Lok Sabha Question No. 2027 (UNSTARRED), answered on 2024-08-02
Subject: Alternate Dispute Resolution
Ministry: LAW AND JUSTICE
Asked by: Shri Dhaval Laxmanbhai Patel, Shri Baijayant Panda, Shri Dharambir Singh

## GOVERNMENT OF INDIA MINISTRY OF LAW & JUSTICE DEPARTMENT OF LEGAL AFFAIRS

## LOK SABHA

## UNSTARRED QUESTION NO. 2027 TO BE ANSWERED ON FRIDAY, THE 2nd AUGUST, 2024

## Alternate Dispute Resolution

2027. Shri Dharambir Singh:

Shri Dhaval Laxmanbhai Patel:

Shri Baijayant Panda:

Will the Minister of LAW AND JUSTICE be pleased to state:

- (a)  the  steps  taken  by  the  Government  to  promote  alternate  dispute resolution such as mediation, arbitration and reconciliation to reduce the
- burden on courts since 2014; and
- (b) the benefits of alternate dispute resolution for the public at large?

## ANSWER

## MINISTER OF STATE (INDEPENDENT CHARGE) OF THE MINISTRY OF LAW AND JUSTICE AND MINISTER OF STATE IN THE MINISTRY OF PARLIAMENTARY AFFAIRS (SHRI ARJUN RAM MEGHWAL)

(a) The Government is promoting alternate dispute resolution (ADR) mechanisms including arbitration and mediation, as these mechanisms are less adversarial and are capable of providing a better substitute to the conventional methods of resolving disputes. The use of ADR mechanisms is also expected to reduce the burden on the judiciary and thereby enable timely justice dispensation to citizens of the country. Some of the major initiatives over the years in this regard include amendments in extant laws and enactment of new legislations.

The Arbitration and Conciliation Act, 1996 has been progressively amended in the years 2015, 2019 and 2020 to keep pace with current developments in the arbitration  landscape  and  to  enable  arbitration  asa  viable  dispute  resolution mechanism.  The  amendments  are  aimed  at  ensuring  timely  conclusion  of arbitration proceedings, neutrality ofarbitrators, minimizing judicial intervention in the arbitral process andquick enforcement of arbitral awards. The amendments  are  further aimed  at promoting  institutional arbitration and updating  the  law  to  reflect  best  global  practices,  thereby  establishing  an arbitration ecosystem, where arbitral institutions can grow.

The  Commercial  Courts  Act,  2015  was  amended  in  the  year  2018  to provide for Pre-Institution Mediation and Settlement (PIMS) mechanism. Under this  mechanism,  where  a  commercial  dispute  of  specified  value  does  not contemplate  any  urgent  interim  relief,  the  parties  have  to  first  exhaust  the mandatory  remedy  of  PIMS  before  approaching  the  Court.  This  is  aimed  at providing  an  opportunity  tothe  parties  to  resolve  the  commercial  disputes through mediation.

The  India International  Arbitration Centre  Act,  2019,  was  enacted toprovide for the establishment and incorporation of India International Arbitration Centre  (Centre) for the purpose  of creating an independent, autonomous and world class body for facilitating institutional arbitration and to declare the Centre to be an institution of national importance. The Centre shall be  providing  world  class  arbitration  related  services  at  its  facilities  in  a  cost effective  manner  for  both  domestic  and  international  commercial  disputes, including  reputed  empaneled  arbitrators  and  requisite  administrative  support forthe smooth conduct of arbitral proceedings.

The Mediation Act, 2023, lays down the legislative framework formediation  to  be  adopted  by  disputing  parties,  especially  under  theaegis  of institutional mediation.

(b) The basic premise of using ADR mechanisms for resolution of disputes is to reduce the burden on the judiciary, enable informal justice dispensation to the parties,  including  the  public  at  large.  The  major  benefits  of  using  ADR mechanisms include timely and efficacious resolution of disputes. A time line to conclude  the  ADR  process  has  been  prescribed  in  the  respective  Acts.  The legislative  reforms  with  respect  to  the Arbitration  and  Conciliation Act,  1996 have facilitated the minimization of court-intervention in arbitration proceedings and efficacious settlement of commercial disputes, thereby enabling ease of doing business. The Mediation Act, 2023 is expected to be a pivotal legislative intervention towards providing standalone law on mediation and enabling the growth of a culture of amicable settlement of disputes out of court and the outcome being party driven.

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