A Section 21 notice (also called a notice invoking arbitration) is the written request by which one party asks the other to refer a dispute to arbitration, and under Section 21 of the Arbitration and Conciliation Act, 1996 the arbitration is treated as having commenced on the date the respondent receives it. Reply in writing, within the time the notice gives (or within a reasonable 7–30 days if it is silent), and — this is the part most people miss — expressly refuse your consent to any arbitrator the sender has named on its own. Staying silent does not protect you: a unilaterally appointed arbitrator is bad in law, but your silence can later be argued as acceptance, so the objection must be on record in your reply.
This page explains exactly what to put in that reply, what makes the sender's notice valid or defective, why the unilateral-appointment objection is your strongest ground after the Supreme Court's Perkins Eastman and CORE judgments, how long you have, what it costs if the matter reaches court, and when you should brief an advocate instead of replying yourself. It is the English companion to our Hindi guide on arbitration notice ka jawab kaise de.
What a Section 21 notice actually is
A Section 21 notice is a written communication that refers to the arbitration clause in your contract and calls upon you to agree to refer the dispute to arbitration; it fixes the date arbitration commences and the date limitation stops running. It is the trigger for the whole arbitral process, and it is where the appointment of the arbitrator is supposed to be agreed, not imposed.
Most people receive one of two kinds:
- A genuine commercial dispute notice — a contractor, supplier, builder, or JV partner invoking the arbitration clause after a payment or performance dispute.
- A lender/NBFC notice — SBI Cards, Bajaj Finance, and similar lenders send Section 21 notices on credit-card or loan dues that already name their chosen sole arbitrator. These are the notices where the unilateral-appointment objection below is almost always available.
Under Section 21, "unless otherwise agreed by the parties, the arbitral proceedings in respect of a particular dispute commence on the date on which a request for that dispute to be referred to arbitration is received by the respondent." Receipt — not dispatch — is the trigger (the Delhi High Court has held that merely sending a notice is not enough). That single word matters for limitation, discussed below.
How long you have to reply
There is no fixed statutory reply period in Section 21 itself. In practice:
- Honour the deadline in the notice. Most notices give 7, 15, or 30 days. Reply within it.
- If the notice is silent, reply within a reasonable time — treat 30 days as the outer limit, because Section 11(4)/(5) of the Act gives the sender the right to approach the court for appointment of an arbitrator if the parties fail to agree on an arbitrator within 30 days of the request. Replying inside that window keeps you inside the "we tried to agree" stage.
- Do not wait and do nothing. If you ignore the notice and the sender simply appoints its own arbitrator and proceeds ex parte, you may be fighting the award later under Section 34 — a far harder and costlier battle than a two-page reply now.
If the notice names an arbitrator and you do nothing, the appointment is still legally untenable — but your inaction hands the other side an argument. Put your refusal in writing now.
What makes a Section 21 notice valid (and how to check the one you received)
Before you concede anything, check whether the notice even qualifies under Section 21. Courts have held that, at a minimum, a valid notice must:
- Refer to the arbitration clause in the agreement (the Delhi High Court has held a communication must "at the very least, refer to the arbitration clause" to count as a Section 21 notice).
- Identify the dispute and the claims being referred.
- Be actually received by you (receipt, not mere posting).
If the notice does none of these — for example a bare demand letter with no mention of arbitration — you can and should point that out in your reply. A defective notice is not fatal to the other side forever, but flagging it preserves your position and can defeat a premature Section 11 petition.
The unilateral-appointment objection — your strongest ground
This is the single most valuable paragraph for anyone who received a notice that already names "Mr. X, Advocate" as the sole arbitrator.
In Indian law, a party interested in the outcome of a dispute cannot appoint the sole arbitrator unilaterally, and a person who is himself ineligible to act as arbitrator cannot nominate another as arbitrator. This comes from a clear line of Supreme Court authority:
- TRF Ltd. v. Energo Engineering Projects Ltd., (2017) 8 SCC 377 — a person ineligible under Section 12(5) read with the Seventh Schedule cannot act as, nor nominate, the arbitrator.
- Perkins Eastman Architects DPC v. HSCC (India) Ltd., (2020) 20 SCC 760 (decided 26 November 2019) — a party having an interest in the dispute cannot have the sole power to appoint the sole arbitrator; such a clause is impermissible under the scheme of the Act.
- Central Organisation for Railway Electrification v. ECI-SPIC-SMO-MCML (JV) — the Constitution Bench of the Supreme Court held on 8 November 2024 that the principle of equal treatment of parties applies at all stages, including the appointment of arbitrators, and struck down unilateral-appointment arrangements as contrary to Article 14 and Section 18 of the Act.
Section 12(5) read with the Seventh Schedule makes certain persons ineligible to be arbitrators, and that ineligibility can be waived only by an express agreement in writing entered into after the dispute has arisen — never by silence and never by a pre-printed clause in the loan agreement.
So in your reply you should state, in terms: "I do not consent to the appointment of the arbitrator named in your notice. Any unilateral appointment is contrary to Perkins Eastman v. HSCC and the Constitution Bench ruling in CORE. I am willing to arrive at a consensus on a neutral, independent arbitrator, failing which the appointment must be made by the competent court under Section 11."
Silence is not consent — the 2025 Delhi High Court position
Many people assume that if they do not object, nothing bad happens. The opposite is safer to assume. In Supreme Infrastructure India Ltd. v. Freyssinet Menard India Pvt. Ltd. (Delhi High Court, O.M.P. (COMM) 395/2024, decided 5 May 2025), the Court held that a party's failure to respond to a Section 21 notice that unilaterally appointed an arbitrator does not imply consent to the named arbitrator — and it set aside the resulting award. The Court made clear that where consensus on the arbitrator fails, the only recourse is to invoke the jurisdiction of the court under Section 11 for appointment.
The takeaway cuts both ways: silence will not be read as agreement to a tainted appointment, but the clean, defensible path is still to put your objection in writing and, if needed, let the court appoint. Do not let the other side run an ex parte arbitration on the theory that you agreed.
What happens after you reply — Section 11 and the court route
If you refuse the named arbitrator and no consensus is reached within 30 days, the party wanting arbitration must apply to the High Court (or Supreme Court for international commercial arbitration) under Section 11(6) to have the court appoint an independent arbitrator. Key numbers to know:
| Point | Position under the Act / case law |
|---|---|
| When arbitration "commences" | Date the respondent receives the Section 21 request |
| Reply window (notice silent) | Reasonable time; Section 11 right to move court arises after 30 days of failure to agree |
| Who appoints if you object | The court under Section 11(6) — not the interested party |
| Limitation to file a Section 11 petition | 3 years under Article 137 of the Limitation Act, 1963 (BSNL v. Nortel Networks, (2021) 5 SCC 738) |
| Ground to challenge a unilaterally-appointed arbitrator's award | Patent illegality / against Section 12(5), under Section 34 |
If an award has already been passed by a unilaterally-appointed arbitrator, your remedy shifts to a challenge under Section 34 — see our guide on setting aside an arbitral award under Section 34. If you urgently need the other side restrained (say, from encashing a security or selling an asset) while the arbitrator is being appointed, that is a Section 9 interim-relief application.
What it costs, what documents you need, and whether you need an advocate
Cost of replying: a Section 21 reply is a letter — there is no court fee to reply. Your only cost is drafting. The expense begins if the matter reaches a Section 11 petition (court fee plus counsel's fee, which varies by High Court and by the value of the claim).
Documents to keep ready before you draft the reply:
- The arbitration notice itself and its envelope/courier tracking (to prove date of receipt).
- The underlying contract or loan agreement containing the arbitration clause (you need the exact clause wording).
- Any correspondence showing the dispute is premature, time-barred, or already settled.
What if the deadline has already passed? Reply anyway, as soon as possible, and record that your objection to the unilateral appointment stands regardless of the delay — Supreme Infrastructure confirms silence is not consent, so a late objection is still far better than none.
DIY or advocate? A short, standard credit-card/NBFC notice can often be answered by a careful litigant-in-person using the objection language above. But brief an advocate when: the claim value is large, the contract clause is complex or institutional, the notice raises limitation or jurisdiction issues, or an arbitrator has already started proceedings. Juniors drafting their first such reply should also read our note on how to verify AI-generated case citations before filing — never cite Perkins or CORE from memory; pull the primary order.
Frequently Asked Questions
Do I have to reply to a Section 21 arbitration notice?
You are not statutorily compelled to reply, but you should. Silence does not amount to consent to a unilaterally named arbitrator (Supreme Infrastructure v. Freyssinet Menard, Delhi HC 2025), yet failing to object in writing hands the other side an argument and risks an ex parte award you must then fight under Section 34. A clear written reply protects your position.
Can a bank or NBFC appoint its own arbitrator in a credit-card dispute?
No. A party interested in the dispute cannot unilaterally appoint the sole arbitrator (Perkins Eastman v. HSCC, 2019) and the Constitution Bench in CORE (8 November 2024) confirmed equal treatment applies to appointments. If an SBI Cards or NBFC notice names its own arbitrator, you should refuse consent in writing and insist on a court appointment under Section 11.
How many days do I get to reply to a Section 21 notice?
There is no fixed period in Section 21. Honour the deadline stated in the notice; if it is silent, reply within a reasonable time, treating 30 days as the outer limit — because the sender gains the right to approach the court under Section 11 only after 30 days of failure to agree on an arbitrator.
When does arbitration legally commence under Section 21?
Unless the parties agree otherwise, arbitration commences on the date the respondent receives the request to refer the dispute to arbitration — receipt, not dispatch. This date matters because it is the point at which limitation stops running for the claim.
What can I do if a unilaterally-appointed arbitrator has already passed an award against me?
Your remedy moves to a challenge under Section 34 of the Act, on the ground that the arbitrator was ineligible under Section 12(5) and the appointment violated Perkins and CORE. The Section 34 petition has a strict limitation period, so act immediately and read our dedicated guide on setting aside an award.
How Urava helps
Urava turns a Section 21 notice into a court-ready, citation-backed reply in about ten minutes. Type your question — or upload a scanned or photographed notice (including Hindi or Malayalam documents via OCR) — and Urava produces a research memorandum that pins the right provisions (Sections 21, 11, 12(5) and the Seventh Schedule) and the governing cases (TRF, Perkins Eastman, CORE, Supreme Infrastructure), with the unilateral-appointment objection drafted for your facts and every citation verified against the primary source. It is built for India's junior advocates, law students, and litigants-in-person who need an accurate first draft fast, without a ₹40,000-a-year database. Create a free Urava account and run your first researches free.