THE MEDIATION ACT, 2023 - AN OVER VIEW

[Mr. M. GOVINDARAJAN]

Mediation Act

The Central Government, vide Notification No. CG-DL-E-15092023-248775, dated 14.09.2023 enacted the Act called as ‘The Mediation Act, 2023’ (‘Act’ for short).  This Act extends to the whole of India.  It shall come into force on such date as the Central Government may, by notification, appoint and different dates may be appointed for different provisions of this Act.

Object of the Act

The object of the Act is to promote and facilitate mediation, especially institutional mediation, for resolution of disputes, commercial or otherwise, enforce mediated settlement agreements, provide for a body for registration of mediators, to encourage community mediation and to make online mediation as acceptable and cost effective process and for matters connected therewith or incidental thereto.

Non applicability of the Act

This Act shall not apply to, or in relation to, any mediation or conciliation commenced before the coming into force of this Act.

Structure of the Act

The Act contains 10 Chapters and 45 sections dealing with the subjects as detailed below-

• Chapter I - Preliminary - Section 1
• Chapter II - Application - Section 2 to Section 3;
•  Chapter III - Mediation - Section 4 to 7;
• Chapter IV - Mediators - Section 8 to Section 12;
• Chapter V - Mediation Proceedings - Section 13 - Section 26;
• Chapter VI - Enforcement of Mediated Settlement Agreement - Section - 27;
• Chapter VII - Online mediation - Section 30;
• Chapter VIII - Mediation Council of India - Section 31 to Section 39;
• Chapter IX - Mediation Service Providers and Mediation Institutes - Section 40 to Section 42;
• Chapter X - Community mediation - Section 43 to Section 44;
• Chapter XI - Miscellaneous - Section 45.

The Act contains 10 Schedules as detailed below-

• Schedule I - Disputes or matters not fit for mediation;
• Schedule II - Non over riding of the Act of certain current legislations;
• Schedule III - Amendment to Indian Contract Act, 1872;
• Schedule IV - Amendment of Civil Procedure Code, 1908;
• Schedule V - Amendment to Legal Services Authority Act, 1987;
• Schedule VI - Amendment to Arbitration and Conciliation Act, 1996;
• Schedule VII - Amendment to Micro, Small and Medium Enterprises Development Act, 2006;
• Schedule VIII - Amendment to Companies Act, 2013;
• Schedule IX - Amendment to Commercial Courts Act, 2015;
• Schedule X - Amendment to Consumer Protection Act, 2019.

Application

Section 2 of the Act provides that the Act shall apply where the mediation is conducted in India, and-

• all or both parties habitually reside in or are incorporated in or have their place of business in India; or
• the mediation agreement provides that any dispute shall be resolved in accordance with the provisions of this Act; or
• there is an international mediation; or
• wherein one of the parties to the dispute is the Central Government or a State Government or agencies, public bodies, corporations and local bodies, including entities controlled or owned by such Government and where the matter pertains to a commercial dispute; or
• to any other kind of dispute if deemed appropriate and notified by the Central Government or a State Government from time to time, for resolution through mediation under this Act, wherein such Governments, or agencies, public bodies, corporations and local bodies including entities controlled or owned by them, is a party. 

Disputes not fit for mediation

Section 6 of the Act provides that mediation under this Act shall not be conducted for resolution of any dispute or matter contained in the indicative list under the First Schedule as detailed below-

• Disputes which by virtue of any law for the time being in force may not be submitted for mediation.
• Disputes relating to claims against minors, deities; persons with intellectual disabilities under paragraph 2 of the Schedule and-

• person with disability having high support needs as defined in clause (t) of section 2 of the Rights of Persons with Disabilities Act, 2016;
•  persons with mental illness as defined in clause (s) of sub-section (1) of section 2 of the Mental Healthcare Act, 2017;
• persons of unsound mind, in relation to whom proceedings are to be conducted under Order XXXII of the Code of Civil Procedure, 1908; and
• suits for declaration of title against Government; declaration having effect of right in rem.

• Disputes involving prosecution for criminal offences.
• Complaints or proceedings, initiated before any statutory authority or body in relation to registration, discipline, misconduct of any practitioner, or other registered professional, such as legal practitioner, medical practitioner, dentist, architect, chartered accountant, or in relation to any other profession of whatever description, which is regulated under any law for the time being in force.
• Disputes which have the effect on rights of a third party who are not a party to the mediation proceedings except only in matrimonial disputes where the interest of a child is involved.
• Any proceeding in relation to any subject matter, falling within any enactment, over which the Tribunal constituted under the National Green Tribunal Act, 2010 has jurisdiction.
• Any dispute relating to levy, collection, penalties or offences, in relation to any direct or indirect tax or refunds, enacted by any State legislature or the Parliament.
• Any investigation, inquiry or proceeding, under the Competition Act, 2002, including proceedings before the Director General, under the Act; proceedings before the Telecom Regulatory Authority of India, under the Telecom Regulatory Authority of India Act, 1997 or the Telecom Disputes Settlement and Appellate Tribunal established under section 14 of that Act.
• Proceedings before appropriate Commissions, and the Appellate Tribunal for Electricity, under the Electricity Act, 2003.
• Proceedings before the Petroleum and Natural Gas Regulatory Board, and appeals there from before the Appellate Tribunal under the Petroleum and Natural Gas Regulatory Board Act, 2006.
• Proceedings before the Securities and Exchange Board of India, and the Securities Appellate Tribunal, under the Securities and Exchange Board of India Act, 1992.
• Land acquisition and determination of compensation under land acquisition laws, or any provision of law providing for land acquisition.
• Any other subject matter of dispute which may be notified by the Central Government.

Over riding effects

Section 55 of the Act provides that subject to the enactments mentioned in the Second Schedule, the provisions of this Act shall have overriding effect for conduct of mediation or conciliation notwithstanding anything inconsistent therewith contained in any other law for the time being in force, and any instrument having force of law.

The list of enactments in Schedule II is as below-

• The Industrial Disputes Act, 1947;
• The Brahmaputra Board Act, 1980;
• The Cine-Workers and Cinema Theatre Workers (Regulation of Employment) Act, 1981;
• The Family Courts Act, 1984;
• The Legal Services Authorities Act, 1987;
• The Maintenance and Welfare of Parents and Senior Citizen Act, 2007;
• The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013;
• The Finance Act, 2016;
• The Industrial Relations Code, 2020.

Mediation - meaning

Section 3(h) of the Act defines the term ‘mediation’ as including a process, whether referred to by the expression mediation, pre-litigation mediation, online mediation, community mediation, conciliation or an expression of similar import, whereby parties attempt to reach an amicable settlement of their dispute with the assistance of a third person referred to as mediator, who does not have the authority to impose a settlement upon the parties to the dispute.

Pre-litigation mediation

Section 3(u) of the Act defines the expression ‘pre-litigation mediation’ as a process of undertaking mediation, as provided under section 5, for settlement of disputes prior to the filing of a suit or proceeding of civil or commercial nature in respect thereof, before a court or notified tribunal under sub-section (2) of section 5.

Online mediation

Section 30 of the Act provides that Online mediation includes pre-litigation mediation that may be conducted at any stage of mediation under this Act, with the written consent of the parties including by the use of electronic form or computer networks but not limited to an encrypted electronic mail service, secure chat rooms or conferencing by video or audio mode or both.

Community mediation

Section 43 provides that any dispute likely to affect peace, harmony and tranquility amongst the residents or families of any area or locality may be settled through community mediation with prior mutual consent of the parties to the dispute.