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Lok Adalat Can Only Dispose Of Settled Cases, If Settlement Does Not Happen Case To Be Sent Back To Court For Disposal: Gujarat High Court

LIVELAW NEWS NETWORK

14 Sept 2024 9:00 PM IST

    • Lok Adalat Can Only Dispose Of Settled Cases, If Settlement Does Not Happen Case To Be Sent Back To Court For Disposal: Gujarat High Court

    While allowing a plea against a trial court order which in its Lok Adalat jurisdiction had dismissed a cheque bouncing complaint on account of non-prosecution, the Gujarat High Court observed that the work of a Lok Adalat is only to dispose of matters which have been settled between the parties. In the absence of such a settlement, the matter is to be referred back to the court for disposal,...

    While allowing a plea against a trial court order which in its Lok Adalat jurisdiction had dismissed a cheque bouncing complaint on account of non-prosecution, the Gujarat High Court observed that the work of a Lok Adalat is only to dispose of matters which have been settled between the parties. 

    In the absence of such a settlement, the matter is to be referred back to the court for disposal, the court added.

    Referring to the provisions of the Legal Services Authorities Act and decisions of the high court, a single judge bench of Justice MK Thakker in its order said, that the matters which are referred to the Lok Adalat for disposal are those where "settlement or compromise" has been made between the parties.

    "...however, in the event when compromise is not arrived, then it should be referred to the court as provided under Section 20(5) of the Legal Service Authority Act, for disposal in accordance with law," the court underscored. 

    The high court thereafter said that the "work" of Lok Adalat is only to "dispose" of the case where a settlement is arrived at. It noted that in the present matter no settlement had been arrived at between the concerned parties. It said that the trial court while sitting in Lok Adalat by exercising powers under section 256 Cr.P.C. had disposed of the same. 

    Observing that the trial court's order is "without jurisdiction" the high court set it aside. 

    Background

    The high court's order came in an appeal challenging a trial court order which while sitting in its Lok Adalat jurisdiction had dismissed a criminal complaint on account of non prosecution. 

    The complainant claimed that he had lent Rs. 10 Lakh to the respondent accused; the latter had in turn for repayment issued a cheque in the complainant's favour which was dishonoured due to insufficient funds. 
    A complaint was filed under Negotiable Instruments Act before the trial court which had issued summons in June 2015; subsequently in 2018 it had dismissed the complaint while sitting in a special sitting after  "recording the absence of the complainant" and had "acquitted" the respondent accused. 
    Contentions
    The appellant contended that there was no notice issued by the trial court while referring the matter to the Lok Adalat. It was further contended that as there was no settlement the Lok Adalat would not have any jurisdiction to dismiss the complaint for non-prosecution while recording the absence. It was submitted that as per Section 19 and 20 of the Legal Service Authorities Act in the event when the matter is not settled between the parties, the Court would not have jurisdiction except to return the case to the regular court for deciding the same on merits. 
    Meanwhile the respondent submitted that along with cases where settlement has happened the Lok Adalat would have jurisdiction to dispose of "petty cases" which have remained as "dead wood". As the complainant did not appear for a long time, the trial court had considered the same as a dead wood case and referred it to the Lok Adalat where complaint was dismissed. 
    It was further submitted that while Lok Adalat would not have powers to dismiss the complaints on merits but when in an instance where the complainant did not appear before the Court, then the dismissal of the complaint for non-prosecution cannot be termed as one which was "ordered on merits". 
    Findings
    After hearing the submissions by the counsel for the parties and perusing the record, the court noted that after the complaint was filed the trial court had issued summons in June 2015. The accused had appeared before the trial court and the record showed that the case was posted thereafter for the complainant's evidence and on "certain occasions absence of the complainant is recorded".
    However, the high court said, it transpired that there was "no continuous absence of complainant" and his advocate had appeared do have remained present on "almost every occasion".
    The matter was thereafter referred to the Lok Adalat by the learned trial court, however, the high court said, the record "did not indicate any notice" issued by the trial court by referring the matter to Lok Adalat. Additionally the high court noted that the trial court had dismissed the complaint in 2018 while sitting in the Lok Adalat jurisdiction.
    The high court referred to Sections 19, 20 and 21 of the Legal Services Authorities Act. Sections 19 pertains to Organisation of Lok Adalats, 20 pertains to Cognizance of cases by Lok Adalats and 21 pertains to Award of Lok Adalat. 

    Section 19(5), the high court said, provides that Lok Adalat shall have jurisdiction to determine and to arrive at a compromise or settlement between the parties to a dispute in respect of any case pending before or any matter falling within the jurisdiction of and is not brought before any court for which Lok Adalat is organized.

    Section 20 provides that cases are to be referred to the Lok Adalat where the parties have agreed or one of parties would make an application to the court. The proviso to section 20(1) provides that no case shall be referred to the Lok Adalat under sub clause (b) of clause 1 and clause 2 by such court except after giving the reasonable opportunity to the parties of being heard.

    Section 20(5) also provides that where no award has been made by the Lok Adalat on account of no compromise or settlement between the parties, the record of the case shall be returned by it to the court from which the reference has been received for disposal in accordance with law.

    With respect to the respondent's reliance on a case where it was held that a dead wood case can be put to an end in the special sitting of Lok Adalat, the high court observed, "...it may be a short cut to dispose of the matter by snap judgment but the same is not in accordance with law. As the Legal Service Authority Act  prohibits the learned court to disposing of the case where no settlement has arrived adopting the mode in the Lok Adalat while in a special sitting is contrary to the provisions of the Act". 

    Allowing the appeal the high court directed that the complaint be restored to its original file and be decided on its merits.

    "As the case is pending since 2013 learned trial court is directed to dispose of the same, as expeditiously as possible, preferably within a period of eight months from the date of this order, after providing reasonable opportunity to the parties to adduce their evidence," the high court added. 

    Case title: SATISHBHAI SHANTILAL MEHTA v/s  STATE OF GUJARAT & ANR.
    LL Citation: 2024 LiveLaw (Guj) 130
    Click To Download Order
    Tags
    gujarat high courtLok AdalatSettlement between partiesNegotiable Instruments Act#cheque bouncingDismissed For Non-ProsecutionLegal Services Authorities Act2024 livelaw (Guj) 130
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