MODULE - 1

MEANING OF ADR
Definition of Alternative Dispute Resolution
Alternative Dispute Resolution (ADR) is the procedure for settling disputes without litigation,
such as arbitration, mediation, or negotiation. ADR procedures are usually less costly and
more expeditious. They are increasingly being utilized in disputes that would otherwise result
in litigation, including high-profile labour disputes, divorce actions, and personal injury claims.
One of the primary reasons parties may prefer ADR proceedings is that, unlike adversarial
litigation, ADR procedures are often collaborative and allow the parties to understand each
other's positions. ADR also allows the parties to come up with more creative solutions that a
court may not be legally allowed to impose
IMPORTANT TERMS:
• Arbitration - A process similar to an informal trial where an impartial third
party hears each side of a dispute and issues a decision; the parties may
agree to have the decision be binding or non-binding
• Binding and Non-Binding - A binding decision is a ruling that the parties
must abide by whether or not they agree with it; a non-binding decision is
a ruling that the parties may choose to ignore
• Arbitrator - An impartial person given the power to resolve a dispute by
hearing each side and coming to decision
• Hearing- A proceeding in which evidence and arguments are presented,
usually to a decision-maker who will issue ruling
• Mediation - A collaborative process where a mediator works with the
parties to come to a mutually agreeable solution; mediation is usually nonbinding

HISTORY
The development of Alternative Dispute Resolution (ADR) in India has roots dating back to
ancient times, where the Panchayat system served as an early form of ADR. During the Vedic
Ages, villages were governed by Panchayats, which resolved disputes peacefully. Similarly,
arbitration has a long history in India, with ancient civilizations promoting settlement by
chosen tribunals.
With British influence, ADR instances were seen through legislation like the Bengal Regulation
Act, 1772, and the Regulation Act, 1781, which encouraged arbitration. The Code of Civil
Procedure in 1859 provided for arbitration without court intervention. Post-independence,
the Constitution of India included arbitration under Entry 13 of the Concurrent List.
India became a signatory to the New York Convention, leading to the Foreign Awards
(Recognition and Enforcement) Act, 1961. However, the Arbitration Act of 1940 had
shortcomings, prompting the enactment of the Arbitration and Conciliation Act, 1996, post-
liberalization. This Act introduced concepts like conciliation and minimized judicial
intervention in arbitration agreements, aligning with international standards.
The current legislation is codified based on the Model Arbitral Law (MAL) on International
Commercial Arbitration by UNCITRAL, ensuring conformity with international norms. Judicial
decisions like in Advocates Bar Association v. Union of India affirmed the importance of ADR
and directed the formulation of rules for its operation. Additionally, in Babar Ali v. Union of
India and Kalpana Kothari v. Sudha Yadav, the Supreme Court upheld the constitutionality of
the Act and emphasized the primacy of arbitration clauses in contracts, discouraging recourse
to civil courts without initiating arbitration proceedings.

Formal and Informal Advantages and Disadvantages of ADR:

Advantages:
1. Reduced Time in Dispute: ADR processes typically reach a final decision more quickly
than traditional litigation.
2. Reduced Costs: ADR is generally less expensive than litigation, saving parties money.
3. Flexibility: Parties have more freedom to choose the rules and procedures that will be
applied to their dispute.
4. High Settlement Rates: ADR processes often result in settlement rates of up to 85
percent.
5. Improved Satisfaction: Parties tend to be more satisfied with the outcome or manner
in which the dispute is resolved through ADR.
6. Increased Compliance: Parties are more likely to comply with agreed solutions
reached through ADR.
7. Single Procedure: ADR allows parties to resolve multiple disputes involving
intellectual property or other matters in a single procedure.
8. Party Autonomy: ADR affords parties greater control over the resolution process,
including the selection of decision-makers, applicable law, and procedures.
9. Neutrality: ADR is neutral to the law, language, and institutional culture of the parties,
avoiding any bias present in court-based litigation.
10. Confidentiality: ADR proceedings are private, allowing parties to keep actions
confidential and focus on the merits of the dispute.
 11. Finality of Awards: Arbitral awards are generally not subject to appeal, providing
finality to the resolution.
12. Enforceability of Awards: Arbitral awards are recognized and enforceable across
borders, facilitating enforcement.
13. Preservation of Relationships: ADR promotes cooperation and preserves
relationships by avoiding a winner-takes-all outcome.
Disadvantages:
1. Stalling Tactics: ADR can be used as a tactic to delay resolution of the dispute.
2. Voluntary Participation: Parties are not compelled to continue negotiations or
mediation, leading to potential impasse.
3. Lack of Legal Precedents: ADR does not create legal precedents, potentially
weakening future legal positions.
4. Exclusion of Pertinent Parties: Exclusion of relevant parties may weaken the final
agreement.
5. Limited Bargaining Power: Parties may have limited bargaining power in ADR
processes.
6. Power Imbalances: ADR may not adequately address power imbalances between
parties.
7. Limited Protection of Legal Rights: ADR may not fully protect parties' legal rights
compared to litigation.
8. Scope Limitations: ADR may not be suitable for all types of disputes, particularly those
requiring injunctive relief.
9. Limits to Discovery Process: ADR may lack the extensive discovery process available
in litigation, potentially affecting evidence gathering.
10. No Guaranteed Resolution: ADR processes do not always lead to a resolution of the
dispute.
11. Finality of Arbitration Decisions: Arbitration decisions are generally final and not
subject to appeal, unlike court decisions.
12. Perceived Weakness: Participation in ADR may be perceived as a sign of weakness by
some parties.
13. Fit for Certain Cases: ADR may not be suitable for all types of disputes, particularly
those requiring injunctive relief or involving complex legal issues.

LEGISLATIVE AND JUDICIAL SANCTION FOR ALTERNATIVE DISPUTE RESOLUTION

Legislative and judicial sanction for Alternative Dispute Resolution (ADR) in India signifies the
recognition and support provided by both legislative bodies and the judiciary to promote the
use of ADR mechanisms for dispute resolution. Here's how legislative and judicial bodies
contribute to the sanctioning of ADR:

Legislative Support:
Enactment of ADR Laws: Legislatures enact laws that specifically recognize and regulate ADR
processes such as arbitration, mediation, and conciliation. For example, in India, the
Arbitration and Conciliation Act, 1996, provides a legal framework for arbitration and
conciliation.
Promotion of ADR Mechanisms: Legislatures may actively promote the use of ADR
mechanisms by incorporating provisions in statutes encouraging parties to resolve disputes
through ADR before approaching formal judicial forums.
Creation of ADR Institutions: Legislative bodies may establish specialized ADR institutions or
bodies to facilitate ADR processes and administer disputes efficiently. These institutions help
in institutionalizing ADR and ensuring its effectiveness.

Judicial Support:
Recognition of ADR Agreements: Courts recognize and enforce agreements between parties
to resolve disputes through ADR mechanisms. Judicial authorities uphold the validity of
arbitration clauses in contracts and enforce the parties' choice to opt for ADR.
Referral to ADR: Judges have the authority to refer parties to ADR processes voluntarily or
mandatorily as part of case management. Courts encourage parties to explore ADR options
before proceeding with litigation, promoting the timely and cost-effective resolution of
disputes.
Judicial Oversight: While respecting the autonomy of ADR proceedings, courts provide
necessary oversight to ensure fairness and adherence to legal principles. Judicial intervention
may be sought in cases of procedural irregularities, bias, or challenges to the enforceability of
ADR awards.
Overall, legislative and judicial sanction for ADR reflects a coordinated effort to integrate ADR
into the legal system, providing parties with alternative avenues for resolving disputes and
alleviating the burden on traditional court systems.

Types of Dispute Resolution Mechanisms:

1. Ad Hoc Arbitration:
• Definition: Ad hoc arbitration is not administered by an institution, allowing
parties to determine all aspects of the arbitration themselves.
 • Characteristics:
• Parties decide on the number of arbitrators, manner of their
appointment, etc.
• Can be more flexible, cheaper, and faster than administered
proceedings if parties cooperate.
• Ground Realities in India: Ad hoc arbitration in India is becoming relatively
expensive compared to traditional litigation.
2. Institutional Arbitration:
• Definition: Institutional arbitration involves a specialized institution aiding and
administering the arbitral process according to its rules.
• Characteristics:
• Arbitrators arbitrate, while the institution administers the process.
• Incorporates the institution's rules into the arbitration agreement.
• Recognized globally for resolving international commercial disputes.
• Experienced panels often scrutinize awards, minimizing the chances of
court intervention.
3. Statutory Arbitration:
• Definition: When a law mandates arbitration for specific disputes, it is termed
statutory arbitration.
• Characteristics:
• Governed by the Arbitration and Conciliation Act, 1996, except for
specific provisions.
• Applies to disputes under any other Indian law mandating arbitration.
4. Fast Track Arbitration:
• Definition: Fast track arbitration is a time-bound process with stricter
procedural rules to expedite resolution.
• Characteristics:
• Allows parties to agree on procedures for appointing arbitrators and
challenging awards quickly.
• Facilitates quicker resolution and cost-effectiveness, particularly under
the Indian Council of Arbitration's rules.
5. Mediation:
 • Definition: Mediation involves a neutral third party assisting disputing parties
in reaching a mutually acceptable solution.
• Characteristics:
• Mediator facilitates negotiation but lacks the power to impose
outcomes.
• Altering negotiation dynamics without formal enforcement by courts.
• Historically evident in Indian systems like Village and Nyaya Panchayats
but underutilized in modern legal practice.
6. Conciliation:
• Definition: Conciliation involves a neutral third-party facilitating
communication between disputing parties to encourage a settlement.
• Characteristics:
• Typically occurs before litigation or arbitration, focusing on reconciling
differences.
• Encouraged by the Arbitration and Conciliation Act, 1996, for resolving
contractual and non-contractual disputes.
7. Negotiation:
• Definition: Negotiation involves direct communication between parties to
resolve disputes without third-party intervention.
• Characteristics:
• Parties retain control over the process and outcomes.
• Not statutorily recognized in India but commonly used as a non-
binding, voluntary process.
8. Lok Adalats:
• Definition: Lok Adalats are alternative dispute resolution forums in India
established under the Legal Services Authorities Act, 1987.
• Characteristics:
• Aim to provide free legal services and expedite justice for weaker
sections of society.
• Statutorily recognized, with settlements having the force of a decree.
• Operate under the auspices of state legal aid and advice boards, with
provisions for referral of cases.
MODULE – 2

MEDIATION:

Mediation in India is a voluntary process where the disputing people decide to mutually
find a solution to their legal problem by entering into a written contract and appointing a
mediator. The decision-making powers remain with the disputing parties, with the mediator
acting as a buffer to bring them to an understanding. The parties can hire ADR lawyers to
represent them before the mediator and explain the situation in a professional way. The
difference between arbitration and mediation are that arbitration is a more formal process
than mediation. An arbitrator needs to be formally appointed either beforehand or at the
time of need. A mediator can be anyone, of any designation, can be appointed formally or
casually depends on the wish of the parties. The mediation law in India has been made user
friendly and pretty flexible. Mediation India are divided into two categories which are
commonly followed:

1. Court referred Mediation: The court may refer a pending case for mediation in India
under Section 89 of the Code of Civil Procedure, 1908. This type of mediation is frequently
used in Matrimonial disputes, particularly divorce cases.

2. Private Mediation: In Private Mediation, qualified personnel works as mediators on a

fixed-fee basis. Anyone from courts, to the general public, to corporates as well as the
government sector, can appoint mediators to resolve their dispute through mediation.

Mediation:

• Definition: A voluntary, confidential process where a neutral third party (mediator)

helps parties in dispute reach a mutually acceptable agreement.

• History: Ancient roots in various cultures; modern formalization emerged in the 20th
century as an alternative dispute resolution method.

• Techniques:

1. Active Listening: Mediators listen attentively to parties' perspectives without

judgment.
 2. Facilitative Approach: Encourages open communication, brainstorming, and
creative problem-solving.

3. Reality Testing: Helps parties understand the strengths and weaknesses of

their positions.

4. Shuttle Diplomacy: Mediator communicates separately with each party to

convey offers and proposals.

• Role of Mediator: Facilitates communication, maintains neutrality, assists in

identifying issues, explores options, and helps parties reach a voluntary agreement.

Conciliation:

• Definition: Similar to mediation but often used in international disputes; involves a

third-party conciliator facilitating communication and negotiation between disputing
parties.

• Difference from Mediation: Conciliators may offer non-binding recommendations or

settlements.

• Techniques:

1. Fact-Finding: Conciliator gathers information about the dispute and parties'

positions.

2. Proposal Formulation: Suggests potential solutions or compromises to bridge

gaps.

3. Emotional Management: Addresses underlying emotions that hinder

resolution.

• Role of Conciliator: Acts as a neutral intermediary, assists in communication,

explores options, and facilitates agreement.

Conciliation Process in India:

• Legal Framework: Governed by various statutes and laws, including the Arbitration
and Conciliation Act.
 • Institutional Support: Conciliation centers established by legal bodies and
institutions to facilitate conciliation processes.

• Procedures: Parties voluntarily submit to the conciliation process, conciliator assists

in negotiations, and any resulting agreement can be enforced as per legal provisions.

Negotiation:

• Concept: A fundamental process in dispute resolution involving direct

communication and bargaining between parties to reach a mutually acceptable
outcome.

• Process: Involves preparation, discussion, proposal, bargaining, and agreement.

• Techniques:

1. BATNA (Best Alternative to a Negotiated Agreement): Identifying the best

course of action if negotiation fails.

2. ZOPA (Zone of Possible Agreement): Finding the range within which an

agreement is possible.

3. Interest-Based Negotiation: Focusing on underlying needs and interests

rather than fixed positions.

• Role: Parties negotiate directly, with or without representation, to achieve their

objectives within legal and ethical boundaries.

Section 2: Application

• Scope: The Act applies to mediation conducted in India under various conditions.

• Conditions for Application:

• Residency or Incorporation: Applies if all or both parties habitually reside in,

are incorporated in, or have their place of business in India.

• Mediation Agreement: Applies if the mediation agreement stipulates

resolution according to this Act.
 • International Mediation: Applies to international mediations involving at
least one party outside India.

• Government Parties: Applies when one party is the Central Government,

State Government, or related entities in commercial disputes.

• Other Disputes: Applies to other disputes deemed appropriate by the Central

or State Government for mediation.

Section 3: Definitions

• Commercial Dispute: Defined as per the Commercial Courts Act, 2015.

• Community Mediator: Mediator for community mediation under Chapter X.

• Council: Refers to the Mediation Council of India established under section 31.

• Court: Competent court in India having jurisdiction over the subject matter of
mediation.

• Court-Annexed Mediation: Mediation conducted at mediation centers established

by courts.

• Institutional Mediation: Mediation under a mediation service provider.

• International Mediation: Involves commercial disputes with international aspects.

• Mediation: Process where parties attempt to reach settlement with a mediator's

assistance.

• Mediator: Appointed person facilitating mediation, including those registered with

the Council.

• Mediation Agreement: Agreement mentioned in section 4.

• Mediation Communication: Communication made during mediation.

• Mediation Institute: Organization providing mediator training and certification.

• Mediation Service Provider: Provider mentioned in section 40.

• Mediated Settlement Agreement: Agreement mentioned in section 19.

 • Member: Full-Time or Part-Time Member of the Council.

• Notification: Official Gazette publication.

• Online Mediation: Mediation conducted online as per section 30.

• Participants: Persons other than parties involved in mediation.

• Party: Involved party whose consent is necessary for dispute resolution.

• Place of Business: Defined extensively to include various business-related locations.

• Pre-litigation Mediation: Mediation undertaken before filing civil or commercial

suits.

• Prescribed: Determined by rules made by the Central Government.

• Schedule: Refers to the Schedule annexed to the Act.

• Secure Electronic Signature: Defined with reference to online mediation.

• Specified: Determined by regulations made by the Council.

Section 4: Mediation Agreement

• Form of Agreement:

• Agreement to submit to mediation disputes, either all or certain, in writing.

• Can be in the form of a clause within a contract or as a separate agreement.

• Requirements for a Written Agreement:

• Signed document by the parties.

• Communication exchange including electronic forms.

• Mention in pleadings or other proceedings where not denied.

• Reference in Agreements: Any agreement with a mediation clause constitutes a

mediation agreement if in writing.

• Scope of Agreement:
 • Parties can agree to mediate disputes arising under prior or subsequent
agreements.

• International Mediation: Refers to resolution of commercial disputes mentioned in

section 3.

Section 5: Pre-litigation Mediation

• Voluntary Settlement Attempts: Parties can engage in pre-litigation mediation

before filing suits or proceedings.

• Commercial Disputes: Specified value commercial disputes regulated by the

Commercial Courts Act, 2015.

• Applicability to Tribunals: Provisions also applicable to notified tribunals by Central

or State Governments.

• Mediator Selection: Parties can select mediators registered with the Council or
empanelled by relevant authorities.

• Mediator Panels: Courts and legal service authorities maintain panels of mediators.

• Mediation in Accident Cases: Claims Tribunals can refer parties for mediation in
compensation disputes arising from accidents.

• Settlement Process: Settlement agreements reached in mediation presented to the

Tribunal for consideration.

Section 6: Limitations on Mediation

• Excluded Disputes: Mediation not conducted for disputes listed in the First Schedule.

• Exceptions:

• Courts can still refer compoundable offenses, including certain matrimonial

offenses, to mediation.

• Outcome not considered as a court judgment or decree unless further

reviewed by the court.
 • Amendments to Schedule: Central Government can amend the First Schedule by
notification.

Section 7: Court or Tribunal Referral

• Court Referral: Courts or tribunals can refer parties to mediation at any stage of
proceedings.

• Interim Orders: Courts may issue interim orders to protect the interests of parties
during mediation.

• No Obligation to Settle: Parties not obligated to reach a settlement through court-

referred mediation.

Section 8: Appointment of Mediators

• Nationality: Any nationality can be appointed unless otherwise agreed upon.

• Qualifications for Foreign Mediators: Foreign mediators must possess specified

qualifications, experience, and accreditation.

• Agreement on Mediator and Procedure:

• Parties are free to agree on the mediator's name and appointment

procedure.

• If no agreement, the party initiating mediation applies to the mediation

service provider for mediator appointment.

• Mediator Appointment:

• Mediation service provider appoints:

• Agreed mediator.

• If no agreement or agreed mediator refuses, a mediator from their

panel with consent.

Section 9: Consideration of Suitability

• Mediation Service Provider's Role: Considers mediator's suitability and parties'

preferences for dispute resolution.
Section 10: Conflict of Interest and Disclosure

• Pre-Mediation Disclosure: Mediator discloses any potential conflicts of interest in

writing to the parties.

• Ongoing Disclosure: Any newly arisen conflict of interest during mediation is

promptly disclosed.

• Option to Waive Objections: Parties may waive objections if all express consent in
writing.

• Replacement of Mediator:

• Institutional Mediation: Party applies to terminate mediator's mandate.

• Other Mediation: Party terminates mediator's mandate.

Section 11: Termination of Mediator's Mandate

• Grounds for Termination:

• Application from a party.

• Information about mediator's conflict of interest.

• Mediator's withdrawal from mediation.

• Procedure:

• Hearing provided if termination is due to doubts about mediator's

independence or impartiality.

• Mediation service provider appoints another mediator if needed.

Section 12: Replacement of Mediator

• After Termination:

• Non-institutional mediation: Parties appoint another mediator within seven

days.

• Termination under section 11: Mediation service provider appoints another

mediator within seven days.
Section 13: Territorial Jurisdiction

• Location of Mediation: Generally within the jurisdiction of the court or tribunal.

• Exception: Mediation can occur outside jurisdiction or online with mutual consent.

• Enforcement Clarification: Agreements reached outside jurisdiction are enforceable

within jurisdiction.

Section 14: Commencement of Mediation

• Initiation:

• Agreement to mediate: When a party receives notice to refer the dispute to

mediation.

• Appointment of mediator: When the chosen mediator consents or is

appointed.

Section 15: Conduct of Mediation

• Process Specification: Mediation is conducted as specified.

• Role of Mediator:

• Independent, neutral, and impartial facilitator.

• Guided by principles of objectivity, fairness, and confidentiality.

• Conducts meetings as deemed fit for an orderly process.

Section 16: Facilitation by Mediator

• Objective: Facilitate voluntary resolution.

• No Imposition of Settlement: Mediator facilitates decisions but does not impose

settlements.

Section 17: Limitations on Mediator

• Restrictions: Mediator cannot act as arbitrator or witness in related proceedings.

Section 18: Time Limit for Mediation

 • Completion Period: Mediation to be completed within 120 days.

• Extension: Extendable by mutual agreement for a maximum of 60 days.

Section 19: Mediated Settlement Agreement

• Definition: Written agreement settling disputes resulting from mediation.

• Form: Authenticated by mediator and signed by parties.

• Submission: Submitted to mediator for institutional mediation or directly to parties.

Section 20: Registration of Agreement

• Optional Registration: Agreement can be registered with specified authority for

record.

• Time Limit: Registration within 180 days, extendable with fee.

Section 21: Non-Settlement Report

• Submission: Mediator submits non-settlement report to provider or parties if

mediation unsuccessful.

Section 22: Confidentiality

• Matters Kept Confidential: Mediation proceedings details are confidential, including

discussions, documents, and communications.

• No Recording: Parties cannot make or maintain audio or video recordings of

mediation.

• Non-Admissibility: Information from mediation cannot be used as evidence in court

or arbitration proceedings.

• Exceptions: Mediator can disclose general information for research, reporting, or

training.

• Exemption: Mediated settlement agreement disclosure allowed for registration,

enforcement, and challenge purposes.

Section 23: Privilege Against Disclosure

 • Non-Disclosure: Mediators and participants cannot disclose mediation
communications or contents to courts or tribunals.

• Exclusions: No privilege for plans to commit offenses, domestic violence or child

abuse information, or threats to public health or safety.

Section 24: Termination of Mediation

• Termination Events: Mediation ends on agreement signing, mediator's declaration,

party's opt-out communication, or expiry of time limit.

Section 25: Cost of Mediation

• Cost Determination: Specified cost for mediation, usually shared equally among
parties.

Section 26: Exclusion from Lok Adalat Proceedings

• Exclusion: This Act doesn't apply to proceedings in Lok Adalat and Permanent Lok
Adalat under the Legal Services Authorities Act, 1987.

Section 27: Enforcement of Mediated Settlement Agreement

• Finality and Binding: A mediated settlement agreement, signed and authenticated

by the mediator, is final, binding, and enforceable.

• Enforcement Procedure: It is enforced like a court judgment or decree under the

Code of Civil Procedure, 1908.

Section 28: Challenge to Mediated Settlement Agreement

• Filing Challenge: Parties can challenge a mediated settlement agreement in court or

tribunal.

• Grounds for Challenge: Challenges can be based on fraud, corruption,

impersonation, or if the mediation was conducted in unsuitable disputes.

• Time Limit for Challenge: Application for challenge must be made within ninety days
of receiving the mediated settlement agreement, with a provision for extension
under certain circumstances.
Section 29: Limitation Period Exclusion

• Exclusion from Limitation Period: Time during mediation, from its commencement
to submission of report or termination, is excluded from computing the limitation
period for related proceedings.

Section 30: Online Mediation

• Permissible Scope: Online mediation, including pre-litigation mediation, can occur at

any stage of the mediation process with parties' written consent.
• Methods of Conduct: It can utilize various electronic forms or computer networks
such as encrypted emails, secure chat rooms, or video/audio conferencing.
• Process Specification: The online mediation process is outlined based on specified
guidelines.
• Integrity and Confidentiality: Measures are taken to maintain the integrity and
confidentiality of proceedings, with the mediator empowered to ensure this.

Section 31: Establishment of Mediation Council of India

• Establishment: The Central Government creates the Mediation Council of India via
official notification.
• Legal Entity: The Council is a body corporate, possessing perpetual succession, a
common seal, and legal capacities.
• Powers: Empowered to acquire, manage, and dispose of property, as well as enter
into contracts.
• Headquarters: Initially headquartered in Delhi, with the option to establish offices
across India and abroad.

Section 32: Composition of the Council

• Members: The Council consists of:

• Chairperson: Appointed by the Central Government, possessing expertise in law or
mediation.
• Various Members: Experts in law, mediation, research, or teaching, appointed by the
Central Government.
 • Ex Officio Members: Government officials, including the Secretaries to the
Departments of Legal Affairs and Expenditure.
• Part-Time Member: Represents recognized bodies of commerce and industry,
chosen by the Central Government.
• Term: Non-ex officio Members serve for four years, with reappointment possible but
subject to age restrictions.
• Remuneration: Salaries, allowances, and other terms determined for non-ex officio
Members.

Section 33: Validity of Council Proceedings

• Validity Assurance: No proceedings are invalidated due to vacancies, defects in

appointment, or procedural irregularities not affecting the case's substance.

Section 34: Resignation

• Resignation Procedure: Members can resign from their position by providing written
notice to the Central Government.
• Tenure Continuation: Unless permitted to leave earlier, Members continue their
roles until a successor is appointed or their term expires.

Section 35: Removal of Members

• Grounds for Removal: Members may be removed if they:

• Are an undischarged insolvent.
• Engage in unauthorized paid employment.
• Are convicted of an offense involving moral turpitude.
• Acquire interests likely to prejudice their functions.
• Abuse their position, endangering public interest.
• Become physically or mentally incapable of performing duties.
• Procedure: Members receive notice of charges and an opportunity to respond
before removal.

Section 36: Appointment of Experts and Committees

 • Authority: The Council can appoint experts and form committees as needed to fulfill
its functions.
• Terms: Terms and conditions for these appointments are specified as required.

Section 37: Secretariat and Chief Executive Officer

• Administrative Head: The Council appoints a Chief Executive Officer responsible for
day-to-day administration and implementation of decisions.
• Support Staff: A Secretariat, comprising officers and employees, assists in Council
operations.
• Central Government Support: Necessary officers and employees are provided by the
Central Government until regulations are formulated under this section.

Section 38: Duties and Functions

• Promotion of Mediation: Endeavors to promote domestic and international

mediation through guidelines and development initiatives.
• Regulation: Sets guidelines for mediator education, conduct, and certification, as
well as standards for mediation proceedings.
• Recognition: Recognizes mediation institutes and service providers, specifying
criteria for recognition and laying down professional and ethical standards.
• Training and Collaboration: Conducts training, workshops, and collaborations in
mediation.
• Information Management: Maintains an electronic depository of mediated
settlement agreements and other related records.
• Reporting: Prepares and submits implementation reports to the Central Government
at specified intervals.
• Supplementary Measures: Receives additional measures from the Central
Government to enhance its functioning and the Act's implementation.

Section 40: Mediation Service Providers

• Definition: Defines "mediation service provider" to include various entities

facilitating mediation.
 • Inclusion: Entities recognized by the Mediation Council, Legal Services Authorities,
court-annexed mediation centers, or notified by the Central Government.

• Recognition: Mediation service providers must be recognized by the Mediation

Council as per specified procedures.

Section 41: Functions of Mediation Service Providers

• Accreditation: Accredit mediators and maintain a panel of qualified mediators.

• Mediation Services: Provide mediator services, facilities, and infrastructure for

efficient mediation.

• Promotion: Promote professional and ethical conduct among mediators.

• Facilitation: Assist in the registration of mediated settlement agreements.

• Other Functions: Perform any other functions specified under the Act.

Section 42: Recognition of Mediation Institutes

• Authority: The Mediation Council recognizes mediation institutes to perform

specified duties and functions.

• Scope: Institutes designated by the Council fulfill roles assigned by the Act.

Section 43: Community Mediation

• Scope: Disputes affecting peace, harmony, and tranquility among residents can be
settled through community mediation with mutual consent.

• Application: Parties apply to the concerned Authority or Magistrate for mediation

referral.

• Panel Formation: Authorities constitute a panel of three community mediators for

dispute resolution.

• Inclusion: Panel members comprise respected individuals from the community and
those experienced in mediation.

• Representation: Consideration of diversity, including gender and other relevant

factors, in panel formation.
Section 44: Procedure for Community Mediation

• Mediation Process: Conducted by the panel of three community mediators who

devise suitable procedures.

• Dispute Resolution: Mediators aim to resolve disputes amicably and assist parties in
reaching agreements.

• Documentation: Settlement agreements are documented and authenticated by

mediators, with copies provided to parties.

• Non-Settlement Report: If no agreement is reached, mediators submit a non-

settlement report to the relevant authority and parties.

• Enforceability: Settlement agreements are not enforceable as civil court judgments

but serve to maintain peace and harmony.

• Registration: Settlement agreements are registered following the provisions of

Section 20, mutatis mutandis.
MODULE – 3

➢ PROVISIONS UNDER THE CPC, 1908

Section 89 of the Civil Procedure Code (CPC) in India provides for the settlement of
disputes outside of traditional court litigation through Alternative Dispute Resolution
(ADR) mechanisms. It encourages parties to explore ADR methods before proceeding
with litigation, thereby promoting faster and more cost-effective resolution of disputes.
Here's an explanation of Section 89 of the CPC with respect to ADR:
1. Scope and Application: Section 89 applies to all civil suits pending before a court at
any stage of the proceedings. It covers a wide range of disputes, including those
related to property, contracts, family matters, and more.
2. Reference to ADR Methods: When the court finds that the case is suitable for ADR, it
may direct the parties to explore methods such as mediation, conciliation,
arbitration, or Lok Adalat (a form of people's court in India). The court may make this
suggestion at any stage of the proceedings, including at the first hearing.
3. Benefits of ADR: Section 89 emphasizes the benefits of ADR, including its potential
to reduce the burden on courts, save time and costs, and promote amicable
settlements between parties. By encouraging parties to resolve disputes through
ADR, the section aims to alleviate the backlog of cases in the judicial system and
promote access to justice.
4. Conciliation and Settlement: If the parties agree to pursue conciliation, the court
may refer them to a conciliator chosen by mutual consent. The conciliator facilitates
communication and negotiation between the parties to reach a mutually acceptable
settlement. Once a settlement is reached, it is binding on the parties and can be
enforced as a decree of the court.
5. Arbitration: If the parties agree to arbitration, they may opt for either ad hoc
arbitration or institutional arbitration. Ad hoc arbitration involves the parties
determining the arbitration process themselves, while institutional arbitration is
administered by a specialized institution according to its rules. The arbitrator's
decision, known as an arbitral award, is final and binding on the parties.
6. Mediation: Mediation involves a neutral third party, known as a mediator, assisting
the parties in resolving their disputes amicably. The mediator does not impose a
decision but facilitates communication and negotiation between the parties. If the
parties reach a settlement through mediation, it is recorded and binding on them.
7. Lok Adalat: Lok Adalats are informal dispute resolution forums where disputes are
settled expeditiously and amicably. They operate under the auspices of the Legal
Services Authorities Act and focus on resolving disputes through conciliation and
negotiation. Settlements reached in Lok Adalats are final and binding on the parties.
In summary, Section 89 of the CPC provides a framework for courts to refer civil disputes to
ADR methods such as mediation, conciliation, arbitration, and Lok Adalat. By promoting
ADR, the section aims to facilitate faster, cost-effective, and amicable resolution of disputes
while reducing the burden on the traditional judicial system.
• Salem Advocate Bar Association v. Union of India and Another (2003),
the Supreme Court of India emphasized the importance of Alternative Dispute Resolution
(ADR) mechanisms in easing the burden on the judicial system. The Court held that Section
89 of the Civil Procedure Code (CPC) provides for the mandatory consideration of ADR
methods before proceeding with litigation. It stressed that ADR methods such as mediation,
conciliation, and arbitration should be encouraged to promote faster and more efficient
dispute resolution.
• Afcons Infrastructure Ltd. v. Cherian Varkey Construction Co. (2010), the Supreme
Court reiterated the significance of ADR and upheld the mandatory provisions of
Section 89 CPC. The Court emphasized the need for courts to actively encourage
parties to explore ADR options and only resort to traditional litigation as a last resort.

➢ THE INDUSTRIAL DISPUTES ACT, 1947

The Industrial Disputes Act, 1947, governs industrial relations and provides for mechanisms
to resolve disputes between employers and employees. Here's an explanation of Sections 7,
18, 10(a), and 33A of the Industrial Disputes Act with respect to Alternative Dispute
Resolution (ADR):
1. Section 7:
• This section deals with the reference of disputes to arbitration.
• It empowers the appropriate government to refer industrial disputes to
arbitration if it deems it necessary.
• ADR mechanisms like arbitration can be utilized under this section to resolve
disputes outside the traditional judicial process.
• Arbitration can provide a more expedited and cost-effective resolution
compared to litigation in court.
2. Section 18:
• Section 18 allows for voluntary arbitration.
• It empowers the parties involved in an industrial dispute to agree to refer the
dispute to arbitration voluntarily.
• This provision encourages parties to resolve their disputes amicably through
arbitration without the need for formal intervention by the government or
the courts.
 • Voluntary arbitration can be an effective form of ADR, as it allows the parties
to maintain control over the dispute resolution process.
3. Section 10(a):
• Section 10(a) deals with the power of the government to refer disputes to
boards for adjudication.
• It provides for the constitution of a board of conciliation by the appropriate
government to mediate and settle disputes between employers and
employees.
• Conciliation is a form of ADR where a neutral third party assists the parties in
reaching a mutually acceptable agreement.
• By referring disputes to conciliation boards, Section 10(a) promotes the use
of ADR mechanisms to resolve industrial disputes without resorting to formal
litigation.
4. Section 33A:
• Section 33A was inserted into the Industrial Disputes Act to provide for pre-
litigation conciliation.
• It requires parties to an industrial dispute to give notice of the dispute to the
concerned authority and attempt conciliation before resorting to a strike or
lockout.
• This section emphasizes the importance of ADR, particularly conciliation, as a
means of preventing industrial unrest and promoting peaceful resolution of
disputes.
• By mandating pre-litigation conciliation, Section 33A encourages parties to
explore ADR options before taking more drastic measures such as strikes or
lockouts, thereby fostering a conducive environment for dispute resolution.

➢ COMMERCIAL COURTS ACT, 2015

In the Commercial Courts Act, 2015, Sections 2(1)(i) and 12(a) play important roles in
facilitating Alternative Dispute Resolution (ADR) methods. Here's an explanation of these
sections concerning ADR:

Section 2(1)(i):

• This section provides the definition of a "commercial dispute" under the Commercial
Courts Act, 2015.
• Section 2(1)(i) defines a commercial dispute as a dispute arising out of transactions
between merchants, bankers, financiers, traders, etc.
• It also includes disputes relating to agreements, contracts, and other commercial
dealings.
• The broad scope of this definition encompasses a wide range of commercial activities
and transactions, making it applicable to various types of disputes that may arise in the
commercial realm.
• ADR mechanisms can be particularly beneficial in resolving commercial disputes
efficiently and effectively, given their often technical and specialized nature.

Section 12(a):

• Section 12(a) of the Commercial Courts Act, 2015, pertains to the jurisdiction of
commercial courts.
• It grants commercial courts jurisdiction over commercial disputes of a specified
value, as prescribed by the government.
• However, it also provides an important exception, stating that commercial courts
shall not have jurisdiction over disputes where the parties have agreed to submit
their disputes to arbitration or any other ADR mechanism.
• This provision reflects the legislative intent to promote ADR methods such as
arbitration, mediation, or conciliation for resolving commercial disputes.
• By excluding disputes subject to ADR agreements from the jurisdiction of commercial
courts, Section 12(a) encourages parties to opt for ADR mechanisms voluntarily
agreed upon, thereby reducing the burden on the court system and promoting the
timely and efficient resolution of disputes.
• It underscores the policy objective of encouraging parties to resort to ADR methods
for resolving their commercial disputes, recognizing the benefits of such mechanisms
in terms of flexibility, confidentiality, and expertise in commercial matters.

➢ CONSUMER PROTECTION ACT

Sections 74 to 81 of the Consumer Protection Act deal with the mediation and alternative
dispute resolution (ADR) mechanisms available for resolving consumer disputes. Here's an
explanation of these sections concerning mediation and ADR:
1. Section 74 - Mediation:
• Section 74 provides for the establishment of mediation cells at the district,
state, and national levels to promote mediation as a mode of dispute
resolution.
• These mediation cells aim to facilitate the settlement of disputes between
consumers and businesses through mutual agreement, with the assistance of
a mediator.
 • The Act empowers the appropriate government to notify these mediation
cells and prescribe their functions and procedures.
2. Section 75 - Reference to Mediation:
• Section 75 allows the consumer commission, upon receipt of a complaint, to
refer the parties to mediation if it deems fit.
• The commission may refer the matter to mediation either on its own motion
or at the request of one or both parties involved in the dispute.
• This provision highlights the emphasis on resolving consumer disputes
amicably through mediation before resorting to formal adjudication.
3. Section 76 - Appointment of Mediator:
• Section 76 empowers the consumer commission to appoint a qualified and
experienced mediator to facilitate the mediation process.
• The mediator's role is to assist the parties in reaching a mutually acceptable
settlement of their dispute through dialogue and negotiation.
4. Section 77 - Confidentiality of Proceedings:
• Section 77 mandates that the mediation proceedings shall be conducted in a
confidential manner.
• The mediator and the parties involved in the mediation process are required
to maintain confidentiality regarding the discussions, proposals, and
documents exchanged during mediation.
5. Section 78 - Settlement Agreement:
• Section 78 states that if the parties reach a settlement through mediation,
the mediator shall prepare a settlement agreement embodying the terms
agreed upon by the parties.
• The settlement agreement is binding on the parties and enforceable as an
order of the consumer commission.
6. Sections 79 to 81 - Other Provisions:
• Sections 79 to 81 contain miscellaneous provisions related to mediation,
including the admissibility of settlement agreements as evidence, the power
of the consumer commission to pass orders based on settlement
agreements, and the procedure for referring cases to mediation.
Overall, these sections of the Consumer Protection Act emphasize the promotion and
facilitation of mediation as an effective means of resolving consumer disputes in a timely,
cost-effective, and amicable manner, thereby reducing the burden on consumer
commissions and promoting consumer welfare.
➢ REAL ESTATE (REGULATION AND DEVELOPMENT) ACT, 2016 (RERA)
Section 32(g) of the Real Estate (Regulation and Development) Act, 2016 (RERA) pertains to
the functions of the Real Estate Regulatory Authority (RERA) with respect to alternative
dispute resolution (ADR). Here's an explanation of Section 32(g) in the context of ADR:
1. Definition:
• Section 32 of RERA outlines the various functions of the Real Estate
Regulatory Authority established under the Act.
2. ADR Provision (Section 32(g)):
• Section 32(g) specifically empowers the RERA to facilitate amicable
conciliation of disputes between promoters and allottees through ADR
mechanisms.
• It mandates the RERA to facilitate the resolution of disputes through
mediation or conciliation, thereby promoting a faster and more cost-effective
resolution process.
3. Facilitation of ADR:
• Under Section 32(g), the RERA is tasked with creating a conducive
environment for ADR processes such as mediation and conciliation.
• This involves establishing mechanisms and procedures for the parties
involved in real estate disputes to engage in ADR methods voluntarily.
4. Benefits of ADR under RERA:
• ADR mechanisms like mediation and conciliation offer several benefits,
including quicker resolution of disputes, reduced litigation costs, and
preservation of business relationships between promoters and allottees.
• By facilitating ADR, RERA aims to provide a more efficient and accessible
means of resolving real estate disputes, thereby enhancing consumer
protection and promoting investor confidence in the real estate sector.
5. Role of RERA:
• While RERA facilitates ADR processes, it does not directly arbitrate or
adjudicate disputes. Instead, it serves as a facilitator and regulator of the ADR
mechanism.
• RERA ensures that ADR proceedings are conducted fairly, transparently, and
in accordance with the principles of natural justice.
In summary, Section 32(g) of the RERA Act underscores the importance of alternative
dispute resolution mechanisms in resolving real estate disputes. By empowering RERA to
facilitate mediation and conciliation between promoters and allottees, the provision aims to
promote timely and efficient resolution of disputes, thereby contributing to the overall
objectives of consumer protection and regulatory oversight in the real estate sector.