1. By its order dated December 07, 2010 in Civil Appeal No. 1095 of 2008


2. Section  89. Settlement of disputes outside the Court -1) Where it appears to the court that there exist elements of a settlement which may be acceptable to the parties, the Court shall formulate the terms of settlement and give them to the parties for their observations and after receiving the observations of the parties, the court may reformulate the terms of a possible settlement and refer the same for—


1. arbitration;


2. conciliation;


3. judicial settlement including settlement through Lok Adalat;

or
4. mediation.


3. Where a dispute has been referred—


1. for arbitration or conciliation, the provisions of the Arbitration and Conciliation Act, 1996 (26 of 1996) shall apply as if the proceedings for arbitration or conciliation were referred for settlement under the provisions of that Act;


2. to Lok Adalat, the Court shall refer the same to the Lok Adalat in accordance with the provisions of sub-section (1) of Section 20 of the Legal Services Authority Act, 1987 (39 of 1987) and all other provisions of that Act shall apply in respect of the dispute so referred to the Lok Adalat;


3. for judicial settlement, the Court shall refer the same to a suitable institution or person and such institution or person shall be deemed to be a Lok Adalat and all the provisions of the Legal Services Authority Act, 1987 (39 of 1987) shall apply as if the dispute were referred to a Lok Adalat under the provisions of that Act;


4. for mediation, the Court shall effect a compromise between the parties and shall follow such procedure as may be prescribed.]


Note.—For provisions as to commencement and application of the above amendments made by Act 46 of 1999, Repeal and Savings provision, see Section 32(2)(e) of the CPC (Amendment) Act, 1999 (Act 46 of 1999), given in the Appendices.


4. Section 75 of the Arbitration & Conciliation Act, 1996