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Effectiveness of Pre-Institution Mediation and Settlement under the Commercial Courts Act: A Data-Driven Analysis

I. Abstract

The Commercial Courts Act, 2015 was amended in 2018 to introduce, among other things, the Pre-Institution Mediation and Settlement (PIMS) mechanism under Section 12A. Under this mechanism, where a commercial dispute of specified value does not contemplate any urgent interim relief, the parties have to first exhaust the mandatory remedy of PIMS before approaching the Court.

This blog analyses the functioning of this mechanism through available data. It also examines the evolving regulatory framework that increasingly mandates data disclosure in relation to PIMS.    

II. Introduction

Section 12A of the Commercial Courts Act, 2015, (‘Act’) inserted through the 2018 amendment, makes Pre-Institution Mediation and Settlement (PIMS) mandatory for commercial disputes of specified value (more than 3 lakhs rupees) that do not contemplate urgent interim relief1. Its purpose is to give parties an opportunity to settle disputes through mediation before approaching the court, thereby promoting quicker and more efficient dispute resolution.

III. Data Publication of Commercial Courts

From its inception, the Commercial Courts Act, 2015 embedded the collection and publication of statistical data within its legal framework. Section 17 of the Act mandates High Courts to record and publish data on the number of suits, applications, appeals, and writ petitions filed before Commercial Courts2. This reflects an early legislative emphasis on transparency and performance monitoring within the commercial dispute resolution system. This framework was further strengthened through the introduction of the Commercial Courts (Statistical Data) Rules, 2018, which prescribed both a standardized format and a timeline for data publication3. Under these Rules, High Courts are required to publish statistical data in a specified Schedule by the tenth day of each month, thereby ensuring regular and uniform reporting. This requirement ensures regularity and consistency in reporting across jurisdictions. Importantly, the standardised format allows for comparability of data between courts, making it easier to identify trends in filings, disposals, and pendency. In 2020, the Central Government introduced the Commercial Courts (Statistical Data) Amendment Rules, 2020, which expanded the scope of reporting by mandating the publication of more granular data4. The amendment refined the reporting framework by prescribing detailed schedules and reinforcing the requirement of monthly publication, thereby enhancing the depth and usability of the data collected. The Rules introduced detailed schedules requiring monthly reporting on various aspects of case progression. The Rules prescribed monthly publication of:
  • Data of efiling,
  • Data on  e-Payment of Court fees,
  • Data on Electronic Service of Process,
  • Data on total number of cases randomly allocated,
  • Data on hearing,
  • Data on disposal, and 
  • Summary Data of commercial cases

IV. Mandatory nature of PIMS

The Supreme Court in Yamini Manohar v. T.K.D. Keerthi5 held that parties cannot avoid the mandatory requirement of PIMS under Section 12A merely by including a prayer for urgent interim relief. It clarified that Commercial Courts must examine the plaint, documents, and surrounding facts to determine whether urgent interim relief is genuinely required. If the court is not satisfied that such urgency exists, the parties must first undergo pre-litigation mediation so that the legislative purpose of Section 12A is not defeated. Thus, PIMS forms a mandatory part of the framework under the Commercial Courts Act, with exceptions being permitted in limited cases.

V. Data Analysis

The table presented below has been sourced from an official statement made by the Government of India. It was provided by Arjun Ram Meghwal, Minister of State (Independent Charge) for the Ministry of Law and Justice, in a written reply to a question in the Rajya Sabha6. 

It captures nationwide trends in pre-institution mediation under the Commercial Courts Act, 2015, since the 2018 amendment. Analysing this data is important because it provides one of the few consolidated, longitudinal snapshots of how PIMS is functioning in practice. By examining trends in filings, non-starter rates, and settlements over time, the data helps move the discussion beyond legislative intent to actual performance. It allows us to identify gaps between design and implementation, assess whether mediation is being meaningfully adopted, and evaluate whether the mechanism is achieving its core objective of reducing litigation and enabling early dispute resolution.   

PeriodApplications received for mediationApplications where mediation remained non-starterApplications where parties reached settlement
July 2018 to March 20193,6801,66025
2019-2018,08014,470167
2020-2118,36414,014186
2021-2232,33528,441368
2022-2346,41241,8981,449
2023-2451,01947,1851,139
2024-2559,56852,730877
2025-26 (up to Sept. 25)47,21830,353643

Source: PIB press release dated January 29, 20267   

The rise in filings under PIMS may look encouraging at first. Since 2018, the number of applications has increased almost sixteen times, reaching nearly 60,000 in 2024-25. But this does not necessarily mean that businesses are choosing mediation because they find it useful. In many cases, they are filing only because the law requires them to do so before going to court. The increase in numbers, therefore, shows compulsion more than genuine acceptance of mediation.

A bigger concern is the growing number of non-starter cases.The DSLSA Standard Operating Procedure states that a matter is treated as a “non-starter” where service is not effected, where the defendant refuses to enter the mediation process, or where the defendant denies the plaintiff’s claim8. In 2018-19, about 45% of the cases were non-starters. By 2024-25, this had gone up to nearly 89%. This shows that while more cases are being filed, the system is becoming less effective in practice. Filing may be mandatory, but participation is not.

The settlement numbers make this problem even clearer. The best year was 2022-23, when 1,449 cases were settled through mediation. After that, settlements dropped to 1,139 in 2023-24 and then to 877 in 2024-25, even though the number of filings continued to rise. This means that out of every 100 businesses that enter the PIMS process, about 89 do not even begin mediation, and fewer than 2 end up settling.

Seen this way, the real problem is that the process is not leading to meaningful participation or resolution. For PIMS to work better, the focus should be on encouraging parties to genuinely engage in mediation, improving the quality of mediators, and building trust in mediation as a real way to resolve disputes, rather than just another procedural step before litigation.

VI. Conclusion

PIMS was introduced with an important goal: to help parties resolve commercial disputes early and reduce the burden on courts. In principle, it reflects a valuable shift towards faster and less adversarial dispute resolution. But the data shows that the promise of the mechanism has not yet translated into real success. Rising filings may suggest growth, but high non-starter rates and low settlement numbers reveal that the process is often treated as a procedural formality rather than a genuine opportunity for resolution.   

If PIMS is to work as intended, the focus must now move beyond making parties file applications. What matters is whether parties actually participate, whether mediators are equipped to handle commercial disputes effectively, and whether businesses begin to see mediation as a serious and useful alternative to litigation. Until then, PIMS will remain a strong idea in law, but a weak one in practice.

1The Commercial Courts Act, 2015, No. 4 of 2016, § 12A
2The Commercial Courts Act, 2015, No. 4 of 2016, § 17
3Commercial Courts (Statistical Data) Rules, 2018, r. 3
4Commercial Courts (Statistical Data) Amendment Rules, 2020
5Yamini Manohar v. T.K.D. Keerthi, 2023 SCC OnLine SC 1382
6Ministry of Law and Justice, Government of India, Pre-Institution Mediation and Settlement under the Commercial Courts Act, 2015, Press Information Bureau (Jan. 29, 2026)
7id.
8Delhi State Legal Services Authority, Standard Operating Procedure for Pre-Institution Mediation and Settlement 3–4 (2020)

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