[2025:RJ-JP:44044] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR S.B. Civil Writ Petition No. 14919/2025 Branch Manager, Bank Of Baroda, Branch, Gandhi Chowk, Jhunjhunu. ----Petitioner Versus Nekiram S/o Gulabsingh, Resident Of Village Khajpur Naya Via Islampur, District Jhunjhunu. ----Respondent For Petitioner(s) : Mr. Ram Naresh Vijay, Adv. with Mr. Priyank Sanwariya, Adv. For Respondent(s) : Mr. Abhishek Bhardwaj, Adv. with Mr. Aayush Malik, Adv. HON'BLE MR. JUSTICE ASHUTOSH KUMAR Order 03/11/2025 1. This petition has been filed against the award passed by learned Permanent Lok Adalat, Jhunjhunu (Rajasthan) (hereinafter referred to as learned 'Permanent Lok Adalat') in Complaint No. 14/2024 titled as "Nekiram S/o Gulabsingh Vs. Branch Manager, Bank Of Baroda" dated 30.07.2025, by which learned Permanent Lok Adalat has decided the application in favour of the respondent directing the petitioner to pay Rs.1,00,000/- with interest @ 6% and also Rs.20,000/- as compensation for mental agony and legal expenses. 2. Learned counsel for the petitioner submits that learned Permanent Lok Adalat has passed the award ex-parte without following the procedure laid down under Section 22-C of the Legal Services Authorities Act, 1987 (hereinafter referred to as [2025:RJ-JP:44044] (2 of 7) [CW-14919/2025] the 'Act of 1987'). Learned counsel further submits that the petitioner failed to appear before learned Permanent Lok Adalat, however, learned Permanent Lok Adalat without following the procedure to hold the conciliation proceedings, directly passed the ex-parte impugned award dated 30.07.2025 against the petitioner. Learned counsel for the petitioner prays that since the aforesaid order was passed without following the procedure laid down under Section 22-C of the Act of 1987, therefore, the award passed by learned Permanent Lok Adalat be set aside. 3. In support of his contentions, learned counsel has drawn the attention of this Court towards the judgment passed by Hon'ble The Supreme Court in case of Canara Bank Vs. G.S. Jayarama reported in (2022) 7 SCC 776. 4. Learned counsel for the respondent submits that since the petitioner failed to appear before learned Permanent Lok Adalat, the necessity to draw any conciliation proceedings would be a futile exercise and as such, the award passed by learned Permanent Lok Adalat does not suffer from any illegality, therefore, it is prayed that the petition be dismissed. 5. Heard learned counsel for the parties and perused the material available on record. 6. The procedure for disposal of the complaint before learned Permanent Lok Adalat has been given under Section 22-C of the Act of 1987, which reads as under:- "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: [2025:RJ-JP:44044] (3 of 7) [CW-14919/2025] 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 of ten 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 application; (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 circumstances of the dispute. [2025:RJ-JP:44044] (4 of 7) [CW-14919/2025] (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 the every party to the application to cooperate 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 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. (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." 7. The petitioner failed to appear before the learned Permanent Lok Adalat even after notices were issued against him, therefore, the learned Permanent Lok Adalat decided the matter ex-parte, without following the procedure with regard to conciliation. 8. Hon’ble the Supreme Court in the case of Canara Bank Vs. G.S. Jayarama reported in (2022) 7 SCC 776 observed as under:- "36. The appellant's argument, however, is that if the opposite party does not appear before the Permanent Lok Adalat, it can dispense with the conciliation proceedings and straightaway adjudicate the dispute [2025:RJ-JP:44044] (5 of 7) [CW-14919/2025] under Section 22-C(8). We are unable to accept this submission. Even if the opposite party does not appear, the Permanent Lok Adalat is still bound to follow the step-by- step procedure laid down by Section 22-C. Under Section 22-C(3), it would require the party before it to file their submissions and documents, and make the best efforts to communicate them to the opposite party for their response. If it is satisfied that no response is forthcoming from the absent opposite party, the Permanent Lok Adalat shall still attempt to settle the dispute through settlement under Section 22-C(4). It is important to remember that Section 22-C(5) imposes a duty upon the Permanent Lok Adalat to be independent and impartial in attempting to amicably settle the dispute, while Section 22-C(6) imposes a duty upon the party present before the Permanent Lok Adalat to cooperate in good faith and assist the Permanent Lok Adalat. Thereafter, the Permanent Lok Adalat, based on the materials before it, shall propose terms of settlement and communicate them to both parties, regardless of whether they participated in the proceedings. If the party present before the Permanent Lok Adalat does not agree or if the absent party does not respond in a sufficient period of time, only then can the Permanent Lok Adalat adjudicate the dispute on its merits under Section 22-C(8). Keeping in mind the principles enshrined in Section 22-D, the Permanent Lok Adalat shall once again notify the absent party of its decision to adjudicate the dispute on its merits, in case it wishes to join the proceedings at that stage. 37. Section 22-C(8) is amply clear that it only comes into effect once an agreement under Section 22-C(7) has failed. The corollary of this is that the proposed terms of settlement under Section 22-C(7), and the conciliation proceedings preceding it, are mandatory. If Permanent Lok Adalats are allowed to bypass this step just because a party is absent, it would be tantamount to deciding disputes on their merit ex parte and issuing awards which will be final, binding and will be deemed to be decrees of civil courts. This was simply not the intention of Parliament when it introduced the LSA Amendment Act. Its main goal was still the conciliation and settlement of disputes in relation to public [2025:RJ-JP:44044] (6 of 7) [CW-14919/2025] utilities, with a decision on merits always being the last resort. Therefore, we hold that conciliation proceedings under Section 22-C of the LSA Act are mandatory in nature. 44. At the same time, the Division Bench in its impugned judgment also noted that the Permanent Lok Adalat failed to follow the mandatory conciliation proceedings in the present case. This observation is correct since the award of the Permanent Lok Adalat does not indicate any attempt made by it to propose terms of settlement to the parties and their rejection. It states that once the respondent and his guarantor did not appear, it adjudicated the dispute on merits in favour of the respondent. For the reasons mentioned earlier in this judgment, the Permanent Lok Adalat could not have done so. Therefore, on this point only, we uphold the final judgment of the Division Bench setting aside the award dated 19- 11-2014 of the Permanent Lok Adalat. 45. Consequently, we hold that the observations of the Division Bench in the impugned judgment in respect of the adjudicatory powers of the Permanent Lok Adalats were incorrect, while upholding its ultimate conclusion since the Permanent Lok Adalat failed to follow the mandatory conciliation proceedings in the present case. We make it clear that we have not made any observations on the merits of the dispute between the parties, and all rights and contentions of the parties are kept open. In the circumstances of the case, there shall be no order as to costs. Pending application(s), if any, stand disposed of." 9. It is evidently clear that before adjudicating the matter, learned Permanent Lok Adalat failed to issue notice to the petitioner, intimating it that the matter was to be decided on merits. Thus, there is clear violation of procedure prescribed under Section 22-C of the Act of 1987, as well as observations made by the Hon'ble Supreme Court in case of Canara Bank (supra). Therefore, this Court deems it fit to allow the petition. [2025:RJ-JP:44044] (7 of 7) [CW-14919/2025] 10. In that view of the matter, the petition is allowed and the award dated 30.07.2025 passed by learned Permanent Lok Adalat, Jhunjhunu (Rajasthan) is quashed and set aside. 11. Learned Permanent Lok Adalat is directed to decide the matter afresh after giving proper opportunity of hearing to both the parties, as per the procedure prescribed under Section 22-C of Act of 1987 and the judgment passed by Hon'ble Supreme Court in case of Canara Bank (supra), without being prejudiced by the observation made in this order. 12. Both the parties are directed to remain present before the learned Permanent Lok Adalat, Jhunjhunu on 28.11.2025. 13. Stay application and other pending applications, if any, also stand disposed of. (ASHUTOSH KUMAR),J Mohita /10