Can’t challenge after consenting: Jammu and Kashmir and Ladakh High Court upholds Lok Adalat award

Justice Wasim Sadiq Nargal

Cheque dishonour

The petitioner had issued two cheques of Rs 50,000 each in favour of the complainant. The cheques, however, were dishonoured due to ‘funds insufficient’ and ‘alterations require drawer’s attention,’ prompting the complainant to initiate criminal proceedings under Sections 138 and 142 of the Negotiable Instruments Act.

Subsequently, the matter was referred to the Lok Adalat after the petitioner gave an undertaking regarding payment.

On March 8, 2025, the Lok Adalat recorded a settlement under which the petitioner agreed to pay Rs 3.8 lakh by the end of March 2025.

Feeling aggrieved by the award passed by the Lok Adalat, the petitioner approached the high court.

‘Lawful and binding award’

The high court held that a Lok Adalat award based on voluntary settlement attains finality and is executable as a decree of a civil court.

The court observed that interference under Articles 226 and 227 of the Constitution is permissible only on limited grounds such as fraud, coercion, lack of free consent, or jurisdictional error.

The court found no material to support the petitioner’s claim of coercion or lack of consent. It noted that he had participated in the proceedings, acknowledged liability, and consciously entered into the settlement.

“The petitioner had appeared before the learned Magistrate, his statement under Section 251 Code of Criminal Procedure was recorded, and thereafter, upon an undertaking given by him with regard to payment, the matter was referred to the Lok Adalat. The petitioner, thus, was fully aware of the proceedings and consciously participated in the settlement process,” the court observed.

The court held that mere subsequent failure on the part of the petitioner to adhere to the terms of the settlement cannot be a ground to invalidate otherwise lawful and binding Lok Adalat award.

It further remarked that if the petitioner was dissatisfied with the award, he could have withdrawn from the proceedings, as is permissible in law, instead of consciously participating therein and appending his signature to the settlement.

“The petitioner has neither alleged nor established that the settlement was vitiated by fraud, coercion, misrepresentation, or lack of free consent. The absence of such foundational pleadings, the challenge essentially seeks to reopen a concluded settlement on technical grounds, which runs contrary to the very object of the Act,” the court held.

The court therefore upheld the Lok Adalat award and dismissed the petition.

‘Growing tendency’

• Before parting with the case, the court expressed concern over the growing trend of parties challenging Lok Adalat awards after consenting to settlements, observing that such conduct defeats the very purpose of Lok Adalats, which were created to provide speedy, amicable, and cost-effective dispute resolution while reducing the burden on regular courts.
• “This Court is constrained to observe that, day in and day out, it is coming across cases where parties seek to challenge awards passed by Lok Adalats. This growing tendency leads to the unnecessary invocation of the writ jurisdiction of this Court and results in a waste of valuable judicial time, which ought to be devoted to genuine and deserving matters,” the court said.
• It remarked that the parties cannot be permitted to act in a mischievous or evasive manner by ostensibly consenting to a settlement during the proceedings and thereafter resiling from the same.