NATIONAL LAW UNIVERSITY, ODISHA

SUBJECT
ALTERNATIVE DISPUTE RESOLUTION

PROJECT TOPIC
UNDERSTANDING THE NATURE OF DISPUTES IN ADR

SEMESTER – 7th

SUBMITTED TO: SUBMITTED BY:

Mr. Abhay Kumar IshwarCharan(16BA044)

(Assistant professor of law)

Mr.Akash Kumar
(Assistant professor of law)
 ACKNOWLEDGEMENT

We would like to hereby acknowledge the contribution of everyone without whom the
successful completion of this project would not have been possible.

Then I would like to thank Mr. Abhay Kumar (Assistant Professor of Law) and Mr Akash
Kumar (Assistant Professor of law) for their able guidance and clearing of doubts arising
during the course of execution of the project.

I am also grateful to my parents for everything they have done for me. They have been a
constant source of inspiration and motivation for me which enabled me to study in a
reputed institution.

I would also appreciate the aid and assistance of the librarian and other staff members of
NLUO for their support.

I also acknowledge the help and encouragement provided by my seniors, who guided me
to apply my efforts in right direction.

Lastly, I am grateful to my friends and colleagues for their support and for being a constant
source of enthusiasm.
 TABLE OF CONTENTS

ACKNOWLEDGEMENT...............................................................................................................2

INTRODUCTION...........................................................................................................................4

STATEMENT OF PURPOSE.........................................................................................................5

IMPORTANCE OF RESEACH......................................................................................................5

RESEARCH METHODOLOGY....................................................................................................5

HYPOTHESIS.................................................................................................................................5

RESEARCH QUESTIONS.............................................................................................................6

SCOPE.............................................................................................................................................6

CHAPTER I.....................................................................................................................................7

DIFFERENT TYPES OF ADR AND THE DIFFERENCES BETWEEN EACH OF THEM.......7

CHAPTER II.................................................................................................................................11

HOW TO UNDERSTAND THE NAURE OF ANY DISPUTE IN ADR?..................................11

CHAPTER III................................................................................................................................14

RECENT DEVELOPMENTS IN THE FIELD OF UNDERSTANDING THE NATURE OF

ADR...............................................................................................................................................14

CONCLUSION..............................................................................................................................19

BIBLIOGRAPHY..........................................................................................................................20

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 INTRODUCTION

Alternative Dispute Resolution is a method which is used for settling disputes outside of the
courtroom. Generally, most people tend to avoid being involved in any litigation, as the same is
quite lengthy and apparently expensive. That is when ADR becomes useful, parties opt for ADR
to avoid litigation.

Alternative dispute resolution is not something new in India and it existed under the earlier
Arbitration Act, 1940 also. The Arbitration and Conciliation Act, 1996 has been enacted in
alignment with the mandates of UNCITRAL Model. To make the Indian legal system more
efficient, amendment has been brought in Code of Civil Procedure, (CPC) 1908 to bring in
section 89 whereby clause (1) of the same provides for an option of settlement of disputes
outside the court. It states that the court may if it thinks necessary in the circumstances of the
case and finds that there are elements, may formulate a settlement and refer the same under the
suitable mode of ADR. Slow judicial process and backlog of plethora of cases, has given a solid
boost to the viability of ADR mechanisms in India. Arbitration and Conciliation Act, 1996 can
be said to be standard western approach with respect to ADR whereas the Lok Adalat system
which come under the National Legal Services Authority Act, 1987 can be said to be unique and
Indian approach. Any dispute can be solved when we understand its nature and doing so
becomes very important especially in Alternative Dispute Resolution as there are different modes
of it and the cases should be allocated to the different modes on the basis of the nature of the said
dispute.

Following different modes of ADR are as follows:

1. Arbitration

2. Mediation

3. Conciliation

4. Negotiation

5. Judicial settlement including settlement through Lok Adalat.

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We will be focusing on the different modes of ADR and why is it important to understand the
nature of the dispute under them, in the following chapters.

STATEMENT OF PURPOSE

The purpose of this paper is to bring forth the key determining factors of nature of a dispute in
ADR. The authors have attempted to find out such factors or circumstances which determine the
nature of a dispute and which form of ADR to be adopted to most effectively resolve such
dispute. This paper helps the reader to understand the nature of ADR in different modes of ADR.
The authors have made effort to find the most reliable sources and literature for understanding
nature of such dispute.

IMPORTANCE OF RESEACH

This paper attempts to may act as a guiding tool for any person whether a student or a
professional in clearly understanding disputes under various modes of ADR. The authors haves
used both descriptive as well as analytical approach which is unique and tried to contribute in the
existing literature to help the reader as a guiding tool in understanding the nature of disputes and
selecting the right mode of ADR as well as create a holistic understanding for academic puposes.

RESEARCH METHODOLOGY

In order to complete this project, the methodology of doctrinal research has been put to use. The
sources referred in this project are both primary as well as secondary. The cases cited are
primary sources, while the books and other resources are secondary ones. The mode of citation
used is OSCOLA.

HYPOTHESIS

Nature of dispute with respect to ADR is a decisive factor. The nature of disputes has been
variably defined and interpreted under various sources of law. The dispute resolution
mechanisms in India has strengthened and has become more effective. However, there is dire

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need for promotion and creating awareness in the legal fraternity as well as general public to
make the ADR mechanisms more effective.

RESEARCH QUESTIONS

1. What are the different types of ADR and what is the difference between each of them?
2. How to understand the nature of any dispute in ADR?
3. Recent developments in the field of understanding the nature of ADR. Judicial
developments, committees, commissions and other sources?

SCOPE

The scope of the project is limited to finding out how important it is to understand the nature of
dispute in ADR and how then how to allocate the cases to different modes of ADR based on the
said nature of the dispute.

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 CHAPTER I
DIFFERENT TYPES OF ADR AND THE DIFFERENCES BETWEEN EACH OF THEM

A brief description of few widely used ADR procedures is as follows:

1. Negotiation: It basically a non-binding procedure where the discussion takes place

between parties without any intervention from third party and it initiated at the instance
of both the parties, and the object is to arrive at a settlement of the said dispute by such
negotiation1.

2. Conciliation: In case of conciliation the dispute is resolved by the conciliator who talks to
each of the parties separately and then the parties can accept the advise of the conciliator.
It is basically a non-binding process where the conciliator has the duty to assist the
parties to the dispute at arriving at a mutually agreed2.

3. Mediation: It is also a non-binding process where a mediator who is an impartial third

party tries that the parties to the dispute come at a resolution but he does not have the
authority to impose the said resolution on them and they can decide as per their
convenience and free will3.

4. Arbitration4: Under arbitration the dispute is referred to an arbitrator(s) who is appointed

to review the case and gives a decision which becomes legally binding on both the parties
to the dispute. But there needs to be an agreement in this regard under The Arbitration
and Conciliation Act 1996.5
1
Investopedia. (2019). How Negotiations Work. [online] Available at:
https://www.investopedia.com/terms/n/negotiation.asp [Accessed 14 Aug. 2019].
2
Christoph Greggersen, 2. (2019). What is conciliation? - Dispute Resolution Hamburg. [online] Dispute-resolution-
hamburg.com. Available at: http://www.dispute-resolution-hamburg.com/conciliation/what-is-conciliation/
[Accessed 14 Aug. 2019].
3
Findlaw. (2019). What is Mediation? - FindLaw. [online] Available at: https://adr.findlaw.com/mediation/what-is-
mediation-.html [Accessed 14 Aug. 2019].
4
Anon, (2019). [online] Available at: https://www.wipo.int/amc/en/arbitration/what-is-arb.htm [Accessed 14 Aug.
2019].
5
Mondaq.com. (2019). Alternate Dispute Resolution (ADR) In India - Litigation, Mediation & Arbitration - India.
[online] Available at:
http://www.mondaq.com/india/x/654324/court+procedure/Alternate+Dispute+Resolution+ADR+In+India
[Accessed 10 Aug. 2019].

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Main differences between each of them are as follows:

MEANING - Arbitration6 disputes are resolved by Arbitrator who is a neutral person appointed
to resolve the said dispute outside the court whereas in under Mediation the person who resolves
a dispute is called a Mediator. Under Conciliation, the dispute is resolved by a conciliator. He
provides assistance to the parties to reach a settlement7.

APPLICABILITY - For arbitration, to take place there needs to be an agreement between the
parties as per section 78 of the 1996 Act9, and the agreement should be in writing in order to
make it enforceable. Also, an arbitrator is appointed where specialization is needed. Whereas for
Mediation or Conciliation having an agreement is not a prerequisite. A mediator or conciliator
are the ones appointed in cases which involve minor disputes10.

PROCEDURE - Arbitrator leads the procedure carefully by legitimate limitation and will
undoubtedly pursue the unbiased methodology in settling the debate 11. On account of Mediation,
the mediator has the freedom to choose any appropriate technique for determination of the
question as there are no exacting rules to pursue. While in the event of conciliation the
conciliator will undoubtedly pursue the procedure given under the Arbitration and Conciliation
Act (Sections 61 to 81)12.

COST - The Process of Arbitration when contrasted with mediation and conciliation, it all the
more expensive and protracted procedure13. If there should arise an occurrence of Arbitration,

6
Mediate.com. (2019). What is Arbitration?. [online] Available at: https://www.mediate.com/articles/grant.cfm
[Accessed 14 Aug. 2019].
7
Alessandra Sgubini, M. (2019). Arbitration, Mediation and Conciliation: differences and similarities from an
International and Italian business perspective. [online] Mediate.com. Available at:
https://www.mediate.com/articles/sgubiniA2.cfm [Accessed 14 Aug. 2019].
8
The Arbitration and Conciliation Act 1996.
9
Legislative.gov.in. (2019). [online] Available at: http://legislative.gov.in/sites/default/files/A1996-26.pdf
[Accessed 14 Aug. 2019].
10
iPleaders. (2019). How arbitration, mediation and conciliation are different from each other. [online] Available at:
https://blog.ipleaders.in/arbitration-mediation-and-conciliation-different/ [Accessed 14 Aug. 2019].
11
Lawcommissionofindia.nic.in. (2019). [online] Available at:
http://lawcommissionofindia.nic.in/adr_conf/concepts%20med%20Rao%201.pdf [Accessed 14 Aug. 2019].
12
The Arbitration and Conciliation Act 1996
13
Blogs.compliancecalendar.in. (2019). Know ADR and Difference Between Arbitration, Conciliation And
Mediation By Nisha Shaw. [online] Available at: https://blogs.compliancecalendar.in/know-adr-and-difference-
between-arbitration-conciliation-and-mediation-by-nisha-shaw-440 [Accessed 14 Aug. 2019].

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each party pays for its very own costs or Arbitrator. Then again, if there should be an occurrence
of conciliation and mediation, the expense of procedure and mediator and conciliator is similarly
separated among the parties.

JUDGEMENT - An Arbitrator is a judge of the dispute and gives resolution estimates which are
mandatory on the parties except if parties beforehand concurred that the result of the procedure
won't be binding. In the instance of mediation, a mediator does not convey any judgment 14. A
mediator is just a facilitator who helps with creating choice and discourse between the parties to
accomplish a shared understanding good for both the parties 15. While if there should be an
occurrence of conciliation, the job of a conciliator is more than that of a mediator as a conciliator
is considered to have a much important role and isn't simply a facilitator 16. A conciliator can
according to Section 67(4) of the 199617 act can make a proposition for settlement between the
parties when there is extension for settlement which is exhibited to parties and the parties and if
the parties have an issue then the conciliator has the option to change the settlement
proposition18.

LOK ADALAT

Lok Adalat is one of the alternative dispute resolution instruments, it is where

disputes/cases pending in the official courtroom or at pre-litigation stage are settled
amicably. Lok Adalats have been given statutory status under the Legal Services
Authorities Act, 1987. Under the said Act, the decree made by the Lok Adalats is deemed
to be a decree of a common court and is conclusive and authoritative on all parties and no

14
S, S. (2019). Difference Between Mediation and Conciliation (with Comparison Chart) - Key Differences. [online]
Key Differences. Available at: https://keydifferences.com/difference-between-mediation-and-conciliation.html
[Accessed 14 Aug. 2019].
15
Site CMAP. (2019). What is the difference between mediation and conciliation? - Site CMAP. [online] Available
at: http://www.cmap.fr/faq/what-is-the-difference-between-mediation-and-conciliation/?lang=en [Accessed 14 Aug.
2019].
16
Vietnam International Law Firm - Lawyer in Vietnam - Lawyer in Vietnam SB - Lawfirm in vietnam. (2019).
What is the difference between arbitration and conciliation?. [online] Available at: http://www.sblaw.vn/what-is-the-
difference-between-arbitration-and-conciliation/ [Accessed 14 Aug. 2019].
17
Supra 8.
18
Findlaw. (2019). What is Alternative Dispute Resolution? - FindLaw. [online] Available at:
https://hirealawyer.findlaw.com/choosing-the-right-lawyer/alternative-dispute-resolution.html [Accessed 14 Aug.
2019].

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 intrigue against such an decision lies under any court. On the off chance that the parties
are not happy with the decree of the Lok Adalat however there is no arrangement for an
intrigue against such an decision, yet they are allowed to start suit by moving toward the
court of fitting purview by recording a case by following the required strategy, in
exercise of their entitlement to the proceeding.19

There is no court expense payable when an issue is recorded in a Lok Adalat. On the off
chance that an issue pending in the courtroom is alluded to the Lok Adalat and is settled
along these lines, the court charge initially paid in the court on the grievances/appeal is
additionally discounted back to the parties. The people choosing the cases in the Lok
Adalats are known as the Members of the Lok Adalats, they have the job of statutory
conciliators , in this way they can just influence the parties to arrive at a resolution for
settling the dispute outside the court in the Lok Adalat and will not pressurize or force
any of the parties to bargain or settle cases or matters. The Lok Adalat will not choose the
issue so referred at the instance of the same, rather it will be decided as per the parties.
The individuals will help the parties in a free and fair-minded way in their endeavor to
arrive at friendly settlement of their dispute.

19
Nalsa.gov.in. (2019). Lok Adalat | National Legal Services Authority. [online] Available at:
https://nalsa.gov.in/lok-adalat [Accessed 25 Aug. 2019].

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 CHAPTER II
HOW TO UNDERSTAND THE NAURE OF ANY DISPUTE IN ADR?

To understand the nature of dispute under ADR, we need to understand how a dispute emerges.
On a regular basis there arises a number of disputes between the parties, groups, communities,
nations etc. There are differences of opinion, situational differences, cultural differences and
personality differences which when unresolved become disagreements and further lead to
problem and become dispute20.

Nature of dispute can be studied under three broad categories:

 The threat from which it is driven or originates (core of the dispute).

 What is the result of its escalation (dispute spiral).
 The dispute triangle.

Once we understand these we will be understand the nature of dispute.

CORE OF THE DISPUTE – At the core of every dispute there exists a sense of threat
concerning the parties. This sense of threat can be said to originate when there is danger to
physical safety ,religious membership , personal reputation, , psychological needs, professional
worth, social status, community concerns, financial security, human dignity or national pride etc
and by the time the parties decide to settle the dispute, they feel intimidated because of host of
mixed emotions each side has for the other such as fear, helplessness, frustration, suspicion,
embarrassment, hurt, humiliation, anger, distrust. If the parties fail to address these emotions
correctly the dispute remains unresolved.

THE DISPUTE SPIRAL - When a dispute reaches its peak, it tends to affect parties and the
decisions made by them also affecting the community, organizations etc and this outward
manifestation of the said tension between the parties is called the dispute spiral. This stress
which emanates from the dispute results in feelings of hostility, depression, anger, and can even
causes a feeling of vengeance in the relationship of the parties involved. Every small action of

20
Sci.gov.in. (2019). [online] Available at: https://sci.gov.in/pdf/mediation/MT%20MANUAL%20OF
%20INDIA.pdf [Accessed 10 Aug. 2019].

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the other party may become a cause to suspect. Parties might become rigid in their stance and it
might become difficult for each side to think clearly and this might even result in a deadlock of
the situation at hand. Therefore, the need of the parties is not just the addressing of the dispute
but also their emotions which ultimately – are at the backdrop of the decisions made by the
parties. Emotions varies from community to community and culture to culture and so does the
responses of the parties. Generally, the disputes resemble the emotions of its community and
culture and people tend to take side or leave when it comes to limelight. Even the families and
the communities tend to be polarized by the nature of the disputes. But it is not necessary that
solution in one part of a country might also be the one in another part. In the same way, solution
for a rural area might not be the one in the urban area etc. In this legal advice also plays a very
important role of affecting the decisions of the parties. By interacting and with the help of an
intermediary solutions can be arrived at. When a conflict comes into limelight each party make a
rigid stance and gather allies in their favor. Sometimes the dispute also gets out of the hand of
the protagonist and can even result in getting media attention which might further deteriorate the
situation between the parties.

DISPUTE TRIANGLE – It has the people, process and the problem on each side of the triangle
and it is the basis of all the disputes and we need to understand the same in order to understand
the nature of the dispute in ADR.

 People – Dispute always involve people who have different personal, cultural, religious
and social backgrounds and have their own persona, perceptions, relationships and
approaches towards different situations.
 Process - Every dispute differs in the way that they all have their own ways of
communication between the parties. Conflicts differ in the way each one intensifies,
spreads and gets defused or resolved.
 Problem - Each dispute has its own problem which may vary from dispute to dispute.

Also under the ADR and mediation rules following rule is relevant in the present context.

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“Rule 4: Court to give guidance to parties while giving direction to opt:

(a) Before directing the parties to exercise option under clause (b) of Rule 2, the Court shall give
such guidance as it deems fit to the parties, by drawing their attention to the relevant factors
which parties will have to take into account, before they exercise their option as to the particular
mode of settlement, namely:

(i) that it will be to the advantage of the parties, so far as time and expense are concerned, to opt
for one of these modes of settlement rather than seek a trial on the disputes arising in the suit;

(ii) that, where there is no relationship between the parties which requires to be preserved, it
will be in the interests of the parties to seek reference of the matter to arbitration as envisaged in
clause (a) of sub-section (1) of sec. 89.

(iii) that, where there is a relationship between the parties which requires to be preserved, it will
be in the interests of parties to seek reference of the matter to conciliation or mediation, as
envisaged in clauses (b) or (d) of sub-section (1) of sec. 89. Explanation: Disputes arising in
matrimonial, maintenance and child custody matters shall, among others, be treated as cases
where a relationship between the parties has to be preserved

(iv) that, where parties are interested in a final settlement which may lead to a compromise, it
will be in the interests of the parties to seek reference of the matter to judicial settlement
including Lok Adalat as envisaged in clause (c) of sub-section (1) of section 8921”

Arbitration is particularly reasonable for disputes when a neutral person with a profound
knowledge and learning of the topic of the dispute is required, or where the parties' business
relationship makes the exposure and custom of the court unsatisfactory. Mediation is reasonable
for any issues equipped for being settled by exchange between the parties, particularly for
disputes where the parties have or have had a business, expert or individual relationship. It is
utilized for business, common, work, family, between close to home, network and a wide-scope
of different disputes.22

21
Lawcommissionofindia.nic.in. (2019). [online] Available at: http://lawcommissionofindia.nic.in/alt_dis.pdf
[Accessed 10 Aug. 2019].
22
Manupatrafast.com. (2019). Manupatra Articles. [online] Available at:
http://www.manupatrafast.com/articles/PopOpenArticle.aspx?ID=192726ff-4a3c-4cec-874a-
b8134699f9e6&txtsearch=Subject:%20Miscellaneous [Accessed 12 Aug. 2019].

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 CHAPTER III
RECENT DEVELOPMENTS IN THE FIELD OF UNDERSTANDING THE NATURE
OF ADR

In last few years the field of ADR has been going through a metamorphosis. This transformation
is an effect and influence of national and International activities across the globe.

In order to provide modes for quicker resolution of disputes and to significantly reduce the
burden of civil courts, Section 89 of the CPC was brought in place. It empowers civil courts a
matter to refer parties to arbitration or any other form of ADR so that the disputes may get
resolved earlier. While exercising this discretion, the civil courts need to look at the nature of
issues involved and decide if the issues can be involved or are of such nature that are capable of
being resolved through ADR modes provided under the section.

Referring to the Supreme Court case of Afcons Infrastructure Ltd. and Anr. V Cherian Varkey
Construction Co. (P) Ltd. and Others23 dated 26th July 2010, the Hon’ble SC held:

"The following categories of cases are normally considered to be not suitable for Arbitration or
Conciliation [ADR process]:

i. Representative suits under Order 1 Rule 8 CPC which involves public interest or interest
of numerous persons who are not parties before the court. (In fact, even a compromise in
such a suit is a difficult process requiring notice to the persons interested in the suit,
before its acceptance).

ii. Disputes relating to election to public offices (as contrasted from disputes between two
groups trying to get control over the management of societies, clubs, association etc.).

iii. Cases involving grant of authority by the court after enquiry, as for example, suits for
grant of probate or letters of administration.

iv. Cases involving serious and specific allegations of fraud, fabrication of documents,
forgery, impersonation, coercion etc.

23
(2010) 8 SCC 24.

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 v. Cases requiring protection of courts, as for example, claims against minors, deities and
mentally challenged and suits for declaration of title against government.

vi. Cases involving prosecution for criminal offences."

"All other suits and cases of civil nature in particular the following categories of cases (whether
pending in civil courts or other special Tribunals/Forums) are normally suitable for ADR
process:

i. All cases relating to trade, commerce and contracts,

ii. All cases arising from strained or soured relationships,

iii. All cases where there is a need for continuation of the pre-existing relationship in spite
of the disputes;

iv. All cases relating to tortious liability; and

v. All consumer disputes."

The Supreme Court further held that "the aforementioned enumeration of 'suitable' and
'unsuitable' category of cases is not intended to be exhaustive or rigid. They are only
illustrative."

The Supreme Court in the landmark case of Salem Advocate Bar Association T.N. vs. Union of
India24 dealt with the issue of conflict between Section 89 and Order 10 Rule 1 A and observed
that section 89 uses both ‘shall’ and ’may’ however Order 10 rule 1A uses only the term ‘may’
under section 89. Hence on harmonious construction it can be harmoniously contructed that use
of word ‘may’ in section 89 only covers or governs the area of reformulation of the terms of a
possible settlement and matters in reference to one of the ADR methods. 25The Sc further held
that courts are not involved in the mediation or conciliation process however once the parties
reach a consensus mediator has to report the Court and then the court will pass such decree as per
the consensus reached after hearing both the parties. The court is not referred from hearing the

24
(2005), 6 SCC 344.
25
Ibid. para 54 and 55.

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matters it refers to ADR and parties need not incur extra costs for following ADR methods.
However, the existing situation is contrary to the Courts observation.

On the matters related to Fraud:

The Hon’ble Supreme Court in Maestro Engineers26 case in an appeal emanating from an
application made under Section 8 of ACA 27. In this case the defendants applied to the court to
refer the parties to arbitration in light of a pre-existing arbitration agreement and the Court
contended that it has powers to refuse to grant the application if it is of the opinion that the issues
raised involve allegations of fraud and such allegations will not be possible to be resolved by
arbitral tribunal.

In the Afcons Infrastructure28 case, the Supreme Court held that “under Section 89 of CPC it is
ascertaining whether it is feasible to have recourse mandatory for a civil court to have a
hearing, after the completion of pleadings, for the purpose of to refer parties to Arbitration or
Conciliation.” [ADR Process]. However, the Supreme Court clearly outlined and said that it is
not mandatory to refer the Parties to any ADR process in every case. If the case falls under the
excluded category, then there is no need not of reference to any ADR Process otherwise
reference of cases to ADR process is a must.

On consent of parties:

Court referring to the consent of the parties held that “a civil court, exercising power under
Section 89 of CPC, cannot refer a suit to arbitration unless all the parties to the suit agree for
such reference.”29

Similarly in the case of Jagdish Chander v. Ramesh Chander30, the Supreme Court had held that:

“It should not also be overlooked that even though Section 89 of CPC mandates courts to refer
pending suits to any of the several alternative dispute resolution processes mentioned

26
N Radhakrishnan case v Maestro Engineers & Ors (2010) 1 SCC 72.
27
Arbitration and Conciliation Act, 1996.
28
Afcons Infrastructure and Ors. v. Cherian Verkay Construction and Ors. 2010 (8) SCC 24.
29
K. S. Ravichandran, Published on 19 July 2011 Parties Must Agree To Have Their Disputes Resolved Through
Arbitration – Even Under Section 89 Of CPC [Accessed on 21 Aug. 2019]
30
2007 (5) SCC 719.

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therein,  there cannot be a reference to arbitration even under Section 89 of CPC, unless there
is a mutual consent of all parties, for such reference.”

This clearly shows that existence of consent of parties is a pre-condition to referring a dispute to
an arbitration. Even if reference made under section 89 of CPC arbitration cannot be thrust upon
the parties.

At the end of the Arbitration Process we receive an award and Parties are bound to abide by it. It
is enforceable as if it were a decree of a court. 31 Such legal position is not subject to change even
the parties find award not palatable.

An Arbitration commences with the prior consent of all parties. Arbitration brings an end to the
dispute. Arbitrators do not require the consent of the parties for issuing a legally binding award
the parties, unlike conciliation process. This clearly brings out the legislative intent behind party
consent at the reference stage. There have been recent amendments 32 made in the year 2019 to
make the Arbitration procedure smooth, reliable, convenient and more effective form of dispute
resolution.33

Disputes under the Commercial Courts Act, 2015:

India has been infamous for its overburdened legal system and indefinite delays in the disposal
of cases. India being a leading economy has been a great destination for trade and foreign as well
as domestic investors. However, one of the biggest difficulties in resolving disputes related to
such investments. This could not escape even courts attention. In in the famous case of White
Industries Australia Ltd. vs Union of India 34, the court opined that inordinate delays in the legal
process is a breach of investment treaty obligation by India.

There was a long pending requirement for an efficient, speedy and reliable dispute resolution
system as well as quick enforcement of contracts, recovery of claims and award of compensation
for damages. This was essential for strengthening the economic activity in the country.35

31
S. 36 of the ACA.
32
Vidya Drolia & Ors. vs. Durga Trading Corporation Civil Appeal No.2402 Of 2019.
33
Ibid.
34
IIC 529 (2011).
35
Introduction Of Commercial Courts: End Of Endless Litigation, Nishith Desai Associates, Research and Articles,
October 29, 2015 [Accessed on 21 Aug. 2019].

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To improve India’s image as an investment destination, the Commercial Courts, Commercial
Division and Commercial Appellate Division of High Courts Ordinance, 2015 (“Ordinance”)
was passed and received Presidential assent on 23 October, 2015. The Ordinance was passed in
accordance with the global trend and demands, backed by the in-depth study of Commercial
Courts of UK, USA and Singapore, etc., which was extensively studied by the Law Commission
of India (“Commission”) in its 188th report36 and 253rd report37.

The Act provided the Commercial Courts jurisdiction to try all suits and applications relating to
a Commercial Dispute5 of a Specified Value.6 As per the Act any Suit or application filed before
the High Court having original civil jurisdiction shall be brought in the Commercial Division of
the said High Court.

The term “Commercial Disputes” has been defined under section 2(c) of the Commercial Courts
Act is very wide and in fact covers every comm. transaction covering “general commercial
contracts, shareholder & joint venture agreements, intellectual property rights, contracts
relating to movable and immovable property, natural resources”, etc.

Further the Act defined the term “Specified Value” under section 2(j) the Act, it provides the
value of the subject matter in a suit to be tried by the Commercial Courts which was earlier 10
lakh Indian rupees which has been reduced to 3,00,000 as per the 2019 amendment. The
intent behind such segregation of Commercial Disputes on the basis of a given Specified Value
is to ensure that these selected disputes are efficiently and speedily resolved by the Special
Courts.38

CONCLUSION

36
Available at: http://lawcommissionofindia.nic.in/reports/188th%20report.pdf.
37
Available at: http://lawcommissionofindia.nic.in/reports/Report_No.253 Commercial Division and Commercial
Appellate Division of High Courts and Commercial Courts Bill. 2015.pdf.
38
Ibid.

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The authors have found that there are different forms of ADR present in India. The oldest source
of ADR is Section 89 of CPC. This section has its own history and suffered with inherent flaws.
One of the other issues was importation of the Section. There are multiple legislations regulating
and providing ADR mechanisms. One of the most tedious tasks in ADR is selection of right
ADR method or medium for dispute resolution. Different modes and legislations deal with
different form of ADR. Not defining “dispute” within the statutes leads to chaotic condition
while selecting the right mode of ADR. The Mediation Rules of Supreme Court and the
Commercial Courts have attempted to exhaustively define “dispute”. Further the judicial
interpretations, Commissions have furthered clarified the nature of disputes under different
modes of ADR. The authors have found that the Disputes Triangle is one of the most convenient
ways to understand nature of disputes. The authors have also found that there is a need for
promotion of different forms of ADR. This will help the Parties and general public to choose the
right mode of ADR. There is also need for promotion and create awareness among the legal
fraternity as well to make ADR mechanisms more effective in our country. Government also has
a key role to play inform of bringing more ADR progressive laws and provide platforms for
independent ADR mechanisms. The recent developments in the arbitration law is expected to
help India to become a global hub for effective and speedy dispute resolution. However, the
authors believe that still there is a long way to go as we need to bring theory to reality.

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 BIBLIOGRAPHY

BOOKS

ADR Principles and Practice, Henry Brown and Arthur Mariott, Sweet & Maxwell, (3rd Edn.)
[2013].

Alternative Dispute Resolution; A conflict Diagnosis Approach, Laurie S. Coltri, Pearson (2nd
Edn). [2010].

ADR along with Gram Nyayalayas Act, Sukumar Ray, Eastern law House [2012].

Arbitration & ADR, Dr. U. Pattabhi Ramiah, Asia Law House, [2011].

Alternative Dispute Resoltion: A Developing World Perspective, Albert Fiajdoe, , Routledge

Cavendish [2004].

ARTICLES

Christoph Greggersen, What is conciliation? - Dispute Resolution Hamburg, (2019). [online]

Dispute-resolution-hamburg.com. Available at: http://www.dispute-resolution-
hamburg.com/conciliation/what-is-conciliation/ [Accessed 14 Aug. 2019].

Alessandra Sgubini, M. (2019). Arbitration, Mediation and Conciliation: differences and

similarities from an International and Italian business perspective. [online] Mediate.com.
Available at: https://www.mediate.com/articles/sgubiniA2.cfm [Accessed 14 Aug. 2019].

Alternate Dispute Resolution (ADR) In India - Litigation, Mediation & Arbitration - India.
[online] Available at:
http://www.mondaq.com/india/x/654324/court+procedure/Alternate+Dispute+Resolution+ADR
+In+India. [Accessed 10 Aug. 2019]

What is Arbitration?. Mediate.com [online] Available at:

https://www.mediate.com/articles/grant.cfm [Accessed 14 Aug. 2019].

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Know ADR and Difference Between Arbitration, Conciliation And Mediation By Nisha Shaw.
[online] Available at: https://blogs.compliancecalendar.in/know-adr-and-difference-between-
arbitration-conciliation-and-mediation-by-nisha-shaw-440. [Accessed 14 Aug. 2019].

How arbitration, mediation and conciliation are different from each other iPleaders. (2019) by
Abhinav Malhotra, 13 April 2018. [online] Available at: https://blog.ipleaders.in/arbitration-
mediation-and-conciliation-different/ [Accessed 14 Aug. 2019].

LEGISLATIONS

 Arbitration and Conciliation Act, 1996.

 Arbitration and Conciliation Amendment Act, 2015.
 Arbitration and Conciliation Amendment Act, 2019.
 Lok Adalat Act, 1987.
 Commercial Courts Act, 2015.
 Mediation Training Manual of India, Supreme Court.
 CPC 1908.

WEBSITES

 http://www.mondaq.com
 barandbench.com
 http://www.nishithdesai.com
 www.prsindia.org
 http://www.legalserviceindia.com
 http://www.kluwerarbitration.com
 Manupatrafast.in
 Sci.gov.in
 Ipleaders.com
 Lawcommissionofindia.com
 Findlaw.com
 Investopedia.in

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