Mediation and its development in India

                                      MEDIATION AND ITS DEVELOPMENT IN INDIA

Mediation and its development in India

Author: Arnav Srivastava

Introduction-  Mediation and its development in India

Alternative Dispute Resolution (ADR) is a method for resolving conflicts outside of the conventional judicial system. The procedures used in ADR are more accommodating to the disputing parties, providing them greater freedom to choose the venue, timing, and, in some situations, the jurisdictions. 

ADR aims to reduce the number of cases filed in court, which is already overworked with many outstanding cases. Arbitration, mediation, negotiation, and Lok Adalat are examples of ADR processes used in India. One of these is mediation, which involves parties voluntarily agreeing to solve their disputes with the aid of an impartial third party (known as a mediator). 

The mediator's role is to establish a conducive environment where the parties may reconcile their disputes. There are no formal, legally enforceable guidelines for the mediation process; it mostly depends on the parties' preferences. The advantages of mediation over traditional courts include its flexibility and discretion, speed and cost-effectiveness, as well as its voluntary nature.

While Mediation is, justifiably, an increasingly popular method of dealing with disputes, in some cases, however, this mode of ADR is not ideally suited. This blog has critically analyzed the intricacies of Mediation and its development in India. 


Read the Article: What is Mediation?

Read the Article: What is Family Mediation? Mediation in Family Disputes in India


Statutory Provisions in India relating to Mediation- Mediation and its development in India

Mediations can be broadly classified into court-annexed mediation and privately arranged mediation. Cases involving family disputes and motor vehicle accidents are generally referred to court-annexed mediation. The Code of Civil Procedure 1908 (CPC) authorizes the courts to explore mediation in all civil cases. 

Section 89 of Code of Civil Procedure. 1908

The Law Commission of India in its 129th Report recommended the establishment of a conciliation court system and underlined the value of conciliation/mediation as a form of alternative dispute resolution. While it is pertinent to note that Section 89 of the CPC confers the jurisdiction of the court to refer a dispute to an ADR process, the same does not create an obligation on the courts to necessary refer the parties to ADR. Only such cases where after considering the nature of disputes, the courts seem convinced that there is a possibility of settlement can be referred to ADR.

Mediation and Conciliation Rules, 2004 

The Mediation and Conciliation Rules 2004 outlined by the Delhi High Court were brought into effect on 11.08.2005 provide the guidelines to appoint a Mediator/Conciliator and lay down the procedure involved in appropriate cases. Under the said Rule 1, any suit pending before the Delhi High Court, or any other subordinate court can be referred to the Delhi High Court Mediation & Conciliation Centre. The disputed parties have the liberty to choose the mediator from the listed panel provided by the centre, failing which, the court will appoint the mediator. 

Civil Procedure ADR and Mediation Rules. 2003 

Earlier, the concept of Mediation was dealt with particularly under the CPC 1908, incorporating Section 89(2)(d), empowering the courts to directly settle disputes by mediation. In the landmark judgment of Saleem Advocates Bar Association v. Union of India, the law commission was established for looking into the merits and loopholes to the prevailing procedure of mediation. 

With this, the committee lay down the provisions of Civil Procedure Alternate Dispute Resolution and Mediation Rules 2003 [ADR Rules]. This code provided detailed guidelines from etiquette to the procedure that needs to be followed by the Mediator. 

Arbitration And Conciliation Act, 1996

ADR is not exhaustive and it provides multiple procedures to settle the dispute outside the court system. So far, we have seen how Mediation acts as an effective method to provide a conducive environment to the disputed parties for a settlement. Next to Mediation, is Arbitration. 

The Arbitration and Conciliation Act 1996 is the act governing all the domestic as well the international commercial disputes arising in the country. The model of the Act is based on the UNICTRAL Conciliation Rules 1980. Like other ADR mechanisms, Arbitration and Conciliation also provide the disputed parties to decide how the proceedings have to be conducted, from the appointment of the arbitrator and conciliator to the jurisdiction of the court as provided under the Act. 

The act also lays down the provision for Mediation under Section 30(1) which explicitly mentions that if the parties are not able to settle their disputes through arbitration, then they have a resort to go for either Mediation, Conciliation, or any other procedure as they deem fit to in any point of time during the proceedings.  


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Commercial Courts Act 2015 & Commercial Courts (Pre-Institution Mediation and Settlement) Rules 2018

Against the backdrop of increased commercial disputes across the country, the government has introduced the Commercial Courts Act 2015 (“Act”) which specifically deals with commercial disputes that were earlier dealt with under the category of regular suits. Before this, the court's backlog of unresolved commercial concerns seriously jeopardized the perception of the Indian market system among foreign investors. Therefore, it defies the concept of business accessibility. 

Over time, there was an attempt on the part of the legislature to provide for other alternatives to settle the disputes. Therefore, in 2018, the legislature brought up an Amendment to the Commercial Courts Act 2015. The amendment introduced Section 12A (“12A”) mandating pre-institution mediation in case of a commercial dispute arising under a specified value, where interim relief is not required. However, whether this pre-institution mediation is mandatory or discretionary is a matter of debate. 

The Companies (Mediation and Conciliation) Rules 2016

The rules provide the requirements that need to be checked while appointing a mediator. The qualifications, disqualifications, time limit of completing mediation and the effect of finalization of mediation are all covered in the said rules. Moreover, the Central Government may fix the amount that has to be paid to the mediator before referring the parties to the mediation. 


Read the Article: Consumer Protection Act, 2019-Consumer Dispute Resolution through Mediation under the Consumer Protection (Mediation) Regulations, 2020

Read the Article: What is Matrimonial Mediation? What are the outcome of Matrimonial Mediation? Role of Stakeholders? What are the benefits of Matrimonial Mediation?


Development of Mediation in different States- Mediation and its development in India 

Each state in India has effectively worked for the promotion and disposal of cases through the ADR Mechanism. In their efforts to uplift the use of Mediation, they have opened numerous Mediation centres and enacted separate statutes. For example-

-Andhra Pradesh has 13 mediation centres. 

-Bihar has 16 mediation centres and has solved over 96 cases through mediation in Jan 2023. 

-Gujarat has 12 mediation centres. 

-Haryana has 17 mediation centres to date. 

-Karnataka has 30 mediation centres to date. 

Judicial support in India - Mediation and its development in India

While the legislation has brought several acts and amendments to improve the mediation process, here are some judicial pronouncements that support mediation.  

Afcons Infra Ltd v. M/S Cherian Varkey Constructions – The SC held that all commercial disputes and tortious liability can be referred to mediation.

B.S. Krishnamurthy v. B.S. Nagaraj – The SC directed the Family Courts to settle the Matrimonial Disputes via mediation. The intent was to reconcile where referring to Mediation should be the one resort. 

M/s Patil Automation Private Limited and Ors. v. Rakheja Engineers Private Ltd. – A suit is liable to be dismissed in an event of failure of pre-institutional mediation. 

Sharif-ud-din v. Abdul Gani Lone – Mediation for any commercial dispute is mandatory in nature. 

Patasibai and Ors. v. Ratanlal – Mere summons issued by a court does not mean that the option of Mediation is waived off. 

Development of Mediation in India- Mediation and its development in India 

Before the British Empire ruled India, mediation was utilized as an alternative dispute resolution (ADR). When conflicts arose, were established informal panchayats in which respected elders served as mediators. 

The Lok Adalat’s' reintroduction into the Indian judicial system catalyzed mediation's rise to prominence. The development of mediation in India can also be attributed to Section 89 of the CPC

With the efforts of Hon’ble Justice A M Ahmadi and the Institute for the Study and Development of the Legal System, the backlogs in the Judicial System were recognized and new structural and procedural reforms were reinforced, which was introduced in the form of an amendment in Section 89 of the CPC. 

Since then, judges have made substantial contributions to the growth of mediation and have worked to make it their first choice for resolving disputes. Therefore, mediation as an ADR has benefited greatly from the efforts of both the legislative and judicial branches of government.

Challenges in Mediation in India - Mediation and its development in India

The main obstacle for any party interested in mediation is the pre-existing lack of autonomy in choosing whom to contact. The parties to arbitration and conciliation procedures may choose to use ad hoc arbitrators or conciliators or engage in arbitration, conciliation or mediation under the supervision of any recognized organization. 

In addition, it should be acknowledged that potential litigants have extremely limited access to information regarding the advantages of mediation in the public domain. Mediation also lacks the bar's and the bench's active assistance and encouragement in certain aspects.

Conclusion and the way forward - Mediation and its development in India

The COVID-19 epidemic has made mediation more prevalent as a method of resolving disputes. The pandemic's abundance of cases calls for a quick and competent resolution, and mediation may be the best option. However, as was already said, several hindrances limit the efficacy of mediation. 

The current structure, which includes various mediation guidelines for several High Courts, has added to the process' element of irregularity. Therefore, passing a law specifically governing mediation would be the most crucial step toward acknowledging it as a useful instrument for conflict resolution.