35. It will now be appropriate to summarize the legal position as under:

(a) The arbitral tribunal is bound by the fee or remuneration fixed by the parties in the arbitration agreement, or by mutual consent, whether before or after the disputes have arisen.

(b) Where the court refers disputes to an arbitral tribunal, in the absence of any agreement between the parties fixing the fee payable to the arbitral tribunal, it should fix the fee so payable. The fee fixed by the court is binding on the arbitral tribunal

(c) It is desirable that the parties/court should ascertain the fee structure from the prospective arbitrators before an arbitrator is nominated/appointed.

(d) In the absence of a written agreement or a court order fixing the fee of the arbitral tribunal, the arbitral tribunal is entitled to ‘fair and reasonable fee’, which should be done in a transparent manner and in consultation with the parties. This exercise should be undertaken at the initial/preliminary stage. However, lack of consensus, would not bar an arbitral tribunal from fixing ‘fair and reasonable fee’. An aggrieved party would be entitled to question the fee fixed by the arbitral tribunal in terms of Section 39 of the A&C Act. On a challenge being raised, the court would examine the question of reasonableness of fee with reference to the factors stated above and in particular with reference to the Fourth Schedule of the A&C Act. The fee structure mentioned in the Fourth Schedule or by the respective High Courts would be per se treated and regarded as ‘fair and reasonable fee’.

(e) Fee once fixed cannot be increased or enhanced except with the consent of all the parties or by an order of the court.

(f) Post the enactment and enforcement of Act No. 33 of 2019, and in terms of the first proviso to sub-section (3A) of Section 11 of the A&C Act, the arbitral tribunal is entitled to the fee at the rate specified in the Fourth Schedule. Consequently, the arbitral tribunal is not entitled to deviate and fix a higher fee. Similarly, arbitral institutions, in terms of Section 11(14), are bound to follow the fee structure mentioned in the Fourth Schedule. However, sub-sections (3A) and (14) of Section 11 do not bar or prohibit the ad hoc arbitral tribunal or the arbitral institution to charge arbitration fee which is less or lower than what is stipulated in the Fourth Schedule. Sub-sections (3A) and (14) of Section 11 are binding on the parties and the arbitral tribunal.