Parties identified: Full names, addresses, legal status
Tribunal identified: Arbitrator names and addresses
Arbitration agreement: Reproduced or referenced
Procedural history: Chronology of proceedings
Parties' cases: Summary of claims, defenses, counterclaims
Issues framed: Clear issues for determination
Evidence summarized: Key evidence discussed
Factual findings: Findings on disputed facts
Legal analysis: Application of law to facts
Reasoning: Clear reasoning on each issue (Section 31(3))
Conclusions: Logical conclusions from findings
Relief granted: Specific relief awarded
Interest: Pre-reference, pendente lite, post-award (Section 31(7))
Costs: Costs fixed and allocated (Section 31(4))
Date: Date of making award (Section 31(2))
Seat: Seat of arbitration stated (Section 31(2))
Signatures: All or majority of arbitrators signed (Section 31(1))
Dissent noted: If any arbitrator dissents, reasons stated (Section 31(1))
Language clear: Unambiguous, enforceable language
No errors: Check for computational, clerical, typographical errors

18. Key Takeaways for Practitioners

Form and Content Mandatory: Section 31 requires writing, signatures, date, seat, reasons, and costs.
Reasoning is Essential: Awards must state reasons unless parties agree otherwise.
Majority Signature Sufficient: In multi-arbitrator tribunal, majority signature validates award.
Interest Default is 18%: Post-award interest is 18% per annum unless award specifies otherwise.
Partial Awards Permissible: Tribunal can issue partial awards on severable issues.
Costs Follow Event: Section 31A codifies costs follow event principle (2019 amendment).
Correction Mechanism: Section 33 allows correction of clerical/computational errors within 30 days.

Conclusion

The arbitral award is the culmination of the arbitral process, embodying the tribunal's final determination of the dispute. Section 31 prescribes essential formal requirements—writing, signature, date, seat, reasons, and costs—ensuring awards are clear, enforceable, and capable of judicial review. Practitioners must ensure awards comply with statutory requirements to avoid challenges under Section 34 and to facilitate enforcement under Section 36. Proper drafting, adequate reasoning, and compliance with procedural formalities are critical for effective and enforceable arbitral awards.

Arbitral Award: Section 31 Form, Content, and Requirements