Alternative Dispute Resolution: An Asset India

Judiciary is one of the most important Branch of government. The main function of the judiciary is to punish the wrong doer.  In India, judiciary is said to be people’s savior. It is the only organ the people trust the most because it dispenses justice and acts as a neutral entity between the government and the people. Judiciary also has the power to declare a law made by the legislature as unconstitutional if it violates the basic structure of the constitution. This is termed as Judicial Review.

But in today’s time judiciary is completely strenuous because of the piles of cases pending in front of the courts. There are millions of cases pending in different courts of India many of which are pending from more than a decade.

There is another option for the people where they can settle their disputes mutually and that is termed as Alternative Dispute Resolution System. As the name suggests, it is a process of settling disputes without litigation. The purpose of law according to Gandhi was that the main function of a Lawyer was to unite the parties.  In his twenty years of practice he found out that both the parties to a dispute do not want a fathomless battle in court rather they want a solution for the same where both the parties gain profit. The main advantages of Alternative Dispute Resolution System over Litigation are The Court Queues, Rising Cost and Wastage of Time. Alternative Dispute Resolution is a win- win situation for both the parties as it resolves disputes between the parties without going to the court in less time and  also saves court time.

According to Abraham Lincoln it is rightly said that,“A Good settlement is better than a law suit”.


Dispute resolution process is not a new process rather an old non-judicial indigenous method to resolve dispute. Only the extensive promotion and accumulation of ADR model and wider use of it as a mean for settlement of a specific dispute is new.

ADR has been prevalent in India since time immoral. In the past, men had been experimenting to find a cheap and convenient method to get justice. In ancient times, there were several grades of arbitration like PUGA which was a board of people who belonged to a different sector and tribe but lived in same locality with SRENI or assemblies of tradesmen and artisan belonging to different tribes.[1]

Judicial administration was changed in British Period. Modern Arbitration Law in India was created by BENGAL REGULATION ACTS 1772 AND 1771 which provided  parties to submit their  dispute to an Arbitrator, who was appointed  by mutual agreement and whose decision would be binding on both the parties.

In 1996 Arbitration and Conciliation act was passed which was based on UNITED NATIONS INTERNATIONAL TRADE LAW (UNCITRAL) Model. Section 30 of this act encourages arbitrators with the agreement of the parties to use mediation, conciliation, negotiation or any other procedure to encourage settlement.



Arbitration is a technique which is used to resolve a dispute outside the court wherein both the party mutually Refer their case to an individual who is known as an Arbitrator. The decision of the Arbitrator is final and both the parties are bound to accept to it.


Conciliation is a technique where both the parties to a dispute use a conciliator. A Conciliator is a person who meets both the parties separately to resolve their dispute. It is a voluntary process in which parties are free to agree and resolve the dispute.


Mediation is a voluntary, informal, party centered and structured negotiation process. In this technique there is a neutral 3rd party who assists both the parties in resolving their disputes in a peaceful manner who is known as a Mediator. The Mediator only helps both the party to reach to settlement. He makes no decision on his own but only assists the parties.


LOK ADALAT is also known as people’s court. 1ST LOK ADALAT was held on 14th MARCH, at JUNAGARH in Gujarat 1982. It is established by the government on ground level to settle disputes through conciliation and compromise. They have been given statutory recognition under the Legal Services Authorities Act, 1987. There is no court fee for settling the matter in LOK ADALAT. If a matter pending in a court is settled in LOK ADALAT, then the fee is refunded to both the parties.


Section 89 of Code of Civil Procedure which is also known as judicial settlement gives power to a judge to refer any civil matter like family matters, matters relating to finance, business, insolvency etc for resolving disputes through arbitration, conciliation, mediation etc.

The judiciary is extensively promoting ADR and is trying to encourage people to solve their disputes by the process of ADR. This is clearly evident because in some courts, International Arbitration Centre is set up where people can resolve their disputes at ease.

Also Read – Arbitration And Its Scope



ADR is a time saving method compared to litigation. According to DAKSH Database, average pendency of any case in high court is 3 years & 1 month whereas if a case is pending in a subordinate court, average pendency is 6 years whereas in ADR, the dispute is settled in very less time


It is correctly said that ROAD TO JUSTICE IS A LONG AND EXPENSIVE ONE. Parties are charged hefty fees by lawyer who aims to earn money by extending the case rather than providing justice.  Whereas ADR is usually cheaper than litigation.


Arbitral proceedings are held behind closed doors and are not part of the public records. Arbitrator keeps all the information regarding the case confidential. Thus this makes this whole process private and confidential



If   an arbitrator has made a colossal mistake, it can sometimes result in an unfair decision because the decision of the arbitrator is binding on both the parties.


For most people having a jury is an important right which is not easily given up. ADR does away with jury by leaving the matter in the hand of an Arbitrator.


We know that ADR Proceedings is taken place privately rather than in a court, this may be considered as an advantage by some people but this lack of transparency can make this method impartial and problematic


Law commission of India in its 176TH Report amended the 1996 Arbitration and Conciliation Act which provided domestic arbitration between the Indian Nationals only. Therefore by this act, certain difficulties arose in implementation of the act. Thus law commission report made it’s recommendation for bringing amendment in Arbitration and Conciliation Act.

Law commission in its 221st Report which came in 2009 said that there is a need of speedy justice and suggested solutions for the same.

Law commission in 230TH & 240TH Report made certain amendments to section 35A[2], Section 95[3] ORDER XX RULE 6A[4], ORDER XXV[5] AND ORDER XLI[6].

Law commission in it’s 246TH REPORT which was submitted in August 2014 encouraged more people to settle their disputes through ADR since litigation in court is a time consuming and expensive process of getting justice.

In October 2015 present of India enunciated an ordinace to bring into force amendments recommended by law commission to Arbitration and Conciliation Act, 1996 & Arbitration and Conciliation Act 2015, which came into force on 23rd October 2015. These amendments were highly appreciated for providing growth to India’s arbitration regime and helped in development of helped in development of arbration regime.[7]


Oil and Natural Gas Commission v/s Collector of Central Excise and Customs (1992)[8]

In the above case, THE SUPREME COURT OF INDIA  clearly directed that in the public interest of saving public money and time, the dispute between Public Sector Undertaking and Government Departments must be settled by the process of arbitration.

Chief Conservator Of Forests V/S COLLECTOR AND OTHERS (2003)[9]

The judgment of the court was delivered by SYED SHAH MOHAMMED QADRI. In this case the court directed the central government to set up the committee from Ministry of Industry, Bureau of Public Enterprises and Ministry Of Law to monitor disputes themselves mutually and to ensure that the dispute does not come to the court or the tribunal.


From the above essay, I conclude that both the ADR and the government should work simultaneously because both are dependent on each other. Both judiciary and ADR play an important role in the development of each other. According to me, judiciary should continue to promote alternative dispute resolution system more because it eases the burden on court. India is a developing country and the Indian judiciary is one of the most powerful judiciary in the world and should continue to provide a platform to ADR. On the other hand, I also think that the arbitrators must be given proper training so they can settle the disputes easily. At last, I would like to say that alternative dispute resolution system is boon for the judiciary and has proved to be an asset for the whole country.


[2] Compensation for false litigation

[3] Compensation for arrest and attachment on insufficient ground

[4] Preparation of decree

[5] Security for cost

[6] Appeals from original decree


[8] 1995 Supp (4) SCC 541


This article is authored by Devansh Gulati, student of B.A. LL.B at Fairfield Institute of Management & Technology, New Delhi.

Also Read – Recent Amendments In The Arbitration Act

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