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CASE NO.: Appeal (civil)  4677 of 2005

PETITIONER: P.T. THOMAS                                                          

RESPONDENT: THOMAS JOB                                                  

DATE OF JUDGMENT: 04/08/2005

BENCH: RUMA PAL & Dr. AR. LAKSHMANAN

JUDGMENT: JUDGMENT (ARISING OUT OF S.L.P (C) No..20179/2003)

Dr.AR. LAKSHMANAN,J.         Leave granted.         The above appeal is directed against the final order of the High Court  of Kerala at Ernakulam dated 27.8.2003 in CRP No. 1136/2003 allowing the  Revision Petition filed by the Respondent herein.

       The Appellant and the Respondent are brothers, Respondent being the  elder.  They have another brother who is well employed in the United States.   The three brothers partitioned the property left behind by their father by  metes and bounds.  The Respondent was running a theatre.  A part of the  theatre fell in the property allotted to the appellant.  Since Respondent did  not vacate and give vacant possession to the Appellant, he was constrained  to file a suit for a mandatory injunction for removal of the building and to  surrender vacant possession.  The Appellant also prayed for a decree for  recovery of possession.          The appellant’s suit was decreed as prayed for.   When the matter was  pending in appeal at the instance of the Respondent in the District Court, the  dispute was referred to the Lok Adalat constituted under the Legal Services  Authorities Act for resolution of the dispute.  The matter was settled in the  Lok Adalat.  The award of the Lok Adalat dated 5.10.1999 provided for sale  to the Appellant or his nominee of the property scheduled to the award after  a period of one year and within a period of two years on payment of a sum  of Rs. 9.5 lakhs to the Respondent and on default of the Respondent to  execute the document, the appellant could get it executed through court.  On  the other hand, in case of default on the part of the appellant, he had to give  up his aforesaid right and instead be entitled to be paid   to Rs. 3.5 lakhs by  the Respondent.         The Respondent did not execute the sale deed within the time fixed  despite repeated requests by the Appellant.  The Appellant, therefore, sent a  lawyer’s notice on 3.10.2001 to the Respondent calling upon him to execute  the sale deed.  Respondent did not receive the notice and the notice was  returned unserved to the Appellant.  The Appellant thereafter sent a telegram  on 26.10.2001 requiring the Respondent to execute the sale deed and also  sent him a copy of his earlier notice dated 3.10.2001 by certificate of  posting.  There was no response from the Respondent.  The Appellant was,  therefore, constrained to move for execution of the award by filing petition  in the Trial Court, which was opposed on various grounds.  The Subordinate  Judge overruled all the objections and the appellant was directed to deposit a  sum of Rs. 9.5 lakhs within three days i.e., on or before 8.4.2003.  The  Appellant, however, deposited the amount one day earlier on 7.4.2003 the  next working day.  But, the High Court allowed the Revision   filed by the  Respondent and dismissed the execution petition on grounds, which  according to the Appellant, are irrelevant and incorrect.  Hence, the  Appellant preferred the above special leave petition.         We have heard Mr. TLV Iyer, learned senior counsel for the

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Appellant and Mr. M.P.Vinod, learned counsel for the Respondent and  perused the pleadings, orders passed by the courts below and the Annexures  filed along with the appeal. Mr. TLV Iyer, learned senior counsel appearing for the Appellant  submitted that the High Court has exceeded its jurisdiction under Section  115 C.P.C in entering into the investigation of questions of fact and  appraisal of evidence in setting aside the well considered order of the  Executing Court.   He further submitted that the High Court is in error in  holding that the Appellant did not have the funds with him to have the deed  of sale executed in his favour and the reasoning and the premises on which  such a conclusion is based are faulty and fallacious besides being beyond  jurisdiction.  It is further submitted that the Respondent had not performed  his obligations by evincing his willingness to execute the sale deed on  receipt of the amount of Rs. 9.5 lakhs.  Concluding his arguments, Mr Iyer  submitted that the view taken by the High Court would totally defeat the  object and purposes of the Legal Services Authorities Act and render the  decisions of the Lok Adalat meaningless.         Per contra, Mr. Vinod, learned counsel for the Respondent submitted  that the appellant has not paid the sum of Rs. 9.5 lakhs after one year from  the date of the award, namely, 5.10.1999 and at any rate within two years  therefrom.  It is further submitted that the appellant also did not deposit the  amount before filing the execution petition as contemplated in the award.   Even when he was examined in court on 22.2.2003, he had not deposited the  said amount.  According to Mr. Vinod, the award of the Lok Adalat cannot  be equated with a decree and it only incorporates an agreement between the  parties and that in case of any violation of the said agreement, or the terms  of the compromise recorded in the award, the parties lose their right to get  the same executed and the compromise stands withdrawn.  It is further  argued that the Appellant admittedly had not produced any material to show  that the Appellant had the resources to pay the said amount at any relevant  point of time or that the said amount was ever offered to the respondent at  any point of time and, therefore, the appellant is not entitled to any relief in  this appeal.

       It is further submitted that there is no effective service of any notice  on the Respondent before 5.10.1999 and the only endorsement is that the  Respondent was absent.  It is submitted that the Appellant never had the  money with him and the belated payment after the order of the executing  court will not improve the case of the Appellant to prove his readiness and  willingness to deposit a sum of Rs. 9.5 lakhs as agreed upon by him, and on  the date specified, on the basis on which the matter was compromised before  the Lok Adalat and an award was passed.  Concluding his arguments,  learned counsel submitted that there is no merit whatsoever in the grounds  raised in this appeal and therefore, the appeal, which is clearly without any  merits, deserves to be dismissed.

       We have carefully considered the rival submissions made by both the  learned counsel.  We do not find any merit in the submissions made by  learned counsel for the Respondent.  From the evidence and the documents  filed, we see bona fides on the part of the appellant in giving effect to the  compromise arrived at between parties in the Lok Adalat.  We also see  absolute merits on the submissions made by learned senior counsel, Mr.  TLV Iyer.

       It is seen from the records that the Appellant was compelled to file the  suit for recovery of possession of Plot No. 2 since the Respondent herein  refused to comply with the terms of the compromise arrived at between the  parties.  The suit was decreed on 26.7.1990 and appeal was filed by the  Judgment Debtor \026 Respondent before the District Court and during the  pendency of the appeal the matter was compromised between parties on  5.10.1999.  We have already extracted the terms of compromise in  paragraph supra.  It is thus clear that the decree holder Appellant has  approached the executing court on the ground that the Judgment debtor/  Respondent  failed to execute the sale deed after receiving Rs. 9.5 lakhs  from the decree holder.  Therefore the Appellant prayed before the

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Executing Court that he should be permitted to deposit Rs. 9.5 lakhs in that  court and get the documents executed through court if the Judgment debtor  failed to do so on issuance of notice for the purpose by the executing court.   The respondent submitted that the compromise arrived at is a conditional  one and Judgment debtor is liable to execute the sale deed in favour of the  decree holder only if he remits the amount as agreed, and since decree  holder has failed to comply with the conditions the Judgment debtor is not  bound by the terms of the compromise.  On the other hand the    respondent/J.D. was ready and willing to deposit Rs.3.5 lakhs before the  executing court as per the terms of the compromise.

       Before the executing Court witnesses were examined on both sides  and Exhibit A1 to A8 and B1 were produced by the respective parties.  The  executing court, accepting the evidence of PW 1 came to the conclusion that  the notice issued requiring the respondent to execute the document as  submitted in the award was not received by the Judgment debtor and it has  been returned unclaimed.  It is seen that notice was an attempt to be served  on the Judgment debtor on 4.10.2001 and since he was absent, intimation  regarding the notice has been given and the above notice has been returned  as unclaimed on 19.10.2001.  The Appellant after return of the Exhibit A2  notice immediately sent a telegram to the Judgment debtor on 26.1.2001.   The receipt issued for the telegram and certified true copy of the telegram  was marked as Exhibit A3 and A4.  The Original telegram was produced on  the side of the Respondent and marked as an Exhibit.  By the telegram the  Judgment debtor was intimated that the notice sent by the decree holder  through his Advocate on 3.10.2001 was returned unclaimed and copy of that  notice was being forwarded by certificate of posting and that he was always  ready and willing to pay Rs. 9.5 lakhs and get the sale deed executed in  terms of the award.  The copy of the Exhibit A2 notice is marked as A5, the  certificate of posting obtained for issuing the copy of notice along with the  copy of the telegram is marked as Exhibit A6.  Thus, it is clearly seen that  the appellant decree holder has expressed his readiness and willingness to  deposit the amount as per the award and get the document executed.

       It is argued on the side of the Respondent that the Appellant has not  sufficient fund to fulfill the obligation as per the award and that the  Appellant had issued a notice and telegram so as to create some records in  his favour that he is always willing and ready   to pay the amount as per the  award.  It is submitted that it is only due to the default of the Appellant the  execution of the sale deed has not taken place and therefore, the Appellant is  not entitled to any relief in this appeal.  The learned Subordinate Judge on a  consideration of the entire evidence placed on record granted the Appellant  three days time to deposit Rs. 9.5 lakhs before the said court upon which he  could get the sale deed through court as stipulated in the award.  The  appellant as directed by the learned Subordinate Judge deposited the entire  sum of Rs. 9.5 lakhs in the sub-court on 7.4.2003 as could be seen from  Annxure 6.

       We have also perused the order of the learned Single Judge of the  High Court in revision.  The learned Single Judge, in our view, has  misunderstood the terms of the award.  The obligation was on the  Respondent to evince his willingness to execute the sale deed within two  years and not vice-versa as assumed by the High Court.  There was already a  decree of ejectment against the Respondent in the suit in the trial Court and  it was his appeal that was sought to be settled in the Lok Adalat.  The  settlement was a concession in his favour giving a breathing time to vacate  and give vacant possession.  Therefore, the initiative had to come from the  Respondent after offering to execute the sale deed where upon it became  necessary to comply with his obligations.  However, without taking any  initiative the Respondent has adopted the delaying tactics by alleging that  the appellant was not able to provide the requisite funds for purchase and  forgetting the facts that the Appellant’s brother is in USA and providing the  requisite funds for purchase.  It was he, in fact, who had provided the  amount which was deposited on 7.4.2003 and not on 8.4.2003 as assumed by  the High Court.  It is, thus, seen that the Appellant has performed his

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obligation. He had sent the notice on 3.10.2001 and it was 4.10.2001 well  before the expiry of time on 5.10.2001.  Though the notice was correctly  addressed and despite the intimation by the post office, the notice was not  accepted by the Respondent and was returned unserved.  In such  circumstances, the presumption of law is that the notice has been served on  the Respondent.   

The High Court, in our view, has also misinterpreted Section 27 of the  Post Office Act.  The requirement of Section has been complied with in this  case.  The reasoning of the High Court on this issue is not correct and not in  accordance with factual position.  In the notice issued, the Postman has  made the endorsement.  This presumption is correct in law.  He had given  notice and intimation.  Nevertheless, the respondent did not receive the  notice and it was returned unserved.  Therefore, in our view, there is no  obligation cast on the appellant to examine the Postman as assumed by the  High Court.  The presumption under Section 114 of the Evidence Act  operates apart from that under the Post Office Act.   

In our opinion, the award of the Lok Adalat is fictionally deemed to  be decrees of Court and therefore the courts have all the powers in relation  thereto as it has in relation to a decree passed by itself.  This, in our opinion,  includes the powers to extend time in appropriate cases.    In our opinion, the  award passed by the Lok Adalat is the decision of the court itself though  arrived at by the simpler method of conciliation instead of the process of  arguments in court.  The effect is the same.  In this connection, the High  Court has failed to note that by the award what is put an end to is the appeal  in the District Court and thereby the litigations between brothers forever.   The view taken by the High Court, in our view, will totally defeat the object  and purposes of the Legal Services Authorities Act and render the decision  of the Lok Adalat meaningless.

Section 21 of the Legal Services Authorities Act, 1987 reads as follows :-

       "21. AWARD OF LOK ADALAT. \026 2[(1)] Every award  of the Lok Adalat shall be deemed to be a decree of a Civil  Court or, as the case may be, an order of any other Court and  where a compromise or settlement has been arrived at, by a Lok  Adalat in a case referred on it under sub-section (1) of Sec.20,  the court fee paid in such cases shall be refunded; in the manner  provided under the Court Fees Act, 1870 (7 of 1870)

      (2) Every award made by a Lok Adalat shall be final and  binding on all the parties to the dispute, and no appeal shall lie  to any Court against the award.

Section 22 reads thus :-

       "22. POWERS OF LOK ADALATS  - (1) The Lok  Adalat shall, for the purposes of holding any determination  under this Act, have the same powers  as are vested in a Civil  Court under the Code of Civil Procedure, 1908 (5 of 1908),  while trying a suit in respect  of the following matters, namely :          (a)     the summoning and enforcing the attendance  of any witness                          and examining him on oath; (b)     the discovery and production of any document ; (c)     the reception of evidence on affidavits ; (d)     the requisitioning  of any public record or document or copy                of such record or document from any Court or Office; and   (e)     such other matters as may be prescribed.

(2) Without prejudice to the generality of the powers contained  in sub-section (1), every Lok Adalat shall have the requisite  powers to specify its own procedure for the determination of

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any dispute coming before it.   (3)  All Proceedings before a Lok Adalat shall be deemed to be  judicial proceedings within the meaning of Secs. 193, 219 and  228 of the Indian Penal Code (45 of 1860) and every Lok  Adalat shall be deemed to be a Civil Court for the purpose of  Sec. 195 and Chapter XXVI of the Code of Criminal Procedure,  1973 (2) of 1974). UNREPORTED JUDGEMENTS 2004 (2) VOL 37."

What is Lok Adalat? :

       "The "Lok Adalat" is an old form of adjudicating system  prevailed in ancient India and  it’s validity has not been taken  away even in the modern days too.  The word ’Lok Adalat’  means ’People Court’.  This system is based on Gandhian  Principles.  It is one of the components of ADR system.  As the  Indian Courts are over burdened with the backlog of cases and  the regular Courts are to decide the cases involve a lengthy,  expensive and tedious procedure.  The Court takes years  together to settle even petty cases.  Lok Adalat , therefore  provides alternative resolution or devise for expedious and  inexpensive justice.

In Lok Adalat proceedings there are no victors and  vanquished and, thus, no rancour.

Experiment of ’Lok Adalat’ as an alternate mode of  dispute settlement has come to be accepted in India, as a viable,  economic, efficient and informal one.

LOK ADALAT is another alternative to JUDICIAL  JUSTICE.  This is a recent strategy for delivering informal,  cheap and expeditious justice to the common man by way of  settling disputes, which are pending in Courts and also those,  which have not yet reached Courts by negotiation, conciliation  and by adopting persuasive, common sense and human  approach to the problems of the disputants, with the assistance  of specially trained and experienced Members of a Team of  Conciliators."

Benefits Under Lok Adalat:

1.      There is no Court fee and if  Court fee is already paid the  amount will be refunded if the dispute is settled at Lok Adalat  according to the rules. 2.      The basic features of Lok Adalat are the procedural flexibility  and speedy trial of the disputes.  There is no strict application of  procedural laws like Civil Procedure Code and Evidence Act  while assessing the claim by Lok Adalat. 3.      The parties to the dispute can directly interect with the Judge  through their Counsel which is not possible in regular Courts of  law. 4.      The award by the Lok Adalat is binding on the parties and it  has the status of a decree of a Civil Court and it is non- appealable which does not causes the delay in the settlement of  disputes finally.

In view of above facilities provided by the ’Act’ Lok Adalats are boon to the  litigating public they can get their disputes settled fast and free of cost  amicably.

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AWARD OF LOK DALAT  :-

The Lok Adalat shall proceed and dispose the cases and arrive at a  compromise or settlement by following the legal principles, equity and  natural justice.  Ultimately the Lok Adalat passes an award, and every such  award shall be deemed to be a decree of Civil Court or as the case may be  which is final.

AWARD OF LOK ADALAT SHALL BE FINAL :-

    The Lok Adalat will passes the award with the consent of the  parties, therefore there is no need either to reconsider or review the matter  again and again, as the award passed by the Lok Adalat shall be final.  Even  as under Section 96(3) of C.P.C. that "no appeal shall lie from a decree  passed by the Court with the consent of the parties".  The award of the Lok  Adalat is an order by the Lok Adalat under the consent of the parties, and it  shall be deemed to be a decree of the Civil Court, therefore an appeal shall  not lie from the award of the Lok Adalat as under Section 96(3) C.P.C.         In Punjab National Bank vs. Lakshmichand Rah reported in AIR  2000 Madhya Pradesh 301, 304, the High Court held that  "The provisions  of the Act shall prevail in the matter of filing an appeal and an appeal would  not lie under the provisions of Section 96 C.P.C. Lok Adalat is conducted  under an independent enactment and once the award is made by Lok Adalat  the right of appeal shall be governed by the provisions of the Legal Services  Authorities Act when it has been specifically barred under Provisions of  Section 21(2), no appeal can be filed against the award under Sec.96 C.P.C."   The Court further stated that "It may incidentally be further seen that even  the Code of Civil Procedure does not provide for an appeal under Section  96(3) against a consent decree.  The Code of Civil Procedure also intends  that once a consent decree is passed by Civil Court finality is attached to it.   Such finality cannot be permitted to be destroyed, particularly under the  Legal Services Authorities Act, as it would amount to defeat the very aim  and object of the Act with which it has been enacted, hence, we hold that the  appeal filed is not maintainable.                 The High Court of Andhra Pradesh held that, in Board of  Trustees of the Port of Visakhapatnam vs. Presiding Officer,  Permanent, Lok Adalat-cum-Secretary, District Legal Services  Authority, Visakhapatnam and another reported in 2000(5) ALT 577, "  The award is enforceable as a decree and it is final.  In all fours, the  endeavour is only to see that the disputes are narrowed down and make the  final settlement so that the parties are not again driven to further litigation or  any dispute.  Though the award of a Lok Adalat is not a result of a contest  on merits just as a regular suit by a Court on a regular suit by a Court on a  regular trial, however, it is as equal and on par with a decree on compromise  and will have the same binding effect and conclusive just as the decree  passed on the compromises cannot be challenged in a regular appeal, the  award of the Lok Adalat being akin to the same, cannot be challenged by  any regular remedies available under law including invoking Article 226 of  the Constitution  of India challenging the correctness of the award on any  ground.  Judicial review cannot be invoked in such awards especially on the  grounds as raised in this writ petition.         The award of Lok Adalat is final and permanent which is  equivalent to a decree executable, and the same is an ending to the litigation  among parties.        In Sailendra Narayan Bhanja Deo vs. The State of Orissa, AIR 1956   SUPREME COURT 346, (CONSTITUTION BENCH) held as follows:      A Judgment by consent or default is as effective an estoppel  between the parties as a judgment whereby the court exercises

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its mind on a contested case.  (1895) 1 Ch.37 & 1929 AC 482,  Rel. on;   In \026 ’In re South American and Mexican Co., Ex. Parte Bank  of England’, (1895) 1 Ch 37 ), it has been held that a judgment  by consent or default is as effective an estoppel between the  parties as a judgment whereby the Court exercises its mind on a  contested case.  Upholding the judgment of Vaughan  Williams,J Lord Herschell said at page 50 :-    "The truth is, a judgment by consent is intended to put a stop  to litigation between the parties just as much as is a judgment  which results from the decision of the Court after the matter has  been fought out to the end.    And I think it would be very mischievous if one were not to  give a fair and reasonable interpretation to such judgments, and  were to allow questions that were really involved in the action  to be fought over again in a subsequent action."  To the like effect are the following observations of the Judicial  Committee in \026 ’Kinch v. Walvott’, 1929 AC 482 at p.493 (D):-   "First of all their Lordships are clear that in relation to this  plea of estoppel it is of no advantage to the appellant that the  order in the libel action which is said to raise it was a consent  order.  For such a purpose an order by consent , not discharged  by mutual agreement, and remaining unreduced , is as effective  as an order of the Court  made otherwise than by consent and  not discharged on appeal."         The same principle has been followed by the High Courts in India in a  number of reported decisions.  Reference need only be made to the cases of  \026 ’ Secy. Of State v. Ateendranath Das’, 63 Cal 550 at p. 558 (E) ; - ’  Bhaishanker v. Moraji’, 36 Bom 283 (F) and \026 ’ Raja Kumara Venkata  Perumal Raja Bahadur’, v. Thatha Ramasamy Chetty’, 35 Mad 75 (G).  In  the Calcutta case after referring to the English decisions the High Court  observed as follows :         "On this authority it becomes absolutely clear that the  consent order is as effective as an order passed on contest, not  only with reference to the conclusion arrived at in the  previous suit but also with regard to every step  in the process  of reasoning on which the said conclusion is founded.         When we say  "every step in the reasoning" we mean  the findings on the essential facts on which the judgment or  the ultimate conclusion was founded.    In other words the  finding which it was necessary to arrive at for the purpose of  sustaining the judgment in the particular case will operate as  estoppel by judgment."

The Civil Procedure Code contains the following provisions: "Order 23 Rule 3 provides for compromise of suit \026 where it is  proved to the satisfaction of the Court that a suit has been  adjusted wholly in part by any lawful agreement or  compromise, written and signed by the parties.  The Court after  satisfying itself about the settlement, it can convert the  settlement into a judgment decree."   

We have already discussed about the steps taken by the appellant to  serve notice on the respondent and the steps taken by him to perform his  obligations and sending of the notice and telegram etc. would not have been    done unless the appellant was ready with his obligations and the money all  along.  The appellant had waited till almost the last day for the respondent to  perform his obligations.  The High Court, in our view, has failed to note that  the courts attempt should be to give life and enforceability to the  compromise award and not to defeat it on technical grounds.  This is a fit  case, in our view, where the Respondent ought to have been directed to  execute the sale deed by the extended time, if necessary.  The High Court is  also not correct in holding that the Court has no jurisdiction to extend the  time.   In our view, the learned Subordinate Judge has rightly extended the  time for depositing the money which the High Court has wrongly interfered

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with.

We, therefore, hold that the order passed by the High Court in C.R.P.  1136/2003 is liable to be set aside.  We do so accordingly.  We direct the  Respondent herein to execute the sale deed within two weeks from today  failing which the Appellant could get the sale deed executed though court as  stipulated in the award.  The respondent is now entitled to withdraw Rs. 9.5  lakhs from the Sub-Court Alapuzha.  Though this is a fit case for awarding  cost, we refrain from doing so in view of the relationship between the  parties.          The appeal is allowed.  No costs.