A Division Bench of Apex Court comprising of Justice M R Shah and Justice A S Bopanna has observed in the case of Estate Officer v. Colonel HV Mankotia (Retired) that Lok Adalat has no jurisdiction at all to decide the matter on merits once it is found that compromise or settlement could not be arrived at between the parties.
The Court further observed that the jurisdiction of the Lok Adalat would be to determine and to arrive at a compromise or settlement between the parties to a dispute. The Apex Court also added that once the settlement/compromise fails, the Lok Adalat has to return the case to the Court from which the reference was received.
Factual Background
Feeling aggrieved and dissatisfied with the impugned order passed by the High Court of Madhya Pradesh, Bench at Indore by which in a Lok Adalat held the members of the Lok Adalat has entered into the merits of the writ petition and has dismissed the said writ petition preferred by the appellant on merits, the original writ petitioner has preferred the present appeal.
That the appellant herein filed a writ petition before the High Court. The matter was listed on 30.11.2013 before the Lok Adalat. By the impugned order, the members of the Lok Adalat held by the High Court entered into the merits of the writ petition and dismissed the same on merits, which is the subject matter of the present appeal. That thereafter the appellant filed the restoration application before the High Court to restore the main writ petition submitting that the order passed in the Lok Adalat is beyond the jurisdiction of the Lok Adalat and, therefore, the same is not legal in the eyes of law. However, the said application came to be dismissed by the High Court and hence the present appeal.
Reasoning and Decision of the Court
The short question which is posed for consideration of this Court is whether in the Lok Adalat held by the High Court, was it open for the members of the Lok Adalat to enter into the merits of the writ petition and to dismiss the same on merits, in absence of any settlement arrived at between the parties?
While answering the aforesaid question, the relevant provisions of the Legal Services Authorities Act, 1987 (Sections 19, 20).
The Court held that,
"Thus, a fair reading of the aforesaid provisions of the Legal Services Authorities Act, 1987 makes it clear that the jurisdiction of the Lok Adalat would be to determine and to arrive at a compromise or a settlement between the parties to a dispute and once the aforesaid settlement/compromise fails and no compromise or settlement could be arrived at between the parties, the Lok Adalat has to return the case to the Court from which the reference has been received for disposal in accordance with law and in any case, the Lok Adalat has no jurisdiction at all to decide the matter on merits once it is found that compromise or settlement could not be arrived at between the parties.”
The Bench then enunciates in para 8 that,
“Identical question came to be considered by this Court in the case of State of Punjab and Ors. Vs. Ganpat Raj (supra) and after considering Section 20 of the Act, 1987, it is observed and held in paragraph 7 as under:-
“7. The specific language used in sub-section (3) of Section 20 makes it clear that the Lok Adalat can dispose of a matter by way of a compromise or settlement between the parties. Two crucial terms in sub-sections (3) and (5) of Section 20 are “compromise” and “settlement”. The former expression means settlement of differences by mutual concessions. It is an agreement reached by adjustment of conflicting or opposing claims by reciprocal modification of demands. As per Termes de la Ley, “compromise is a mutual promise of two or more parties that are at controversy”. As per Bouvier it is “an agreement between two or more persons, who, to avoid a law suit, amicably settle their differences, on such terms as they can agree upon”. The word “compromise” implies some element of accommodation on each side. It is not apt to describe total surrender. (See NFU Development Trust Ltd., Re [(1973) 1 All ER 135 : (1972) 1 WLR 1548 (Ch D)] ). A compromise is always bilateral and means mutual adjustment. “Settlement” is termination of legal proceedings by mutual consent. The case at hand did not involve compromise or settlement and could not have been disposed of by the Lok Adalat. If no compromise or settlement is or could be arrived at, no order can be passed by the Lok Adalat. Therefore, the disposal of Civil Writ Petition No. 943 of 2000 filed by the respondent is clearly impermissible.””
The Court further observed that,
“In view of the above, the impugned order passed by the Lok Adalat dismissing the writ petition on merits is unsustainable and deserves to be quashed and set aside. The submission made by the learned counsel appearing on behalf of the respondent that once the matter was placed before the Lok Adalat with consent, thereafter the entire matter is at large before the Lok Adalat and, therefore, the Lok Adalat is justified in disposing the matter on merits has no substance and the same is required to be rejected outright. The consent to place the matter before the Lok Adalat was to arrive at a settlement and or a compromise between the parties and not for placing the matter before the Lok Adalat for deciding the matter on merits. Once there is no compromise and/or a settlement between the parties before the Lok Adalat, as provided in sub-section (5) of Section 20, the matter has to be returned to the Court from where the matter was referred to Lok Adalat for deciding the matter on merits by the concerned court.”
Held
In view of the above and for the reasons stated above, the impugned order passed by the Lok Adalat, Madhya Pradesh High Court was quashed and set aside. The matter was remanded to the High Court to decide the Writ Petition on merits and in accordance with the law. The Writ Petition was ordered to be restored to the file of the High Court for its decision on merits and in accordance with the law. The present appeal was accordingly allowed. In the facts and circumstances of the case, there shall be no order as to costs. Pending applications, if any, also stand disposed of.
Case Details
Case Name: Estate Officer v. Colonel HV Mankotia (Retired)
Case Number: Civil Appeal No. 6223 of 2021
Date of Decision: October 7, 2021
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