Importance Of Alternative Dispute Resolution

885 Words4 Pages
Business disputes need speedy resolution. Litigation is the least favoured method of resolution for a variety of reasons – delay being the foremost. The Indian judicial system is marred by delays. Businesses suffer because disputes are not resolved in a reasonable time. It is fashionable to talk about ‘Alternative Dispute Resolution’ (ADR) methods like negotiation, mediation, conciliation, arbitration, etc. but out of these only arbitration is used frequently as a method of choice for business dispute resolution. All over the world, commercial arbitration has been hailed as the most efficient form of dispute settlement available to participants in international trade as Arbitral Tribunal is viewed by businesses as a neutral and cost-effective…show more content…
Over the last one and a half decades, after the liberalisation of Indian economy in 1991, business has grown exponentially. As business grew so did the disputes. Most of the business communities have their own very old, time-tested methods of dispute resolution which have nothing to do with the formal legal system. For instance, jewelers, commodity traders, farmers, artisans, craftsmen, money lenders, etc. have a well established method of resolution of disputes and it is mostly by negotiation or mediation by a well-known, highly reputed third party. The major problem is for the businesses where stakes are very high and formal documents – contracts, arbitration clause, bank guarantee, indemnity, etc. – have been prepared. The only recourse available is the regular legal system, which India inherited from the British. Since independence in 1947, a lot of changes have been made, still the core remains as the laws enacted – for instance the Penal Code, the Civil Procedure Code, the Evidence Act, the Contract Act, etc. – during the nineteenth century by the British. The Government – Federal and States – had a major role in development since independence and ironically has turned out to be the biggest litigant in India. This Part focuses on delay in dispensation of justice and experience of arbitration in business dispute resolution in India in recent…show more content…
But at the same time courts should avoid entertaining applications against the arbitration proceedings because the court proceedings delay the arbitral process and consequentially the objective of the arbitration gets defeated. Hence the courts which are exercising the supervisory powers should exercise the powers with caution so that the arbitral process does not get affected. The Arbitration and Conciliation Act, 1996 gives scope to the Courts only with respect to the following

More about Importance Of Alternative Dispute Resolution

Open Document