Lok Adalat Awards Deemed Decrees, Further Appeals U/S 96 CPC Not Allowed: Jammu & Kashmir High Court

Justice Wasim Sadiq Nargal noted that an award of the Lok Adalat can only be challenged if there is an allegation of fraud or if the agreement forming the basis of the decree is invalid.

"Section 21 of the Legal Services Authorities Act, 1987 equates an award of the Lok Adalat, to a decree of a Civil Court and imputes an element of finality to an award of compromise passed by the Lok Adalat…Given the element of finality attached to an award of the Lok Adalat, it also follows that no appeal would lie, under Section 96 of the CPC against such award"

The observations were made while hearing a plea challenging two orders: one passed by a Lok Adalat on May 9, 2015 and another by a District & Sessions Judge on November 17, 2017, related to the release of an outstanding payment of Rs. 3 lakhs to the petitioner. 

The respondent contractor had sought the recovery of Rs.3 lakhs from the petitioners for a road construction project completed in 2008. A Lok Adalat issued a compromise decree, directing payment within three months. When this directive wasn't adhered to, an execution petition was filed. The executing court extended the claim to Rs.10.00 lacs from the judgment-debtor, deviating significantly from the initial Rs.3.00 lacs.

The petitioners argued that the J&K Legal Services Authority failed to provide them with an opportunity to be heard before referring the matter to Lok Adalat, violating Section 19(1) of the J&K Legal Services Authority Act, 1997. They further contended that Lok Adalat's jurisdiction is limited to settling disputes through compromise or settlement, not by making unilateral decisions based on alleged documents.

In response, the respondents challenged the maintainability of the writ petition, questioning whether it was filed under Section 103 or Section 104 of the erstwhile Constitution of J&K. They argued that none of the petitioners' fundamental rights were violated, rendering Section 103 of the erstwhile Constitution of J&K inapplicable. Additionally, the respondents pointed out the limitations of invoking Section 104 of the erstwhile Constitution of J&K, similar to Article 227 of the Indian Constitution, for maintaining the petition in light of amendments to Section 115 of the CPC.

After conducting an analysis of the Lok Adalat's authority and delving into the nuances of the Legal Services Authorities Act, Justice Nargal emphasised that Lok Adalat awards were equivalent to Civil Court decrees and held an indisputable finality. In the absence of fraud or an explicit appeal provision, the Lok Adalat's decisions were not subject to further challenge, the bench underscored.

Referring to Section 21 of the Legal Services Authorities Act, 1987, the court specified that Lok Adalat's awards were tantamount to decrees and were conclusive, respecting the principle that "reason is the soul of the law."

Deliberating on the issue of enhancement of the amount from 3 lakh fixed by the Lok Adalat to 10 Lakh by the Executing court the bench observed,

"The executing court by no stretch of imagination could have entertained the said execution petition in the light of the specific statement by the petitioner, whereby, the deceased has declined to charge any interest on the amount and thus, the order passed by the executing court was beyond what has already been ordered by way of compromise decree by both the parties".

Expounding on the filing of a writ petition under Section 103/104 of the erstwhile State of J&K Constitution, akin to Article 227 of the Indian Constitution, the court said that the same is not allowed when a statutory appeal is available or expressly barred. Section 104's scope, similar to Article 227, has been curtailed by the Supreme Court, discouraging its use in light of the amendment of Section 115 of the CPC, the bench spotlighted.

In view of the same, it found the writ petition devoid of any merit and dismissed it. The Lok Adalat's order dated 09.05.2015, where the deceased declined interest, was upheld and the petitioners were directed to pay Rs. 3 lakhs to respondents within one month and the Executing court's order of 12.12.2017, attaching the account with interest, was set aside.

Case Title: Chief Engineer PWD Kashmir Vs Fahmeeda Begum W/o Lt. Mohammad Naseem Khan R/o Pahlipora Boniyar.

Citation: 2023 LiveLaw (JKL) 267

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