This blog has been authored by Saumya Singh. The Author was a III Year B.A. LL.B. (Hons.) student at the National Law School of India University, Bangalore at the time of original publication (Article originally published as "Empowering The ‘Lok’ In Permanent Lok Adalats Of Party Autonomy And Procedural Fairness Under The PLA Mechanism" on 27 June 2022). The author wishes to express his gratitude towards Prof. Ashok Patil (Professor of Law, NLSIU, Bangalore) for his valuable guidance and suggestions in the preparation of an earlier version of this paper. All errors are attributable entirely to the author.
Abstract
The Lok Adalat mechanism has traditionally been envisaged as a significant path towards
realising the constitutional commitment of equal access to justice for all citizens. It bears the
potential to aid parties, especially the socially and economically underprivileged, in accessing
expedited and inexpensive dispute resolution through conciliation before an impartial panel.
In the statutory conceptualisation of this mechanism, party autonomy and consent to the
proceedings have been accorded central importance. However, the Permanent Lok Adalat
mechanism introduced in 2002 has allowed such panels to decide disputes on merits if the
parties do not consent to a settlement.
This piece argues that this measure evinces a disproportionate legislative focus on higher
settlement rates and quick disposals. In removing the requirement of parties’ consent, the
PLA mechanism pays inadequate attention to, and significantly prejudices, procedural
fairness and access to justice for the parties, especially the underprivileged. The post further
suggests some reforms that can adequately balance all of these objectives.
Locating Lok Adalats in the Constitutional Commitment to Equal Access to Justice
A fundamental tenet of Indian constitutionalism is equal access to justice for all citizens in the various spheres of life. This commitment has been recognised as an integral part of the constitutional guarantees under Articles 14 and 21. Nevertheless, the same has remained an elusive aspiration, for the judicial system has remained inaccessible to a substantial portion of the Indian population to enforce their constitutional and legal rights. This is because of significant institutional barriers (high costs, vexation, and delay) that disproportionately curtail access to justice for the members of the socially and economically underprivileged sections of society, who lack the requisite legal awareness, material resources, and social capital to undertake the adversarial battle. Further, these social and institutional barriers might not be able to be sufficiently addressed through litigation-oriented legal aid. Hence, many recent legal aid initiatives have focussed on promoting Alternative Dispute Resolution (ADR) mechanisms to democratise access to justice in India.
A crucial ADR mechanism that has been sought to be promoted to this end is that of Lok Adalats (hereinafter ‘LA’). Broadly, the LA system refers to an ADR mechanism which involves the resolution of conflicts through conciliation and settlement in informal forums, before panels of third parties. The features of this mechanism, as well as its inherent link with the democratisation of access to justice, will subsequently be discussed.
The LA Mechanism: A path towards Democratising Access to Justice for the Underprivileged
The evolution of LAs in independent India has intrinsically been linked to attempts to ensure legal aid and widespread access to justice for the people. The primary objective of the LA mechanism, as explicated in the LSAA’s long title, was to provide legal aid to the underprivileged sections of society, so as to ensure equal opportunity for all to access justice in an affordable and time-effective manner. Ameliorating the docket explosion in Courts formed only a secondary objective of the measure, as is patent from its absence in the LSAA’s long title.
Under this mechanism, any case (except a non-compoundable offence) can be referred to the informal forum termed the LA, at both the pre- and post-litigation stages. These cases are placed before panels that have a serving or retired judge (usually) as the presiding officer, and advocates or social workers as the members. This LA panel aids the parties in arriving at a voluntary compromise or settlement in the matter: it cannot decide the dispute on merits. The presence of persons with legal expertise in the panel is aimed at ensuring that the parties understand their respective rights and obligations, and that lawful settlements are reached through a fair process. In this endeavour, the LA panels are not bound to follow the procedural laws binding on formal courts, such as the Civil Procedure Code, 1908 (hereinafter ‘CPC’) or the Indian Evidence Act, 1872 (hereinafter ‘IEA’). Instead, they can devise their own procedure in line with the “principles of justice, equity, fair play and other legal principles”. This procedural dilution is aimed at reducing the delays, costs, and vexation that usually accompany compliance with the requirements of intricate procedural laws in Indian Courts.
If the parties agree to a compromise or settlement, the same is recorded as an award of the LA, which is deemed to be a binding decree of the Civil Court. Given that these awards are arrived at by mutual consent, they are not subject to appeal, revision, or review. This prevents increased vexation, costs, and delay through re-litigation of the consensually settled dispute.
Hence, the LSAA has envisaged LAs are an ADR mechanism for promoting equal access to justice through an expedited, inexpensive, and conciliatory process, with a central focus on the parties’ agency and free consent during the process. The LA panel is vested with only a facilitative role in helping the parties chart the course of their dispute. However, the 2002 amendments to the LSAA have made some radical departures from these tenets. Hence, their implications for the parties’ autonomy and the procedural fairness must be examined.
Problematising Voluntariness and Party Autonomy: The Rise of Permanent LAs
The Permanent Lok Adalat (‘Permanent LA’) mechanism was introduced in the context of some LA proceedings where even reasonable settlements were precluded by either or both parties’ refusal to settle, potentially as a dilatory tactic. The mechanism was aimed at expediting the dispensation of justice by addressing the ‘drawback’ of the statutory requirement of parties’ consent to the settlement, and the ensuing non-settlement of the dispute and ‘unnecessary’ delays if they refused to settle. Further, it also aimed to ameliorate the Courts’ docket explosion. These objectives were sought to be achieved through decisions on merits by these informal forums.
Permanent LAs have been vested with jurisdiction over disputes pertaining to ‘public utility services’ as defined under the Act with a valuation of less than ₹1 crore. They have evolved to bear a significant stake in the resolution of disputes falling within their jurisdiction. At present, around 20-30% of such disputes in Ajmer,[1] and 40-50% of such cases in Udaipur,[2] are dealt with and decided by Permanent LAs instead of Civil Courts. It is hence crucial to critically examine their structure and functioning.
In various respects, the structure and functioning of Permanent LAs remains the same that of LAs. For example, references of a dispute to Permanent LAs can still be sought by either of the parties to the dispute, potentially without the consent of the other party. However, the mechanisms differ in two crucial respects. Firstly, the moment a party makes an application for reference of a dispute to the PLA mechanism, all the parties are precluded from approaching the judicial or quasi-judicial mechanisms to enforce their rights. Hence, even as the PLA mechanism is theoretically optional and in addition to the other legal remedies available to the parties, it might not be optional for either of them in practice. This is diametrically different from the procedure under the LA mechanism, wherein any of the parties is free to withdraw from the LA proceedings at any time and approach the Courts or get the case concerned referred back to them, as the case may be. Secondly, the Permanent LA may formulate the terms of a potential settlement for the parties’ consideration at any stage of the proceedings. If the parties do not settle, the Permanent LA may decide the dispute on merits, provided that it is not a criminal case.
This overall scheme of Permanent LA raises various issues pertaining to fairness. This piece will focus on one such issue i.e. the significant curtailment of party autonomy in the PLA mechanism, leading to adverse ramifications for procedural fairness for the parties.
Trading off Party Autonomy with Increased and Quicker Settlements: Problems and Implications for Fairness
A crucial problematic aspect of the Permanent LA mechanism is that it significantly scuttles party autonomy at the altar of securing higher settlements and quicker dispute resolution. It does so by diluting the role of parties’ consent in dispute resolution, through allowing the panel to decide the dispute on merits and curtailing the parties’ right to withdraw from the LA proceedings. This curtailment of autonomy is especially exacerbated for a party who consented to neither the referral of the case to Permanent LA nor the decision delivered, and was precluded from accessing other legal remedies from the moment the opposite party applied for the referral.
The curtailment of autonomy in permanent LAs is a diametrical shift from how LAs have statutorily been envisaged. However, in practice, even many LAs are witness to erosion of party autonomy through decision-making by panellists instead of the parties. The parties are often not able to strongly oppose such overreaches by the panel, by virtue of the power dynamics that exist between them because of the former often being less socio-economically privileged than the latter. Hence, the autonomy of parties in resolving their dispute, which is already highly curtailed in the case of LAs in practice, is now curtailed even theoretically in Permanent LAs.
This curtailment of party autonomy in the Permanent LA mechanism can have significant adverse implications from a fairness perspective, especially for underprivileged parties. This is because the procedure followed by Permanent LAs is heavily diluted as compared to Courts, where Indian procedural laws apply with their full rigour. The only procedural limitation on Permanent LAs is that their devised procedure must comply with “the principles of natural justice, objectivity, fair play, equity and other principles of justice”. This standard is highly vague, open-ended, fact-specific, and subjective. In the context of LAs (which follow a similar procedural standard), the Supreme Court has noted the stark divergence in the procedures adopted by different LAs. Many of these procedures do not conform to basic statutory tenets of an LA’s functioning.
In this context, the excessive dilution of procedural norms may lead to injustice and unfairness for the parties. The Indian judiciary has long been beset with the perception that procedural provisions are a ‘handmaiden of justice’ that can safely be bypassed if they appear in conflict with the parties’ substantive rights. However, at least some procedural rules are intrinsically linked to the parties’ rights and fairness, and cannot be diluted without prejudice to both. This is especially true of Indian procedural laws, which incorporate many aspects of the principles of natural justice as procedural safeguards. In the case of Permanent LAs, there is a blanket relaxation of these safeguards in the favour of a highly vague and subjective standard. This might result in unfair procedure being followed, with the resulting outcome being banyan tree justice at best.
For example, the CPC provides for multiple forms and instances of service of summons to the defendant before the suit is heard or decreed ex parte.[3] These include summons by the Court on the defendant’s address, service through publication in newspaper etc.[4] These provisions pertain to the principle of audi alteram partem, which mandates that the parties to the dispute be given a reasonable opportunity to present their case before the adjudicating authority. However, in some Permanent LAs, such strict requirements of summons are rarely followed. For example, in the Udaipur Permanent LA, where the panel believes that the respondent is maliciously avoiding the summons, it generally hears the petitioner ex parte, sometimes even if there has been only one summons.[5] This could potentially seriously prejudice the rights of the respondent where, for example, the petitioner had maliciously provided their wrong address. If the CPC were applicable, the defendant might have got the chance to gain knowledge of the case through other modes of summons, and hence secure a fair hearing; but the adoption of a summary procedure precludes such a possibility.
The injustice caused by an unfair procedure is compounded by the absence of a right to appeal against the award of the Permanent LA on merits. The only possible remedy against such procedural injustice is a writ petition in the High Court under Articles 226 and 227 of the Constitution, alleging the violation of the principles of natural justice. However, this remedy may not be accessible to many litigants, especially the socially and economically underprivileged, owing to the social and institutional constraints to litigation as outlined earlier.
In this context, in the case of an LA, the requirement of the parties’ consent for the continuation of the LA proceedings to forms a crucial safeguard against such injustice. This is because the parties may withdraw from the LA proceedings if they believe that the process or ultimate settlement reached has been unfair. Even in such circumstances, consent would an effective safeguard only where it is informed (i.e. parties have sufficient knowledge of their legal rights and entitlements) and free, both being aspects on which the LA mechanism has been found lacking. However, in altogether extirpating the requirement of consent from the Permanent LA mechanism, the LSAA amendments have removed even the limited protection that it provided to parties as a safeguard against procedural injustice.
Overall, the Permanent LA mechanism has deviated from the original goal of LAs i.e. that of democratising access to justice. Its adoption instead shows a proclivity towards an uncritical pursuit of higher settlement rates and faster case disposals.
Conclusion and Recommendations
The LA mechanism has traditionally been envisaged as a significant path towards democratising access to justice, by aiding parties in resolving disputes through conciliation with the minimum of costs, vexation, and delay. However, a study of the evolution of LAs shows that the focus of legislators and reformers has gradually shifted from the parties and their rights, towards ensuring higher settlement rates and quick disposals. This change in approach has culminated in the creation of the Permanent LA mechanism, a system that implicates grave concerns relating to party autonomy and consequently fairness.
Expedited and increased dispute resolution is indeed desirable in a country like India that has excessive judicial pendency and delays. Concomitantly, the LA system has traditionally given due weight to the significant values of party autonomy and fairness. To balance all these values and objectives, it is suggested that the power of Permanent LAs to issue decisions on merits be revoked. Concomitantly, to expedite dispute resolution and to meet the concern of unscrupulous parties using the Permanent LA mechanism as a dilatory tactic, the adoption of a modified version of the mechanism proposed by Justice A.S. Anand in the context of LAs could be considered.
As per his proposed mechanism, a provision could be introduced for Permanent LAs where the panel can decide a dispute on merits in exceptional cases. This would entail cases where the panel is satisfied that one of the parties is avoiding a settlement proposed by the other party without any reasonable or justified cause. Against such awards, appeals on merits must be allowed, to the same Court that would have had appellate jurisdiction in an identical case decided in the judicial system.
However, this post proposes certain additional safeguards that would help further the above mentioned values and objectives.
Firstly, there should be a greater statutory delineation of the permissible and impermissible procedural dilutions in the Permanent LA mechanism. In specific, the contours of the procedural rules that generally have a nexus with fairness and justice for the parties, and the extent of their dilution in their applicability to the Permanent LA mechanism, must be clearly specified.
Secondly, decisions on merits must be required to be accompanied by a speaking order delineating not only the final decision but also the evidentiary and legal reasoning therefor. The provisions of the CPC are instructive in this regard.[6]
Thirdly, decisions on merits must be made subject to an expedited mandatory review on merits by another panel, before the non-consenting party can raise an appeal.
All of these requirements would serve as checks against the abuse of the power by the Permanent LA panels. Further, safeguard 3 would potentially dis-incentivise panels from resorting to adjudication where not merited, since an excessive number of such decisions would consequently increase the caseloads of the Permanent LAs.
Fourthly, only the party that did not consent to the terms of the Permanent LA’s award must be granted the right to appeal. This would ensure that the consenting party does not cause undue costs, vexation, and delay by later reneging and re-opening the dispute.
Such a system could potentially help in appropriately balancing the above mentioned concerns and values. However, it would only be successful if adequate legal training is undertaken to ensure that the obsession on the part of Permanent LA panels with obtaining higher settlement rates and quick disposal is curbed. Further, such legal training must be designed to ensure that the panellists respect party autonomy and fairness, and only decide on merits where absolutely justified. Moreover, there is a need for systemic reforms to ensure that the parties are able to exercise free and informed consent. These could include awareness programmes for the parties approaching the LAs/ Permanent LAs with respect to the substantive and procedural rules implicated in their case. Further, the LSAA could incorporate an institutional role for legally trained social workers and NGOs in assisting and advising the parties with respect to their case, through adequate remuneration and other forms of support for recognised workers or organisations.
Ultimately, the Lok (people), and not increased or quicker settlements, must remain at the centre of Lok Adalats.
[1] Interview with Justice Gyarsi Lal Sharma, Chairman, Permanent Lok Adalat, Alwar, April 8, 2022. [2] Interview with Justice Ravi Prakash Sharma, Chairman, Permanent Lok Adalat, Udaipur, April 7, 2022. [3] See the Code of Civil Procedure, 1908, s 27 and Order V. [4] ibid. [5] Interview with Justice R P Sharma (n 2). [6] The Code of Civil Procedure, 1908, Order XX Rules 4 and 5.
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