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

Gupta Steels invited Hindustan Alloys to conciliate and Hindustan accepted in writing. During the proceedings, Hindustan's manager suggested a staggered payment plan. Hindustan then sent a written declaration to Gupta and the conciliator terminating the conciliation. Gupta later started arbitration and wants to prove the suggested payment plan. Which statement is correct?

Gupta still cannot rely on the suggestion. Section 81(a) bars use of the other party's settlement suggestions in arbitral or judicial proceedings, and nothing in the section ends that bar when conciliation is terminated, including by a party's written declaration under Section 76.

  1. ATermination of conciliation lifts the bar, so the suggestion becomes admissible
  2. BThe suggestion remains something Gupta cannot rely on in arbitral proceedings under Section 81(a)Correct
  3. CThe suggestion is admissible only if the arbitral tribunal agrees to hear it
  4. DThe suggestion is barred only until the conciliator submits a report

Explanation

Section 81 contains no time limit tied to termination of conciliation under Section 76. The bar on relying on the other party's settlement suggestions in arbitral or judicial proceedings continues after termination. Hence termination by Hindustan's written declaration does not make the suggestion usable.

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