SC: Only Remedy Against A Lok Adalat Award Is To Invoke High Court’s Supervisory Jurisdiction

Summary:

The core issue is the validity of a compromise decree passed by the Lok Adalat in 2022, which the Appellant claims was obtained fraudulently and impacted his property rights as a third party. The SC examines whether the High Court was justified in dismissing the appellant’s challenge because he had already filed objections in the execution proceedings. Ultimately the SC, rules that a challenge to a Lok Adalat award on grounds of fraud, must be pursued via a writ petition before the High court, not merely though objections in the executing court, and remands the case back for a fresh hearing on the merits.

Facts

• The appellant claims title to an immovable property at Jabalpur. On 29.11.2008, a power of attorney in respect of the property was executed in favour of Respondent No. 3, Virendra Patel, pursuant to which an agreement to sell dated 21.01.2009 was executed by Respondent No. 3 in favour of Respondents No. 1 and 2, Rakesh Gupta and Neeraj Jain. Thereafter, on the basis of the said power of attorney, a sale deed dated 12.06.2009 was executed in favour of one Ganga Prasad Kurariya.
• Disputes arose between Smt. Siya Bai and Ganga Prasad Kurariya, leading to the institution of civil suits by both sides in respect of the same property. In connection therewith, Smt. Siya Bai also lodged an FIR alleging that Respondent No. 3 had impersonated her son and successor and had dealt with the property on the basis of forged and fabricated documents.
• Upon the demise of Smt. Siya Bai, her husband, Shri Bhagwan Patel, claiming to be her sole surviving heir, executed a registered sale deed dated 17.02.2016 in favour of the appellant’s proprietary concern, M/s Rajul Builders, for a consideration of ₹4,20,00,000.
• Respondents No. 1 and 2 asserted rights under the agreement to sell dated 21.01.2009 and instituted a suit for specific performance. In the said suit, a joint application for compromise was filed by the plaintiffs and the defendant, pursuant to which the Lok Adalat passed an award on 14.05.2022. On the strength of the said decree, a registered sale deed was executed in favour of Respondents No. 1 and 2 on 22.07.2022, followed by execution orders directing execution of the sale deed and issuance of warrants for delivery of possession.
• According to the appellant, he became aware of the decree and execution proceedings only when police authorities visited the property to execute the warrants of possession. The appellant thereafter filed objections under Order XXI Rule 101 CPC, upon which the Executing Court directed maintenance of status quo. The appellant also instituted a writ petition before the High Court of Madhya Pradesh.
• By interim order dated 17.10.2022, the learned Single Judge directed maintenance of status quo with respect to possession of the property, stated to be with the appellant, and by judgment dated 27.02.2023 disposed of the writ petition. Aggrieved thereby, the appellant preferred a writ appeal before the Division Bench, in which an interim order of status quo was granted. However, by the impugned judgment dated 06.11.2023, the Division Bench dismissed the writ appeal, affirming the view that since the appellant had already raised objections in the execution proceedings seeking to set aside the decree dated 14.05.2022 on the ground of fraud, he could not maintain parallel proceedings in writ jurisdiction, and further held that Section 22E of the Legal Services Authorities Act did not impose an absolute bar on such recourse.

Issues

1. Whether the High Court was justified in declining to entertain the appellant’s challenge to the Lok Adalat decree on the ground that he had already filed objections before the Executing Court

Judgment

• The judgment rets heavily on the scheme established by LSA 1987. Section 21 of the LSA dictates that every award of a Lok Adalat is deemed to be a decree of a civil court, as it is final and binding on the parties to the dispute and is non-appealable.
• Section 22E of the LSA reinforces this, stating that an award of a Permanent Lok Adalat shall be final and shall not be called in question in any original suit, application or executing proceeding.
• The court, based on precedents, affirmed that the statutory finality attached to Lok Adalat award means no appellate or plenary civil remedy exists against it. The only recognised avenue for challenging its validity, even on grounds of fraud or lack of consent, is through the constitutional jurisdiction of the High Court under Article 226 or 227 of the Constitution.
• The executing court, when dealing with a decree embodying a Lok Adalat award, has a role confined to giving effect to that award in terms of execution. It lacks the authority to annul or set aside award or decree drawn based on it.
• While Order XXI rules 97,99 and 101 of CPC allow the executing court to address incidental questions, they do not authorise the court to reopen the settlement or examine the validity of award itself.

Analysis:

The Central finding is that a Lok Adalat award or decree due to its statutory finality under Section 21 of the LSA Act, cannot be challenged via appeal or any plenary civil remedy. The court clarified that the Executing court lacks authority to set aside Lok Adalat award or the compromise decree based on it. The Supreme Court concluded that the High court was incorrect in dismissing the writ petition on ground that the appellant had filed objections in the execution proceedings. The judgment establishes that statutes like the LSA Act declares a decision to be final and non-appealable, challenging that decision in a lower court like Executing court, then the jurisdiction is entirely inappropriate.