Alternative Dispute Resolution Mechanisms in India: Four Ways to Skip the Trial

India’s courts face a massive backlog of pending cases. This article covers the mechanisms built to resolve disputes without a full trial.

Four Ways to Skip the Trial

Polity0117

PRIVATE & BINDING

Arbitration

An arbitrator decides; under the Arbitration and Conciliation Act, 1996

STATUTORY FORUM

Lok Adalat

Award is a civil court decree, no appeal possible

VOLUNTARY SETTLEMENT

Mediation

Neutral mediator, formalised by the Mediation Act, 2023

INFORMAL & FLEXIBLE

Conciliation

Conciliator actively proposes settlement terms

The shared goal: resolve disputes faster and cheaper than a full court trial.

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Must Know

• Alternative Dispute Resolution (ADR) mechanisms settle disputes outside the regular court system. India relies on four main ones: arbitration, conciliation, mediation and Lok Adalats.
• Arbitration is governed by the Arbitration and Conciliation Act, 1996. An independent arbitrator hears both sides and gives a binding decision, much like a private judge.
• Lok Adalats get statutory status from the Legal Services Authorities Act, 1987. Their award counts as a civil court decree. No appeal lies against it in any court.
• Mediation was formalised nationally by the Mediation Act, 2023. A neutral mediator helps both sides reach their own voluntary settlement, rather than imposing one.
• Conciliation also falls under the 1996 Act. It resembles mediation, but the conciliator can actively propose settlement terms, not just facilitate discussion.

Good to Know

• Lok Adalats blend all three other ADR forms. Their members act as statutory conciliators, and often follow procedures drawn from the Arbitration and Conciliation Act itself.
• The Mediation Act, 2023 was notified on 15 September 2023, with key provisions in force from 9 October 2023. It also set up a Mediation Council of India to accredit mediators.
• The Act makes pre-litigation mediation mandatory for civil and commercial disputes. Parties must attempt mediation before filing most such cases in court.
• For the constitutional doctrine of separation of powers between India’s three organs of government, see Polity0021 — Separation of Powers and Judicial Review.
• For the tribunal system, including the Central Administrative Tribunal, see Polity0115 — Delegated Legislation and Administrative Tribunals.

Test Yourself

Please wait…

1. Which Act governs arbitration and conciliation as dispute resolution methods in India?

The Arbitration and Conciliation Act, 1996

The Legal Services Authorities Act, 1987

The Mediation Act, 2023

The Code of Civil Procedure, 1908

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Great to Know

• Lok Adalats and mediation both avoid a binding, court-imposed outcome. But Lok Adalats still produce a final, unappealable decree once both sides agree, while a failed mediation simply sends the case back to court.
• Arbitration works best for commercial disputes between parties who want privacy and a fast, expert decision, since arbitrators are often chosen for subject expertise a regular judge may lack.
• Mandatory pre-litigation mediation reflects a real policy shift. Instead of only offering ADR as a court-referred option, the state now asks disputing parties to try mediation before they can even file certain civil suits.
• All four mechanisms share one aim: reducing the load on India’s regular courts. Millions of pending cases make faster, cheaper resolution routes a practical necessity, not just a procedural nicety.

Current Affairs

• 7 August 2026: Chief Justice of India Surya Kant, addressing Maadhyam’s International ADR Conference 2026 in New Delhi, said mediation should be India’s “first recourse,” not a last resort.
  • He pointed to Section 12A of the Commercial Courts Act, which already makes pre-litigation mediation compulsory for many commercial disputes, and cited studies showing voluntary compliance with mediated settlements can run as high as 90%.
  • The CJI said India, backed by the Mediation Act, 2023 and growing institutional capacity, could become a genuine global hub for mediation, and highlighted Online Dispute Resolution and hybrid Med-Arb-Med models as accessibility boosters for cross-border commercial disputes.
  (Source: ANI)
• 7 August 2026: The Parliamentary Standing Committee on Personnel, Public Grievances, Law and Justice, chaired by Shri Brij Lal, presented its 165th Report on India’s Alternative Dispute Resolution ecosystem to Parliament.
  • The report, ‘Creation and Development of Institutional Mechanism to support the Alternative Dispute Resolution Ecosystem’, was adopted by the Committee on 5 August 2026.
  • It found the India International Arbitration Centre has limited visibility and caseload, despite being meant to compete with global institutions like Singapore’s SIAC and Hong Kong’s HKIAC, and called for targeted outreach and clearer performance benchmarks.
  • On mediation, it recommended fast-tracking the Mediation Council of India, and making Pre-Institution Mediation mandatory with cost penalties for parties who treat it as a mere formality.
  • It also recommended strengthening NALSA’s manpower and budget, so it can better support Lok Adalats and legal aid nationwide.
  (Source: PIB)