Arbitration and conciliation

The expansion of International trade and investment resulting from globalisation of world economy and emergence of new economic order calls for adoption of effective, efficacious and speedier alternatives for settlement of commercial disputes. A large number of foreign investors had from time to time expressed their concern about unsatisfactory and tedious dispute settlement mechanism prevailing in India. The business community within the country had also on several occasions suggested that the system of settlement of commercial disputes requires streamlining with a view to ensure quicker settlement of commercial disputes. Moreover there were a consensus that the arbitration mechanism available under the Arbitration Act of 1940 had led to further litigation in the Courts because of the arbitral awards being challenged in the Courts on one or the other ground therefore all parties concerned showed their consent to evolve a system whereby the disputes can be resolved through consensus.