Introduction

The Indian judicial system has been plagued with pendency of cases,
overburdened courts, and protracted litigation timelines. In this context,
Alternative Dispute Resolution (ADR) has emerged as a vital tool to facilitate
the resolution of disputes efficiently and amicably. ADR refers to a set of
mechanisms that provide alternatives to traditional court litigation, including
methods such as arbitration, mediation, conciliation, negotiation, and
judicial settlement.
The formal recognition of ADR mechanisms in India came through Section 89 of
the Civil Procedure Code (CPC), 1908, which was introduced by the CPC
(Amendment) Act, 1999. This section empowers courts to refer disputes for ADR
methods if it deems them appropriate, fostering a culture of speedy and cost-
effective dispute resolution.
Importance of ADR in Indian Judiciary
The judiciary plays a crucial role in upholding justice; however, systemic
challenges like backlog and delays have made traditional litigation unsustainable
for many litigants. ADR, therefore, holds great significance in the Indian judicial
framework:
1. Reduction in Pendency of Cases
ADR provides an alternative platform to resolve disputes outside the
formal court system, significantly reducing the number of cases pending
before courts. With millions of cases pending in Indian courts, ADR offers
much-needed relief.
2. Time and Cost Efficiency
ADR mechanisms are faster and less expensive compared to traditional
litigation. By avoiding lengthy legal procedures, ADR ensures that justice is
delivered promptly and economically.
3. Preservation of Relationships
Unlike adversarial court litigation, ADR methods, such as mediation and
conciliation, focus on collaboration and mutual agreement. This approach
is particularly useful in family disputes, business conflicts, and other
matters where maintaining relationships is important.
4. Access to Justice
ADR enhances access to justice by providing an alternative forum that is
less intimidating, more informal, and accessible to marginalized sections
of society.
5. Party Autonomy
ADR allows parties to play an active role in the dispute resolution process.
They can select the method, the mediator/arbitrator, and decide the terms
of resolution, ensuring greater satisfaction with the outcomes.
6. Flexibility and Confidentiality
ADR methods offer greater flexibility in procedure and timelines.
Additionally, the confidentiality maintained in processes like mediation and
arbitration helps protect the privacy of parties involved.
Section 89 of the Civil Procedure Code, 1908
1. Overview of Section 89
Section 89 was incorporated to promote ADR mechanisms by empowering courts
to refer disputes for settlement outside the traditional judicial process. The
provision states:
"Where it appears to the Court that there exist elements of a
settlement which may be acceptable to the parties, the Court shall
formulate the terms of settlement and give them to the parties for their
observations. After receiving the observations of the parties, the Court
may reformulate the terms of a possible settlement and refer the same
for:
 Arbitration,
 Conciliation,
 Judicial settlement including settlement through Lok Adalat, or
 Mediation."
In essence, Section 89 seeks to integrate ADR into the judicial process, enabling
courts to recommend appropriate methods for resolving disputes outside the
court system.
2. Judicial Interpretation and Landmark Cases
 Salem Advocate Bar Association v. Union of India (2005)
In this case, the Supreme Court clarified the implementation of Section 89
and emphasized the need to encourage ADR mechanisms. The court
observed that ADR is essential for reducing the burden on courts and
enhancing access to justice.
 Afcons Infrastructure Ltd. v. Cherian Varkey Construction Co.
(2010)
The Supreme Court laid down guidelines for determining the suitability of
cases for ADR under Section 89. The court stated that civil disputes
relating to business, trade, contracts, property, and family matters are
best suited for ADR.
3. Challenges in Implementation of Section 89
Despite the significance of Section 89, its implementation has faced several
challenges:
 Lack of Awareness: Many litigants and lawyers are unaware of ADR
methods and their benefits.
 Training of Mediators and Arbitrators: The effectiveness of ADR
depends on skilled professionals, but there is still a lack of trained
mediators and arbitrators in India.
 Resistance from Stakeholders: Parties and even legal practitioners
sometimes hesitate to opt for ADR due to unfamiliarity or a preference for
traditional litigation.
Significance of ADR in Modern India
Given the challenges faced by the judiciary, ADR is a cornerstone of judicial
reform in India. Its integration into the legal framework through Section 89
reflects a progressive approach to dispute resolution. ADR promotes:
1. Efficient Judicial Administration: By resolving cases outside the court,
ADR contributes to judicial efficiency.
2. Economic Development: Quick resolution of commercial disputes
through arbitration fosters a business-friendly environment, attracting
investments and boosting economic growth.
3. Social Harmony: ADR methods like mediation and Lok Adalats promote
amicable settlements, thereby fostering peace and harmony in society.