# BAR COUNCIL OF INDIA v. UNION OF INDIA

- **Citation:** [2012] 6 S.C.R. 1094
- **Court:** Supreme Court of India
- **Decided:** 2012-08-03
- **Bench:** R.M. Lodha, Anil R. Dave
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/bar-council-of-india-v-union-of-india-28156
- **Pages:** 32

## Headnote

Legal Services Authorities Act, 1987 - Chapter VI-A (ss.
22-A to 22-E) [as inserted by Legal Services Authorities
C (Amendment) Act, 2002] - Pre-litigation conciliation and
settlement - Establishment of Permanent Lok Ada/at - For
settlement of disputes in matters of public utility services -
Constitutional validity of -
Held: Chapter VJ-A is
constitutionally valid - It is not violative of Articles 14 and 2t
o of the Constitution nor contrary to rule of law, fairness and
even-handed justice -
It is an alternative institutional
mechanism for settlement of disputes concerning public utility
services -
Legislature has the power to set up such
mechanism - It is in addition to and not in derogation of for a
E provided under special statutes - It is not a constitutional right
to have dispute adjudicated by means of court only - Not
making CPC and evidence Act applicable to the Lok Ada/at
does not make its justice delivery ineffective as the Ada/at has
to follow the principles of na_tural justice - Absence of right to
F appeal also does not make the provisions unconstitutional -
The independence of the Lok Adalats have a/so not been
compromised - Since the challenge to the provisions has
already been decided by Supreme Court in an earlier case
on merits and dismissed, deciding the same issues again is
G against public policy - Constitution of India, 1950 - Articles
39-A, 14, 21 and 141 - Precedent.
H
Appeal - Held: There is no inherent right of appeal -
Appeal is a creature of statute - Non providing of appeal in
-
1094
BAR COUNCIL OF INDIA v. UNION OF INDIA
1095
a statute by itself may not render that statute unconstitutional
A
- Legal Services Authorities Act, 1987.
The petitioner challenged the vires of Chapter VIA
comprising of ~s. 22-A to 22-E of the Legal Services
Authorities Act, 1987, as inserted by the Legal Services
8
Authorities (Amendment) Act, 2002. The provisions were
challenged on the ground that the same were arbitrary
per se, violative of Article 14 of the Constitution of India
and were contrary to the rule of law as they denied fair,
unbiased and even-handed justice to all.
c
The respondent-State interalia contended that the
issues raised in the present writ petition sin~e already
been decided in S.N. Pandey v. Union of India (Writ Petition
(Civil) No. 543/2002 decided by Supreme Court on
28.10.2002), the present petition deserved to be D
dismissed on this ground alone.
Dismissing the petition, the Court
HELD: 1.1. 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 39E
F
A. Pursuant to these objectives, the 1987 Act was
enacted by the Parliament to constitute legal services G
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 H
1096
SUPREME COURT REPORTS
[2012] 6 S.C.R.
A the legal system promotes justice on the basis of equal
opportunity. 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
B 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. [Paras 10 and
11] [1107-E-G; 1108-A; 1109-F-G]
c
1.2. Ch

## Text

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A
B
[2012] 6 S.C.R. 1094
BAR COUNCIL OF INDIA
v.
UNION OF INDIA
(Writ Petition (Civil ) No. 666 of 2002)
AUGUST 3, 2012
[R.M. LODHA AND ANIL R. DAVE, JJ.)
Legal Services Authorities Act, 1987 - Chapter VI-A (ss.
22-A to 22-E) [as inserted by Legal Services Authorities
C (Amendment) Act, 2002] - Pre-litigation conciliation and
settlement - Establishment of Permanent Lok Ada/at - For
settlement of disputes in matters of public utility services -
Constitutional validity of -
Held: Chapter VJ-A is
constitutionally valid - It is not violative of Articles 14 and 2t
o of the Constitution nor contrary to rule of law, fairness and
even-handed justice -
It is an alternative institutional
mechanism for settlement of disputes concerning public utility
services -
Legislature has the power to set up such
mechanism - It is in addition to and not in derogation of for a
E provided under special statutes - It is not a constitutional right
to have dispute adjudicated by means of court only - Not
making CPC and evidence Act applicable to the Lok Ada/at
does not make its justice delivery ineffective as the Ada/at has
to follow the principles of na_tural justice - Absence of right to
F appeal also does not make the provisions unconstitutional -
The independence of the Lok Adalats have a/so not been
compromised - Since the challenge to the provisions has
already been decided by Supreme Court in an earlier case
on merits and dismissed, deciding the same issues again is
G against public policy - Constitution of India, 1950 - Articles
39-A, 14, 21 and 141 - Precedent.
H
Appeal - Held: There is no inherent right of appeal -
Appeal is a creature of statute - Non providing of appeal in
-
1094
BAR COUNCIL OF INDIA v. UNION OF INDIA
1095
a statute by itself may not render that statute unconstitutional
A
- Legal Services Authorities Act, 1987.
The petitioner challenged the vires of Chapter VIA
comprising of ~s. 22-A to 22-E of the Legal Services
Authorities Act, 1987, as inserted by the Legal Services
8
Authorities (Amendment) Act, 2002. The provisions were
challenged on the ground that the same were arbitrary
per se, violative of Article 14 of the Constitution of India
and were contrary to the rule of law as they denied fair,
unbiased and even-handed justice to all.
c
The respondent-State interalia contended that the
issues raised in the present writ petition sin~e already
been decided in S.N. Pandey v. Union of India (Writ Petition
(Civil) No. 543/2002 decided by Supreme Court on
28.10.2002), the present petition deserved to be D
dismissed on this ground alone.
Dismissing the petition, the Court
HELD: 1.1. 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 39E
F
A. Pursuant to these objectives, the 1987 Act was
enacted by the Parliament to constitute legal services G
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 H
1096
SUPREME COURT REPORTS
[2012] 6 S.C.R.
A the legal system promotes justice on the basis of equal
opportunity. 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
B 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. [Paras 10 and
11] [1107-E-G; 1108-A; 1109-F-G]
c
1.2. Chapter VI-A inserted by the 2002 Amendment
Act in 1987 Act, as its title suggests, provides for prelitigation. conciliation and settlement procedure. The
disputes relating to public utility service like transport
service for carriage of passengers or goods by air, road
D or water or postal, telegraph or telephone ~ervice 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
E 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
F 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
G mechanism as early as may be possible. With large
populatio!J 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
H procedures in the judicial courts are not conducive for
BAR COUNCIL OF INDIA v. UNION OF INDIA
1097
adjudication of disputes relating to public utility service.
A
[Para 18] [1114-H; 1115-A-E]
1.3. 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
8
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 C
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. [Para 19] [1115-F-H]
1.4. 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 pu'blic utility
services, the Parliament has intervened and conferred
power of adjudication upon the Permanent Lok Adalat.
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(S), cannot be said to be unconstitutional and
irrational. [Para 22] [1116-G-H; 1117-A-B]
1.5. 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
D
E
F
G
is essential is that it must be a creature of statute and
should adjudicate the dispute between the parties before
H
1098
SUPREME COURT REPORTS
(2012] 6 S.C.R.
A 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,
B 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
c does not relate to any offence. [Para 22) [1117-C-E]
1.6. 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
D 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
E 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
F arrangements are made by the Parliament with an
adjudicatory power, such institutional mechanisms or
arrangements cannot be faulted on the ground of
arbitrariness or irrationality. [Para 20) [1116-A-D]
G
1.7. It is not correct to say 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
H
BAR COUNCIL OF INDIA v. UNION OF INDIA
1099
dispute adjudicated by a civil court or a 'forum created
A
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. The Permanent Lok Adalats are in addition to
and not in derogation of fora provided under Special
B
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. [Para 28] [1120-E-H]
1.8. By not making applicable the Code of Civil
C
Procedure and the statutory provisions of the 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 D
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. [Para 29] [1121-B-C]
1.9. In view of the composition of Central Authority
and the State Authority, 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
E
F
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
G
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.
[Para 30] [1122-A-D]
H
1100
SUPREME COURT REPORTS
[2012] 6 S.C.R.
A
1.10. 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
B 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
c composition becomes violative of principles of fairness
and justice or is contrary to Articles 14 and 21 of the
Constitution of India. [Para 31) [1122-E-G]
1.11. It is true that the award made by the Permanent
Lok Adalat under 1987 Act has to be by majority of the
D 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
E
justice. [Para 32) [1122-G-H]
1.12. 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 22F 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,
does
not
render
the
impugned
prov1s1ons
G 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
H
BAR COUNCIL OF INDIA v. UNION OF INDIA
1101
earliest and is not prolonged unnecessarily. Secondly,
A
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. [Para 33] [1123B
A-D]
The Premier Automobiles Ltd. v. Kamlekar Shantaram
Wadke ofBombay and Ors. (1976) (1) SCC 496: 1976 (1)
SCR 427; Fair Air Engineers Pvt. Ltd. and Anr. v. N.K. Modi
C
(1996) 6 sec 385: 1996 (4) Suppl. SCR 820; Skypak
Couriers Ltd. v. Tata Chemicals Ltd. (2000) 5 SCC 294: 2000
(1) Suppl. SCR 324; Trans Mediterranean Airways v.
Universal Exports and Anr. (2011) 10 SCC 316: 2011 (14)
SCR 47; National Seeds Corporation Limited v. M.
Madhusudhan Reddy and Anr. (2012) 2 SCC 506; Secretary,
D
Thirumurugan Cooperative Agricultural Credit Society v. M.
Lalitha (Dead) through LRs. and Ors. (2004) 1 SCC 305:
2003 (6) Suppl. SCR 659; Kishore Lal v. Chairman,
Employees' State Insurance Corpn. (2007) 4 SCC 579: 2007
(6) SCR 139; Mis. Harinagar Sugar Mills Ltd. v. Shyam
E
Sundar Jhunjhunwala and Ors. 1962 (2) SCR 339; Associated
Cement Companies Ltd. v. P. N.Sharma and Anr. (1965) 2
SCR 366; Kihoto Hol/ohan v. Zachi/lhu and Ors.1992 Supp
(2) SCC 651: 1992 (1) SCR 686; Union of India v. R. Gandhi,
President, Madras Bar Association 2010 (2010) 11 SCC 1:
F
2010 (6) SCR 857 - referred to.
2. The challenge to the validity of the impugned
provisions came up before this Court in S.N. Pandey
Case*. Although the disposal of writ petition in S.N.
G
Pandey was in limine and the order is brief, but the Court
disposed of the same on merits. Therefore, it cannot be
said that the order passed therein cannot be construed
as a binding precedent; and that the said decision does
not declare any law under Article 141 of the Constitution.
It is against public policy and well defined principles of H
1102
SUPREME COURT REPORTS
[2012] 6 S.C.R.
A judicial discretion to entertain or hear petitions relating
to same subject matter where the matter was heard and
dismissed on an earlier occasion. [Paras 34, 35 and 36]
[1123-F; 1124-F-H; 1125-C]
8
B. Prabhakar Rao and Ors. v. State of Andhra Pradesh
and Ors.1985(Supp) SCC 432; Union of India and Ors. v.
Jaipal Singh (2004) 1 SCC 121: 2003 (5) Sup.pl. SCR 115
- relied on.
*S.N. Pandey v. Union of India Judgement in Writ
C Petition (Civil) No. 543 of 2002 passed by Supreme Court
on 22.10.2002; B. Sha ma Rao v. Union Territory of
Pondicherry AIR 1967 SC 1480: 1967 SCR 650; Municipal
Corporation of Delhi v. Gumam Kaur (1989) 1 SCC 101: 1988
(2) Suppl. SCR 929; State of Punjab v. Baldev Singh (1999)
D 6 SCC 172: 1999 (3) SCR 977 - referred to.
Case Law Reference:
1976 (1) SCR 427
Referred to
Para 7
E
1996 (4) Suppl. SCR 820 Referred to
Para 7
2000 (1) Suppl. SCR 324 Referred to
Para 7
2011 (14) SCR 47
Referred to
Para 7
2012 (2) sec 506
Referred to
Para 7
F
2003 (6) Suppl. SCR 659 Referred to
Para 7
2007 (6) SCR 139
Referred to
Para 7
1985 (Supp) sec 432
Relied on
Para 9
G
2003 (5) Suppl. SCR 115 Relied on
Para 9
1967 SCR 650
Referred to
Para 9
1988 (2) Suppl. SCR 929 Referred to
Para 9
H
1999 (3) SCR 977
Referred to
Para 9
BAR COUNCIL OF INDIA v. UNION OF INDIA
1103
1962 (2) SCR 339
1965 (2) SCR 366
1992 (1) SCR 686
2010 (6) SCR 857
Referred to
Referred to
Referred to
Referred to
Para 23
A
Para 24
Para 25
Para 26
CIVIL ORIGINAL JURISDICTION : Writ Petition (Civil) No.
666 of 2002.
Under Article 32 of the Constitution of India
B
Manoj Goel, Shuvodeep Roy, Wajeeh Shafiq, Gopal C
Verma, Shashank Kathuria (for Brij Bhusan) for the Petitioner.
T.S. Doabia, Rashmi Malhotra, Sunita Sharma (for B.V.
Balramdas) for the Respondent.
D
The Judgment of the Court was delivered by
R.M. LODHA, J. 1. Bar Council of India by means ofthjs
writ petition under Article 32 of the Constitution of India has
raised challenge to the vires of Sections 22-A; 22-B, 22-C, 22D and 22-E of the Legal Services Authorities Act, 1987 (for
E
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
F
Permanent Lok Adalat" and a new Chapter VI-A entitled "Prelitigation 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
G
constituting Permanent Lok Adalats".
3. The challenge is principally ort 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
H
1104
SUPREME COURT REPORTS
[2012] 6 S.C.R.
A 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
8
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
C 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 preempting an aggrieved consumer from going to the consumer
fora or availing other judicial process for redressal of his
D 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
E of the Civil Procedure Code or the Evidence Act. Section 22C(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
F challenge arbitrary and irrational.
5. It has been submitted on behalf of the petitioner that
award of the Permanent Lok Ada lat 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
G 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
H
BAR COUNCIL OF INDIA v. UNION OF INDIA
1105
[R.M. LODHA, J.]
citizen and, therefore, even absence of one right of appeal
A
. 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
B
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
C
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
D
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).
E
In this regard, the provisions contained in three specialized
F
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. Kam/ekar
Shantaram Wadke of Bombay and Others1, in the written
G
arguments it has been submittedthat 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
1.
(1976) (1) sec 496
H
1106
SUPREME COURT REPORTS
[2012] 6 S.C.R.
A 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
B 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. Modi2, Skypak Couriers Ltd. v. Tata Chemicals
c Ltd. 3, Trans Mediterranean Airways v. Universal Exports and
anothef' and National Seeds Corporation Limited v. M.
Madhusudhan Reddy and another5 . National Seeds
Corporation Limited5 was also pressed into service in support
of the submission that consumer protection laws were enacted
0
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 b.arred even in cases where some disputes can be
E 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 Others6 and Kishore Lal v. Chairman, Employees' State
Insurance Corpn7. have been relied upon.
F
8. Mr. T.S. Doabia, learned senior counsel for the Union
G
H
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;
2.
(1996) 6 sec 385.
3.
c2000) 5 sec 294.
4.
c2011) 10 sec 316.
5.
c2012) 2 sec 506.
6.
c2004) 1 sec 305.
7.
c2007) 4 sec 579.
BAR COUNCIL OF INDIA v. UNION OF INDIA
1107
[R.M. LODHA, J.]
decided on 28.10.2002) and the writ petition deserves to be
A
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
B
(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 8. Prabhakar Rao and others v. State of Andhra Pradesh c
and others8, Union of India and others v. Jaipal Singh9 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
D
Court in· 8. Shama Rao v. Union Territory of Pondicherry10,
Municipal Corporation of Delhi v. Gurnam Kaur11 and State
of Punjab v. 8aldev Singh12•
10. Article 39-A came to be inserted in the Constitution
E
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
F
opportunities for securing justice are not denied to any citizen
by reason of economic or other disabilities. Equal justiGe to all
and free legal aid are hallmark of Article 39-A. Pursuant to these
objectives, the 1987 Act was enacted by the Parliament t.o
constitute legal services authorities to provide free and
G
8.
1985 {Supp) sec 432.
9.
(2004) 1 sec 121.
10. AIR 1967 SC 1480.
11. (1989) 1 sec 101.
12. (1999) 6 sec 112.
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SUPREME COURT REPORTS
[2012] 6 S.C.R.
A 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 Ada lats to secure that the operation of the legal
system promotes justice on a basis of equal opportunity. The
B statement of objects and reasons that led to enactment of 1987
Act reads as follows :
c
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"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
BAR COUNCIL OF INDIA v. UNION OF INDIA
1109
[R.M. LODHA, J.]
State Governments. Power has been also given to the
A
National Committee and the State Committees to
supervise the effective implementation of legal aid
schemes.
3.
For some time now, Lok Adalats are being
8
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
C
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
D
support would not only reduce the burden of arrears of work
in regular Courts, but would also take justice to the doorsteps 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
E
F
any compromise or settlement (n 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:
G
"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
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A
B
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SUPREME COURT REPORTS
[2012] 6 S.C.R.
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 seniices.
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
BAR COUNCIL OF INDIA v. UNION OF INDIA
1111
[R.M. LODHA, J.]
District Judge and two other persons having adequate
A
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;
B
(iii) the pecuniary jurisdiction of the Permanent Lok
C
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;
D
(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."
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12. With the above objectives, 2002 Amendment Act was
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[2012] 6 S.C.R.
A 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
8 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,
C 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
D VI-A, such service on declaration is also included in the
definition of 'public utility service' under Section 22-A(b).
14. T,he establishment of Permanent Lok Adalat is done
under Sectioh 22-B. The Central Authority and every State
E 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
F 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
,,G 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.
H
BAR COUNCIL OF INDIA v. UNION OF INDIA
1113
[R.M. LODHA, J.]
15. Section 22-C provides for the procedure for raising
A
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 jurisdiption to deal with any matter
B
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
nqt have jurisdiction in a matter where the value of the property
in dispute exceeds ten lakh rupees. The Central Government, c
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
D
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
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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
F
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
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any party to the application is given to the other party. On
completion of the above procedure, the Permanent Lok Adalat
proceeds with conciliati.on proceedings between the parties to
the application under sub-section (4) of S\3ction 22-C. During
conduct of the conciliation proceeaings under sub-section (4)
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[2012) 6 S.C.R.
A 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
B the application and to comply with the direction of the
Permanent Lok Adalat to produce evidence and other related
documents pefore it.
16.2. On satisfaction that there is likelihood of settlement
in the proceedings, the Permanent Lok Adalat may formulate
C 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
D 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 22E 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.