Alternative Dispute Resolution In India: An Analysis

Alternative Dispute Resolution In India: An Analysis


This article is about settling your disputes outside the court which is known as the Alternative Dispute Resolution method which is less formal, less costly, and less time-consuming than ordinary court proceedings. In this article, we will deal with all types of alternative dispute resolution methods available to the people and we will also be dealing with the laws in India governing Alternative Dispute resolution and what are its advantages, this article will give you are overview of ADR methods.


It refers to the different ways of resolving your disputes without getting into trial in court, in ADR (Alternative Dispute Resolution) the parties can resolve their disputes without getting into litigation in court if the parties to the case agree to use an ADR process. Recently in the last few years, we have seen tremendous growth in the use of ADR by people in India, now more people prefer to get their disputes resolved through ADR because of the many benefits that is offers such as secrecy, less time consuming, and less costly.


Alternative dispute resolution refers to any method of resolving disputes outside of court. These processes are confidential, and less costly than the regular court proceedings.

Types of ADR

  1. Arbitration: In this, there is a third neutral person known as the ‘arbitrator’ he is the one who hears all the arguments from both sides of the parties to the case and also takes evidence from both parties and then he decides the case by passing ‘arbitral award’ in the arbitration proceedings the parties are bound to accept their decisions as final and there is generally no right to appeal given to parties, arbitration is less formal than the regular court proceedings. But in the case of non-binding arbitration, parties have a right to trial if they are not satisfied with the arbitrator’s decision. It is a quasi-judicial 
  2. proceedings.
  3. Mediation: In this, there is a third neutral person who is not a party to the case and helps both parties to try to reach a solution for their dispute that is mutually acceptable between both parties. The solution suggested by the mediator is not binding on the parties he just helps them to communicate so parties can try to resolve the disputes themselves. The whole process of mediation done by the mediator is with the parties’ consent. It is less formal than arbitration.
  1. Negotiation: In this type of ADR there is direct contact between the parties to the case and to arrive at the solution of the dispute must be acceptable between both parties to the dispute, both parties can give their views, interests, and solutions by having discussions on it. Negotiation can be done informally as well as with the help of a lawyer.
  1. Collaborative Law:  In this process, both the parties to the disputes along with their respective lawyers can agree to resolve the dispute without going to court by debating and negotiating and providing solutions to their disputes. It is similar to negotiation proceedings.
  1. Neutral Evaluation: In this type of ADR, there is an expert opinion taken by both the parties to the dispute and helps them to have a satisfactory agreement between the parties to the case known as a neutral evaluator who has authority about the topic which is on the disputes. The evaluator provides an opinion related to the evidence and arguments so that the dispute can be resolved. The decision of the evaluator is not binding upon the parties.

What types of disputes can be resolved through ADR:

ADR is preferably used in matters of civil disputes between individuals and organizations on topics such as


Employment-related matters,


consumer issues, housing, etc.

Benefits of ADR:

Less costly

Less time consuming

Less formal than regular court proceedings

More flexible

Secrecy of the dispute is maintained

Both parties get a satisfactory outcome or solution to the disput

Legislations governing ADR in India:

Following are some legislation passed in India governing ADR proceedings and securing the interests of the parties. 

  • Arbitration & Conciliation Act, 1996

Indian parliament passed the Arbitration & Conciliation Act,1996 to make arbitration proceedings more consistent and binding upon the parties to the disputes. 

Aim of the Arbitration & Conciliation Act, of 1996 are:

  • Less intervention of the court
  • Arbitral award must be enforced similarly to the decree of the court
  • It provides dispute settlement at a low cost
  • It is less time-consuming and it is set up to reduce the burden on the Judicial Bodies like regular courts of law.
  • To ensure that it is done in a just, fair, and effective manner 

This act also covers the enforcement of foreign awards and conciliation proceedings.

  • International Arbitration Centre Act, 2019

This act was passed so that there is an institution of national importance known as India International Arbitration Centre. It is a Centre for resolving domestic and international commercial arbitration. It provides facilities for conciliation, mediation and arbitral proceedings with certified arbitrators, mediators, and conciliators both at national and international levels.

  • The Mediation Act, 2023

Mediation refers to one of the modes of alternative dispute resolution which is more informal than arbitration and it tries to facilitate negotiations between both the parties to the dispute, thus mediation helps the disputant parties to preserve their relations as the settlement arrived is voluntary without any compulsion.

Alternative Dispute Resolution In India: An Analysis
Alternative Dispute Resolution In India: An Analysis

On 15-09-2023, the Ministry of Law and Justice notified the Mediation Act, of 2023 to promote institutional mediation for dispute resolution and enforce the mediated settlement agreements to make it a cost-effective and acceptable process. As per the act mediated agreements can be challenged on grounds like fraud, and corruption.

Case Laws:

Cheran Properties Ltd. V. Kasturi and Sons Ltd. & Ors.

In this case, it was held that the group of companies doctrine means that there is proper fulfillment of mutually held intent between the parties, where the circumstances clearly indicate that both signatories and non-signatories are bound by it because non signatory has assumed the obligation to be bound by the actions of the signatory.

Purushottam S/O Tulsiram Badwaik v. Anil & Ors. 

 In this case, it was held that if the arbitration agreement entered into subsequent to the passing of the 1996 Act refers to those provisions available under the Indian Arbitration Act or the 1940 Act, those rules shall have no effect and suit under the 1996 Act may be invoked has been used. Furthermore, the court found that a misrepresentation or misrepresentation as to the application of the 1940 Act would not invalidate the enforceability agreement as a whole.

        Oriental Insurance Company Limited v. M/S Narebheram Power & Steel Pvt. Ltd. 

         In this case Supreme Court held that The judgment must be interpreted strictly.    Each statement in the sentence must clearly express the intention to respect the statement.

NCC Ltd. V. Indian Oil Corporation Limited 

In this case court observed that sec 11(6A) which is inserted by Amendment Act,2015 has 

That The court significantly narrowed the test. It is limited to the existence of arbitration agreements, which apply to the existing dispute.


From the above article, we can see that ADR has been growing in the last few years but we can also see that it will be very important to our Indian judiciary system in the coming time. So our judicial system should also focus on ADR and develop it more effectively and efficiently. 


 Author: Vaishali Samadhia, A student at Amity University Madhya pradesh

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