Initial Step: Mediation or Amicable Settlement

Most Purchase and Sale Agreements (PSAs) include a clause mandating that parties first attempt amicable settlement or mediation in the event of a dispute. This allows:

• Direct negotiation between buyer and seller through written notice
  
• A fixed period (usually 15 to 30 days) to resolve disputes without formal legal action
  
• Appointment of a mutually agreed mediator or advisory panel if necessary
  

This method helps preserve business relationships and avoid unnecessary delays or legal expenses.

Primary Mechanism: Arbitration

If mediation fails, the agreement typically provides for arbitration as the primary dispute resolution mechanism. Key features include:

• Resolution under the Arbitration and Conciliation Act, 1996 (India)
  
• Appointment of a sole arbitrator or a panel of arbitrators, mutually agreed or nominated through an institution
  
• Proceedings held in a specified location (e.g., Chennai, Mumbai, or New Delhi)
  
• Language of arbitration (usually English) and binding final award enforceable in court
  

Arbitration is preferred in commercial land deals for its confidentiality, speed, and enforceability.

Recourse: Litigation for Interim or Enforcement Relief

While arbitration is final for most disputes, the agreement may allow for litigation in specific cases, such as:

• Seeking interim injunctions or stay orders from civil courts
  
• Enforcing arbitral awards under the Code of Civil Procedure
  
• Filing suits for specific performance or breach of contract, if arbitration is waived or not applicable
  

The jurisdiction is typically specified in the PSA—for example, courts at the location of the property or transaction execution—to avoid ambiguity.

This tiered dispute resolution structure ensures fairness, flexibility, and legal protection for both parties.