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CS Professional · Arbitration, Mediation and Conciliation · Conciliation Proceedings and International Perspective of Conciliation

Conciliation is under way between Ganga Steel Ltd (Kolkata) and Pacific Metals Pte Ltd (Singapore). Ganga fears a limitation period will expire shortly on its claim and wants to file a court suit now. What is the position?

Ganga may file the suit. Section 77 generally prohibits starting arbitral or judicial proceedings during conciliation on the same dispute, but permits a party to do so where, in its opinion, such proceedings are necessary for preserving its rights, such as against limitation.

  1. AGanga can never file a suit while conciliation is pending
  2. BGanga may file if, in its opinion, the proceedings are necessary for preserving its rightsCorrect
  3. CGanga may file only with written consent of Pacific Metals
  4. DGanga may file only after the conciliator terminates the proceedings

Explanation

Section 77 bars arbitral or judicial proceedings during conciliation on the subject dispute, except where a party considers in its opinion that they are necessary to preserve its rights. Consent of the other party or termination is not required, so those options are wrong.

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