The Evolving Landscape of Dispute Adjudication Boards in Indian Law: A Scholarly Analysis
Introduction
Dispute Adjudication Boards (DABs), also referred to as Dispute Review Boards (DRBs) or Dispute Redressal Committees (DRCs) in various contractual contexts, have emerged as a significant feature in the landscape of dispute resolution in India, particularly within the construction and infrastructure sectors. These boards function as a first-tier, project-level mechanism designed to provide swift, expert, and often on-site resolution of disputes that arise during the execution of complex projects. The primary objective of a DAB is to prevent nascent disagreements from escalating into protracted and costly arbitration or litigation, thereby facilitating smoother project progression. This article undertakes a comprehensive analysis of the legal framework governing DABs in India, drawing upon contractual principles, statutory provisions, and judicial pronouncements to elucidate their constitution, functioning, the nature of their decisions, and their critical interplay with formal arbitration proceedings.
The Contractual Foundation of Dispute Adjudication Boards
The institution of a DAB is fundamentally a creature of contract, deriving its existence and powers from the agreement between the parties (Indian Contract Act, 1872). In India, as in many international jurisdictions, DABs are commonly incorporated into complex construction contracts, often influenced by standard forms such as those published by the International Federation of Consulting Engineers (FIDIC). Indian courts have consistently recognized and upheld the contractual basis of these dispute resolution mechanisms. For instance, in Angerlehner Structural And Civil Engineering Co. v. Municipal Corporation Of Greater Mumbai (Bombay High Court, 2017), the court noted that sub-clause 67.1 of the contract stipulated that disputes "shall, in the first place, be referred to the Disputes Review Board." Similarly, Continental Construction Ltd. And Anr. v. Satluj Jal Vidyut Nigam Ltd. (Delhi High Court, 2006) detailed the contractual provisions for the constitution and procedure of a DRB. The Supreme Court in SOM DATT BUILDERS-NCC-NEC(JV) v. NATIONAL HIGHWAYS AUTH.OF INDIA (Supreme Court Of India, 2025) also acknowledged that the contract agreement provided for dispute resolution "at the first instance through a Dispute Review Board ('DRB')". Other cases such as Gammon v. Chennai Metro Rail Limited (Madras High Court, 2015) (referring to Clause 20.4 for DABs), Kunal Structure (India) Pvt. Ltd. Petitioner(S) v. Gujarat Urban Development Company Ltd. (S) (Gujarat High Court, 2014) (Clause 20.2 for DAB appointment), and M.j.s. Construction And Others Applicants v. Union Of India And Others Opposite Parties. (Allahabad High Court, 2023) (Dispute Redressal Committee) further underscore that these bodies operate based on specific contractual mandates. The binding nature of these clauses, rooted in the principle of party autonomy, obligates parties to adhere to the agreed-upon tiered dispute resolution process.
Constitution and Operational Framework of DABs
Appointment and Composition
The composition and appointment process for DAB members are typically outlined in the contract. DABs usually consist of one or three members, chosen for their expertise in the relevant field and their impartiality. As noted in SOM DATT BUILDERS-NCC-NEC(JV) (Supreme Court Of India, 2025), a three-member DRB was constituted with each party appointing one member and the third being appointed by the two party-appointed members. While the Arbitration and Conciliation Act, 1996, particularly Section 12 and its schedules concerning arbitrator neutrality (as discussed in Voestalpine Schienen Gmbh v. Delhi Metro Rail Corporation Limited (Supreme Court Of India, 2017)), does not directly apply to DAB members, the principles of independence and impartiality are paramount for the credibility and effectiveness of the DAB process. Parties generally seek individuals with technical and contractual expertise relevant to the project to ensure informed decision-making.
Procedural Rules and Timelines
The procedural rules governing DABs are also contract-specific. Continental Construction Ltd. (Delhi High Court, 2006) referred to "Annex A" of the contract for the elaboration of DRB procedures. Timelines are a critical aspect of the DAB mechanism, designed to ensure expeditious resolution. For example, CAPACITE INFRAPROJECTS LTD. Vs T. BHIMJYANI REALTY PVT LTD (Bombay High Court, 2023) discussed a contractual stipulation for the DAB to be constituted within 28 days, with failure to do so allegedly frustrating the process. Continental Construction Ltd. (Delhi High Court, 2006) mentioned that the DRB should convene its first meeting not later than 30 days upon its constitution. Furthermore, M.j.s. Construction (Allahabad High Court, 2023) highlighted a 90-day period for the Dispute Redressal Committee (DRC) to give its decision. Non-adherence to these timelines can have significant consequences. In CAPACITE INFRAPROJECTS LTD. (Bombay High Court, 2023), the petitioner argued that the respondent's failure to constitute the DAB within the stipulated period allowed for direct invocation of arbitration, citing M.K. Shah Engineers & Contractors Vs. State of Madhya Pradhesh, (1999) 2 SCC 594.
The Scope and Nature of DAB Decisions
Jurisdiction and Scope of Review
DABs are typically empowered to deal with a wide range of disputes arising during project execution. As per Angerlehner Structural And Civil Engineering Co. (Bombay High Court, 2017), the DRB's scope included "any dispute...in connection with, or arising out of, the Contract or the execution of the Works...including any disagreement by either party with any action, inaction, opinion, instruction, determination, certificate or valuation of the Engineer." This broad jurisdiction allows the DAB to address technical, contractual, and valuation issues promptly. It is important to distinguish the DAB's role from that of an Engineer making routine contractual determinations, although disputes arising from such determinations can be referred to the DAB. The case of Subhash Projects And Marketing Ltd. v. Assam Urban Water Supply And Sewerage Board (Gauhati High Court, 2019), while not directly about DABs, distinguished an Engineer's final decision-making power under certain clauses from an arbitration agreement, highlighting the different roles of pre-arbitral adjudicators.
Binding Effect of Decisions
The binding nature of DAB decisions varies according to contractual provisions. Some contracts may render DAB decisions immediately binding, requiring parties to comply forthwith, even if a party subsequently refers the dispute to arbitration. In other instances, decisions become "final and binding" only if neither party expresses dissatisfaction and initiates arbitration within a stipulated timeframe. Continental Construction Ltd. (Delhi High Court, 2006) provided an example where DRB recommendations for claims up to Rs. 50 million were binding, and for claims beyond that, the DRB's final recommendation would become "conclusive and binding" if arbitration was not initiated within 30 days. Similarly, Kunal Structure (India) Pvt. Ltd. (Gujarat High Court, 2014) noted that "any dispute in respect of which the DBA's decision (if any) has not become final and binding shall be finally settled by international arbitration."
Enforcement and Interim Measures
DAB decisions, even if termed "binding" by the contract, are generally not directly enforceable as court decrees or arbitral awards. Their enforcement relies on the contractual obligation of the parties to comply. If a party fails to comply with a binding DAB decision, the aggrieved party's recourse is typically to refer this non-compliance as a separate dispute to arbitration. While parties may approach courts under Section 9 of the Arbitration and Conciliation Act, 1996, for interim measures of protection, such relief is generally in aid of the arbitration process itself, not for the direct enforcement of a DAB decision as a final determination (Gmr Pochanpalli Expressways Limited v. National Highways Authority Of India (Delhi High Court, 2023)). The case of M/S. Icici Bank Limited / No. 1 v. M/S. Ivrcl Ltd. (Andhra Pradesh High Court, 2015) mentioned a proposal for DAB appointment in a matter involving invocation of bank guarantees and a Section 9 petition, indicating the DAB's place within the broader contractual dispute resolution framework considered by courts.
DABs as a Precursor to Arbitration
Mandatory Nature of the DAB Process
A crucial aspect of multi-tier dispute resolution clauses incorporating DABs is their mandatory nature. Generally, parties are contractually obligated to exhaust the DAB mechanism before they can invoke arbitration. This adherence to agreed procedures is a cornerstone of party autonomy, often upheld by Indian courts. The Supreme Court in National Highways Authority Of India And Another v. Bumihiway Ddb Ltd. (Jv) And Others (Supreme Court Of India, 2006) emphasized that contractual arbitration procedures must be strictly adhered to. The Delhi High Court in National Highways Authority Of India v. Pati-Bel (Jv) (Delhi High Court, 2019), citing English precedent, reinforced that parties who make agreements for dispute resolution must show good reasons for departing from them, supporting the obligatory nature of multi-stage procedures like DAB followed by arbitration.
Interaction with Arbitral Proceedings
If a dispute is not resolved by the DAB, or if a party is dissatisfied with the DAB's decision, the contract typically provides for recourse to arbitration. Arbitral tribunals are generally empowered to review DAB decisions comprehensively. As stated in Gammon v. Chennai Metro Rail Limited (Madras High Court, 2015), "The arbitrator(s) shall have full power to open up, review and revise any decision of the Dispute Adjudication Board, relevant to the dispute." This was echoed in Kunal Structure (India) Pvt. Ltd. (Gujarat High Court, 2014). Importantly, parties are usually not limited in the arbitration proceedings to the evidence or arguments previously presented to the DAB (Gammon v. Chennai Metro Rail Limited (Madras High Court, 2015)). Furthermore, DAB decisions are typically admissible as evidence in subsequent arbitration proceedings (Gammon v. Chennai Metro Rail Limited (Madras High Court, 2015)), providing the arbitral tribunal with the benefit of the DAB's findings and reasoning.
Time Limits for Invoking Arbitration
Contracts often prescribe strict time limits for referring a dispute to arbitration following a DAB decision or recommendation. Adherence to these timelines is critical, as failure to do so may result in the DAB's decision becoming final and binding, precluding subsequent arbitration. Continental Construction Ltd. (Delhi High Court, 2006) specified a 30-day period from the receipt of the DRB's final decision to indicate intention to arbitrate. Similarly, M.j.s. Construction (Allahabad High Court, 2023) mentioned a 30-day period from the receipt of the DRC's decision to give notice for appointment of an arbitrator, failing which the DRC's decision would become final and binding.
Judicial Scrutiny and Upholding of the DAB Mechanism
The Indian judiciary has generally adopted a supportive stance towards contractually agreed multi-tier dispute resolution mechanisms, including DABs. This approach aligns with the principles of party autonomy and the policy objectives of the Arbitration and Conciliation Act, 1996, which promotes minimal judicial intervention. Courts are generally reluctant to allow parties to bypass an agreed DAB process. However, situations such as an alleged failure by one party to cooperate in constituting the DAB, as seen in CAPACITE INFRAPROJECTS LTD. (Bombay High Court, 2023), may lead to judicial examination of whether the pre-arbitral step can be waived or is deemed frustrated. The courts' role primarily involves facilitating the agreed process, such as appointing arbitrators under Section 11 of the Act if the contractual mechanism for appointment fails at the arbitration stage, or granting interim measures under Section 9 to protect the subject matter of the dispute pending the outcome of the tiered resolution process. The overarching principle is to give effect to the parties' bargain for a structured and phased approach to dispute resolution.
Conclusion
Dispute Adjudication Boards have become an integral and valuable component of the dispute resolution framework in India, especially for large-scale construction and infrastructure projects. Their contractual underpinning, coupled with a supportive judicial approach that respects party autonomy, ensures their relevance and effectiveness. By providing a mechanism for expert and timely on-site resolution, DABs contribute significantly to mitigating conflicts, filtering disputes before they reach arbitration, and promoting the smoother execution of projects. While challenges related to their constitution, the binding nature of their decisions, and their interface with arbitration persist, the evolving jurisprudence and increasing contractual sophistication suggest that DABs will continue to play a crucial role in the Indian legal system's efforts to foster efficient and effective dispute resolution. The emphasis on adherence to contractually stipulated pre-arbitral tiers like DABs reinforces the sanctity of contracts and promotes a culture of resolving disputes at the earliest possible stage.