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Whether court should permit parties to adduce evidence if there is allegation that mediation settlement was obtained by force?


Crl. M.C. No. 2498/2014,

Decided On: 09.02.2015

Manoj Chandak
Tour Lovers Tourism (India) Pvt. Ltd. and Ors.

Hon’ble Judges/Coram: Sunil Gaur, J.

1. In the above captioned two petitions, petitioner has filed complaints under Section 138 of The Negotiable Instruments Act, 1881, which is said to have been mediated upon and according to petitioner, respondent- accused has failed to honour the mediated settlement of 26th July, 2013 and came up with an application for reconsideration after three months of mediated settlement and the said application has been erroneously allowed by trial court and parties have been again referred to mediation.

2. Since quashing of impugned order of 25th April, 2014 is sought in the above-captioned two petitions on identical grounds, so these petitions were heard together and are being disposed of by this common order. At the hearing, learned counsel for petitioner had placed reliance decisions in Naveen Kumar v. Khilya Devi & Anr. MANU/DE/3630/2011 : (2011) 183 DLT 381, Naresh Chand Jain & Anr. v. K.M. Tayal MANU/DE/2014/2012 : (2012) 3 ILR Delhi 133, decision of a Division Bench of this Court in FA(OS) No. 83 of 2007, Bhai Sunder Das Sardar Singh Pvt. Ltd. v. Bhai Balbir Singh & Anr., rendered on 9th July, 2013 and Afcons Infrastructure Limited & Anr. v. Cherian Varkey Construction Company Pvt. Ltd. MANU/SC/0525/2010 : (2010) 8 SCC 24 to contend that mediated settlement is to be honoured and is not to be defeated in the manner as has been done by trial court vide impugned order.

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3. Learned counsel for respondents had submitted that although signatures of authorized representative of respondent on the mediated settlement are not denied but he had no instructions to agree to the terms of the settlement as reflected in the mediated settlement. It was also submitted on behalf of respondents that signatures of authorized representative of respondent were obtained forcibly and so aforesaid settlement is not binding upon the parties and the parties have been rightly referred to mediation again vide impugned order. Thus, it was submitted that there is no illegality in the impugned order and the decisions cited are distinguishable.

4. Upon hearing and on perusal of the impugned order, material on record and the decisions cited, I find that mediated settlement is to be treated as executable decree. Such a view is being taken in view of dictum of Apex Court in K.N. Govindan Kutty Menon v. C.D. Shaji MANU/SC/1412/2011 : (2012) 2 SCC 51, which is as under:-

“From the above discussion, the following propositions emerge:

(1) In view of the unambiguous language of Section 21 of the Act, every award of the Lok Adalat shall be deemed to be a decree of a civil court and as such it is executable by that court.

(2) The Act does not make out any such distinction between the reference made by a civil court and a criminal court.

(3) There is no restriction on the power of the Lok Adalat to pass an award based on the compromise arrived at between the parties in respect of cases referred to by various courts (both civil and criminal), tribunals, Family Court, Rent Control Court, Consumer Redressal Forum, Motor Accidents Claims Tribunal and other forums of similar nature.

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(4) Even if a matter is referred by a criminal court under Section 138 of the Negotiable Instruments Act, 1881 and by virtue of the deeming provisions, the award passed by the Lok Adalat based on a compromise has to be treated as a decree capable of execution by a civil court”.

5. Since, question of fact are being raised regarding voluntariness of the mediated settlement, therefore, it would be appropriate that an opportunity is granted by trial court to respondents to lead evidence to show that the mediated settlement was not a voluntary one.

6. In view of aforesaid, impugned order of 25th July, 2014 is hereby quashed and petitioner-complainant’s application for acting upon mediated settlement be revived for hearing by the trial court, who shall decide it after giving an opportunity to respondents to lead evidence on the petitioner’s application.

7. Let needful be done by the trial court expeditiously and in any case within 16 weeks from the date of hearing, so fixed on the application.

8. The petitions and applications accordingly disposed of.

9. Trial court be apprised of this order forthwith.

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