The Government has proposed quick settlement of contractual disputes to promote ease of doing business as announced in the Union Budget 2023-24.
In this regard, the Ministry of Finance today circulated a draft scheme for consultation with stakeholders. The scheme is aimed at bringing quick finality to certain contractual disputes in which the government or its agencies is a litigant.
The scheme will apply to disputes where one of the parties is either the government or its other agencies. It will be applicable to all contractors or suppliers who wish to participate. In case Central Public Sector Enterprises are the contractors or suppliers in a particular contract, they are also eligible to submit their claims under the scheme.
The scheme will be implemented through Government e-Marketplace GeM, which will provide an online functionality for the same. The draft scheme document also provides a broad functionality that the GeM portal shall provide to implement the scheme.
The draft scheme also contains a draft settlement agreement between the litigating parties to bring finality to the contractual dispute settlement.