Conciliation Proceedings and Enforceability: Bridging Dispute Resolution and Legal

Finality
Under the Arbitration and Conciliation Act, 1996

Kashyap — 4th Year, BBA LLB (Hons.), GITAM School of Law

Icons: ■■ Justice • ■ Settlement • ■ Agreement • ■ Confidentiality

 Introduction to Conciliation (Part III, Ss. 62–76)
What is Conciliation? ■

• Voluntary, flexible, and confidential ADR process under Part III of the Act.

• A neutral conciliator assists parties to reach an amicable settlement.

• Outcome is a written settlement agreement signed by parties.

Conciliation vs Arbitration (Quick Contrast)

• Arbitration: formal, tribunal-like; ends with binding arbitral award.

• Conciliation: informal & cooperative; ends with settlement agreement.

• Conciliator not bound by CPC/Evidence Act (Sec. 66) unlike typical court procedures.

Where defined? The Act does not provide a standalone definition of “conciliation”; it is provided for in Part III (Sections 62–76 here; further provisions continue
up to Section 81).
 Section 62 – Commencement of Conciliation
Trigger & Timeline ■

• Initiation by written invitation identifying the subject of dispute.

• Proceedings commence on written acceptance by the other party.

• If invitation is rejected  no conciliation.
• No reply within 30 days (or invited period)  initiating party may treat as rejection (must inform in writing).
 Sections 63 & 64 – Number and Appointment of Conciliators
Section 63 – Number ■

• Default: one conciliator.

• Parties may agree to two or three conciliators.

• Where more than one: act jointly, as a general rule.

Section 64 – Appointment ■■■■

• One conciliator: name agreed by the parties.

• Two conciliators: each party appoints one.

• Three conciliators: each party appoints one; parties agree on the third (presiding).
• Parties may seek assistance of an institution/person to recommend or make appointments.
• Appointment criteria: independent & impartial; for sole/third, consider different nationality from parties.
 Section 65 – Submission of Statements
Written Submissions ■

• On appointment, conciliator may request brief written statements: general nature of dispute & points at issue (copy to other party).

• Conciliator may request further written statements with facts, grounds, documents, and evidence (copy to other party).
• At any stage, conciliator may seek additional information as appropriate.
• Explanation: ‘Conciliator’ covers sole/two/three, as the case may be.
 Sections 66 & 67 – Procedure and Role
Section 66 – Not Bound by CPC or Evidence Act ■

• Conciliator is not bound by the Code of Civil Procedure, 1908 or the Indian Evidence Act, 1872.

• Allows flexible, needs-based procedure to promote settlement.

Section 67 – Role of Conciliator ■

• Assist parties independently and impartially to reach an amicable settlement.

• Guided by objectivity, fairness, justice; consider rights/obligations, trade usages, surrounding circumstances & past dealings.
• May conduct proceedings as appropriate—hear oral statements if requested; aim for speed.
• May make settlement proposals at any stage; proposals need not be in writing or accompanied by reasons.
 Sections 68, 69 & 70 – Assistance, Communication, Disclosure
Section 68 – Administrative Assistance ■■

• Parties or conciliator (with consent) may arrange administrative assistance by an appropriate institution/person.

• Facilitates logistics, scheduling, documentation, and venue.

Section 69 – Communication with Parties ■

• Conciliator may invite meetings or communicate orally/in writing.

• May meet both parties together or separately (caucus).

• If place not agreed, conciliator determines it after consulting parties and considering circumstances.

Section 70 – Disclosure of Information ■

• Conciliator must disclose the substance of factual information received from one party to the other.

• Ensures opportunity to explain/respond and maintains procedural fairness.

• Exception: information given subject to confidentiality must not be disclosed.
 Sections 71 & 72 – Cooperation and Party Suggestions
Section 71 – Cooperation ■

• Parties shall act in good faith and cooperate with the conciliator.

• Specifically: endeavour to submit requested writings, provide evidence, and attend meetings as requested.

Section 72 – Suggestions by Parties ■

• Parties may, on their own or at the conciliator’s invitation, submit suggestions for settlement.

• Encourages party ownership and creative, interest-based solutions.

 Section 73 – Settlement Agreement (Detailed Mechanics)
Pathway to Settlement ■

• When conciliator sees acceptable elements, formulates terms of a possible settlement and submits to parties for observations.

• After party feedback, conciliator may reformulate terms in light of observations.

• If parties reach agreement: draw up and sign a written settlement agreement.
• On signing: settlement agreement becomes final and binding on parties and persons claiming under them.
• Conciliator authenticates the settlement agreement and furnishes a copy to each party.
 Section 74 – Status and Effect of Settlement Agreement
Legal Finality ■■

• Settlement agreement has the same status and effect as an arbitral award on agreed terms under Section 30.

• Practical takeaway: enforceable in the same manner as an arbitral award (i.e., carries decree-like finality under the scheme of the Act).
• Gives conciliation outcomes teeth comparable to arbitration, while retaining flexibility of process.
 Section 75 – Confidentiality
Scope of Confidentiality ■

• All matters relating to conciliation proceedings are to be kept confidential by the conciliator and the parties.

• Confidentiality extends to the settlement agreement as well.

• Exception: disclosure permitted where necessary for implementation or enforcement of the settlement.
 Section 76 – Termination of Conciliation Proceedings
Four Termination Modes ■

• By signing of the settlement agreement (termination date = date of agreement).

• By written declaration of the conciliator (after consultation) that further efforts are no longer justified.
• By written declaration of the parties to the conciliator that proceedings are terminated.
• By written declaration of a party to the other party and the conciliator (if appointed) that proceedings are terminated.
 Conciliation at a Glance – Process Map (Ss. 62–76)
High-Level Flow ■■
• Start: Invitation & Acceptance (Sec. 62)  Constitution/Appointment (Secs. 63–64).
• Submissions & Information (Sec. 65)  Flexible Procedure & Role (Secs. 66–67).
• Logistics & Communications (Secs. 68–70)  Party Cooperation & Suggestions (Secs. 71–72).

• Settlement Drafting, Authentication & Binding Effect (Sec. 73).

• Enforceability = Award on Agreed Terms (Sec. 74).
• Confidentiality (Sec. 75) and Termination modes (Sec. 76).
 Practical Notes for Parties & Conciliators
Party Playbook ■

• Draft the invitation with clear subject of dispute; propose a response window.

• Nominate conciliators emphasizing independence, impartiality, and nationality diversity for sole/third (Sec. 64).
• Prepare concise statements with annexures; exchange copies promptly (Sec. 65).
• Use caucuses judiciously; respect disclosure rules & confidentiality flags (Secs. 69–70).
• Submit constructive settlement options early (Sec. 72).

Conciliator Toolkit ■

• Set a flexible but structured timetable; promote speed (Sec. 67).

• Record confidential vs shareable information explicitly (Sec. 70 proviso).

• Iterate draft terms; capture party feedback precisely (Sec. 73).
• Authenticate the final settlement and furnish copies (Sec. 73(4)).
 Conclusion – Bridging Dispute Resolution and Legal Finality
Key Takeaways ■

• Conciliation blends cooperation with enforceability.

• Section 74 elevates the settlement to award-like status, ensuring legal finality.

• The Part III framework (62–76) enables speed, flexibility, confidentiality, and party autonomy.

“In law, conciliation is not victory of one, but peace for both.”