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Section 81: Admissibility of evidence in other proceedings

Arbitration and Conciliation Act, 1996 • Official Statutory Text & Practice Guide

Statutory Regulation
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Competent Court / Tribunal
Act 1996
Section 80 All 87 Sections Schedules (4th, 5th, 7th) Section 82
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Arbitration Sec 2(1)(a)

Legal Commentary & Landmark Judgments: Section 81

Section 81 of the Arbitration and Conciliation Act, 1996 establishes an absolute rule of evidence precluding the admissibility of any proposals, admissions, views, or willingness to settle expressed during conciliation in any subsequent arbitral or judicial proceedings.

  • Inadmissibility of Conciliation Admissions: The parties shall not rely on, or introduce as evidence in arbitral or judicial proceedings, whether or not such proceedings relate to the dispute that was the subject of the conciliation: (a) views expressed or suggestions made by the other party in respect of a possible settlement; (b) admissions made by the other party; (c) proposals made by the conciliator; (d) the fact that the other party had indicated their willingness to accept a proposal for settlement.
  • Absolute Without Prejudice Protection: Statutorily enshrines the 'without prejudice' privilege in its most absolute and uncompromising form.
  • Court & Arbitrator Bound to Reject: Judges and arbitrators are legally bound to refuse to look at or record conciliation proposals.
Key Landmark Precedents:
  • Afcons Infrastructure Ltd. v. Cherian Varkey Construction Co. (P) Ltd., (2010) 8 SCC 24: The Supreme Court authoritatively ruled that Section 81 contains an absolute evidentiary bar; any attempt to place conciliation offers or admissions before a court or arbitrator is illegal and must be discarded from the record.
  • Haresh Dayaram Thakur v. State of Maharashtra, (2000) 6 SCC 179: Reaffirmed that the sanctity of settlement negotiations depends entirely on the robust enforcement of Section 81 confidentiality.
Courtroom Practice & Strategic Litigation Guidance:

If the opposing party annexes conciliation emails or settlement drafts to their Statement of Claim or court affidavit, file an application under Section 81 demanding that the court strike the exhibits off the record and impose costs for breach of privilege.

Section 80 All 87 Sections Schedules (4th, 5th, 7th) Section 82