Posted on: September 13, 2020 Posted by: admin Comments: 0

Author: Piyush Nair, Indore Institute of Law, Indore

Co-Author: Isha Singh, Indore Institute of Law, Indore


In a world where money is the foremost concern of every person, everyone is focusing on some sort of work in order to earn money. Due to the increase in the need for money, there is also a rapid increase in commercial activities. 

During recent times, owing to COVID-19, there is a rapid increase in the various forms of alternative dispute resolution methods; people prefer alternative ways rather than the lengthy process of trial and judgement. Among all the other ways of dispute resolution, this paper emphasises on the mediation process though people may argue that it is not binding but it is the best way to interact and solve the disputes confidentially, unlike arbitration as it is the process which with time is getting much costlier than the actual litigation process.

A recent survey as per NDTV shows that there are about 52000 cases pending in the supreme court of India, around 40 lakh cases are pending in the high court, around 2.7 crores cases in the trial courts and it is being said that with the increase in the literacy rate, there will also be an increase in the number cases. 

Now the million-dollar question is how will our judiciary system cope up with the cluster of cases?  The way is to appoint a number of judges and to mandate some cases to be solved outside the court that is through mediation. As in the year 2015, there were almost 1051 referred cases through mediation and among them 339 got settled.

As commercial transactions are increasingly taking place on the internet due to the increase in technology, everything is being done online, which further increases the possibility of disputes online. The scope of online mediation has increased specifically during the pandemic period of Corona virus. 

A recent study showed that more than 108 million Indian consumers did online shopping last year, with the increase in online shopping the disputes are also increasing, for this we can mandate online e-commercial mediation, also for such disputes initiatives were taken by the students of NLSIU created a setup of online consumer mediation centre (OCMC) which is supported by the Ministry of Commercial Affairs.


Mediation is legalized in India; in fact, the Supreme Court of India has constituted a special committee for proper implementation of mediation that is Mediation and Conciliation Project Committee {MCPC}. Also, mediation got recognition from the legislative body in the Industrial Dispute Act 1947.

The concept of mediation was made familiar or given official court recognition only in 1996 and by the amendment of the CPC in 1999 by putting section 89. Mediation is classified into two types:

  • Private mediation
  • Court preferred mediation

The reference of ADR mechanism is mandatory in cases which are found to possess elements of settlement and the commercial disputes do have an element of settlement, the mediation must be done under some legal services authority. Mediation first came to be legally recognized as a method of dispute resolution in the Industrial Dispute Act, 1947.

The Commercial Courts Act 2015 dated on May 3, 2018, has inserted section 12 A contemplating pre-institution mediation and settlement before the filing of any commercial dispute this part of the law was taken from the law procedure of Italy, wherein, litigants will not have direct access to courts as they first have to attend the initial mediation meeting as it will reduce the burden of the courts. 

In the Netherlands, the NMI mediation rules, all the mediators that are registered by the NML have to abide by those rules and guidelines. In this, the parties and the mediator follow strict confidentiality. If an agreement is reached then it is recorded under the settlement agreement, which is legally binding.

Online mediation is being in very much interest in countries like the US. Litigation is restricted by the concept of legal sovereignty, an injured party cannot go to a place where the cause of action took place or where the wrongdoer resides or carry a business thus online mediation is not only flexible and attractive but also helps avoid jurisdiction concerns.


This case will let you know how mediation is useful.

Problem – Birmingham based claimant who sued the defendant for $43500 in relation to supply of jewellery and failure by the defendant to send the item as they claimed that the jewellery got lost in the post, the claimant felt that defendant is being dishonest, he hasn’t sent the jewellery at the first place.

Solution – Mediation was being processed and at the end, the defendant agreed to continue the supply.

This solution of mediation helped save time as it took just 4 hours of time to solve through mediation as compared to 5 months and also it took less money as it could have taken in the court proceeding.


In India, judges have been really fast to recognize increased use of mediation as a helpful way to reduce the backlog of cases, as with American lawyers with early 1980s Indian lawyer conservative. Though Indian lawyers have not accepted mediation in our country as this process is depriving them to attain their income. 

With the rapid increase in technology, it can be said that ‘yes’ India is ready for solving e-commercial disputes through mediation rather than litigation. Although, in India, e-commercial mediation is less known, but not totally unknown. The process of solving through mediation online was recognised through the banking Ombudsman Scheme, 2006 issued by the Reserved Bank of India. Section 4 and 5 of the Information Technology Act provides legal recognition for electronic records and electronic signatures. So both the section has provided a solid base for mediation in India

The consumer protection bill 2015 provides for an option of filing complaints electronically. The bill also introduces mediation as an ADR mechanism. It provides for the formation of consumer mediation centreattached to the redressal commissions at district, state and national levels, and bringing in concern about the jurisdiction, a consumer can bring proceeding either in his own jurisdiction or the place where the supplier is domiciled. This rule cannot be altered by an agreement on jurisdiction between the parties. In India, the panchayat system has been widely accepted, which had 5 men who acted as the panchayat but in the recent times, these people have been adopted in the society legally as arbitrators or mediators.


The consumers nowadays are actively participating in online trade, yet they have less trust in e-commerce than approaching the market place because of continuously arising disputes on the e-commercial websites. Disputes regarding business to consumer contract or a business to business contract are the main e-commercial disputes which could be solved through mediation. So, an effective midway solution has been brought up in the online market, e-mediation i.e. resolving the disputes through internet only.

Online mediation can be used to resolve issues concerning delivery of products enforcement of warranties and guarantees on products, over billing etc. Mediation is practised on the community level, in combination with courts, in educational institutions, within corporations and other business settings, and in federal, state and local agencies.

Singaporeis the classic example amongst the smaller countries where ADR has been introduced along with other judicial reforms with immense success. The Singapore mediation centre has truly participated in the growth and development of ADR in Singapore. E-mediation projects are being undertaken in many forms like, the Cyber-tribunal Project at the University of Montreal School of Law, which further developed into e-resolution, by being a commercial service provider laying out e-mediation as well as Arbitration.

The main dispute which led to the rise in the online dispute resolution is domain name dispute, the popularity of using online mediation to resolve domain name dispute as on November 22, 2003, 5589 domain named disputes have been filed with WIPO arbitration and mediation centre and 5373 have been resolved. WIPO is promoting mediation in commercial disputes regarding intellectual property assets already.


eBay, Verisign, PayPal has partnered with Square-Trade. Now, you might be thinking why the researcher is specifying about Square-Trade.

Square-Trade is a young company which has been established to provide online mediation services to the consumers of the online trades. The company always promotes its fantastic ability to building trust between online buyers and sellers. Even the motto of the company is ‘Building Trust in the Transactions’. 

eBay is being described as ‘the world’s largest personal online trading community’, which has also partnered with Square-trade for online dispute resolution services mainly offered through e-mediation. 

The online Ombuds office begun in June 1996 as a mediation service aimed at disagreement that arises from a broad array of online activities. In June 1999, the Hewlett foundation provided an award to establish the centre for information technology and dispute resolution with the aim of developing a richer set of online dispute resolution tools.


It can be concluded that the road to a successful and safe environment for the online purchasing community is right in front of humans. Consequently, another way can be used by setting up a certification service provider, ODR seals can be a way to advertising the very fact that the company is ready to provide online mediation facility. In the US there are seals of online mediators, Square Trade and BBB online. Various mediation centres can also be put up outside the district and high courts.

The main advantage of online dispute resolution is that the question of jurisdiction does not even arise. In Mediation we see both the perspective as there are always two sides of the coin focusing on the single side we often tend to ignore the other side which is not in the case of mediation, both parties are listened carefully.

As in courts, it will reduce the burden of the court which will surely reduce the number of pending cases in the country and if most of the e-commercial cases get solved through mediation then there will be a great relief to the Indian courts. If courts and mediation work hand in hand then there will be easy settlements.

The E-commercial dispute can be cleared through mediation as it involves buyers and sellers’ relation and if there is a good mediator then it would help to make the relationship stronger. Specially, during the time of COVID-19, it will be way handier than earlier. 



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[1] Supra note 3, 706-708

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