Adjudication

What is Adjudication?

**Adjudication** is the formal legal process by which a **court, tribunal, or other authorised body** hears the arguments of the disputing parties, examines the evidence, applies the relevant law, and delivers a **binding decision** (judgment, order, or award) resolving the dispute. It is the core function of the judicial system — the systematic determination of rights and liabilities through a structured legal proceeding.

In everyday terms, adjudication is what happens when two parties who cannot agree on something bring their dispute to a judge or tribunal. The judge listens to both sides, looks at the evidence, applies the law, and decides who is right. That decision is binding — the parties must comply with it.

Legal Definition and Framework

Adjudication is not defined in a single statute but is the fundamental process underlying all judicial and quasi-judicial proceedings in India. The framework for adjudication varies depending on the nature of the dispute and the adjudicatory body.

Key Legal Provisions

- **Article 136 of the Constitution:** Grants the Supreme Court the power to grant special leave to appeal from any judgment, decree, determination, sentence, or order of any court or tribunal, recognising adjudication as a function performed by courts and tribunals alike.

- **Article 227 of the Constitution:** Grants High Courts superintendence over all courts and tribunals within their jurisdiction, implicitly recognising the adjudicatory function of these bodies.

- **Section 9 of the Code of Civil Procedure, 1908:** The courts shall have jurisdiction to try **all suits of a civil nature** except suits of which their cognizance is expressly or impliedly barred. This establishes the court's fundamental adjudicatory power in civil matters.

- **Section 2(c) of the Arbitration and Conciliation Act, 1996:** Defines an "arbitral tribunal" as a body constituted to adjudicate disputes referred to arbitration — recognising adjudication by non-court bodies.

- **Insolvency and Bankruptcy Code, 2016:** Specifically uses the term "adjudicating authority" — the **National Company Law Tribunal (NCLT)** for companies and **Debt Recovery Tribunal (DRT)** for individuals — to refer to the body that adjudicates insolvency and bankruptcy matters.

The Adjudication Process

A typical adjudication process in an Indian court follows these stages:

1. **Filing of the case:** The plaintiff (civil) or complainant/prosecution (criminal) files the case before the appropriate court.

2. **Service of notice:** The court issues notice to the opposing party (defendant/accused) to appear and respond.

3. **Pleadings:** Both parties file their written statements — plaint and written statement in civil cases; charge and defence in criminal cases.

4. **Framing of issues:** The court identifies the specific questions of fact and law that need to be determined.

5. **Evidence:** Both parties present their evidence — witnesses, documents, and expert opinions.

6. **Arguments:** Lawyers for both parties present their legal arguments.

7. **Judgment:** The court delivers its decision — the adjudication proper.

8. **Decree/Order:** The formal operative order giving effect to the judgment.

Types of Adjudicatory Bodies in India

| Body | Type of Disputes |

|---|---|

| **Civil Courts** (District Courts, High Courts, Supreme Court) | General civil disputes — property, contracts, succession |

| **Criminal Courts** (Magistrate Courts, Sessions Courts, High Courts, Supreme Court) | Criminal offences |

| **Tribunals** (NCLT, ITAT, NCLAT, DRT, CAT, SAT, NGT) | Specialised matters — company law, tax, debt recovery, service matters, securities, environment |

| **Consumer Forums** (District, State, National Consumer Disputes Redressal Commission) | Consumer complaints |

| **Lok Adalats** | Settlement of disputes by mutual consent (Section 89 CPC) |

| **Arbitral Tribunals** | Commercial and contractual disputes referred to arbitration |

| **Labour Courts and Industrial Tribunals** | Labour and industrial disputes under the Industrial Disputes Act |

Adjudication vs. Other Dispute Resolution Methods

| Method | Key Feature |

|---|---|

| **Adjudication** | Binding decision by a judge/tribunal after formal proceedings |

| **Arbitration** | Binding decision by a private arbitrator chosen by the parties |

| **Mediation** | Facilitated negotiation — mediator helps parties reach a settlement; not binding unless agreed |

| **Conciliation** | Neutral conciliator proposes solutions; not binding unless accepted |

| **Negotiation** | Direct discussion between parties; no third-party involvement |

When Does This Term Matter?

In Court Proceedings

Every court case is fundamentally an adjudication. When you file a civil suit, a criminal complaint, a writ petition, or an appeal, you are seeking adjudication — a binding determination by a competent authority. The right to adjudication is protected under **Article 14** (equality before law), **Article 21** (right to life, which includes the right to a fair trial), and **Article 32/226** (constitutional remedies).

In Tribunal Proceedings

With the increasing specialisation of law, adjudication by **tribunals** has become crucial. The NCLT adjudicates company law and insolvency matters, the ITAT adjudicates income tax disputes, the NGT adjudicates environmental matters, and the CAT adjudicates service matters of central government employees. The Supreme Court in **L. Chandra Kumar v. Union of India (1997) 3 SCC 261** held that while tribunals may be created to adjudicate specialised matters, their decisions are subject to judicial review by the High Court, preserving the supervisory role of the constitutional courts.

In Insolvency Proceedings

The **Insolvency and Bankruptcy Code, 2016** specifically designates the NCLT as the **"Adjudicating Authority"** for corporate insolvency resolution processes and liquidation. This statutory use of the term highlights adjudication as a formal, structured process with specific procedural requirements.

In Tax and Revenue Matters

Tax adjudication — by Assessing Officers, Commissioners (Appeals), the Income Tax Appellate Tribunal, and ultimately the High Courts and Supreme Court — determines the tax liability of individuals and corporations. Under the **Income Tax Act, 1961** and the **GST Act**, adjudication follows specific statutory procedures with opportunities for hearing and appeal.

Practical Significance

- **Adjudication produces binding decisions** — unlike mediation or conciliation, the adjudicator's decision must be complied with by both parties.

- **Fair hearing is mandatory** — the principles of **natural justice** (audi alteram partem and nemo judex in causa sua) must be followed in every adjudication.

- **Subject to appeal** — most adjudicatory decisions can be challenged before a higher authority.

- **Tribunal adjudication is faster** (in theory) than regular court adjudication for specialised matters.

- **Res judicata applies** — once a matter has been adjudicated by a competent court, it cannot be re-adjudicated between the same parties on the same cause of action.

Frequently Asked Questions

What is the difference between adjudication and arbitration?

**Adjudication** is the decision-making function of a **court or tribunal** established by law, exercising the sovereign judicial power of the state. **Arbitration** is a **private, consensual process** where the parties agree to have their dispute decided by an arbitrator of their choice under the Arbitration and Conciliation Act, 1996. Both produce binding decisions, but adjudication is a public function exercised by state-appointed or state-authorised bodies, while arbitration is private and based on the parties' agreement. Arbitral awards are enforceable as court decrees under Section 36 of the Arbitration Act.

Can an administrative body perform adjudication?

Yes. Many administrative bodies in India perform **quasi-judicial functions** — they adjudicate disputes within their statutory jurisdiction. Examples include the Collector adjudicating land acquisition disputes, the Registrar of Companies deciding registration disputes, and the Stamp Duty Adjudicating Authority determining the stamp duty payable on instruments. However, such administrative adjudication must comply with principles of natural justice and is subject to judicial review by courts. The Supreme Court in **A.K. Kraipak v. Union of India (1969) 2 SCC 262** held that even administrative decisions affecting rights must follow principles of natural justice.

What happens if a party does not comply with an adjudicatory decision?

If a party fails to comply with a court's adjudicatory decision (decree or order), the other party can initiate **execution proceedings** under Order 21 CPC to enforce the decree. For monetary decrees, the court can attach and sell the defaulter's property, garnish their bank accounts, or even order civil imprisonment in cases of wilful non-compliance. Non-compliance with tribunal orders may also constitute **contempt of court** under the Contempt of Courts Act, 1971, punishable with imprisonment up to six months or fine up to Rs. 2,000, or both.

Is adjudication always necessary to resolve a dispute?

No. The law actively encourages **alternative dispute resolution (ADR)** methods — arbitration, mediation, conciliation, and Lok Adalats — under **Section 89 CPC** and the Arbitration and Conciliation Act, 1996. ADR methods are often faster, cheaper, and less adversarial than formal court adjudication. However, certain matters — such as criminal offences, matters of public law, constitutional questions, and non-compoundable disputes — generally require formal adjudication by courts and cannot be resolved through ADR.