What Is the Mediation Act, 2023? How India's New Mediation Law Changes Dispute Resolution

India waited a long time for a standalone mediation law. For decades, mediation in India operated through Section 89 of the CPC, through the Arbitration and Conciliation Act's conciliation provisions, and through court-annexed mediation programmes. None of these gave mediation a clear, enforceable statutory foundation. The Mediation Act, 2023 (Act No. 32 of 2023) changes that. Assented to on 14 September 2023, it is India's first standalone comprehensive mediation legislation.

For Civil Judge exam and PCS J exam aspirants, this Act is new but already in examination syllabi. Here is everything you need to know.

What Is Mediation?

Section 4 of the Mediation Act defines mediation as a process in which parties seek assistance of a mediator to settle their disputes through the mediator's assistance — without the mediator imposing a solution. The mediator is a neutral facilitator, not a decision-maker. The Act uses 'mediation' and 'conciliation' interchangeably, aligning with the Singapore Convention on International Settlement Agreements Resulting from Mediation, 2019.

Scope: What Disputes Can Be Mediated?

The Act applies to mediation conducted in India where all parties reside, are incorporated, or carry on business in India. It also covers international commercial mediation where at least one party is not a resident or not incorporated in India.

Not all disputes can be mediated. Schedule I to the Act lists non-mediable disputes, including: disputes relating to claims by or against minors or persons of unsound mind (unless represented by a guardian), proceedings related to criminal offences, matters affecting rights of third parties not present, and disputes relating to the territorial integrity of India. Courts can refer any dispute to mediation other than those falling in Schedule I.

Pre-Litigation Mediation: Section 5

One of the Act's signature provisions is the recognition of pre-litigation mediation — mediation before any suit or proceeding is filed. Section 5 provides that, irrespective of whether a mediation agreement exists between them, parties to any civil or commercial dispute may opt, by mutual consent, to attempt mediation before filing any suit.

Unlike the original Bill, which made pre-litigation mediation mandatory for commercial disputes, the Act as passed makes it voluntary. The Parliamentary Standing Committee had expressed concern that mandatory mediation could delay access to courts. Voluntariness is therefore the principle.

However, pre-litigation mediation is encouraged and can be conducted through Mediation Service Providers or mediation institutions. A limitation period is not affected by mediation proceedings — the Act provides that the period spent in mediation is excluded from the computation of limitation.

Also Read: Section 14A SC-ST Act: Special Courts & Appeals

Who Is a Mediator? Qualifications and Appointment

Any person can be a mediator if they possess the qualifications prescribed by the Mediation Council of India. Mediators must be registered with the Council or a recognised mediation institution. They must be impartial, independent, and disclose any conflict of interest before accepting appointment.

A party can request a mediator's disqualification under Section 12 if circumstances exist that give rise to justifiable doubts about their impartiality or independence. The mediator must decline or withdraw if they cannot conduct the mediation impartially.

Time Limit for Mediation: Section 18

Mediation proceedings must be completed within 180 days from the date of first appearance of the parties before the mediator. This period can be extended by the parties by mutual consent for a further period not exceeding 180 days. Total maximum period: one year. After this, if no settlement is reached, the proceedings terminate and the parties are free to approach the courts.

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Confidentiality: Section 22

All statements, information, documents, and admissions made or given during mediation are confidential. They cannot be used as evidence in any court or arbitral proceedings. The mediator cannot be compelled to give evidence about what was said in mediation. No audio or video recording of mediation proceedings is permitted. This confidentiality is a cornerstone of mediation — it encourages frank discussion without fear of prejudice.

The Mediated Settlement Agreement (MSA): Sections 26-28

When parties reach a settlement in mediation, they sign a Mediated Settlement Agreement (MSA). The MSA must be:

●       In writing and signed by the parties.

●       Authenticated by the mediator.

●       Registered with the Authority or mediation institution (where applicable).

Under Section 27, an MSA can be enforced as if it were a decree of a court — through the same procedure under the Code of Civil Procedure, 1908. This is transformative: prior to this Act, there was no clear mechanism to directly enforce a mediation settlement as a decree without going through a court.

Section 28: An MSA can be challenged before the competent court on four grounds: fraud, corruption, impersonation, or where the dispute's subject matter was not eligible for mediation. The challenge must be filed within 90 days of receiving a copy of the MSA, with possible extension of a further 90 days.

Online Mediation: Section 30

The Act recognises online mediation. Parties can conduct mediation through audio-video electronic means with written consent. All the protections of the Act — confidentiality, enforceability of MSA, mediator impartiality — apply equally to online mediation. This is particularly significant for disputes involving parties in different cities or countries.

The Mediation Council of India: Sections 31-46

The Act establishes the Mediation Council of India as a regulatory body to:

●       Register mediators and mediation service providers.

●       Recognise mediation institutions.

●       Promote and regulate mediation in India.

●       Set quality standards and codes of conduct for mediators.

The Council is chaired by a person who has been a Judge of the Supreme Court, a Chief Justice of a High Court, or an eminent person experienced in mediation.

Community Mediation: Section 44

The Act provides for community mediation — for disputes affecting the peace and harmony of a locality. A panel of three mediators from the community mediates such disputes. However, the settlement agreement in community mediation is not enforceable as a court decree — it is merely an agreement that carries moral and social authority.

Relationship With Existing Laws

The Act does not repeal Section 89 CPC but operates alongside it. Court-referred mediation under Section 89 continues. Part III of the Arbitration and Conciliation Act, 1996 (conciliation) is integrated into the Mediation Act's framework.

Exam Relevance

●       Pre-litigation mediation — voluntary, not mandatory.

●       Section 5 — parties can opt for mediation before filing suit.

●       Section 18 — 180 days, extendable by mutual consent, maximum one year.

●       Section 22 — confidentiality, no recording permitted.

●       Section 27 — MSA enforceable as a court decree.

●       Section 28 — MSA challengeable: fraud, corruption, impersonation, non-mediable subject matter. 90-day limit.

●       Section 30 — online mediation permitted.

●       Mediation Council of India — registration and regulation of mediators.

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Frequently Asked Questions

Q1. What is the Mediation Act, 2023?

India's first standalone mediation legislation, enacted as Act No. 32 of 2023. It provides a legal framework for mediation, pre-litigation mediation, the enforceability of mediated settlement agreements, online mediation, and the establishment of the Mediation Council of India.

Q2. Is pre-litigation mediation mandatory under the Act?

No. Section 5 provides that parties to a civil or commercial dispute may, by mutual consent, opt for pre-litigation mediation. It is voluntary. The original bill proposed mandatory pre-litigation mediation, but Parliament changed it to voluntary to protect the constitutional right to access courts.

Q3. What is a Mediated Settlement Agreement?

An MSA is the written agreement signed by all parties and authenticated by the mediator when mediation results in a settlement. Under Section 27, it is enforceable as if it were a court decree under the CPC.

Q4. On what grounds can an MSA be challenged?

Under Section 28, an MSA can be challenged before the competent court only on four grounds: fraud, corruption, impersonation, or where the dispute's subject matter was not eligible for mediation under the Act. The challenge must be filed within 90 days of receiving the MSA.

Q5. How long can mediation last?

Under Section 18, mediation must be completed within 180 days from the date of first appearance. Parties can extend by mutual consent for another 180 days. The total maximum period is one year.

Q6. What is the confidentiality rule in mediation?

Section 22 makes all statements, documents, and communications in mediation confidential. They cannot be used as evidence in court or arbitration. No recording (audio or video) of the proceedings is permitted. The mediator cannot be compelled to testify about mediation proceedings.

Q7. Is mediation available for criminal disputes?

No. Schedule I to the Act lists disputes that are not eligible for mediation. Criminal proceedings cannot be mediated. Disputes involving rights of third parties not present in mediation, disputes affecting minors without proper representation, and disputes concerning India's territorial integrity are also excluded.

Q8. What is the Mediation Council of India?

The Mediation Council of India is the regulatory body established under the Act to register and regulate mediators, recognise mediation institutions, and set standards. It is chaired by a person who has been a Supreme Court Judge, a High Court Chief Justice, or an eminent expert in mediation.

Q9. How does community mediation differ from regular mediation?

Community mediation under Section 44 targets disputes that could affect the peace and harmony of a locality — such as local boundary disputes, neighbourhood conflicts, or community disagreements. A panel of three community mediators resolves such disputes. However, the resulting settlement agreement is not enforceable as a court decree — it is a consensual agreement with social authority only.

Q10. What is the Singapore Convention and how does the Act relate to it?

The United Nations Convention on International Settlement Agreements Resulting from Mediation (the Singapore Convention, 2019) enables enforcement of international mediated settlement agreements across signatory countries. India has signed but not yet ratified it. The Mediation Act, 2023 aligns India's domestic mediation law with the Convention's standards, setting the stage for future ratification.

Conclusion

The Mediation Act, 2023 is a landmark for India's dispute resolution ecosystem. It gives mediation a statutory home, makes mediated settlements enforceable, and establishes regulatory infrastructure. For a country with a backlog of over 45 million pending cases, a well-implemented mediation framework could be genuinely transformative. For judiciary exam aspirants, this Act is an important addition to the ADR law landscape — study it alongside Section 89 CPC, the Arbitration and Conciliation Act, and the Legal Services Authorities Act.

At Aashayein Judiciary, Nitesh Sir covers the Mediation Act, ADR law, and procedural law as part of the Civil Judge exam and PCS J exam preparation. Explore our Online Judiciary Coaching, Judiciary Notes, and Mock Test series to stay current on all new legislation.