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There is no particular recognised definition of arbitration. Even, the Arbitration and Conciliation Act, 1996 does not provide any specific definition of the word "Arbitration". It merely says that arbitration means any arbitration whether or not administered by a permanent arbitral institution [section 2(a) of the act]. Arbitration, in law, is a method of ADR—particularly, an alternative to court room litigation, whereby the parties to a dispute mutually agree to submit their respective positions (through agreement or hearing) to a third party which is a neutral party and called the Arbitrator for resolution of the dispute between them. The appointed arbitrator considers the evidence and arguments presented by both the parties relating to the cause of the dispute and then issues an award, which is enforceable by the courts.

 Thus, Arbitration may be described as a mechanism or a method of resolution of disputes by a procedure that, unlike court, takes place in camera, pursuant to an agreement between the parties in. It is an efficient and an alternate process of dispute resolution between the parties in dispute. It is a process of dispute resolution that is binding and is governed by an Act. It is a conventional 'alternative' to courtroom litigation.

Object of the Arbitration and Conciliation Act, 1996

The main object of the Act is to consolidate and amend the law relating to:

  1. domestic arbitration;
  2. international commercial and business arbitration;
  3. enforcement and implementation of foreign arbitral awards;
  4. and to define the laws relating to  conciliation and matters that are connected therewith or incidental thereto.

Some of the other objects, as provided in the Statement of Objects and Reasons for the Arbitration and Conciliation Bill, 1995 are as follows:

  • to comprehensively cover disputes relating to international, commercial issues and to come to a resolution through the process of arbitration and conciliation .
  • to make provisions for a process of carrying out the arbitration proceedings which is fair, efficient and has the capacity to bring the parties to dispute to an amicable resolution
  • to make provision that the arbitral tribunal gives reasons as its decision for its arbitral award;
  • to make sure that the arbitral tribunal works within the boundaries of its jurisdiction;
  • to reduce the supervision of the courts in the process of arbitration;
  • to allow an arbitral tribunal to apply mediation, conciliation or other dispute resolution processes during the arbitral proceedings to come to a settlement of disputes;
  • to ensure that every award by an arbitral tribunal is enforced in a way as if it were a decree of a court of law;
  • to provide for the implementation of foreign awards and the procedure for implementation.


  • Introduction
  • Object of the Arbitration and Conciliation Act, 1996
  • Other objects and reasons for the Act.

BY : Vinayan Singh

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