The Mediation Act 2023: what it means in practice

TL;DR: The Mediation Act 2023 received Presidential assent in September 2023 and gives India its first standalone statute governing mediation. It makes mediated settlement agreements enforceable as if they were court decrees, establishes the Mediation Council of India as the regulatory body, and formally recognises online and community mediation. The original draft proposed mandatory pre-litigation mediation for commercial disputes, but the enacted version adopted a substantially voluntary framework. If you are a litigant, counsel or in-house lawyer, this Act changes your pre-suit calculus in ways that deserve careful attention.

What the Act does and why it matters
Mediation vs arbitration vs litigation - a comparison
Scope and applicability
Voluntary mediation and the shift from the original draft
The pre-litigation mediation framework
What is a mediated settlement agreement
How mediated settlement agreements are enforced
The Mediation Council of India
Online mediation and community mediation
Confidentiality under the Act
Time limits for completing mediation
Where mediation fits - commercial, family and civil disputes
Practical tips for parties and counsel
How legal AI tools support mediation strategy
Frequently asked questions

What the Act does and why it matters

India’s courts carry one of the heaviest caseloads in the world. At any point, tens of millions of cases are pending across district courts, High Courts and the Supreme Court. Successive Law Commission reports, the Malimath Committee, and a string of parliamentary committee findings have pointed to the same structural answer: more disputes need to be resolved outside of formal adjudication.

Mediation has existed in India for decades, used within the Civil Procedure Code framework and under various court-annexed schemes. What was missing was a coherent statute that defined how the process works, gave mediators a clear legal standing, and - critically - made any settlement reached through the process genuinely enforceable without the parties having to return to court to get a decree.

The Mediation Act 2023 fills that gap. It arrived after years of consultation, a 2021 draft that attracted significant criticism (largely around its proposed mandatory pre-litigation mediation clause), and a revised version that balanced the goal of encouraging settlements with the practical concern that forcing parties to attempt mediation before filing could create procedural delays in time-sensitive matters.

The Act is not a revolution in dispute resolution philosophy. It codifies and formalises much that was already being done under court-annexed mediation programmes. But codification matters enormously in the Indian legal context. It sets uniform standards, creates a regulatory architecture, and - through the enforceability of mediated settlement agreements - gives the process teeth that it previously lacked.

Mediation vs arbitration vs litigation

Before diving into the Act’s specifics, it helps to be precise about what mediation actually is and how it sits alongside the other options available to disputing parties.

Feature	Mediation	Arbitration	Court litigation
Decision-maker	Parties themselves, with mediator facilitating	Arbitrator(s) issue a binding award	Judge issues a binding judgment
Binding outcome	Only if both parties agree and sign MSA	Yes - award is binding	Yes - decree is binding
Confidentiality	High - proceedings are confidential by law	Moderate - depends on seat rules and agreement	Low - most proceedings are public
Speed	Typically weeks to a few months	Months to years	Years to decades in India
Cost	Generally low	Moderate to high	Low filing cost but high time cost
Flexibility	Very high - parties control outcome	Moderate - governed by agreement and Arbitration Act	Low - procedural rules fixed
Appellate risk	None if MSA executed	Limited grounds under Section 34 of the Arbitration Act	Full appellate hierarchy available
Relationship preservation	High - process is collaborative	Low - adversarial	Low - adversarial
Enforceability	Decree-like under the 2023 Act	Award enforceable as decree	Decree directly enforceable
Best for	Ongoing relationships, family disputes, commercial disputes where deal-preservation matters	High-value disputes, international contracts	Matters requiring precedent, public law, criminal

The core thing to understand is that in mediation the mediator does not decide anything. The mediator structures conversation, identifies interests beneath the stated positions, and helps parties find a zone of possible agreement. If they find it and sign a mediated settlement agreement (MSA), that document has legal force. If they do not, the parties are free to proceed to arbitration or litigation with nothing from the mediation session admissible against them.

That last point - confidentiality - is what makes mediation particularly attractive for commercial parties. A failed mediation leaves no footprint on the dispute record.

Scope and applicability

The Act applies to mediations conducted in India where the dispute is of a civil or commercial nature. It covers disputes that are the subject of pending litigation as well as disputes where no proceedings have yet been filed. Mediations conducted under a contract that specifically refers to the Act, court-referred mediations, and mediations conducted through established mediation service providers all fall within its ambit.

There are explicit exclusions. The Act does not apply to:

Disputes relating to claims against minors or persons of unsound mind
Criminal offences
Matters affecting rights of third parties who are not part of the mediation
Disputes concerning public law rights, except where specifically permitted
Certain categories of disputes where the government or a public body is a party, although the Act does contain provisions contemplating government participation in mediation under separate notification

International commercial mediation - where at least one party is habitually resident or incorporated outside India, or where a substantial part of the obligations are performed abroad - is also covered by the Act, which brings India into alignment with the Singapore Convention on Mediation (the UN Convention on International Settlement Agreements Resulting from Mediation). India is a signatory to that Convention, and the Act’s enforceability provisions are structured partly to meet its requirements.

Voluntary mediation and the shift from the original draft

This is where the legislative history deserves careful attention, because the final Act differs materially from what was first proposed.

The 2021 draft Mediation Bill proposed that parties to commercial disputes of the kind covered by the Commercial Courts Act 2015 would be required to attempt mediation before filing suit. This was a bold proposal and attracted considerable pushback from the bar and from commercial litigants. The concern was practical: if a party is facing an urgent breach of contract, a threat of asset dissipation, or a situation requiring interim injunctive relief, a mandatory mediation window before filing could cause real harm. Courts granting ad-interim orders depend on the plaintiff having come to court promptly.

The enacted version of the Act responded to this concern. Pre-litigation mediation under the Mediation Act 2023 is largely voluntary rather than mandatory. The Act creates a framework within which parties can agree to attempt mediation before approaching a court, and it provides procedural support for that process (including time limits and a designated institutional home), but it does not impose an obligation on parties to commercial disputes to exhaust mediation before filing.

This is a significant distinction. It means:

Parties who want to mediate can do so under a clear statutory framework with enforceable outcomes.
Parties who do not want to mediate are not forced into a process they may regard as pointless or tactically disadvantageous.
Lawyers advising clients at the pre-dispute stage need to be aware of the framework as an option, not as a compliance hurdle.

The Act does retain a provision enabling courts to refer disputes to mediation at any stage of proceedings. This is consistent with the existing power under the Civil Procedure Code and was already being exercised through court-annexed mediation centres. The Act now places that referral power on firmer statutory ground and connects it to the MSA enforcement machinery.

Some commentators have argued that the shift to voluntary pre-litigation mediation weakens the Act’s ambition. The counter-argument is that a mediation conducted under genuine party willingness is far more likely to succeed than one entered into grudgingly as a procedural prerequisite. The empirical evidence from countries with well-developed mediation cultures supports this view. Voluntary participation, combined with skilled mediators and legally enforceable outcomes, tends to produce higher settlement rates than compelled attendance.

The pre-litigation mediation framework

Even though pre-litigation mediation is not mandatory, the Act establishes a clear process for parties who wish to use it. Understanding this process matters because it gives counsel a structured pathway to offer clients before a dispute escalates to litigation.

Under the Act’s framework, parties can agree in their underlying contract that disputes will be referred to mediation before litigation. They can also agree at the point when a dispute arises, even without a pre-existing clause. A mediation service provider - a body recognised under the Act and eventually to be accredited by the Mediation Council of India - administers the process.

Once the parties agree to attempt pre-litigation mediation, the Act imposes a time discipline that was absent from earlier informal mediation arrangements. Mediation must ordinarily be completed within a specified period from the date of the first session (discussed further under time limits below). If no settlement is reached within that period, the parties receive a non-settlement report and are free to proceed with litigation.

For counsel, the pre-litigation framework creates a useful structure to recommend to clients when:

The parties have an ongoing commercial relationship they wish to preserve
The dispute involves a relatively defined quantum and a relatively confined set of issues
Both parties are legally represented and have the capacity to engage in structured negotiation
The subject matter is not one requiring urgent interim relief

Where any of those conditions is absent - particularly urgency - the litigation route may be preferable, and the Act does not stand in the way.

What is a mediated settlement agreement

A mediated settlement agreement (MSA) is the document signed by the parties at the conclusion of a successful mediation. It records what the parties have agreed - the terms of resolution, any payment obligations, any non-monetary commitments, timelines for performance, and whatever else forms the bargain.

Under the Mediation Act 2023, an MSA must be in writing and signed by the parties and authenticated by the mediator. The authentication requirement is important: it distinguishes the MSA from an ordinary contractual settlement, which would only be enforceable through a fresh suit for breach of contract if one party reneges.

The Act requires that an MSA be registered with the authority or body specified for this purpose - in practice, through the mediation service provider or a designated court registry - within a stipulated period after signing. Registration is the gateway to the enhanced enforcement mechanism.

Once registered, the MSA cannot be challenged on the grounds that would ordinarily allow a party to resist performance of a contract. The grounds for challenge are narrow and mirror the public policy exceptions familiar from arbitration law: fraud, corruption, impersonation, or a provision that is void or voidable under any law in force. A party seeking to challenge a registered MSA must approach the relevant court within a specified period and on one of those specified grounds. Outside those grounds, the document stands.

This is the core innovation of the Act. It removes the enforcement gap that made earlier mediated settlements less attractive than court decrees or arbitral awards. Under the earlier regime, if Party A settled with Party B through mediation and B subsequently refused to pay, A had to file a fresh suit for breach of the settlement agreement. That suit could take years. Under the 2023 Act, a registered MSA can be enforced as if it were a decree of a court - the full machinery of execution proceedings is available without a fresh round of adjudication.

How mediated settlement agreements are enforced

The enforcement mechanism deserves a more granular explanation because it represents the most practically significant change the Act introduces.

The starting point is that a registered MSA has the same legal force as a decree of a civil court. This is not a loose analogy - the Act uses language modelled on the finality that attaches to arbitral awards under the Arbitration and Conciliation Act 1996, adapted for the mediation context.

To enforce an MSA, the benefiting party applies to the court having jurisdiction as if it were seeking execution of a decree. The court does not re-examine the merits of the settlement. It does not ask whether the settlement was fair, whether the parties had good legal advice, or whether a different outcome might have been better. Its inquiry is limited to whether a valid registered MSA exists, whether the applicant is entitled to the remedy claimed under it, and whether any of the narrow grounds for challenge have been made out.

The practical implication is that enforcement proceedings under the Act should be significantly faster than a fresh suit. The execution court’s jurisdiction is confined, the grounds for opposition are narrow, and the procedural framework is designed for efficiency.

For parties on the receiving end of an MSA enforcement application, it is critical to understand that the standard defences available in ordinary civil litigation are not available at this stage. If the settlement was entered into under duress, or if the mediator engaged in misconduct, or if there was fraud in the mediation process, those are matters to be raised as challenges to the MSA itself within the statutory period - not as defences in execution. Missing that window is likely fatal.

This underlines why legal counsel needs to be actively involved throughout the mediation process, not merely at the drafting stage. A party that signs an MSA without understanding its terms, or without appreciating that the document will be nearly final once registered, is in a difficult position later.

The Mediation Council of India

The Act establishes the Mediation Council of India as a statutory body to oversee and develop the mediation ecosystem. This is an important institutional development, not merely an administrative footnote.

Before the Act, mediation in India was practised through a patchwork of institutions: court-annexed mediation centres, the Indian Institute of Arbitration and Mediation, the Mediation and Conciliation Project Committee of the Supreme Court, and various private mediation service providers. Standards for mediator training, accreditation and conduct varied considerably across these bodies.

The Mediation Council of India is tasked with:

Recognising and accrediting mediation service providers
Setting standards for mediator training and certification
Maintaining a register of recognised mediators
Promoting mediation as a dispute resolution mechanism
Conducting research and publishing data on mediation outcomes

The Council’s accreditation function is particularly significant for parties choosing a mediation service provider. Once the Council is fully operational and issuing accreditations, parties and counsel will have a reliable basis for identifying institutions and individual mediators who meet minimum competency standards. This matters because the quality of the mediator is the single most important variable in mediation outcomes.

The Council’s composition under the Act includes a chairperson with judicial or legal experience, members with expertise in law and mediation, and representatives of the Central Government. It is intended to be an independent body, analogous in some respects to the Bar Council of India for advocates, operating at arm’s length from the government while exercising quasi-regulatory functions.

Online mediation and community mediation

Two categories of mediation receive specific recognition in the Act: online mediation and community mediation.

Online mediation is defined as mediation conducted through digital means - video conferencing, electronic communications, or other technology-based platforms. The Act expressly permits online mediation and treats it as equivalent to in-person mediation for all purposes, including the validity and enforceability of any MSA reached through the process.

This is significant given India’s geographic scale and the cost barriers that face parties in smaller commercial disputes or family matters. A business dispute between parties in Chennai and Chandigarh, or a property disagreement involving family members spread across cities, can now be mediated without requiring everyone to travel to a single location. Online mediation also opens the possibility of cross-border mediations involving Indian parties without the logistical complexity of bringing everyone to a single jurisdiction.

The Act does not impose specific technical standards for online mediation platforms, leaving that to the Mediation Council to develop through regulations. This is sensible in a fast-moving technological environment, but it also means there will be a gap in standardisation until the Council issues guidance.

Community mediation addresses a distinct need - disputes that affect the peace and harmony of a community or neighbourhood, rather than purely bilateral commercial or civil matters. The Act contemplates that community mediations will be conducted by panels including persons with local knowledge and community standing, operating under the general framework of the Act. This recognises that many disputes in India - particularly those involving land, water use, neighbourhood relations, and similar matters - have dimensions that formal adjudication handles poorly and that purely bilateral mediation also misses.

Confidentiality under the Act

Confidentiality is one of mediation’s core features and one of the reasons commercial parties choose it over court proceedings. The Mediation Act 2023 puts confidentiality on a clear statutory footing.

The Act imposes confidentiality obligations on the mediator, on the parties, and on any persons present during mediation proceedings. Information shared in the course of mediation - including proposals made, positions taken, documents exchanged, and admissions or concessions made by any party - cannot be disclosed outside the mediation or used in any subsequent court or arbitral proceedings.

The mediator is specifically prohibited from being compelled to give evidence about what occurred in mediation, and any communications made for the purpose of the mediation are protected from disclosure.

There are narrow exceptions - disclosure may be required where it is necessary to prevent a crime, where a court orders disclosure in the interests of justice on very limited grounds, or where the parties themselves agree that a specific piece of information may be shared. But the default position is strict confidentiality.

For counsel advising clients considering mediation, this confidentiality protection is often decisive. A party that candidly discusses the weaknesses of its position in order to reach a negotiated resolution needs assurance that those candid discussions will not appear in the opposing party’s written submissions if mediation fails. The Act provides that assurance with statutory force.

Time limits for completing mediation

One of the criticisms historically levelled at mediation in India is that, without firm time limits, it could become just another procedural step that adds delay without producing resolution. The Act addresses this by imposing time discipline on the process.

Under the Act, mediation must ordinarily be completed within 180 days from the date of the first session. The parties may, by mutual agreement, extend this period by a further 180 days. Beyond that, if no settlement has been reached, the mediation concludes and the parties receive documentation permitting them to proceed with litigation or arbitration.

This outer limit of approximately one year is long by international standards but is calibrated to Indian conditions, where parties may need time to gather documents, consult advisers, and navigate internal approval processes (particularly where one party is a company or public sector enterprise). In practice, most commercial mediations conducted by competent mediators with willing parties resolve well within 180 days - often within a handful of sessions spanning a few weeks.

For court-referred mediations, the time limits are tighter. Courts referring matters for mediation typically set a specific period for the mediation to run, after which the matter returns to the court’s board if no settlement has been reached. The Act’s framework complements these court-specific directions rather than displacing them.

The time limit provisions also have an implication for limitation. The Act provides that the period during which mediation is pending under its framework is excluded from the computation of limitation for the purposes of any subsequent court proceedings. This prevents the concern - valid under an informal mediation regime - that engaging in mediation might cause a party to inadvertently allow its limitation period to expire.

Where mediation fits

The Act does not prescribe which kinds of disputes should go to mediation. That is left to the parties and their advisers. But based on the Act’s framework and the experience of court-annexed mediation in India, certain categories of dispute are well-suited to the process.

Commercial disputes - particularly those arising from ongoing supply contracts, distribution agreements, joint ventures, and real estate transactions - are strong candidates. The parties typically have a clear financial interest in reaching a resolution quickly, they have already established a working relationship, and the economic stakes are usually quantifiable. Research-backed insight into the likely range of outcomes in litigation can sharpen a party’s sense of its BATNA (best alternative to a negotiated agreement) and make mediation conversations more productive.

Family law matters - particularly disputes around matrimonial property, maintenance, and child custody - benefit enormously from mediation’s flexibility and confidentiality. Court proceedings in family matters are adversarial by design, which can deepen conflict and make post-resolution co-parenting or family relations harder. Mediation can address the relational dimension alongside the legal one. For more on how Indian family law intersects with dispute resolution, our post on prolonged separation and mental cruelty as grounds for divorce provides useful context on how courts currently approach contested family matters.

Landlord-tenant disputes, neighbourhood and property boundary disputes, and disputes between business partners or co-founders are all areas where the informal and flexible nature of mediation is well-matched to the complexity of the underlying relationship.

Employment disputes - particularly those involving wrongful termination or workplace harassment claims where both parties have an interest in avoiding public proceedings - are increasingly being referred to mediation, and the Act’s confidentiality provisions make this option more attractive.

What mediation is less suited for: matters where one party seeks to establish a legal precedent, disputes involving criminal conduct, cases where one party is in severe financial distress and needs immediate coercive enforcement, and matters where there is a significant power imbalance that mediation cannot adequately address. For these, the courts remain the appropriate forum, and the Act is careful not to suggest otherwise.

Practical tips for parties and counsel

The Act creates opportunities, but those opportunities need to be actively harvested. Here are the practical implications for parties and their legal advisers.

For counsel drafting contracts: Include a mediation clause that specifies the applicable rules, the mediation service provider (or basis for selecting one), the seat, and the language of mediation. The Act’s framework works best when the parties have agreed on these logistics in advance rather than negotiating them at the point of crisis. For guidance on drafting notices and dispute-related clauses, our legal notice drafting guide covers the structural elements that transfer to pre-mediation correspondence.

At the point of dispute: Assess early whether the dispute has features that make mediation attractive - ongoing relationship, quantifiable claim, willing counterparty, no urgent interim relief required. If so, send a formal mediation invitation with reference to the Act. The invitation itself signals seriousness and can sometimes trigger direct settlement discussions without needing a formal mediator.

Choosing a mediator: Until the Mediation Council of India’s accreditation system is fully operational, check the mediator’s training, track record in your subject area, and institutional affiliation. A mediator with domain expertise in commercial contracts or family law brings a different toolkit than a generalist, and the choice matters.

Preparing the mediation brief: Unlike court pleadings, a mediation brief is not designed to win arguments. It is designed to help the mediator understand the dispute, the parties’ core interests (as distinct from stated positions), and the range of acceptable outcomes. Prepare it differently from a plaint or written statement.

Reviewing the MSA before signing: The Act makes a registered MSA enforceable as a decree. Treat it with the same care as you would treat a consent decree or a final settlement agreement in a high-stakes commercial matter. Have counsel review it line by line before it is authenticated by the mediator and presented for registration.

Limitation tracking: Record the date on which mediation commenced and ensure that the limitation exclusion under the Act is properly documented if mediation fails and litigation follows.

How legal AI tools support mediation strategy

One aspect of mediation preparation that is often underestimated is the research work that goes into assessing the strength of a legal position. A party that enters mediation without a realistic assessment of how its case is likely to fare in court is poorly positioned to make good decisions about settlement. It may hold out for terms that are genuinely available in court, or it may concede too quickly on positions that would have held up.

This is where retrieval-grounded legal research changes the calculus. Niyam’s research tool searches across 72,000+ Indian judgments to surface relevant precedents on the specific legal question at issue - whether that is the interpretation of a liquidated damages clause, the standard for mental cruelty in matrimonial proceedings, the doctrine of frustration in a contract dispute, or the threshold for specific performance in a real estate matter. The research is grounded in the actual text of Indian decisions rather than generated from training data, which significantly reduces the risk of hallucinated citations - a problem documented in our post on AI-hallucinated citations in Indian courts.

Armed with a realistic picture of the litigation landscape, a party’s counsel can:

Advise credibly on the BATNA - what the party is likely to achieve if it proceeds to court
Identify the weaknesses in the opponent’s position that a skilled mediator will probe
Set realistic ranges for settlement discussions based on what courts have actually awarded in comparable cases
Draft the MSA with precision, using language that accurately captures the agreed outcome and will withstand an enforcement challenge

For practitioners handling arbitration matters that may involve parallel mediation, our arbitration in India guide covers the interaction between these two processes, including how arbitral proceedings can be stayed pending mediation.

Niyam’s drafting tool also supports the preparation of mediation-related documents - from the initial letter requesting mediation, through the mediation brief, to the final MSA. The notices tool handles pre-mediation formal communications, which often set the tone for whether the other party will engage constructively.

The broader point is that mediation strategy is not a soft alternative to legal preparation - it is legal preparation applied differently. The underlying research into applicable law, precedent, and likely outcomes is at least as important in mediation as in litigation. It just gets used differently: to inform negotiation rather than to construct arguments for a court.

Frequently asked questions

What is the Mediation Act 2023?

The Mediation Act 2023 is India’s first standalone statute governing the mediation process. It received Presidential assent in September 2023. The Act defines mediation, establishes procedural requirements for conducting it, creates the Mediation Council of India as a regulatory body, and - most significantly - makes mediated settlement agreements enforceable as if they were court decrees.

Is pre-litigation mediation mandatory under the Act?

No. This is one of the most commonly misunderstood aspects of the Act. The original 2021 draft proposed mandatory pre-litigation mediation for commercial disputes, but the enacted version adopted a largely voluntary framework. Parties may choose to attempt mediation before filing suit, and the Act provides a clear process for doing so, but there is no general statutory obligation to exhaust mediation before approaching a court.

What disputes can be resolved through mediation under the Act?

The Act covers civil and commercial disputes of a wide variety - contract disputes, property matters, family law matters (with certain exceptions for matters affecting third parties or persons who cannot consent), employment disputes, and others. It does not apply to criminal offences or to certain categories of public law matters. International commercial disputes where at least one party is outside India are also covered, which aligns with India’s obligations under the Singapore Convention on Mediation.

What is a mediated settlement agreement (MSA)?

An MSA is the written document signed by both parties at the conclusion of a successful mediation, recording the terms of their resolution. Under the Act, an MSA must be authenticated by the mediator and registered within the specified period. Once registered, it is enforceable as a court decree and can only be challenged on narrow grounds (fraud, corruption, impersonation, or a provision that is void or voidable under applicable law).

How is an MSA enforced?

A registered MSA is enforced through execution proceedings in a civil court, in the same way as a court decree. The court does not re-examine the merits of the settlement. The grounds on which enforcement can be resisted are narrow and must be raised through a formal challenge to the MSA within the statutory time limit - not as a defence in execution proceedings.

What is the Mediation Council of India?

The Mediation Council of India is a statutory body established under the Act to regulate and develop mediation in India. Its functions include recognising and accrediting mediation service providers, setting standards for mediator training and certification, maintaining a register of mediators, and promoting mediation as a dispute resolution mechanism. It is intended to bring uniform standards to a previously fragmented landscape of mediation institutions.

How long does mediation take under the Act?

The Act requires that mediation be completed within 180 days from the date of the first session. The parties can extend this by a further 180 days by mutual agreement. If no settlement is reached within the applicable period, the mediation concludes and the parties may proceed with litigation or arbitration. In practice, many commercial mediations resolve considerably faster than 180 days.

Is mediation confidential under the Act?

Yes. The Act imposes confidentiality obligations on mediators, parties, and any persons present during mediation. Information shared in mediation - including positions, proposals, admissions, and documents - cannot be used in subsequent court or arbitral proceedings. The mediator cannot be compelled to give evidence about what occurred. There are narrow exceptions involving prevention of crime or court orders in the interests of justice, but the default position is strict confidentiality.

Can mediation be conducted online under the Act?

Yes. The Act expressly recognises online mediation conducted through digital means including video conferencing. Online mediation is treated as equivalent to in-person mediation for all purposes, including the validity of any MSA reached. This is significant for disputes involving parties in different cities or, in the case of international commercial mediation, in different countries.

What is community mediation under the Act?

Community mediation is a category of mediation recognised by the Act for disputes that affect the peace or harmony of a community or neighbourhood, rather than purely bilateral matters. Community mediations are conducted by panels that may include persons with local knowledge and community standing, under the Act’s general framework. It addresses the gap between bilateral mediation and the communal dimension of many disputes in India.

How does the Act affect the limitation period?

The Act provides that the period during which mediation is pending under its framework is excluded from the computation of limitation for the purposes of any subsequent court proceedings. This prevents a party from inadvertently losing its right to sue by engaging in mediation in good faith. It is important to document the commencement and conclusion of mediation precisely for limitation purposes.

Can courts refer existing litigation to mediation under the Act?

Yes. Courts retain the power to refer disputes pending before them to mediation at any stage of proceedings. The Act places this referral power on clearer statutory footing and connects it to the MSA enforcement machinery. A settlement reached through court-referred mediation can be registered and enforced as an MSA under the Act.

What happens if mediation fails?

If mediation fails to produce a settlement within the applicable time limit, the parties receive documentation confirming the non-settlement. They are then free to proceed with litigation or arbitration as they choose. Nothing said or disclosed in the mediation can be used against any party in those subsequent proceedings. The failed mediation leaves no adverse legal footprint.

How does mediation under the Act differ from conciliation under the Arbitration Act?

Conciliation is governed by Part III of the Arbitration and Conciliation Act 1996. Mediation under the 2023 Act and conciliation under the 1996 Act are similar in structure - both involve a third-party facilitator helping parties reach a settlement - but the 2023 Act provides a more developed institutional framework, clearer confidentiality protections, the Mediation Council as a regulatory body, and an enforcement mechanism specifically designed for MSAs. In practice, the 2023 Act is expected to become the primary legislative home for structured mediation in India, though the conciliation provisions of the 1996 Act continue to apply in arbitration-related contexts.

Is a mediator the same as an arbitrator?

No, and the distinction is fundamental. An arbitrator hears evidence, considers submissions from both parties, and issues a binding award. The arbitrator decides the dispute. A mediator does not decide anything. The mediator facilitates conversation between the parties, helps them understand each other’s interests, and assists them in finding a resolution they can both accept. The outcome in mediation - if any - is entirely the product of the parties’ own agreement.

What qualifications does a mediator need under the Act?

The Act contemplates that the Mediation Council of India will set standards for mediator training and certification. Until the Council’s accreditation framework is fully operational, parties should look for mediators with recognised training (the International Mediation Institute, the Indian Institute of Arbitration and Mediation, and various law school programmes offer accredited courses), domain expertise in the relevant subject area, and a track record in structured commercial or family mediation.

Can the government or a public sector body be a party to mediation under the Act?

The Act contains provisions contemplating government participation in mediation, but with certain carve-outs and subject to conditions that may be specified by notification. This reflects the sensitivity around government entities settling disputes outside the normal framework of public accountability. As the Council develops its regulations and the government issues further notifications, this area is likely to develop further. For now, disputes involving government or public sector parties as defendants are often better suited to litigation or statutory adjudicatory mechanisms.

Can family law disputes be mediated under the Act?

Yes, in many cases. Disputes relating to matrimonial property, maintenance, and aspects of separation can be mediated under the Act’s framework. The Act excludes matters affecting the rights of persons who cannot consent (including minors and persons of unsound mind) and matters where third parties not participating in the mediation would be directly affected by the settlement. Child custody arrangements are a more complex area: while a mediated agreement on custody can be reached, it requires court approval before it binds the parties, because the court’s parens patriae jurisdiction over children cannot be contracted out. Our family law practice area page has more on how these considerations interact in practice.

How does a party initiate mediation under the Act?

Where there is a pre-existing mediation clause in the underlying contract, that clause will specify the initiation process - usually a written notice referring the dispute to mediation. Where there is no pre-existing clause, the parties can agree at the point of dispute to attempt mediation, select a mediation service provider, and commence proceedings under that provider’s rules and the Act’s framework. The Act does not require a court’s permission or involvement to initiate voluntary pre-litigation mediation.

Does the Mediation Act 2023 replace the existing court-annexed mediation programmes?

No. Court-annexed mediation programmes - which have operated under the Civil Procedure Code and under various High Court rules - continue. The Act supplements rather than replaces these programmes. It provides a statutory framework that court-annexed mediations can operate within, and connects court-referred mediations to the MSA enforcement mechanism. The Mediation Council will eventually set standards that apply across both voluntary and court-annexed mediations.

Start researching your mediation strategy today

The Mediation Act 2023 changes the pre-litigation calculus for Indian disputes in ways that every litigant and counsel needs to understand. But knowing the Act is only the first step - applying it effectively requires a clear-eyed assessment of how your matter would likely resolve in court, what the other side’s real interests are, and what settlement terms are actually achievable.

Niyam is Legal AI for India. Our research tool searches 72,000+ Indian judgments to surface precedents that sharpen your BATNA analysis. Our drafting tool helps you prepare mediation briefs, term sheets, and mediated settlement agreements with precision. Our notices tool handles the formal correspondence that starts and concludes the process. And our Citator helps you verify that the cases you are relying on are good law before you rely on them in any forum.

If you are a litigant considering mediation, or counsel advising one, the combination of the Act’s new enforcement machinery and retrieval-grounded legal research makes this an unusually powerful moment to explore settlement before proceedings begin.

When you are ready to try it: Start for ₹100 - 200 credits to start, cancel anytime. Questions: [email protected].