A law that commenced twice, and only half of it so far
Parliament passed the Mediation Bill in the Rajya Sabha on 1 August 2023 and the Lok Sabha on 7 August 2023. President Droupadi Murmu gave her assent on 14 September 2023, and the Act was gazetted the next day as Act No. 32 of 2023. Section 1(3) of the Act gives the Central Government the power to bring different provisions into force on different dates, and it used that power narrowly. Notification S.O. 4384(E), dated 9 October 2023, commenced exactly seven groups of sections: Section 1 (short title), Section 3 (definitions), Section 26 (a savings clause protecting Lok Adalat and Permanent Lok Adalat proceedings), Sections 31 to 38 (constitution and composition of the Mediation Council of India), Sections 45 to 47 (the Mediation Fund), Sections 50 to 54 (protection of action taken in good faith, rule-making powers and related miscellaneous provisions), and Sections 56 and 57 (a clause stating the Act does not apply to pending proceedings, and a power to remove difficulties).
Read that list again and notice what is missing. Section 4, which defines a mediation agreement. Section 5, pre-litigation mediation. Section 6, the list of disputes not fit for mediation. Section 7, the court's power to refer parties to mediation. Sections 8 to 17, covering the appointment, conduct and role of mediators. Section 18, the 120-day (extendable to 180-day) timeline. Section 19, which sets out what a mediated settlement agreement must contain. Section 27, which makes that agreement enforceable as a civil court decree. Section 28, which sets the narrow grounds on which it can be challenged. None of these were part of the October 2023 notification, and no further commencement notification appears on the public record. What actually switched on in the Act's first month was scaffolding - definitions, the Council's legal shell, a fund, savings clauses - not the operative machinery that gives the Mediation Act its teeth.
This distinction matters more than it might sound. It does not mean mediation stopped happening in India while the rest of the Act sat dormant. Court-referred mediation under Section 89 of the Code of Civil Procedure, Lok Adalats under the Legal Services Authorities Act, 1987, and above all pre-institution mediation under Section 12A of the Commercial Courts Act, 2015 - an older, separate statute - carried on exactly as before, because none of that depends on the new Act. What has not happened, on the public record, is the Mediation Act, 2023 itself becoming the operative law governing how a mediation agreement is formed, how pre-litigation mediation is triggered, or how a mediated settlement becomes enforceable. A great deal of commentary published around the Act's passage - and its first anniversary - glossed over this. Bill text reads the same whether or not it has commenced, and the distinction is easy to miss unless the commencement notification itself is checked section by section.
The actual site of activity: Section 12A of the Commercial Courts Act
Because the new Act's core provisions were not driving practice, the real contest over mandatory mediation in India's commercial courts played out where it always had - around Section 12A of the Commercial Courts Act, 2015, inserted by a 2018 amendment. That section bars a commercial suit of the specified value from being instituted unless the plaintiff has first exhausted pre-institution mediation, with one exception: suits that contemplate urgent interim relief.
That exception did most of the heavy lifting in this period, and the Supreme Court spent much of 2025 narrowing what it means. In Dhanbad Fuels Private Limited v. Union of India, decided in May 2025, the Court gave guidance on how far back Section 12A's mandatory character reaches, making clear that suits filed before the requirement was judicially settled as mandatory should not be penalised retroactively for skipping mediation they had no clear duty to attempt at the time. In October 2025, in Novenco Building and Industry A/S v. Xero Energy Engineering Solutions, the Court went further and set out a structured test for when the urgent-interim-relief exception applies, particularly in intellectual property disputes involving continuing infringement. The Court held that mediation remains mandatory unless the plaint itself discloses a genuine and immediate need for interim protection; that the urgency must be evident from the plaint and its annexures rather than argued after the fact; that courts should look for real signs of irreparable harm rather than formal prayers for relief; that pro forma injunction requests designed only to bypass mediation will not qualify; and that urgency should be assessed from the plaintiff's perspective without pre-judging the merits. In March 2026, the Madras High Court applied the same logic, holding that pre-institution mediation is not mandatory where a suit genuinely contemplates urgent interim relief, reinforcing the Supreme Court's framework at the high court level.
For a disputes lawyer, this is the practical law of mandatory mediation in India today. Before drafting a commercial plaint, the urgency argument - if it exists - needs to be built into the pleading itself, supported by facts and annexures that show real and immediate harm, not asserted as an afterthought once a defendant raises a Section 12A objection. Treating an interim-relief prayer as a routine device to sidestep mediation is now a demonstrably weaker strategy than it was even two years ago.
The enforcement promise, once it is switched on
None of this means the Mediation Act, 2023's enforcement architecture is unimportant - only that its significance is prospective rather than settled. Once Sections 19, 27 and 28 are brought into force, they will change how a mediated settlement is treated in a way the pre-existing law never quite managed. Section 19 requires a mediated settlement agreement to be in writing, signed by the parties, and authenticated by the mediator. Section 27 then makes that signed and authenticated agreement enforceable in the same manner as a judgment or decree of a court, under the Code of Civil Procedure, 1908 - meaning a party can move straight to execution under Order XXI of the CPC rather than filing a fresh suit to convert a private settlement into a consent decree, which was often the only route available before.
The corresponding protection for finality is deliberately narrow. Under Section 28, a mediated settlement agreement can be challenged only on grounds of fraud, corruption, impersonation, or because the underlying dispute fell within the categories the First Schedule says are not fit for mediation in the first place - disputes involving minors, persons of unsound mind, or deities; prosecution of criminal offences; direct and indirect tax disputes; complaints before professional regulators; disputes affecting the rights of third parties who were not part of the mediation, except where a child's interests are involved in a matrimonial dispute; matters before SEBI, TRAI, TDSAT or under the Competition Act, 2002; and disputes over compensation under land acquisition law. A challenge must be filed within 90 days of receiving the agreement, extendable by a further 90 days on sufficient cause. Notably absent from the list of grounds: dissatisfaction with the outcome, an argument that the settlement is unjust or inequitable, or duress and coercion discovered outside the limitation window. Once this regime takes effect, disputes lawyers advising a client on whether to settle through mediation will need to treat the resulting agreement with something close to the finality of an arbitral award - the room to reopen it later is genuinely small.
The regulator still finding its feet
The Mediation Council of India, provided for under Section 31, is the body meant to register mediators, recognise Mediation Service Providers and Mediation Institutes, set training and accreditation standards, frame a code of conduct, and build the rules that will govern online and community mediation under the Act. The sections constituting the Council - Sections 31 to 38 - were among those brought into force in October 2023, which gives the Council legal existence on paper. Standing it up as a functioning body has taken considerably longer. In March 2025, the government told Parliament that steps were under way to establish the Council, without giving a firm date. The Department of Legal Affairs maintains a standing page, repeatedly updated, specifically addressing parliamentary questions on the status of the Mediation Council of India - itself a sign that full constitution of the body remains an open question well into the Act's third year. Separate rules covering travel and allowances for the Council's part-time chairperson and members were notified in 2024, but that is administrative housekeeping around a body whose substantive functions - accreditation, recognition of service providers, a mediator code of conduct, and the technical safeguards for online mediation - have not yet been exercised at scale.
For disputes lawyers, the absence of a fully functioning Council means there is still no completed national framework for who counts as an accredited mediator, which institutions are recognised Mediation Service Providers, or what standards govern a secure online mediation session under the Act. Institutions such as the Mumbai Centre for International Arbitration, IAMC Hyderabad and India's other arbitration hubs have continued to build out their own mediation panels in this gap, but a genuinely national, Council-backed accreditation system remains a work in progress.
Where mediation and arbitration intersect
The Mediation Act, 2023 also touches arbitration practice more directly than its title suggests. Section 61, read with the Sixth Schedule, provides for amendments that fold conciliation into the Act's definition of mediation and would, once effective, displace Part III of the Arbitration and Conciliation Act, 1996 - the part that has governed conciliation as a distinct process since 1996. Section 61 was not among the provisions notified in October 2023 either, so this displacement has not yet taken legal effect. Contracts that currently include a conciliation clause are still operating under Part III of the 1996 Act, not under the new statute, and disputes lawyers reviewing dispute resolution clauses should not assume otherwise until a further notification says so.
The practical overlap between mediation and arbitration is, in the meantime, playing out at the institutional level rather than the statutory one. Arbitral institutions are increasingly building mediation panels alongside their arbitrator rosters, positioning mediation as a companion step in multi-tier dispute resolution clauses - mediate first, arbitrate if that fails - that are now common in EPC contracts, joint venture agreements and shareholder arrangements. For attorneys drafting these clauses, the safer course for now is to rely on the mediation rules of the chosen institution to set timelines and mediator-appointment mechanics, rather than assuming the Mediation Act's own procedural provisions will govern a clause invoked today.
The cross-border gap
India signed the United Nations Convention on International Settlement Agreements Resulting from Mediation - universally known as the Singapore Convention on Mediation - on 7 August 2019, the day it opened for signature alongside more than 45 other states. As of today, India has not ratified it. The treaty's official status table lists India only as a signatory, with no ratification date recorded, placing it alongside the United States, China and the United Kingdom among major economies that signed early but have not converted that signature into binding accession. A number of smaller economies have moved past that stage in just the last year or two - Bahrain, Costa Rica, Paraguay and Brazil among them - while India's position has not changed since 2019.
The practical consequence for disputes lawyers is real. Once Section 27 is in force, a mediated settlement agreement signed in India will be enforceable inside India as a court decree. It will have no automatic route to enforcement in the many jurisdictions that have ratified the Singapore Convention, the way an arbitral award benefits from the New York Convention's near-universal reach. For cross-border commercial mediation - precisely the category of business India's arbitration hubs, GIFT City in particular, have been trying to attract - that leaves a gap that neither the international convention nor the domestic Act currently closes.
What the uptake numbers actually show
The case for mediation as an effective mechanism is not in doubt where it has institutional infrastructure and a captive population that needs it. Figures released by the National Legal Services Authority for 2021-22 recorded 464 ADR centres nationally, of which 397 were operational, 570 dedicated mediation centres, roughly 16,565 trained mediators, and close to 53,000 disputes resolved through mediation that year. The Delhi High Court's Samadhan mediation centre, working through referrals from the Tis Hazari family courts between 2015 and 2021, disposed of 95,102 of the 109,869 cases referred to it - a disposal rate above 86 per cent, almost entirely in family-law matters.
Commercial disputes tell a much less encouraging story. Telangana's 2025 Mediation for the Nation campaign identified 42,129 cases as candidates for settlement, referred 12,891 of them to mediation, and settled only 1,416 - a rate of roughly 11 per cent. That gap between family-court mediation and commercial mediation is not a coincidence. Where mediation has built-in institutional weight and parties who are already motivated to resolve a dispute - as in family courts and Lok Adalat backlogs - it performs strongly. Where commercial parties view it as a procedural step to clear before litigation resumes, which is how Section 12A pre-institution mediation is frequently treated in practice, it performs poorly. Closing that specific gap, for exactly the population of commercial and disputes lawyers this publication serves, is the problem the Mediation Act, 2023 was written to solve. On the evidence so far, the law's own operative machinery has not yet had the chance to try.
What this means for disputes lawyers now
A few practical implications follow directly from where the law actually stands. First, the live battleground for mandatory mediation in commercial and IP disputes is Section 12A of the Commercial Courts Act and the Supreme Court's 2025 rulings on urgency, not the Mediation Act's own pre-litigation mediation provisions, which are not yet in force. Any urgency argument needs to be built into the plaint itself, with supporting facts and annexures, not raised defensively once a Section 12A objection is filed.
Second, do not advise a client that a mediated settlement automatically carries decree-holder enforceability under the new Act until the commencement notification for Sections 19, 27 and 28 is confirmed. For now, enforceable settlements in commercial matters still need to be routed through consent decrees, the existing Section 12A machinery, or arbitral consent awards where an arbitration is already on foot.
Third, when drafting multi-tier dispute resolution clauses that combine mediation and arbitration, rely on the chosen institution's own mediation rules for timelines and mediator appointment rather than assuming the Mediation Act's procedural provisions will apply to a clause invoked today. Fourth, keep a close watch on the Mediation Council of India's actual constitution and rule-making accreditation, recognised Mediation Service Providers, and the online-mediation safeguards all flow from it, and its emergence as a working body will be the real signal that the Act's substantive chapters are about to follow. Attorneys structuring mediation clauses, advising on Section 12A compliance, or looking for mediators and ADR specialists with relevant Indian commercial experience can search Exlitem's directory of experts to find professionals who have worked on comparable matters.
Takeaway
• The Mediation Act, 2023 has been partially in force since October 2023 - but only its administrative scaffolding (definitions, the Mediation Council's legal shell, the Mediation Fund, savings clauses). The operative chapters on mediation agreements, pre-litigation mediation, and enforceable settlement agreements were not part of that notification, and no further commencement notification is publicly on record.
• The real activity for disputes lawyers over the past two years has come from Section 12A of the Commercial Courts Act, 2015, and the Supreme Court's 2025 rulings - Dhanbad Fuels and Novenco - on when urgent interim relief exempts a commercial suit from pre-institution mediation.
• Once switched on, Sections 19, 27 and 28 will make a signed, mediator-authenticated settlement agreement enforceable as a civil court decree, challengeable only on narrow grounds - fraud, corruption, impersonation, or unsuitability under the First Schedule - and not on the merits.
• India has signed but not ratified the Singapore Convention on Mediation, leaving cross-border enforcement of mediated settlements without the international backbone that the New York Convention gives arbitral awards.
• Court-annexed mediation performs strongly in family and legal-aid settings, with disposal rates above 86 per cent at some centres, and poorly in commercial matters, where settlement rates in recent state-run drives have run closer to 11 per cent - the exact gap the Mediation Act was designed to close, and has not yet had the chance to.
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