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CS Professional · Arbitration, Mediation and Conciliation · Introduction to Conciliation and its Importance for MSMEs

Mehra Foods invites Rao Packaging in writing to conciliate a dispute, stating that a reply is required within fifteen days. Rao Packaging replies in writing on the twentieth day, accepting the invitation. Mehra Foods had not by then informed Rao Packaging that it treated the silence as rejection. Which statement best applies Section 62?

Lapse of the specified period does not automatically reject the invitation. Mehra only has an option to treat silence as rejection and must inform Rao in writing. Since it did not, Rao's written acceptance under Section 62(2) commences the conciliation proceedings.

  1. ANo conciliation can ever commence because the fifteen-day period has lapsed
  2. BConciliation commences automatically on the fifteenth day
  3. CMehra could elect to treat silence as rejection after fifteen days, but until it does so and informs Rao in writing, the written acceptance commences proceedingsCorrect
  4. DConciliation commences only after Mehra obtains the consent of the Tribunal

Explanation

Section 62(4) only gives the initiating party an option to treat non-reply within the specified period as rejection, and it must inform the other party in writing if it so elects. No such election was made, so Rao's written acceptance under Section 62(2) commences proceedings. Lapse of the period does not itself amount to rejection.

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