Lok Adalat has no jurisdiction to decide matter on merits if no compromise between parties: Supreme Court

The apex court said once the settlement or a compromise fails, the Lok Adalat has to return the case to the Court from which the reference has been received for disposal in accordance with the law.

Lok Adalat has no jurisdiction to decide the matter on merits once it is found that compromise or settlement could not be reached between the parties, the Supreme Court said on Thursday.

The apex court said the provisions of the Legal Services Authorities Act, 1987 make 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.

It said that once the settlement or a compromise fails, the Lok Adalat has to return the case to the Court from which the reference has been received for disposal in accordance with the law.

"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 reached between the parties," a bench of Justices M.R. Shah and A.S. Bopanna said.

The judgement was passed on an appeal filed by the Estate Officer challenging the 2013 order passed by the Madhya Pradesh High Court by which in a Lok Adalat, the members of the Lok Adalat has entered into the merits of the writ petition and has dismissed the case on merits.

The apex court said the order passed by the Lok Adalat dismissing the writ petition on merits is unsustainable and deserves to be quashed and set aside.

It rejected the argument that once the matter was placed before the Lok Adalat with consent, it was justified in disposing of the matter on merits. "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,” the bench said.

"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 of the Legal Services Authorities Act, 1987, 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," the bench further added.

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