Is the peer review process flawed?

This has been the hot grossing topic of the research community. I have been reading numerous articles and opinions by authors worldwide embossing on the flaws cropping in the peer review process. Did the traditional widely-used process had loopholes since inception or has it lost its significance with the emerging number of researches?

Actually the issue of concern is the growing percentage of paper rejection by many leading journals. With the rapidly growing number of submissions, the journal editors and peers are bound to reject quality studies to focus on relevancy and the journal scope. I too believe that many quality articles are not getting the deserved acknowledgement but at the same time it is also true that these rejections are paving way for fresh publishing grounds and enhanced researches.

What would you have to say about this? Do share your suggestions.