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Judgment
Aparesh Kumar Singh, J.—Heard learned counsel for the parties. The order dated 25.8.2006 passed by the Permanent Lok Adalat, Ranchi in PLA Case No. 63 of 2006 is under challenge whereby the petitioner-Insurance Company has been directed to pay Rs. 50,000/- to the respondent/claimants u/s 140 of the Motor Vehicles Act, 1988.
The grievance of the petitioner is that the Permanent Lok Adalat, without following the procedure prescribed u/s 22(C)(4) to (7) of the Act, has proceeded straightway and passed the order directing the petitioner-Insurance Company to make payment to the respondents/claimants, which is contrary to law laid down by this Court. Learned counsel for the petitioner submits that in Pre-Litigative Case claim was preferred by the claimants, petitioner-Insurance Company was issued notice to appear and thereafter, the Permanent Lok Adalat made no attempt to conciliate the dispute between the parties or frame any terms of settlement neither offered it to the rival parties to come to a compromise on the terms of settlement. It is submitted that adjudication on merit in a dispute before the Permanent Lok Adalat u/s 22(C)(8) is only permissible after failure of the parties to arrive at conciliation and/or to agree to the terms of settlement framed and offer to the rival parties by the Permanent Lok Adalat.
Learned counsel for the claimants are not in a position to dispute that the aforesaid exercise which was never undertaken by the Permanent Lok Adalat while passing the impugned order straightway directing the petitioner-Insurance Company to make a payment of Rs. 50,000/- u/s 140 of the Motor Vehicles Act, 1988.
However, it is submitted that the amount itself has been paid to the claimants u/s 166 of the Motor Vehicles Act, 1988, which is pending before the Permanent Lok Adalat being PLA Case No. 64 of 2006 for conciliation between the parties.
This fact is not disputed by the petitioner as well.
This issue is no longer res Integra that in a matter of adjudication offered in motor vehicle accident claim case, the Permanent Lok Adalat can entertain a claim, but can adjudicate the dispute in accordance with law under the provision of 22(C)(4) to (7) of the Act. It has to first make an attempt to conciliate between the parties or offer the terms of settlement to the rival parties to arrive at a compromise over the same and only upon failure to do so, the Permanent Lok Adalat can proceed to adjudicate the dispute on merit.
The instant issue has already been settled by the judgment of this Court reported in W.P.(C) No. 1449 of 2008 Reported in 2009(2) JLJR 684. vide order dated 9.4.2009 in the case of State Bank of India, Dhanbad vs. State of Jharkhand & Anr., and in the case of Oriental Insurance Company Limited, Kutchery Road, Ranchi vs. Bodya Oraon and Anr. passed in W.P.(C) No. 1975 of 2007 Reported in 2012(3) JLJR 213. dated 30.4.2012 by the Division Bench of this Court.
In the circumstances, it is apparent that the impugned order is in violation of the mandate of the Legal Services Authority Act, 1987 as also laid down by this Court in the judgments quoted supra and therefore, the Permanent Lok Adalat has acted beyond its jurisdiction and it has failed to comply the procedure before deciding the dispute on merit under the statute under which it is created. The impugned order, therefore, deserves to be set aside and is, accordingly, quashed.
However, since the petitioner Insurance Company has already deposited the awarded amount of Rs. 50,000/-, the same shall be subject to final outcome of the proceeding u/s 166 of the Motor Vehicles Act, 1988 in PLA Case No. 64 of 2006, which is pending for conciliation before the Permanent Lok Adalat, Ranchi. With the aforesaid observations, this writ petition is allowed.