Section 3 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.
Section 3 is the dictionary of the Act. It gives 25 lettered definitions, clauses (a) to (y), that fix what words such as "mediation", "mediator", "party", "court-annexed mediation" and "international mediation" mean wherever they appear. Read these first, because several later sections turn on them.
Section 3 opens with "unless the context otherwise requires". "Mediation" includes conciliation, pre-litigation mediation, online mediation and community mediation, so long as a third person who cannot impose a settlement assists the parties. "Commercial dispute" is borrowed from section 2(1)(c) of the Commercial Courts Act, 2015. "Prescribed" means set by rules of the Central Government and "specified" means set by regulations of the Mediation Council of India. The Act comes into force by notification, and the date is not in the text consulted.
The definitions in plain words
The table groups the clauses by theme. The wording follows the Act; the right-hand column is a plain reading. If you are drafting a mediation clause or notice and want the defined terms used correctly, our mediation services team can review the wording.
| Clause | Term | What the Act says | Plain reading |
|---|---|---|---|
| (a) | Commercial dispute | A dispute defined in section 2(1)(c) of the Commercial Courts Act, 2015 | Same meaning as in that Act |
| (b) | Community mediator | A mediator for community mediation under Chapter X | Used in sections 43 and 44 |
| (c) | Council | The Mediation Council of India established under section 31 | The national body |
| (d) | Court | The competent court in India with pecuniary and territorial jurisdiction and jurisdiction to decide the disputes forming the subject matter of mediation, if they had been the subject of a suit or proceeding | The court that would have heard the dispute |
| (e) | Court-annexed mediation | Mediation, including pre-litigation mediation, conducted at mediation centres established by any court or tribunal | Mediation at a court's own centre |
| (f) | Institutional mediation | Mediation conducted under the aegis of a mediation service provider | Mediation run through a provider |
| (g) | International mediation | See below | Cross-border commercial disputes |
| (h) | Mediation | See below | Includes conciliation |
| (i) | Mediator | A person appointed by the parties or by a mediation service provider, including a person registered with the Council | Several mediators are read together as one |
Mediation, mediator and the Explanation
Clause (h) says "mediation" includes a process "whether referred to by the expression mediation, pre-litigation mediation, online mediation, community mediation, conciliation or an expression of similar import", where parties try to reach an amicable settlement of their dispute with the help of a third person, called the mediator, "who does not have the authority to impose a settlement". Two consequences follow. The label does not matter, only the process. And a person who can decide the dispute for the parties is not a mediator under this Act.
Clause (i) defines "mediator" as a person appointed by the parties or by a mediation service provider to undertake mediation, and includes a person registered as mediator with the Council. The Explanation says that where more than one mediator is appointed, a reference to "a mediator" is a reference to all of them. Duties such as disclosure of conflicts under section 10 therefore fall on each member of a panel.
International mediation
Clause (g) has four limbs. The mediation must be undertaken under this Act and relate to a commercial dispute arising out of a legal relationship, contractual or otherwise, under any law for the time being in force in India. At least one party must be:
- an individual who is a national of, or habitually resides in, a country other than India; or
- a body corporate, including a Limited Liability Partnership, with its place of business outside India; or
- an association or body of individuals whose place of business is outside India; or
- the Government of a foreign country.
Section 4(6) adds a rule for the mediation agreement in such cases, discussed in our article on the mediation agreement.
Communications, participants and parties
Clause (k) defines "mediation communication" broadly: anything said or done, any document or any information provided, in electronic form or otherwise, for the purposes of, in relation to or in the course of mediation. It expressly includes a mediation agreement and a mediated settlement agreement. This matters for confidentiality under sections 22 and 23.
Clause (r) defines "participants" as persons other than the parties who participate in the mediation, including advisers, advocates, consultants, technical experts and observers. Clause (s) defines "party" as a party to a mediation agreement or mediation proceeding whose agreement or consent is necessary to resolve the dispute, and it includes their successors. If you manage a business dispute and are wondering whether your accountant or lawyer is a "party", the answer under clause (r) is that they are participants, not parties.
Place of business
Clause (t) says "place of business" includes a place where business is ordinarily carried on (including a warehouse, godown or other place where a party stores, supplies or receives goods or services), a place where a party maintains its books of account, and a place where a party does business through an agent, by whatever name called. As printed in the gazette, the three limbs are lettered (a), (b) and (c) inside clause (t), and the first limb reads "it's goods" for "its goods"; both are drafting slips in the text.
Pre-litigation mediation, online mediation and electronic signatures
Clause (u) defines "pre-litigation mediation" as mediation under section 5, for settlement of disputes before filing a suit or proceeding of civil or commercial nature before a court or a tribunal notified under section 5(2). Clause (q) points online mediation to section 30. Clause (x) says "secure electronic signature", for online mediation, means electronic signatures referred to in section 15 of the Information Technology Act, 2000. Details are in the article on online mediation.
Institutions, the Council and the rule-making words
Clause (l) defines a "mediation institute" as a body or organisation that provides training, continuous education and certification of mediators and carries out other functions under the Act. Clause (m) points "mediation service provider" to section 40(1). Clause (o) says "Member" means a Full-Time or Part-Time Member of the Council and includes the Chairperson. Clause (p) says "notification" means a notification published in the Official Gazette.
Clauses (v) and (y) matter most for the practical details. "Prescribed" means prescribed by rules made by the Central Government under the Act; "specified" means specified by regulations made by the Council. Many sections, for example on the conduct of mediation, the cost of mediation and the registration fee, say "as may be specified", so the detail sits in regulations. No rules or regulations are in the text consulted, so this article states no fee, form or qualification.
Clauses (j) and (n) simply refer back to section 4(1) for "mediation agreement" and section 19(1) for "mediated settlement agreement". Clause (w) says "Schedule" means the Schedule annexed to the Act.
Need help with mediation clauses and defined terms?
A clause that says "mediation" but does not say who appoints the mediator, or which body administers it, often creates a dispute of its own. We can review or draft the clause and the notice that starts the process through our mediation services.
Key takeaways
- Section 3 gives clauses (a) to (y); read them with "unless the context otherwise requires".
- Mediation includes conciliation and similar processes, and the mediator cannot impose a settlement.
- Commercial dispute takes its meaning from the Commercial Courts Act, 2015.
- International mediation needs a commercial dispute and at least one foreign-linked party.
- "Prescribed" means rules of the Central Government; "specified" means regulations of the Council.
Read next
- Sections 1-2 of the Mediation Act, 2023: commencement and application
- Section 4 of the Mediation Act, 2023: the mediation agreement
- Sections 40-42: mediation service providers and mediation institutes
- The Mediation Act 2023 for commercial and trade disputes
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.