What is arbitration and explain in detail?

Arbitration is a process of judging and settling of
disputes by a person not acting as a an judge appointed by law, but by a person or a
group of person jointly accepted by the parties in disputes as having the authority to
examine the dispute and give judgement. The arbitrator appointed may have a legal
background, but this is not an essential requirement for acting as an arbitrator. Such
arbitration judgement, generally called awards, are limited to decision involving
monetary matters and meeting of contractual, commercial and social obligations.
Arbitrators are not expected to give punishments such as jail
sentence.

The arbitration process can be absolutely free of
any legal formal legal binding, but there are provisions in law of many countries that
provide some legal backing to the process and judgement of
arbitration.

The process of arbitration is employed to
facilitate settlement of disputes without incurring the cost and time of formal legal
process. Arbitration is now used by individuals, groups, companies and
nations.

In a properly conducted arbitration the
arbitrators ascertain the facts, and claims of different parties to the dispute by
calling for information from them, which can be provided verbally or in writing. The
arbitrators may also obtain and study any other information considered relevant. Unlike
formal legal proceedings, the arbitrators play a major role on the kind of information
to be collected, rather on rely just on what is presented by the contending
parties.

Generally, arbitration process does not involve
representation of a case by advocates or other legal professionals. However, it may be
permitted in some cases depending upon nature of arbitration and decision of the
arbitrators.