CS Professional December 2025 Question Paper Arbitration, Mediation and Conciliation

FOR CS PROFESSIONAL EXAM PREPARATION

CS Professional 2025
Question Paper ·
Arbitration,
Mediation and
Conciliation
EXAM YEAR TYPE

CS Professional 2025 Question Paper
SUBJECT DATE

Arbitration, Mediation and Conciliation December 2025

Notes · Sample Papers · Previous Year Papers · Mock Tests

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NEW SYLLABUS
551
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OPEN BOOK EXAMINATION

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Time allowed : 3 hours

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a of questions : 6
Total number Total number of printed pages : 15

NOTE : Answer ALL Questions.

PART–I

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1.
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. Ltd (‘Pentagon’) for the development and
In January 2024, Aarohan Pharma Private Ltd (‘Aarohan’), a reputed pharmaceutical manufacturer,

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eThe contract, valued at ` 150 crore, contained detailed
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entered into a contract with Pentagon Lifesciences

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supply of a new line of oncology drugs.
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lmanufacturing timelines, quality control standards, penalties
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provisions on regulatory approvals,
for delay, variation in technical specifications and dispute resolution. Clause 21 of the agreement
stipulated that disputes would be resolved through arbitration under the Arbitration and Conciliation
Act, 1996, with Hyderabad as the seat and proceedings governed by CIAC Rules. By April
2024, disagreements surfaced as Aarohan alleged that Pentagon delayed release of milestone-
based payments and failed to provide timely approvals for raw material sourcing protocols, leading
to cost overruns. Pentagon countered that Aarohan had missed regulatory submission deadlines,

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used substandard excipients in certain trial batches, and ignored directions from the joint project
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monitoring committee. Quality inspections conducted by Pentagon revealed compliance defects

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in two pilot production runs, which Pentagon relied on to withhold further payments. Tensions

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escalated and after weeks of negotiation, the parties signed a Settlement Agreement on July 15,
2024. Pentagon agreed to pay Aarohan ` 30 crore in full and final settlement of all claims,
while Aarohan agreed to transfer all partially developed product dossiers and trial data to another
manufacturer appointed by Pentagon. However, the settlement did not expressly reaffirm or exclude
the arbitration clause.

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In October 2024, Aarohan, aggrieved that the compensation did not cover its actual R&D

and manufacturing expenses, issued a Notice of Arbitration invoking Clause 21 of the original

contract. Pentagon objected, contending that the settlement agreement had superseded the

original contract and extinguished the arbitration clause. Further, Pentagon challenged Aarohan’s

nominated arbitrator, citing the arbitrator’s past professional ties with Aarohan’s counsel. Aarohan

then approached the Court seeking constitution of an arbitral tribunal, supporting its application

with correspondence, invoices and the disputed settlement terms.

Based on the above facts, answer the following questions :

(a) Discuss the general conditions typically included in pharmaceutical R&D and supply

contracts.

(b) Explain the essential contents which Aarohan’s notice must include under the Arbitration

and Conciliation Act, 1996 and institutional rules.

(c) Elucidate the legal grounds on which Pentagon can challenge the appointment of Aarohan’s

nominated arbitrator.

(d) Draft an agreement to submit the dispute to an arbitral tribunal, assuming necessary

facts.

(e) Outline the essential components in drafting an affidavit in support of Aarohan’s application

before the court for appointment of an arbitrator.

(5 marks each)

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2. (a) The dispute arose from an International Exclusive Distributor Agreement signed

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in May 2016 between Disortho S.A.S., a Colombian company, and Meril Life Sciences

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Private Limited, an Indian company, for distributing medical products in Colombia.

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a confusion :
The agreement contained two seemingly contradictory clauses that created jurisdictional

Clause 16.5 stated that the agreement “shall be governed by and construed in
accordance with the laws of India and all matter pertaining to this agreement....will
be subject to the jurisdiction of courts in Gujarat, India”.

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Clause 18 provided for disputes to be resolved through “Arbitration by either party

em taking place in Bogota and awards governed
for final settlement in accordance with the Arbitration and Conciliation Center of the
Chamber of Bogota DC” with sarbitration

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by Colombian law.
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With reference to a decided case law, how will you determine jurisdiction in international
commercial arbitration when contractual clauses conflict.

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(b) The genesis of the dispute lies in a notification dated 28.07.2006 issued by the Central

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Government under Section 3A(1) of the National Highways Act, 1956 (“NH Act”),

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a formal acquisition,
acquiring land in Baghpat, Uttar Pradesh. While some land was acquired through due
notification, possession of an additional portion was takenlwithout
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as per notification dated 08.02.2007. Aggrieved by the lack of compensation for such
acquisition, the Petitioners filed a Writ Petition before the Delhi High Court seeking
quashing of the acquisition and payment of compensation.

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Pursuant to the Court’s directions, compensation was awarded in 2019. Dissatisfied

with the quantum, the Petitioners approached the District Collector, Division Meerut

under Sections 3G(5) and 3G(7) of the NH Act, seeking enhanced compensation.

The claim was rejected on 16.10.2020, leading to the filing of a Section 34 petition

under the A&C Act before the Delhi High Court.

The Respondents raised a preliminary objection to the maintainability of the petition

on the ground of lack of territorial jurisdiction, arguing that the arbitration proceedings,

land, and prior actions all occurred within Baghpat, U.P., and hence, only the local

court there would have jurisidiction.

With reference to a decided case law, comment :

(1) Can a writ petition be considered as an “earlier application” under Section

42 of the Arbitration and Conciliation Act, 1996, to confer exclusive jurisdiction

on a particular court ?

(2) What is the scope of Section 42 in determining jurisdiction where arbitration

arises under a special statute like the National Highways Act ?

(c) The dispute arose between Bentwood Seating System (P) Ltd. (the Appellant) and

the Airport Authority of India (AAI) (the Respondents) over a contract for the supply

and maintenance of baggage trolleys at various airports. The Respondents alleged that

the Appellant had obtained the contract using forged documents.
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Initially, an arbitral tribunal was set up to resolve the matter. The tribunal ruled in
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favor of o
.c the Appellant, setting aside AAI’s termination order. However, AAI challengedsem
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AAI also filed a criminal complaint, claiming that the Appellant had submitted forged

performance certificates from foreign airports to qualify for the tender. The matter

eventually reached the Delhi High Court, which ruled that such serious allegations of

fraud required examination by civil courts.

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Based on a decided case law, examine how the fraud allegation can nullify the effect

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3. (a) A petition was instituted under the Arbitration and Conciliation Act, 1996 for appointment

of a sole arbitrator in a dispute between AMP Group (petitioner) and JRS Group

(respondent). The arbitration clause formed part of a written agreement executed between

the parties. During proceedings, an attempt was made to bring SRG Group, a non-

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signatory, within the ambit of the arbitration clause on the basis that it had been

c. o actively involved in the negotiation, execution and performancemof the contract.
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legitimately

arbitration agreement.

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(b) Gayatri Balasamy and M/s ISG Novasoft Technologies Limited had entered into a

contractual relationship that led to the arbitration of disputes between them. Following

disagreements regarding the execution of the contract, disputes arose, prompting the

invocation of the arbitration process as per the Arbitration and Conciliation Act, 1996.

The arbitral tribunal made its award based on the submissions and evidence presented

by both parties. However, the award was challenged by the Appellant, which resulted

in a protracted legal battle, necessitating judicial intervention to address the limitations

and scope of modification powers under Section 34 of the Act. The complexities

intensified as conflicting judgments emerged from various courts regarding whether judiciary

powers could extend to modifying arbitral awards, thus leading to the Supreme Court’s

involvement to seek clarity on this critical issue.

The legal action commenced when Gayatri Balasamy sought to set aside the arbitral

award through a petition under Section 34 of the Arbitration and Conciliation Act,

citing various grounds that questioned the validity and reasoning of the award. The

central legal issue that arose was whether the courts possessed the authority to modify

an arbitral award or if their powers were strictly limited to setting aside the award

based on the specified grounds. This led to differing judicial interpretations over the

years and generated substantial debate surrounding the appropriate judicial oversight

in arbitration matters, ultimately resulting in the Supreme Court’s referral for a larger

Bench to resolve these pivotal questions of law.

2/2025/AMC/OBE Contd. ........

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Based on a decided case law, examine :
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. o courts have power under Sections 34 and 37 of the Arbitration Act em
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(1)

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(2) modify
the award.

(c) Nexa Engineering Private Ltd (“Nexa”), a company specializing in the manufacture
of prefabricated steel structures and heavy engineering components, and Harbor
Constructions Ltd (“Harbor”), a major infrastructure developer, had entered into a

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contract in 2020 for the supply of customized steel beams, girders, and modular

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engineering goods required for the construction of elevated tracks in a metro rail project.

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The contract contained an arbitration

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Act, 1996. Nexa supplied several
but Harbor withheld payment, alleging that some components were not in conformity
with project specifications. Nexa, disputing this allegation, invoked arbitration and filed
its statement of claim for recovery of the outstanding dues with interest. Harbor filed
its statement of defence, maintaining that Nexa’s supplies were defective and caused
project delays. After filing its statement of claim, Nexa failed to attend subsequent

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hearings. The arbitral tribunal, invoking Section 32(2)(c), terminated the proceedings
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on the ground that continuation had become unnecessary. Nexa challenged this order,

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contending that mere absence from hearings cannot be treated as abandonment of

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With reference to a case law, discuss whether the arbitral tribunal is justified in terminating
the proceedings.

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Attempt all parts of either Q. No. 4 or Q. No. 4A

4. (a) “Section 29B of the Arbitration and Conciliation Act, 1996, introduces a “fast track
procedure” for resolving disputes through arbitration. This procedure allows parties to
opt for a quicker, more streamlined process, typically involving a sole arbitrator and
primarily relying on written submissions rather than oral hearings.” What are the key
features of section 29B ?

(b) Indus Biotech Private Limited issued Optionally Convertible Redeemable Preference
Shares (OCRPS) to Kotak India Venture (Offshore) Fund through share subscription
and shareholders agreements. When Indus opted for a Qualified Initial Public Offering
(QIPO), Kotak chose to convert its preference shares into equity shares in accordance
with regulation 5(2) of SEBI (ICDR) Regulations, 2018. However, a dispute emerged
over the calculation and conversion formula for this transformation. Kotak claimed a
30% stake in the paid-up share capital of the equity shares upon conversion, while
Indus argued for only a 10% stake.

The central issue in this dispute revolved around whether Kotak’s exercise of redemption
options constituted a ‘default’ under the Insolvency and Bankruptcy Code (IBC), allowing
them to initiate insolvency proceedings against Indus using a Section 7 petition as
a financial creditor. Indus contended that discussions regarding the conversion of shares,
rather than redemption, had taken place, and until a resolution was reached on the
disagreement about the percentage of equity shares to be allocated, there was no
obligation to repay, thus implying no ‘debt’ or ‘default’ under the IBC.

2/2025/AMC/OBE Contd. ........

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In response to Kotak’s Section 7 petition, Indus filed an Arbitration Application under
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Section o
.c 8 of the Arbitration and Conciliation Act, 1996, with the aim of resolvingsem
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s e dispute through arbitration. The National Company Law Tribunal (NCLT) granted g l
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a dismissing the Section 7 petition. Kotak, dissatisfied with the NCLT’s ruling, sought
redress from the Supreme Court.

Whether it is permissible to file an application for arbitration under Section 8 of the
Arbitration and Conciliation Act after an insolvency resolution petition under Section 7
of the IBC has been admitted ?

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e concerning enforcement of an arbitration clause
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(c) A dispute arose between InfoTeck Global Services Ltd. (“InfoTeck”) and NextGen

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Power Solutions Private Ltd (“NextGen”)
in an IT implementationa and
InfoTeck was engaged to design and implement a customized Enterprise Resource
Planning (ERP) system and provide integrated IT support services for NextGen’s energy
distribution business. The agreement included milestones for delivery, penalties for dalay
and contained a detailed arbitration clause governed by the Arbitration and Conciliation

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Act, 1996. When disputes arose over alleged breaches and non-payment of invoices,

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of a sole arbitrator. NextGen objected at the threshold, contending. that the contract
InfoTeck invoked arbitration and filed a petition under Section 11(6) for appointment

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was inadmissible in evidence, as it had not been duly stampedsunder the Indian Stamp
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Act, 1899 and therefore, no arbitral proceedings could validly
contention valid ? Discuss with reference to a case-law.

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OR (Alternate Question to Q. No. 4)

4A. (i) A matter has come up for arbitration wherein the IGRP Investor Grievances Redressal

Panel) has rejected the claim of the applicant for losses suffered for about

` 3,75,000/- due to mishandling of trading in derivatives by the representative of

respondent, the trading member. The applicant is a Doctor by profession. He is having

trading account with respondent which is a stock broking company since the year

2019. In the month of October-November 2022 an employee of respondent, who

was assigned as Applicant’s Relationship Manager (RM) advised to trade in derivatives.

The Applicant informed that he was not an expert in the field but RM assured that

she would deal on his behalf.

The applicant suffered a loss of approximately ` 80,000/- in the beginning, he directed

her to stop trading and further directed her to revive the losses. She assured that

she will recover losses and thereafter will stop trading in derivatives. Despite recovery

of said loss, she continued to deal and further purchased 30 lots, no stop loss was

demarcated and applicant suffered a loss of ` 1,50,000/-. The applicant directed the

employee not to deal any further, but she assured that she will recover losses incurred

and purchased 250 shares of Adani Green which started losing due to the Hindenburg

report. She did not sell these shares despite request by the applicant resulting in

huge losses. The respondent trading member has opposed the claim. The account

opening form of the applicant—claimant has been filed to show that he became registered

constituent since June 2020.

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Explain. om . co
Is there any opportunity of winning the matter of the applicant before arbitrator ?

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a(ii) X, an eminent arbitration practitioner having substantial knowledge and experience in
institutional arbitration, both domestic and international, has been nominated as a member

of the Arbitration Council of India by the Central Government. Subseqauently, it was

found that X has acquired such financial interest as is likely to affect prejudicially

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his functions as a Member and hence the Central Government removed X and Y

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was appointed in his place. Advice X, when a member of the council can be removed.

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(iii) a
“Section 57 of the Arbitration and Conciliation Act, 1996, plays a pivotal role in

ensuring the enforcement of foreign arbitral awards governed by the Geneva Convention.

By establishing clear conditions for enforecement, it protects the interests of both parties

and upholds India’s commitment to international arbitration. While challenges remain,

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continued reforms and judicial clarity can further enhance the section’s effectiveness,

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fostering greater confidence in India’s arbitration regime.” Mention conditions for

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enforcement of foreign awards as provided under section 57(1). Can the enforcement

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of an award be refused by the Court even if all the conditions under section 57(1)

are fulfilled ?

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PART–II

5. Luminex Technologies Private Ltd (‘Luminex’), a Bengaluru-based software company, entered

into a five-year service contract with Helios Infrastructure Ltd (‘Helios’), a Noida-based

construction firm, for the supply of customized project management software. Within two years,

disputes arose when Helios alleged that the software failed to integrate with its existing systems,

causing delays and financial losses. Luminex denied liability, asserting that Helios had repeatedly

altered specifications, leading to additional costs and project overruns. Being a listed company,

Helios lodged a formal complaint with the stock exchange. Before escalation, both parties

were advised to attempt e-mediation through the newly established Online Dispute Resolution

(ODR) portal. Recognizing the advantages, both parties consented to proceed with this process

and a mediator was appointed.

At the outset, the mediator directed the parties to execute a mediation agreement, setting

out the framework of the process. Luminex readily agreed, but Helios expressed hesitation,

fearing that signing such an agreement might projudice its rights in any subsequent arbitration

or litigation. Further differences arose over the mode of mediation. Luminex preferred

ad-hoc mediation, citing flexbility and lower costs, while Helios insisted on institutional mediation

under a SEBI-accredited centre, emphasizing structured procedures and enforceability. With

no consensus reached, the parties were left to balance efficiency, cost and legal certaintly

before proceeding.

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Based on the above facts, answer the following questions :
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Draft acmediation
. agreement for resolution of dispute between Luminex and Helios, m
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(a)

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assuming necessary facts.

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a(b) Explain the concept of e-mediation, highlighting its benefits and challenges.
marks)

(4 marks)

(c) Outline the distinction between ad-hoc mediation and institutional mediation.

(4 marks)

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Attempt all parts of either Q. No. 6 or Q. No. 6A

e m conflict and want to avoid a costly court battle,
6. (a)
a s of mediation can help them choose the best resolution
“When parties are involved in serious
understanding the different l
ag from traditional negotiation-based formats to more
types
path. Each mediation approach,
structured hybrids like mediation vs. arbitration, follows unique principles based on
the nature of the dispute. Before selecting a mediator, it’s essential to understand how
various mediation styles work”.

Explain the Med-Arb and Arb-Med types of mediation.

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(b) “Even though mediation is speedier, more cost-effective and offers greater possibility

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of preserving the relationship between disputing parties, the existing mediation framework

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in India has not allowed for reaping its full potential. The Supreme Court highlighted
some glaring drafting errors in Section 89 in its landmark
Infrastructure Ltd. case.” What are the difficulties confronted by the Mediator while
implementing the process of mediation ?

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(c) Plinto Ltd is facing a complex workplace dispute involving cultural differences and
gender-related concerns among employees. To ensure a fair and effective resolution,
the management has decided to adopt a co-mediation approach by engaging experts
from diverse fields.

As a corporate advisor, explain how co-mediation can enhance the dispute resolution
process in such scenarios.

Or (Alternate Question to Q. No. 6)

6A. (i) Appellant M.R. Krishna Murthi was only 18 years of age when he suffered a severe
accident on the 26th of May in the year 1988 while traveling with his mother from
Delhi to Mussoorie. A crash had occurred where the other vehicle was negligent in
driving it crushed his left leg. After three major surgeries, he still has metal plates
and screws in the femur. The District Government Hospital of Muzaffarnagar certified
him as permanently disabled at 40 percent.

He filed a compensation claim at the Motor Accident Claims Tribunal (MACT) which
was transferred to Patiala House Courts at New Delhi. The case spent its last day
on 23rd of May in the year 2007, after this MACT came up with a judgment awarding
` 8,48,000 including interest at 7% for 10 years, noting the procedural delays and
dismissals in default. The report concluded the liability with respect to the insurer,
driver, and vehicle owner. Notably, the Tribunal considered delays caused due to the
petition being dismissed in default on two separate occasions.

Based upon judicial pronouncements, explain the significant considerations in the realm
of motor accident compensation.

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(ii)
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Artificial intelligence (AI) for helping mediate disputes has begun to gain traction. Although
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em providing mediators with tools and functionalities that streamline the mediation
it might

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la process, offer data-driven insights, and help manage communications and negotiations.
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resolution,

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The use of AI in mediation looks both promising and transformative and presents

opportunities and challenges for mediators.

Explain the benefits and limitations of AI-Powered Tools and Functions in Mediation.

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m and revised contract terms. To resolve the matter
(iii) Giga Ltd, a mid-sized manufacturing company, is facing a dispute with one of its

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key suppliers over delayed payments

ag has appointed Zoya, a Company Secretary, to lead
amicably, the Board of Directors

the negotiation process with the supplier. As she prepares for the negotiation, Zoya

understands that a well-structured approach is crucial to achieving a mutually beneficial

outcome.

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Outline the key steps which Zoya should follow for preparation and conducting

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negotiation effectively.

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