The Mediation Act, 2023: What It Changes

The Mediation Act, 2023 (Act No. 32 of 2023) is India's first standalone law on mediation. It sets a 120 day time limit for mediation, makes a signed and authenticated mediated settlement binding and enforceable like a court decree, allows a challenge only on four narrow grounds, and creates a Mediation Council of India, online mediation and community mediation. It also rewrites parts of the CPC, the Arbitration and Conciliation Act, the Commercial Courts Act and the Consumer Protection Act so that they point to this one law.

This explainer is for B.A. LL.B. and LL.B. students preparing for ADR papers, and for anyone in Kanyakumari District who would rather settle a family, neighbourhood or business dispute than spend years in court. Section numbers below are taken from the Act as published in the Gazette of India on 15 September 2023.

Is the Act in force?

The President gave assent on 14 September 2023. Under section 1(3), the Central Government brings provisions into force by notification, and different dates can be fixed for different provisions. India Code records 9 October 2023 as the enforcement date, and the first notification brought in a limited set of sections (including the definitions in section 3 and the provisions on the Mediation Council of India). The Act has therefore come into force in stages. Before you rely on any particular section in practice or in a moot, check the current commencement status on India Code. Section 56 also says the Act does not apply to mediation or conciliation that began before it came into force.

What does the Act actually change?

Before 2023, mediation in India rested on scattered sources: section 89 of the CPC, court-annexed mediation rules, Part III of the Arbitration and Conciliation Act (conciliation) and a few special statutes. The new Act pulls this together. The main changes are:

• Pre-litigation mediation is voluntary. Section 5(1) lets parties try mediation by mutual consent before filing a civil or commercial suit. The original Bill had proposed making it compulsory. For commercial disputes of Specified Value, section 12A of the Commercial Courts Act, 2015 continues to govern.
• Fixed time limit. Under section 18, mediation must be completed within 120 days from the date fixed for the parties' first appearance before the mediator. The parties can agree to extend this by up to 60 more days, so 180 days is the outer limit.
• Enforceable outcome. Section 27 makes a mediated settlement agreement final and binding, enforceable under the CPC as if it were a decree of court.
• Narrow challenge. Section 28(2) limits challenges to fraud, corruption, impersonation, or mediation of a dispute not fit for mediation. The challenge must be filed within 90 days of receiving the settlement, with a further 90 days possible for sufficient cause.
• Limitation protected. Section 29 excludes the period from the start of mediation (section 14) until the non-settlement report (section 21) or termination (section 24) when computing limitation under the Limitation Act, 1963.
• Online mediation. Section 30 allows mediation by video or audio conference, secure chat or encrypted email, with written consent of the parties.
• Conciliation folded in. The Sixth Schedule replaces sections 61 to 81 of the Arbitration and Conciliation Act, and references to conciliation are read as mediation under the new Act.

Which disputes cannot be mediated?

Section 6 and the First Schedule list matters not fit for mediation. These include claims against minors, deities and persons with mental illness or intellectual disability, suits for a declaration of title against the Government, prosecution for criminal offences, disputes affecting the rights of third parties (with an exception for matrimonial disputes involving a child's interest), disciplinary proceedings against regulated professionals, and specified tax, competition, telecom, electricity, securities and land acquisition matters. Under the proviso to section 6(1), a court may still refer compoundable offences, including compoundable matrimonial offences, to mediation. The result is not treated as a decree under section 27(2); the court considers it further under the applicable law. Since 1 July 2024 compounding is governed by section 359 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS), which replaced section 320 of the CrPC, so read the two together. Section 26 keeps Lok Adalats and Permanent Lok Adalats outside the Act.

How does a mediation run under the Act?

1. Choose a mediator. Parties may agree on one (section 8). If they cannot, a mediation service provider appoints one within seven days.
2. Disclosure. Under section 10, the mediator must disclose any conflict of interest in writing.
3. The sessions. Section 15(5) says the mediator is not bound by the CPC or the Indian Evidence Act, 1872. That Evidence Act has since been replaced by the Bharatiya Sakshya Adhiniyam, 2023 (BSA), so expect the reference to be read accordingly. Under section 16(2) the mediator must tell the parties expressly that they only facilitate and cannot impose a settlement.
4. Confidentiality. Section 22(2) bars any audio or video recording, and section 22(3) stops parties from relying on admissions, proposals or documents prepared for the mediation before any court, tribunal or arbitral tribunal. Section 23(2) lifts privilege for threats to commit an offence, domestic violence, child abuse and serious threats to public health or safety.
5. Settlement or report. A settlement is reduced to writing, signed by the parties and authenticated by the mediator (section 19). If there is no settlement, the mediator files a non-settlement report that does not give reasons (section 21).
6. Optional registration. Section 20 allows the parties to register a pre-litigation settlement with a Legal Services Authority or a notified body within 180 days of receiving the authenticated copy. Registration is optional and does not affect enforcement under section 27.

Take a simple example. Two brothers in Nagercoil disagree over running a family shop. They agree to mediate online, settle in eight weeks, and sign an agreement authenticated by the mediator. If one brother later refuses to comply, the other can execute it under the CPC like a decree, without filing a fresh suit.

What is community mediation?

Sections 43 and 44 deal with disputes likely to affect peace and harmony among residents or families of an area. With mutual consent, any party may apply to the Legal Services Authority, or where none exists, to the District Magistrate or Sub-Divisional Magistrate, who constitutes a panel of three community mediators. A water-sharing quarrel between neighbours on a Madurai street is the kind of matter this is built for. One point students often miss: under section 44(4), a community mediation settlement is not enforceable as a decree of a civil court. Students interested in this work can see how it runs on the ground through the college legal aid clinic.

Who regulates mediators?

Section 31 provides for the Mediation Council of India, a body corporate headquartered in Delhi. Its functions under section 38 include registering mediators, recognising mediation service providers and institutes, setting ethical standards and maintaining an electronic depository of mediated settlement agreements. Under section 40, Legal Services Authorities and court-annexed mediation centres are treated as mediation service providers. Section 57 keeps existing court-annexed mediation rules in force until the Council's regulations take over.

How should you write about it in an exam?

• Open with the definition of mediation in section 3(h), which says the mediator "does not have the authority to impose a settlement upon the parties to the dispute."
• Explain the structure: section 5 (pre-litigation), section 7 (court referral), section 18 (time limit), sections 27 and 28 (enforcement and challenge).
• Contrast mediation with arbitration (an award is imposed) and with Lok Adalat (excluded by section 26).
• Note section 55: the Act overrides inconsistent laws on mediation, except those in the Second Schedule, such as the Family Courts Act, 1984 and the Legal Services Authorities Act, 1987.
• Close with an evaluation: voluntariness, the 120 day limit and enforceability are strengths; the phased commencement and the absence of a route to enforce settlements from international mediations held outside India are commonly discussed limitations.

For case law, use the judgments listed in your prescribed ADR syllabus and confirm each citation on the Supreme Court or Madras High Court website before quoting it.

Sources

• The Mediation Act, 2023 (Gazette of India): the official text of Act No. 32 of 2023 as published on 15 September 2023.
• The Mediation Act, 2023 on India Code: the government database record, including the enforcement date.
• International Bar Association commentary: a secondary analysis of the Act's strengths and gaps, including international settlements.