ORDER
K. Gnanaprakasam, J. (Chairperson)
1. Appeals MA-S4/2006 and MA-55/2006 have been preferred against the common order dated 12.12.2005, passed by the DRT-I, Chcnnai, in MAs 268 and 201/2005 in OA-538/2000. MA-268/2005 was filed praying the DRT to set aside the order dated 13.10.2004 and recall the issuance of recovery certificate issued in the OA. MA-201/2005 was filed before the DRT to modify the order dated 22.11.2003 by extending the time for payment of the balance settlement amount.
2. The appellant Bank and respondents have settled their claim before the Lok Adalat and an award was passed by the Lok Adalat on 22.11.2003, permitting the respondents to effect payments within the time given and the same was not complied with by the respondents. The Bank had applied for the issuance of the recovery certificate and the respondents filed an application to defer the issuance of the recovery certificate and the same was dismissed for default by DRT’s order dated 13.10.2004. The respondents filed an application for extension of time for the payment of the amount due as per the award of the Lok Adalat dated 22.11.2003, and DRT by its order dated 12.12.2005 granted four weeks time for payment of the balance amount, and the same is under challenge in these appeals.
I have heard the learned Advocate for the appellant and the respondents and also perused the appeal records.
3.The fact that the appellant and the respondents have settled the claim before the Lok Adalat, which culminated in passing of an award on 22.11.2003, is not in dispute. The terms of the award run as follows:
The total claim by the Bank - Rs. 524.73 lakh The amount of settlement - Rs. 150.00 lakh The defendant has already paid a sum of Rs. 37.5 lakh on 4.8.2003. The defendant is today paying a sum of Rs. 3 lakh by cheque bearing No. 254915 dated 21.11.2003. The defendant agrees to pay the remaining Rs. 109.50 lakh by 20.3.2004 with PLR interest from 1.8.2003. In case of any default by the defendant, the Bank is at liberty to claim as per their claim in the OA. Court fee is ordered to be refunded under Section 21(1) of the L.S.A. Act.
4. As per this award, the defendant agreed to pay the remaining Rs. 109.50 lakh by 20.3.2004 with PLR rate of interest from 1.8.2003. The award further reads that in case of any default by the defendant, the Bank is at liberty to claim as per their claim in the OA. It is the contention of the appellant, as the respondents have not paid the amount within the given time, the Bank is entitled to claim the entire amount as claimed in the OA. It is further contended that the DRT has no power to extend the time, which was agreed to by the parties and in pursuance of the same, the award was also passed by the Lok Adalat.
5. Now the question that arises for determination in this appeal is, “Whether the DRT has got right to extend the time, which was agreed to by the parties before the Lok Adalat?
6. On behalf of the appellant, it is contended that the award passed by the Lok Adalat is final and the Courts have no right to extend the time agreed before the Lok Adalat. As the respondents have committed default, in not having paid the amount within the stipulated time, the appellant Bank is entitled to invoke the default clause and recover the entire amount as claimed in the OA. In support of his contention, appellant places reliance upon an unreported judgment of the Supreme Court in Civil Appeal No. 1075/2006, Indian Bank v. K.V. Lakshimpathy and Anr. In that case, there was a settlement recorded before the Lok Adalat, but however, the defendants were not able to pay the amount in accordance with the settlement and prayed for extension of time before the DRT to make the deposit and those deposits were made belatedly. There also, the appellant Bank claimed that it is entitled to recover the full amount due by the borrowers and not the reduced amount as settled before the Lok Adalat. While dealing with the said matter, the Hon’ble Supreme Court has observed, “In sum and substance the Bank contends that it is entitled to recover the full amount of Rs. 19 crores. We express no opinion on the submissions urged before us by the learned Counsel appearing for the Bank because LA. No. 636 is pending before the DRT-I, Chennai.” (Now the appellant states that the LA. No. is wrongly typed. In order to have a clarification, this Tribunal felt that the records relating to O.A. 76/1998 of DRT-I, Chennai, is required and the same is required and the same is sent for and perused). The Supreme Court further observed that, “We have gone through the impugned order dated 2.9.2005. We wish to make no observation with regard to the correctness or otherwise of the observations made by the High Court in the impugned order but we direct that the DRT-I, Chennai, will consider LA. No. 636/2004 uninfluenced by observations made by the High Court in its order dated 2.9.200.5 since the same have been made only for the purpose of disposal of the matter before the High Court.” It is the contention of the learned Advocate for the appellant, that the Supreme Court has not set aside nor remanded the matter for fresh disposal and, therefore, the Courts much less the DRT, has no power to grant extension of time, which was granted by the Lok Adalat. It is, therefore, argued that the appellant Bank is entitled to recover the entire amount due in the OA.
7. Per contra, Mr. P.L. Narayanan, learned Senior Advocate appearing for the respondents would submit that the Courts including the Tribunal such as DRT and DRAT have got power to extend the time, which was granted by the Lok Adalat. Incidentally, it is pointed out that even before the Lok Adalat, the appellant Bank had agreed of the extension of time for payment of the amount upto 20.3.2004, even though it claimed interest from 1.8.2003. When the Bank itself was prepared for extension of time on the date when the award was passed, the time agreed before the Lok Adalat and granted in the Lok Adalat could very well be extended by the Court as well as by the Tribunal.
In support of his submission, the respondents relied upon the case of P.T. Thomas v. Thomas Job III (2005) CLT 254 (SC) : 2005(4) CTC 30, wherein a similar case came for consideration before the Supreme Court and it dealt with the matter elaborately and had opined, “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 (emphasis supplied). In out 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.” The Supreme Court also considered the decision rendered by the High Court of Andhra Pradesh in Board of Trustees of the Port of Visakhapatnam v. Presiding Officer, Permanent, Lok Adalat-cum-Secretary, District Legal Services Authority, Visakhapatnam and Anr. 2000 (5) ALT 577, to arrive at such a conclusion wherein it was held that, “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 of 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 trial, however, it is as equal and at par with a decree on compromise and will have the same binding effect and conclusive just as the decree passed on a compromise 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 the writ petition.” Ultimately, the Hon’ble Supreme Court has held, “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 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 with”, thereby meaning that the Courts have got every power to extend the time which was agreed/granted in the Lok Adalat. But at the same time, it is made clear that the award passed in the Lok Adalat cannot be challenged in a regular appeal as the award passed before the Lok Adalat is an award passed by consent and it is a well settled law that no appeal would lie as against the decree passed on consent. There is absolutely no quarrel as far as this principle is concerned that the award passed by the Lok Adalat is valid and binding upon the parties.
8. But now the case before us is whether the DRT is correct in having extended the time to perform the obligations/payment, which was directed to be paid by the respondents to the appellant Bank.
9. True it is that as per the award passed by the Lok Adalat, the respondents should pay the remaining amount of Rs. 109.50 lakh by 20.3.2004 with PLR interest from 1.8.2003. It is also true that there is a default incorporated in the award, which reads that, “In case of any default by the defendant, the Bank is at liberty to claim as per their claim in the OA.” In the given situation, whether the DRT has got power to extend the time is a question to be resolved.
10.It is contention of the learned Advocate for the respondents that the Courts are not helpless and hapless in overcoming any stringent or onerous clause incorporated in any agreement or contract. In support of his submission, the respondents relied upon the case of Smt. Periyakkal and Ors. v. Smt. Dakshayani, (supra), wherein it was observed, “4. In the case before us, the situation is totally different. Unlike the case of Hukumchand v. Bansilal AIR 1968 SC 86, where there was a statutory compulsion to confirm the sale on the dismissal of the application under Order 21 Rule 90 and, therefore, postponement and further postponement of the confirmation of the sale could only be by the consent of the parties, in the case before us, there was no statutory compulsion to dismiss the application under Order 21 Rule 90 in the absence of an agreement between the parties. The time for deposit stipulated by the parties becomes the time allowed by the Court and this gave the Court the jurisdiction to extend time in appropriate case. Of course, time would not be extended ordinarily, nor for the mere asking. It would be granted in rare cases to prevent manifest injustice.” The time agreed and granted before the Lok Adalat is not under any statute. The time prescribed under any statute alone, could not be extended even by consent of parties. When no time is prescribed under the statute, Court has got jurisdiction to extend the time in appropriate cases. In our case also, the time was agreed only before the Lok Adalat and no under any statute as it has been observed by the Supreme Court. As such, it cannot be said that the Tribunal has no power to extend the time in appropriate cases. The Tribunal had narrated the facts relating to the arriving of the compromise and has stated that compromise was arrived at and bonafide efforts were taken by both the parties and the labour done by the Lok Adalat cannot be neutralised and undone merely on a single lapse on the part of the defendant as they could not be able to pay the balance amount within the given period. It was further stated that when the Bank can grant grace period of six months, why this Court should not reconsider the issue to regularise the payment and to ensure the ends of justice. In fact, the DRT derived its support to say so from the judgment rendered by the Supreme Court in the case of Smt. Periyakkal v. Smt. Dakshayani .
11. The respondents further submitted that the reliance placed by the appellant of the unreported judgment in Civil Appeal No. 1075/2005, wherein only certain directions have been given and such directions are not ipso facto binding upon the Courts and the Courts have to find from the decision, whether any law has been declared or laid or it is distinguishable. In support of this submission, the respondents relied upon the case of Delhi Administration Now NCT of Delhi v. Manoharlal , wherein it was observed, “5. The High Court and all other Courts in the country were no doubt ordinary to follow and apply the law declared by this Court but that does not absolve them of the obligation and responsibility to find out the ratio of the decision and ascertain the law, if any, so declared from a careful reading of the decision concerned and only thereafter proceed to apply it appropriately to the cases before taken….” Certain directions given by the Supreme Court to dispose of that particular matter in the special circumstances noticed by it and the need felt in those cases by the Supreme Court to give such disposal cannot be adopted as a general formula to dispose of the cases, as a matter of routine, and those directions were given in a particular circumstance in respect of a particular case and it is, therefore, the duty of the Courts to apply it appropriately if the ratio is available and not otherwise.
12.The above said view is strengthened in D. Maheswara Raju and Ors. v. The Commissioner, Corporation of Chennai, Rippon Buildings, Chennai-600003 2005- 1-L. W.52, wherein it was held, “That a mere direction by the Supreme Court without laying down any principle of law is not a precedent.” In fact, the High Court had the benefit of the judgment rendered by the Supreme Court in Delhi Judicial Services Association v. Delhi High Court and opined, “The directions given in the said case do not amount to a precedent, as it does not lay down any principle of law”. It is, therefore, made clear that any directions given by the Supreme Court without laying down any principle of law is not a precedent. Thereby assailed the unreported judgment relied upon by the appellant in Civil Appeal No. 1075/2006.
13. As it has already been observed that the parties went before the Lok Adalat and there was an award by the Lok Adalat on 22.11.2003. By the said award, the respondent has to make payments on or before 20.3.2004 but, however, they have agreed to pay interest at PLR rate from 1.8.2003. As it has been rightly pointed out that just because the respondents have committed a default in payment of amount as in the Lok Adalat award, the respondents should not be fastened with the penalty of paying the entire amount as it has been agreed to in the Lok Adalat. I see some force in the said argument advanced on behalf of the respondents as the same is also the law laid down by the Supreme Court in the case of P.T. Thomas v. Thomas Job, (supra).
14. For the foregoing reasons, I am also of the view that this is an appropriate case, where the time granted by the Lok Adalat could be extended, as the respondents would be able to pay the amount only after the sale of the plots. That means they would be able to pay the amount only in piecemeal, not at one stroke. That is why even at the time of passing of the award by the Lok Adalat time was granted upto 20.3.2004, though the award was passed on 22.11.2003. Taking into consideration all the aspects of the case and also by relying upon the decision rendered by the Hon’ble Supreme Court in P.T. Thomas case, I am of the view that the Courts have got every power to extend the time which was agreed/granted in the Lok Adalat in appropriate cases. As such, the DRT has not committed any error in extending the time for the payment, and hence, I do not find any good or valid reasons to interfere with the order passed by the DRT.
15. In the result, the appeals are dismissed.
16. Now it is brought to the notice of the Tribunal that the respondents had already deposited the entire amount due and payable as per the orders passed by the DRT, and the said amount is in the No Lien Account of the Bank. The Bank is at liberty to appropriate the amount towards the amount due from the respondents.
17. Office is directed to send back the records in OA-76/1998 to the DRT-I, Chennai, immediately.