Sections 21 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
When a mediation does not end in a settlement, three sections decide what follows. Section 21 requires the mediator to prepare a non-settlement report, section 24 lists the four ways in which mediation proceedings are deemed to terminate, and section 29 excludes the mediation period when limitation is counted.
If no agreement is reached within the section 18 period, or the mediator thinks no settlement is possible, the mediator gives a non-settlement report, which must not disclose the cause of non-settlement or the parties' conduct. Mediation is deemed terminated on a signed settlement, a mediator's declaration, a party's written opt-out, or expiry of the time limit. For limitation, the period from the commencement under section 14 up to the report or termination is excluded. The Act comes into force by notification, and the date is not in the text consulted.
Section 21: the non-settlement report
Section 21 begins "Subject to the provisions of section 26", which keeps Lok Adalat proceedings outside the Act. It applies "where no agreement is arrived at between the parties, within the time period as provided under section 18, or where, the mediator is of the view that no settlement is possible". Two triggers are therefore named: the expiry of the section 18 period without agreement, and the mediator's view that settlement is not possible. In either case the mediator "shall" proceed as follows:
| Clause | Type of mediation | What the mediator does |
|---|---|---|
| (i) | Institutional mediation | Submits a non-settlement report to the mediation service provider in writing |
| (ii) | All other cases | Prepares a non-settlement report and provides a signed copy to all the parties |
The proviso. "The report referred to in this section shall not disclose the cause of non-settlement, or any other matter or thing referring to their conduct, during mediation." The report states only that settlement was not reached. It does not give reasons or comment on how any party behaved. This protects the confidentiality duties in sections 22 and 23; see our article on confidentiality.
A party who plans to go to court or arbitration after a failed mediation will need the report as a record of the date the mediation ended. If you want help with the next step after a failed mediation, our legal dispute resolution team can advise.
Section 24: termination of mediation
Section 24 says mediation proceedings under the Act "shall be deemed to terminate":
| Clause | Event | Date of termination |
|---|---|---|
| (a) | A mediated settlement agreement is signed and authenticated | The date of signing and authentication |
| (b) | The mediator declares in writing, after consultation with the parties or otherwise, that further efforts at mediation are no longer justified | The date of the written declaration |
| (c) | A party or parties communicate in writing to the mediator and the other parties that the party wishes to opt out of mediation | The date of the communication |
| (d) | The time limit under section 18 expires | The date of expiry |
Some points of note. Clause (a) ties termination to both signing and authentication, which fits section 19. Clause (b) speaks of consultation "with the parties or otherwise", so the mediator's declaration does not depend on the parties' agreement. Clause (c) allows any party to opt out in writing; this fits the voluntariness in section 15(3). Clause (d) links to section 18, whose period is one hundred and twenty days from the date fixed for the first appearance, with a possible extension of up to sixty days; see our article on section 18.
Printing slip. As printed in the gazette, clause (c) ends with a semicolon and there is no "or" before clause (d). The list is read as alternatives, but the text is quoted as enacted.
Section 29: limitation
Section 29 reads "Notwithstanding anything contained in the Limitation Act, 1963 or in any other law for the time being in force, in computing the period of limitation fixed for any proceeding relating to disputes in respect of which a mediation has been undertaken under this Act, the period from the date of commencement of mediation under section 14, and up to" either of two end points "shall be excluded":
- clause (i): submission of report under section 21; or
- clause (ii): termination of mediation under section 24.
Stated simply, if your claim has a fixed limitation period and you spend a stretch of that time in mediation under the Act, that stretch is not counted against you. The start point is the commencement under section 14, which depends on how the mediation began (receipt of notice, mediator's consent or mediator's appointment); see our article on sections 13 and 14. The end point is stated as the submission of the report under clause (i) or the termination under clause (ii); the section does not say which governs if the two fall on different dates, so keep a record of both.
The section applies to "any proceeding relating to disputes in respect of which a mediation has been undertaken under this Act". The Act does not say the exclusion applies to a mediation outside the Act. For the general limitation periods that run for contract and civil claims, see our guide on limitation for filing suits and appeals and our guide on limitation for contract suits.
How the three sections work together
Take Gupta Traders and Nair Exports. Their mediation begins when the mediator consents to appointment. After four sessions the mediator concludes that no settlement is possible and prepares a signed non-settlement report. Section 21 is satisfied; under section 24 the mediation ends on the date of the mediator's written declaration if that was made, or otherwise on the date of any other event in the list; and under section 29 the days from commencement up to the report or termination are left out when computing limitation for any suit. Gupta Traders should diarise the date of the report and the date of termination and file within the remaining period. The names are invented for illustration.
Practical checklist
- Record the commencement date under section 14.
- Request the signed non-settlement report if it is not given.
- Note the date of termination under section 24.
- Recalculate limitation, excluding the period under section 29.
- Do not use the report to argue about who caused the failure; the proviso keeps it silent.
Need help after a mediation ends without settlement?
The days after a failed mediation are when limitation and forum choices matter most. We can help you read the report, recalculate limitation and plan the next step through our legal dispute resolution service.
Key takeaways
- A non-settlement report is due if no agreement is reached within the section 18 period or the mediator thinks settlement is not possible (section 21).
- The report must not disclose the cause of non-settlement or the parties' conduct.
- Mediation terminates on settlement, mediator's declaration, a party's written opt-out, or expiry of the time limit (section 24).
- The period from commencement under section 14 up to the report or termination is excluded from limitation (section 29).
- The Act comes into force by notification; the date is not in the text consulted.
Read next
- Section 18 of the Mediation Act, 2023: time limit for completion of mediation
- Section 22 of the Mediation Act, 2023: confidentiality of mediation
- Section 19 of the Mediation Act, 2023: mediated settlement agreement
- Limitation period for filing suits and appeals
Disclaimer: Based on the Mediation Act, 2023 as enacted and published in the Gazette of India on 15 September 2023, as consulted on 2 October 2026. The Act comes into force by notification; the commencement of each provision, the rules and the regulations should be checked. This article is general information, not legal advice; check the official text before acting.