NEW DELHI: On August 2, the government initiated a groundbreaking settlement scheme aimed at resolving contractual disputes with vendors or suppliers associated with the government and its undertakings. To participate, firms must submit their claims for consideration before the October 31 deadline.

The Finance Minister, Nirmala Sitharaman, announced the scheme, titled 'Vivad se Vishwas II - (Contractual Disputes),' in the current year's Union Budget. The Department of Expenditure had previously outlined the guidelines for its implementation through an order issued in late May.

In the Budget, Ms. Sitharaman stated, "To resolve contractual disputes between the government and government undertakings, where an arbitral award is contested in court, we are introducing a voluntary settlement scheme with standardized terms. This scheme will provide graded settlement options based on the level of pending disputes."

For a dispute to be eligible for settlement consideration, the aggrieved party must have obtained an arbitral award by January 31, 2023. The cut-off date for court orders is set at April 30.

The Finance Ministry clarified, "This scheme applies to all domestic contractual disputes where either the Government of India or an organization under its control is one of the parties involved."

Regarding settlement amounts for court awards, contractors will be offered up to 85% of the net amount awarded or upheld by the court. In the case of arbitral awards, the threshold for settlement will be "up to" 65% of the net amount.

The dedicated web-page for implementing this scheme has been developed by the Government e-Marketplace (GeM), and eligible claims will be processed solely through GeM. Contractors of the Ministry of Railways can register their claims on the Indian Railways E-Procurement System.

Mines and minerals amendment Bill passed in Rajya Sabha

Building 6,000 Transit Accommodations for Kashmiri Migrant Employees: Govt