Arbitration is a method of settlement of disputes as an alternative to the normal judicial

method. It is one of the methods of alternative dispute resolution (ADR). Of all the forms of
ADR like conciliation, mediation, negotiations, etc., arbitration has become the dominant
form of ADR. It is more firmly established in its utility. Alternative Dispute Resolution was
conceived of as a dispute resolution mechanism outside the court of law established by the
Sovereign or the State. ADR can be defined as a collective description of process or
mechanisms that parties can use to resolve disputes rather than bringing a claim through the
formal court structure. ADR is a part of civil justice system with the United Kingdom. It is a
key aspect of the civil justice system and has grown over the past forty years.

The law relating to arbitration is contained in the Arbitration and Conciliation Act, 1996. It
came into force on the 25th of January, 1996. It provides for domestic arbitration, international
commercial arbitration and also enforcement of foreign arbitral awards. It also contains the
new feature on conciliation. Like arbitration, conciliation is also getting increasing worldwide
recognition as an instrument for settlement of disputes. However, with the passage of time,
the phrases “Arbitration and ADR” came in vogue, which implied that arbitration was distinct
from other ADR forms.