Conciliation: The Institute of Chartered Accountants of India

CHAPTER 4 CONCILIATION LEARNING OUTCOMES At the end of this chapter, you will be able to understand:  Definition, Meaning and Characteristics of the process of conciliation  Appointment and Role of Con...

CHAPTER 4 CONCILIATION LEARNING OUTCOMES At the end of this chapter, you will be able to understand:  Definition, Meaning and Characteristics of the process of conciliation  Appointment and Role of Conciliator  Commencement of process of Conciliation Proceedings  Submission of statements of Conciliator  Communication between Conciliator and Parties  Termination of Conciliation Proceedings ©The Institute of Chartered Accountants of India  4.2 THE ARBITRATION AND CONCILIATION ACT, 1996 CHAPTER OVERVIEW Conciliation Definition and Characteristics Commencement Appointment, of conciliation Submission of number and Disclosure of Settlement proceedings statements to role of Information Agreement and its conciliator conciliators termination 1. CONCILIATION Arbitration is one of the many ADR methods utilized to resolve dispute outside the court system. However, Arbitration remains adversarial in nature. It mimics the court system, and, therefore, like a court adjudicates a matter. This, however, means that the parties remain as adversaries, with one party having won and the other losing the contest. This win-loss creates a feeling of bitterness, and often tends to destroy relations. In order to avoid these consequences of arbitration, Conciliation method of ADR can be adopted. Conciliation involves a neutral third party who is known as the conciliator and who facilitates communication between the conflicting parties. The main object of conciliation is to assist the parties to find common ground, reach a mutually acceptable solution and rebuild relationships. Conciliation Definition & Characteristics of Enforcement of Settlement Conciliation Role of Conciliators Agreement ©The Institute of Chartered Accountants of India  CONCILIATION 4.3. Definition There is no single definition of Conciliation. It can be understood as a process of getting the parties to come to an agreement about a common problem/dispute through confidential discussion and dialogue. In its operation, it is very similar to mediation and like mediation, it is voluntary, flexible and completely at parties’ initiative. Characteristics Voluntary Assisted procedure Characteristics Non-Adversarial Finality of settlement Confidentiality (a) Voluntary – The process of conciliation is voluntary which implies that all parties have to agree to have their disputes conciliated. Unless all the parties involved in the dispute agree, the matter cannot be conciliated. No party can be forced to conciliate matter or attend conciliation proceedings. If a party is forced, then the outcome of such conciliation would not be binding on that party. Thus, party autonomy and consent are important aspects of conciliation. This was also held by the Supreme Court of India in the case of Afcons Infrastructure Ltd. Vs. Cherian Varkey Construction Co. (P) Ltd., JT 2010 (7) SC 616. Example: S Ltd. purchased goods from M Ltd. Later on, a dispute arose on the price of goods supplied to S Ltd. M Ltd. was interested in resolving the dispute through conciliation process but S Ltd. refused. Held, conciliation process cannot be started as both the parties to dispute are not agreed for it. (b) Non-Adversarial – Unlike arbitration or court based adjudication, the parties do not compete against each other to prove themselves as correct and others as wrong. Parties do not behave as adversaries, who can only win by defeating the other party. Instead of focusing on win-lose, the attempt is to find a solution to the problem that best suits all the parties involved, in such a manner that no party is at worse off position. ©The Institute of Chartered Accountants of India  4.4 THE ARBITRATION AND CONCILIATION ACT, 1996 (c) Assisted procedure – The conciliation proceedings can be crafted in a manner which most suits the parties’ convenience. In order to assist the parties at all times in arriving at a solution, the conciliator(s) are present. They, along with the parties, craft a procedure for sharing information among the parties so as to reach an amicable settlement. (d) Finality of settlement – The outcome i.e. settlement as an end result of the conciliation process is final and binding between the parties. (e) Confidentiality – All aspects of the conciliation process are confidential. In other words, the conciliator(s) and the parties cannot disclose to persons who are not party to conciliation, any matter relating to the conciliation proceedings. Thus, confidentiality primarily operates to cover the process and its participants. It prevents leak of information. However, during the process, information received by the conciliator from one party must be disclosed to the other party, unless the party giving the information has specifically requested that it be kept confidential. Even the agreement arrived at by the parties is covered under the broad spectrum of confidentiality. This is important because it assures the parties that any information, they share would remain private and would not be used against them in an adversarial manner. Example: During the conciliation proceedings between A and B, conciliator obtained some information from B but B requested the conciliator not to disclose this information to A and to keep it confidential. Now, it is the duty of conciliator to maintain the confidentiality and not to share the information with A or any other person. 2. CONCILIATION IN INDIA In India, conciliation is governed by Part III (Section 61 to 81) of the Arbitration and Conciliation Act, 1996 and by Section 89 of the Code of Civil Procedure 1908. Any dispute arising out of a legal relationship, whether contractual or not, can be conciliated. Thus only those disputes which are not prohibited by law from being conciliated can be submitted to conciliation. Application and Scope Section 61 — (1) Save as otherwise provided by any law for the time being in force and unless the parties have otherwise agreed, this Part shall 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 law for the time being in force certain disputes may not be submitted to conciliation. ©The Institute of Chartered Accountants of India  CONCILIATION 4.5. Section 61 provides for application and scope of conciliation machinery provided in the part III of the Arbitration and Conciliation Act, 1996. According to sub – section (1), provisions of Part III will not be applicable to the disputes if any other law restricts the use of this part/act or if the parties have agreed not to follow the provisions of this part/Act in their dispute redressal. Further, the provisions of Part III are applicable to all disputes whether contractual or non – contractual. Parties are free whether to follow or not to follow the provisions of this Part. Sub – section (2) provides that if the existing law declares that certain disputes cannot be submitted for conciliation, Part III of Arbitration and Conciliation Act, 1996 shall not be applied. 3. COMMENCEMENT OF PROCESS OF CONCILIATION PROCEEDING Commencement of conciliation proceedings Section 62 — (1) The party initiating conciliation shall send to the other party a written invitation to conciliate under this Part, briefly identifying the subject of the dispute. (2) Conciliation proceedings, shall commence when the other party accepts in writing the invitation to conciliate. (3) If the other party rejects the invitation, there will be no conciliation proceedings. (4) If the party initiating conciliation does not receive a reply within thirty days from the date on which he sends the invitation, or within such other period of time as specified in the invitation, he may elect to treat this as a rejection of the invitation to conciliate and if he so elects, he shall inform in writing the other party accordingly. Section 62(1) deals with the initiation of conciliation. Any party to dispute wishing to initiate conciliation proceedings has to fulfill following conditions: (a). The party initiating conciliation must send a written invitation to other party. (b). This written invitation should contain the subject of dispute. (c). The party should also state that the invitation is under Part III. According to section 62(2), the other party must give his acceptance for conciliation in writing. The verbal or oral acceptance has not been considered in section 62(2). ©The Institute of Chartered Accountants of India  4.6 THE ARBITRATION AND CONCILIATION ACT, 1996 Section 62(3) empowers the other party to reject the invitation to conciliation. In case the other party rejects the invitation, the conciliation proceedings cannot be initiated. The party initiating conciliation may mention the time limit for acceptance in written invitation to other party. Section 62(4) provides that if the party does not receive any reply within 30 days of sending the invitation or such other period as mentioned in the invitation, he has an option to treat this as rejection of the invitation to conciliate and if he treats it as rejection of invitation, he must communicate this by sending a written intimation. Example: In a dispute between A & B, A sent a written invitation to B containing the subject of dispute and request for reply within 20 days. B did not reply within the said period. Here, A is free to treat this as rejection of the invitation to conciliate. A opts for rejection and so he should send a written intimation. 4. APPOINTMENT, NUMBER AND ROLE OF CONCILIATOR Number of conciliators Section 63 — (1) There shall be one conciliator unless the parties agree that there shall be two or three conciliators. (2) Where there is more than one conciliator, they ought, as a general rule, to act jointly. Section 63 deals with the number of conciliators that can be appointed for conciliation proceedings. But, first of all, we should understand the term “Conciliator”. The Cambridge Dictionary provides that a “Conciliator” is a person who helps two sides in a disagreement, like employers and employees, to meet and talk about their different ideas in the hope of ending the disagreement. According to Halsbury’s laws of England, a “Conciliator” is a neutral third party appointed to facilitate the resolution of a dispute between conflicting parties. It must be noted that whereas decision of the arbitrator is binding on the parties, findings of the conciliator is recommendatory in nature. On the analysis of section 63, appointment of sole conciliator is preferred but parties to dispute are free to appoint two or three conciliators by their mutual agreement. But question arises, why a sole conciliator is preferred. There may be following reasons for it: 1. A sole conciliator can help in minimising the complexity of the proceedings compared to multiple conciliators, making it easier for the parties to navigate the resolution process. ©The Institute of Chartered Accountants of India  CONCILIATION 4.7. 2. Appointment of a sole conciliator often leads to a quicker resolution. 3. Appointment of sole conciliator will be comparatively less expensive. 4. A sole conciliator ensures a consistent and unified approach to the resolution process. 5. With a sole conciliator, communication channels are clearer and more direct. 6. With fewer individuals involved, there may be a heightened level of confidentiality in the conciliation process. 7. The involvement of a sole conciliator may empower the parties to take more active roles in the resolution process. 8. A sole conciliator can be selected based on specific expertise related to the nature of the dispute, ensuring a more targeted and relevant approach to resolution. 9. The process of drafting a settlement agreement may be more efficient with a sole conciliator, as there is a single point of coordination for finalizing the terms. Further, section 63(2) provides that if there is more than one conciliator, all the conciliators have to conciliate jointly and have to settle the dispute. Appointment of conciliators Section 64 — (1) Subject to sub-section (2),— (a) in conciliation proceedings with one conciliator, the parties may agree on the name of a sole conciliator; (b) in conciliation proceedings with two conciliators, each party may appoint one conciliator; (c) in conciliation proceedings with 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. (2) Parties may enlist the assistance of a suitable institution or person in connection with the appointment of conciliators, and in particular,— (a) a party 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 conciliators be made directly by such an institution or person: ©The Institute of Chartered Accountants of India  4.8 THE ARBITRATION AND CONCILIATION ACT, 1996 Provided that in recommending or appointing individuals to act as conciliator, the institution or person shall have regard to such considerations as are likely to secure the appointment of an independent and impartial conciliator and, with respect to a sole or third conciliator, shall take into account the advisability of appointing a conciliator of a nationality other than the nationalities of the parties." Section 64 deals with the procedure for appointment of auditor. According to it, there may be sole conciliator or two or three conciliators. Section 64(1)(a) empowers the parties to decide the name of sole conciliator in case, on agreement, one conciliator is appointed to conduct conciliation proceedings. Clause (b) of above sub – section provides that where two conciliators are appointed by parties for conducting conciliation proceedings, each party is empowered to appoint one conciliator. According to clause (c) of sub – section (1) of Section 64, if three conciliators are appointed for conciliation proceedings, each party is authorised to appoint one conciliator and the third conciliator will be appointed by mutual agreement between the parties and such conciliator will act as presiding conciliator. It is to be noted that presiding conciliator is not authorised to take binding decision where there is difference in the opinion between the conciliators. However, the parties may, by agreement, authorise the presiding conciliator. Sub – section (2) of Section 64 provides that parties are free to seek the assistance of a suitable institution (like certain chamber of commerce, etc.) or person in connection with the appointment of conciliators. This can be done through the following means: ♦ A party may request such an institution or person to recommend the names of suitable individuals to act as a conciliator. ♦ The parties may agree that the appointment of one or more conciliators be made directly by such an institution or person. Further, proviso to Section 64(2) provides the guidelines to the institution or the person to recommend or appoint the conciliators. Accordingly, such institution or person should give due regard to the principle of independence and impartiality while recommending or appointing the conciliator. In addition, while appointing a sole or third conciliator, they should consider the desirability of appointing a conciliator of a nationality different from that of the parties, so as to ensure that appointment is more favorable to any one party. ©The Institute of Chartered Accountants of India  CONCILIATION 4.9. Submission of statements to conciliator Section 65 — (1) The conciliator, upon his appointment, may request each party to submit to him a brief written statement describing the general nature of the dispute and the points at issue. Each party shall send a copy of such statement to the other party. (2) The conciliator may request each party to submit to him a further written statement of his position and the facts and grounds in support thereof, supplemented by any documents and other evidence that such party deems appropriate. The party shall send a copy of such statement, documents and other evidence to the other party. (3) At any stage of the conciliation proceedings, the conciliator may request a party to submit to him such additional information as he deems appropriate. Explanation.—In this section and all the following sections of this Part, the term "conciliator" applies to a sole conciliator, two or three conciliators, as the case may be. Sub – section (1) of Section 65 provides that when conciliator is appointed, he should request each party to submit a written statement summarising the nature of dispute and specified points of issue. Each party will also send a copy of such submission of statement to other party. The purpose of such submission of written statement is to provide information about general nature of dispute to conciliator. Sub – section (2) provides that the conciliator may demand from each party, a further written statement to clarify his position and also to support his grounds of the facts. These may be supplemented by other documents and evidences, if the party thinks appropriate. Further, this sub – section makes it obligatory on the parties to submit the copy of these documents and evidences to the other party. Sub – section (3) empowers the conciliator to request the party/ parties to submit additional information, which in his opinion, is necessary for the purpose of accelerating the conciliation proceedings. Conciliator not bound by certain enactments Section 66 — The conciliator is not bound by the Code of Civil Procedure, 1908 (5 of 1908) or the Indian Evidence Act, 1872 (1 of 1872). Section 66 provides that conciliator is not bound by the provisions of Code of Civil Procedure, 1908 or the Indian Evidence Act, 1872. It is to be noted that conciliator should be bound to follow the principles of natural justice. He should be impartial, unbiased and transparent while conducting ©The Institute of Chartered Accountants of India  4.10 THE ARBITRATION AND CONCILIATION ACT, 1996 conciliation proceedings. In Haresh Dayaram Thakur Vs. State of Maharashtra and Ors., Honorable Supreme Court held a conciliator is a person who is to assist the parties to settle the disputes between them amicably. For this purpose, the conciliator is vested with wide powers to decide the procedure to be followed by him untrammeled by the procedural law like the Code of Civil Procedure or the Indian Evidence Act, 1872. Role of conciliator Section 67 — (1) The conciliator shall assist the parties in an independent and impartial manner in their attempt to reach an amicable settlement of their dispute. (2) The conciliator shall be guided by principles of objectivity, fairness and justice, giving consideration to, among other things, the rights and obligations of the parties, the usages of the trade concerned and the circumstances surrounding the dispute, including any previous business practices between the parties. (3) The conciliator may conduct the conciliation proceedings in such a manner as he considers appropriate, taking into account the circumstances of the case, the wishes the parties may express, including any request by a party that the conciliator hear oral statements, and the need for a speedy settlement of the dispute. (4) The conciliator may, at any stage of the conciliation proceedings, make proposals for a settlement of the dispute. Such proposals need not be in writing and need not be accompanied by a statement of the reasons therefor. Section 67(1) deals with the role of conciliator. According to it, a conciliator has to render assistance in an independent and impartial manner to the parties who are trying to settle the dispute in a friendly process of conciliation. Section 67(2) provides that the conciliator should follow objectivity, fairness, and justice principles throughout the conciliation proceedings. In other words, the conciliator should treat both the parties equally and not favour one party over the other. The conciliator, while conducting conciliation proceedings, should consider various factors including: ♦ the rights and obligations of the parties, ♦ the usages of the trade concerned, ♦ the circumstances surrounding the dispute, ♦ any previous business practices between the parties. ©The Institute of Chartered Accountants of India  CONCILIATION 4.11. Section 67(3) provides flexibility in selecting the manner for conducting the conciliation proceedings on the basis of circumstances of the case. Further, if a party requests the conciliator to hear oral statements to speed-up conciliation proceedings and thereby enable early settlement of dispute, the conciliator should consider such requests. Section 67(4) empowers the conciliator to make proposal for settlement of the dispute, at any stage of the conciliation proceedings and such proposals are not required to be made in writing. Further, the conciliator is also not bound to state the reasons therefore. Administrative Assistance Section 68 — In order to facilitate the conduct of the conciliation proceedings, the parties, or the conciliator with the consent of the parties, may arrange for administrative assistance by a suitable institution or person. Section 68 deals with provisions for administrative assistance for facilitating conciliator proceedings. This administrative assistance may be in form of providing list of conciliators, providing communication services and interpretation of law provisions services. Communication between Conciliator and Parties Section 69 — (1) The conciliator may invite the parties to meet him or may communicate with them orally or in writing. He may meet or communicate with the parties together or with each of them separately. (2) Unless the parties have agreed upon the place where meetings with the conciliator are to be held, such place shall be determined by the conciliator, after consultation with the parties, having regard to the circumstances of the conciliation proceedings. Sub – section (1) of Section 69 empowers the conciliator to communicate with the parties to conciliation. According to the sub – section, the conciliator is authorised to: ♦ invite the parties to meet him or ♦ communicate with them orally or in writing. ♦ meet or communicate with the parties together or ♦ meet or communicate with each party separately. Sub – section (2) of Section 69 empowers the parties to conciliation to determine the place of meeting with their mutual consent. If there is no such agreement, the conciliator may determine the place for meeting after consulting the parties. The conciliator should also consider the ©The Institute of Chartered Accountants of India  4.12 THE ARBITRATION AND CONCILIATION ACT, 1996 circumstances of the conciliation proceedings. Example: A dispute between A and B is referred for conciliation. A belongs to Agra and B belongs to Mathura. A is interested that place of conciliation meeting should be at Agra while B wants it to be in Mathura. As there is no agreement between the parties regarding place of meeting, conciliator may decide the place for meeting after in consultation with A and B. Disclosure of Information Section 70 — When the conciliator receives factual information concerning the dispute from a party, 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 to a specific condition that it be kept confidential, the conciliator shall not disclose that information to the other party. Section 70 provides that if conciliator receives any information from one party regarding any facts related to dispute, he should disclose the substance of that information to the other party so that other party may provide the appropriate explanation to that information. Further, the proviso to section 70 provides that if any party provides any information to the conciliator with the specific condition that it should be kept confidential, the conciliator should not disclose the information to the other party. 5. SETTLEMENT AGREEMENT Section 73 — (1) When it appears to the conciliator that there exist elements of a settlement which may be acceptable to the parties, he shall formulate the terms of a possible settlement and submit them to the parties for their observations. After receiving the observations of the parties, the conciliator may reformulate the terms of a possible settlement in the light of such observations. (2) If the parties reach agreement on a settlement of the dispute, they may draw up and sign a written settlement agreement. If requested by the parties, the conciliator may draw up, or assist the parties in drawing up, the settlement agreement. (3) When the parties sign the settlement agreement, it shall be final and binding on the parties and persons claiming under them respectively. (4) The conciliator shall authenticate the settlement agreement and furnish a copy thereof to each of the parties. ©The Institute of Chartered Accountants of India  CONCILIATION 4.13. Section 73 of the Arbitration and Conciliation Act, 1996 deals with the procedure for successful completion of conciliation proceedings. Sub – section (1) provides that if the conciliator is satisfied that he is in position to frame the acceptable settlement between the parties, he will prepare the terms of settlement and submit them to the parties. Further, the parties are empowered to submit their observations on above terms. In case observations are submitted by parties, conciliator may reframe terms considering such observations. Sub – section (2) provides that if the parties are on the settlement terms framed by conciliator, they may draw up and sign a written settlement agreement. The conciliator may also help in drawing the settlement agreement, if requested by the parties. Sub – section (3) provides that at the point of time at which parties sign the settlement agreement, it attains finality and would be binding on the parties and persons claiming under them respectively. Example: Two disputing parties A & B, reached a settlement, after a conciliation proceeding. As per the terms of conciliation, A was to pay to B Rs. 6 Lakh as full and final settlement for four pending invoices. B claimed Rs. 6 lakh but later wanted to sue A for transportation charges which were already included in invoice saying Rs 6 Lakh was only for supply of goods. In such case, B cannot sue A as the settlement agreement is binding on him as he has already taken Rs. 6 Lakh as full and final settlement. Sub – section (4) requires the conciliator to authenticate the settlement agreement and to furnish a copy thereof to each of the parties. In case, there are more than one conciliator, all the conciliators should authenticate the settlement agreement. In Haresh Dayaram Thakur Vs. State of Maharashtra and Ors the honorable SC also held that the settlement takes shape only when the parties draw up the settlement agreement or request the conciliator to prepare the same and affix their signatures to it. Under sub-section (3) of Section 73, the settlements agreement signed by the parties is final and binding on the parties and persons claiming under them. It follows therefore that a successful conciliation proceeding comes to an end only when the settlement agreement signed by the parties comes into existence. Status and effect of Settlement Agreement Section 74 — The settlement agreement shall have the same status and effect as if it is an arbitral award on agreed terms on the substance of the dispute rendered by an arbitral Tribunal under section 30. ©The Institute of Chartered Accountants of India  4.14 THE ARBITRATION AND CONCILIATION ACT, 1996 Section 74 provides that settlement agreement has been given the same status and effect as if it is an arbitral award as rendered by arbitral Tribunal under section 30. It was held in case of Harsh Dayaram Thakur Vs. State of Maharashtra, the conciliation settlement between parties is binding as arbitral award. Further, the Supreme Court held in case of Mysore Cement Ltd. Vs. Suedalla Barmac Ltd. that all agreements do not acquire the status of Arbitral Award. There should be an agreement between the parties only as per the section 73. 6. TERMINATION OF CONCILIATION PROCEEDINGS Section 76 — The conciliation proceedings shall be terminated— (a) by the signing of the settlement agreement by the parties, on the date of the agreement; or (b) by a written declaration of the conciliator, after consultation with the parties, to the effect that further efforts at conciliation are no longer justified, on the date of the declaration; or (c) by a written declaration of the parties addressed to the conciliator to the effect that the conciliation proceedings are terminated, on the date of the declaration; or (d) by a written declaration of a party to the other party and the conciliator, if appointed, to the effect that the conciliation proceedings are terminated, on the date of the declaration. Section 76 provides the grounds where the conciliation proceedings can be terminated. These are as below: Acts for Termination Effective date of Termination a) By the signing of the settlement agreement by the parties. On the date of the agreement. b) By a formal written declaration by conciliator, if he is of the opinion, On the date of the after consultation with the parties that no further conciliation declaration. proceedings are required. c) By a written declaration by the parties addressed to the conciliator On the date of the for termination of the conciliation proceedings. declaration. d) By a written declaration by a party to the other party and the On the date of the conciliator, if appointed, for termination of the conciliation declaration. proceedings. ©The Institute of Chartered Accountants of India  CONCILIATION 4.15. TEST YOUR KNOWLEDGE Multiple Choice Questions (MCQs) 1. S & Co. is regularly getting supplies from R & Co. at particular rate. After a change in the management, R & Co. increased the price of supplies. S & Co. requested R & Co. not to increase the price as it will result in a big loss to it, in the peak season but R & Co. refused to it. S & Co. requested R & Co. to refer the matter for conciliation. Find the correct option. (a) Matter may be referred to conciliation even if R & Co. does not gives its consent. (b) Matter may be referred to conciliation only if R & Co. gives its consent. (c) Matter may be referred to conciliation only on the intension of S & Co. and the outcomes would be binding. (d) There is no autonomy of parties for conciliation. 2. Ram and Shyam are partners in a firm. Ram was authorised to purchase the goods while Shyam was responsible for selling the goods in the firm. Dispute arose regarding the selling price. Ram was of the view that the price should be increased while Shyam did not agree for that with the view that due the market competition price cannot be increased. Both of them agreed to have the matter conciliated. Now, conciliation proceeding shall commence: (a) When Ram sends to Shyam a written invitation to conciliate under this Part, briefly identifying the subject of the dispute. (b) When Shyam accepts in writing the invitation to conciliate. (c) When Shyam rejects the invitation. (d) When both Ram & Shyam agrees for conciliation. 3. A dispute arose between Raman and Saman. Both agreed to have matter conciliated. Raman suggested the name of Vishnu for conciliator but Saman did not agree for the same. Saman suggested that there may be more than one conciliator in their matter. Which is the incorrect statement among the following: (a) In conciliation proceedings with one conciliator, the parties may agree on the name of a sole conciliator; (b) In conciliation proceedings with two conciliators, each party may appoint one conciliator; ©The Institute of Chartered Accountants of India  4.16 THE ARBITRATION AND CONCILIATION ACT, 1996 (c) In conciliation proceedings with three conciliators, each party may appoint one conciliator and the conciliators will appoint the third conciliator who shall act as the presiding conciliator. (d) In conciliation proceedings with 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. 4. Which of the following statements is true regarding the conciliation process described? (a) Conciliation proceedings commence immediately upon receipt of the written invitation by the other party. (b) If the other party rejects the invitation, conciliation proceedings may still proceed with the consent of both parties. (c) The party initiating conciliation must receive a reply within thirty days of sending the invitation, or within a specified time frame mentioned in the invitation, for conciliation proceedings to commence. (d) If the initiating party does not receive a reply within the stipulated time frame, they have the option to proceed with conciliation proceedings without the consent of the other party. 5. Which of the following statements regarding the role of the conciliator in conciliation proceedings is correct? (a) The conciliator is not authorized to request written statements from the parties involved in the dispute. (b) Each party is required to submit a brief written statement to the conciliator upon his appointment, but they are not obligated to share it with the other party. (c) The conciliator may request each party to submit a further written statement of their position and supporting evidence, and these submissions must be shared with the other party. (d) The conciliator is prohibited from requesting additional information from the parties at any stage of the conciliation proceedings. Answers to the Multiple Choice Questions: 1. (b) 2. (b) 3. (d) 4. (c) 5. (c) ©The Institute of Chartered Accountants of India