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Legal Framework of Mediation in India and the Scope of Virtual Mediation

The Indian Government had announced a complete indeterminate lockdown across the nation in the month of March 2020 amid the spread of Corona Virus (COVID-19). Consequently, the Judiciary has announced continuation of court proceedings by use of video-conferencing facilities for ‘urgent hearings’ only. Lockdown implies travel restrictions and social distancing making it not only difficult for physical filing of documents but also for physical attendance of parties, witnesses and representatives while maintaining safety measures. The measures which Courts are employing demonstrate their sincere effort to keep justice on track. But the Indian Judiciary is already reeling under a glut of pending litigation, any slowing down of Court proceedings during such emergency hobbles the litigation. Thus, exploring alternate dispute resolution mechanisms in the given situation can ensure interests of parties being progressed. In other words, the parties will be able to tailor their proceedings so as to meet their specific requirements. Other benefits of Online Dispute Resolution include savings in cost and  time, convenience and confidentiality and non-confrontational character of it.[i] The potential uses of the technology are widely agreed upon. With remote working now the norm across all areas of business, courts and tribunals, the possibility of use of technology for a more accessible, transparent and faster way of resolving grievances particularly for companies must be made use of and try best to ensure that justice is not unduly delayed.[ii]

The feasibility of enacting Indian Mediation Act to take care of various aspects of mediation in general has already been recommended by the Supreme Court.[iii] However, less is explored on establishing an on-line dispute resolution platform for parties seeking to resolve a commercial dispute arising out of a cross-border transaction or domestic e-transaction. India is a signatory to the United Nations Convention on the International Settlement Agreements Resulting from Mediation (“The Singapore Convention on Mediation”).[iv] Under the Convention, most agreements that are settled through a mediation process will be enforceable in the courts of any signatory state in accordance with their own rules of procedure and under the conditions laid down in the Convention, thus, paving way for settlements to be recognized internationally.[v]

  • Current Legal Framework of Mediation in India: It is well established that disputants choose one mode of dispute resolution over another for their different competitive advantages. The reasons for moderate utilization of Alternate Dispute Resolution (ADR) in India are well documented. Mediation is a negotiation between two or more parties facilitated by an agreed-upon third party.[vi]

(a) Enforceability: There are various types of mediation in India but unless and until a formal settled agreement has been entered into, mediation is still non-binding. The consensual nature of process means that either party can walk away from the process at any time. In India, there is no process by which such settlement agreements through private mediation can easily be recognized and enforced – they effectively have the status of contracts only (enforceable under the rules of contract law) and will require further court proceedings to force compliance should one party fail to abide by the terms agreed. The parties to a contract can agree to resort to mediation as a form of dispute resolution, either prior to or after the emergence of a dispute. Most mediation settlement agreements are enforced voluntarily without court proceedings because parties decide the terms of settlement and do not sign the agreement till, they are convinced they wish to settle the dispute. Such a settlement agreement in a conciliation proceeding is enforceable by law as an arbitration award.[vii]

For a settled agreement to take the color of an ‘arbitral award’ under the Arbitration and Conciliation Act, 1996 (“A&C Act”), complete compliance with statutory requirements of Section 73 is required.[viii] The Supreme Court while dealing with ‘settlement agreements’ between parties held in Haresh Dayaram Thakur v. State of Maharashtra[ix] that “Under sub-section (3) of Section 73 the settlement agreement signed by the parties is final and binding on the parties and persons claiming under them. It follows therefore that a successful conciliation proceeding comes to an end only when the settlement agreement signed by the parties comes into existence. It is such an agreement which has the status and effect of legal sanctity of an arbitral award under Section 74." Lastly, settlement agreements fall within the ambit of an arbitral award[x] as rendered by the arbitral tribunal under Section 30 of the Act.

However, the statutory mediation is dealt under Civil Procedure Mediation Rules, 2006. The aftermath of Supreme Court decision in Salem Advocate Bar Association v. Union of India[xi] (Report III) that focused on mediation, led to drafting of case management guidelines, model rules by respective High Courts and later establishing mediation centers. The Rules mention that the ‘settlement agreement’ attained through mediation, which is duly signed and attested, will take the shape of a ‘decree’ that can be enforced by the Court. The Companies (Mediation and Conciliation) Rules, 2016 pertain to Section 442 of the Companies Act, 2013 that provides for setting up of Mediation and Conciliation Panel for facilitating mediation and reconciliation between the parties during any stage of the proceeding pending before the quasi-judicial bodies i.e. the Central Government, Tribunal or Appellate Tribunal. It is important to note that, Rule 18 of the said Rules states that “Parties alone shall be responsible for taking decision” and the mediator or conciliator shall not impose any decision on the parties.” Further, Rule 25 states that such Settlement Agreement shall be forwarded by the mediator or conciliator in the form of a report to the Central Government or the Tribunal or the Appellate Tribunal which shall pass an order in accordance with the report submitted.[xii] The court-annexed mediation is prescribed in Code of Civil Procedure Code, 1908 under Section 89 dealing with out of court settlement provides for court-annexed mediation and conciliation. "It should not also be overlooked that even though Section 89 of CPC mandates courts to refer pending suits to any of the several alternative dispute resolution processes mentioned therein, there cannot be a reference to arbitration even under Section 89 of CPC, unless there is a mutual consent of all parties, for such reference."[xiii] In few cases, the courts suo moto refer civil disputes to Government established Mediation Centers. In the event of settlement of dispute in post litigation mediation, the court fee paid by the parties is refunded.[xiv]



(b) Pre-litigation mediation: When the parties undertake mediation individually, independent of Court proceedings, it is then termed pre-litigation mediation or private mediation.[xv] However, the Government in May, 2018 promulgated an Ordinance amending the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 that deals with Commercial Disputes and constitution of Commercial Courts. The said amendment under Section 12A, Chapter IIIA makes it mandatory for a party to exhaust the remedy of mediation before initiating court proceedings under the Commercial Courts Act, with the limited exception of cases where urgent relief is being sought. And the ‘period of such mediation proceeding’ shall not be computed for limitation under the Indian Limitation Act, 1963.

At the stage of complaint or after: The Consumer Protection (Amendment) Act, 2019 under [Chapter V] Section 74 paves way for settlement of disputes utilizing ‘mediation’ in cases where there is a possibility of settlement at the stage of admission of complaint or at any later stage, with the consent of both the parties. The State Government shall by notification establish a consumer mediation cell to be attached to every District and State Commission of the State. The Court shall pass an order recording the settlement and dispose of the case pursuant to mediation under Section 80 of the said Act.

(c) Current status of enforcement of Mediation outcome:  The Delhi High Court in Shri Ravi Aggarwal v. Shri Anil Jagota[xvi] debated the question of law as to how a settlement recorded in a private mediation should be enforceable. And it was held that a settlement agreement is an outcome of private mediation is not a conciliation settlement agreement as defined under Section 73 and Section 74 of the Arbitration and Conciliation Act, 1996 unless procedure laid down in the said Act is followed. The current practice on enforceability of settlement agreement is as following:

  1. Court-annexed mediation: A consent decree is obtained under Order XXIII Rule 3 of Civil Procedure Code, 1908 on the terms agreed upon after filing a suit and undergoing litigation procedure (this runs against the whole purpose of opting for mediation). Generally, in court-annexed mediation, a decree is obtained that is binding on both parties.
  2. Section 2(h) of the Indian Contract Act, 1872 defines contract as “any agreement enforceable by law is a contract”. And the very formation of a contract can be express or implies. Thus, majority of the private mediation that occurs and settlements drawn upon are enforced under the Contract Law.

iii. Mediation as Conciliation: A mediation settlement can be enforced as an arbitral award if the proceeding takes on recommendation of the arbitral tribunal and the tribunal records the terms of settlement as an award.[xvii]

(d) Way forward: A recent News Report enunciates that the Supreme Court has set up a panel headed by Mediator Mr. Niranjan Bhat, to firm up a draft legislation to give legal sanctity to disputes settled through mediation, which would then be sent to the Government as a suggestion from the Apex Court. Though there are domestic legislations that provide for alternative dispute resolution but discrepancy such as the overlap between mediation and conciliation impede these provisions from being successful.[xviii]

  • Role of Virtual Mediation viz-a-viz Pandemic [COVID-19]: The Online Dispute Resolution is gaining momentum in India[xix] Covid-19 is not the initiator of online mediation platforms in India. However, the lockdown has led to many trade disputes exploring conflict resolution using Mediation proceedings. The platform that mediators and service provider’s use might vary but the process is conducted through e-mail/video conferencing/telephone. Parties exchange documents and mediator guides the process. The “settlement” reached by the parties through private mediation during the lockdown must be in the form of a formal Agreement duly signed. So, online sources such as DocuSign can be used to e-sign the ‘Settlement Agreement’. It is not only crucial to choose the right platform for online mediation process but also ensure confidentiality and security of the data being shared. It is advised to have a ‘pre-mediation dialogue’ with the platform to build confidence among parties also, ensure data protection and know more about software features being used.

Following are the Agencies/Institutions/Organizations providing online mediation services that have a regulated framework to conduct mediation proceedings in various matters

(a) Bangalore International Mediation, Arbitration and Conciliation Center (BIMACC): Conducts online Arbitration, Mediation and Conciliation using Video Conferencing facilities. Disputes concerning e-commerce are easily handled by exchange of mails and secure video conferencing. Several e-commerce companies in India and abroad employ BIMACC’s online ADR services.

(b) ODR Ways: Launched in 2015, is an online mediation platform called DOMAIN and is one of the first in India. One of the technical features of platform include an Online Pre-Mediation Software-Deciding the time and venue of the Mediation, Audio-Conferencing, Online case progress tracker, mediator’s database, web interface design.

(c) Online Consumer Mediation Center (OMC): The OMC established at NLSIU Bangalore under the aegis of Ministry of Consumer Affairs, Government of India with the mission of providing innovative technology for consumers and organizations to manage and resolve conflicts and to propel online mediation as a first choice to resolving consumer disputes. Key features of OMC online platform are: Easy accessibility, Data Security, Confidentiality, Cost-effective, strict code of ethics to qualified web mediators to ensure neutrality and integrity at every stage of the online mediation.[xx]  

(d) Other Online Dispute Resolution (ODR) Platforms: Center for Alternative Dispute Resolution Excellence (CADRE), Center for Online Dispute Resolution (CODR) and SAMA a totally new way to resolve disputes between businesses and customers, employers and employees, landlords and tenants, professionals and clients, or anyone else- wholly through online medium, in a fast and cost effective manner[xxi] among others. Extensive use of video-conferencing platforms such as Zoom/Skype/Other Apps can host mediation proceedings between disputants and a third private party acting as a ‘mediator’.

  • Key takeaways: Covid-19 hangs over future like a spectre! In the context of an on-going crisis, the ill effects of lockdown and non-functioning of activities is predictive to have a drastic impact on not only the economy but also other sectors, to which judiciary is no exception. Even the ‘E-Courts Project’ launched years ago could not bring in desired digital transformation of Courts. Owing to the current scenario, a total shift to digitalization of court records and proceedings is an absolute challenge. Thus, offers no immediate possibility of such legal revolution. However, speeding up the digital transformation and adopting best practices to minimize the negative consequences of the pandemic on the litigation and speeding up disposal of cases – is need of the hour. As a matter of fact, substantial numbers of cases that are pending in Indian Courts relate to family law disputes; Section 138 Negotiable Instruments Act, 1881 and Road Traffic Accident cases. Consequently, mandatory sorting out of these matters using ‘mediation’ without requiring parties to be present at one place will result in easing out the burden.



The flip side to this is use of artificial intelligence for conflict resolution that has the potential to come to the fore. Virtual Mediation is going to be a game-changer in the arena of Alternative Dispute Resolution mechanisms. The Indian Parliament will soon legislate on “Mediation Act” covering aspects such as confidentiality, voluntary nature of the process, neutrality and conflict of interest etc. COVID-19 Pandemic has paved way to increased utilization of e-mediation and thus, it is hoped to have virtual mediation part of the new law that is being drafted. Now, how the State will provide for the ‘enforcement of mediation outcomes’ is worth the wait. The Singapore Convention addresses the legal vacuum to an extent by validating “settlement” attained through mediation of a cross-border dispute and enforces settlement agreements directly enforceable by the Courts of all State Parties to the Convention.[xxii] Similarly, the Indian legislators must ensure ‘mediation’ is considered as a separate mode of dispute resolution and the outcome/settlement agreement must have a legal sanctity that requires no further recourse to Courts by the parties to have it enforced  or initiate litigation. Nonetheless, any  irregularity in the legal framework should not hinder the growth of mediation conducted by institutions mentioned earlier and others, in a standard manner.

The virtual mediation offers benefits such as inventive solutions to disputes, continuation of commercial relationship of parties, enabling parties to achieve an outcome that would not be available through court procedure, a win-win outcome etc.[xxiii] With the anticipated increase in disputes, there will be a welcome increase in the use of technology and transactions that consider mediation as a time and cost efficient process as part of their dispute resolution toolkit. Thus, virtual mediation must be encouraged and will be a quick fix to stagnation that is occurring.



[i]Derric Yeoh, ‘Is Online Dispute Resolution the Future of Alternative Dispute Resolution?’, Kluwer Arbitration Blog, March 29th, 2018. Also available at:; Last seen on 07/04/2020.

[ii]Antonia Croke, Nigel Sharman, ‘Hong Kong courts in lockdown-how technology is helping with dispute resolution in the time of COVID-19’, Hogan Lovells, 03/04/2020. Also available at:; Last accessed on 07/04/2020

[iii] See M.R. Krishna Murthi v. The New India Assurance Co. Ltd., 2019 SCC Online SC 135.

[iv] Source:; last seen on 07/04/2020

[v] The Convention was adopted on 20th December 2018. The Singapore Convention Roundtable was held on 7 August 2019 conjunction with the signing ceremony of the Singapore Convention on mediation. Available at:; last seen on 07/04/2020

[vi] Pon Staff, ‘Using E-Mediation and Online Mediation Techniques for Conflict Resolution’, , Program on Negotiation, Harvard Law School, Daily Blog, January, (2020). Available at:; last seen on 08/04/2020

[vii] Source:; last seen on 08/04/2020

[viii] See Mysore Cements Ltd. v. Svedala Barmac Ltd. AIR 2003 SC 3493

[ix] [2000] 6 SCC 179. The same was reiterated in AIR 2003 SC 3493

[x] Anuradha SA Investments LLC & Anr. v. Parsvnath Developers Limited & Ors.; 2017 (4) ARBLR 72 (Delhi High Court)

[xi] 2005 (6) SCC 344

[xii] See Rule 26 of the Companies (Mediation and Conciliation) Rules, 2016

[xiii] Jagdish Chander v. Ramesh Chander 2007 (5) SCC 719

[xiv] Available at:; Last accessed on 08/04/2020

[xv] Mediation and Project Committee, Mediation and Training Manual of India, Available at:; last accessed on 09/04/2020

[xvi] EFA (OS) No. 19 of 2009/ 2009 SCC OnLine Del 1475

[xvii] S. 30 & 73, The A&C Act, 1996

[xviii] Ajmer Singh, ‘Supreme Court forms committee to draft mediation law, will send to Government’, Economic Times, January 19, 2020, available at:; Last seen on 09/04/2020.

[xix] Indulekha  Aravind, ‘Online dispute resolution gaining momentum in India’, ET, January 12th , 2020, available at:; last seen on 09/04/2020

[xx] Source:; last seen on 09/04/2020

[xxi] Respective Online URLs:; and ; last seen on 09/04/2020

[xxii] New York Convention, 1958 provides for arbitral award directly enforceable in a large number of countries across the World similar to the Singapore Convention that deals with ‘mediation’ settlement agreements

[xxiii] The Singapore Convention on Mediation – a new era in International Dispute Resolution, Newsletter, August (2019), Linklaters, available at:; last seen on 09/04/2020.



Sneha Vardhani

I am a practicing advocate enrolled with the Bar Council of Telangana, India. I am currently involved in property and commercial litigation. I have been actively part of a District Family Counselling Centre that involves practicing mediation for matrimonial disputes. I have graduated from National Academy of Legal Studies and… MORE >

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