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Alternative Dispute Resolution

ADR (alternative dispute resolution) resolves disagreements outside of the courtroom, unlike litigation, with a clear winner and loser.

Alternative Dispute Resolution typically denotes a broad range of dispute resolution processes that act as a means for disagreeing parties to argue without litigation. It is a way through which parties can settle disputes with the help of a third party. ADR helps ease the burden of litigation on courts while providing a well-rounded and satisfying experience to the parties involved. 

ADR offers to resolve all types of disputes, including civil, commercial, family, etc., where people cannot negotiate or settle. It is a method that enables individuals and groups to maintain social order cooperation and provides an opportunity to reduce hostility. 

Alternative Dispute Resolution in India 

Alternative Dispute Resolution has been around in India since the earlier Arbitration Act of 1940. Hence, it is not a new concept. The adoption of Section 89 of the Code of Civil Procedure, 1908, and, as a result, the Arbitration & Conciliation Act, 1996, was prompted by the urgent need to develop procedures to reduce the burden of courts and enable quick access to justice. 

The Act was passed to support the UNCITRAL Model’s mandates. Section 89(1) of CPC allows settling disputes outside the Court. In basic terms, it states that if the Court believes that some parameters may be acceptable to both parties, it may send the matter to arbitration, conciliation, or mediation for a possible resolution.

Important Provisions Related to ADR in India  

The acts which deal with Alternative Dispute Resolution are Arbitration and Conciliation Act 1996, and The Legal Service Authority Act, 1987. 

Types of ADR


  1. Arbitration cannot take place without a valid arbitration agreement in place before the occurrence of a dispute. 
  2. Parties refer their disputes to one or more persons, namely referred to as arbitrators, in this method of conflict settlement. The arbitrator’s decision is binding on the parties, and it is referred to as an ‘Award.’ 
  3. The goal of arbitration is to reach a fair settlement of a dispute outside the Court, saving time and money. 
  4. It should be emphasised that either party can nominate the arbitrator to the dispute. If the other party does not agree with the arbitrator, the party can request the arbitrator’s appointment from the Chief Justice. 
  5. The arbitrator’s decision is final and binding on both parties, and it is presented in the form of an award. 
  6. The arbitration tribunal has authority over its jurisdiction. As a result, if either party is dissatisfied with the arbitral award, section 34 of the Arbitration & Conciliation Act specifies certain grounds on which a party can seek to have the verdict set aside in the chief civil Court of original jurisdiction.


  1. Mediation is a type of Alternative Dispute Resolution in which a neutral third party uses dialogue and communication to assist conflicting parties in achieving a mutually acceptable agreement. 
  2. It is the most straightforward technique of dispute settlement, in which a third party works as a mediator to help the parties resolve their differences.
  3. The mediator just serves as a facilitator in obtaining a mutually acceptable agreement; the parties have entire authority over the mediation process. His/her recommendations or decisions bind neither of the parties.


  1. Conciliation is another alternative dispute resolution comparable to arbitration but less formal. 
  2. The parties to the dispute use a conciliator in this process, who meets with each party separately to find an agreeable conclusion. 
  3. The goal of seeing each side is to alleviate tension, improve communication, and interpret the conflict to reach a settlement.
  4. Conciliation differs from arbitration in that it does not require the parties to reach an agreement beforehand, and the conciliator’s recommendations are not binding on the parties.

Lok Adalat

  1. It is one of the alternative dispute resolution processes. It is a place where cases pending in Court or at the pre-litigation stage are settled cooperatively. The Legal Services Authorities Act of 1987 has given Lok Adalats a legal standing. 
  2. As per the aforementioned Act, any decision made by the Lok Adalats is considered a decree of a civil court judgement and is final and binding on all parties. 
  3. No appeal against such an award lies before any court of law.

Advantages of Alternative Dispute Resolution 

  1. Less time-consuming: Compared to courts, people resolve their disputes in a shorter amount of time.
  2. Cost-effective method: Going through the legal procedure saves a lot of money.
  3. No technicalities of the Court are required: All the disputes are resolved informally.
  4. Efficient method: Mending the relationship is always possible as parties discuss their difficulties on the same platform.
  5. People can freely express themselves without the fear of getting prosecuted by the Court. They can tell the truth without having to reveal it to a court.
  6. It avoids additional disagreement and maintains the parties’ positive relationship.


The origins of ADR methods can be traced back to establishing arbitration rules, which have evolved significantly over time. Other ADR processes began to knock on the door of the Indian Parliament throughout time, and the Parliament was wise enough to include these new dispute settlement approaches. The Commercial Courts Act of 2015 and the Micro, Small and Medium Enterprises Development Act of 2006, for example, ensure that these procedures are employed on a case-by-case basis in specific industries. 

The present-day Indian government is taking additional steps to develop ADR processes, intending to make India a global destination for arbitration and other forms of conflict settlement.


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