CIVIL

Award of the Lok Adalat is fictionally deemed to be decrees of Court

The award of the Lok Adalat is fictionally deemed to be decrees of Court and therefore the courts have all the powers in relation thereto as it has in relation to a decree passed by itself. This, in our opinion, includes the powers to extend time in appropriate cases. In our opinion, the award passed by the Lok Adalat is the decision of the court itself though arrived at by the simpler method of conciliation instead of the process of arguments in court. The effect is the same. In this connection, the High Court has failed to note that by the award what is put an end to is the appeal in the District Court and thereby the litigations between brothers forever. The view taken by the High Court, in our view, will totally defeat the object and purpose of the Legal Services Authorities Act and render the decision of the Lok Adalat meaningless.

Section 21 of the Legal Services Authorities Act, 1987 reads as follows :-

“21 AWARD OF LOK ADALAT.- 2(1) Every award of the Lok Adalat shall be deemed to be a decree of a Civil Court or, as the case may be, an order of any other Court and where a compromise or settlement has been arrived at, by a Lok Adalat in a case referred on it under sub-section (1) of Sec.20, the court fee paid in such cases shall be refunded; in the manner provided under the Court-fees Act, 1870 (7 of 1870).

(2) Every award made by a Lok Adalat shall be final and binding on all the parties to the dispute, and no appeal shall lie to any Court against the award.

Section 22 reads thus :-

“22. POWERS OF LOK ADALATS – (1) The Lok Adalat shall, for the purposes of holding any determination under this Act, have the same powers as are vested in a Civil Court under the Code of Civil Procedure, 1908 (5 of 1908), while trying a suit in respect of the following matters, namely :

(a) the summoning and enforcing the attendance of any witness and examining him on oath;

(b) the discovery and production of any document;

(c) the reception of evidence on affidavits;

(d) the requisitioning of any public record or document or copy of such record or document from any Court or Office; and

(e) such other matters as may be prescribed.

(2) Without prejudice to the generality of the powers contained in sub-section (1), every Lok Adalat shall have the requisite powers to specify its own procedure for the determination of any dispute coming before it.

(3) All proceedings before a Lok Adalat shall be deemed to be judicial proceedings within the meaning of Secs.193, 219 and 228 of the Indian Penal Code (45 of 1860) and every Lok Adalat shall be deemed to be a Civil Court for the purpose of Sec.195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974).

UNREPORTED JUDGMENTS 2004 (2) VOL 37.”

What is Lok Adalat ?

“The “Lok Adalat” is an old form of adjudicating system prevailed in ancient India and it’s validity has not been taken away even in the modern days too. The word ‘Lok Adalat’ means ‘People Court’. This system is based on Gandhian Principles. It is one of the components of ADR system. As the Indian Courts are over burdened with the backlog of cases and the regular Courts are to decide the cases involve a lengthy, expensive and tedious procedure. The Court takes years together to settle even petty cases. Lok Adalat, therefore provides alternative resolution or devise for expeditious and inexpensive justice.

In Lok Adalat proceedings there are no victors and vanquished and, thus, no rancour.

Experiment of ‘Lok Adalat’ as an alternate mode of dispute settlement has come to be accepted in India, as a viable, economic, efficient and informal one.

LOK ADALAT is another alternative to JUDICIAL JUSTICE. This is a recent strategy for delivering informal, cheap and expeditious justice to the common man by way of settling disputes, which are pending in Courts and also those, which have not yet reached Courts by negotiation, conciliation and by adopting persuasive, common sense and human approach to the problems of the disputants, with the assistance of specially trained and experienced Members of a Team of Conciliators.”

Benefits Under Lok Adalat :

1. There is no Court fee and if Court fee is already paid the amount will be refunded if the dispute is settled at Lok Adalat according to the rules.

2. The basic features of Lok Adalat are the procedural flexibility and speedy trial of the disputes. There is no strict application of procedural laws like Civil Procedure Code and Evidence Act while assessing the claim by Lok Adalat.

3. The parties to the dispute can directly interact with the Judge through their Counsel which is not possible in regular Courts of law.

4. The award by the Lok Adalat is binding on the parties and it has the status of a decree of a Civil Court and it is non-appealable which does not cause the delay in the settlement of disputes finally.

In view of above facilities provided by the ‘Act’ Lok Adalats are boon to the litigating public they can get their disputes settled fast and free of cost amicably.

AWARD OF LOK ADALAT :-

The Lok Adalat shall proceed and dispose the case and arrive at a compromise or settlement by following the legal principles, equity and natural justice. Ultimately the Lok Adalat passes an award, and every such award shall be deemed to be a decree of Civil Court or as the case may be which is final.

AWARD OF LOK ADALAT SHALL BE FINAL :-

The Lok Adalat will pass the award with the consent of the parties, therefore there is no need either to reconsider or review the matter again and again, as the award passed by the Lok Adalat shall be final. Even as under Section 96(3) of C.P.C. that “no appeal shall lie from a decree passed by the Court with the consent of the parties”. The award of the Lok Adalat is an order by the Lok Adalat under the consent of the parties, and it shall be deemed to be a decree of the Civil Court, therefore an appeal shall not lie from the award of the Lok Adalat as under Section 96(3) C.P.C.

23. In Punjab National Bank vs. Lakshmichand Rah reported in AIR 2000 Madhya Pradesh 301, 304, the High Court held that “The provisions of the Act shall prevail in the matter of filing an appeal and an appeal would not lie under the provisions of Section 96 C.P.C. Lok Adalat is conducted under an independent enactment and once the award is made by Lok Adalat the right of appeal shall be governed by the provisions of the Legal Services Authorities Act when it has been specifically barred under Provisions of Section 21(2), no appeal can be filed against the award under Sec. 96 C.P.C.” The Court further stated that “It may incidentally be further seen that even the Code of Civil Procedure does not provide for an appeal under Section 96(3) against a consent decree. The Code of Civil Procedure also intends that once a consent decree is passed by Civil Court finality is attached to it. Such finality cannot be permitted to be destroyed, particularly under the Legal Services Authorities Act, as it would amount to defeat the very aim and object of the Act with which it has been enacted, hence, we hold that the appeal filed is not maintainable.

The High Court of Andhra Pradesh held that, in Board of Trustees of the Port of Visakhapatnam vs. Presiding Officer, Permanent, Lok Adalat-cum-Secretary, District Legal Services Authority, Visakha-patnam and another reported in 2000(5) ALT 577, “The award is enforceable as a decree and it is final. In all fours, the endeavour is only to see that the disputes are narrowed down and make the final settlement so that the parties are not again driven to further litigation or any dispute. Though the award of a Lok Adalat is not a result of a contest on merits just as a regular suit by a Court on a regular trial, however, it is as equal and on par with a decree on compromise and will have the same binding effect and conclusive just as the decree passed on the compromises cannot be challenged in a regular appeal, the award of the Lok Adalat being akin to the same, cannot be challenged by any regular remedies available under law including invoking Article 226 of the Constitution of India challenging the correctness of the award on any ground. Judicial review cannot be invoked in such awards especially on the grounds as raised in this writ petition.

The award of Lok Adalat is final and permanent which is equivalent to a decree executable, and the same is an ending to the litigation among parties.

 In Sailendra Narayan Bhanja Deo vs. The State of Orissa, AIR 1956 Supreme Court 346, (Constitution Bench) held as follows :

A Judgment by consent or default is as effective an estoppel between the parties as a judgment whereby the court exercises its mind on a contested case. (1895) 1 Ch 37 and 1929 AC 482, Rel. on;

In – ‘In re South American and Mexican Co., Ex. Parte Bank of England’, (1895) 1 Ch 37(C), it has been held that a judgment by consent or default is as effective an estoppel between the parties as a judgment whereby the Court exercises its mind on a contested case. Upholding the judgment of Vaughan Williams, J. Lord Herschell said at page 50 :-

“The truth is, a judgment by consent is intended to put a stop to litigation between the parties just as much as is a judgment which results from the decision of the Court after the matter has been fought out to the end.

And I think it would be very mischievous if one were not to give a fair and reasonable interpretation to such judgments, and were to allow questions that were really involved in the action to be fought over again in a subsequent action.”

To the like effect are the following observations of the Judicial Committee in – ‘Kinch vs. Walvott’, 1929 AC 482 at p. 493 (D) :-

“First of all their Lordships are clear that in relation to this plea of estoppel it is of no advantage to the appellant that the order in the libel action which is said to raise it was a consent order. For such a purpose an order by consent, not discharged by mutual agreement, and remaining unreduced, is as effective as an order of the Court made otherwise than by consent and not discharged on appeal.”

The same principle has been followed by the High Courts in India in a number of reported decisions. Reference need only be made to the cases of – ‘Secy. Of State vs. Ateendranath Das’, 63 Cal 550 at p. 558(E); ‘Bhaishanker vs. Moraji’, 36 Bom 283(F) and ‘Raja Kumara Venkata Perumal Raja Bahadur vs. Thatha Ramaswamy Chetty’, 35 Mad 75(G). In the Calcutta case after referring to the English decisions the High Court observed as follows :

“On this authority it becomes absolutely clear that the consent order is as effective as an order passed on contest, not only with reference to the conclusion arrived at in the previous suit but also with regard to every step in the process of reasoning on which the said conclusion is founded.

When we say ‘every step in the reasoning’ we mean the findings on the essential facts on which the judgment or the ultimate conclusion was founded. In other words the finding which it was necessary to arrive at for the purpose of sustaining the judgment in the particular case will operate as estoppel by judgment”. The Civil Procedure Code contains the following provisions :

“Order 23 Rule 3 provides for compromise of suit- where it is proved to the satisfaction of the Court that a suit has been adjusted wholly in part by any lawful agreement or compromise, written and signed by the parties. The Court after satisfying itself about the settlement, it can convert the settlement into a judgment decree.”


AIR 2005 SC 3575 : (2005) 2 Suppl. SCR 20 : (2005) 6 SCC 478 : JT 2005 (10) SC 304 : (2005) 6 SCALE 85

Categories: CIVIL