1. The petitioners have challenged the validity of judgment and award dated 29.12.2010, passed by the learned Permanent Lok Adalat, Tripura, Agartala, in connection with LA Case (PUS) No. 05 of 2010, wherein the petitioners were directed to pay the assured sum of Rs. 1,00,000 (Rupees One lakh) to the claimant respondent within a period of one month together with interest thereon and also cost of Rs. 5,000.

2. I have heard Mr. A. Lodh, learned counsel for the writ petitioners, and Mr. T.D Majumder, learned counsel appearing for the respondent.

3. The pleaded case of the petitioners is that the respondent as claimant lodged a complaint before the learned Permanent Lok Adalat, Tripura, Agartala, stating therein, that the opposite parties-petitioners, as insurer, had issued a Postal Life Insurance Policy bearing No. NE-27170-CS dated 12.4.2006, in the name of her husband Harilal Ghosh, for a sum of Rs. 1,00,000 (Rupees One lakh). The aforesaid sum was proposed to be matured on 20.3.2019 However, unfortunately, the husband of the respondent died on 10.1.2007 Accordingly, the respondent claimed benefit of the insurance policy before the petitioners. However, by a letter dated 17.6.2009, the petitioners repudiated the claim of the respondent on the ground that the husband of the respondent died due to hypertension within eleven months from the date of acceptance of the proposal, whereas in the proposal form the husband of the respondent had declared that he was in sound health and he had never suffered from any disease like ‘hypertension’. Since it was found in the death certificate of the insured that the cause of death was ‘an old case of uncontrolled hypertension’, the claim was repudiated.

4. As against the aforesaid claim, the petitioners filed written statement, disputing the claim of the respondent by stating therein, that the proposal form was duly filled in and signed by the insured person in his own handwriting and on the basis of such declaration, furnished by the insurant, PLI policy for Rs. 1,00,000 was accepted by the competent authority of the petitioners on 20.3.2006 It was, however, contended in the written statement that subsequently it was found that the insured had furnished inaccurate information and suppressed the material facts at the time of opening of the policy of insurance, since it was found in the death certificate of the insurant that the insurant died due to ‘cardio respiratory disease, which was an old case of uncontrolled hypertension’ and was continuing within eleven months from the date of acceptance of the insurance proposal.

5. During proceeding of the case on the basis of the above pleadings, learned Permanent Lok Adalat framed as many as 4(four) issues and also obtained evidences on affidavit of the witnesses of both the parties, which were supported by various documents to sustain their respective stands. Thereafter, on appraisal of the evidence on record and after threadbare discussions of all the issues so framed, the learned Permanent Lok Adalat awarded the claim of the respondent as aforesaid, which is the subject-matter of the instant writ petition.

6. Mr. A. Lodh, learned counsel for the petitioners submitted that the petitioners have never given consent for inviting decision on merits from the Permanent Lok Adalat, on the contrary, there was clear denial to conciliate the case before the Permanent Lok Adalat by disputing the genuineness of the claim. Learned counsel for the petitioners has relied upon the following decision in Divisional Manager National Insurance Company v. Usha Singh, AIR 2011 Jhar. 5 and has submitted that unless the consent is given in writing, the Permanent Lok Adalat has no power, jurisdiction and authority to decide the issue on merits and further submitted that there is clear breach of sub-section (7) of section 22C of the Legal Services Authorities Act, 1987 (‘the Act’). Moreover, there is breach of sub-section (8) of section 22C of the Act, 1987 and, therefore, the impugned order deserves to be quashed and set aside.

7. Mr. A. Lodh, learned counsel for the petitioners has submitted that learned Permanent Lok Adalat, while disposing of the claim filed by the claimant-respondent, had adopted an adjudicatory role and not a conciliatory role, which is beyond the scope and object of the provisions of the Act. Learned counsel for the petitioners also pointed out that there was no endeavour whatsoever, by the learned Permanent Lok Adalat to make an attempt to reach to an amicable settlement of the dispute in an objective and impartial manner and nowhere in the impugned judgment, it has been reflected by the learned Members of the Permanent Lok Adalat that it had formulated a terms of possible settlement of the dispute, or given the party concerned any observation to enable the parties to arrive at an amicable settlement of the issues raised.

8. It would be pertinent herein to look into the provisions of section 22C of the Act, which read as follows:

“22C. Cognizance of cases by Permanent Lok Adalat.— (1) Any party to a dispute may, before the dispute is brought before any court, make an application to the Permanent Lok Adalat for the settlement of dispute:

Provided that the Permanent Lok Adalat shall not have jurisdiction in respect of any matter relating to an offence not compoundable under any law:

Provided further that the Permanent Lok Adalat shall also not have jurisdiction in the matter where the value of the property in dispute exceeds ten lakh rupees:

Provided also that the Central Government, may by notification, increase the limit often lakh rupees specified in the second proviso in consultation with the Central Authority.

(2) After an application is made under sub-section (1) to the Permanent Lok Adalat, no party to that application shall invoke jurisdiction of any court in the same dispute.

(3) Where an application is made to a Permanent Lok Adalat under sub-section (1), it—

(a) shall direct each party to the application to file before it a written statement, stating therein the facts and nature of dispute under the application, points or issues in such dispute and grounds relied in support of, or in opposition to, such points or issues, as the case may be, and such party may supplement such statement with any document and other evidence which such party deems appropriate in proof of such facts and grounds and shall send a copy of such statement together with a copy of such document and other evidence, if any, to each of the parties to the applicant;

(b) may require any party to the application to file additional statement before it at any stage of the conciliation proceedings;

(c) shall communicate any document or statement received by it from any party to the application to the other party, to enable such other party to present reply thereto.

(4) When statement, additional statement and reply, if any, have been filed under sub-section (3), to the satisfaction of the Permanent Lok Adalat, it shall conduct conciliation proceedings between the parties to the application in such manner as it thinks appropriate taking into account the circumstance of the dispute.

(5) The Permanent Lok Adalat shall, during conduct of conciliation proceedings under sub-section (4), assist the parties in their attempt to reach an amicable settlement of the dispute in an independent and impartial manner.

(6) It shall be the duty of every party to the application to co-operate 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.

(7) When a Permanent Lok Adalat, in the aforesaid conciliation proceedings, is of opinion that there exist elements of settlement in such proceedings which may be acceptable to the parties, it may formulate the terms of a possible settlement of the dispute and give to the parties concerned for their observations and in case the parties reach at an agreement on the settlement or the dispute, they shall sign the settlement agreement and the Permanent Lok Adalat shall pass an award in terms thereof and furnish a copy of the same to each of the parties concerned.

(8) 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.”

9. On careful appraisal of the provisions of section 22C of the Act, it appears that any party to a dispute, before the dispute is brought before any court make an application to the Permanent Lok Adalat for the settlement of dispute.

10. It has been specifically provided in sub-sections (4), (5), (6) and (7) of section 22C of the Act that the Permanent Lok Adalat, during conduct of conciliation proceedings under sub-section (4), it shall assist the parties in their attempt to reach an amicable settlement of the dispute in an independent and impartial manner, and it shall be the duty of every party to the application to co-operate 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. When a Permanent Lok Adalat, in the aforesaid conciliation proceedings, is of the opinion that there exist elements of settlement in such proceedings, which may be acceptable to the parties, it may formulate the terms of a possible settlement of the dispute and give to the parties concerned for their observations and in case the parties reach at an agreement on the settlement of the dispute, they shall sign the settlement agreement and the Permanent Lok Adalat shall pass an award in terms thereof and furnish a copy of the same to each of the parties concerned. However, if the parties fail to reach to an agreement under sub-section (7), the Permanent Lok Adalat shall, if the dispute does not relate to any offence, in terms of the above provision, with the approval of the parties, decide the dispute.

11. In terms of the provisions of section 22C(7), it clearly transpires that the Permanent Lok Adalat has to formulate the terms of a possible settlement of the dispute and give to the parties concerned for their observations. However, in the instant case, as rightly pointed out by the learned counsel for the petitioners, no such initiative was ever taken up by the learned Members of the Permanent Lok Adalat, for a possible settlement of the dispute between the parties. Neither any observation, nor any opinion was expressed by the learned Permanent Lok Adalat as to whether any element of settlement existed for a possible settlement.

12. The very purpose of establishment of a Permanent Lok Adalat is to take an initiative for a settlement of the dispute between the parties without litigation. However, in the instant case, as it appears, such an effort for conciliation by the learned Permanent Lok Adalat is conspicuously absent.

13. Mr. Lodh, learned counsel for the petitioners, by referring to a decision, reported in Usha Sinha (supra), has submitted that the duty of the Permanent Lok Adalat is to bring parties to a settlement instead of adjudicating the dispute itself without making any effort for conciliation. The Permanent Lok Adalat has no jurisdiction to directly invoke the provisions of section 22C(8) of the Act and decide the dispute on merit against the will of the party. The relevant observations made by the learned Single Bench of Jharkhand High Court, read as follows:

“8. The scope of the powers of the Permanent Lok Adalat under the provisions of sections 22C and 22D of the Legal Service Authority Act, has been elaborately discussed and explained by this court in several judgments. A Division Bench judgment of this court in the case of Bharat Sanchar Nigam Ltd. v. State of Jharkhand., 2008 (3) JLJR 513 : 2009 (1) AIR Jhar. R 77, has held as follows:

“The duty of the Permanent Lok Adalat is to bring parties to a settlement instead of adjudicating the dispute. The Permanent Lok Adalat has no jurisdiction to directly invoke the provisions of section 22C(8) and decide the dispute on merit against the will of the party.”

14. The Permanent Lok Adalats are saddled with a pious duty of using their wisdom, knowledge and experience, for settlement of the dispute between the parties. The Permanent Lok Adalat should offer terms of settlement on its own. Thereafter, some time have to be given to the parties to the dispute to enable them to come to a settlement. If they offer their terms of settlement, it can be accepted by the Permanent Lok Adalat or if they accept the terms of settlement, offered by Permanent Lok Adalat, then also an award can be passed, as agreed to by the parties. Except as above, the Permanent Lok Adalat cannot directly take a decision, on merits. Even thereafter a written consent must be given by the parties to the Permanent Lok Adalat for deciding the dispute, on merits. Unless a written consent is given by the parties, for deciding the dispute, on merits, the Permanent Lok Adalat shall not exercise power to decide the issues, on merits in terms of section 22C(8) of the Act.

15. Mr. Lodh, learned counsel for the petitioners submitted that the main role of the Permanent Lok Adalat is of a mediator and not of an adjudicator.

16. As matter of fact, the Permanent Lok Adalat should not consider itself as a normal court meant for adjudication of disputes. The Permanent Lok Adalat, may not cross the barrier set up by the Act and decide the issue on merits doing the role of a civil court. The experienced judicial officer manning the Permanent Lok Adalat should utilize their knowledge and perception for reconciliation and not for deciding the dispute on merit, since for deciding such dispute on merit other courts of appropriate jurisdiction, are available. Unless the consent is given in writing by both the parties, the Permanent Lok Adalat has no power, jurisdiction and authority to decide the issue on merits, under sub-section (8) of section 22C of the Act. As the basic object of enacting section 22C is to get the disputes settled at the pre-litigation stage, resorting to the provision of sub-section (8) of section 22C of the Act, would be inappropriate, since the Permanent Lok Adalat failed to apply the provisions of sub-sections (4) to (7) of section 22C of the Act.

17. In view of the above, a duty is cast on the Permanent Lok Adalat to offer terms of settlement under sub-section (7) of section 22C of the Act, 1987. Apparently, in the instant case no such terms of settlement were ever offered by the Permanent Lok Adalat, under sub-section (7) of section 22C of the Act, and instead of exercising conciliatory role to bring the parties into a settlement, the Permanent Lok Adalat unfortunately, took adjudicatory role and went on to decide the dispute on merit, just like any other civil court, therefore, the impugned order, which is apparently is illegal deserves to be quashed and set aside.

18. Considering the facts and circumstances discussed above, I find merit in this writ petition, and accordingly, the same is allowed. Consequently, the impugned judgment and award dated 29.12.2010, passed by the learned Permanent Lok Adalat, Tripura, Agartala, in connection with LA Case (PUS) No. 05 of 2010, is hereby set aside and the matter is remitted back to the learned Permanent Lok Adalat, Tripura, Agartala, for passing appropriate order in accordance with law.

19. This writ petition stands disposed of in terms of the above observations and directions.