Arbitration alone is not ADR; ADR maybe through the following modes of ADR:

• Negotiation: Is a non-binding procedure, in which discussions between the parties are initiated without the intervention of any third party, with the sole objective of arriving at a negotiated settlement of a dispute.

• Conciliation/Mediation: A non-binding procedure in which an impartial third party i. e the conciliator or the mediator, assists the parties to a dispute in reaching a mutually satisfactory and agreed settlement of disputes.

• Mediation/Arbitration : A Procedure which combines conciliation and mediation at a subsequent stage in instances where the dispute is not settled through either conciliation/mediation within a period of time agreed in advance by the parties to arbitration.

• Mini Trial: A Non- binding procedure in which the disputing parties are presented with summaries of their cases, so as to enable them to access the strengths, weaknesses and prospects of their case and then an opportunity to settle it is explores.

• Arbitration: Is a procedure in which the dispute is submitted to an arbitral tribunal which makes a decision (an award) on the dispute, that is binding upon the parties.

• Fast Track Arbitration: A form of Arbitration in which the arbitration procedure is rendered in a particularly short time and that too at a reduced cost.

• Lok Adalats : Besides the above, Lok Adalats are also doing well as a mode of alternate dispute resolution system.

• Tribunals: Tribunals are similar to a court without the ritual or formality, there are number of specialized tribunals which bear the name of their specialization, e.g.; Employment Tribunal, Immigration Tribunal

• Ombudsman: Ombudsman is a person with special powers to investigate cases in certain areas such as health, pensions or in instances where there may be a dispute particularly if a governmentbody is involved. An ombudsman can only recommend as to how a dispute may be resolved, however his/her recommendations cannot be enforced.


1. To comprehensively cover international commercial arbitration and conciliation as also domestic arbitration and conciliation;

2. To make provision for an arbitral procedure it is fair, efficient and capable of meeting the needs of the specific arbitration:

3. To provide that the arbitral tribunals remain within the limits of its jurisdiction;

4. To ensure that the arbitral tribunal remains within the limits of its jurisdiction;

5. To minimize the supervisory role of courts in the arbitral process;

6. To permit an arbitral tribunal to use mediation, conciliation or other procedures during the arbitral proceedings to encourage settlement of disputes;

7. To provide that every final arbitral award is enforced in the same manner as if it were a decree of the court;

8. To provide that a settlement agreement reached at by the parties as a result of conciliation proceeding will have the same status and effects as an arbitral award on agreed terms on the substance of the dispute rendered by an arbitral tribunal; and

9. To provide that for the purpose of enforcement of foreign awards, every arbitral award made in a country to which one of the two international conventions relating to foreign arbitral awards to which India is a party applies will be treated as foreign award.


Under ADR, a dispute maybe settled out of court and that too without litigation; however ADR system applies to only those disputes, as have arisen out of a legal relationship which may or may not be contractual.


• Speed: ADR is far quicker than the traditional litigation methods of going to courts, certain types of ADR supply very quick solutions, and ensure that the legal system can operate more quickly with lesser damage.

• Economy of Cost: ADR proceedings tend to be less formal and expensive than traditional litigation, more particularly because, in most cases ADR processes are successful in avoiding the expenses incurred for engaging court barristers or solicitors.

• Expertise. In ADR, experts are frequently used, in matters where judges are unlikely to have expert knowledge.9

• Restores good Relations between disputing parties: An ADR system brings, both parties to terms without damaging their good relations, and is in fact quite instrumental in restoring their relations to a position, as had existed before the creation of such dispute.

• ADR System is Devoid of Corruption : ADR system is free from corruption, which is on and off found and of whose existence there is always a likely apprehension in any of the traditional justice systems.

• Free from Prejudice: Since both parties to ADR come to terms on mutually agreeable terms & that too out of their own free will, without having any fear of consequences of winning or losing the system on a whole is quite free from prejudice.

• Confidentiality: ADR process maintains confidentiality and is not open to public at large. And thus consequently saves the parties from the fear of any adverse publicity.

• Option of Withdrawing from Some Kinds of ADR is Always Open: ADR reserves the freedom of parties to withdraw from conciliation without prejudice to their legal position, inter-se at any time during the commencement of such proceedings.

• ADR is a Flexible and Independent Dispute Resolution System: ADR is a very flexible and independent system of dispute resolution, which is free of any statutory or custom ridden procedural law.

• Choice of Decision Maker : The Choice of selecting the mediator and the arbitrator lies with the parties and they are free to appoint any mutually agreeable, expert to adjudicate over any issue in dispute.

• ADR Helps in Clearing Bottle Necks in Litigation : ADR mechanism is quite instrumental in clearing bottlenecks, within the domestic judicial syste