REPORTABLE
IN THE SUPREME COURT OF INDIA
ORIGINAL JURISDICTION
WRIT PETITION (CIVIL) NO. 666 OF 2002
Bar Council of India …… Petitioner
Vs.
Union of India …… Respondent
JUDGMENT
R.M. LODHA, J.
Bar Council of India by means of this writ petition under
Article 32 of the Constitution of India has raised challenge to the vires
of Sections 22-A, 22-B, 22-C, 22-D and 22-E of the Legal Services
Authorities Act, 1987 (for short, ‘1987 Act’) as inserted by the Legal
Services Authorities (Amendment) Act, 2002 (for short, ‘2002 Amendment
Act’).
2. By 2002 Amendment Act, in Section 22 of the 1987 Act, the words
“Lok Adalat” were substituted by “Lok Adalat or Permanent Lok Adalat” and
a new Chapter VI-A entitled “Pre-litigation Conciliation and Settlement”
comprising of Sections 22-A to 22-E came to be inserted. In Section 23 of
the 1987 Act, the words “members of the Lok Adalats” were substituted by
the words “members of the Lok Adalats or the persons constituting Permanent
Lok Adalats”.
3. The challenge is principally on the ground that Sections 22-A,
22-B, 22-C, 22-D and 22-E are arbitrary per se; violative of Article 14 of
the Constitution of India and are contrary to the rule of law as they deny
fair, unbiased and even-handed justice to all.
4. We have heard Mr. Manoj Goel, learned counsel for the
petitioner and Mr. T. S. Doabia, learned senior counsel for the Union of
India. After oral arguments were over, Mr. Manoj Goel, learned counsel for
the petitioner has also filed written submissions. Elaborating the vice of
arbitrariness in the impugned provisions, in the written submissions, it is
submitted that Section 22-C(1) read with Section 22-C(2) provides that a
dispute before Permanent Lok Adalat can be raised by moving an application
to it unilaterally by any party to the dispute (before the dispute is
brought before any court for settlement). The public utility service
provider, thus, can play mischief by pre-empting an aggrieved consumer
from going to the consumer fora or availing other judicial
process
for redressal of his grievance and enforcement of his rights. Permanent
Lok Adalats have been empowered to decide dispute on merits upon failure
between the parties to arrive at a settlement under Section 22-C(8). While
deciding the case on merits, the Permanent Lok Adalat is not required to
follow the provisions of the Civil Procedure Code or the Evidence Act.
Section 22-C(8) prevents the courts and the consumer fora to examine the
deficiencies in services such as transport, postal and telegraph, supply of
power, light or water, public conservancy or sanitation, service in
hospital, etc. and renders the provisions under challenge arbitrary and
irrational.
5. It has been submitted on behalf of the petitioner that award
of the Permanent Lok Adalat on merits is made final and binding and cannot
be called in question in any forum or court of law under Section 22-E(1)
and (4). No right to appeal has been provided for against the award in any
court of law. Since all the public utility services basically relate to the
fundamental right to life provided under Article 21 of the Constitution,
any adverse decision on merits by Permanent Lok Adalat would immediately
impinge upon fundamental right of an aggrieved citizen and, therefore, even
absence of one right of appeal makes these provisions unconstitutional as
it is against the fundamental principles of fair procedure. To say that an
aggrieved person can approach the High Court under Articles 226/227 of the
Constitution against awards given by the Permanent Lok Adalats on merits
and, therefore, absence of right of appeal does not matter, is completely
misplaced. The writ jurisdiction under Articles 226/227 is extremely
limited and is no substitute of the appellate jurisdiction.
6. An argument was raised that though Permanent Lok Adalat
supplants the civil court, consumer court or motor accident claims tribunal
yet its mechanism and delivery of justice are not as effective as the above
fora as the Permanent Lok Adalat is not required to follow the procedure
contemplated in the Code of Civil Procedure and the Evidence Act. Moreover
an award given on merits by Permanent Lok Adalat has to be by majority and
since Permanent Lok Adalat consists of one judicial member and two
administrative members, there is preponderance of administrative members
which is against fundamental principles of justice enshrined in the
Constitution.
7. It was strenuously submitted on behalf of the petitioner that
the jurisdiction conferred upon Permanent Lok Adalat can not oust the
jurisdiction of the fora created under specialized statutes dealing with
the services referred to in Section 22-A(b). In this regard, the provisions
contained in three specialized statutes, namely, the Consumer Protection
Act, 1986, The Telecom Regulatory Authority of India Act, 1997 and the
Insurance Act, 1938 were referred. By relying upon a decision of this
Court in The Premier Automobiles Ltd. v. Kamlekar Shantaram Wadke of Bombay
and Others[1], in the written arguments it has been submitted that the
consumer fora as well as specialized courts/tribunals under the Telecom
Regulatory Authority of India Act, 1997 and the Insurance Act, 1938 have
exclusive jurisdiction as far as enforcement of rights under these statutes
are concerned and their jurisdiction can not be taken away by Permanent Lok
Adalat. Particularly, with reference to the provisions contained in the
Consumer Protection Act, it is submitted that compensatory remedies
available under this law are in addition to and not in derogation of any
other law and since Permanent Lok Adalats have no jurisdiction to grant
compensatory relief, the jurisdiction of the consumer fora remains intact.
Reliance has been placed on the decisions of this Court in Fair Air
Engineers Pvt. Ltd. and another v. N.K. Modi[2], Skypak Couriers Ltd. v.
Tata Chemicals Ltd.[3], Trans Mediterranean Airways v. Universal Exports
and another[4] and National Seeds Corporation Limited v. M. Madhusudhan
Reddy and another[5]. National Seeds Corporation Limited5 was also
pressed into service in support of the submission that consumer protection
laws were enacted pursuant to the solemn international obligations of our
country and, therefore, the Permanent Lok Adalats cannot oust the
jurisdiction of the consumer courts. It is also submitted that the
jurisdiction of the consumer courts is protected unless it is expressly
barred even in cases where some disputes can be adjudicated in different
fora. Two decisions of this Court in this regard, namely, Secretary,
Thirumurugan Cooperative Agricultural Credit Society v. M. Lalitha (Dead)
through LRs. and Others[6] and Kishore Lal v. Chairman, Employees’ State
Insurance Corpn.[7] have been relied upon.
8. Mr. T.S. Doabia, learned senior counsel for the Union of India,
on the other hand, submitted that the issues raised in the writ petition
have already been decided by this Court in S.N. Pandey v. Union of India
(Writ Petition (Civil) No. 543/2002; decided on 28.10.2002) and the writ
petition deserves to be dismissed on this ground alone. He submitted that
the impugned provisions are in conformity with the objectives of Article
39A and intended to provide an affordable, speedy and efficient mechanism
to secure justice.
9. As regards decision of this Court in S.N. Pandey (supra), the
counsel for the petitioner in rejoinder would submit that the dismissal of
the earlier writ petition was in limine and would not be a binding
precedent. The decisions of this Court in B. Prabhakar Rao and others v.
State of Andhra Pradesh and others[8], Union of India and others v. Jaipal
Singh[9] were relied upon. Learned counsel for the petitioner also
submitted that in the earlier writ petition, there was no law declared
under Article 141 of the Constitution since points now raised in the
present writ petition were neither argued nor discussed. In this regard,
the learned counsel referred to the two decisions of this Court in B.
Shama Rao v. Union Territory of Pondicherry[10], Municipal Corporation of
Delhi v. Gurnam Kaur[11] and State of Punjab v. Baldev Singh[12] .
10. Article 39-A came to be inserted in the Constitution by
Constitution (42nd Amendment) Act, 1976 with effect from 3.1.1977. It
enjoins upon the State to secure that the operation of the legal system
promotes justice on the basis of equal opportunity and in particular to
provide free legal aid by suitable legislation or schemes or in any other
way and to ensure that opportunities for securing justice are not denied to
any citizen by reason of economic or other disabilities. Equal justice to
all and free legal aid are hallmark of Article 39-A. Pursuant to these
objectives, the 1987 Act was enacted by the Parliament to constitute legal
services authorities to provide free and competent legal services to the
weaker sections of the society 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 a basis of equal opportunity. The
statement of objects and reasons that led to enactment of 1987 Act reads as
follows :
“Article 39-A of the Constitution provides that the State shall
secure that the operation of the legal system promotes justice on
the basis of equal opportunity, and shall, in particular, provide
free legal aid, by suitable legislation or schemes or in any other
way, to ensure that opportunities for securing justice are not
denied to any citizen by reason of economic or other disabilities.
2. With the object of providing free legal aid, Government had, by
Resolution dated the 26th September, 1980 appointed the “Committee
for Implementing Legal Aid Schemes” (CILAS) under the Chairmanship
of Mr. Justice P.N. Bhagwati (as he then was) to monitor and
implement legal aid programmes on a uniform basis in all the States
and Union territories. CILAS evolved a model scheme for legal Aid
programme applicable throughout the country by which several legal
aid and advice boards have been set up in the States and Union
territories. CILAS is funded wholly by grants from the Central
Government. The Government is accordingly concerned with the
programme of legal aid as it is the implementation of a
constitutional mandate. But on a review of the working of the CILAS
certain deficiencies have come to the fore. It is, therefore, felt
that it will be desirable to constitute statutory legal service
authorities at the National, State and District levels so as to
provide for the effective monitoring of legal aid programmes. The
Bill provides for the composition of such authorities and for the
funding of these authorities by means of grants from the Central
Government and the State Governments. Power has been also given to
the National Committee and the State Committees to supervise the
effective implementation of legal aid schemes.
3. For some time now, Lok Adalats are being constituted at various
places in the country for the disposal, in a summary way and through
the process of arbitration and settlement between the parties, of a
large number of cases expeditiously and with lesser costs. The
institution of Lok Adalats is at present functioning as a voluntary
and conciliatory agency without any statutory backing for its
decisions. It has proved to be very popular in providing for a
speedier system of administration of justice. In view of its growing
popularity, there has been a demand for providing a statutory
backing to this institution and the awards given by Lok Adalats. It
is felt that such a statutory support would not only reduce the
burden of arrears of work in regular Courts, but would also take
justice to the door-steps of the poor and the needy and make justice
quicker and less expensive.”
11. For about a decade and half, the operation of the 1987 Act was
closely watched. It was felt that the system of Lok Adalats provided in
the 1987 Act sometimes results in delaying the dispensation of justice
where the parties do not arrive at any compromise or settlement in Lok
Adalat and the case is returned to the court of law or the parties are
advised to pursue appropriate remedy for redressal of their grievance.
Accordingly, amendment in the 1987 Act was felt by the Parliament to be
necessary. The statement of objects and reasons of the 2002 Amendment Act,
inter alia, reads as under:
“The Legal Services Authorities Act, 1987 was enacted to constitute
legal services authorities for providing and competent legal
services to the weaker sections of the society to ensure that
opportunities for securing justice were not denied to any citizen by
reason of economic or other disabilities and to organize Lok Adalats
to ensure that the operation of the legal system promoted justice on
a basis of equal opportunity. The system of Lok Adalat, which is an
innovative mechanism for alternate dispute resolution, has proved
effective for resolving disputes in a spirit of conciliation outside
the Court.
2. However, the major drawback in the existing scheme of
organisation of the Lok Adalats under Chapter VI of the said Act is
that the system of Lok Adalats is mainly based on compromise or
settlement between the parties. If the parties do not arrive at any
compromise or settlement, the case is either returned to the Court
of law or the parties are advised to seek remedy in a Court of law.
This causes unnecessary delay in the dispensation of justice. If Lok
Adalats are given power to decide the cases on merits in case
parties fails to arrive at any compromise or settlement, this
problem can be tackled to a great extent. Further, the cases which
arise in relation to public utility services such as Mahanagar
Telephone Nigam Limited, Delhi Vidyut Board, etc., need to be
settled urgently so that people get justice without delay even at
pre-litigation stage and thus most of the petty cases which ought
not to go in the regular Courts would be settled at the pre-
litigation stage itself which would result in reducing the workload
of the regular Courts to a great extent. It is, therefore, proposed
to amend the Legal Service Authorities Act, 1987 to set up Permanent
Lok Adalats for providing compulsory pre-litigative mechanism for
conciliation and settlement of cases relating to public utility
services.
3. The salient features of proposed legislation are as follows :-
(i) to provide for the establishment of Permanent Lok Adalats
which shall consists (sic) of a Chairman who is or has been a
District Judge or Additional District Judge or has held judicial
officer (sic) higher in rank than that of the District Judge and
two other persons having adequate experience in public utility
services;
(ii) the Permanent Lok Adalat shall exercise jurisdiction
in respect of one or more public utility services such as transport
services of passengers of goods by air, road and water, postal,
telegraph or telephone services, supply of power, light or water to
the public by any establishment, public conservancy or sanitation,
services in hospitals or dispensaries, and insurance services;
(iii) the pecuniary jurisdiction of the Permanent Lok
Adalat shall be up to Rupees Ten Lakhs. However, the Central
Government may increase the said pecuniary jurisdiction from time to
time. It shall have no jurisdiction in respect of any matter
relating to an offence not compoundable under any law;
(iv) it also provides that before the dispute is brought
before any Court, any party to the dispute may make an application
to the Permanent Lok Adalat for settlement of the dispute;
(v) where it appears to the Permanent Lok Adalat that there
exist elements of a settlement, which may be acceptable to the
parties, it shall formulate the terms of a possible settlement and
submit them to the parties for their observations and in case the
parties reach an agreement, the Permanent Lok Adalat shall pass an
award in terms thereof. In case parties to the dispute fail to reach
an agreement, the Permanent Lok Adalat shall decide the dispute on
merits; and
(vi) every award made by the Permanent Lok Adalat shall
be final and binding on all the parties thereto and shall be by a
majority of the persons constituting the Permanent Lok Adalat.”
12. With the above objectives, 2002 Amendment Act was enacted by
the Parliament and thereby Chapter VI-A (Sections 22-A to 22-E) was
brought in with few other consequential amendments elsewhere.
13. The title of Chapter VI-A is “Pre-litigation Conciliation and
Settlement”. Section 22-A(a) defines “Permanent Lok Adalat” to mean a
Permanent Lok Adalat established under sub-section (1) of Section 22-B.
“Public utility service” is defined in Section 22-A(b). It means (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. If the Central Government or the State
Government declares in the public interest, any service to be a public
utility service for the purposes of Chapter VI-A, such service on
declaration is also included in the definition of ‘public utility service’
under Section 22-A(b).
14. The establishment of Permanent Lok Adalat is done under Section
22-B. The Central Authority and every State Authority, as the case may be,
have been mandated to 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 notified. The composition of
Permanent Lok Adalat is provided in Section 22-B (2). Accordingly, every
Permanent Lok Adalat 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 and (b) two other persons
having adequate experience in public utility service to be nominated by the
Central Government or by the State Government, as the case may be on the
recommendation of the Central Authority or by the State Authority (as the
case may be). The judicial officer, namely, the District Judge or
Additional District Judge or the Judicial Officer higher in rank than that
of a District Judge shall be the Chairman of the Permanent Lok Adalat.
15. Section 22-C provides for the procedure for raising dispute
before the Permanent Lok Adalat. Sub-section (1) provides that any party to
a dispute may make an application to the Permanent Lok Adalat for the
settlement of dispute before the dispute is brought before any court.
However, Permanent Lok Adalat has no jurisdiction to deal with any matter
relating to an offence not compoundable under any law. The second proviso
puts a cap on the pecuniary jurisdiction inasmuch as it provides that the
Permanent Lok Adalat shall not have jurisdiction in a matter where the
value of the property in dispute exceeds ten lakh rupees. The Central
Government, however, may increase the limit of ten lakh rupees in
consultation with the Central Authority by notification.
16. Sub-section (2) of Section 22-C puts an embargo on the parties
to a dispute after an application has been made by any one of them under
sub-section (1) in invoking jurisdiction of any court in the same dispute.
16.1. Sub-section (3) of Section 22-C provides for the procedure to
be followed by the Permanent Lok Adalat once an application is made before
it by any party to a dispute under sub-section (1). This procedure includes
filing of a written statement by each party to the application stating
therein the facts and nature of the dispute and highlighting the points or
issues in such dispute and the documents and other evidence in support of
their respective written statement and exchange of copy of such written
statement together with copy of documents/other evidence. The Permanent Lok
Adalat may require any party to the application to file additional
statement before it at any stage of the conciliation proceedings. Any
document or statement received by Permanent Lok Adalat from any party to
the application is given to the other party. On completion of the above
procedure, the Permanent Lok Adalat proceeds with conciliation proceedings
between the parties to the application under sub-section (4) of Section 22-
C. During conduct of the conciliation proceedings under sub-section (4) of
Section 22-C, the Permanent Lok Adalat is obliged to assist the parties in
their attempt to reach an amicable settlement of the dispute in an
independent and impartial manner. Every party to the application has a duty
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.
16.2. On satisfaction that there is likelihood of settlement in the
proceedings, the Permanent Lok Adalat may formulate the terms of possible
settlement of the dispute and give to the parties for their observations
and where the parties reach at an agreement on the settlement of the
dispute, they shall sign the settlement/agreement and Permanent Lok Adalat
then passes an award in terms thereof and furnishes a copy of the same to
each of the parties concerned.
17. Upto the above pre-litigation conciliation and settlement
procedure, there is no problem or issue. The petitioner is seriously
aggrieved by the provision contained in Section 22-C(8) which provides that
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. This provision followed by Section 22-D which, inter-
alia, provides that while deciding a dispute on merit the Permanent Lok
Adalat shall not be bound by the Code of Civil Procedure, 1908 and the
Indian Evidence Act, 1872 and Section 22-E which accords finality to the
award of Permanent Lok Adalat under sub-section (1) and the provision made
in sub-section (4) that every award made by the Permanent Lok Adalat shall
be final and hence shall not be called in question in any original suit,
application or execution proceedings form mainly bone of contention. Are
these provisions violative of Article 14 of the Constitution of India and
contrary to rule of law, fairness and even- handed justice? are the
questions to be considered.
18. Chapter VI-A inserted by the 2002 Amendment Act in 1987 Act, as
its title suggests, provides for pre-litigation conciliation and settlement
procedure. The disputes relating to public utility service like transport
service for carriage of passengers or goods by air, road or water or
postal, telegraph or telephone service or supply of power, light or water
or public conservancy system or sanitation or service in hospital or
dispensary or insurance service, etc., in the very scheme of things deserve
to be settled expeditiously. Prolonged dispute in respect of the above
matters between the service provider and an aggrieved party may result in
irretrievable damage to either party to the dispute. Today, with
increasing number of cases, the judicial courts are not able to cope with
the heavy burden of inflow of cases and the matters coming before them. The
disputes in relation to public utility service need urgent attention with
focus on their resolution at threshold by conciliation and settlement and
if for any reason such effort fails, then to have such disputes adjudicated
through an appropriate mechanism as early as may be possible. With large
population in the country and many public utility services being provided
by various service providers, the disputes in relation to these services
are not infrequent between the service providers and common man. Slow
motion procedures in the judicial courts are not conducive for adjudication
of disputes relating to public utility service.
19. The statement of objects and reasons itself spells out the
salient features of Chapter VI-A. By bringing in this law, the litigation
concerning public utility service is sought to be nipped in the bud by
first affording the parties to such dispute an opportunity to settle
their dispute through the endeavours of the Permanent Lok Adalat and if
such effort fails then to have the dispute between the parties adjudicated
through the decision of the Permanent Lok Adalat. The mechanism provided in
Chapter VI-A enables a party to a dispute relating to public utility
service to approach the Permanent Lok Adalat for the settlement of dispute
before the dispute is brought before any court.
20. Parliament can definitely set up effective alternative
institutional mechanisms or make arrangements which may be more efficacious
than the ordinary mechanism of adjudication of disputes through the
judicial courts. Such institutional mechanisms or arrangements by no
stretch of imagination can be said to be contrary to constitutional scheme
or against the rule of law. The establishment of Permanent Lok Adalats and
conferring them jurisdiction upto a specific pecuniary limit in respect of
one or more public utility services as defined in Section 22-A(b) before
the dispute is brought before any court by any party to the dispute is not
anathema to the rule of law. Instead of ordinary civil courts, if other
institutional mechanisms are set up or arrangements are made by the
Parliament with an adjudicatory power, in our view, such institutional
mechanisms or arrangements cannot be faulted on the ground of arbitrariness
or irrationality.
21. The Permanent Lok Adalats under the 1987 Act (as amended by
2002 Amendment Act) are in addition to and not in derogation of Fora
provided under various statutes. This position is accepted by the Central
Government in their counter affidavit.
22. It is necessary to bear in mind that the disputes relating to
public utility services have been entrusted to Permanent Lok Adalats only
if the process of conciliation and settlement fails. The emphasis is on
settlement in respect of disputes concerning public utility services
through the medium of Permanent Lok Adalat. It is for this reason that sub-
section (1) of Section 22-C states in no unambiguous terms that any party
to a dispute may before the dispute is brought before any court make an
application to the Permanent Lok Adalat for settlement of dispute. Thus,
settlement of dispute between the parties in matters of public utility
services is the main theme. However, where despite the endeavours and
efforts of the Permanent Lok Adalat the settlement between the parties is
not through and the parties are required to have their dispute determined
and adjudicated, to avoid delay in adjudication of disputes relating to
public utility services, the Parliament has intervened and conferred power
of adjudication upon the Permanent Lok Adalat. Can the power conferred on
Permanent Lok Adalats to adjudicate the disputes between the parties
concerning public utility service upto a specific pecuniary limit, if they
do not relate to any offence, as provided under Section 22-C(8), be said
to be unconstitutional and irrational? We think not. It is settled law
that an authority empowered to adjudicate the disputes between the parties
and act as a tribunal may not necessarily have all the trappings of the
court. What is essential is that it must be a creature of statute and
should adjudicate the dispute between the parties before it after giving
reasonable opportunity to them consistent with the principles of fair play
and natural justice. It is not a constitutional right of any person to have
the dispute adjudicated by means of a court only. Chapter VI-A has been
enacted to provide for an institutional mechanism, through the
establishment of Permanent Lok Adalats for settlement of disputes
concerning public utility service before the matter is brought to the court
and in the event of failure to reach any settlement, empowering the
Permanent Lok Adalat to adjudicate such dispute if it does not relate to
any offence.
23. The difference between “courts” and “tribunals” has come up for
consideration before this Court on more than one occasion. Almost five
decades back, this Court in M/s. Harinagar Sugar Mills Ltd. v. Shyam Sundar
Jhunjhunwala and others[13] stated that by “courts” the courts of civil
judicature is meant and by “tribunals” those bodies of men who are
appointed to decide controversies arising under certain special laws. All
tribunals are not courts though all courts are tribunals. It was further
observed that in the exercise of judicial power, a clear division was
noticeable between courts and tribunals, particularly, certain special
matters go before tribunals, and the residue goes before the ordinary
Courts of Civil Judicature. Their procedures may differ, but the functions
are not essentially different. Both courts and tribunals act
“judicially”.
24. In Associated Cement Companies Ltd. v. P. N. Sharma & Anr.[14],
the Constitution Bench of this Court observed that under our Constitution,
the judicial functions and powers of the State have been primarily
conferred on the ordinary courts; the Constitution recognises a hierarchy
of courts and they are normally entrusted to adjudicate all disputes
between citizens and citizens as well as between the citizens and the
State. The powers which the courts exercise are judicial powers, the
functions they discharge are judicial functions and the decisions they
reach and pronounce are judicial decisions. The tribunals decide special
matters entrusted to them for their decision. The procedure which the
tribunals have to follow may not always be so strictly prescribed but the
approach adopted by both the courts and tribunals is substantially the
same; it is State’s inherent judicial function which they discharge.
25. In Kihoto Hollohan v. Zachillhu & Ors.[15], it has been stated
by this Court that where the authority is called upon to decide a lis on
the rights and obligations of the parties, there is an exercise of
judicial power. The authority is called a tribunal if it does not have
all the trappings of a court.
26. In a comparatively recent decision in Union of India v. R.
Gandhi, President, Madras Bar Association[16] (Civil Appeal No. 3067 of
2004); decided on May 11, 2010, a Constitution Bench of this Court was
concerned with the matters wherein the constitutional validity of Parts I-B
and I-C of the Companies Act, 1956 inserted by Companies (Second Amendment)
Act, 2002 providing for the Constitution of National Company Law Tribunal
and National Company Law Appellate Tribunal was under challenge. The Court
while examining the difference between the courts and tribunals, inter
alia, referred to earlier decisions of this Court, some of which have been
noted above. The Court summarized the legal position as follows:
“(a) A legislature can enact a law transferring the jurisdiction
exercised by courts in regard to any specified subject (other than
those which are vested in courts by express provisions of the
Constitution) to any tribunal.
(b) All courts are tribunals. Any tribunal to which any existing
jurisdiction of courts is transferred should also be a Judicial
Tribunal. This means that such Tribunal should have as members,
persons of a rank, capacity and status as nearly as possible equal to
the rank, status and capacity of the court which was till then dealing
with such matters and the members of the Tribunal should have the
independence and security of tenure associated with Judicial
Tribunals.
(c) Whenever there is need for ‘Tribunals’, there is no presumption
that there should be technical members in the Tribunals. When any
jurisdiction is shifted from courts to Tribunals, on the ground of
pendency and delay in courts, and the jurisdiction so transferred does
not involve any technical aspects requiring the assistance of experts,
the Tribunals should normally have only judicial members. Only where
the exercise of jurisdiction involves inquiry and decisions into
technical or special aspects, where presence of technical members will
be useful and necessary, Tribunals should have technical members.
Indiscriminate appointment of technical members in all tribunals will
dilute and adversely affect the independence of the Judiciary.
(d) The Legislature can re-organize the jurisdictions of Judicial
Tribunals. For example, it can provide that a specified category of
cases tried by a higher court can be tried by a lower court or vice
versa (A standard example is the variation of pecuniary limits of the
courts). Similarly while constituting Tribunals, the Legislature can
prescribe the qualifications/eligibility criteria. The same is however
subject to Judicial Review. If the court in exercise of judicial
review is of the view that such tribunalisation would adversely affect
the independence of the judiciary or the standards of the judiciary,
the court may interfere to preserve the independence and standards of
the judiciary. Such an exercise will be part of the checks and
balances measures to maintain the separation of powers and to prevent
any encroachment, intentional or unintentional, by either the
legislature or by the executive.”
27. The competence of the Parliament to make a law creating
tribunals to deal with disputes arising under or relating to a particular
statute or statutes or particular disputes is, thus, beyond question.
28. Sine qua non of taking cognizance of a dispute concerning
public utility service by the Permanent Lok Adalat is that neither party to
a dispute has approached the civil court. There is no merit in the
submission of the petitioner that the service provider may pre-empt the
consideration of a dispute by a court or a forum under special statute by
approaching the Permanent Lok Adalat established under Chapter VI-A of the
1987 Act and, thus, depriving the user or consumer of such public utility
service of an opportunity to have the dispute adjudicated by a civil court
or a forum created under special statute. In the first place, the
jurisdiction of fora created under the Special Statutes has not been taken
away in any manner whatsoever by the impugned provisions. As noted above,
the Permanent Lok Adalats are in addition to and not in derogation of fora
provided under Special Statutes. Secondly, not a single instance has been
cited where a provider of service of public utility in a dispute with its
user has approached the Permanent Lok Adalat first. The submission is
unfounded and misplaced.
29. The alternative institutional mechanism in Chapter VI-A with
regard to the disputes concerning public utility service is intended to
provide an affordable, speedy and efficient mechanism to secure justice.
By not making applicable the Code of Civil Procedure and the statutory
provisions of the Indian Evidence Act, there is no compromise on the
quality of determination of dispute since the Permanent Lok Adalat has to
be objective, decide the dispute with fairness and follow the principles
of natural justice. Sense of justice and equity continue to guide the
Permanent Lok Adalat while conducting conciliation proceedings or when the
conciliation proceedings fail, in deciding a dispute on merit.
30. Insofar as composition of Permanent Lok Adalat is concerned,
Section 22-B(2) provides that every Permanent Lok Adalat shall consist of 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 and
two other persons having adequate experience in public utility service to
be nominated by the Central Government or the State Government, as the case
may be, on the recommendation of the Central Authority or the State
Authority, as the case may be. Of the three members, the judicial officer
is the Chairman of the Permanent Lok Adalat. The Central Authority under
Section 3 of the 1987 Act, inter alia, consists of the Chief Justice of
India, a serving or retired Judge of the Supreme Court to be nominated by
the President in consultation with the Chief Justice of India and the other
members to be nominated by the Central Government in consultation with the
Chief Justice of India. The Chief Justice of India is the Patron-in-Chief
of the Central Authority while a serving or retired Judge of the Supreme
Court is the Executive Chairman. Similarly, the State Authority under
Section 6 consists of the Chief Justice of the High Court, a serving or
retired Judge of the High Court to be nominated by the Governor in
consultation with the Chief Justice of the High Court and such number of
other members to be nominated by the State Government in consultation with
the Chief Justice of the High Court. It would be, thus, seen that the two
members other than the judicial officer of a Permanent Lok Adalat can be
appointed by the Central Government or the State Government, as the case
may be, on the recommendation of the Central Authority or the State
Authority only. The composition of Central Authority and the State
Authority has been noted above. In the above view, it is misconceived to
say that the judiciary has been kept out in the appointment of members of
the Permanent Lok Adalats. The independence of Permanent Lok Adalats does
not seem to have been compromised at all as even the non-judicial members
of every Permanent Lok Adalat have to be appointed on the recommendation
of a high powered Central or State Authority headed by none other than the
Chief Justice of India or a serving or retired Judge of the Supreme Court
where the nomination is made by the Central Government or by the Chief
Justice of the State High Court or a serving or retired Judge of the High
Court where the nomination is made by the State Government.
31. It is not unusual to have the tribunals comprising of judicial
as well as non-judicial members. The whole idea of having non-judicial
members in a tribunal like Permanent Lok Adalat is to make sure that the
legal technicalities do not get paramountcy in conciliation or adjudicatory
proceedings. The fact that a Permanent Lok Adalat established under Section
22-B comprises of one judicial officer and two other persons having
adequate experience in public utility service does not show any abhorrence
to the rule of law nor such composition becomes violative of principles of
fairness and justice or is contrary to Articles 14 and 21 of the
Constitution of India.
32. It is true that the award made by the Permanent Lok Adalat
under 1987 Act has to be by majority of the persons constituting the
Permanent Lok Adalat. In a given case, it may be that the two non-judicial
members disagree with the judicial member but that does not mean that such
majority decision lacks in fairness or sense of justice.
33. There is no inherent right of appeal. Appeal is always a
creature of statute and if no appeal is provided to an aggrieved party in a
particular statute, that by itself may not render that statute
unconstitutional. Section 22-E(1) makes every award of the Permanent Lok
Adalat under 1987 Act either on merit or in terms of a settlement final
and binding on all the parties thereto and on persons claiming under them.
No appeal is provided from the award passed by the Permanent Lok Adalat but
that, in our opinion, does not render the impugned provisions
unconstitutional. In the first place, having regard to the nature of
dispute upto a specific pecuniary limit relating to public utility service
and resolution of such dispute by the procedure provided in Section 22-C(1)
to 22-C(8), it is important that such dispute is brought to an end at the
earliest and is not prolonged unnecessarily. Secondly, and more
importantly, if at all a party to the dispute has a grievance against
the award of Permanent Lok Adalat he can always approach the High Court
under its supervisory and extraordinary jurisdiction under Articles 226 and
227 of the Constitution of India. There is no merit in the submission of
the learned counsel for the petitioner that in that situation the burden of
litigation would be brought back on the High Courts after the award is
passed by the Permanent Lok Adalat on merits.
34. The challenge to the validity of the impugned provisions came
up before this Court in S.N. Pandey (supra). A three-Judge Bench of this
Court was not persuaded by the challenge and held as under:
“We have gone through the provisions of the said Chapter which
contemplated the setting up of permanent Lok Adalats, for deciding
disputes in which public utility services is one of the matters
involved. It is quite obvious that the effort of the legislature is to
decrease the work load in the Courts by resorting to alternative
disputes resolution. Lok Adalat is a mode of dispute resolution which
has been in vogue since over two decades. Hundreds of thousands of
cases have been settled through this mechanism and is undisputedly a
fast means of dispensation of justice. The litigation is brought to a
quick end with no further appeals or anguish to the litigants. The
constitution of the permanent Lok Adalats mechanism contemplate the
judicial officer or a retired judicial officer being there alongwith
other persons having adequate experience in the public utility
services.
We do not find any constitutional infirmity in the said legislation.
The act ensures that justice will be available to the litigant
speedily and impartially. We do emphasis that the persons who are
appointed on the Permanent Lok Adalats should be person of integrity
and adequate experience. Appropriate rules, inter alia in this regard,
no doubt will have to be framed, if not already in place.
We upheld the validity of the said Act and hope the Permanent Lok
Adalats will be set up at an early date. The Lok Adalats are enacted
to Primarily bring about settlement amongst the parties. The parties
are normally required to be present in person and since the impugned
provisions are in the interest of the litigating public, the Lok
Adalats shall perform their duties and will function; even if members
of the Bar choose not to appear.”
35. Learned counsel for the petitioner submitted that the disposal
of the writ petition filed by S.N. Pandey was in limine and the order
passed therein cannot be construed as a binding precedent. It was also
submitted that the said decision does not declare any law under Article 141
of the Constitution since points now raised in the present matter, were
neither argued nor discussed.
36. We are not persuaded by the submission of the learned counsel
for the petitioner. Although the disposal of writ petition in S.N. Pandey
was in limine and the order is brief but the court has disposed of the same
on merits. In B. Prabhakar Rao8 , O. Chinnappa Reddy ,J. did observe in
para 22 that the dismissal in limine of a writ petition cannot possibly
bar the subsequent writ petitions but at the same time he also observed
that such a dismissal in limine may inhibit the discretion of the Court. V.
Khalid, J. in his supplementing judgment in para 27(6) exposited the
position that normally this Court would be disinclined to entertain or to
hear petitions raising identical points again where on an earlier occasion,
the matter was heard and dismissed. Not that this Court had no jurisdiction
to entertain such matters, but would normally exercise its discretion
against it. We are in complete agreement with the above view of V. Khalid,
J. It is against public policy and well defined principles of judicial
discretion to entertain or hear petitions relating to same subject matter
where the matter was heard and dismissed on an earlier occasion.
37. Independent of the view of this Court in S.N. Pandey, for the
reasons that we have indicated above, we find no merit in the challenge to
the impugned provisions of Chapter VI-A brought in the 1987 Act by 2002
Amendment Act.
38. We, accordingly, dismiss the writ petition with no order as to
costs.
…………………….. J.
(R.M. Lodha)
………………………J.
(Anil R. Dave)
NEW DELHI.
AUGUST 3, 2012.
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[1] (1976) (1) SCC 496
[2] (1996) 6 SCC 385
[3] (2000) 5 SCC 294
[4] (2011) 10 SCC 316
[5] (2012) 2 SCC 506
[6] (2004) 1 SCC 305
[7] (2007) 4 SCC 579
[8] 1985 (Supp) SCC 432
[9] (2004) 1 SCC 121
[10] AIR 1967 SC 1480
[11] (1989) 1 SCC 101
[12] (1999) 6 SCC 172
[13] 1962 (2) SCR 339
[14] (1965) 2 SCR 366
[15] 1992 Supp (2) SCC 651
[16] (2010) 11 SCC 1
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