TABLE OF CONTENTS

1. International Perspective of Alternative Dispute Resolution

A. Introduction
B. International Perspective on ADR
C. International institution for ADR system
D. International Commercial Arbitration
E. The International Chamber of Commerce (ICC) Rules on Arbitration
F. Modes of ADR mechanism for settlement of International disputes
G. ADR system in various countries

2. Indian Perspective of Alternative Dispute Resolution

A. Introduction
B. Lok Adalat
C. Recent Amendments to the Arbitration and Conciliation Act, 1996
D. Conclusion

3. Case Studies
A. TATA Sons (P) Ltd. v. Siva Industries & Holdings Ltd. & Ors.
B. Gujarat Composite Limited v. A Infrastructure Limited & Ors.

4. Bibliography
 International Perspective of Alternative Dispute Resolution
Introduction:

Alternative Dispute Resolution is a generic term used to describe a range of procedures

designed to provide ways to resolving a dispute as an alternative to court procedures. It
means it is an alternative to litigation. Alternative Dispute Resolution (ADR) refers to a
variety of streamlined resolution techniques designed to resolve issues in controversy more
efficiently when the normal negotiation process fails. ADR had been used by human society
since ancient times though it gets wide acceptance and recognition in countries laws recently.
ADR methods, in comparison with court litigation, have various advantages though it is not
free from different short comings.

Alternative dispute resolution system is being increasingly acknowledged in field of law and
commercial sectors both at National and International levels. Its diverse methods can helps
the parties to resolve their disputes at their own terms cheaply and expeditiously. Desire for
quick and affordable justice is universal. The following are the wide ranges of objectives of
ADR are –

 ADR can support and complement court reform.

 ADR can by-pass ineffective or discredited courts.
 ADR can increase satisfaction of disputants with outcomes.
 ADR programs can increase access to justice for disadvantaged groups.
 ADR programs can reduce delay in the resolution of disputes.
 ADR programs can reduce the cost of resolving disputes.
ADR is consensual and aimed at reaching a mutually satisfactory solution. ADR can bring
specialized knowledge to the dispute which may be unavailable in conventional domestic
courts, although this advantage is less relevant for treaty arbitration in dedicated investment
tribunals. As with civil courts of many domestic legal systems, even specialized investment
arbitration facilities must adhere to a set of procedural rules, such as those regarding
evidence. These can be inflexible, removing control from the parties. While ADR
mechanisms vary, they are typically not tied to a fixed procedural framework because they
favour practical solutions that require compromise and negotiation. Furthermore, ADR
processes are likely to be less expensive than domestic courts or International arbitration
because as they are less legalized and do not require the establishment of liability, specialized
legal counsel will be un-necessary. In this sense ADR is much more accessible and practical
for use by civil society stakeholder groups in the developing world1.

ADR processes are often differentiated from each other also by the degree of control the third
party neutral has over both the process (the rules of proceedings) and the substance (decision,
advice, or facilitation) and the formality of the proceeding. ADR processes are being applied
increasingly to diverse kinds of conflicts, disputes, and transactions, some requiring expertise
in the subject matter (such as scientific and policy disputes) and spawning new hybrid

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processes such as ‗consensus building‘ which engage multiple parties in complex, multi-issue
problem solving, drawing on negotiation, mediation and other non-adjudicative processes
(Susskind et al. 1999)2.

Alternative Dispute Resolution (ADR) sometimes also called ―Appropriate Dispute

Resolution‖ is a general term, used to define a set of approaches and techniques aimed at
resolving disputes in a non-confrontational way. It covers a broad spectrum of approaches,
from party-to-party engagement in negotiations as the most direct way to reach a mutually
accepted resolution, to arbitration and adjudication at the other end, where an external party
imposes a solution. Somewhere along the axis of ADR approaches between these two
extremes lies ―mediation,‖ a process by which a third party aids the disputants to reach a
mutually agreed solution3.

International Perspective on ADR:

The ADR ―movement‖ started in the United States in the 1970s in response to the need to
find more efficient and effective alternatives to litigation. Today, ADR is flourishing
throughout the world because it has proven itself, in multiple ways, to be a better way to
resolve disputes. The search for efficient and better ways to resolve disputes, and the art of
managing conflicts, are as old as humanity itself, yet it has only been within the last thirty
years or so that ADR as a movement has begun to be embraced enthusiastically by the legal
system. More recently, ADR has become institutionalized as part of many court systems and
system for justice as a whole throughout the world.

As trade, investment and private business expand throughout the world at an increasing
speed, dispute resolution systems face growing challenges. In fact, just as domestic courts
have been overwhelmed by the demand on their services arising from expanding economies
and social life, so too International dispute resolution is facing the need to develop the
appropriate responses. An International Alternative Dispute Resolution system, combining
renewed traditional mechanisms with new approaches, is already in place and will no doubt
be much perfected in the years ahead4.

Alternative, private forms of dispute resolution are deeply rooted in the Western legal
tradition. With the dawn of modern International commerce, a number of International
commercial dispute resolution mechanisms developed that were effectively independent of
traditional sovereign based adjudicatory powers. Both the Law Merchants, which developed
from arbitration commissions of merchants organized by the courts, and the Law of Nations
(International Law), evolved into uniform bodies of trade customs and practices that were
independent of any one sovereign Nation5.

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International institution for ADR system:

Over the past few decades, International commercial dispute resolution has witnessed
substantial change and improvement. A notable feature has been a move away from the
traditional court-based litigation model, allowing exploration of other methods and
techniques. The United Nations Commission on International Trade Law (UNCITRAL) has
played an important role in development of alternative dispute resolution. Since its
establishment in 1966, UNCITRAL has made improving International commercial dispute
resolution one of its priorities. Two important achievements arising from its efforts are the
UNCITRAL Arbitration Rules (1976) and the UNCITRAL Conciliation Rules (1980).

The Arbitration Rules were adopted by UNCITRAL on 28 April 1976 and by the General
Assembly of the UN on 15 December 1976. The products of active participation of
International experts from various legal, economic and social backgrounds both have made a
significant contribution to the more efficient resolution of International commercial disputes.
The Conciliation Rules were adopted by UNCITRAL on 23 July 1980 and by the General
Assembly of the UN on 4 December 1980. Like the Arbitration Rules, they are written in
plain English and sequentially correspond with the process they describe. They are also
concise, consisting of just 20 articles and a short Model Conciliation Clause6.

In 1999 UNCITRAL commenced a process of evaluating the ‗extensive and favorable

experience with the use of the UNCITRAL Arbitration Rules and the UNCITRAL
Conciliation Rules‘ with a view to their future development. UNCITRAL entrusted this work
to the Working Group on Arbitration. In relation to conciliation, the Working Group was
instructed to consider the development of a model law to support the increased use of
conciliation and, specifically, to facilitate the enforcement of settlement agreements and
reduce the potential for delay in conciliation proceedings. At UNCITRAL‘s 35th session (19
to 30 November 2001), the Working Group completed its draft model law on International
commercial conciliation. In relation to arbitration, the Working Group was instructed to
examine the requirement that arbitration agreements be in writing, the enforceability of
interim protection measures issued by arbitral tribunals, and the enforceability of awards that
have been set aside in the state of origin. The Working Group is continuing its work on these
issues7.

International Commercial Arbitration:

There are two primary International Conventions that can assist parties in enforcing ADR
awards. The most important of these is the Convention on the Recognition and Enforcement
of Foreign Arbitral Awards is the New York Convention Awards. By signing the New York
Convention, countries agree to recognize and enforce arbitral awards rendered in the territory

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al%20Dispute%20Resolution%20in %20Intl%[Link]
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Working Group on Arbitration, Settlement of Commercial Disputes: Possible Uniform Rules on
Certain Issues Concerning Settlement of Commercial Disputes — Conciliation, Interim Measures of
Protection, Written Form for Arbitration Agreement, UN Doc A/CN.9/[Link]/WP.108 (20–31 March
2000).
of other signatories. The 1958 New York Convention on the Recognition and Enforcement of
Foreign Arbitral Awards is the most widely accepted treaty regarding the recognition and
enforcement of arbitral awards, providing a solid foundation for International commercial
arbitration.

The enforcement of arbitral awards has been the subject of intergovernmental effort as well,
with a large number of countries becoming parties to the United Nations Convention on the
Recognition and Enforcement of Foreign Arbitral Awards, commonly known as the "New
York Convention." Another International convention regarding the enforcement of arbitral
awards is of importance in Latin American countries. The Inter-American Convention on
International Commercial Arbitration combines elements of an earlier draft convention and
the New York Convention. While it differs from the New York Convention in some respects,
it seeks the same objectives in similar ways. Both conventions deal with the issue of
enforcing an arbitral award. The Inter-American Convention follows the New York
Convention in limiting the grounds on which a party can object to the enforcement of a
foreign arbitral award by putting the burden of proof on the party opposing enforcement to
prove the defectiveness of the award8.

The Convention on the Settlement of Investment Disputes between States and Nationals of
Other States (ICSID Convention) is the second major International ADR enforcement
convention. However, the ICSID Convention only applies to awards rendered by ICSID,
whose jurisdiction is limited to disputes between states and foreign investors. Awards
rendered pursuant to the ICSID Convention are automatically binding on the parties and are
subject to appeal only within the structure provided by the ICSID Convention9.

The International Chamber of Commerce (ICC) Rules on Arbitration:

In the International Chamber of Commerce (ICC) context, "ADR" stands for "Amicable Dispute
Resolution" given that the ICC'S ADR Rules exclude arbitration, which is covered under the separate
ICC arbitration rules. The ICC ADR Rules can be modified by agreement of the parties subject to the
approval of the ICC. Broader than the former Conciliation Rules, the new ADR Rules apply to both
domestic and International business disputes. Also, the new ICC Rules envisage that ADR can be
used not only as a replacement for or prelude to arbitration, but also during arbitration or litigation if
the parties agree.

The ICC plays an important role in the settlement of International business disputes. The ICC is
particularly well known for its International commercial arbitration rules supported by the
institutional mechanism of the International Court of Arbitration. In addition, the ICC also supported
conciliation as a mechanism for the settlement of International business disputes from its inception in
1923. ICC conciliation was actually more popular than arbitration prior to World War II.10

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9
Convention on the Settlement of Investment Disputes between States and Nationals of Other States,
1965, 17 U.S.T. 1270, 575 U.N.T.S. 159
10
International Chamber of Commerce, online at . See generally Craig, Park and Paulsson, supra,
footnote 15; Schafer, Verbist and Imhoos, supra, footnote 28.
However, International commercial arbitration became increasingly popular and, as a result,
ICC conciliation has been very much underused in recent decades. Various editions of the
ICC Optional Conciliation Rules (the Conciliation Rules) had been offered for adoption by
parties since 1923. The final version of the Conciliation Rules issued in 1988 was applicable
to all business disputes of an International character, used a sole conciliator and gave the
conciliator great freedom in the conduct of the conciliation process. On July 1, 2001, the ICC
scrapped its Conciliation Rules and replaced them with its more generic ICC ADR Rules.

The most recent amendments to the ICC Rules of Conciliation and Arbitration entered into
force on January 1, 1988. In particular, the ICC Conciliation Rules were extensively revised
both to promote the initiation of conciliation and to refine the process. Reference to the ICC
Conciliation Rules in the event of a contractual dispute between parties should be established
by the inclusion of a clause to that effect in the contract. The ICC proceeds on the basis that
resort to conciliation are optional unless the parties have otherwise agreed. There is some
inflexibility involved because the ICC Conciliation Rules, unlike the UNCITRAL
Conciliation Rules, do not contain a general provision that permits the disputants to agree to
vary or delete any of the ICC Conciliation Rules when the process is implemented.11

Modes of ADR mechanism for settlement of International disputes:

Alternative dispute redessal methods are being increasingly acknowledged in field of law and
commercial sectors both at National and International levels. Its diverse methods can helps
the parties to resolve their disputes at their own terms cheaply and expeditiously. Arbitration,
mediation, Conciliation, Ombuds is the major modes of ADR mechanism for settlement of
International disputes. Alternative dispute redressal techniques can be used in almost all
contentious matters, which are capable of being resolved, under law, by agreement between
the parties. Alternative dispute redressal techniques can be employed in several categories of
disputes, especially civil, commercial, industrial and family disputes. It may be readily
recognized that some of the methods mentioned are not unknown to international dispute
settlement, perhaps in a less structured manner and more as the result of practice than of a
formal definition. The question to be kept in mind is whether these methods will be
transplanted into International dispute settlement in order to facilitate similar goals as in
domestic experiences.

Arbitration: Arbitration is private adjudication in which a non-governmental neutral party

hears presentations by the disputants and makes a decision that is legally binding on them.
Arbitration agreements may declare in advance a willingness to arbitrate a class of disputes
that may arise in the future.

The countries with a long history of International commercial arbitration, the Arbitration
Rules play a useful cross-pollination role. As the Arbitration Rules represent the best features
of the common law and the civil law, they introduce the parties to new ways of addressing
legal issues, and techniques that can be employed in improving their own domestic systems.

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Conciliation As A Mechanism For The Resolution Of International
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According to the experience of the Arbitration Rules in International tribunals and private
arbitrations, the sensible level of discretion afforded to the arbitral tribunal as well as their
International and neutral nature make the Arbitration Rules one of the best approaches to
resolving International trade law disputes. They have proven to be practical and flexible
enough to meet the enormously different needs of parties in particular disputes.12

Mediation: In mediation, a neutral third party helps both sides to reach an agreement that
each side considers to be acceptable. It can be either evaluative, in which the mediator gives
an assessment of the legal merits of a case, or facilitative, where the mediator focuses on
assisting the parties in defining the issues. Where mediation is successful, meaning that an
agreement is reached, parties can subsequently decide to formalize the agreed solution in a
binding contract.

A mediator, like a facilitator, makes primarily procedural suggestions regarding how parties
can reach agreement. Occasionally, a mediator may suggest some substantive options as a
means of encouraging the parties to expand the range of possible resolutions under
consideration.

Conciliation: In conciliation the third party adopts a more interventionist role in bringing the
two parties together and in suggesting possible solutions. Conciliation involves building a
positive relationship between the parties to a dispute. A third party or conciliator (who may or
may not be totally neutral to the interests of the parties) may be used by the parties to help
build such relationships. A conciliator may assist parties by helping to establish
communication, clarifying misperceptions, dealing with strong emotions, and building the
trust necessary for cooperative problem-solving.

The term mediation now tends to include conciliation and may also encompass fact-finding
as well as ombudsmen. Ombudsmen are independent office holders who investigate and
make decisions regarding complaints from the public relating to mal administration, often
using mediation as part of their dispute resolution procedures.13

Ombuds: The ombudsperson is not an authoritative or final decision maker but is "a
confidential and informal information resource, communications channel, complaint-handler
and dispute-resolver." Some public agencies and corporations in the United States appoint an
ombuds person to serve as a kind of high level complaint desk, with the power to receive
disputes and complaints, an informal power to investigate, and the power to persuade or
induce changes in position through public embarrassment.14

ADR system in various countries:

12
Reynolds, ‗The Role of the Solicitor‘ (1988) 54 Arbitration 85–92; Hellings, ‗Arbitration: An
Advocate‘s View‘ (1988) 54 Arbitration 78, 78–85, cited in Herrmann, above n 4, 91.
13
G Slapper and D Kelly, The English Legal System, 10th ed. (London: Routledge Cavendish, 2009)
at 378
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ADR is now widely used. The national courts of England and Wales are required to
undertake case management by encouraging the parties to use ADR if the court considers it
appropriate to resolve the case and parties are now encouraged to seek non-court settlements
where possible in order to reduce costs and delay. Similar in other jurisdictions, resulting in
the increasing popularity of ADR relative to standard civil adjudication in both common law
and civil law systems. China in particular has a long tradition of employing mediation as a
means of resolving disputes. ADR, especially mediation, has enjoyed broad support as an
effective means of dispute settlement in the International context by a number of
commentators. The UN Charter expressly refers to ADR techniques including conciliation
and mediation, in addition to judicial settlement, as a peaceful way of resolving disputes
between states.

In the United States, mandatory pre-dispute contractual commitments to arbitrate a wide

variety of consumer, health care, securities, and employment disputes have been sustained by
the United States Supreme Court against claims these clauses violate due process or other
constitutional rights to trial for disputes. Similarly, thus far many European courts have held
that assignment to some form of ADR does not violate Article 6 of the European Convention
on Human Rights, granting basic hearing rights for human rights cases. Arbitration has, thus
far, been the mode of choice for resolving International commercial, investment, and trade
disputes, such as in the public law settings of the World Trade Organization (WTO), the
General Agreement on Tariffs and Trade (GATT) and the International Centre for the
Settlement of Investment Disputes (ICSID), and the more private International law settings of
the International Chamber of Commerce or the London Court of Arbitration. Arbitration has
also been deployed in new forms of disputes developing under both domestic and
international intellectual property regimes. Various forms of mediation and arbitration are
also being used increasingly to resolve transnational disputes of various kinds (political,
economic, natural resource allocation, and ethnic violence) and are employed by international
organizations such as the United Nations and the Organization of American States, as well as
multinational trade and treaty groups (NAFTA, the European Union, and Mercosur) and
nongovernmental organizations in human rights and other issue related disputes (Greenberg
et al. 2000).

Domestic experiences are also most relevant to these developments. ADR has become a
favored approach to dispute settlement in the United States for the past twenty-five years and
in Britain and other countries more recently. Besides the classic methods of negotiation,
conciliation, mediation and arbitration, ADR includes a variety of other methods developed
in the context of those domestic experiences.15

In Japan, long-standing cultural attitudes and historical political influences have resulted in a
preference for non-adjudicative forms of dispute settlement, primarily conciliation/mediation,
for domestic civil disputes. By the 1980s, however, it was found that conciliation/mediation

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was rarely used as a method for the settlement of International commercial disputes involving
a Japanese party, with the disputants preferring International commercial arbitration.16

Yet, by the 1990s Japan saw a growing use of med-arb for the settlement of International
commercial disputes, whereby conciliation/mediation is used during arbitration and not
before or instead of arbitration. The rules of the major Japanese International commercial
arbitration bodies permit med-arb, which is used with frequent success. The new arbitration
law in Japan, enforce in 2004, permits one or more of the arbitrators to attempt to settle the
dispute if the disputing parties provide their written consent, thereby effectively allowing the
arbitrators to use med-arb.17

The main institutions that handle International commercial arbitration in the People's
Republic of China are the China International Economic and Trade Arbitration Commission
(CIETAC) and the China Maritime Arbitration Commission (CMAC).18 The legal system of
the China has been deeply affected by the competing philosophies of Confucianism and the
legalist school of thought. Chinese dispute settlement methods still reflect the Confucian
tradition, which emphasizes hierarchy, social harmony and maintaining relationships through
compromise. Thus, mediation/conciliation has been favored historically for dispute
settlement over adjudicative means. In the domestic context, conciliation/mediation of
disputes and mediation by the courts during litigation has long been used in the PRC and,
although the rate of litigation has increased in the current era of economic reform, the
government continues to support conciliation/mediation.19

In Canada August 2004, the Uniform Law Conference of Canada (ULCC) created a Working
Group to draft uniform legislation to enact the Model Law on International Commercial
Arbitration (MLICC). The Uniform [International] Commercial Mediation Act was adopted
by the ULCC in 2005 with the recommendation that it be adopted by jurisdictions in Canada.

Canada, there was slight legislative movement by mid-2006. Nova Scotia adopted its
Commercial Mediation Act in 2005 based on the MLICC and the ULCC uniform act. It is
interesting to note that Nova Scotia did address the application of its act to med-arbs,
excluding the act from applying to mediations conducted in the course of arbitration under
the Commercial Arbitration Act unless the parties to the mediation agree otherwise. The

16
Yoshiaki Nomura, "Some Aspects of the Use of Commercial Arbitration by Japanese Corporations"
(1986), 33 Osaka U. L. Rev. 47 at pp. 47, 55 and 60- 61 ;Young, ibid., at pp. 342-43
[Link] [Link]
17
Thirgood, ibid., at pp. 180-84; Yasunobu Sato, "The New Arbitration Law in Japan: Will It Cause
Changes in Japanese Conciliatory Arbitration Practices?" (2005), 22 J. Int'l Arb. 141; The
Commercial Wayto Justice: The 1996 International Conference of the Chartered Institute of
Arbitrators (The Hague, Kluwer Law International, 1997), p. 213 at p. 217.
18
[Link].caitems7189fd0a-62b9-4a1f-9d2c-c32efb0d5e29view6eeb7e89-3144-454f-
88ca51d1fafdeef7CBLJ_45_1_20.pdf
19
Jingzhou Tao, Resolving Business Disputes in China, 1st ed. (The Hague, Kluwer Law
International, 2005) at 1,012-1,013; Reif, supra, footnote 1, at p. 630
enacting legislation is silent on the med-arb provisions in Nova Scotia's International
commercial arbitration statute.20

Today, a number of non-governmental adjudicatory organizations exist for the resolution of

commercial disputes. These organizations provide a mechanism for the resolution of
commercial disputes concerning a wide variety of subject matter. For example, the
International Chamber of Commerce (ICC), based in Paris, France, administers a significant
portion of International arbitrations, particularly cases which involve complex commercial
transactions. Other similar organizations include the London Court of International
Arbitration and the Arbitration.

Institute of the Stockholm Chamber of Commerce (SCC), the World Intellectual Property
Organization (WIPO) based in Geneva, Switzerland, also established an arbitration center.
This center could be of particular interest in the context of disputes arising on the Internet due
to its incorporation of computer technology into its arbitral procedures. The American
Arbitration Association also administers both National and International commercial
disputes.21

20
Uniform Conference of Canada, Civil Section, Activities and Priorities of the Department of Justice
in Private International Law, Report of the Department of Justice Canada 2006 (Edmonton, August
20-24, 2006), online at , at para. 82.
21
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 Indian Perspective of Alternative Dispute Resolution
Alternative Dispute Resolution in India is an attempt made by the legislators and judiciary
alike to achieve the ―Constitutional goal‖ of achieving Complete Justice in India. ADR first
started as a quest to find solutions to the perplexing problem of the ever increasing burden on
the courts.

In India, the quest for justice has been an ideal, which the citizens have been aspiring for
generations down the line. Our Constitution reflects this aspiration in the Preamble itself,
which speaks about justice in all its forms: social, economic and political. Justice is a
constitutional mandate. The possibility of a justice delivery mechanism in the Indian context
and the impediments for dispensing justice in India is an important discussion. Delay in
justice administration is the biggest operational obstacle, which has to be tackled on a war
footing. In a country, which aims to protect the socio-economic and cultural rights of citizens,
it is extremely important to quickly dispose the cases in India, as the Courts alone cannot
handle the huge backlog of cases. This can be effectively achieved by applying the
mechanisms of Alternative Dispute Resolution.

Alternative Dispute Resolution in India was founded on the Constitutional basis of Articles
14 and 21 which deal with Equality before Law and Right to life and personal liberty
respectively. These Articles are enshrined under Part III of the Constitution of India which
lists the Fundamental Rights of the citizens of India. ADR also tries to achieve the Directive
Principle of State Policy relating to Equal justice and Free Legal Aid as laid down under
Article 39-A of the Constitution. The Acts which deal with Alternative Dispute Resolution
are Arbitration and Conciliation Act, 1996 and the Legal Services Authorities Act, 1987. The
Section 89 of the Civil Procedure Code, 1908 makes it possible for Arbitration proceedings to
take place in accordance with the Acts stated above.

The Arbitration and Conciliation Act, 1996 was passed on the basis of the UNCITRAL
Model Law on International Commercial Arbitration, 1985 and UNCITRAL Conciliation
Rules, 1980. It had been recommended by General Assembly of the United Nations that all
countries should give due consideration to the said Model Law in view of the desirability of
uniformity of the law of arbitral procedures and the specific needs of the International
commercial arbitration practices. It has also recommended the use of the said Rules in cases
where a dispute arises in the context of international commercial relations and the parties
seek on amicable settlement of that dispute by recourse to conciliation. These rules are
believed to make a significant contribution to the establishment of a unified legal framework
for the fair and efficient settlement of disputes arising in International commercial relations.

Lok Adalat is a unique ADR measure in India. As such, ADR has been, a vital, and
vociferous, vocal and vibrant part of our historical past. Undoubtedly, Lok Adalat (Peoples'
Court) concept and philosophy is an innovative Indian contribution to the world
jurisprudence. It has very deep and long roots not only in the recorded history but even in pre
historical era. It has been proved to be a very effective alternative to litigation. Lok Adalat is
one of the fine and familiar fora which has been playing an important role in settlement of
disputes. The system has received laurels from the parties involved in particular and the
public and the legal functionaries, in general. It also helps in emergence of jurisprudence of
peace in the larger interest of justice and wider sections of society.22

The Section 89 of the Civil Procedure Code also provides as to referring the pending Civil
disputes to the Lok Adalat. When the matter is referred to the Lok Adalat then the provisions
of the Legal Services Authorities Act, 1987 will apply. Every award of the Lok Adalat shall
be deemed to be a decree of a civil court or, as the case may be, an order of any other court
and where a compromise or settlement has been arrived at, by a Lok Adalat .

Recent Amendments to the Arbitration and Conciliation Act, 1996

The Arbitration and Conciliation Act, 1996 has been amended in the years 2015 and 2019, to
enable making arbitration proceedings in India to be time bound, efficacious and amenable to
further litigation only on limited grounds.

The significant amendments include:

 Grounds for challenge to arbitrators have been detailed out and specified as per
prevalent international standards to uphold independence and impartiality of
arbitrators.
 Statutory framework provided for time bound completion of arbitration proceedings.
 Interim orders that can be passed by the courts or arbitral tribunals, as the case may
be, relating to arbitral proceedings have been detailed out to enable protection of the
value of the subject matter of dispute during the pendency of the arbitration
proceedings.
 The grounds for challenge to arbitral awards clarified to convey that the scope of
challenge is intended to be limited. This would enable finality to arbitral awards.
 The provision of automatic stay on the enforcement of arbitral awards, as soon an
application for setting aside an arbitral award is filed has been done away with and a
provision included that a stay on the enforcement of an arbitral award may be granted
upon imposition of conditions including deposit in case of monetary awards.
 Proposed notification of the establishment of Arbitration Council of India (ACI) for
grading of arbitral institutes in the country.

Conclusion

On the basis of available literature we can conclude that the concept of Alternative
Dispute Resolution system is important for the dream of ideal welfare state for all
countries around the World. Alternative dispute resolution (ADR) consists of a variety of
approaches to early intervention and dispute resolution. It can observed that Alternative
dispute redressal techniques can be employed in several categories of disputes, especially
civil, commercial, industrial and family disputes. Several International organizations,
including the International Chamber of Commerce (ICC) and the United Nations

22
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Commission on International Trade Law (UNCITRAL), are now taking steps to establish
an infrastructure of laws, rules and procedures which recognizes ADR clauses and
settlements reached in ADR proceedings. The New York Convention on the Recognition
and Enforcement of Foreign Arbitral Awards and the Convention on the Settlement of
Investment Disputes between States and Nationals of Other States (ICSID Convention) is
the major International ADR enforcement convention for foundation of International
commercial arbitration. Most of the countries like United states, Canada, United
Kingdom, china, Japan, France, New Zealand and Australia taking leading role for
propagate, popularized and applicability of ADR system more effectively in their
countries and take effective steps to facilitate the use of ADR options such as arbitration,
mediation and conciliation etc. Alternative Dispute Resolution in India is an attempt
made by the legislators and judiciary alike to achieve the ―Constitutional goal‖ of
achieving Complete Justice in India. It can be seen that with the spread of ADR programs
in the developed and developing world, creative uses for and designs for ADR systems
are proliferating.
 Case Studies
 TATA Sons (P) Ltd. v. Siva Industries & Holdings Ltd. & Ors.

In January 2023, the Supreme Court interpreted Section 29A of the Arbitration and
Conciliation Act, 1996 (―Act‖) in the context of international commercial arbitrations.

Facts in brief

In the year 2006, the Applicant, the Respondent No. 1 and Tata Teleservices Ltd. (―TTSL‖)
entered into a share subscription agreement (―the SSA‖) for issuance and allotment of shares
of TTSL to the Respondent No. 1. Subsequently, through another SSA, NTT Docomo Inc.
(―Docomo‖), acquired 26% equity shareholding of TTSL through a combination of primary
and secondary shares. Thereafter, in the year 2009, by a secondary share purchase agreement
(―SSPA‖), Docomo acquired 20.740 million shares of TTSL from Respondent No. 1.

To this effect, an inter-se agreement, recording the understanding arrived at between the
parties in the SSA and SSPA was executed. This inter-se agreement also provided for
purchase of shares by Respondent No.1 in the event of sale of equity shares by Docomo.
Pursuant to the said right, Docomo decided to sell off the equity shareholding.

When disputes arose between the Applicant and Docomo, the latter invoked arbitration
against the former under the rules of the London Council of International Arbitration. In the
said arbitration proceeding, the award was passed against the Applicant requiring them to
make payment to Docomo and acquire shares put by it. As agreed, upon between the parties
inter-se, the Respondent No. 1 and 2 were called upon to abide by the terms of agreement.
Upon the Respondents failure to do so, arbitration as provided for in the inter se agreement
was invoked.

The parties in the preliminary meeting agreed for an extension of the arbitrator‘s mandate for
6 months. However, due to series of events that transpired in the interregnum, the Applicant
made an interim application for an automatic extension of mandate owing to the amendment
in Section 29A of the Act.

Analysis of the SC
The SC examined that to ensure flexibility in completing proceedings in cross-border
disputes, the amended Section 29A of the Act explicitly states, “in matters other than
international commercial arbitration”, which specifically precludes international commercial
arbitrations from the mandatory timeline for rendering the arbitral awards. Further, the SC
clarified that the 2019 amendment to the Act applies to all pending arbitral proceedings as of
the effective date.

 Gujarat Composite Limited v. A Infrastructure Limited & Ors.

In May 2023, the SC upheld the Gujarat High Court‘s (―HC‖) decision rejecting a
commercial civil suit filed under Section 8 of the Arbitration and Conciliation Act, 1996
(Arbitration Act). In harmony with the HC judgment, the SC held that the relief claimed was
beyond the ambit of the arbitration clause contained in the executed agreement. The issue
raised under the suit comprised of multiple transactions, involving different parties and
agreements that contained no arbitration clause barring one agreement.
Facts in brief

Gujarat Composite Ltd. (―the Appellant‖) had entered into two license agreements with ‗A
Infrastructure Limited,‘ (―the Respondent No. 1‖). The Appellant and Respondent No. 1
executed a supplementary agreement under which a certain amount was paid to the Appellant
and Respondent No. 1 created a mortgage on the licensed manufacturing units to secure the
ad hoc advance.

Subsequently, a tripartite agreement was executed between the Appellant, Respondent No. 1,
and Bank of Baroda (Bank/ Respondent 2), wherein the bank sanctioned a loan to
Respondent No. 1. The tripartite agreement was amended to restrict the transfer of title deeds
of the Appellant‘s land during the license agreement term.

Respondent No. 1 sought to extend the license agreement term, but the Appellant refused.
After the license agreement expired, Respondent No. 1 continued to hold possession of the
premises and the Appellant sought the possession. In view of the aforesaid, disputes arose
between the parties.
Several attempts were made to amicably resolve the dispute, failing which, the Appellant
filed a composite arbitration petition. To refer the said dispute for arbitration, the Respondent
No. 1 filed a civil suit in the commercial court which was rejected as there was neither an
arbitration clause in the tripartite agreement nor reference to the original agreement
containing the arbitration clause.

Aggrieved by the commercial court order, the Appellant approached the HC. The HC, while
rejecting the appeal, held that the suit was partly beyond the arbitrator‘s jurisdiction,
involving non-signatories to the arbitration agreement. Hence, Section 8 of the Act would not
be attracted. Challenging the order of the HC, the Appellant filed an appeal before the SC.

SC’s decision

In consonance of the decision of the civil court and the HC, the SC while dismissing the
appeal held that the words used „in a matter which is the subject of an arbitration
agreement‟ under Section 8 of the Act makes it abundantly clear that the subject matter of the
dispute should be amenable to an arbitration agreement. The SC‘s decision clarified that the
court cannot refer the parties under Section 8 of the Act when a suit is instituted where the
subject matter and the relief claimed by a party falls outside of the rubic of the arbitration
agreement.
 Bibliography

1. Dr. Pandey J.N., Constitution of India, 58th edition (2021), Central Law Agency.
2. [Link]
6NmAh27ATPrEAAYASAAEgIFrfD_BwE
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challenges_August_2016_1909046205_6404265.pdf
4. [Link]
5. AndraLeigh Nenstiel, Online Dispute Resolution: A Canada-United States Initiative,
32 Can.-U.S. L.J. 313(2006)
6. [Link]
7. [Link]=2634&context=til
8. International Chamber of Commerce, online at
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c32efb0d5e29view6eeb7e89-3144-454f-88ca-51d1fafdeef7CBLJ_45_1_20.pd
10. Uniform Conference of Canada, Civil Section, Activities and Priorities of the
Department of Justice in Private International Law, Report of the Department of
Justice Canada 2006 (Edmonton, August 20-24, 2006),
11. [Link]