Mandatory nature of conciliation proceedings under Section 22C of the Legal Services Authorities Act, 1987, and the influence of the decision in Canara Bank Vs. G.S. Jayarama (2022) 7 SCC 776 on the court's decision.

VINOD S. BHARDWAJ, J.

1. Challenge in the present petition is to the Award dated 14.05.2016 (Annexure P-1) passed by respondent No.2- Permanent Lok Adalat (Public Utility Services), Rewari.

2. Briefly summarized, the facts of the present case are that Mr. Devender Yadav, the registered owner of the vehicle No.HR-36L-7765, is stated to have sold the vehicle in favour of one Yadvinder son of Jai Lal and executed a Special Power of Attorney on 12.06.2009. The vehicle in question had been got insured vide Policy No.2013542311012406 for a period of one year from 30.09.2014 to 29.09.2015. The premium for the above policy was undisputedly deposited by the Special Power of Attorney itself. On 20.10.2014, the Special Power of Attorney holder of the owner- Devender Yadav was coming from Kosli to his village, driving the abovesaid vehicle. When he reached near railway crossing, two persons stopped the vehicle for taking lift and eventually they snatched the said vehicle. An FIR was registered qua the said incident on the same date at Police Station Kosli. The vehicle could not be traced out. Thereafter, the claim was lodged through the Special Power of Attorney holder. A surveyor/investigator was appointed by the petitioner-Insurance Company and the ID value of vehicle was assessed at Rs.2,66,195/-. The claim of the owner was, however, repudiated by the petitioner-Insurance Company whereupon an application under 22(C) of the Legal Services Authorities Act, 1987 was instituted before the Permanent Lok Adalat (Public Utility Services), Rewari.

3. A written statement was filed by the petitioner-Insurance Company before the Permanent Lok Adalat (Public Utility Services), Rewari, wherein reliance was placed on the India Motor Tariff promulgated by the Insurance Regulatory Development Authority of India as per which the vehicle in question had been sold by Devender Yadav to Yadvinder Singh on 12.06.2009. Thereafter, neither the Registration Certificate nor the Insurance of the vehicle was transferred in the name of Yadvinder Singh i.e. the Special Power of Attorney holder. The applicant-Yadvinder Singh thus did not have any insurable interest in the vehicle as on the date of theft i.e. 20.10.2014 and the claim could not be entertained at his behest.

4. Learned counsel for the petitioner contends that even though the mandate of The Legal Services Authorities Act, 1987 is that conciliation efforts have to be made in terms of Section 22-C(4) to (7) of the said Act before adjudicatory process under Section 22-C(8) of the said Act can be initiated, however, no such attempt was made by the Permanent Lok Adalat (Public Utility Services), Rewari. The mandate of conciliation being a mandatory perquisite for adjudication of the lis, any failure to make efforts for conciliation would vitiate the subsequent Award passed. It is averred that the above aspect has been settled by the Hon'ble Supreme Court in the matter of Canara Bank Vs. G.S. Jayarama reported as (2022) 7 SCC 776. The relevant extract of the same reads thus:

"23. We must now address the first issue, i.e., whether the conciliation proceedings before the Permanent Lok Adalats are mandatory before it can decide a dispute on its merits.

24. This issue is clearly resolved from a bare reading of Section 22C. Section 22C provides a step-by-step scheme on how a matter is to proceed before the Permanent Lok Adalat. The first step is the filing of the application which ousts the jurisdiction of other civil courts, in accordance with sub-Sections (1) and (2). The second step is the parties filing requisite submissions and documents before the Permanent Lok Adalat, in accordance with sub-Section (3). On the completion of the third step to its satisfaction, the Permanent Lok Adalat can move to the fourth step of attempting conciliation between the parties, in accordance with sub-Sections (4), (5) and (6). Subsequently, in the fifth step in accordance with sub-Section (7), the Permanent Lok Adalat has to draw up