ARBITRATION

Arbitration is a dispute resolution mechanism wherein parties agree to have their conflict decided by
an impartial third party, referred to as an arbitrator. The legal framework governing arbitration in India
is provided by the Arbitration and Conciliation Act 1996, which came into effect on January 25, 1996.
This Act encompasses provisions for domestic arbitration, international commercial arbitration, and
enforcing foreign arbitral awards. It aligns with the UNCITRAL Model Law, ensuring consistency
with the standards adopted by the United Nations Commission on International Trade Law
(UNCITRAL). The Arbitration and Conciliation Act 1996 was enacted to consolidate the legal
framework governing domestic arbitration, international commercial arbitration, the
enforcement of foreign arbitral awards, and conciliation procedures.
The primary objectives of the Act are as follows:
1. To establish a comprehensive legal framework for international and domestic arbitration and
conciliation.
2. To ensure that arbitration proceedings are conducted in a just, fair, and efficient manner.
3. To mandate that arbitral tribunals provide reasoned awards, ensuring transparency and
accountability.
4. To ensure arbitral tribunals act within their defined jurisdiction.
5. To empower arbitral tribunals to employ alternative methods, such as mediation and
conciliation, during arbitration proceedings.
6. To minimize judicial intervention in arbitration, thereby reducing the supervisory role of
courts.
7. To ensure arbitral awards are enforceable as if they were court decrees.
8. To allow the outcome of conciliation proceedings to be treated as an arbitral award on agreed
terms.
9. To recognize and enforce foreign arbitral awards following the international conventions
India is a party to.
These provisions promote arbitration as an effective, efficient, and reliable mechanism for resolving
domestic and international disputes.
Scheme Of The Arbitration And Conciliation Act, 1996
Part I (Sections 2-43) – Applies to the place of arbitration in India. The award granted is treated as a
domestic award.
Part II (Sections 44-60) – Enforcement of foreign awards.
Part III (Sections 61-81) – Conciliation
Part IV (Sections 82-86) – Supplementary provisions
Essential definitions under the Arbitration and Conciliation Act.
Section 2(1)(a) defines "arbitration" as any arbitration, whether or not administered by a permanent
arbitral institution.
Section 2(1)(b) defines‘’ arbitration agreement’’ as an agreement referred to in section 7.
Types of Arbitration
1. DomesticArbitration: Arbitration is conducted following Indian laws and is subject to Indian
jurisdiction.
2. InternationalCommercialArbitration: Arbitration arises from disputes in legal relationships
where at least one party is a foreign national, a corporate entity incorporated in another
country, an entity controlled by a foreign government, or a foreign state itself.
3. InstitutionaLArbitration: Arbitration is administered by established arbitral institutions,
such as the Indian Council of Arbitration or the International Centre for Alternative Dispute
Resolution (ICADR).
4. AdHoc=Arbitration: Arbitration is where the parties independently agree on the arbitration
process without involving an arbitral institution.
5. Fast-Track=Arbitration:Also referred to as documentary arbitration, this method is
expedited and time-efficient. It relies solely on the submission of written statements,
including claims and replies, by the parties.
6. Flip-Flop=Arbitration: Also known as pendulum arbitration, this process involves parties
presenting their respective cases and inviting the arbitrator to make a binding decision by
choosing one of the two proposed options.
Arbitration Agreement - S.7
1. Definition: An arbitration agreement refers to an arrangement between parties to submit to
arbitration any or specific disputes that have arisen or may arise between them concerning a
defined legal relationship, whether contractual or otherwise.
2. Form:
An arbitration agreement can be:
o Included as a clause within a contract, or

o Constituted as a separate standalone agreement.

3. Requirement of Writing:
An arbitration agreement must be documented in writing.
4. Modes of Written Agreement:
An arbitration agreement is considered to be in writing if it is:
(a) Containe in a document signed by both parties.
(b) Established through an exchange of letters, telex, telegrams, or other forms of
telecommunication, including electronic communications, that provide a clear record of the
agreement.
(c) Evidenced by an exchange of statements of claim and defense, one party asserts an
arbitration agreement’s existence and the other does not deny it.
5. Reference to Arbitration Clause in Other Documents: A reference in a written contract to a
separate document containing an arbitration clause will constitute a valid arbitration
agreement if the reference is sufficiently explicit to incorporate the arbitration clause into the
contract.
Essential Elements of a Valid Arbitration Agreement
 1. Consensus Ad Idem:A valid arbitration agreement requires that all parties are in mutual
agreement (consensus ad idem) regarding the submission of disputes to arbitration. This
means all parties must have an unequivocal intention to resolve disputes through arbitration
rather than conventional litigation.
2. Scope of Dispute:The arbitration agreement must clearly define the scope of disputes that can
be referred to arbitration. It should specify whether it covers all disputes arising from the legal
relationship or only specific disputes. This ensures clarity and avoids ambiguity during
arbitration proceedings.
3. Arbitration Clause:A valid arbitration agreement may exist as a standalone agreement or as
an arbitration clause embedded within a broader contract. The clause should be drafted
precisely, leaving no room for uncertainty about the parties' intention to arbitrate disputes.
4. Writing Requirement: To be enforceable, the arbitration agreement must be in writing. This
can be in a signed document, an exchange of correspondence, or even through electronic
communication, provided it evidences the parties' intent and agreement to arbitrate. This
requirement aligns with Section 7 of the Arbitration and Conciliation Act 1996.
5. Arbitral Tribunal: The agreement should allow the parties to decide on:
o Number of Arbitrators: Parties can mutually agree on the number of arbitrators,
typically one or three, to ensure an unbiased and fair decision-making process.
o Appointment Procedure: The procedure for appointing arbitrators must be outlined,
providing a framework for resolving disputes regarding the appointment.
o Procedure for Arbitration: The agreement should also detail the procedural rules to
be followed during arbitration, including timelines, evidence submission, and conduct
of hearings.
6. Legal Capacity: All parties entering the arbitration agreement must possess the legal capacity
to do so. For example, minors and individuals lacking legal capacity under the Indian
Contract Act 1872 cannot enter into a valid arbitration agreement. Any agreement entered into
by such persons would be deemed void.
7. Governing Law and Seat of Arbitration: The arbitration agreement must specify the
governing law regulating the arbitration process, ensuring legal certainty. Additionally, the
agreement should indicate the seat (legal jurisdiction) of arbitration, as this determines
procedural rules, judicial oversight, and enforcement mechanisms applicable to the arbitration
process.
P. Anand Gajapati Raju v. P.V.G. Raju (2000)
This case established key conditions under which arbitration proceedings can be initiated in alignment
with the Arbitration and Conciliation Act, 1996 provisions. The following essential requirements were
emphasized:
1. Existence of an Arbitration Agreement: A valid arbitration agreement must exist between
the parties, outlining their intention to resolve disputes through arbitration.
2. Commencement of Legal Action: One party must initiate legal proceedings in a court
against the other party, thereby bringing the matter to judicial notice.
3. Identical Subject Matter: The dispute brought before the court must correspond to the
subject matter specified in the arbitration agreement.
 4. Invocation of Arbitration: At least one party must assert its right to arbitration by formally
requesting or demanding arbitration within the court proceedings.
National Agricultural Co-operative Marketing Federation of India Ltd. v. Gains Trading Ltd.
(2007)
In this case, the plaintiff, National Agricultural Co-operative Marketing Federation of India Ltd.,
entered into a contractual agreement with the defendant, Gains Trading Ltd., under which the
defendant agreed to purchase a specified quantity of the plaintiff's products. However, the defendant
failed to deliver the goods, resulting in financial losses for the plaintiff. When the plaintiff sought
compensation, the defendant refused to pay, prompting the initiation of legal proceedings.
The contract between the parties included an arbitration clause stipulating that any disputes arising
under the agreement would be resolved through arbitration.
Issue Before the Court
A critical issue in the case was whether the arbitration clause within the contract would remain
enforceable if the contract itself was repudiated or terminated.
Judgment of the Supreme Court
The Supreme Court held that an arbitration clause is a collateral provision concerned with the
resolution of disputes and is distinct from the substantive terms of the contract regarding performance.
The Court observed that even if the main contract is repudiated, terminated, or declared void, the
arbitration clause continues to survive and remains enforceable for resolving disputes arising out of or
connected to the primary agreement.
Power to Refer Parties to Arbitration Under an Arbitration Agreement - S.8
1. Referral to Arbitration: A judicial authority, when presented with a dispute that is subject to
an arbitration agreement, must refer the parties to arbitration upon the request of a party to the
agreement or any individual claiming through or under such a party. This request must be
made no later than the submission of the first statement on the substance of the dispute. Such
referral is mandatory unless the court determines, on a prima facie basis, that no valid
arbitration agreement exists, notwithstanding any prior judgment, decree, or order from the
Supreme Court or any other court.
2. Filing Requirements: The application requesting referral to arbitration must be accompanied
by the original arbitration agreement or a duly certified copy.
o Exception: If the requesting party does not possess the original agreement or a
certified copy, as it is retained by the other party, they may file the application along
with a copy of the arbitration agreement and a petition asking the court to direct the
opposing party to produce the original or a certified copy.
3. Continuation of Arbitration Proceedings: Even if an application under sub-section (1) is
pending before the judicial authority, the arbitration process may still be initiated or
continued, and the arbitral award may be rendered without interruption.
Non-Arbitrable Disputes
The following categories of disputes are generally deemed non-arbitrable due to their public interest
implications or exclusive jurisdiction under specific statutory frameworks:
1. Industrial Disputes: Issues governed by labor and industrial laws fall outside the scope of
arbitration.
 2. Revenue Matters: Disputes concerning taxation, duties, or other fiscal liabilities managed by
the state are non-arbitrable.
3. Criminal Proceedings: Matters involving criminal offenses and penalties are inherently non-
arbitrable as they pertain to public law and order.
4. Guardianship and Wardship: Cases involving the determination of guardianship or custody
of minors fall under the exclusive jurisdiction of family or guardianship courts.
5. Testamentary Matters: Issues concerning wills, succession, or inheritance under the Indian
Succession Act are non-arbitrable.
6. Trust and Charity Disputes: Matters relating to trusteeship, administration of public or
charitable trusts, and other issues governed by the Indian Trusts Act or relevant laws on public
charities are excluded from arbitration.
7. Competition and Trade Practices: Disputes under the Restrictive Trade Practices Act,
Monopolies Act, or other competition-related statutes are reserved for specialized tribunals or
courts.
8. Corporate Law Issues: Matters involving insolvency, dissolution, or winding up of
companies under the Companies Act are non-arbitrable and fall under the exclusive purview
of company law tribunals.
9. Eviction and Tenancy: Disputes concerning eviction or tenancy governed by special tenancy
laws or statutes are adjudicated exclusively by designated rent control or tenancy courts.
These matters are excluded from arbitration as they involve public rights, statutory interpretation, or
specialized adjudicatory mechanisms.
In the landmark case of Booz Allen & Hamilton Inc. v. SBI Home Finance Ltd. (2011), the Supreme
Court clarified the non-arbitrability of certain disputes. Specifically, the Court held that eviction or
tenancy matters governed by special statutes, where tenants are granted statutory protections, fall
exclusively under the jurisdiction of designated courts.
The Court also established a key distinction regarding arbitrability based on the nature of the rights
involved. It held that rights in rem, which are enforceable against the world (such as those in
testamentary matters), are not arbitrable. Conversely, rights in personam, which pertain to specific
individuals and their private obligations (e.g., rights under a patent license), can be arbitrated.
The Court further emphasized that while disputes involving enforcing private rights under a patent
license may be arbitrated, questions about the validity of the underlying patent and rights in rem
cannot be submitted to arbitration. This principle became the cornerstone for determining the
arbitrability of disputes in India, offering clear guidance on the scope and limits of arbitration.
Appointment of Arbitrators - S.11
1. Eligibility to Act as Arbitrator Any individual, irrespective of nationality, can be an
arbitrators unless the parties agree otherwise.
2. Procedure for Appointment Parties can mutually decide on a procedure for appointing
arbitrators, subject to certain limitations under the Act. In cases where no agreement is
reached, specific rules apply:
o For arbitration involving three arbitrators, each party must appoint one arbitrator, and
the two appointed arbitrators must jointly select the third arbitrator, who will serve as
the presiding arbitrator.
 o If either party fails to appoint an arbitrator within 30 days of receiving a request, or if
the two appointed arbitrators cannot agree on the third arbitrator within 30 days of
their appointment, the Supreme Court, High Court, or a designated institution may
step in to make the necessary appointment upon request.
3. Sole Arbitrator : In cases requiring a sole arbitrator, if the parties fail to reach an agreement
within 30 days of one party's request, the Supreme Court, High Court, or a designated
authority may appoint the arbitrator upon application.
4. Default in Appointment Procedure: If the agreed appointment procedure fails due to any of
the following reasons:
o A party neglects to act as required under the procedure.

o Parties or arbitrators fail to reach an expected agreement.

o An individual or institution designated under the procedure does not perform their
assigned role.
A party may request the Supreme Court, High Court, or a designated institution to
take necessary action unless the procedure provides an alternative remedy.
5. Judicial Oversight Limited to Existence of Arbitration Agreement
While considering applications for appointment, the Court will examine the existence of a
valid arbitration agreement and not delve into the merits of the dispute.
6. Qualification and Impartiality
Before appointing an arbitrator, the Court or designated authority will ensure that the
individual satisfies any qualifications specified in the arbitration agreement and demonstrates
impartiality and independence, as disclosed under Section 12(1) of the Act.
7. International Commercial Arbitration
For international commercial arbitrations, the Supreme Court or its designate may appoint an
arbitrator of a nationality different from that of the disputing parties, where the parties are of
various nationalities.
8. Finality of Decision
Decisions made by the Supreme Court, High Court, or designated authority concerning the
appointment of arbitrators are final and not subject to appeal.
9. Timely Disposal
Applications for the appointment of arbitrators must be resolved expeditiously, with an effort
to conclude the process within 60 days from the date the opposite party is served notice.
10. Fee Determination
For non-international arbitrations, the High Court may establish rules for determining
arbitrators’ fees in line with the Fourth Schedule, unless the parties have pre-agreed to follow
an institutional framework for fee determination.
Grounds for Challenge - S.12
1. Mandatory Disclosure Requirements:: When a person is approached regarding their
potential appointment as an arbitrator, they are obligated to disclose in writing any
circumstances that may affect their impartiality or independence. These include:
(a) Any direct or indirect past or present relationship or interest, whether financial, business,
professional, or otherwise, with any party or in relation to the subject matter of the dispute,
that could give rise to justifiable doubts about their independence or impartiality.
 (b) Any factors that might hinder their ability to dedicate sufficient time to the arbitration
proceedings, particularly their capacity to complete the arbitration within the stipulated period
of twelve months.
Explanation 1: The grounds mentioned in the Fifth Schedule shall serve as a guide to
ascertain whether circumstances exist that could raise reasonable doubts regarding the
arbitrator’s independence or impartiality.
Explanation 2: The disclosure must be made using the form specified in the Sixth Schedule.
2. Grounds for Challenging an Arbitrator:An arbitrator may be challenged only under the
following circumstances:
(a) If there exist conditions that raise justifiable doubts about their independence or
impartiality.
(b) If they do not meet the qualifications agreed upon by the parties involved.
3. Restrictions on Challenges by Parties: A party may challenge an arbitrator whom they
appointed, or in whose appointment they participated, only if they become aware of the
grounds for such a challenge after the arbitrator's appointment.
4. Ineligibility Due to Conflict of Interest: Irrespective of any prior agreement, an individual
shall be ineligible to serve as an arbitrator if their relationship with any party, counsel, or the
subject matter of the dispute falls under the categories specified in the Seventh Schedule.
However, after the dispute arises, the parties may expressly agree in writing to waive the
application of this restriction.
Procedure for Challenge of Procedure - S.13
1. Freedom to Agree on Procedure: Subject to the provisions of sub-section (4), the parties are
at liberty to mutually agree on the procedure for challenging an arbitrator.
2. Procedure in the Absence of Agreement: In the absence of any agreement as provided in
sub-section (1), a party intending to challenge an arbitrator must submit a written statement
outlining the reasons for the challenge. This must be done within fifteen days of either:
(a) Becoming aware of the constitution of the arbitral tribunal, or
(b) Becoming aware of any circumstances specified in sub-section (3) of Section 12 that
warrant such a challenge.
3. Decision on Challenge by the Tribunal:
If the challenged arbitrator does not voluntarily withdraw from their office, and the opposing
party does not consent to the challenge, the arbitral tribunal itself shall decide on the
challenge.
4. Continuation of Proceedings if Challenge Fails: If a challenge is unsuccessful—whether
under a procedure agreed upon by the parties or the procedure outlined in sub-section (2)—
the arbitral tribunal will proceed with the arbitration and render an arbitral award.
5. Application to Set Aside the Award: After an arbitral award is made under sub-section (4),
the party challenging the arbitrator has the right to apply for setting aside the award under
Section 34.
6. Court’s Decision on Arbitrator’s Fees: If the arbitral award is set aside upon an application
made under sub-section (5), the Court may determine whether the challenged arbitrator is
entitled to receive any fees for their services.
Competence of Arbitral Tribunal to Rule on Its Jurisdiction - S.16
(1) The arbitral tribunal has the authority to determine its own jurisdiction, including addressing
objections regarding the existence or validity of the arbitration agreement. For this purpose:
(a) An arbitration clause within a contract shall be considered an agreement independent of the other
terms of the contract.
(b) If the arbitral tribunal declares the contract null and void, such a decision shall not automatically
invalidate the arbitration clause.
(2) Any objection to the jurisdiction of the arbitral tribunal must be raised no later than the submission
of the statement of defence. However, a party is not barred from raising such an objection solely on
the ground that they participated in the appointment of an arbitrator or were involved in the process.
(3) If a party believes that the arbitral tribunal is exceeding its scope of authority, such an objection
must be raised promptly, as soon as the issue in question arises during the arbitral proceedings.
(4) Notwithstanding the above timelines, the arbitral tribunal has the discretion to admit delayed
objections if it deems the delay to be justified.
(5) When the arbitral tribunal rules on an objection under sub-section (2) or (3) and decides to reject
it, the tribunal shall continue with the arbitral proceedings and render an arbitral award.
(6) If a party is dissatisfied with such an arbitral award, they may file an application to set it aside in
accordance with the provisions of Section 34 of the Act.
In Olympus Superstructures Pvt. Ltd. v. Vijay Khetan & Ors., the Supreme Court held that under
Section 16(1) of the Arbitration and Conciliation Act, 1996, the arbitral tribunal is vested with the
authority to decide matters pertaining to its own jurisdiction.
Section 16 of the Arbitration and Conciliation Act, 1996, empowers the arbitral tribunal to adjudicate
objections raised by either party concerning the existence or validity of the arbitration agreement or
clause. This authority of the tribunal to determine its own jurisdiction embodies the Principle of
Kompetenz-Kompetenz or the Principle of Competence.
The Principle of Kompetenz-Kompetenz is founded on three key aspects:
1. The arbitral tribunal has the primary authority to rule on its own jurisdiction, limiting the
interference of courts.
2. Any objection to the jurisdiction of the tribunal must first be addressed by the tribunal itself
before being referred to a court.
3. The scope of court intervention, if necessary, should be restricted to ascertaining the existence
of a valid arbitration agreement and facilitating the referral of the parties to arbitration.
In Bhushan Steel Ltd. v. Singapore International Arbitration Centre, relying on the precedent set in
the Roshan Lal Guptacase, the court held that once the existence of a valid arbitration agreement is
established, a suit seeking a declaration that the arbitral tribunal lacks jurisdiction or seeking a
permanent injunction to restrain arbitration is not maintainable.
The issue of arbitrability may be raised at three distinct stages:
1. Before the court: At the stage of reference to arbitration under Section 8 or during the
appointment of an arbitrator under Section 11 of the Arbitration Act.
2. Before the arbitral tribunal: During the course of the arbitral proceedings.
3. Before the court: At the stage of challenging the arbitral award under Sections 34 or 48 of
the Arbitration Act.
Section 18 states that All parties involved must be accorded fair and equal treatment, ensuring that
each is granted a reasonable and full opportunity to present their arguments and evidence.
19. Determination of rules of procedure.
The arbitral tribunal is not constrained by the procedural framework of the Code of Civil Procedure,
1908, or the evidentiary rules prescribed by the Indian Evidence Act, 1872.
Within the boundaries of this statutory framework, the parties have the autonomy to mutually decide
the procedural rules governing the arbitral proceedings.
In the absence of such an agreement, the arbitral tribunal retains the discretion to determine the
procedure for conducting the proceedings, provided it adheres to the overarching legal framework.
This discretionary power includes the authority to assess and decide on the admissibility, relevance,
significance, and evidentiary value of any material presented.
Section 20. Place of arbitration.
The parties have the liberty to mutually decide the venue for arbitration.
In the absence of such an agreement, the arbitral tribunal will determine the venue, taking into
account the specific circumstances of the case and the convenience of the parties involved.
Regardless of the agreed or determined venue, the arbitral tribunal, unless otherwise restricted by the
parties, may convene at any location it deems suitable for member consultations, witness or expert
examinations, party hearings, or the inspection of documents, goods, or other relevant property.
Bhatia Trading v. Bulk Trading SA
In a contract between the Appellant and the Respondent, the arbitration clause stipulated proceedings
under the ICC Rules in Paris, France, with a sole arbitrator. The Respondent sought an injunction
from the District Court of Indore to prevent the Appellant from alienating its property, which was
upheld by the High Court. The Appellant challenged this, arguing that Part I of the Arbitration and
Conciliation Act, 1996, did not apply to arbitrations seated outside India.
Key Principles:
1. Applicability of Part I:
o Part I applies to arbitrations in India.

o For foreign-seated arbitrations, Part I applies unless expressly or impliedly excluded.

2. Supreme Court Ruling:

The Court held that Part I applies to arbitrations outside India unless excluded. This allowed
Indian courts to grant interim relief (e.g., injunctions) under Section 9. However, this
interpretation extended Part I's provisions, enabling Indian courts to appoint arbitrators, grant
interim relief, and set aside foreign-seated awards.
Drawbacks:
 Misinterpretation of 'Seat' and 'Venue': The judgment conflated the arbitration's legal seat
with its venue, potentially overextending Indian arbitration laws.
 Overreach: This broad applicability risked undermining party autonomy and interfering with
foreign-seated arbitrations.
  Delays: Indian court intervention often caused significant delays, affecting the efficiency and
enforceability of arbitration proceedings.
The English Courts in Roger Shashoua v. Mukesh Sharma formulated the Shashoua Test to determine
the seat of arbitration. According to this test, if a “venue” is expressly designated in an agreement, and
there is no mention of an alternative “seat” or any significant contrary indication, the designated
venue is presumed to be the juridical seat of arbitration.
The Supreme Court in BALCO v. Kaiser Aluminium Technical Services Inc. adopted the Shashoua
Test and clarified that the “seat” is the legal situs of arbitration, determining the applicable curial law
and the supervisory court. In contrast, the “venue” is merely the geographical location for conducting
proceedings. When an agreement specifies a “venue” but not a “seat,” the venue is presumed to be the
seat unless contrary indications exist. Additionally, jurisdiction lies concurrently with the court where
the seat is located and the court where the cause of action arose.
Section 21 states that an Arbitral proceedings for a specific dispute are deemed to commence on the
date the respondent receives a request for the dispute to be referred to arbitration, unless the parties
have agreed otherwise.
Section 22 talks about Language of Arbitral Proceedings. Which further states that The parties
involved in the arbitration are permitted to mutually agree upon the language or languages that will be
utilized during the arbitral proceedings.
(2) In the absence of such an agreement, the arbitral tribunal shall determine the appropriate language
or languages for the proceedings.
(3) Unless otherwise specified, the agreed-upon or tribunal-determined language shall apply to all
written submissions by the parties, any hearings conducted, and any arbitral awards, decisions, or
other communications issued by the tribunal.
(4) The arbitral tribunal may require that any documentary evidence submitted be accompanied by a
translation into the language or languages agreed upon by the parties or determined by the tribunal.
Section 23 states about Statements of Claim and Defense meaning Within the timeframe agreed upon
by the parties or established by the arbitral tribunal, the claimant is required to present a statement
detailing the facts supporting their claim, the issues at hand, and the relief or remedy sought. The
respondent must similarly provide a defense addressing these particulars, unless the parties have
reached a different agreement regarding the necessary components of these statements.
(2) The parties may attach all relevant documents to their statements or reference additional
documents and evidence they intend to submit.
(2A) The respondent may also submit a counterclaim or assert a set-off in support of their case, which
shall be considered by the arbitral tribunal, provided that such counterclaim or set-off falls within the
scope of the arbitration agreement.
Unless the parties have reached a different agreement, either party has the right to modify or add to
their claim or defense during the arbitration process. However, the arbitral tribunal may refuse such
amendments if it deems them inappropriate due to the timing of the request.
Additionally, all statements of claim and defense must be finalized within six months from the date on
which the arbitrator or all arbitrators receive written notice of their appointment.
Section 24 states that The arbitral tribunal, unless the parties agree otherwise, has the authority to
decide whether to conduct oral hearings for presenting evidence or arguments, or to proceed based
solely on documents and other materials. However, if a party requests an oral hearing, the tribunal is
required to hold one at an appropriate stage of the proceedings, unless both parties have agreed to
forgo oral hearings.
Furthermore, the tribunal is encouraged to conduct oral hearings on a daily basis for presenting
evidence or arguments and should limit adjournments unless there is a compelling reason. If a party
seeks an adjournment without sufficient cause, the tribunal may impose costs, including exemplary
costs.
The parties must receive adequate notice in advance of any hearing or meeting of the tribunal that
involves inspecting documents, goods, or other property.
Additionally, any statements, documents, or applications submitted by one party to the tribunal must
be communicated to the other party. Any expert reports or evidentiary documents that the tribunal
relies upon in making its decisions must also be shared with both parties.
Section 31 states the following forms and contents of Arbitral Award:
1. An arbitral award must be documented in writing and signed by the members of the arbitral
tribunal.
2. In cases where there is more than one arbitrator, the signatures of the majority of the tribunal
members are sufficient, provided that the reason for any missing signature is clearly stated.
3. The award must include the reasons for its decision, unless:
 The parties have mutually agreed that no reasons need to be provided, or
 The award is based on agreed terms as outlined in section 30.
4. The award must specify the date it was issued and the location of the arbitration, as
determined according to section 20. The award will be considered to have been made at that
location.
5. Once the award is finalized, a signed copy must be delivered to each party involved.
6. The arbitral tribunal has the authority to issue interim awards on any matters during the
arbitration process that could also be addressed in a final award.
7. Unless the parties agree otherwise, if an arbitral award involves a monetary payment, the
tribunal may include interest in the awarded sum at a rate it deems reasonable. This interest
can apply to all or part of the amount due from the date the cause of action arose until the date
of the award.
 Additionally, unless specified otherwise in the award, any sum directed to be paid
will accrue interest at a rate two percent higher than the prevailing interest rate on the
date of the award, from the date of the award until payment is made.
 For clarification, "current rate of interest" refers to the definition provided in clause
(b) of section 2 of the Interest Act, 1978.
8. The costs associated with arbitration will be determined by the arbitral tribunal in accordance
with section 31A.
 For this purpose, "costs" includes reasonable expenses related to:The fees and
expenses of arbitrators and witnesses,Legal fees and expenses,Any administrative
fees charged by the institution overseeing the arbitration, andAny other expenses
incurred in connection with the arbitration proceedings and the resulting award.
Section 32 states about the termination of Arbitral Proceedings
1. Arbitral proceedings are concluded either by the issuance of a final arbitral award or by an
order from the arbitral tribunal as outlined in subsection (2).
2. The arbitral tribunal is required to issue an order to terminate the proceedings under the
following circumstances:
 (a) If the claimant withdraws their claim, unless the respondent objects to this
withdrawal and the tribunal acknowledges that the respondent has a legitimate
interest in achieving a final resolution of the dispute.
 (b) If both parties mutually agree to terminate the proceedings.
 (c) If the tribunal determines that continuing the proceedings has become unnecessary
or impossible for any other reason.
3. Subject to section 33 and subsection (4) of section 34, the authority of the arbitral tribunal
will end upon the termination of the arbitral proceedings.

Section 34 of the Arbitration and Conciliation Act outlines the procedures and grounds for challenging
an arbitral award. A party must file a challenge within three months from the date of receiving the
award, with a possible extension of an additional 30 days if sufficient cause for the delay is
demonstrated. Once this period has elapsed, the award holder can seek to enforce the arbitral award as
a court decree, but enforcement is not permitted until the challenge period has expired.
According to Section 34(3), an application to set aside an award must be submitted within three
months from its receipt. The Supreme Court clarified in Dakshin Haryana Bijli Vitran Nigam Ltd v.
Navigant Tech. Pvt. Ltd. that this limitation period begins when a signed copy of the award is received
by the parties.
In Noy Vallesina Engineering SpA v. Jindal Drugs Ltd. & Ors., the Supreme Court reaffirmed that
Section 34 proceedings cannot be used to challenge foreign awards; objections to such awards must
be raised under Part II of the Act.
The Supreme Court also distinguished between misinterpretation of contract terms and failure to
comply with contract obligations in Indian Oil Corpn. Ltd. v. Shree Ganesh Petroleum. The Court
ruled that erroneous interpretations do not constitute grounds for setting aside an arbitral award, while
non-compliance could lead to annulment under public policy.
In NHAI v. M. Hakeem, it was held that Section 34 does not empower courts to modify arbitral
awards; they may only uphold or annul them. This decision supports the principle of minimal judicial
interference in arbitration.
The Supreme Court provided further guidance on what constitutes 'public policy' in Associate
Builders v. Delhi Development Authority. It stated that an award based on no evidence or one that
disregards crucial evidence would be considered perverse and contrary to fundamental legal
principles, thus violating public policy.
An arbitral award lacking acceptable reasoning or justification may shock judicial conscience and be
denied enforcement. Additionally, any decision made contrary to established judicial principles would
also breach public policy as defined under Indian law.
Section 36 states about the enforcement of arbitral award as Once the time limit for challenging an
arbitral award under Section 34 has lapsed, the award can be enforced in accordance with the Code of
Civil Procedure, 1908, as if it were a court decree.
If a challenge to the arbitral award has been filed under Section 34, this does not automatically render
the award unenforceable unless the court issues a stay order on a separate application. When such an
application for a stay is submitted, the court may grant a stay of the award's operation, subject to
conditions it deems appropriate and must provide written reasons for its decision.
In cases involving monetary awards, the court will consider the provisions for granting a stay of a
money decree as outlined in the Code of Civil Procedure. If the court finds a prima facie case
indicating that the arbitration agreement or the award itself was obtained through fraud or corruption,
it will unconditionally stay the award while the challenge is resolved.
Section 37 specifies the orders from which appeals can be made. Appeals are permitted from:
 Orders refusing to refer parties to arbitration under Section 8.
 Orders granting or denying interim measures under Section 9.
 Orders setting aside or refusing to set aside an arbitral award under Section 34.
Additionally, appeals can be made against decisions of the arbitral tribunal that accept pleas under
Sections 16(2) or (3) or that grant or deny interim measures under Section 17.
No second appeal is allowed from an order made in appeal under this section; however, this does not
affect the right to appeal to the Supreme Court.
Section 43 states about the limitation of enforcement of arbitral award as The Supreme Court has
determined that arbitral awards are regarded as decrees for the purpose of enforcement. Consequently,
the provisions of the Limitation Act, 1963 apply to arbitration, establishing a limitation period of 12
years for enforcing domestic awards, which aligns with the limitation period for executing any decree.
In contrast, the Supreme Court has ruled that the limitation period for enforcing a foreign award is set
at 3 years, as specified under Article 137 of the Limitation Act. This period begins when the right to
seek enforcement of the foreign award arises.
Execution and enforcement of foreign awards:
To execute a foreign arbitral award, the successful party must submit a single application to the court
of competent jurisdiction for enforcement. If the court determines that the award is enforceable, it can
be executed in the same manner as a court decree, as stipulated by the Arbitration and Conciliation
Act, 1996. This Act specifies that every final arbitral award shall be enforced like a court decree, with
the execution process governed by Order 21 of the Code of Civil Procedure, 1908.
According to Section 44 of the Arbitration Act, a foreign award is defined as one issued in a country
that is a signatory to either the New York Convention or the Geneva Convention. The Government of
India has issued notifications declaring certain countries as territories to which these conventions
apply.
Section 47 outlines that any application for enforcing a foreign award must be accompanied by:
 The original award or an authenticated copy.
 The original arbitration agreement or a certified copy.
  Evidence proving that the award is foreign in nature.
If the award is in the local language of the issuing country, an English translation verified by
the consulate must also be included.
SECTION 47 - Foreign awards that are enforceable under the relevant legal framework are considered
binding for all purposes on the parties involved. This means that any party to the award can rely on it
in legal proceedings in India, whether as a defense, set-off, or for any other purpose. References to
enforcing a foreign award in this context also include references to relying on the award itself.
Section 48 specifies conditions under which enforcement of a foreign award may be denied. These
include situations where:
 The arbitration agreement was not valid under the applicable law.
 One party was not given proper notice regarding the appointment of the arbitrator or
arbitration proceedings.
 The subject matter of the dispute is not arbitrable under Indian law.
 Enforcement would contravene public policy in India.
If none of these conditions apply, the court will order the execution of the award.
SECTTION 49- When the court is satisfied that a foreign award is enforceable, it will be treated as a
decree of that court. This recognition allows the award to be executed in the same manner as a
domestic court decree, ensuring that international arbitral decisions are given equal standing within
the Indian legal system.
INTERIM MEASURE : Interim measures in arbitration are crucial for safeguarding the rights of
parties, particularly when one party may attempt to delay proceedings to disadvantage the other. Such
tactics can undermine the effectiveness of a final arbitral award unless the arbitral tribunal or the court
intervenes to protect the aggrieved party's rights before, during, and after the arbitration process.
To address these concerns, interim relief is essential. This relief acts as an urgent remedy granted in
exceptional circumstances, aimed at preventing irreparable harm to the aggrieved party. The criteria
for granting interim relief include:
 A prima facie case must be established.
 The balance of convenience should favor the party seeking relief.
 There is a risk of irreparable damage if the relief is not granted.
The objective is to safeguard the rights of the plaintiff without imposing undue hardship on the
defendant. For instance, if granting an injunction would impose greater costs and inconvenience on
the respondent than benefits to the applicant, the injunction may not be granted.
Interim Relief Under Sections 9 and 17 of the Arbitration Act
Interim Relief Under Section 9
Section 9 of the Arbitration and Conciliation Act, 1996 allows a party to seek interim relief from a
court before arbitration begins, during proceedings, or at any time before enforcing an arbitral award.
The court retains the authority to grant interim relief both prior to the establishment of an arbitral
tribunal and after an award has been issued.
If a court orders interim relief before arbitration starts, proceedings must commence within 90 days of
that order unless extended by the court. The types of interim relief available under Section 9 include:
  Appointment of a guardian for minors or individuals unable to manage their affairs.
 Preservation or sale of perishable goods related to the arbitration.
 Securing claims for monetary amounts.
 Allowing inspection or preservation of property or evidence.
 Granting interim injunctions or appointing receivers.
 Any other appropriate relief based on case specifics.
After an arbitral award is rendered, only the successful party entitled to enforce it can seek interim
relief under Section 9. The unsuccessful party cannot apply since there is no award in their favor.
In Dirk India Pvt. Ltd. v. Maharashtra State Power Generation Company Ltd., it was ruled that post-
award interim relief can be granted to protect the outcome of proceedings until enforcement occurs.
However, this relief is not available to losing parties since it would not benefit them.
Jurisdiction for Section 9 Applications
The court where arbitration is seated has exclusive jurisdiction over applications under Section 9. In
cases of international commercial arbitration involving at least one non-Indian party, applications
must be made in the High Court. Following amendments in 2015, foreign parties in international
arbitration can seek interim relief under Section 9 in Indian courts unless they have expressly
excluded its applicability.
Enforcement and Appeal Against Interim Relief Under Section 9
Interim relief orders issued by a court must be enforced like any other court order. Willful non-
compliance may lead to contempt proceedings. Appeals against interim orders can be made according
to Section 37(1)(b) of the Act.
Interim Relief Under Section 17
Section 17 empowers arbitral tribunals to grant interim measures upon application by a party after the
tribunal has been constituted and until an award is issued. The types of interim relief available under
Section 17 mirror those under Section 9.
However, unlike courts, arbitral tribunals cannot issue directives to third parties; their jurisdiction is
limited to parties involved in the arbitration agreement.
Orders for interim relief from an arbitral tribunal carry similar weight as court orders and are
enforceable as such. Non-compliance with these orders may also result in contempt proceedings, with
appeals available under Section 37(2) of the Act.
Overall, both Sections 9 and 17 provide mechanisms for ensuring that parties can obtain necessary
interim measures to protect their interests throughout arbitration proceedings.
Section 9(1) of the Arbitration and Conciliation Act allows parties involved in arbitration to seek
interim protection from a court at various stages: before, during, or after arbitration proceedings.
However, according to Sub-section (3) of Section 9, once an arbitral tribunal has been established, the
court loses the authority to adjudicate any requests for interim relief. This amendment aims to reduce
lengthy litigation and the number of applications submitted to the courts, thereby alleviating their
burden and granting arbitral tribunals equal power in managing interim measures during proceedings.
Common Reliefs Sought Under Section 9
Under Section 9(ii)(b) of the Arbitration Act, parties often seek to secure their financial interests by
ensuring that amounts in dispute are protected; courts may require parties to provide guarantees.
Section 9(ii)(c) allows courts to permit parties to take symbolic possession of properties and appoint
receivers for assets not directly involved in the dispute.
Section 9(ii)(e) grants courts broad powers to order parties to disclose their assets. Courts have also
found it permissible to attach property belonging to third-party respondents and prevent parties from
disposing of their assets.
Overall, Section 9 provides essential mechanisms for securing interim relief during arbitration
proceedings, ensuring that parties' rights are protected while minimizing court interference once an
arbitral tribunal is constituted.

CONCILIATION

The Halsbury’s Laws of England defines Conciliation as a process of persuading the parties to reach
an agreement. Conciliation may comprehensively be defined as a non-adjudicatory and non
adversarial. There is neither a claimant/plaintiff nor a respondent/defendant in conciliation and as a
result its proceedings are non-adversarial in nature. ADR mechanism involving a settlement procedure
wherein an impartial third party (conciliator) enables and steers the disputant parties to arrive at a
satisfactory and acceptable settlement of a dispute. It is considered as an effective and meaningful
alternative to litigation for resolution of disputes through the guidance and assistance of a neutral and
impartial third party. Conciliation is a voluntary process and the conciliator has no authority to impose
on the parties a solution to the dispute. Like any other ADR process the sanctity of conciliation is the
mutual determination of the parties to amicably resolve their disputes through an ADR mechanism.
Thus mutual agreement and not an imposed decision, forms the spirit of conciliation The consensual
nature of the dispute resolution process allows parties to join in a friendly search for an amicable
solution, without procedural restraints or protracted battles over formal technicalities and the parties
are encouraged to visualise options which provide solutions keeping in view their interests and
priorities.6 Generally, all civil disputes are suitable for conciliation and it affords an excellent ADR
mechanism for amicable resolution outside the litigative process.

HISTORY OF CONCILIATION IN INDIA : Conciliation is not a new concept as far as India is

concerned. Kautilya’s Arthashastra also refers to the process of conciliation. Various legislations in
India have also recognized conciliation as a statutorily acceptable mode of dispute resolution.

 Section 12 of the Industrial Disputes Act, 1947 contemplates settlement of disputes through
conciliation effected through conciliation officers appointed under the Act;
 Section 23 of the Hindu Marriage Act, 1955 and Order XXXII A, Code of Civil Procedure,
1908 enable the judge to effect settlement between the parties by recourse to conciliation.

Conciliation was in fact being frequently resorted to as a mode of dispute resolution under these
specific legislations. However, apart from these statutory provisions dealing with specified categories
of cases, conciliation in general as a mode of ADR lacked proper legislative framework and statutory
backing. In 1984 faced with the problem of surmounting arrears the Himachal Pradesh High Court
evolved a unique project for disposal of cases pending in courts by conciliation. This was also been
recommended by the Law Commission of India in its 77th and 131st reports and the conference of the
Chief Justices and Chief Ministers in December 1993. The Malimath Committee had also inter alia
recommended the establishment of conciliation courts in India.
In the mean time the UNCITRAL had adopted the UNCITRAL Conciliation Rules, 1980 and the
General Assembly of the United Nations had recommended the use of these rules, therefore, the
Parliament of India found it expedient to make a law respecting conciliation, and the Arbitration and
Conciliation Act, 1996 was enacted.

Conciliation was afforded an elaborate codified statutory recognition in India with the enactment of
the Arbitration and Conciliation Act, 1996 and Part III of the Act comprehensively deals with
conciliation process in general. The chapter on conciliation under the Arbitration and Conciliation
Act, 1996 is, however, essentially based on the UNCITRAL Conciliation Rules, 1980.

Thereafter post litigation conciliation was recognized as a mode of dispute resolution when section 89
was incorporated in the Code of Civil Procedure, 1908 which affords an option for reference of sub
judice matters to conciliation with the consent of parties for extra judicial resolution.

PROCESS OF CONCILIATION

Commencement Of Conciliation And Appointment Of Conciliator

The conciliation process commences when the disputing parties agree to conciliate and a neutral
conciliator is appointed. The party initiating conciliation sends a written invitation to conciliate to the
other party briefly identifying the subject matter of the dispute. Conciliation proceedings commence
when the other party accepts in writing the invitation to conciliate.

S. 62, Arbitration and Conciliation Act, 1996 Commencement of conciliation proceedings.— (1) The
party initiating conciliation shall send to the other party a written invitation to conciliate under this
Part, briefly identifying the subject of the dispute.

(2) Conciliation proceedings shall commence when the other party accepts in writing the invitation to
conciliate.

(3) If the other party rejects the invitation, there will be no conciliation proceedings.

(4) If the party initiating conciliation does not receive a reply within thirty days from the date on
which he sends the invitation, or within such other period of time as specified in the invitation, he
may elect to treat this as a rejection of the invitation to conciliate and if he so elects, he shall inform in
writing the other party accordingly

Thus conciliation agreement should be an ad hoc agreement entered by the parties after the dispute
has actually arisen and not before. Even if the parties incorporate conciliation clauses in their
agreements, still conciliation would commence only if the other party accepts the invitation of one
party to conciliate in case of a de facto dispute.

 Thus unlike in the case of an arbitration agreement, Part III of the Arbitration and
Conciliation Act, 1996 does not envisage any agreement for conciliation of future disputes. It
only provides for an agreement to refer the disputes to conciliation after the disputes have
arisen (Visa International Ltd. v. Continental Resources (USA) Ltd., AIR 2009 SC 1366).
 In conciliation proceedings ordinarily there is one conciliator unless the parties agree that
there shall be two or three conciliators. Even in case of plurality of conciliators they are
supposed to act jointly. An uneven number of conciliators is not necessary in conciliation
since the task of the conciliators is to make recommendations for a settlement and not to
render binding decisions.

In conciliation proceedings with one conciliator, the parties may agree on the name of a sole
conciliator and in conciliation proceedings with two conciliators, each party may appoint one
conciliator. The parties may also request any institution or person to recommend suitable
names of conciliators or directly appoint them and such person or institution while
discharging this responsibility should have regard to aspects as are likely to secure the
appointment of an independent and impartial conciliator.

Section 64 of the Arbitration and Conciliation Act, 1996 details the procedures for appointing
conciliators in conciliation proceedings. Here are the key points:

1. Types of Conciliators Based on Number

 Sole Conciliator (1):
 In cases where there is only one conciliator, the parties must mutually agree on the
name of that sole conciliator.


 Two Conciliators (2):
 If there are two conciliators, each party is entitled to appoint one conciliator.


 Three Conciliators (3):
 In scenarios involving three conciliators, each party appoints one conciliator, and they
must jointly agree on a third conciliator who will serve as the presiding conciliator.

2. Assistance from Institutions or Individuals

 Enlisting Help:The parties have the option to seek assistance from a suitable institution or
individual for the appointment of conciliators.
 Recommendations:A party may request such an institution or individual to recommend
suitable candidates for the role of conciliator.
 Direct Appointments:The parties can also agree that one or more conciliators be appointed
directly by the institution or individual.

3. Considerations for Appointment

 Independence and Impartiality: When recommending or appointing individuals, the institution
or person must ensure that the appointed conciliator is independent and impartial.
 Nationality Consideration: For a sole or third conciliator, it is advisable to consider
appointing someone from a different nationality than that of the parties involved. This helps
in maintaining neutrality and fairness in the conciliation process.

PROCEDURE IN CONCILIATION AND ROLE OF CONCILIATOR The conciliator may request

each of the parties to submit a brief written statement describing the general nature of the dispute and
the points at issue, with a copy to the opposite party. At any stage of the conciliation proceedings the
conciliator may request a party to submit to him such additional information as he deems appropriate.

Section 65 of the Arbitration and Conciliation Act outlines the procedures regarding the submission of
statements by parties involved in conciliation. Here are the key points:

1. Initial Submission of Statements

 Request for Brief Statements: Upon appointment, the conciliator can request each party to
provide a brief written statement that outlines the general nature of the dispute and key points
at issue. This ensures that the conciliator understands the context and specifics of the
conflict23.
 Copy Requirement: Each party must send a copy of their statement to the other party,
promoting transparency and ensuring both sides are aware of each other's positions from the
outset4.

2. Detailed Written Statements

 Further Requests: The conciliator may ask each party to submit a more detailed written
statement that includes their position, supporting facts, and relevant documents or evidence.
This step allows for a deeper understanding of each party's arguments and evidence
supporting their claims23.
 Document Sharing: Similar to initial submissions, parties are required to share these detailed
statements and supporting documents with each other, fostering an open dialogue5.

3. Additional Information
 Ongoing Requests: At any point during the conciliation proceedings, the conciliator has the
authority to request additional information from either party as deemed necessary. This
flexibility allows the conciliator to adapt to new developments or clarify uncertainties that
may arise during discussions24.

Explanation of Terminology
 Conciliator Definition: The term "conciliator" in this section refers not only to a sole
conciliator but also encompasses instances where there are two or three conciliators involved
in the process. This clarification ensures that all procedural guidelines apply regardless of the
number of conciliators appointed

The conciliator is supposed to assist the parties in an independent and impartial manner in their
attempt to reach an amicable settlement of their dispute. A conciliator assists parties by helping them
to initiate and develop positive dialogue, clarify misunderstandings, create faith upon one another and
generate a congenial atmosphere required for harmonious and cooperative problem-solving. In order
to justify his position the conciliator must be an impartial person. The parties should be able to repose
trust and confidence in him so as to enable them to share their secrets and their thinking process with
the conciliator with the belief that the same will not be divulged to other party without specific
instructions in that regard. The process of conciliation, inter alia, involves creating a constructive
bonding between the parties to a dispute to steer them towards resolution.

Section 67 of the Arbitration and Conciliation Act outlines the responsibilities and guiding principles
for conciliators during the conciliation process. Here are the key points:
1. Independent and Impartial Assistance
 Role of the Conciliator: The primary duty of the conciliator is to assist the parties in a neutral
and unbiased manner as they seek to resolve their dispute amicably. This independence is
crucial for fostering trust and cooperation between the parties.

2. Principles Guiding the Conciliator

 Objectivity, Fairness, and Justice: The conciliator must adhere to principles that ensure
objectivity, fairness, and justice throughout the proceedings.
 Considerations: In guiding their approach, the conciliator should consider:
 The rights and obligations of both parties involved.
 The customary practices within the relevant trade or industry.
 The specific circumstances surrounding the dispute, including any prior business
relationships or practices between the parties.

3. Conducting Conciliation Proceedings

 Flexibility in Approach: The conciliator has the discretion to conduct the proceedings in a
manner they deem appropriate, which allows for adaptability based on the unique aspects of
each case.
 Consideration of Parties' Wishes: The conciliator should take into account any preferences
expressed by the parties, including requests for oral statements or other forms of
communication.
 Emphasis on Speedy Resolution: A key objective is to facilitate a prompt settlement of the
dispute, which can help reduce costs and preserve relationships between parties.

4. Proposals for Settlement

 Making Proposals: At any point during the conciliation process, the conciliator has the
authority to suggest potential solutions or proposals for settling the dispute. This proactive
role can help guide discussions and encourage resolution.

The conciliator may conduct conciliation proceedings in such a manner as he considers appropriate,
taking into account the circumstances of the case and the wishes of the parties. The conciliator has
wide procedural discretion in shaping the dynamic process towards a settlement. The conciliator is not
bound by the Code of Civil Procedure, 1908 or the Indian Evidence Act, 1872.

He is to be guided by principles of objectivity, fairness and justice giving due consideration to the
rights and obligations of the parties, the usages of the trade concerned and the circumstances
surrounding the dispute, including any previous business practices between the parties. The
conciliator may invite the parties to meet him or may communicate with them orally or in writing. He
may meet or communicate with the parties together or with each of them separately.

Section 69 of the Arbitration and Conciliation Act, 1996 outlines the communication protocols
between the conciliator and the parties involved in the conciliation process. Here are the key points:

1. Modes of Communication
 Invitation to Meet: The conciliator has the authority to invite the parties for meetings,
facilitating direct interaction.
 Oral or Written Communication: The conciliator can communicate with the parties either
orally or in writing, providing flexibility in how information is exchanged.
  Individual or Joint Meetings: Meetings can be conducted with all parties together or
separately, allowing for tailored discussions that may encourage openness.

2. Determining Meeting Locations

 Place of Meetings: If the parties do not agree on a location for meetings, the conciliator is
responsible for determining an appropriate venue.
 Consultation with Parties: The conciliator must consult with the parties when deciding on the
meeting location, ensuring that their preferences and circumstances are taken Tinto account.

The conciliator may hold several joint or private meetings with the parties so as to enable the parties
to clarify their cases and so as to persuade the parties to arrive at a mutually acceptable solution. This
shows that depending upon the requirement from case to case basis the conciliator may or may not
adopt a structured process in conciliation.

Unless the parties have agreed upon the venue of conciliation proceedings the conciliator is supposed
to decide the venue of conciliation proceedings in consultation with the parties. Thus the conciliator is
vested with extensive power to choose and mould the procedure to be followed by him untrammeled
by the procedural laws, albeit in consultation with the parties. In order to facilitate the conduct of the
conciliation proceedings, the parties, or the conciliator with the consent of the parties, may arrange for
administrative assistance by a suitable institution or person. (S. 68, Arbitration and Conciliation Act,
1996). The role of the conciliator is to assist the parties to arrive at an amicable settlement. The
conciliator may, at any stage of the conciliation proceedings, himself make proposals for a settlement
of the dispute.

In the Indian context the conciliator therefore plays an evaluative role while managing the process of
conciliation as opposed to a mere facilitator. The conciliator assesses the respective cases of the
parties and apart from acting as a facilitator suggests and advices the parties on various plausible
solutions to the parties so as to enable the parties to choose the best possible and apt solution. He
attempts to get the parties to accept the merits and demerits of their cases thereby leading them to a
mutually acceptable solution.

The conciliator, in this manner plays a more proactive and interventionist role in persuading the
parties to arrive at a final settlement.

In Salem Advocate Bar Association v. Union of India, AIR 2005 SC 3353, The Supreme Court had
observed that, Settlement by 'Conciliation' means the process by which a conciliator who is appointed
by parties or by the Court, as the case may be, conciliates the disputes between the parties to the suit
by the application of the provisions of the Arbitration and Conciliation Act, 1996 (26 of 1996) in so
far as they relate to conciliation, and in particular, in exercise of his powers under sections 67 and 73
of that Act, by making proposals for a settlement of the dispute and by formulating or reformulating
the terms of a possible settlement; and has a greater role than a mediator. In actual practice conciliator
needs to be a person who is not only well-informed and diplomatic but can also influence the parties
by his persona and persuasive skills. However, if the system of conciliation is to succeed as a
proficient ADR mechanism professional training of conciliators needs to be a mandatory
requirement.

THE SETTLEMENT AGREEMENT

When it appears to the conciliator that there exist elements of a settlement, which may be acceptable
to the parties, he is supposed to formulate the terms of a possible settlement and submit them to the
parties for their observations. After receiving the observations of the parties, the conciliator may
reformulate the terms of a possible settlement in the light of such observations.

Section 73 of the Arbitration and Conciliation Act, 1996 outlines the process and implications of
reaching a settlement agreement during conciliation proceedings. Here are the key points:

1. Formulation of Settlement Terms

 Identifying Settlement Elements: When the conciliator identifies potential elements of a
settlement that may be acceptable to both parties, they are tasked with formulating the terms
of this possible settlement.
 Submission for Observations: The conciliator submits these terms to the parties for their
feedback or observations. This step allows parties to express their views and negotiate
adjustments.
 Reformulation: Based on the observations received, the conciliator may reformulate the terms
to better reflect the parties' interests and concerns.

2. Drafting and Signing the Settlement Agreement

Agreement on Settlement: If the parties agree on the terms, they can draft and sign a written
settlement agreement. This formalizes their resolution of the dispute. Conciliator's Assistance: If
requested, the conciliator may assist in drafting or finalizing this agreement, ensuring clarity and
mutual understanding.

3. Binding Nature of the Agreement Finality and Binding Effect: Once signed by both parties, the
settlement agreement becomes final and binding. It holds legal weight similar to a contract under the
Indian Contract Act, 1872. Enforcement Rights: Should either party fail to comply with the terms, the
other party has the right to seek enforcement through legal channels, ensuring that the agreement is
upheld.

4. Authentication and Distribution Conciliator's Role in Authentication: The conciliator is responsible

for authenticating the settlement agreement, which adds a layer of credibility to the document.
Providing Copies: Each party receives a copy of the signed agreement, ensuring that all parties have
access to the finalized terms for reference and enforcement.

The statutory provisions enjoin upon the conciliator to draw up and authenticate a settlement
agreement. He should ensure that the parties have full understanding of the settlement terms. The
agreement must embody the terms and conditions of the settlement with clarity and precision. It is
open to the parties to settle some of their disputes by conciliation and leave the unresolved disputes
between them for resolution by other modes of adjudication. The settlement agreement must also bear
the signatures of the parties. Once the parties sign the settlement agreement, it shall be final and
binding on the parties and persons claiming under them respectively.

The settlement agreement drawn up in conciliation proceedings has the same status and effect as if it
is an arbitral award on agreed terms on the substance of the dispute rendered by an arbitral tribunal
under section 30 of the Arbitration and Conciliation Act, 1996. However it is only that agreement
which has been arrived at in conformity with the manner stipulated and form envisaged and got duly
authenticated in accordance with section 73 of the Arbitration and Conciliation Act, 1996, which can
be assigned the status of a true settlement agreement and can be enforced as an arbitral award.
Therefore a settlement agreement arrived in private conciliation proceedings can be enforced by
executing the same in a civil court as if it were a decree of the court.

TERMINATION OF CONCILIATION PROCEEDINGS

A successful conciliation proceeding concludes with the drawing and signing of a conciliation
settlement agreement. The signing of the settlement agreement by the parties, on the date of the
settlement agreement terminates conciliation proceedings. That apart, any party may terminate
conciliation proceedings at any time even without giving any reason since it is purely voluntary
process. The parties can terminate conciliation proceedings at any stage by a written declaration of
either party. A written declaration of the conciliator, after consultation with the parties, to the effect
that further efforts at conciliation are no longer justified, also terminates conciliation proceedings on
the date of such declaration. Section 76 of the Arbitration and Conciliation Act, 1996 outlines the
circumstances under which conciliation proceedings can be terminated. Here are the key points:

1. Termination by Settlement Agreement

 Signing of Settlement Agreement: Conciliation proceedings are automatically terminated
when the parties sign a settlement agreement. This termination is effective on the date the
agreement is signed, marking the successful resolution of the dispute.

2. Termination by Conciliator's Declaration: Conciliator's Written Declaration: The conciliator may

terminate the proceedings by issuing a written declaration stating that further efforts at conciliation
are no longer justified. This declaration must be made after consulting with the parties involved.
Effective Date: The termination is effective on the date of this declaration, indicating that the
conciliator believes no further progress can be made.

3. Termination by Parties' Declaration

 Written Declaration by Parties: The parties can also terminate the conciliation proceedings by
providing a written declaration to the conciliator indicating their decision to end the process.
 Effective Date: Similar to other forms of termination, this declaration takes effect on the date
it is issued.

4. Termination by a Party's Declaration

 Individual Party Declaration: A party may unilaterally terminate the conciliation proceedings
by sending a written declaration to both the other party and the conciliator.
 Effective Date: This termination is effective on the date of the declaration, allowing for a
clear and straightforward exit from the conciliation process.

ADVANTAGES OF CONCILIATION

1. COST EFFECTIVE AND EXPEDITIOUS PROCESS

Conciliation is an economical and expeditious mechanism for resolution of disputes in comparison to

litigation and arbitration, which makes it an excellent ADR Mechanism.

 The cost management tools and expertise of the conciliator generally prevent multiplication
of actual costs to the parties and seek to make it cost efficient.
  The conciliator follows a simplified procedure suited to the aspirations of the parties and
keeping in mind the need for speedy settlement of the dispute.
 Moreover the time management tools applied by the conciliator prevent dragging on of
conciliation proceedings for longer periods and ensure its conclusion within a reasonable time
frame.
 The end result in conciliation is a negotiated settlement which is treated to be an arbitral
award on agreed terms, thereby obviating the possibility of successive appeals and finally
resolving the dispute in an expeditious and cost effective manner.

2. AUTONOMY AND CONVENIENCE OF PARTIES

Conciliation is flexible and convenient. The parties are free to agree on the procedure to be followed
by the conciliator, the time and venue of the proceedings and thus eventually control the process. The
conciliator may conduct the conciliation proceedings in such a manner as he considers appropriate,
taking into account the circumstances of the case, convenience of the parties and the wishes the
parties may express.

A very commendable feature of conciliation is that the parties can withdraw from conciliation at any
stage. Unless a party consents to the initiation and continuance of conciliation and accepts the
resultant settlement agreement he cannot be said to be bound by the process, and he may walk out
from conciliation proceedings at any time. This is unlike arbitration and litigation where decisions can
be made even if a party walks out. The parties therefore not only control the procedure in conciliation
proceedings but also the final outcome of the proceedings. Indeed party autonomy is a very laudable
feature of conciliation.

3. CREATIVE SOLUTIONS/ REMEDIES

In litigation or arbitration what solution or resolution would be contained in the judgment or award is
not within the control or prior knowledge of the parties and moreover the ultimate decision is based
on a straightforward decision on merits keeping in view the rights and positions of the parties. In
conciliation however the parties control the outcome and can incorporate terms and conditions in the
settlement agreement as per mutual agreement. They can devise creative solutions for their disputes at
one go which may not have been within the contemplation of an arbitrator or a judge. They can also
decide how their rights and liabilities are going to be actually worked out on resolution of the dispute
and chalk out ingenious modalities for complying with the basic terms of settlement.

4. PARTY SATISFACTION AND HARMONY

Unlike litigation and arbitration where one party wins and the other loses, in conciliation both parties
are winners as the decision is acceptable to both. Both parties are in favour of the decision, as until
both parties agree to a proposal, the settlement or agreement does not take place. Therefore it is a win-
win situation for both the parties as both the parties are satisfied with the agreement. Such win-win
situation enables them to retain good relationship for times to come unlike litigation and arbitration
where the parties on account of the win-loss equation are not able to continue or rebuild their
relationship. Even where the conciliation proceedings do not fructify into a settlement, they prove to
be useful by enabling the parties to understand each other’s versions, positions and aspirations in a
better perspective.

5. CONFIDENTIALITY
In contradistinction to judicial proceedings conciliation is a private closed door affair and therefore
offers privacy and confidentiality. In fact confidentiality in conciliation proceedings is a statutory
guarantee 54 which makes conciliation an excellent dispute resolution mechanism.

Sec 75. Confidentiality.—Notwithstanding anything contained in any other law for the time being in
force, the conciliator and the parties shall keep confidential all matters relating to the conciliation
proceedings. Confidentiality shall extend also to the settlement agreement, except where its disclosure
is necessary for purposes of implementation and enforcement.

The conciliator and the parties are supposed to keep confidential, all matters relating to the
conciliation proceedings. The parties are also precluded from relying upon or introducing as evidence
in subsequent arbitral or judicial proceedings views expressed or suggestions made by the other party
in respect of a possible settlement of the dispute, admissions made by the other party in the course of
conciliation proceedings, proposals made by the conciliator and the fact that the other party had
indicated his willingness to accept a proposal for settlement made by the conciliator.

Sec 81. Admissibility of evidence in other proceedings.—

The parties shall not rely on or introduce as evidence in arbitral or judicial proceedings, whether or
not such proceedings relate to the dispute that is the subject of the conciliation proceedings,—

o views expressed or suggestions made by the other party in respect of a possible

settlement of the dispute;
o admissions made by the other party in the course of the conciliation proceedings;
o proposals made by the conciliator;
o the fact that the other party had indicated his willingness to accept a proposal for
settlement made by the conciliator.

Even during the course of conciliation proceedings where a party gives any information to the
conciliator subject to a specific condition that it be kept confidential, the conciliator is not supposed to
disclose that information to the other party. This ensures that even in the eventuality of failure of
conciliation proceedings neither party is able to derive undue benefit out of any proposal, view,
statement, admission, etc. made by the opposite party during conciliation proceedings. The process of
conciliation provides an opportunity for settlement of disputes without publicity.58 The conciliator is
also precluded from acting as an arbitrator or as a representative or counsel of a party in any arbitral
or judicial proceeding in respect of a dispute that is the subject of the conciliation proceedings nor can
he be presented by the parties as a witness in any arbitral or judicial proceedings.

6. ENFORCEABILITY OF CONCILIATION SETTLEMENT AGREEMENT

The settlement agreement drawn up in conciliation proceedings has the same status and effect as if it
is an arbitral award on agreed terms on the substance of the dispute rendered by an arbitral tribunal
under section 30 of the Arbitration and Conciliation Act, 1996. Thus the settlement agreement in
conciliation is executable as a decree of the civil court.61 It is open to any party to apply for execution
of the settlement agreement by filing an execution petition before the civil court. The expeditious
enforcement of a conciliation settlement agreement in a summary manner i.e. by way of execution
proceedings in a civil court is the principal advantage attached with conciliation.
Sec 74. Status and effect of settlement agreement.—The settlement agreement shall have the same
status and effect as if it is an arbitral award on agreed terms on the substance of the dispute rendered
by an arbitral tribunal under section 30.

Negotiation

Negotiation is derived from the Latin word 'negotiari' which means 'to carry on business, do business'.
Negotiation is very prominent among Indians; we get to see it from the street while negotiating the
price of anything with the big multinational companies while negotiating deals with them. Negotiation
is defined as self-counseling between the parties to resolve the dispute. In negotiation, parties, with
their own will, by discussing politely and patiently, try to come up with a solution that is acceptable to
both parties regarding the issue. Negotiation is a process of discussion and communication between
two or more parties with the aim of reaching an agreement or resolving a dispute. It involves
identifying common interests, exploring potential solutions, and finding compromises that satisfy all
parties involved.

One of the key reasons why negotiation is important is its ability to preserve relationships.

Unlike litigation, which often results in winners and losers, negotiation allows people to work
together towards a resolution that meets everyone's needs. This collaborative approach fosters
understanding, builds trust, and maintains positive connections for future interactions.

Moreover, negotiation provides a cost-effective alternative to legal proceedings. Litigation can be

time-consuming, expensive, and emotionally draining for all parties involved. By engaging in
negotiations instead, individuals can save valuable time and resources while still achieving their
desired outcomes.

Additionally, negotiation promotes creative problem-solving. It encourages participants to think

outside the box and explore innovative solutions that may not have been considered initially. This
flexibility allows for unique agreements tailored specifically to the needs of those involved.
Negotiation empowers individuals by giving them control over the outcome of their disputes. Rather
than relying on judges or arbitrators to make decisions on their behalf, negotiators have the
opportunity to actively shape the terms of their agreements.

Characteristics of negotiation

Characteristics of negotiation are:

Voluntary: This is one of the important characteristics of negotiation, i.e., it should be completely
voluntary, and no party can be forced to negotiate with the other party.

Whichever party wants to negotiate will send a letter to the other party, asking to negotiate. If the
other party agrees to negotiate without any force or threat, only then can both parties take further steps
to negotiate

Bilateral/multilateral: Negotiation can be conducted between two or more parties, as many as may be
required.
Non adjudicative: Negotiation is a process that includes only parties to the issue to get a solution
amicably and no third neutral party takes part in the negotiation process.

Informal: unlike other alternative dispute resolutions, negotiation is an informal method. There are no
rules defined for negotiation; parties to the issue make their own rules with mutual discussion and
acceptance.

Flexible: Negotiation totally depends on the choice of parties, i.e., where it will take place, when it
will take place, what will be the topic of negotiation, which approach they will take, etc.

Advantages of negotiation

Negotiation is a flexible process, i.e., it depends on the discretion of the parties as to whether they
want to opt for negotiation to resolve the issue or not; if yes, where it should be conducted; in how
many meetings the negotiation should be done; and there are no specified rules for negotiation; parties
can conduct it in their own way.

Unlike other issue resolving processes (e.g., litigation, arbitration, etc.), it is more likely to come to a
conclusion that can be favourable for both parties.

It is a voluntary process and can only be opted for with the consent of each party. It is the discretion
of the parties whether they want to negotiate.or not and the decision of any party shouldn't be forced
or manipulated by the other party.

Negotiation involves only parties to the issue and there is no interference from any third party for
dispute resolution, which is a great advantage for the parties who don't want to involve any outsiders
in the issue.

Negotiation is the process that only binds the parties to an issue, unlike other processes. (e.g.,
litigation). For example, in litigation, if a decision is passed by the court, then it will be taken into
consideration or, as a in further similar cases, but in negotiation, there's nothing like that; if somebody
gets into a similar dispute with someone else, then it is not necessary to take their decision into
consideration i.e., they can come to a different conclusion.

since in negotiations, disputes are resolved amicably, which enhances the relationship between the
parties for future interactions.

As negotiation is a voluntary process, there will be no court fees or other expenses, which makes it a
less expensive dispute resolution process compared to others.

Evidently, negotiation is a faster process to resolve any dispute, as there is no interruption by the court
or any other third party to keep giving dates for the hearings to resolve the issue.

Negotiation is always a good option for any sensitive issue because this is a very private resolution
process that only includes the parties to the dispute.
Disadvantages of negotiation

The disadvantages of negotiation are:

If the negotiation is conducted between the unequal parties, then there are huge chances that the
stronger party will get more benefits as compared to the weaker party, which is morally wrong.

Where there are benefits to the absence of the third party, there are also drawbacks.

Due to the absence of third party, there are chances in negotiation that the parties will not come to any
agreement and all the time and money incurred by the parties will be a waste.

If one of the parties doesn't know about their rights, then due to the absence of this neutral party, there
are huge chances that the other party can take advantage of that party.

If any party changes its mind, backs off after initiating negotiation, and withdraws itself from the
proceedings of negotiation, then the amount of time and money invested in the negotiation will
become a waste.

Steps for negotiation

Preparation: Before becoming a part of the negotiation process, parties need to prepare themselves for
what can be the Best Alternative to a Negotiated Agreement (BATNA) and what can be the Worst
Alternative to a Negotiated Agreement (WATNA).

They also need to decide whether the other party is willing to resolve the dispute or not.

Discussion: Before conducting negotiation, setting ground rules for the negotiation is crucial that what
will be the venue of the negotiation, timings, what will be the approach they want to go with etc.

Clarification of goals: Parties to the negotiation should have to clarify their goals and viewpoints and
resolve any misunderstandings.

Bargaining and problem solving: this is the most important part of the negotiation process. Parties to
the negotiation share their points of view, adjust according to the situation and come to a conclusion
that is acceptable to all parties.

Agreement: after coming to a conclusion, an agreement is made according to the decided solution of
the dispute and then signed by the parties to the negotiations.

Implementation: After signing the agreement, parties need to implement and operate according to the
agreement.
Prepare alternatives: It's important to

consider alternative options if an agreement

cannot be reached through traditional negotiations. Brainstorm potential alternatives before entering
into negotiations so that you have backup plans ready if needed.

Types of negotiation

Types of negotiations are:

Distributive negotiation: In this type of negotiation, parties negotiate over one topic, which creates a
win-lose situation for the parties due to which one party will get the advantage.

Integrative negotiation: In this, parties negotiate over many topics, which creates chances to get a win-
win situation for the parties and mutual gain.

Team negotiation: In this type of negotiation, the parties negotiate in teams.

Multiparty negotiation: In which ver negotiation there are more than two parties, that negotiation
becomes a muftiparty negotiation.

Conclusion

Alternative dispute resolution (ADR) includes many methods to resolve disputes; one of them is
negotiation. When parties to a dispute want to resolve it amicably, they opt for negotiation. In
negotiation, there are high chances to reach a conclusion that is good for both parties and get
satisfaction with the solution. But sometimes, due to the absence of the third neutral party, there are
chances that either party to the negotiation may not get a solution or one party will wrongly use its
position or any party can back off at any time.

Therefore, negotiation is a great method to resolve disputes, but there are some drawbacks to It.

Elaborative Answer: Various Techniques of ADR, Their Processes, and Their Advantages
Introduction
Alternative Dispute Resolution (ADR) refers to mechanisms that provide a platform for resolving
disputes outside the traditional judicial system. ADR methods are designed to reduce the burden on
courts and provide faster, cost-effective, and accessible dispute resolution. The increasing backlog of
cases in Indian courts has made ADR an indispensable tool in the legal framework. This answer
elaborates on the various ADR techniques, their processes, and the benefits they offer.

A. Arbitration
Process
Arbitration involves an agreement between two or more parties to submit a dispute for resolution by
an impartial arbitrator or tribunal. The arbitrator conducts proceedings in a judicial manner, records
evidence, and delivers a binding decision called an “award.” The parties may appoint an arbitrator by
mutual consent, or the court can appoint one if necessary.
Advantages
1. Efficiency: Arbitration is faster and more flexible compared to traditional court procedures.
2. Expertise: Arbitrators often possess specialized knowledge in the subject matter, ensuring
informed decisions.
3. Privacy: Proceedings are private, safeguarding confidentiality.
4. Binding Decision: The award is enforceable by law and not subject to appeal.
Limitations
Arbitration is not suitable for:
 Criminal matters.
 Matrimonial disputes like divorce or custody.
 Insolvency issues.
 Corporate dissolutions.
 Disputes involving age determination.

B. Conciliation
Process
Conciliation involves a third party, known as a conciliator, who facilitates negotiations between
disputing parties. Unlike arbitration, the conciliator does not issue a binding decision but helps parties
arrive at a mutually acceptable settlement.
Advantages
1. Voluntary Process: Parties retain control over the outcome and can terminate proceedings at
any time.
2. Flexibility: No strict procedural rules are followed.
3. Non-Adversarial: Emphasis on compromise and maintaining relationships.
4. Confidentiality: Proceedings remain private and do not affect any subsequent legal actions.

C. Mediation
Process
Mediation involves a mediator who helps disputing parties negotiate and resolve their differences. The
mediator does not impose a decision but assists in creating an agreement. The process is voluntary and
entirely confidential.
Advantages
1. Cost-Effective: Mediation is less expensive than litigation or arbitration.
2. Preserves Relationships: Focus on collaboration and reducing hostility.
3. Customizable Solutions: Agreements are tailored to the needs of the parties.
4. Quick Resolution: Avoids lengthy judicial delays.
Difference from Conciliation
While both involve third-party assistance, conciliators can provide suggestions on the merits of the
dispute, whereas mediators refrain from giving opinions.

D. Pre-Trial Mediation
Process
Introduced under Section 89 of the Code of Civil Procedure, 1908, pre-trial mediation aims to
resolve disputes before initiating formal court proceedings. It is particularly useful in family disputes
where litigation may strain relationships.
Advantages
1. Time-Saving: Resolves disputes before court involvement.
2. Promotes Harmony: Encourages amicable settlements, especially in sensitive cases.

E. Negotiation
Process
Negotiation involves direct discussions between parties to arrive at a mutually acceptable solution. It
is the most basic and informal form of ADR.
Advantages
1. Simplicity: Requires no formal procedures or third-party involvement.
2. Control: Parties have complete control over the process and outcome.
3. Wide Applicability: Used in all areas of life, including domestic, corporate, and legal
disputes.
Legal Provisions
 Section 320 of the Code of Criminal Procedure, 1973: Allows for compounding of specific
criminal offenses.
 Section 265A of the Code of Criminal Procedure, 1973: Provides for plea bargaining.
F. Lok Adalat
Process
Lok Adalats are informal courts established under the Legal Services Authorities Act, 1987, for
resolving petty disputes. They follow a conciliation-based approach and are presided over by legal
experts and judicial officers.
Advantages
1. Accessibility: Free and open to all, especially beneficial for economically weaker sections.
2. Speed: Disputes are resolved in a single session.
3. Binding Nature: Awards are equivalent to a civil court decree.
4. Cost Savings: Court fees are refunded in settled cases.
Significance
Lok Adalats play a crucial role in reducing the judiciary’s burden and providing justice to
marginalized communities.

G. Med-Arbitration
Process
Med-Arbitration is a hybrid approach where parties first attempt mediation. If mediation fails, the
matter is referred to a third party for binding arbitration.
Advantages
1. Comprehensive: Combines the benefits of mediation and arbitration.
2. Efficiency: Resolves disputes in a structured manner.

H. Medola
Process
Medola is used when arbitrators fail to reach an agreement. A neutral negotiator replaces the arbitrator
and works to reach a middle ground acceptable to both parties.
Advantages
1. Neutrality: Ensures impartiality in decision-making.
2. Flexibility: Adapts to the needs of the disputing parties.

I. Mini-Trial
Process
In a mini-trial, disputing parties present their arguments and evidence to an impartial third party, who
provides a non-binding conclusion.
Advantages
1. Impartiality: Conducted by an independent person trusted by both parties.
 2. Cost and Time Savings: Offers a quick and informal resolution process.

Importance of ADR in India

1. Judicial Relief: ADR mechanisms alleviate the burden of over 2.34 crore pending cases in
Indian courts (2002 data).
2. Accessibility for Marginalized Groups: ADR provides affordable and non-technical options
for illiterate and economically weaker sections.
3. Efficiency: Speeds up dispute resolution, allowing courts to focus on serious criminal
matters.
4. Economic Benefits: Reduces litigation costs borne by taxpayers.
5. Promotes Harmony: Encourages peaceful dispute resolution, fostering better relationships
between parties.

Conclusion
ADR is an indispensable part of India’s legal framework, offering efficient, cost-effective, and
accessible dispute resolution. It provides citizens with alternatives to avoid the complexities and
expenses of traditional courts, making justice more inclusive and timely. Awareness and promotion of
ADR techniques are vital for achieving a fair and equitable justice system.