Section 45 of Mediation Act 2023 - Mediation Fund
Section 45 of the Mediation Act, 2023 establishes the Mediation Fund for promotion, facilitation and encouragement of mediation under the Act. The Fund is administered by the Mediation Council of India and may receive Government funding, fees, grants, donations, contributions, investment income and other permitted receipts.
Section 45 - Mediation Fund
45. (1) There shall be a fund to be called "Mediation Fund" (hereinafter referred to as the "Fund") for the purposes of promotion, facilitation and encouragement of mediation under this Act, which shall be administered by the Council.
(2) There shall be credited to the Fund the following, namely:
- all monies provided by the Central Government;
- all fees and other charges received from mediation service provider, mediation institutes or bodies or persons;
- all monies received by the Council in the form of donations, grants, contributions and income from other sources;
- grants made by the Central Government or the State Government for the purposes of the Fund;
- amounts deposited by persons as contributions to the Fund;
- amounts received in the Fund from any other source; and
- interest on the above or other income received out of the investment made from the Fund.
(3) The Fund shall be applied towards meeting the salaries and other allowances of Member, Chief Executive Officer, Officers and employees and the expenses of the Council including expenses incurred in the exercise of its powers and discharge of its duties under this Act.
What is the Mediation Fund?
The Mediation Fund is the statutory fund created by Section 45 of the Mediation Act, 2023. Its stated purpose is the promotion, facilitation and encouragement of mediation under the Act. Administration of the Fund is entrusted to the Mediation Council of India, referred to in the Act as the Council.
The Council is the statutory body established under Section 31 of the Mediation Act. Section 45 provides the financial framework through which money may be received and applied for the Council and its statutory functions.
Sources of money credited to the Fund
Section 45(2) identifies a broad range of permitted receipts. These sources include:
- Central Government funding: all monies provided by the Central Government.
- Fees and charges: fees and other charges received from mediation service providers, mediation institutes, bodies or persons.
- Donations and grants: donations, grants, contributions and income from other sources received by the Council.
- Government grants: grants made by the Central Government or a State Government for purposes of the Fund.
- Voluntary contributions: amounts deposited by persons as contributions to the Fund.
- Other receipts: amounts received in the Fund from any other source.
- Interest and investment income: interest on the specified receipts or other income arising from investment made from the Fund.
How can the Mediation Fund be used?
Section 45(3) specifies the expenditure for which the Fund may be applied. It includes salaries and allowances of Members, the Chief Executive Officer, officers and employees, as well as expenses of the Council. It also includes expenditure incurred by the Council in exercising its powers and discharging its duties under the Mediation Act.
The provision therefore connects the Fund not only with promotion of mediation generally but also with the institutional and administrative functioning of the Council under the Act.
Meaning of Council under the Act
Under Section 3 of the Mediation Act, references to the Council mean the Mediation Council of India established under Section 31. Section 31 provides for establishment of the Council by the Central Government through notification, and Chapter VIII contains provisions relating to its composition, administration and functions.
Relationship between Sections 45 and 46
Section 45 establishes and governs the Mediation Fund, while Section 46 deals with accounts and audit of the Council. Section 46 requires proper accounts and relevant records, preparation of an annual statement of accounts and audit by the Comptroller and Auditor-General of India. The certified accounts and audit report are to be forwarded annually to the Central Government for laying before each House of Parliament.
The Mediation Council of India (Forms and Manner of Annual Statement of Accounts) Rules, 2024 were made under Section 51(2) read with Section 46(1). These Rules define "Fund" by reference to Section 45 and prescribe forms and accounting requirements for the Council.
Why Section 45 is important
A statutory mediation framework requires institutional funding for administration, professional standards, regulatory functions and the broader promotion of mediation. Section 45 identifies the Fund through which the Council may receive authorised money and meet expenditure connected with its statutory responsibilities.
The provision should be read together with the Council provisions in Chapter VIII and the accounts and audit requirements in Section 46 to understand the financial governance framework created by the Mediation Act.
Key legal points under Section 45
- The Fund is expressly named the "Mediation Fund".
- Its statutory purposes are promotion, facilitation and encouragement of mediation under the Act.
- The Fund is administered by the Mediation Council of India.
- Government money, fees, charges, grants, donations, contributions and other permitted receipts may be credited to it.
- Interest and other investment income may also form part of the Fund.
- The Fund may meet salaries, allowances and expenses of the Council.
- It may meet expenditure incurred in exercise of the Council's powers and discharge of its statutory duties.
- Section 46 and the 2024 accounting Rules provide the related accounts and audit framework.
Official legal sources
For authoritative legal text and current rules, refer to the official Government of India sources below.
Department of Legal Affairs - Mediation Act, 2023 official text
Legislative Department - Mediation Act, 2023
Department of Legal Affairs - Mediation Council of India Annual Accounts Rules, 2024