JUDGMENT
M.Y. Eqbal, J.
1. In this writ petition, petitioner has challenged the order dated 4.1.2005 passed by the Permanent Lok Adalat, Ranchi in PLA Case No. 30 of 2004 whereby the preliminary issue with regard to the jurisdiction of the Lok Adalat raised by the petitioner has been decided in favour of the claimant- respondent.
2. Respondent No. 2 obtained a Burglary and House Breaking Policy from the petitioner-Insurance Company. As alleged, on 18/19.8.2002 a burglary took place and respondent No. 2 submitted claim with the Insurance Company for a loss of Rs. 11,14,577/-. For the said occurrence F.I.R. was also lodged. Subsequently, the claim of respondent No. 2 was repudiated by the Insurance Company. In the meantime, respondent No. 2 filed Complaint Case No. 255 of 2004 before the District Consumer Forum, Ranchi which was dismissed by the Consumer Forum by order dated 31.8.2004 holding that deficiency in service relating to a commercial activity is not to be considered by Consumer Forum as such service has been excluded from the purview of the Act. Accordingly, the complaint is not at all maintainable in this Forum. Respondent No. 2 then filed this Claim before Permanent Lok Adalat, Ranchi by reducing the claim amount to Rs. 9,80,000/-. On being noticed, the petitioner-Insurance Company appeared and filed objection stating, inter alia, that the claim before the Permanent Lok Adalat is not maintainable. It is stated that the criminal case instituted on the basis of F.I.R. is still pending and the same is at the investigation stage. Petitioner also denied and disputed the claim of the respondents and asserted that the Permanent Lok Adalat has no jurisdiction to entertain the claim of the respondents.
3. Permanent Lok Adalat after entertaining the claim application for pre-litigation conciliation and settlement under the provisions of Section 22-C of the Legal Services Authorities Act, 1987 proceeded to decide the preliminary issue with regard to its jurisdiction and held that it has jurisdiction to entertain the application and further held that application is maintainable before the Permanent Lok Adalat. Hence, this writ petition.
4. Mr. V. Shivnath, learned counsel appearing for the petitioner assailed the impugned order as being contrary to provisions of Legal Services Authorities Act, 1987 (in short the Act). Learned counsel submitted that a criminal case under Section 379, IPC was registered and since the offence under Section 379, IPC is not a compoundable offence, the Permanent Lok Adalat (in short PLA) has no jurisdiction to entertain the claim of the respondents. Learned counsel drawn my attention to relevant provisions of the said Act and submitted that the impugned order cannot be sustained in law.
5. Before appreciating the submissions made by the learned counsel, I would like to refer some of the provisions of the said Act.
6. The Legal Services Authorities Act, 1987 has been enacted to constitute Legal Services Authorities to provide free and competent legal services to the weaker sections of the society and to ensure that opportunities for securing justice are not denied to any citizen by reason of economic or other disabilities and to organize Lok Adalats to secure that the operation of the legal system promotes justice on the basis of equal opportunity. By the said Act, the Authority/Committee has been vested with the power to organize Lok Adalats in every District, Taluk/Block and Sub-division. Section 19 of the said Act reads as under :
“19. Organisation of Lok Adalats.–(1) Every State Authority or District Authority or the Supreme Court Legal Services Committee or every High Court Legal Services Committee or, as the case may be, Taluk Legal Services Committee may organize Lok Adalats at such intervals and places and for exercising such jurisdiction and for such areas as it thinks fit.
(2) Every Lok Adalat organized for an area shall consist of such number of:–
(a) serving or retired judicial officers; and
(b) other person, of the area as may be specified by the State Authority or the District Authority or the Supreme Court Legal Services Committee or the High Court Legal Services Committee, or as the case may be, the Taluk Legal Services Committee, organizing such Lok Adalat.
(3) The experience and qualifications of other persons referred to in Clause (b) of Sub-section (2) for Lok Adalats organized by the Supreme Court Legal Services Committee shall be such as may be prescribed by the Central Government in consultation with the Chief Justice of India.
(4) The experience and qualifications of other persons referred to in Clause (b) of Sub-section (2) for Lok Adalats other than referred to in Sub-section (3) shall be such as may be prescribed by the State Government in consultation with the Chief Justice of the High Court.
(5) A Lok Adalat shall have jurisdiction to determine and to arrive at a compromise or settlement between the parties to a dispute in respect of,–
(i) any case pending before; or
(ii) any matter which is falling within the jurisdiction of, and is not brought before, any Court for which the Lok Adalat is organized :
Provided that the Lok Adalat shall have no jurisdiction in respect of any case or matter relating to an offence not compoundable under any law.”
7. Chapter VI-A has been inserted in the said Act by virtue of Legal Services Authorities (Amendment) Act, 2002 which provides, inter alia, for constitution of Permanent Lok Adalat for the purpose of pre-litigation, conciliation and settlement. By the said amended Sections 22-A, 22-B, 22-C, 22-D and 22-E has been inserted. It would be useful to quote Section 22-A to Section 22-E of the said Act here-in-under :
“22-A. Definitions.–In this chapter and for the purposes of Sections 22 and 23, unless the context otherwise requires,–
(a) “Permanent Lok Adalat” means a Permanent Lok Adalat established under Sub-section (1) of Section 22-B;
(b) “public utility service” means any,–
(i) transport service for the carriage of passengers or goods by air, road or water; or
(ii) postal, telegraph or telephone service; or
(iii) supply of power, light or water to the public by any establishment; or
(iv) system of public conservancy or sanitation; or
(v) service in hospital or dispensary; or
(vi) insurance service,
and includes any service which the Central Government or the State Government, as the case may be, may, in the public interest, by notifications, declare to be a public utility service for the purposes of this Chapter.
22-B. Establishment of Permanent Lok Adalats.–(1) Notwithstanding anything contained in Section 19, the Central Authority or, as the case may be, every State Authority shall, by notification, establish Permanent Lok Adalats at such places and for exercising such jurisdiction in respect of one or more public utility services and for such areas as may be specified in the notification.
(2) Every Permanent Lok Adalat established for an area notified under Sub-section (1) shall consist of,–
(a) a person who is, or has been, a District Judge or Additional District Judge or has held judicial office higher in rank than that of a District Judge, shall be the Chairman of the Permanent Lok Adalat; and
(b) two other persons having adequate experience in public utility service to be nominated by the Central Government or, as the case may be, the State Government on the recommendation of the Central Authority or, as the case may be, the State Authority,
appointed by the Central Authority or, as the case may be, the State Authority, establishing such Permanent Lok Adalat and the other terms and conditions of the appointment of the Chairman and other persons referred to in Clause (b) shall be such as may be prescribed by the Central Government.
22-C. Cognizance of cases by Permanent Lok Adalat.–(1) Any party to a dispute may, before the dispute is brought before any Court, make an application to the Permanent Lok Adalat for the settlement of dispute :
Provided that the Permanent Lok Adalat shall not have jurisdiction in respect of any matter relating to an offence not compoundable under any law :
Provided further that the Permanent Lok Adalat shall also not have jurisdiction in the matter where the value of the property in dispute exceeds ten lakh rupees :
Provided also that the Central Government, may, by notification, increase the limit of ten lakh rupees specified in the second proviso in consultation with the Central Authority.
(2) After an application is made under Sub-section (1) to the Permanent
Lok Adalat, no party to that application shall invoke jurisdiction of any Court in the same dispute.
(3) Where an application is made to a Permanent Lok Adalat under Sub-section (1), it,–
(a) shall direct each party to the application to file before it a written statement, stating therein the facts and nature of dispute under the application, points or issues in such dispute and grounds relied in support of, or in opposition to, such points or issues, as the case may be, and such party may supplement such statement with any document and other evidence which such party deems appropriate in proof of such facts and grounds and shall send a copy of such statement together with a copy of such document and other evidence, if any, to each of the parties to the application;
(b) may require any party to the application to file additional statement before it at any stage of the conciliation proceedings;
(c) shall communicate any document or statement received by it from any party to the application to the other party, to enable such other party to present reply thereto.
(4) When statement, additional statement and reply, if any, have been filed under Sub-section (3), to the satisfaction of the Permanent Lok Adalat, it shall conduct conciliation proceedings between the parties to the application in such manner as it thinks appropriate taking into account the circumstances of the dispute.
(5) The Permanent Lok Adalat shall, during conduct of conciliation proceedings under Sub-section (4), assist the parties in their attempt to reach an amicable settlement of the dispute in an independent and impartial manner.
(6) It shall be the duty of every party to the application to cooperate in good faith with the Permanent Lok Adalat in conciliation of the dispute relating to the application and to comply with the direction of the Permanent Lok Adalat to produce evidence and other related documents before it.
(7) When a Permanent Lok Adalat, in the aforesaid conciliation proceedings, is of opinion that there exist elements of settlement in such proceedings which may be acceptable to the parties, it may formulate the terms of a possible settlement of the dispute and give to the parties concerned for their observations and in case the parties reach at an agreement on the settlement of the dispute, they shall sign the settlement agreement and the Permanent Lok Adalat shall pass an award in terms thereof and furnish a copy of the same to each of the parties concerned.
(8) Where the parties fail to reach at an agreement under Sub-section (7), the Permanent Lok Adalat shall, if the dispute does not relate to any offence, decide the dispute.
22-D. Procedure of Permanent Lok Adalat.–The Permanent Lok Adalat shall, while conducting conciliation proceedings or deciding a dispute on merit under this Act, be guided by the principles of natural justice, objectivity, fair play, equity and other principles of justice, and shall not be bound by the Code of Civil Procedure, 1908 (5 of 1908) and the Indian Evidence Act, 1872 (1 of 1872).
22-E. Award of Permanent Lok Adalat to be final.–(1) Every award of the Permanent Lok Adalat under this Act made either on merit or in terms of a settlement agreement shall be final and binding on all the parties thereto and on persons claiming under them.
(2) Every award of the Permanent Lok Adalat under this Act shall be deemed to be a decree of a Civil Court.
(3) The award made by the Permanent Lok Adalat under this Act shall be by a majority of the persons constituting the Permanent Lok Adalat.
(4) Every award made by the Permanent Lok Adalat under this Act shall be final and shall not be called in question in any original suit, application or execution proceeding.
(5) The Permanent Lok Adalat may transmit any award made by it to a Civil Court having local jurisdiction and such Civil Court shall execute the order as if it were a decree made by the Court.”
8. From a bare reading of Section 22(C) of the Act, it is manifest that any party to a dispute may before going to a Court of Law or other Forum, approach the Permanent Lok Adalat for the settlement of dispute. Proviso to this section very clearly provides that the Permanent Lok Adalat shall have no jurisdiction in respect of any matter relating to an offence not compoundable under any law. It further provides that the Permanent Lok Adalat shall also not have jurisdiction in the matter where the value of the property in dispute exceeds ten lacs of rupees. Admittedly, in the instant case a burglary took place in the godown of the respondents and an FIR to that effect was lodged in the Police Station and a criminal case was registered as Doranda PS Case No. 216 of 2002. After investigation by the police, initially a final form was submitted but on the protest petition filed by the petitioner raising serious grievances regarding submission of Final Form, the matter was heard at length by the Chief Judicial Magistrate who by order dated 6.10.2004 held that further investigation is required and the order was sent to the City S.P., Ranchi for making further investigation of the case and the criminal case is now at the investigation stage. Admittedly the offence of committing burglary and house breaking is not a compoundable offence. Inspite of that the Permanent Lok Adalat in the impugned order held as under :
5. So far point No. 2 and 3 are concerned, it has been submitted by the O.P. that this P.L.A. has jurisdiction to entertain a dispute if any dispute is not brought before any Court as provided under Section 22 of Legal Services Authority Act, 1987. It has been submitted that re-investigation is going on and a criminal case is pending regarding alleged burglary before the Court of learned C.J.M. But his argument does not appear sound to us on the ground that in the Court of C.J.M. The police has submitted final form showing occurrence true but no clue was found. Later on after present claim application the O.P. filed petition before learned C.J.M. who was pleased to order re-investigation. However, the finding of criminal Court is not binding on this Court and this Court has to decided as to whether burglary had taken place or not. After taking independent evidence of the parties. So far finding of Surveyor is concerned it is regarding merit of the claim which this P.L.A. has to decide after taking evidence. If the claim cannot be refused on this basis of surveyor report at this stage.
In view of the above discussion we are of the opinion that this Permanent Lok Adalat has jurisdiction to entertain this claim application of the claimant. Secondly we decide the issue of pecuniary jurisdiction in favour of the applicant claimant holding that the present application is maintainable in this Permanent Lok Adalat.
9. In my considered opinion, the Permanent Lok Adalat has committed great error of law in holding that it has jurisdiction inspite of the fact that the matter relates to an offence not compoundable under any law. The Permanent Lok Adalat has further committed serious error of law in holding that the finding of the criminal Court in non-compoundable offence is not binding on it.
10. No doubt, Chapter VI(A) has been inserted in the Legal Services Authority Act, 1987 by Amendment Act of 2002 for constitution of Permanent Lok Adalat for the purpose of pre-litigation conciliation and settlement, but the whole object of the Act is to provide free legal and competent legal services to the weaker section of the Society to ensure that opportunities for security justice are not denied to any citizen by reason of economic or other disability. The amended provision of the Act does not confer power to the Permanent Lok Adalat even to entertain the disputes which is related to a criminal offence not compoundable in law.
11. After giving my anxious consideration to the facts of the Case and the law discussed herein above, I am of the opinion that the impugned order passed by the Permanent Lok Adalat is bad in law and, is liable to be set-aside. This writ application is, therefore, allowed and the impugned order passed by the Permanent Lok Adalat is set-aside and it is held that the Permanent Lok Adalat has no jurisdiction to insist the parties for the settlement of disputes or to proceed to decide the disputes on merit.