Bombay High Court flags NBFCs, banks unilaterally appointing arbitrators through institutions or algorithms
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Summary
The Bombay High Court has sharply criticised IIFL Finance Limited for using the strategy of masking unilateral arbitrator appointments by routing them through institutions or algorithm-based selection platforms. [DS Textiles v. IIFL Finance Ltd].The Court noted an increasing trend of non-banking financial companies (NBFCs) and banks unilaterally appointing arbitrators through an institution or an algorithm, hoping this cleanses the inherent illegality.“An increasing trend is being seen in a numb