Mandatory Procedures Cannot Be Bypassed To Show Large Number Of Case Disposals In Lok Adalat: Bombay High Court

The Bombay High Court has observed that the Authority or Committee organising Lok Adalat cannot directly transfer pending cases to the Lok Adalat without a reference order from the concerned court, as stipulated under Section 20(1) of the Legal Services Authorities Act, 1987.

The Court emphasised that the mandatory procedures outlined in the Act cannot be bypassed only to show high figures of disposal of cases, as it would defeat the very purpose of Lok Adalat.

Justice Gauri Godse was considering the petitioner's challenge to the Award passed by Lok Adalat, which disposed the suit in terms of settlement arrived between the petitioner and respondent.

In a suit filed by the respondent before Judicial Magistrate First Class (JMFC), the court had disposed the suit based in terms of compromise between the parties. The petitioner contended that he never received any suit summons from JMFC and that no reference was made by JMFC as per Section 20 of the Legal Services Authorities Act.

Reference order by a concerned court

The Court referred to Section 19(5) of the Act, which is about the jurisdiction of Lok Adalat to determine and arrive at a settlement between the parties. It has jurisdiction in two circumstances as provided in sub-clauses (i) and (ii) of Section 19(5). First, in pending cases before the court for which the Lok Adalat is organised and Second, in pre-litigation cases i.e., cases falling within the jurisdiction of court but not brought before the court.

The Court noted that under both these circumstances, the Lok Adalat can take cognizance of the cases as per Section 20 (1) or (2) of the Act. Under Section 20(1), if the case is pending before a Court, first, the parties can agree to refer the case to Lok Adalat or one of the parties can make an application and if the Court is prima facie satisfied that there are chances of settlement, second, if the court it satisfied that the case is appropriate for Lok Adalat to take cognisance, the Court can refer the matter to Lok Adalat.

Under Section 20(2), if the Authority/Committee which is organising the Lok Adalat receives application in pre-litigation cases as per Section 19(5)(ii), such Committee can refer the matter to Lok Adalat for its determination.

The Court stated that the Committee must follow the procedure as provided in Section 20. It noted that the in the absence of any valid order by a court making reference under Section 20(1), the Committee cannot transfer the pending cases to the Lok Adalat.

It remarked “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.”

In the present case, the Court noted that there was no order of reference by a concerned court to the Lok Adalat under Section 20(1). It held that in absence of a valid order by the concerned court, the Committee had no authority to transfer the pending cases to the Lok Adalat.

Undue haste

The Court remarked that the Lok Adalat cannot list matters without following due procedure as under Section 20, only to show high number of disposal of cases.

“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.”

In the present case, it observed that the approach adopted by the concerned court, Committee and Lok Adalat panel showed 'undue haste' only for the purpose of showing that a large number of cases were disposed in the Lok Adalat.

It further stated “A complete disregard for the procedures under the said Act read with the relevant provisions of CPC, has defeated the very object and purpose of the Lok Adalat.”

The Court held that the order of JMKC disposing the suit was without jurisdiction and that the award of the Lok Adalat was illegal.

Compromise before Lok Adalat must satisfy same test as Order XXIII Rule 3 of CPC

The Court stated that the compromise recorded before the Lok Adalat must satisfy the same test as laid down under Rule 3 of Order XXIII of CPC.

It referred to the case of Namdeo Hambira Babar and Others vs. Gajanan Bhauso Babar and Others (2015 (1) Mh. L. J. 932), where the Division Bench of Bombay High Court had held that under Order XXIII Rule 3 of CPC, a court cannot pass a decree of compromise unless the compromise is lawful.

Here, the court stated that even Lok Adalat cannot pass an award of compromise unless it is lawful. It stated that the Lok Adalat must inquire whether the parties have understood the contents of the settlement and whether they have willingly signed it.

The Court thus quashed the order of JMFC and Award of Lok Adalat. It ordered the JMFC to make an inquiry into the legality of compromise between the parties as contemplated under Order XXIII Rule 3 of CPC.

Case title: Madhukar Baburao Shete vs. Yogesh Trimbak Shete & Anr. (Writ Petition No. 3743 of 2021)

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