Courts and ADR Mechanisms in India: Institutional Harmony or Jurisdictional Overlap

I. Introduction

The institutionalization of Alternative Dispute Resolution mechanisms has brought a revolution in the Indian judicial system. Mechanisms such as arbitration, mediation, and conciliation, have emerged as very important tools to reduce the burden on courts and promote cooperative resolution of disputes which will also lead to faster disposal of cases.However, nowadays, ADR tends to be more mainstream, several questions arise regarding the balance between judicial oversight and the autonomy of ADR institutions. As of late 2025, the total number of pending cases across all levels of the Indian judiciary has risen to over 53 million (5.3 crore). Over 86% of the cases are in subordinate District/Taluk courts, totaling about 4.6 crore cases; High Courts have close to 63 lakh cases, and pending cases in the Supreme Court number over 86,000. The rate of new filings often outpaces the rate of disposals-a key factor contributing to the mounting problem of arrears. The disposal rate is notably lower in High Courts (around 28%) compared to the Supreme Court (around 55-59%) and subordinate courts (around 40%). These data raise serious concern about the need of fast disposal of cases and proper implementation of alternative dispute resolutions in Indian legal system.

II. Evolution of ADR Mechanisms in India

The idea of ADR in India has roots which emerged from the traditional forms of community-based justice such as panchayats and nyaya panchayats. Modern ADR was institutionalized through the Arbitration and Conciliation Act, 1996.It is based on the UNCITRAL Model Law with the purpose of providing a stable legal framework for arbitration and conciliation.

Judicial recognition and affirmation of ADR came in terms of the landmark judgment Afcons Infrastructure Ltd. v. Cherian Varkey Construction Co. (P) Ltd. (2010) 8 SCC 24[1], where the Supreme Court emphatically laid emphasis on court-annexed mediation and referral to ADR as necessary pre-litigation requirements. This development lead to more structured and international standards which is driven by the need to reduce court backlogs and provide faster and more efficient dispute resolution. ADR existed in India through traditional community-based systems like village councils (panchayats), and social or trade guilds which focused on reconciliation and harmony of the community. During colonial era legal recognition of arbitration began with the Indian Arbitration Act,1899 based on English law. Later in the course of law, The CPC of 1908, particularly the Second Schedule, provided courts with powers to refer disputes to arbitration.then the Arbitration Act, 1940 came into force, This act consolidated and replaced earlier legislation, serving as the primary law for domestic arbitration for over fifty years. It was, however, criticized for its excessive judicial intervention, which sometimes slowed down the process. After several new acts amendments Arbitration and Counciliation Act, 1996 came into force, This landmark act replaced the 1940 Act which is a significant development, bringing Indian law in line with the UNCITRAL Model Law. It integrated laws of domestic and international laws on arbitration and conciliation by aiming for a more autonomous and efficient process. Various arbitral institutions have been established to provide infrastructure for ADR. In contemporary era, the evolution continues with a focus on reducing the judicial burden by encouraging institutional arbitration.

III. Institutional Harmony between Courts and ADR

Judiciary has played a conducive role in promoting ADR. Under Section 89 of the Code of Civil Procedure, 1908[1], the courts are empowered to refer disputes to Alternative Dispute Resolution processes thus creating a cooperative framework for adjudicating process rather than a competing one. Another contribution of the judiciary has been the development of Alternative Dispute Resolution infrastructure, such as the Delhi International Arbitration Centre and the Maharashtra Mediation Centre. In Bharat Aluminium Co. v. Kaiser Aluminium Technical Services Inc. (2012) 9 SCC 552[2], the Supreme Court firmly asserted the least interference by the Courts in arbitration, while giving recognition to the independence of arbitral institutions.Similarly, in M/s. Centrotrade Minerals & Metal Inc. v. Hindustan Copper Ltd. (2016) 11 SCC 455[1], the Court endorsed two-tier arbitration which showcase the judicial respect for party autonomy.

IV. Jurisdictional Overlaps and Institutional Frictions

In spite of regulated laws for cooperation and proper adjudication of cases, there are still certain overlaps which are relentless between courts and Alternative Dispute Resolution mechanisms. Court’s intervention is frequently seen in arbitration matters under Sections 9, 34, and 37 of the Arbitration and Conciliation Act,1996[1] that leads to undermine the principle of party autonomy. Excessive and unnecessarily judicial review delays and enforcement discourages international investors in seeking efficient results.

The issue of jurisdictional overlap arises in court-annexed mediation too, where questions persist regarding the enforceability of settlements through mediation. The Mediation Act, 2023, aims to address these concerns by providing statutory recognition and enforcement mechanisms for settlements made through mediation. Lower courts sometimes misinterpret arbitration clauses by prioritizing formalities of a legal process over the substance of the parties who have intention to arbitrate.it tends to adopt overly literal interpretations in the adjudication process or confusing procedural invalidity with the invalidity of the entire agreement.

V. Constitutional Dimensions of ADR

The constitutional framework supports ADR as an extension of the right to access justice under Article 21 of the Constitution[6]. In Salem Advocate Bar Association v. Union of India (2003) 1 SCC 49[7], the Supreme Court upheld the validity of Section 89 CPC[8] by observing that ADR facilitates speedy justice and reduces judicial backlog. ADR also aligns with the Directive Principles of State Policy under Articles 39A and 51[9]. Guarantee of Article 14[10] of the constitution which states “equality before the law” is closely linked to Alternative Dispute Resolution as a tool for achieving equal access to justice. ADR mechanisms in our legal system such as Lok Adalats, which provide quicker and cheaper alternative to the traditional court system making justice more accessible to all. These kinds of alternative is helpful especially to the poor, marginalized, and those with disabilities by ensuring opportunities for justice are not denied due to economic or any other disadvantages of the public.

VI. Conclusion

The interaction between courts and Alternative Dispute Resolution in India embodies both synergy and strain. While judicial support has strengthened ADR’s credibility but excessive intervention risks undermining its autonomy which leads to or results in losing the entire purpose of the ADR itself. An Ideal future oriented policy framework should focus at streamlining judicial intervention by enhancing institutional capacity and by ensuring quality control across Alternative Dispute Resolution centers in the nation. Reforms should focus on:

In conclusion, the most effective and progressive model is a cooperative partnership. Courts and Alternative Dispute Resolution are not mutually exclusive but are complementary components of a robust justice delivery system. Their integrated function ensures that justice is delivered not only fairly and with legal authority but also in a timely, cost-effective, and efficient manner that serves the diverse needs of the society.