Dispute resolution outside of courts is not new; societies world-over have long
used non-judicial, indigenous methods to resolve conflicts. What is new is the
extensive promotion and proliferation of Alternative Dispute Resolution (ADR)
models, wider use of court-connected ADR, and the increasing use of ADR as a
tool to realize goals broader than the settlement of specific disputes.
Alternate Dispute Resolution system is not a new experience for the people of
this country also. It has been prevalent in India since time immemorial. Legal
history indicates that down the ages man has been experimenting with procedure
for making it easy, cheap, unfailing and convenient to obtain
justice. Procedure for justice is indicative of the social consciousness of
the people. Anywhere law is a measuring rod of the progress of the community.
Ancient system of dispute resolution made a considerable contribution, in
reaching resolution of disputes relating to family, social groups and also minor
disputes relating to trade and property. Village level institutions played the
leading role, where disputes were resolved by elders, comprising Council of
Village, which was an informal way of mediation. In earlier days disputes
hardly reached courts. Decisions given by the elderly council were respected by
all. But subsequently boon accompanied bane, the very system lost its impression
due to intervention of political and communal elements.
ADR During British Period
The British East India Company opened their first trading Centre at Surat,
Gujarat in 1612. This was as per the deed of right Mughal Emperor Jehangir
granted to them. Their first major interference with the internal politics of
India was when they supported Mir Kasim, a minister of Bengal, militarily to
sabotage Siraj-ud-Daula, the Nawab. On 23rd June, 1757, the Nawab was defeated
by a joint military action of Robert Clive's troops and those of Mir Kasim in a
battle at Plassey.
And this was the turning point where the British formally
entered the political arena of India and began to play a direct role in the
administrative supremacy. They managed to bring under their administrative
control most of the princely states of India either by direct annexation using
force or by giving military support. They brought Punjab also under their
control in 1849.
Along with Punjab, the North West Frontier Province, which is
now under Pakistan, was also brought under them. And in those states where a
legitimate heir apparent to the crown was not available they were brought under
the British rule. Sattara (1848), Udaypur (1852), Jhansi (1853), Tanjore (1853),
Nagpur (1854), Oudh (1856) were some of the princely states the British annexed
using this excuse - that there were no legitimate heir apparent. When Tipu
Sultan was defeated in 1792, they annexed Malabar too.
Judicial administration was changed during British period. The current judicial
system of India is very close to the judicial administration as prevailed during
British period. The traditional institutions worked as recognised system of
administration of justice and not merely alternatives to the formal justice
system established by the British. The two systems continued to operate parallel
to each other. The system of alternate dispute redressal was found not only
as a convenient procedure but was also seen as a politically safe and
significant in the days of British Raj.
However, with the advent of the British Raj these traditional institutions of
dispute resolution somehow started withering and the formal legal system
introduced by the British began to rule. ADR in the present form picked up
pace in the country, with the coming of the East India Company. Modern
arbitration law in India was created by the Bengal Regulations. The Bengal
Regulations of 1772, 1780 and 1781 were designed to encourage
Bengal Resolution Act, 1772 and Bengal Regulation Act, 1781
provided parties to submit the dispute to the arbitrator, appointed after mutual
agreement and whose verdict shall be binding on both the parties. Hence, there
were several Regulations and legislation that were brought in resulting
considerable changes from 1772.
After several Regulations containing provisions
relating to arbitration Act VIII of 1857 codified the procedure of Civil Courts
except those established by the Royal Charter, which contained Sections 312 to
325 dealing with arbitration in suits. Sections 326 and 327 provided for
arbitration without the intervention of the court.
After some other provisions from time to time Indian Arbitration Act,1899 was
passed, based on the English Arbitration Act of 1889. It was the first
substantive law on the subject of arbitration but its application was limited to
the Presidency - towns of Calcutta, Bombay and Madras. Act, however suffered
from many defects and was subjected to severe judicial criticisms. In 1908 the
Code of Civil Procedure (CPC) was re-enacted.
The Code made no substantial
changes in the law of arbitration. The Arbitration Act of 1940 was enacted
replacing the Indian Arbitration Act of 1899 and section 89 and clauses (a) to
(f) of section 104(1) and the Second Schedule of the Code of Civil Procedure,
1908. It amended and consolidated the law relating to arbitration in British
India and remained a comprehensive law on Arbitration even in the Republican
India until 1996.
ADR Post Independence
Bodies such as the panchayat, a group of elders and influential persons in a
village deciding the dispute between villagers are very common even today. The
panchayat has, in the recent past, also been involved in caste disputes. In 1982
settlement of disputes out of courts started through Lok Adalats. The first Lok
Adalat was held on March 14, 1982 at Junagarh in Gujarat and now it has been
extended throughout the country. Initially, Lok Adalats functioned as a
voluntary and conciliatory agency without any statutory backing for its
By the enactment of the Legal Services Authorities Act, 1987, which
came into force from November 9, 1995, the institution of Lok Adalats received
statutory status. To keep pace with the globalization of commerce the old
Arbitration Act of 1940 is replaced by the new Arbitration and Conciliation Act,
Settlement of matters concerning the family has been provided under Order XXXIIA of the Code of Civil Procedure, 1908 by amendment in 1976. Provisions for
making efforts for reconciliation under Sections 23 (2) and 23 (3) of the Hindu
Marriage Act, 1955 as also under Section 34 (3) of the Special Marriage Act,
1954 are made.
Family Courts Act was enacted in 1984. Under Family Courts Act,
1984 it is the duty of family court to make efforts for settlement between the
parties. Introduction of section 89 and Order X Rule 1A, 1B and 1C by way of an
Amendment in the Code of Civil Procedure, 1908 is a radical advancement made
by the Indian Legislature in embracing the system of "Court Referred Alternative
Analysis on Evolution of ADR Mechanisms in Indian Judiciary
The Law Commission of Indian has maintained that, the reason for judicial delay
is not a lack of clear procedural laws, but rather the imperfect execution, or
even utter non-observance, thereof. The Law Commission of Indian in its
14th Report categorically stated that, the delay results not from the procedure
lay down by the legislations but by reason of the non-observance of many of its
important provisions particularly those intended to expedite the disposal of
Given the huge number of pending cases, the governance and
administrative control over judicial institutions through manual processes has
become extremely difficult. The Supreme Court made it clear that this state of
affairs must be addressed: "An independent and efficient judicial system is one
of the basic structures of our Constitution� It is our Constitutional obligation
to ensure that the backlog of cases is decreased and efforts are made to
increase the disposal of cases."
The analysis of the Law Commission of India reports sheds light on the factors
contributing towards delays and huge backlog of cases before the Courts. The
prominent contributory factors are the frequent adjournments at the instance of
the clients and lawyers, the boycotts of the Courts by the lawyers, shortage
of presiding officers of the Tribunals and Courts, lack of adherence to
basic procedures and principles of case management and disposal.
Government is also known to be a huge contributor to delays, in matters where it
is a party at various stages from evading notices, replying to notices and
replying without application of mind, unnecessarily appealing even when the laws
are clearly in favour of the other side. The improper management of Court
diary, absence of strict compliance with the provisions of Code of Civil
Procedure such as, provisions of the Order 10 Code of Civil Procedure relating
to examination of parties before framing issues, to ensure narrowing and
focusing the area of controversy, the laxity in enforcing the provisions of
Order 8, R 1, Code of Civil Procedure by allowing repeated adjournments with
Order 17, Rule 1, Code of Civil Procedure to be read with the proviso to Order
17, Rule 2 where Clause (b) for giving adjournments also are the prominent
contributors to the problem of delays and the resultant judicial arrears.
Code of Civil Procedure (Amendment Act) 2002, Act No.22 was sought to bring a
change in the procedure in suits and civil proceedings by way of reducing delays
and compressing them into a year's time from institution of suit till disposal
and delivery of judgment, yet the revised procedures are also not strictly
As a result, the time taken in the final disposal of the cases by
the Courts still runs into years by unduly lengthy and winded examination and
cross examination of witnesses, protracted arguments, inadequate
electronic connectivity and use of information technology and so forth. The
problem judicial delay and judicial arrears are spreading like epidemic at every
level of the judicial system and thus it is a major cause of concern for the
very survival of the entire process of litigation.
ADR was at one point of time considered to be a voluntary act on the apart of
the parties which has obtained statutory recognition in terms of Code of Civil
Procedure (Amendment) Act 1999, Arbitration and Conciliation Act 1996, Legal
Services Authorities Act, 1997 and Legal Services Authorities (Amendment) Act,
2002. The Parliament apart from litigants and the general public as also the
statutory authorities Like Legal Services Authority have now thrown the ball
into the court of the judiciary.
What therefore, now is required would be
implementation of the Parliamentary object. The access to justice is a human
right and fair trial is also a human right. In some countries trial within a
reasonable time is a part of the human right legislation. But, in our country,
it is a Constitutional obligation in terms of Article 14 and 21. Recourse to
alternative dispute resolution as a means to have access to justice may,
therefore, have to be considered as a human right problem. Considered in that
context the judiciary will have an important role to play.
Even before the existence of Section 89 of the Civil Procedure Code, there were
various provisions that gave the power to the courts to refer disputes to
mediation, which sadly have not really been utilized. Such provisions, inter
alia, are in the Industrial Disputes Act, the Hindu Marriage Act and the Family
Courts Act and also present in a very nascent form via Section 80, Order 32 A
and Rule 5 B of Order 27 of the Code of Civil Procedure. A trend of this line of
thought can also be seen in ONGC vs. Western Co. of Northern
 and ONGC vs. Saw Pipes Ltd.
Industrial Disputes Act, 1947
provides the provision both for conciliation and arbitration for the purpose of
settlement of disputes. Section 23(2) of the Hindu Marriage Act, 1955 mandates
the duty on the court that before granting relief under this Act, the Court
shall in the first instance, make an endeavour to bring about a reconciliation
between the parties, where it is possible according to nature and circumstances
of the case.
For the purpose of reconciliation the Court may adjourn the proceeding for a
reasonable period and refer the matter to person nominated by court or parties
with the direction to report to the court as to the result of the
The Family Court Act, 1984 was enacted to provide for the establishment of
Family Courts with a view to promote conciliation in, and secure speedy
settlement of, disputes relating to marriage and family affairs and for matter
connected therewith by adopting an approach radically different from that
ordinary civil proceedings.
Section 9 of the Family Courts Act, 1984 lays
down the duty of the family Court to assist and persuade the parties, at first
instance, in arriving at a settlement in respect of subject matter. The Family
Court has also been conferred with the power to adjourn the proceedings for any
reasonable period to enable attempts to be made to effect settlement if there is
a reasonable possibility.
Section 80(1) of Code of Civil Procedure lays down that no suit shall be
instituted against government or public officer unless a notice has been
delivered at the government office stating the cause of action, name, etc. The
object of Section 80 of Code of Civil Procedure - the whole object of serving
notice u/s 80 is to give the government sufficient warning of the case which is
of going to be instituted against it and that the government, if it so wished
can settle the claim without litigation or afford restitution without recourse
to a court of laws.
The object of section 80 is to give the government the
opportunity to consider its or his legal position and if that course if
justified to make amends or settle the claim out of court. Order 23 Rule 3
of Code of Civil Procedure is a provision for making a decree on any lawful
agreement or compromise between the parties during the pendency of the suit by
which claim is satisfied or adjusted.
The scheme of Rule 3 of Order 23 proves
that if the court is satisfied that a suit has been adjusted wholly or partly by
and lawful agreement or compromise, the court shall pass a decree in accordance
to that. Order 23, Rule 3 gives mandate to the Court to record a lawful
adjustment or compromise and pass a decree in term of such compromise or
Order 27 Rule 5B confers a duty on court in suit against the government or a
public officer to assist in arriving at a settlement. In a suit where Government
or public officer is a party it shall be the duty of the Court to make an
endeavour at first instance, where it is possible according to the nature of the
case, to assist the parties in arriving at a settlement. If it appears to the
court in any stage of the proceedings that there is a reasonable possibility of
a settlement, the court may adjourn the proceeding to enable attempts to be made
to effect settlement.
Order 32A of Code of Civil Procedure lays down the provision relating to "suits
relating to matter concerning the family". It was felt that ordinary judicial
procedure is not ideally suited to the sensitive area of personal relationships.
Litigations involving affairs of the family seem to require special approach in
view of the serious emotional aspects involved.
In this circumstances, the
objective of family counselling as a method of achieving the object of
preservation of family should be kept in forefront. Therefore, Order 32A seeks
to highlight the need for adopting a different approach where matters concerning
the family are at issue, including the need for effort to bring about amicable
settlement. The provisions of this Order applies to all proceedings relating to
family, like guardianship, custody of minor, maintenance, wills, succession,
Rule 3 imposes a duty on the Court to make an effort of settlement by way
of providing assistance where it is possible to do so. The Court may also
adjourns the proceeding if it thinks fir to enable attempt to be made to effect
a settlement where there is a reasonable possibility of settlement. In discharge
of this duty Court may take assistance of welfare expert who is engaged in
promoting the welfare of the family.
The concept of employing alternative dispute resolution has undergone a sea
change with the insertion of S.89 of Code of Civil Procedure by amendment in
2002. As regards the actual content, s.89 of Code of Civil Procedure lays down
that where it appears to the court that there exists element of settlement,
which may be acceptable to the parties, the Court shall formulate the terms of
the settlement and give them to the parties for their comments.
On receiving the
response from the parties, the Court may formulate the possible settlement and
refer it to either - Arbitration, Conciliation; Judicial Settlement including
settlement through Lok Adalats; or Mediation. As per sub-section (2) of Section
89, when a dispute is referred to arbitration and conciliation, the provisions
of Arbitration and Conciliation Act will apply. When the Court refers the
dispute of Lok Adalats for settlement by an institution or person, the Legal
Services Authorities, Act, 1987 alone shall apply.
Supreme Court started issuing various directions as so as to see that the public
sector undertakings of the Central Govt. and their counterparts in the States
should not fight their litigation in court by spending money on fees on counsel,
court fees, procedural expenses and waiting public time.
In ONGC vs. Collector of Central Excise
, there was a dispute between the
public sector undertaking and Government of India involving principles to be
examined at the highest governmental level. Court held it should not be brought
before the Court wasting public money any time.
In ONGC vs. Collector of Central Excise
, dispute was between government
department and PSU. Report was submitted by cabinet secretary pursuant to
Supreme Court order indicating that an instruction has been issued to all
departments. It was held that public undertaking to resolve the disputes
amicably by mutual consultation in or through or good offices empowered agencies
of govt. or arbitration avoiding litigation. Government of India directed to
constitute a committee consisting of representatives of different departments.
To monitor such disputes and to ensure that no litigation comes to court or
tribunal without the Committee's prior examination and clearance. The order was
directed to communicate to every High Court for information to all subordinate
In Chief Conservator of Forests vs. Collector
 it was said that State/ Union
government must evolve a mechanism for resolving interdepartmental
controversies- disputes between department of Government cannot be contested in
In Punjab & Sind Bank vs. Allahabad Bank
, it was held that the direction of
the Supreme Court in ONGC III to the government to setup committee to
monitor disputes between government departments and public sector undertakings
make it clear that the machinery contemplated is only to ensure that no
litigation comes to court without the parties having had an opportunity of
conciliation before an in-house committee.
In the judgment of the Supreme Court of India in Salem Bar Association vs. Union
of India, the Supreme Court has requested prepare model rules for
Alternative Dispute Resolution and also draft rules of mediation under section
89(2)(d) of Code of Civil Procedure, 1908. The rule is framed as "Alternative
Dispute Resolution and Mediation Rules, 2003".
Rule 4 of the Alternative Dispute Resolution and Mediation Rules, 2003, lays
down that the Court has to give guidance to parties (when parties are opting for
any mode of Alternative Dispute Resolution) by drawing their attention to the
relevant factors which parties will have to take into account, before they
exercise their opinion as to the particular mode of settlement, namely;
- 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;
- where there is no relation 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 (1) of sub-section (1) of
- where there is a relationships between the parties which requires to be
preserved, it will be in the interests of the parties to seek reference of
the matter to conciliation or mediation, as envisaged in clauses (b) or (d)
of sub-section (1) of section 89.
The Rule also says that Disputes are 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.
- 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 89.
According to Rule 8, the provisions of these Rules may be applied to proceedings
before the Courts, including Family courts constituted under the Family Courts
(66 of 1984), while dealing with matrimonial, and child custody disputes.
The Supreme Court in Afcons Infrastructure and Ors. vs. Cherian Verkay
Construction and Ors., changed the course of arbitration proceedings in
India in addition to Salem Advocate Bar Association case. The scope and
interpretation of Section 89 of CPC, 1908, suitability and unsuitability of
arbitration for various disputes, consent of parties to the suit for
arbitration, mandatoriness or voluntariness of ADR process and many other
co-related issues were largely settled by the apex court burying the hatchet
once and for all. The Afcons case thus put an end to most of the debatable
issues that were a bone of contention in ADR mechanism.
There is need for greater use of Alternative Dispute Resolution. It is required
when there is need for:
- going into lesser depth of procedures, or more informal and less technical
procedures, or special procedures;
- the decision-maker or facilitator to be familiar with the or otherwise
conversant with the subject. In many technical matters, it eliminates the
need to give evidence or even 'educate' the decision-maker thereby enabling
lesser costs, and greater speed and accuracy; and
- adopting and encouraging 'give and take' by each.
This occurs in many situations, particularly where reasoning/ moral
justification advanced by one is likely to persuade the other to more readily
relent. It is wrong to send parties to alternative dispute resolution simply
because the courts are not able to decide the cases in a reasonable time. The
principle behind alternative dispute resolution as also the need thereof must be
understood in its correct perspective.
To emphasize further, pressing for
alternative dispute resolution systems without first resolving the problem of
delays before the courts is only driving people to alternative dispute
resolution out to helplessness and giving them a feeling that:
It takes so long
for the court to decide and the cost of attending to all the hearings is so much
that it is as good as justice denied. So whatever little alternative dispute
resolution has to offer, we might as well accept, and more than that, we cannot
Although alternative dispute resolution systems are essential, and
great attention and effort must go towards them to make successful, it is
necessary that apart from many other factors, improvement in the functioning of
the courts is brought first. Thereafter alternative dispute resolution be
encouraged, but confined to matters where it is more suitable/ appropriate as
compared to the 'efficient and proper' court procedures. It should not merely be
regarded as an escape route form the inability of the courts to dispense justice
India has a long history of settlement of disputes outside the formal justice
delivery system. The concept of parties settling their disputes by reference to
a person or persons of their choice or private tribunals was well known to
ancient India. Long before the king came to adjudicate on disputes between
persons such disputes were quite peacefully decided by the intervention of
the kulas, srenis, pugas and such other autonomous bodies.
institutions worked as main means of dispute resolution, not an alternative.
During the British rule the system of dispute resolution was changed and a new
formal, adversary system of dispute resolution originated. Arbitration was recognised as out of court method of dispute resolution and several provisions
were enacted relating to that. The ADR system as is understood in the present
scenario is the result of the shortcomings of that formal judicial system.
Now, the alternative disputes resolution techniques are being used to avoid the
costs, delays and cumbersome procedure of the formal courts. The Indian
government has started to incorporate the alternative disputes resolution
techniques in most of their newly enactments such as The Commercial Courts Act,
2015 and The Real Estate (Regulation and Development) Act, 2016. The
Mediation Bill 2021, which was introduced in Rajya Sabha on 20th December last
year, is a big step for promoting the Alternative Disputes Resolution system in
"Persuade your neighbours to compromise whenever you can. Point out to them how
the nominal winner is often a real loser - in fees, expenses, and waste of time.
As a peacemaker the lawyer has a superior opportunity of being a good man. There
will still be business enough."- Abraham Lincoln
- Supakar, Dr. Shraddhakara. (1986). Law of Procedure and Justice in Ancient
India. New Delhi : Deep & Deep Publication.
- Popularly called as Panchayats.
- Also known as the Tiger of Mysore, was the ruler of the Kingdom of Mysore
and a pioneer of rocket artillery
- Chandra, Sarvesh. ADR: Is Conciliation the Best Choice, in Rao, P.C. and
Sheffield, William. (1997) Alternative Dispute Resolution: What it is and How it
Works, New Delhi : Universal Law Publishing Co., p. 85.
- Reddy, K. Jayachandra. Alternate Dispute Resolution, in Rao, P.C. and
Sheffield, William. (1997) Alternative Dispute Resolution: What it is and How it
Works, New Delhi : Universal Law Publishing Co., p. 79.
- Nripendra Nath Sircar, Law of Arbitration in British India (1942), p. 6
cited in 76'th Report of Law Commission of India, 1978, p. 6, para 1.14
- Act 46 of 1999, section 20 (i) (w.e.f. 1-7-2002).
- Law Commission of India, 77th Report, pr.4.1.
- As per the economic times' report, there are 58.94 lakh cases pending in
High Courts and more 4.10 crore cases pending in the district and subordinate
courts across the country, as on 21st March, 2022. As per the website of Supreme
Court of India there are 70,632 cases pending, as on 01st April 2022.
- Brij Mohan Lal vs. Union of India & Ors., (2002) 4 Scale 433, decided on
May 6th, 2002.
- Salem Advocate Bar Association, Tamil Nadu vs. Union of India, (2005) 6 SCC
- 120th Law Commission Report (1987).
- 77th Law Commission Report (1978).
- Tamil Nadu Vs. Union of India (UOI), (2005) 6 SCC 344, paras 38, 39.
- The 14th and 77th Law Commission Reports.
- 79th Law Commission Report (1979) on delays and arrears.
- ADR and Access to Justice: Issues and Perspectives, By Hon'ble Justice S.
B. Sinha, Judge Supreme Court of India.
- AIR 1987 SC 674
- AIR 2003 SC 2629.
- Section 23(3) of the 1966 Act
- K.A.Abdul Jalees v. T.A. Sahida (2003) 4 SCC 166.
- Ghanshyam Dass v. Domination of India, (1984) 3 SCC 46
- Raghunath Das v. UOI AIR 1969 SC 674.
- Rule 4 of Order 32A of CPC, 1908.
- see Oil and Natural Gas Commission vs. Collector of Central Excise [1992
Supp.2 SCC 432],
Oil and Natural Gas Commission vs. Collector of Central Excise [1995 Supp.4 SCC
Chief Conservator of Forests vs. Collector, [(2003) 3 SCC 472].
- 1992 Supp.2 SCC 432.
- 1995 Supp.4 SCC 541.
- (2003) 3 SCC 472.
- (2006) (3) SCALE 557.
- (2004) 6 SCC 437.
- (2005) 6 SCC 344
- 2010 (8) SCC 24
- Rao, P.C. Alternatives to Litigation in India, in Rao, P.C. and Sheffield,
William. (1997) Alternative Dispute Resolution: What it is and How it Works, New
Delhi : Universal Law Publishing Co., p.27.
- Section 12A.
- Section 32(g).
- An American Politician and Lawyer who served as the 16th President of
the United States from March 1861 until his assassination in April 1865.