It is a well-established and widely used means to settle the dispute. It is the Alternative Dispute Resolution, which provides the parties with a choice other than litigation. Unlike litigation arbitration takes place out of the Court but is less time consuming as compared to the litigation. In Arbitration the two parties select a Third party mutually or through the Court who shall be impartial with respect to the disputing parties. The third party known as Arbitrator and then participate in a hearing at which both sides can present evidence and testimony. The arbitrator's decision is usually final, and courts rarely reexamine it.

Although certain ADR techniques are well established and frequently used-for example, mediation and arbitration-alternative dispute resolution has no fixed definition. The term alternative dispute resolution includes a wide range of processes. Litigants, lawyers, and judges are constantly adopting existing ADR processes or devising new ones to meet the unique needs of their legal disputes. The definition of alternative dispute resolution is constantly expanding to include new techniques for dispute redressal.

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