Lok Adalat Can Take Cognizance Of Any Matter Only On A Reference By The Court In Pending Cases: Bombay HC
The Bombay High Court has held that Lok Adalat can take cognizance of any matter only on a reference by the Court in pending cases or on a reference by the authority or Committee organizing the Lok Adalat in pre-litigation cases.
The Court also summarised guidelines that are required to be followed after relying on various decisions of the Courts.
The Bench of Justice Gauri Godse held, “The Authority, or the Committee organizing the Lok Adalat, is under obligation to follow the procedure contemplated under Section 20 of the said Act. In the absence of a valid Order by the concerned Court making a reference under sub-section (1) of Section 20, the Committee has no authority to transfer the pending cases to the Lok Adalat directly. Such a reference directly made by the Authority or the Committee, apart from being illegal, will also be an exercise in futility, amounting to a waste of time and would defeat the very purpose and object of Lok Adalat… The procedure contemplated under Section 20, read with Sections 19 and 21 of the said Act, is not an empty formality. Only for showing that a large number of cases were disposed of in Lok Adalat, the mandatory procedures cannot be bypassed, as it would defeat the very purpose and object of Lok Adalat. Any Award made in breach of the procedures contemplated under Section 20 cannot be termed as a valid Award under Section 21 of the said Act.”
Advocate Sujeet R Bugade for the Petitioner while Advocates Jay Patil and Vishal Kanade appeared for the Respondents.
A petition was filed by the original defendant to challenge the Award passed by the Lok Adalat disposing of the suit in terms of the settlement arrived at between the parties before the Lok Adalat. The petitioner challenges the Award on the ground that he never intended to settle the dispute and was unaware that his signature was obtained on the settlement terms.
The case was listed before the Lok Adalat and a report was called from the concerned Court considering the manner in which it was disposed of and for submitting necessary details and all the particulars regarding the order of reference as required under Section 20 of the Act as well as the particulars of the procedure followed before the Lok Adalat. The Court perused the report and orders passed by the Lok Adalat and said that the orders neither bear any date nor have any signature of the Judge.
“it is necessary for the Lok Adalat to consider the issue of the legality of the compromise, and if the Lok Adalat has a doubt about the legality of the settlement made before it, instead of passing an Award, the case must be returned to the regular Court. It is the duty of the Lok Adalat to inquire whether the parties have understood the contents of the compromise or settlement and whether they have willingly signed. Thus, the compromise or settlement recorded before the Lok Adalat must satisfy the same test as laid down under Rule 3 of Order XXIII of CPC.”, the Court said.
The Court referred to Sections 19, 20 and 21 of the Act and observed that the Lok Adalat has jurisdiction to determine and to arrive at a compromise or settlement between the parties in two contingencies. Firstly, in the cases pending before the Court for which Lok Adalat is organized, and secondly, in the cases falling within the jurisdiction of the Court but not brought before the Court, i.e. pre-litigation cases within the jurisdiction of the Court for which the Lok Adalat is organized. In both the contingencies indicated above, the Lok Adalat can take cognizance of the cases referred to under sub-section (1) or (2) of Section 20 of the Act.
The Court held, “Thus, for the Lok Adalat to take cognizance of any matter, a reference by the Court in pending cases or a reference by the authority or Committee organizing the Lok Adalat in pre-litigation cases is mandatory as contemplated under Section 20. In view of Section 21, the Award made by the Lok Adalat shall be deemed to be a decree of a civil court or as the case may be, and shall be final and binding on the parties. Thus, when parties arrive at any settlement or compromise before Lok Adalat, the Award has to be made by Lok Adalat and not by the concerned judge in his capacity as a judge or independently as head of the Lok Adalat panel. The Award under Section 21 has to be of the Lok Adalat, which means the entire Panel of the Lok Adalat.”
In addition to the above, the Court also laid down the following conclusions:
1. Lok Adalat has jurisdiction to determine and arrive at a compromise or settlement between the parties in two contingencies: first, in cases pending before the Court for which Lok Adalat is organized, and second, pre-litigation cases within the jurisdiction of the Court for which the Lok Adalat is organized.
2. The Lok Adalat can consider pending cases referred by the Court and pre-litigation cases referred by the Authority or the Committee organizing the Lok Adalat.
3. Parties can agree to refer any pending case to the Lok Adalat or by way of an application.
4. If the Authority or the Committee organizing the Lok Adalat receives an application in pre-litigation cases falling within the jurisdiction of any Court for which the Lok Adalat is organized, can refer the matter to the Lok Adalat, after giving a reasonable opportunity to be heard to the other party, and on being satisfied that such matter needs to be determined by the Lok Adalat.
5. Thus, the Lok Adalat can take cognizance of any matter, provided the court makes a reference in pending cases and the Authority or Committee organizing the Lok Adalat refers to pre-litigation cases as contemplated under sub-section (1) or (2) of Section 20.
6. Every Lok Adalat, while determining any reference, has to act with utmost expedition to arrive at a compromise or settlement between the parties and shall be guided by the principles of justice, equity, fair play and other legal principles.
7. The Lok Adalat must inquire whether the parties have understood the contents of the compromise or settlement and whether they have willingly signed.
8. Only to show more figures of disposal of cases in Lok Adalat, matters cannot be listed before Lok Adalat in undue haste without following the due procedure contemplated under Section 20 of the said Act.
Accordingly, the Court opined that in the present case, there was neither an order of reference as contemplated under Section 20(1) of the Act nor an award made by the Lok Adalat. Further, it was concluded that there was complete disregard to the procedure envisaged under the Act. Hence, the Petition was allowed and the order passed by the Lok Adalat was quashed.
Cause Title: Madhukar Baburao Shete v. Yogesh Trimbal Shete and Anr. (Neutral Citation: 2024:BHC-AS:33375)
Appearances:
Petitioner: Advocate Sujeet R Bugade
Respondents: Advocates Jay Patil, Vishal Kanade and Barsha Parulekar.