Part - III

CONCILIATION
[ Sections 61-81
]

Introduction
Conciliation is a process of persuading parties to reach to a settlement
Write short note is amethod adopted by the parties to a dispute to reach an amicable settlement
on : Conciliation. thereof by mutualcompromise with assistance of an independent third perses
M.U. Nov. 2012
June 2019
or institution. The Act provides for Conciliation ofdisputes under Sectinte &t
to 81.Conciliation can be adopted at any stage of the dispute. Parties are alss
What is concilia permitted to engage in conciliation process even while the arbitral proceedings
tion. are on.
M.U. Nov. 2009 Conciliation was afforded an elaborate codified statutory recognition in
Apr. 2010
Apr. 2011
Indiawith the enactment of the Arbitration and Conciliation Act, 1996 and Par
Apr. 2012
ll of the Act comprehensively deals with conciliation process in general. The
Nov. 2012 chapter on conciliation under the Arbitration and Conciliation Act, 1996 is
Nov. 2016 essentially based onthe UNCITRAL Conciliation Rules,1980.
Nov, 2017 The Halsbury's Laws of England defines Conciliation as "a process of
May 2023 persuading the parties to reach an agreement". Conciliation is a voluntary
process and the conciliator has no authority to impose on the parties a solution
Who can be con
ciliator. to the dispute. Like any other ADR process, conciliation is the mutual
M.U. Nov. 2017 determination of the parties to amicably resolve their disputes through an ADR
mechanism.
Conciliation is Conciliation is a voluntary and confidential process. Discussions mate
simple and impor- during the conciliation process are not binding on the parties unless a Seue
tant instrument for
settlement of dis is arrived at. The responsibility of a conciliator is to assists parties by helping
create
pute between the them to initiate and develop positive dialogue, clarify misunderstandings,resolve
parties. Comment. faith upon one another and generate an amicable atmosphere in orderto
M.U. Oct. 2015 their disputes. Like an Arbitrator, the conciliator must be an impartialperson.
The parties should be able to repose trust and confidence in himso asto
enable themtoshare their secrets and their thinking process with the conciliator
with the belief that the same withoutspecific
will not be divulged toother party proceedings
instructions in that
in such amannerregard. The conciliator may Conduct conciliationaccountthe
as he appropriate, taking intocoonciliatorhas
circumstances of the case considers
and parties. The conciliatoris
wide procedural discretion in the wishes of thesettlement. TheEvidenceAct
not bound by the Code of arriving towards a
1872. Civil
Procedure, 1908or the Indian
Communicale
The conciliator may parties C

with them orally or in invite the parties to meet him or maywith the
severaljpnt
writing.
together or with each of them He may or communicate
meet conciliator may'hold
separately.
The
200
 CONCILIATION 201

or private
cases and
meetings with
SO as to the parties so as to enable the parties to clarify their
solution/.settlement. persuade the parties to arrive at a mutually acceptable

Advantages of Conciliation
1. NO Prior
conciliation can beagreement necessary · Provisions of Part l relating to
invoked by parties having disputes arising out of legal
relationships whether
contractual not. No prior agreement is necessary for
resort to conciliation.
or
Conciliation
arbitration proceedings. In fact, thecan be availed of even during pendency of
Act
contains an express provisions under
Section 30 (1)to the effect that
encouragement
iibunal during the arbitral proceedings of conciliation by the arbitral
to help the parties arrive at a
2. Cost effective
process: settlerment.
And expeditious mechanism for Conciliation is an economical, cost effect
resolution
and arbitration, which makes it an of disputes in comparison to litigation
excellent
follows a simplified procedure suited to the ADR Mechanism. The conciliator
keeping in mind the need for speedy convenience of the parties and
settlement of the
Informal Proceedings : Conciliation has an dispute.
3.
proceeding to reconcile disputing parties to arrive at a advantage of informal
settlement which has a statutory sanction and compromise or negotiated
outside help. Usually,cordial relations which is arrived by minimum
at amicable and friendly terms continue to exist and the parties remain
after the compromise or settlement
4. Confidentiality :As opposed to agreement.
judicial
private process and therefore offers privacy proceedings conciliation is a
and confidentiality. In fact
Confidentiality in conciliation proceedings is a statutory guarantee. The
OnCiliator and the parties are supposed to keep confidential, all matters
Uhe concliation proceedings. The parties are also relating
precluded
"Onor introducing as evidence in subsequent arbitral or judicial
from relying
proceedings
Sexpressed or suggestions made by the other party in respect of a possible
setlement of tthe dispute, admissions made by the other party inthe Course of
toncliation proceedings, proposals made bythe conciliator andthe fact that
other partyhad indicated his willingnessto accept aproposalfor settlement
Inade by tthe conciliator. This makes concliation anit mandatory
excellent dispute resolution
hechanism.
and the partiesfact,
In makes
Section 75 ofthe Act, for the conciliator
to keep confidential all matters relating to the conciliation
rOce dings. Settlement Agreement : The settlement agreementit is
if
drawn up in
an arbitral

awaroncdiliation
has the same status and effect as
proceedings the dispute rendered by an
arbitral
on agreed terms on the substance of
Therefore, the settlement agreement in
bunal under section 30 of the Act.
court. Itis open to any party to
opplnycilfioathertionis
executable as a decree of the civil filing an execution petiton
execution offthe settlement
agreement by

ieiore' civil court.

202 THE ARBITRATION AND CONCILIATION ACT, 1996

6. Convenience of Parties/Party autonomy :Conciliation is flexible and

convenient. The parties are free to agree on the procedure to be followed by
the conciliator, the time and venue of the proceedings and thus eventually
control the process. The conciliator may conduct the conciliation proceedings
in such a manner as he considers appropriate, taking into account the
circumstances of the case, convenience of the parties and the wishes the
parties may express. Unless a party consents to the initiation and continuance
of conciliation and accepts the resultant settlement agreement he cannot be
said to be bound by the process, and he may withdraw from conciliation
proceedings at any time. This is unlike arbitration and litigation where decisions
therefore
can be made even ifa party does not wish to continue. The parties
also the final
not only control the procedure in conciliation proceedings but feature
outcome of the proceedings. Indeedparty autonomy is a very laudable
of conciliation.
International Commercial Conciliation
commercial
Article 1 (3) of the UNCITRAL Model law on International
whether referred to 5
conciliation defines as "conciliation" means a process,
expression of similar import
by the expression conciliation, mediation or an conciliator") to assist
wherebyy parties request a third person or persons ("the their dispute arising
them in their attempt to reach an amicable settlement of
relationship. The conciliatar
out of or relating to a contractual or other legal
a solution to the disput.
does not have the authority to impose upon the parties
International commercial
Article 1 (4) of the UNCITRAL Model law on
conciliation states that:
A conciliation is international if:
conciliate have, at the time of the
(a) The parties to an agreement to differant
conclusion of that agreement, their places of business in
States; or
is different
(b) The State in which the parties have their places of business
from either:
() The State in which a substantial part of the
obligations of the
cornmercial relationship is to be performed; or
() The State with which the subject matter of the dispute is
ost
closely connected.
The requirernent of internationality will be met it the parties atheothe
oncliation agreerment have their placos of businoss in different Stateseithet
tirne that the agreernent was concluded or whoro the State in which
substantial part of the obligations of the commercial relationship is o
closely
perforrned or with which the subject mattor of the dispute Is most
Connected differs from the State in which the partios have their placos
business. No strict definition of "commorcial" is provided in the Model La, h
 203
CONCILIATION
nlention beingthat relationships
risingfrom all legal the term be interpreted
of a commercial nature,
broadly to cover
So aswhether matters
contractual
ornot.

pifference
between Conciliation
arbitration
and Arbitration
Both, and conciliation are alternative means of settlement of
iSputes but they differ in the What is concilia
folowing aspects: tion? How is it dif
Conciliation ferent from arbitra
Arbitration tion? Discuss.
Conciliation is applicable only to 1.
existing disputes. Arbitration
as
is available for
existing M.U. Nov. 2001
well as future disputes. Apr. 2011
2 No prior agreement to submit to 2. Prior Nov. 2012
conciliation is necessary in case Agreement between the
of conciliation between the parties to submit existing or Write short note
parties. future disputes to arbitration is on: Difference be
necessary. tween conciliation
3. The party initiating conciliation 3. In an and arbitration.
shall send to the other party a arbitration agreement, the M.U. Nov. 2013
written invitation to conciliate, substance of dispute must be Nov. 2014
briefly identifying the subject of clearly mentioned. Usually, the Nov. 2016
the dispute. [Section 62] The parties incorporate a clause June 2018
invitation can be accepted or saying that any and all disputes
arising out of the contract must Distinguish be
rejected by the other party. be referred to arbitration and the tween arbitration
and conciliation.
4 Where the parties do
parties are bound by the same. M.U. Apr. 2010
not deter 4. Where the parties do not
mine the number of deter Nov. 2010
conciliators,
the act envisages that there mine the number of arbitrators, Apr. 2013
be sole shall the act envisages that there shall Apr. 2014
conciliator. However, the be sole arbitrator. However, there Oct. 2015
maximum numnber on case of is no bar on the maximum num May 2017
Conciliators cannot exceed three. ber of arbitrators provided it is not Nov. 2017
an even number. June 2018
S. In June 2019
case of appointment of three 5. In case of three arbitrators where
Conciliators, the two appointed no procedure is laid down or
Conciliators have no role in agreed upon for their
dppointing the third conciliator. appointment, the Act lays down
The parties appoint the third that the two appointed arbitrators
Conciliator who shall act as a shall appoint the third arbitrator
presiding conciliator. who shall act as a presiding
arbitrator.
S. 6. The role of the arbitrator is to go
Theassistrolethe ofparties
the conciliator is to
and help them through the pleadings, examine
both the
the evidence, hear
reach at ais settlement The the
parties, look into the merits of an
Conci l
directlyiator not allowed to
resolve the dispute
case and thereafter
pass
 THE ARBITRATION AND CONCILIATION ACI 1006
204

the
andrender a decision, but award. Arbitrator not only assists
parties of the dispute themselves parties but also makes actively
shall achieve an agreement resolves the disputes by making
conciliator. an arbitral award.
with the help of the
party has submitteci the
7. Aparty may withdrawat any time1. Once the
from the conciliation proceed disputes before an arbitral
tribunal, he cannot withdraw from
ings. the same.
are not permitter to
8 Aconciliator is allowed to discuss 8. Arbitrators
discuss the issues directly with
issues in dispute, develop
options andconsider alternatives the parties or generate options
a for terms of settlement or
to help the parties achieve negotiation. The arbitrator cannot
mutually agreeable outcome.
have private sessions with the
The conciliator can have private parties to the dispute.
sessions with the parties to the
dispute.
9. The pre agreement for arbitration
9. Since no pre agreements are must be in writing
required in conciliation, there is
no requirement need of the same
to be in writing.
10. Arbitration is aformal process
10. Conciliation is an informal pro andcan follow similar procedures
cess and normally involves a
detailed discussion. to court proceedings where
and
witnesses can be called
evidence can be presented to
argue the parties' respective
cases.
award is final and
11. Conciliation does not always|11. An arbitral of
ensure a mutually agreeable binding and hasthethe effect
arbitral
outcome will arise between the terminating
parties. proceedings.
proceed
12. The parties shall not initiate, dur 12. However, conciliation even during
ing the conciliation proceedings, ings can be initiated
any arbitral or judicial proceed the arbitral proceedings
ings in respect of a dispute that
is the subject-matter of the con
ciliation proceedings except that
a party may initiate
arbitral or
judicial proceedings where, in his
opinion, such proceedings are
necessary for
rights. [Section preserving his
77)
 CONCILIATION 205

13 Conciliator
S Subjected to certain 13. No such
disabilities
under Section 80 of disabilities
an arbitrator imposed on
the act and he cannot act as an or parties to arbitral
arbitrator or as a counselor a proceedings.
witness in any arbitral or judicial
proceedings.
14.The conciliation proceedings 14. The
cannot be used as evidence in
any arbitral or judicial proceed
arbitration
awards proceedings
may be used as
or
in any judicial evidence
ings.
us Aconciliator acts as an amicable proceedings.
compositeur to assist the parties 15. He can help decide ex aequo et
to reach a settlement. bono. An arbitrator
only if the parties can do So
thorize him to so expressly au
act or decide
46. If the parties reach
agreement on [section 28 (2)]
asettlement of the 16. An arbitral award shall be made
dispute, they
may draw up and sign in writing and shall be
settlement
a written the members of the signed by
agreement. If arbitral tri
bunal. The arbitral award
requested by the parties, the state the reasons upon shall
conciliator may draw up, or assist is which it
based. An award does not
the parties in
drawing up, the quire authentication.
re
settlement agreement. [Section
73 (2)]. The
authenticate conciliator shall
the settlement
agreement and furnish acopy
thereof to each of the parties.

pplication and scope [Section 61]

() Save as otherwise provided by any law for
the time being in
unless the parties have otherwise agreed, this Part shallforce and
apply to
Conciliation of disputes arising out of legal relationship, whether
Contractual or not and to all proceedings relating thereto.
(2) This Part shall not apply where by virtue of any lawfor the time being
in force certain disputes may not be submitted to conciliation.
Section 61 which deals with application and scope of the provisions, in
, interalia that save as otherwise provided by any lawfor the time being
nforce and unless the parties have otherwise agreed, this Part shall apply to
oncliattoion all
of disputes arising out of legal relationship, whether contractual or
proceedings relating thereto [Haresh Dayaram Thakur v/s State

Maharashtra AIR 2000 SC 2281].

 CONCILIATIO
THE ARBITRATION AND
206
It must be noted that this Part shall not apply on the following Scenarios:
(i) Where the provisions of this Part are made inapplicable by any law

for the time being in force;

agreed to exclude conciliatio.
(iü) Where the parties have expressly
in force specificall..
(ii) Where any other any law for the time bein9 conciliation
prohibits the submission of certain disputes to
which is governed by Part
Part Ill does not applyto arbitration
Section 30 (1) makes an exception and permits the arbitral tribunal to
conciliation duringthe atarbitration proceedings with the agreenent of
tl.However,
initiate
the
Therefore, Section 30 (1) uses the words "It is not incormpatible parties.
with
arbitration agreement for an arbitral tribunal to encourage settlement of t
dispute" This provision empowers the arbitral tribunal to suspend the arhit
proceedings if the parties agree to conciliation for resolving their disoute
such a case, the arbitrator can act as a conciliator and assist the parties in
informal manner in arriving at an amicable setlement. If the setlema
agreement is reached,the arbitration proceedings shall terminate.
Commencement of conciliationproceedings [Section 621
Write short note (1) The party initiating conciliation shall send to the other party a writen
on : Conciliation invitation to conciliate under this Part, briefly identifying the subject of
procedure.
M.U. Nov. 2016 the dispute.
Nov. 2019 (2) Conciliation proceedings shall commence when the other pary
accepts in writing the invitation to conciliate.
Write short note
on : Commence
(3) If the other party rejects the invitation, there will be no conciliation
ment of concilia proceedings.
tion proceedings. (4) If the party initiating conciliation does not receive a reply within thirty
M.U. Nov. 2017
days from the date on which he sends the invitaion, or within such
Explain in detail other periodof time as specified in the invitation, he may elect to treat
Conciliation pro this as a rejection of the invitation to conciliate and if he so elects, he
cedure. shall inform in writing the other party accordingly.
M.U. May 2017
Nov. 2019 The procedure for commencement of conciliaion is very simple. Apary
may, (at anytime even if the arbitration is pending) make an offer of conciliation
May 2023
to other, by an invitation in writing to conciliate under provisions of Part lIl of
the Act. However, the party makingthe proposal shall briefly identifythesubjec
Answer in one or
two sentences : of the dispute. If the other party accepts in writingthe invitation to conciliate
rejecis
Which date is con conciliation proceedings shall be commenced. However, if the other party
sidered as com replyIS
the invitation, there will be no proceedings. In case no elec'
mencement of conciliation may
conciliation pro received within 30 days of invitation, the party who makes anheoffer, elects, ha
ceedings. to treat this as a rejection of the invitation to conciliate and if so any ora
notedthat unde
M.U. Oct. 2015 shall informin writing the other party accordingly. It must be sufficient
considered
acceptance of an offer of conciliation shall not be
the provision of this Section.
 CONCILIATION
207

Unlikein arbitration; in conciliation, there can be no compulsion by law.

gnciliationproceedings begin only after appointment of conciliator while Explain : Concilia
tion procedure is
bitration begins only with service of notice under Section 21 of Arbitration more easy than
Hotel Pvt Ltd. vs Trade Wings Ltd. (2010) 1 RAJ 460 (Borm)| arbitration proce
dure.
One ofthe essential ingredients of the conciliation proceeding is that M.U. Apr. 2014
abodyshallbe forced to take part therein. It has to be voluntary in nature.
wherethhe genuineness of the claim itself is in dispute and the parties
vetaken extreme positions, the same prima facie may not be the subject
s0,

atteroffconciliation which provides for a non binding settlement. (United India

SUrance Co. Ltd. vs Ajay Sinha &Anr (2008) 7SCC 454]

mber of conciliators (Section 63)

This section provides that:
4) There shall be one conciliator unless the parties agree that there shall Answer in not
be two or three conciliators. more than two
sentences : How
(2) Where there is more than one conciliator, they ought, as a general many conciliators
rule, to act jointly. can be appointed
by the parties?
Once the invitation to conciliate is accepted by the other party, the parties M.U. Apr. 2014
lthen agree on the composition of the conciliation tribunal. i.e., the number Apr. 2016
onciliators. In absence of any agreement between the parties, there shall Nov. 2019
only one conciliator. However, the maximum number of conciliators shall
hree.

Ihis section further provides that if the parties opt for more than one
cliator, as a general rule, all the conciliators shall act jointly.
Dointment of conciliators [Section 64]
(1) Subject to sub-section (2), Answer in not
may agree
(2) inconciliation proceedings with one conciliator, the parties more than two
sentences: How is
on the name of a sole conciliator; conciliator ap
conciliators, each party may
) in conciliation proceedings with two pointed?
M.U. June 2019
appoint one conciliator;
conciliation proceedings with three conciliators, each party may
T in parties may agree on the name of
the Explain
CPpoint one conciliator and the presidingconciliator.
Appointment of

nird conciliator who shallact as the

conciliator.

of asuitable institution or personin M.U. June 2019

(2) Parties may enlist the assistance
in particular,
aection with the appointment of conciliators, andperson to recommend the
Write short note
institution or on Appointment
(a) an
a party may request such to act as conciliator; or of concillators.

nameS of suitable individuals appointment of one or more conciliators

M.U. Nov. 2011
Apr 2013
(b) the partiesmay agreethat theinstitution or person:
be made directly by such an
208
THE ARBITRATION AND CONCILIATION ACT 4n

Provided that in recommending or appointing

conciliator, the institution or person shall have individuals
to act
as
considerations as are likely to secure the regard to such
independent and impartial conciliator appointment
and, with respect to a an of
third conciliator, shall take into account the
advisability of sole or
aconciliator of a nationality other than the nationalities of
the
Conciliator can be appointed either by parties themselves or parties
apppointing
the assistance of a suitable institution or person. may enlist
Appointment of conciliator by parties
The parties may appoint conciliators as under:
(a) Sole conciliator : the parties may agree on the name of the
sole
conciliator.
(b) Two conciliators :each party may appoint one conciliator.
(c) Three conciliators : each party may appoint one
conciliator and the
parties may agree on the name of the third conciliator who shall act
as the presiding conciliator.
Assistance for appointment of conciliator
Parties may enlist the assistance of a suitable institution or
connection with the appointment of conciliators, and for this purpose.person in
(a) aparty may request Such an institution or person to
recommend the
names of suitable individuals to act as conciliator; or
(b) the parties may agree that the appointment of one or more
be made directly by such an institution or conciliators
person.
The above is however subject to a condition that
such
who makes an appointment, shall have regard to such institution person
or
likely to secure the appointment of an independent and considerations as are
is also obligatory on part of such impartial conciliator. It
institution or person to make the
conciliator, as the case may be,appointment
of sole conciliator or the third
internationalcommercial conciliation, of a person of nationality otherin case OT
of the parties. than th£t
If the foregoing
third conciliator by theconstraints are not observed, any
appointmnent of a sole
institution
have no binding effect on the
or person of the choice of the parties snall
parties.
In a case before the
Supreme Court, the
relatives. The Supreme Court suggested that dispute was between close
through conciliation. To this the parties such disputes should be resolved
Suprerne court was appointed as a agreed. Hence a retired judge of
concilator
conciliation [ Hari Shankar Singhania to resolve the
v/s Gaur Hari disputes through
2486) Singhania AIR 2006 SC
 CONCILIATION
209
Submission of
statements to
(1)The conciliator, upon conciliator [Section 651
submit to him a brief written his appointment,
may request each party to
dispute andthe points attissue.statement describing the general
to the other party. Each party shall send a nature of the
copy of such
(2)The conciliator may request each statement
statement of his
position and the factsparty to submit to him a
and grounds in further written
supplemented by any
appropriate. The party documents
shall
and other
evidence that support thereof,
such
send a copy of such party deens
other evidence to the
other
(3) At any stage of the party.
statement, documents and
anarty tosubmit to him suchconciliation proceedings, the conciliator may
additional information as he deems request
Explanation this section and all the
the term
: In appropriate.
"conciliator applies to a following sections of this
three conciliatorsPart,
the case may be. sole conciliator, two or
as
Once the conciliator is
him a brief written
statement appointed, he may request each party to
the points at issue.
The partydescribing
the general nature of
the
submit to
provide copy of the same to thesending such written statement, dispute has to
and
also
other party. In order to keep the
proceedings
do so in a
simple and speedy, the party conciliation
making the written statement
unambiguous and
statement as above, the otherself-explanatory manner. On receiving the shall
oher party reply thereto party may also send to the written
conciliator
setting out the details supporting his case. and the
After going through the written
nereto, the conciliator may need statement sent by a party and the reply
is purpose, the further information and documents and for
conciliator may alsO request each party to submit to him a
urther written statement of his position and the facts
and grounds in support
tdeems
hereof,appropriate.
Supplemented by any documents and other evidence that such party
Acopy of the information and other documents /evidence which the
Submits in response to the query of the conciliator shall also be sent toparty
ther party for their information and record. the

Conci l iator not bound by certain enactments [Section 66]

ne conciliator is not bound by the Code of Civil Procedure, 1908 (5 of
1908) or the Indian Evvidence Act, 1872 (1 of 1872).
As in the case of arbitral proceedings, as specified under Section 19 (1)
of the Act, applicability of the Code of Civil Procedure, 1908 (5 of 1908) or the
Indjian Evidence Act, 1872 (1also.of 1872) has been excluded from application of

CotefenCiactveiilldation the
if
proceedings The very purpose of conciliation
would be
rules under the Code
proceedings were governed bythe strict1872. The conciliation
1908 or the Indian Evidence Act,
Procedure,
 210 THE ARBITRATION AND CONCILIATION ACT. 190s

proceedings shall be governed by the principles of natural

intention of the legislature is clear that when parties have justice and the
some dispute resolved without intervention of courts,
observing then the decided
the strict rules underparties
to have
the should
have the matters decided without
Evidence Act which govern the Courts. CPC and
Role of conciliator [Section 67]
Explain the This section provides that:
provisions relating
to appointment of (1) The conciliator shall assist the
parties in an independent tand
conciliato rs and manner in their attempt to reach an amicable settlement of their impartial
the role of dispute.
(2) The conciliator shall be guided by principles of objectivity,
conciliator. fairness
M.U. Apr. 2010 and justice, giving consideration to, among other things, the rights and
Nov. 2010 obligations of the parties, the usages of the trade concerned and the
Apr. 2011 circumstances surrounding the dispute, including any previous business
Dec. 2018 practices between the parties.
(3) The conciliator may conduct the conciliation proceedings in such
Write short note
on : Role of
a manner as he considers appropriate, taking into account the circumstances
conciliator. of the case, the wishes the parties may express, including any request by a
M.U. Apr. 2017 party that the conciliator hear oral statements, and the need for a speedy
June 2018 settlement of the dispute.
May 2023
(4) The conciliator may, at any stage of the conciliation proceedings, make
Answer in brief : proposals for a settlement of the dispute. Such proposals need not be in
Conciliator's is the writing and need not be accompanied bya statement of the reasons therefo.
role of complete
trust and
The role of the conciliator under this section is categorized under 4parts
confidence which 1. Conciliator to be independent and impartial : The primary role ola
is maintained by Conciliatoris to make efforts which may assist the partiesto arrive at an amicable
.He is
legal provision. settlement of their disputes. He must act independently andimpartially.
Discuss.
in adopting
a
M.U. Nov. 2011 not guided by the principles of law and hence enjoys afree hand parties.
Apr. 2012 procedure which meets the convenience and approvals ofthepart ofthe
Independence and impartiality of conciliators is a Significant conciliator
Conciliation process. While independence rules out any interestoftopresent
in the dispute, impartiality allows equal parties
both
their case. opportunity for fairness
objectivity,
objectvy
2. Conciliator shall be guided by principles of consideration
of to-
and justice : The Conciliator shall be guide by the principles
fairness and justice and shall, among other things, give due
(() The rights and obligation of the
parties prevus

(i1) The usages and trade

concerned; and includingany
(ii) The
circumstances surrounding the
business
dispute,
practices between the partiesS.
 cONCILIATION 211

Oncethe COnciliator is provided with allthe datails regarding rights and

igationof the parties, trade practices, previous business practices between
epartieos etc.,it would become easier for himto persuade the parties to be
ttonalintheir approach and arrive at fair and reasonable settlement in the
terost of their business relations.
Concillator shall conduct proceedings falrly :One of the cardinal
ules of nAatural justice is that the Concllator should be fair, independent,
nanhial and shall give opportunity to both partles of being heard. The concilator
NRS been conferred with unfettered powers in adopting a procedure suitable to
ne parties, however he must adhere to the princlples of natural justice. He is
he to decide the manner of conducting the conciliatlon proceedings, taking
nto account the following factors:
() the circumstances of the case;
() the wishes the parties may express;
() any request by a party that the conciliator hear oral statements, and
(v) the need for a speedy settlement of the dispute.
The Conciliator shall afford adequate opportunity to the parties to present
ther respective cases in whatever manner they like, including providing the
parties an opportunity of oral hearings. The very fact that the concliator is free
rom the procedural tangles, by the virtue of this section, makes it more
cumbent upon the conciliator to adhere to the principles of natural justice to
ensure justice between the parties.
4. Conciliator shall make proposals : The conciliator may make
Poposals to the parties for settlement of disputes. Such proposals can be
ioe at any stage of the conciliation proceedings. Also, such proposals need
not be in writing and need not be accompanied by a statement of the reasons
disputes, conciliators can make
therefor. Thus, for speedy resolution of reasons therefor. Fresh or alternate
Droposals orally also
or in writing without stating
for consideration of
be made at any stage of proceedings proposal but they
proposals
the
may
parties. The parties may agree or disagree with
such
annot demand reasons for the same.
an independent and impartal
The conciliator only assiststhe parties insettlement of their disputes The
manner in their attempt to reach an amicable
Section 67 ofthe Act {Visa
Conciliator guidance as providedfor under Lid AIR 2009 SC 1366).
provides Continental Resources(Usa)
International Ltd. Vs
(Section 68)
Adminniorder
stratitovfacilitate
e assistance
the conduct of the concliation piocodings, he
parties,
parties, may arrange for adninistraive
Or theconciliator with theconsentof theperson
institution of veated with
assistance by a suitable
the conciliator has begnasivstraive
äsistarcG
Under this Section,any individual to render
hm
approach an institutionor
 THE ARBITRATION AND CONCILIATION ACT 100
212

However, conciliator can do so only with the consent of the parties.

the parties can themselves appoint an institution or any individual
conciliator in administrative functions. .Alternassiativsetly,
to the
Communication between conciliator and parties (Section
(1) The conciliator mayinvite the parties to meet him or may 69)
with them orally or in writing. He may meet
parties together or with each of them separately.
or Communicate
communicate with the
(2) Unless the parties have agreed upon the place where
the conciliator are to be held, such place shall be meetingsby with
conciliator, after consultation with the parties, having determined
the
circumstances of the conciliation proceedings. regard to the
The Act does not cast any obligation upon the Conciliator to adoot a
particular procedure. After receiving the written statement under section 65
the conciliator may invite the parties to meet him or may communicate with
them orally or in writing. He has to exercise his discretion in a manner in which
the objective of having a settlement should be arrived at. It is not mandatory
on part of the conciliator to meet the parties together, he may, at his discretion
meet the parties either separately or together. Also, the place of meeting shall
be decided by the conciliator, unless the parties have agreed upon such place.
However, if the place of meeting is decided by the conciliator the same shall
be done after consultation with the parties, having regard to the circumstances
of the conciliation proceedings. Therefore, the venue of the meeting shall be
such which is convenient not only for the conciliator but also for the parties and
the witnesses, if any.
Communication between the conciliator and the parties may take place
orally or in writing. So far as meetings between the conciliator and the parties
are concerned the conciliator may invite the parties together to have an
interaction between them or he may call each of them individually subject to
following the rules regardingdisclosure of information as set out under Sel
70 of the Act.

Disclosure of information [Section 70]

When the conciliator receivesfactual information concerning the dispute
from aparty, he shall disclose the substance of that information to the other
party in order that the other party may have the opportunity to present any
explanation which he considers appropriate.
Provided that when a party gives any information to the Conciliator subject
toaspecific condition that it be kept confidential, the conciliator shall not as
that information to the other party.
As mentioned earlier, under Section 65, a
party is
communications/ written statement to the conciliator and reguired
a copy oftothe
shall be sent to the other party. Thereafter, under Section 69
abo