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.
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.
Comments are closed.