Alternate Dispute Resolution (A.D.R.

)
Class Assignment
Part 3rd of Arbitration and conciliation Act,1996

Submitted by – Ajitesh Sharma

B.A.LL.B. Semester 8th (Section -A)
System identification- 2020545196
Roll number- 200959006.

Submitted to – DR Razia Chauhan

Assistant Professor, Sharda School of Law, Sharda University, Greater
Noida
 Introduction

Part 3rd of the Arbitration and conciliation Act, 1996 Deals with a mode of alternate dispute
resolution known as Conciliation, during the process of conciliation, the disputing parties are
assisted by a 3rd neutral and unbiased party known as the conciliator who assists the parties to
reach settlement which is agreeable mutually by both the parties. The process of conciliation
is a non-binding, non-adjudicatory process. It is the will of the parties to agree to what has been
suggested by the conciliator or they can reject it thus it makes the process non-binding,
however, if the parties agree to the recommendations of the conciliator and reach a mutually
appeasing agreement then a settlement document which is made by the conciliator becomes
binding and final, applicable on both the parties. Conciliation can also be said to be a party
centred negotiation. In comparison to mediator a conciliator’s role is more active than just
facilitative. Consent of parties is necessary to refer a dispute to conciliation. Section 74
provides that once a settlement document is made under the Arbitration and Conciliation
Act,1996 then such an agreement is as enforceable as a decree of civil court. The settlement
reached is not appealable as it’s a non-adjudicatory procedure. The process of conciliation lays
an emphasis on the present and future thus tires to salvage and safeguard the relations.
Confidentiality is of significant vitality in the process of conciliation.

Before coming of the Mediation Act, 2023 the provisions regarding conciliation were dealt
under section 61-81 of the Arbitration and Conciliation Act, 1996 but now has been substituted
by the provisions of the Mediation Act 2023, and Conciliation referred to under this Act is
taken to mean the Mediation Provided under Section 3 Clause (h) of the Mediation Act, 2023.
It is to be noted that date of enforcement is yet to be notified. This article thus will deal with
conciliation as stood before coming of Mediation Act 2023. Specifically, this Article will cover,
Applicability, Scope, Commencement of conciliation proceedings and how the Conciliators are
Appointed.
 Application and Scope of Conciliation

Section 61 of the Arbitration and Conciliation Act, 1996 covers the application and scope, it
covers apart from the cases where the law which for the time being in force itself provides
another way or apart from the cases where parties have agreed upon some other method of
dispute resolution, apart from those cases this part which covers conciliation is applicable for
dispute resolution, the disputes which can be born out of legal relation of the parties which
may or may not be contractual and to all other process and related proceeding.

This mode of dispute resolution under this part will not apply to cases where because of a law
for the time being in force such cases are not to be submitted for conciliation. Thus, it can be
inferred that conciliation process applies to disputes born out of legal relationship which
means right is created for one party to sue the other party and the other party is liable to be
sued.

Commencement of Conciliation proceedings

Section 62 of the Arbitration and Conciliation Act, 1996, provides for how the conciliation
proceedings are initiated. Section Covers that to begin the conciliation proceedings, a written
invitation is to be sent by the party which wants to invoke conciliation to the other party to
the dispute. Such invitation that is sent should also briefly discuss the matter in dispute and
thus identifying the subject of the dispute.

The proceedings are deemed to have been commenced from the time the other party has
readily and freely accepted the invitation to invoke the process of Conciliation. As is
provided under Section 62 clause 2.

As the process of conciliation is a voluntary process it is enshrined under Section 62 clause 3

where right has been provided to the other party to reject the invitation to conciliate, thus, if
the invitation is rejected then no conciliation proceedings will take place.
Further Section 62 clause 4 provides a separate scenario that in which the party that wants to
initiate conciliation has sent a invitation to the other party but if then the other party neither
accepts the invitation nor does he reject it but gives no response in that scenario if the period
of 30 days has lapsed since the date of sending the invitation or any other duration to provide
a response as provided in the invitation in that case the party inviting can suppose it to means
as a rejection to invoke conciliation. Also, provided that if he supposes and means such no
response as rejection to conciliation then also, he has to inform this to the other party in
writing.

Appointment of Conciliators

Under this first there is a need to be ascertained that how many conciliators can be appointed
the provision of which is covered under Section 63 of the Arbitration and Conciliation
Act,1996. The Section provides that traditionally there is the provision of only one conciliator
but regardless of this it depends on the will of the parties and if they want then they can
appoint more than one conciliator. A very important aspect of this is covered in Section 63
clause 2 which provides for the scenario where there is more than one conciliator in that
scenario general rule is that they have to work together in pursuance of a common goal that is
to conciliate and assist the parties to reach a amicable, mutually agreeable settlement of the
dispute. This provision ensures that conciliators remain unbiased and a neutral 3rd party
which is the whole essence of conciliation.

Moving ahead Section 64 of the Arbitration and Conciliation Act,1996 provides for the
provision of appointment of the conciliators:

The provision provides in the process with only one conciliator the parties jointly must decide
who will be the conciliator.

In another case where the parties require 2 conciliators then each party is responsible to
appoint one conciliator each.

The section also covers the scenario where three conciliators are intended to be appointed by
the parties in that peculiar case. The parties just like the previous scenario have the onus to
appoint one conciliator each. After the first 2 od the 3 conciliators are appointed individually
by the parties. Then, just like in case of the solo conciliator the parties must jointly work
together to appoint the third conciliator, furthermore, the third appointed conciliator will act
as the presiding conciliator over the other two conciliators.

The section covers that such appointment of the conciliators will be subject to the provision
provided under clause 2 of section 64 of the Arbitration and Conciliation Act,1996:

The clause 2 to section 64 provides that the parties have also been facilitated as to they have
been provided a right to enlist a suitable institution to assist them in appointing the
conciliators,

The institution can be asked by the parties to recommend names of the person who are fit to
be appointed as the conciliators or the parties after a mutual agreement between them can ask
directly the said institution or person to appoint one or more conciliators if required to be
directly appointed by the parties.

Proviso to Section 64 clause 2 which is to be read with a strict interpretation provides, that
where such institution is recommending the conciliator or directly appointing the conciliator
as given in both the scenarios in that case the institution should make such recommendation
or appointment with a complete regard to ensuring such a conciliator which is bound to be
impartial or unbiased as this is the very essence of the conciliation to make sure the third
party is neutral.

Furthermore, in case where there is a sole Conciliator or a 3rd presiding conciliator is to be

recommended or appointed by the institution then the institution should make sure that the
said conciliator does not share nationality with either of the party, this is mandated to ensure
that the third party remains free form any biases based on any ground such as even of a
shared nationality.
 Conclusion
As an alternate dispute redressal mechanism, the use of conciliation bequeaths unto parties’
multifarious benefits which can be understood as it being cost effective and comparatively a
faster process than normal litigation, not only this as neutrality of third party is significantly
vital thus it ensures that unbiased and impartial process. Parties invoking this process as a
mode of dispute redressal receive a great assistance. For the conciliator to honestly and
efficiently discharge his duties he has to make sure the presence of party’s face to face with
each other and with himself, conducting joint and separate sittings with only one goal at
intention that is to provide for a mutually agreeable and amicable settlement of the dispute.

The process of conciliation is a blessing for the parties who wish to safeguard their future
relations as in this process parties are directly involved with each other with the conciliator
actively providing a ground and tools where parties can jointly come at the resolution of a
dispute which is agreeable to them both. Conciliation thus does not go by a set standard
common approach for all but is based on individualistic approach based on the nature of each
dispute as to optimally come at satisfactorily acceptable settlement agreement between the
disputing parties. The role of conciliator is also quite significant and active where he is
directly involved in assisting parties and providing recommendations for settlement. Thus,
concluding with in conciliation if intention is clear then this a sure fast way to ensure a
satisfactory and fast resolution of disputes.
References

1. https://lddashboard.legislative.gov.in/actsofparliamentfromthe
year/arbitration-and-conciliation-act-1996
2. http://psalegal.com/wp-
content/uploads/2017/01/DisputeResolutionBulletin-
IssueVII08092010070309PM.pdf

3. https://www.legalbites.in/meaning-and-scope-of-conciliation/

4. http://psalegal.com/wp-
content/uploads/2017/01/DisputeResolutionBulletin-
IssueVII08092010070309PM.pdf

5. http://www.nishithdesai.com/fileadmin/user_upload/pdfs/Conc
iliation_and_ADR_in_India.pdf

6. http://legislative.gov.in/sites/default/files/A1996-26.pdf

7. http://www.legalserviceindia.com/legal/article-1180-
principles-and-procedure-of-conciliation.html

8. https://indiankanoon.org/doc/1600086/