Arbitration is a procedure in which a dispute is submitted, by agreement of the parties, to one or more arbitrators who make a binding decision on the dispute. In choosing arbitration, the parties opt for a private dispute resolution procedure instead of going to court.

In India, one of the most popular modes of ADR is arbitration, conducted as per the provisions of the Arbitration and Conciliation Act, 1996. The first formal statute relating to the subject of arbitration in India was the Indian Arbitration Act, 1899, applicable only to Presidency towns of Madras, Bombay and Calcutta.

INTRODUCTION. Arbitration is a dispute-resolution process in which the parties select a neutral third party to resolve their claims. Parties typically agree to arbitrate in order to avoid the time, expense, and complexity of litigation.

The Terms of Reference are a contractual instrument signed by the parties and the arbitrators after the arbitral tribunal is constituted. Its main objective is to define the dispute in a clear manner and to evidence the agreement of the parties in regard to procedural matters.