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2023 Supreme(AP) 688

IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
CHEEKATI MANAVENDRANATH ROY, TARLADA RAJASEKHAR RAO, JJ.
Boreddy Venkata Narayana Reddy - Petitioner
Versus
Mandal Legal Service Committee and Others - Respondents
Writ Petition No.17682 Of 2012
Decided On : 13-07-2023

Advocates Appeared:
For the Petitioner: T. C. Krishnan.
For the Respondents: Karri Murali Krishna

The central legal point established in the judgment is the requirement of issuing notices to all parties before referring a matter to Lok Adalat for settlement and the need for the Lok Adalat to follow principles of natural justice, equity, and fair play.

Headnote:

Fraud - Legal Validity of Lok Adalat Award - A.P. Legal Services Authority Act, 1987, Section 19(5), Section 20, Regulation 31 - The court discussed the relevant provisions of the A.P. Legal Services Authority Act, 1987, and the Regulations framed thereunder. It emphasized the requirement of issuing notices to all parties before referring a matter to Lok Adalat for settlement and the need for the Lok Adalat to follow principles of natural justice, equity, and fair play. The court found that the impugned award was passed without following the prescribed procedure, and hence, set it aside.

Fact of the Case:

The Writ Petition challenged the legal validity of an award passed by the Lok Adalat Bench in a suit for partition of family properties. The plaintiff and some defendants colluded to refer the matter to Lok Adalat without giving notice to other defendants, and the Lok Adalat passed an award without issuing notices to all parties.

Finding of the Court:

The court found that the impugned award was passed without following the prescribed procedure, violating the principles of natural justice and fairness. It held that the award was legally unsustainable and set it aside, remanding the matter to the Lok Adalat with a direction to issue notices to all parties and pass the award accordingly.

Issues: The issues revolved around the legal validity of the award passed by the Lok Adalat without issuing notices to all parties, particularly in a suit for partition, and whether the award complied with the principles of natural justice and fairness.

Ratio Decidendi: The court emphasized the requirement of issuing notices to all parties before referring a matter to Lok Adalat for settlement, as prescribed under the A.P. Legal Services Authority Act, 1987, and the need for the Lok Adalat to follow principles of natural justice, equity, and fair play. It held that even if a person was set ex parte, they are still considered a party to the suit for all practical purposes and are entitled to notice.

Final Decision: The Writ Petition was allowed, and the impugned award was set aside. The matter was remanded to the Lok Adalat with a direction to issue notices to all parties and pass the award accordingly. No costs were awarded.

ORDER:

(Cheekati Manavendranath Roy, J.)

1. This Writ Petition is filed challenging the legal validity of the award dated 17.03.2012 passed by the Lok Adalat Bench and to set aside the same.

2. The facts of the case show that the case on hand is yet another classic example of playing fraud in the Lok Adalats in obtaining awards, particularly, in suits filed for partition of the family properties.

3. Relevant facts necessary to dispose of the Writ Petition may briefly be stated as follows:

The plaintiff has filed the suit against 5 defendants for partition of the plaint schedule properties therein. The plaintiff and the defendants 1 to 4 in the suit are the siblings, whereas the 5th defendant is purchaser of some of the properties relating to the family. In the said suit, defendants 1 and 3 to 5 were set ex parte. Only 2nd defendant originally contested the suit. After defendants 1 and 3 to 5 were set ex parte, 2nd defendant who contested the suit did not oppose the claim of the plaintiff who claimed 1/5th share in the plaint schedule properties. Thereafter, on a joint memo filed by the plaintiff and 2nd defendant, the trial Court referred the matter to Lok Adalat for settlement. The trial Court did not order notices to defendants 1 and 3 to 5 before referring the matter to Lok Adalat. Even the Lok Adalat also did not issue notices to defendants 1 and 3 to 5 before settling the matter and passing the impugned award. In the settlement arrived at before the Lok Adalat, as per the impugned award, 1/5th share in the plaint schedule was allotted to the plaintiff. But the award is silent as to the share allotted to defendants 1 and 3 to 5. Therefore, the 3rd defendant in the said suit filed the present Writ Petition questioning the legal validity of the impugned award.

4. Heard the learned counsel for the petitioner, Sri S.Lakshmi Narayana Reddy, learned Standing Counsel for respondent No.1-Legal Service Committee and the learned counsel for the respondents 2 and 4, who are the plaintiffs and D2 in the said suit. None appeared for respondents 3 and 4 to 8.

5. The present case is clearly covered by the earlier judgment of the Division Bench of this Court rendered in the case of B.Srinatha Reddy v. District Legal Service Authority, Kadapa and others, 2019 (6) ALD 443 (D.B.). At paragraph Nos.36 to 40, the Division Bench of this Court held as follows:

36. So, the paramount question to be considered is whether the award passed by the Lok Adalat without issuing notice to the 2nd defendant is valid under law and whether it is legally sustainable or not. In order to test the validity of the said award on the said ground, it is appropriate to consider the relevant provisions in the Legal Services Authority Act, 1987 and the Regulations framed thereunder. As per Section 19(5) of the 1987 Act, 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 the Court 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. In the instant case clause (i) applies as it is a matter pending before the Court. The words used in the above Section 19(5) "parties to dispute" are significant to note which means all the parties to the dispute. So, the Lok Adalat has to make an endeavour to arrive at a compromise or settlement between all the parties to the dispute. Section 20 of the 1987 Act deals with cognizance of cases by Lok Adalats. It postulates that where any case is referred to as per clause (i) of subsection (5) of Section 19, if the parties thereof agree or if one of the parties thereof makes an application to the Court for referring the case to the Lok Adalat for settlement and if the Court is prima facie satisfied that the matter is an appropriate one to be taken cognizance by the Lok Adalat, the Court shall refer the case to the Lok Adalat. Now, it is relevant

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