Section 16 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 16 lets the arbitral tribunal decide whether it has jurisdiction, including objections about the existence or validity of the arbitration agreement. It treats the arbitration clause as separate from the rest of the contract and sets time limits for raising a jurisdiction plea.
The tribunal may rule on its own jurisdiction, including on objections to the existence or validity of the arbitration agreement. An arbitration clause that is part of a contract is treated as an agreement independent of the other terms, and a decision that the contract is null and void does not entail ipso jure the invalidity of the clause. A plea of no jurisdiction must be raised not later than the submission of the statement of defence; a plea that the tribunal is exceeding its authority must be raised as soon as the matter arises. If the tribunal rejects the plea, it continues, and a party may apply under section 34 after the award. This is as per the India Code consolidated text consulted.
What section 16 does
A party who disputes arbitration will often say: "there is no valid agreement" or "this dispute is outside it". Section 16 gives the first decision on those questions to the tribunal itself, subject to the later check under section 34. It works alongside section 8, where a court refers parties to arbitration if there is no prima facie invalid agreement; see section 8.
In the India Code consolidated text, section 16 opens Chapter IV of Part I, "Jurisdiction of arbitral tribunals", and carries no footnote of amendment. One phrase in the official text reads awkwardly and is quoted as printed: sub-section (2) says "merely because that he has appointed". If a jurisdiction objection is likely in your matter, a legal dispute resolution review before the first pleading will help you time it correctly.
Sub-section (1): the tribunal rules on its own jurisdiction
The tribunal "may rule on its own jurisdiction, including ruling on any objections with respect to the existence or validity of the arbitration agreement". For that purpose, two rules apply:
| Clause | Rule |
|---|---|
| (a) | An arbitration clause which forms part of a contract shall be treated as an agreement independent of the other terms of the contract |
| (b) | A decision by the arbitral tribunal that the contract is null and void shall not entail ipso jure the invalidity of the arbitration clause |
This is often called separability. In plain terms, if a party says the whole contract is void, the arbitration clause does not automatically fall with it, and the tribunal can still decide the question. A buyer who says the supply contract was never validly formed can still be sent to the tribunal that the clause appoints, which then decides.
What counts as an arbitration agreement is dealt with in section 7; see our post on section 7.
Sub-section (2): when to raise a plea of no jurisdiction
"A plea that the arbitral tribunal does not have jurisdiction shall be raised not later than the submission of the statement of defence; however, a party shall not be precluded from raising such a plea merely because that he has appointed, or participated in the appointment of, an arbitrator."
Two points follow.
- The deadline is the statement of defence. The statement of defence is dealt with in section 23; see section 23. A respondent should therefore put the jurisdiction plea in, or before, its defence.
- Appointing an arbitrator does not bar the plea. Naming an arbitrator, or taking part in naming one, does not in itself stop a party from objecting to jurisdiction.
Sub-section (3): exceeding the scope of authority
"A plea that the arbitral tribunal is exceeding the scope of its authority shall be raised as soon as the matter alleged to be beyond the scope of its authority is raised during the arbitral proceedings."
This is a different plea from sub-section (2). Sub-section (2) says the tribunal never had jurisdiction. Sub-section (3) says it is going beyond what it was asked to decide. For example, if the reference is about unpaid invoices and the claimant starts to claim a termination of a distribution right, the respondent should object when that claim is raised, not months later.
Sub-section (4): late pleas
"The arbitral tribunal may, in either of the cases referred to in sub-section (2) or sub-section (3), admit a later plea if it considers the delay justified." The decision to admit a late plea is the tribunal's, and the test is that the delay is justified. The text gives no further criteria.
Sub-section (5): the tribunal decides, then continues
The tribunal "shall decide on a plea referred to in sub-section (2) or sub-section (3) and, where the arbitral tribunal takes a decision rejecting the plea, continue with the arbitral proceedings and make an arbitral award." Section 16 provides no pause for a separate court step where the plea is rejected. If the tribunal accepts the plea, section 16 itself does not say what then happens; an order accepting the plea is dealt with in section 37, which has its own article: see section 37 on appealable orders.
Sub-section (6): section 34
"A party aggrieved by such an arbitral award may make an application for setting aside such an arbitral award in accordance with section 34." So a rejected plea is pursued after the award. Our post on section 34 covers that section and is not re-explained here. Section 13(5) takes the same route for a failed challenge to an arbitrator; see section 13.
Section 16 compared with sections 8 and 13
| Section | Question | Who decides first |
|---|---|---|
| 8 | Is there prima facie a valid agreement, so should the parties be referred? | The judicial authority |
| 13 | Should the arbitrator be removed? | The tribunal, unless the arbitrator withdraws or the other side agrees |
| 16 | Does the tribunal have jurisdiction, or is it exceeding its authority? | The tribunal |
A worked example
Reddy Motors supplies spare parts to Soni Auto under a contract with an arbitration clause. Soni receives a notice of arbitration and believes the contract was signed by an unauthorised person. In its statement of defence, Soni raises a plea that the tribunal has no jurisdiction because there was no valid contract. Under sub-section (1)(a), the clause is treated as independent. The tribunal rules on the plea. If it rejects the plea, it continues and makes an award under sub-section (5), and Soni may apply under section 34 under sub-section (6). Had Soni raised the point only after filing its defence, it would have needed the tribunal to accept the delay as justified under sub-section (4).
Practical steps
- Plead the jurisdiction objection in or before the statement of defence.
- Keep a record of every document that sets out the arbitration agreement.
- If a new claim goes outside the reference, object at once, in writing.
- Do not assume that naming an arbitrator waives the plea; sub-section (2) says it does not by itself.
- Plan for section 34 if the plea is rejected.
Need help with a jurisdiction objection?
Raising the objection at the right time and in the right form often decides how an arbitration unfolds. Our legal dispute resolution team can review the clause and pleadings and plan the sequence of steps with you.
Key takeaways
- The tribunal may rule on its own jurisdiction, including on the existence or validity of the arbitration agreement.
- The arbitration clause is treated as independent of the other terms of the contract.
- A plea of no jurisdiction must be raised not later than the statement of defence; a plea of excess of authority as soon as the matter arises.
- Later pleas can be admitted if the tribunal considers the delay justified.
- A rejected plea does not stop the arbitration; the party can apply under section 34 after the award.
Read next
- Section 23: statements of claim and defence
- Section 13: challenge procedure for an arbitrator
- Challenge to an arbitral award: section 34
- Arbitration agreement: section 7
Disclaimer: Based on the India Code consolidated text of the Arbitration and Conciliation Act, 1996, whose footnotes show amendments up to Act 3 of 2021 and a latest date of 12 October 2023, as consulted on 2 October 2026. Rules, regulations and notifications under the Act, later amendments and the commencement of the Mediation Act, 2023 should be checked. This article is general information, not legal advice; check the official text before acting.