The fact that the litigation (defined in the delightful The Devil’s Dictionary ‘as a machine which you go into as a pig and come out of as a sausage!) in India is time-consuming and costly is well known. It is also well known that the court system is overburdened resulting in delay in decisions. This in effect means delay in justice being rendered. Hence it is that Alternate Dispute Resolution (ADR) is encouraged as a faster, cheaper option.
In fact, section 89 of the Code of Civil Procedure and as clarified by the Supreme Court in the Afcon’s Infra Ltd. case enjoins upon the courts to do so. Thus, in situations where, ‘it appears that there exist elements of a settlement which may be acceptable to the parties’ the courts are expected to reformulate the terms of a possible settlement. The Courts are to refer the matter for a possible arbitration or conciliation or judicial settlement including settlement through Lok Adalat or mediation.
Hon’ble Justice N.V. Ramana, the Chief Justice of India has in his erudite speech at the India-Singapore Mediation Summit 2021, highlighted the role that mediation can play and the absence of a law on mediation.
India does have an Arbitration and Conciliation Act. And the mechanism of mediation finds mention in various existing laws. However, we do not have any comprehensive law governing all aspects of mediation.
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It is in this background that the Mediation Bill 2021, Bill number XLIII was introduced in the Rajya Sabha in December 2021.
As the Statement of Objects and Reasons mentions, the Bill seeks to promote mediation as a preferred mode of ADR. Mediation has been defined in the Bill ‘as a process whereby party or parties, request a third person referred to as mediator or mediation service provider to assist them in their attempt to reach an amicable settlement of disputes.’ This is indeed laudable. And one would have thought that this would mean an element of voluntariness. However, the Bill inter alia stipulates compulsory pre-litigation mediation in matters of civil or commercial dispute, before parties approach a court. This provision is also proposed to be applicable to the tribunals as notified by the Central Government or a State Government. The Bill proposes to force the parties to stay in mediation for at least for two mediating sessions. This is unusual.
The Bill also provides for filing a suit or appropriate proceedings before a court or tribunal before commencement or during mediation proceedings in “exceptional circumstances.’’ What would constitute “exceptional circumstances” has not been defined. One suspects that this provision is likely to be used extensively by parties reluctant to go in for mediation.
A period of one hundred and eighty days (extendable with the mutual consent of the parties by another one hundred and eighty days) is prescribed for completion of the mediation process. The mediated settlement agreement would be final and binding and enforceable in terms of the Code of Civil Procedure.
The Bill also proposes the ambitious goal of conducting community mediation with consent of parties for disputes which are likely to affect peace, harmony and tranquility amongst the residents or families of any area or locality. This is much needed given the increasing deep divisions in society. However, it will be a huge burden and it would be interesting to see how this will pan out in reality.
There is a proposal for the establishment of a Mediation Council of India. The aim being to promote mediation and to develop India as a robust centre for domestic and international mediation.
The Bill would override all other all other laws on mediation with few exceptions. Consequential amendments are also proposed in such other laws. The Bill provides for mediation in online mode-obviously lessons learnt from pandemic.
And even as the Mediation Bill is to be discussed, we should not lose sight of the fact that some other areas which help in the speedy disposal of litigation are suffering.
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The Income Tax Settlement Commission and the Customs & Excise Settlement Commission are to cease to operate from 1.2.21. Settlement is a process whereby cases pending adjudication can be settled without having to undergo the elaborate process of adjudication. The law stipulated time bound disposal; the functioning of the Settlement Commission was efficient and fast. Its absence will be felt by assesses.
Similarly, the offices of Ombudsman in both the CBDT and CBIC have been closed. Ombudsman was an effective grievance redressal forum. And it should not be forgotten that despite multiple prodding’s from the Supreme Court, the vacancies in the various Tribunals have yet to be filled up. These need to be filled up urgently — Tribunals too reduce the load on the courts.
Hopefully, it will be referred to a Standing Committee for a closer examination and ironing out the rough edges. Having said that The Mediation Bill is a step in the right direction.
To quote again from the Statement of Objects and Reasons’ ‘Mediation results in amicable resolution of disputes in civil, commercial, family and matrimonial matters and fosters collaborative approach, reduces the burden on the courts, and preserves relationships amongst disputants. ‘
The test ultimately will be in its implementation.
— Najib Shah is the former chairman of the Central Board of Indirect Taxes & Customs. The views expressed are personal.
Read his other columns here
(Edited by : Priyanka Deshpande)
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