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Alternative Dispute resolution: An alternative to avoid lengthy court proceedings

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Alternative Dispute resolution: An alternative to avoid lengthy court proceedings

ABSTRACT

The Indian judiciary, which is one of the oldest in the world, faces a substantial backlog of cases that remain unresolved even with the fast track courts that have been established. ADR, or alternative dispute resolution, provides workable ways to lessen this load by using strategies including Lok Adalat, arbitration, mediation, negotiation, and conciliation. The article deals with each approach, which is subject to different rules, enables the settlement of disputes outside of formal court processes and offers advantages including speedier settlements, control over the process, and confidentiality. ADR does not, however, come without disadvantages, such as a potential lack of resolution and limited enforceability. Important legal frameworks in India facilitate ADR and improve its application. This article examines the importance, advantages, disadvantages, and many forms of alternative dispute resolution (ADR). It also highlights the government’s initiatives to establish India as a major global centre for arbitration and conflict settlement and provides case law examples of how ADR has changed in India. ADR offers equitable and effective outcomes; ultimately, the choice of ADR method depends on the particulars of the dispute and the preferences of the parties.

Key words: Alternative Dispute Resolution, Arbitration, Mediation, Conciliation, Lok Adalat.

INTRODUCTION

It is a well-known fact that the Indian judiciary is among the oldest in the world, but it is also getting less effective at handling cases that are still pending since Indian courts are overflowing with lengthy cases that have not been resolved. The problem is far from being resolved because there are still a large number of ongoing cases, despite the establishment of more than a thousand fast track courts that have already resolved millions of cases. All methods and procedures for resolving disputes that don’t involve the government are gathered under ADR. The most well-known alternative dispute resolution (ADR) techniques include transaction, negotiation, arbitration, conciliation, and mediation.  Although they are subject to various regulations, all alternative dispute resolution (ADR) techniques share the ability to help parties resolve their disputes in a way that is acceptable outside of formal legal or court processes. In contrast to mediation and conciliation, where a third party serves to encourage an acceptable arrangement between the parties, negotiation does not involve a third party intervening to help the parties reach an agreement. The third party, which might be one or more arbitrators, will be crucial to the arbitration process since it will produce an arbitration award that the parties must abide by. In contrast, no legally-binding conclusion is imposed by the third party in conciliation or mediation. In practice, the parties combine the use of these many ADRs, so if they are all different, they shouldn’t be compared and faced. In their contracts, for example, the parties may state that, in the event of a dispute, they will first attempt an amicable settlement (conciliation or mediation) and will only turn to a judicial method of settlement, which may include arbitration or recourse to the State justice system, if that approach fails.

SIGNIFICANCE

ADR uses a variety of strategies to address the backlog of cases in Indian courts, which is a big concern in India. The Indian judiciary receives scientifically established approaches from the Alternative Dispute Resolution mechanism, which lessens the workload on the courts. ADR offers several ways to settle disputes, including as negotiation, mediation, conciliation, arbitration, and lok Adalat. In this context, negotiation refers to the parties’ self-counseling to settle their disagreement, nevertheless, In India, negotiation is not legally recognized.  Articles 14 and 21, which address equality before the law and the right to life and personal liberty, respectively, are also the foundations of alternative dispute resolution (ADR). The preamble’s stated goals of social, economic, and political justice as well as upholding societal integrity are the driving forces of ADR.

REASONS FOR OPTING ADR

Through alternative dispute resolution (ADR), parties can agree to settle a dispute involving intellectual property that is protected in multiple jurisdictions in a single procedure, avoiding the cost and complexity of multi-jurisdictional litigation as well as the possibility of contradictory outcomes. Compared to court action, alternative dispute resolution (ADR) gives parties more influence over the resolution of their disagreement because it is a private process. The parties themselves may choose the best arbitrators for their dispute, in contrast to court proceedings. They can also decide on the venue, language, and applicable law for the proceedings. In court-based litigation, when familiarity with the relevant law and local processes can offer major strategic benefits, one party may benefit from a home court advantage. However, ADR can be neutral to the law, language, and institutional culture of the parties. The ADR process is confidential. As a result, the parties may decide to maintain the confidentiality of the proceedings and any conclusions. This frees them up to concentrate on the merits of the disagreement without worrying about how it will be received by the public. This may be especially crucial in cases involving trade secrets and commercial reputations. In contrast to court rulings, which are typically susceptible to challenge through one or more stages of litigation, arbitral awards are typically not appealable. In general, arbitral verdicts are recognized on par with domestic court judgements under the United Nations Convention for the Recognition and Enforcement of Foreign Arbitral verdicts of 1958, also referred to as the New York Convention, without merit review. This makes it much easier to enforce prizes internationally.

DRAWBACKS OF ADR

There is not always a resolution through the alternate resolution procedure.
This implies that even after spending time and resources attempting to settle the disagreement outside of court, the parties may still need to go through with a trial by jury and litigation in order to pursue arbitration and other kinds of conflict resolution. An appeal is not possible against a neutral arbitration’s ruling, with a few notable exceptions like fraud. Conversely, a court’s rulings are typically appealable for a number of reasons. ADR awards cannot be enforced as if they were court judgements because there is no equivalent to section 66 of the Arbitration Act 1996, which states that an award made by the tribunal in accordance with an arbitration agreement may be enforced in the same manner as a judgement or order of the court to the same effect. The awards are not as readily enforceable, though. The majority of conflicts resolved through arbitrations involve money. They are unable to give injunctions because they are unable to impose instructions requiring one party to do something or refrain from doing something. Due to the lack of a disclosure requirement in arbitration that exists in litigation, there is a chance that parties will settle a dispute without fully understanding the circumstances, which could result in an incorrect conclusion. However, the majority of businessmen held the opinion that reaching a resolution quickly is preferable to squandering time and resources on a disagreement in order to reach the right conclusion. When a client requires an injunction, when there is no issue to be resolved, or when the client needs a legal decision made, alternative dispute resolution is not appropriate.

MODES OF ADR

Arbitration

The arbitration process cannot proceed if there is not a valid arbitration agreement in effect prior to a dispute developing. Parties submit their disagreement to one or more arbitrators in this way of resolving disputes.  Parties must abide by the arbitrator’s ruling, which is referred to as the “Award.” The goal of arbitration is to resolve disputes fairly and quickly, out of court, without incurring further costs or delays. Any party to a contract that has an arbitration clause may invoke it on their own behalf or through an authorised agent, in which case the dispute will be submitted to arbitration under the terms of the arbitration agreement. An arbitration clause in this context refers to a clause that specifies the procedures, language, number of arbitrators, and seat or authorised location of the arbitration.

According to Section 8 of the Arbitration and Conciliation Act of 1996, a party may petition the court to have the matter referred to an arbitration tribunal in accordance with the agreement if the other party disregards the arbitral agreement and takes the suit to civil court rather than arbitration, but not after the first statement has been submitted. The dispute will be referred to arbitration if the courts are satisfied with the application, which must contain a certified copy of the arbitration agreement.

Mediation

Through the alternative dispute resolution process of mediation, two or more disputants might work with a third, impartial person to help them reach a resolution. A third party serves as a mediator in this simple and straightforward party-centered negotiation process, employing effective communication and negotiating strategies to help parties settle their differences amicably. The parties have complete control over this process. The mediator’s role is limited to assisting the parties in resolving their disagreement. The mediator does not impose his opinions or decide what constitutes a just settlement.

Conciliation

Although less formal in nature, conciliation is nonetheless a type of arbitration. It is the process of helping the parties to a disagreement reach a peaceful conclusion through the use of a conciliator who meets with each party separately to resolve the conflict. Conciliators meet separately in order to improve communication, reduce tension between the parties, and interpret the situation in order to facilitate a negotiated conclusion. Prior consent is not required, and it cannot be imposed onto a party that does not choose to participate in conciliation. That is how it differs from arbitration.

Negotiation

It is the most regularly employed alternate method of resolving disputes. A non-binding process whereby the parties start talks with each other without the help of a third party in an effort to reach a mutually agreeable settlement. Businesses, non-profits, government agencies, court cases, international relations, and private affairs like marriage, divorce, parenthood, and daily living all involve negotiation.

Lok Adalat

The Lok Adalat, often known as the “People’s Court,” is chaired by a member of the legal profession, social activists, or a serving or retired judge. In order to exercise this authority, the National Legal Service Authority (NALSA) and other Legal Services Institutions regularly hold Lok Adalats. Lok Adalat may be consulted over any matter that is still pending in a regular court or any disagreement that hasn’t been presented before a court of law. The process is quick since there are no court costs and certain procedures are followed. The court money that was initially paid in the court when the petition was filed is also returned to the parties in the event that a matter that is pending in court or referred to the Lok Adalat is settled afterwards.

PIVOTAL CASE LAWS

Case name- Renusagar Power Co Ltd vs. General Electric

According to the Supreme Court, the goal of this Act was to expedite and advance international trade by establishing an arbitration process for the prompt resolution of trade-related disputes. It was declared that unless the parties specifically granted him such authority, an arbitrator generally lacked the capacity to clothe himself with the authority to decide the matter within his own jurisdiction. The Court further decided that the court, not the arbitrator, should make the decision regarding the contract’s validity under Section 33. The entire process would lack jurisdiction if there had been no arbitration clause in place when the arbitrators began their duties.

Case name- Bhatia International Vs Bulk Trading

The Supreme Court of India adopted Section 9 to support arbitrations seated outside of India after interpreting Part I of the Act to extend to arbitrations held outside of India. The aforementioned Act makes no mention of its provisions not applying to international commercial arbitrations held in nations that have not ratified conventions. The Act’s Part II is exclusively applicable to arbitrations conducted in nations that have signed conventions.  The court decided that Part I’s rules would automatically apply in any case where the arbitration took place in India. Nonetheless, unless the Parties have expressly or implicitly rejected all or any of Part I’s provisions, the requirements of Part I shall apply in cases of international commercial arbitrations conducted outside of India. In that instance, the Parties’ selected laws or regulations would take precedence. Any part of Part I that is expressly prohibited will not be applicable. The aggrieved parties in foreign arbitrations are now able to get interim remedy in India.

CONCLUSION

The establishment of arbitration rules, which have undergone substantial evolution over time, is where ADR techniques got their start. Over time, more alternative dispute resolution (ADR) techniques made their way to the Indian Parliament, which was astute enough to incorporate these novel approaches to conflict resolution. For example, the Micro, Small and Medium Enterprises Development Act of 2006 and the Commercial Courts Act of 2015 make sure that these processes are used case-by-case in particular industries. In order to position India as a leading worldwide hub for arbitration and other kinds of conflict resolution, the Indian government is currently undertaking further measures to establish alternative dispute resolution (ADR) procedures. Effective substitutes for traditional litigation are Alternative Dispute Resolution (ADR) techniques such arbitration, neutral review, mediation, and settlement conferences. They provide parties the ability to settle conflicts quickly, amicably, and possibly at a considerable financial savings. Selecting the best ADR strategy will eventually support equitable and successful conflict resolution and depend on the particulars of the dispute as well as the preferences of the parties.

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Written by- Shreyasi Ghatak

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Supreme Court Affirms Jurisdictional Scope in Contractual Disputes: The Municipal Committee Katra Case

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Case Title: MUNICIPAL COMMITTEE KATRA & ORS. Vs. ASHWANI KUMAR

Case No.: CIVIL APPEAL NO(S). 14970-71 OF 2017

Dated on: May 09, 2024

Coram: J. B.R. GAVAI, J. SANDEEP MEHTA

Facts:

The case involves a dispute between the Municipal Committee Katra and Ashwani Kumar regarding a contract for supplying mules and mazdoors for transporting pilgrims to the Mata Vaishno Devi shrine. Ashwani Kumar, the second highest bidder, became the highest bidder after the original highest bidder declined the contract. The contract required 40% of the bid amount to be deposited within 24 hours, along with bank guarantees and post-dated cheques for the remaining amount. Kumar sought relaxation from this clause, but the Municipal authorities denied it, prompting him to file a civil suit. The District Judge granted a temporary injunction in Kumar’s favor, directing the Municipal Committee to issue the work order, which was later upheld by the High Court. Kumar began work on 10th May 2010, but later claimed losses for the 33 days prior to this date, filing a writ petition seeking compensation. The High Court directed the Municipal Committee to consider Kumar’s claim.

Issues:

  • Whether the High Court in exercise of writ jurisdiction, was entitled to entertain a dispute which was purely civil in nature filed for claiming monetary relief/damages arising from fallout of contractual obligations.

Legal Provisions:

  • Clause-8 of the Notice Inviting Tender (NIT):

It states that the successful highest bidder, shall have to deposit 40% of the offered amount at the time of provisional acceptance of the offer by the committee immediately but not later than 24 hours from the time of acceptance.

Contentions of the Appellants:

The appellants, Municipal Committee Katra, contended that the High Court improperly exercised its writ jurisdiction to entertain a dispute purely of a civil nature involving monetary relief arising from contractual obligations. They argued that the respondent’s request to relax the bank guarantee condition in the tender was unjustified. They also maintained that the respondent had already been provided relief through a temporary injunction and subsequent orders which allowed him to execute the contract, thus making his claim for additional compensation for the delayed start period unwarranted.

Contentions of the Respondent:

The respondent, Ashwani Kumar, contended that the provision in the tender requiring him to provide a bank guarantee for the remaining contract amount was unjust and arbitrary. Additionally, he argued that the delay in commencing the contract, which started from May 10 instead of April 1 as originally intended, resulted in a loss of revenue for 33 days. Consequently, he sought compensation amounting to Rs. 71,06,276, representing the purported loss incurred due to the curtailed contract period.

Court’s Analysis & Judgement:

The Hon’ble SC analysed whether the High Court had the jurisdiction to entertain a dispute of a purely civil nature, especially one concerning contractual obligations and claims for monetary relief. It examined the terms of the tender, particularly Clause 8, which specified the requirements for depositing the bid amount and providing a bank guarantee. The Court considered the respondent’s contentions regarding the alleged arbitrariness of Clause 8 and the loss suffered due to the delayed start of the contract.

Eventually, the Hon’ble SC upheld the decision of the High Court to entertain the dispute, emphasizing the importance of ensuring fairness and reasonableness in contractual agreements, especially those involving public authorities. It directed the appellants to consider the respondent’s claim for compensation within a specified timeframe.

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Judgement Reviewed By- Shramana Sengupta

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Delhi High Court Upholds Settlement Agreement at Reduced Interest Rate, Safeguarding Appellant’s Legal Rights

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Case Name: Anil Sharma & Ors v. Genesis Finance Co. Ltd. & Ors 

Case No.: RFA(OS)(COMM) 39/2019 

Dated: May 08, 2024 

Quorum: Justice Vibhu Bakhru and Justice Tara Vitasta Ganju 

 

FACTS OF THE CASE: 

In this intra-court appeal, the appellants have challenged a judgement and decree dated 27.03.2019 (referred to as the challenged order) issued by the learned Single Judge in CS(COMM) 307/2016, which is captioned Genesis Finance Company Ltd. v. Anil Sharma & Others. 

By the contested order, the learned single judge granted respondent no. 1’s application under Order XIIIA of the Code of Civil Procedure and issued a preliminary decree in accordance with Order XXXIV Rule 4 of the CPC, stating that the plaintiff was entitled to recover ₹2,03,00,000/-as a joint and several recovery from the appellants and respondent nos. 2 and 3 (defendants in the suit), together with interest at the rate of 18% annually from the date of the lawsuit’s institution until its realisation and 24% annually from the Settlement Deed dated 20.01.2014 until the date of the suit’s institution, or 31.03.2016.  

Furthermore, the educated Single Judge had also ordered costs to be measured at ₹2.5 lacs. The learned Single Judge gave the respondent nos. 2 and 3 and the appellants six months to pay the plaintiff’s debt; if they fail to do so, the plaintiff may seek a final decree for the sale of the mortgaged properties, or a portion of them, to recoup the outstanding amounts.  

The defendant had filed the aforementioned suit in order to recover ₹4,15,14,023.76/- (Rupees Four Crores Fifteen lakhs Fourteen thousand Twenty-Three and Seventy-Six paise only) as well as pendente lite and future interest at the rate of 36% per annum (reducing). The plaintiff also requested a decree for the sale of mortgaged properties as stated in Paragraph 4 of the complaint. 

The appellants have based their defence on the claim that they were misled into signing a Loan Agreement with the plaintiff on May 19, 2011 (henceforth referred to as the Loan Agreement) on the false impression that the loan came with a simple interest rate of 17.67% annually.  

On the other hand, the loan was structured with an interest rate of 17.67% (flat), which, when calculated using the decreasing balance approach, amounted to about 30.08%. This assumption was made when the documentation was created. 

The experienced single judge concluded that the appellants had no chance of winning their defence. Based on the appellants’ admission of the payment schedule that was a component of the loan agreement, the aforementioned conclusion was reached. Furthermore, there was no disagreement about the parties’ agreement to settle their differences over the outstanding liability and interest that was due on it when they signed the Settlement Agreement. 

 

LEGAL PROVISIONS: 

  • Section 138 of the Negotiable Instruments Act, 1881. Penalises the dishonouring of any cheque written for “any debt or other liability” that has been partially or fully paid. Furthermore, there is coextensive accountability between the major debtor and the guarantor. So, in accordance with section 138, N.I., the guarantor cannot avoid liability. 

 

CONTENTIONS OF THE APPELLANTS: 

According to the appellants’ learned counsel, they were under the false impression that the equivalent monthly installment for loan facility repayment was ₹11,68,735/-. Nevertheless, they had paid back ₹2,61,98,620/- against a loan of ₹2,75,00,000/-, or 22.4 equal monthly installments. The plaintiff argued that the EMIs were based on a 30.08% annual interest rate, but that the plaintiff had deceitfully convinced appellant nos. 1 through 3 to agree to pay interest at the rate of 17.67%. 

According to his submission, if the annual percentage rate for the EMIs was 17.67%, the corresponding monthly installment would be ₹9,89,644. He presented evidence that the appellants signed the Settlement Agreement at the time the mother of appellants nos. 1 and 3 was brought into the intensive care unit. The appellants acknowledged that ₹2,03,00,000 was still owed as of January 20, 2014, but they had signed the Settlement Agreement in error because they had put their trust in the plaintiff.  

Additionally, he argued that the plaintiff had taken advantage of the appellants’ pressing need for money to force them to sign on the dotted line. He argued that the Settlement Agreement was unenforceable because it was signed while the appellants were extremely agitated and not in a normal mental state due to the mother of appellants nos. 1 and 3 being critically ill and admitted to the intensive care unit due to multiple organ failure. 

The court determined that the parties in question in the debt Agreement, the defendants committed to repaying the debt over the course of 36 monthly installments. The fixed amount for the monthly installment was ₹11,68,735/-. Consequently, there could be no misinterpretation of the payable interest. 

 

COURT’S ANALYSIS AND JUDGMENT: 

According to the court’s ruling, interest is computed over the whole loan duration. Thus, in this instance, the appellant would be required to pay a total of 53.01% in interest over the course of three years, or 17.67% annual interest. The appellants would be required to return ₹4,20,74,460/-, with the aforementioned interest being payable on the whole ₹2,75,00,000/-loan principal. Because the repayment schedule was attached to the loan paperwork and stated that the total amount above was due, the appellants could not have been misled about the method used to calculate the interest.  

The court determined that the plaintiff had filed complaints under Section 138 of the NI Act, which were pending in the Dwarka courts, because the appellants’ checks had been returned unpaid. Therefore, there could not have been any doubt at that point regarding the appellants’ knowledge of the conditions of the Loan Agreement. The parties to mediation were referred to by the court, and as a result, the appellants entered into a Settlement Agreement that was included in the mediation proceedings. 

The appellants had complete knowledge of the plaintiff’s allegation, the court further noted. It is evidently an afterthought to argue that the appellants were not in a proper state of mind since their mother was in the intensive care unit (ICU) at the relevant period. The appellants did not make any such claim in their written declaration. Furthermore unsubstantial is the claim that the appellants were not given access to the whole Settlement Agreement. Moreover, the written declaration that the defendants filed makes no mention of this kind. As said earlier, there is no disagreement regarding the implementation of the Settlement Agreement.  

Additionally, take note of the fact that even though the Settlement Agreement is clear and stipulates that interest will be paid at a rate of 36% annually on a decreasing balance basis, the learned Single Judge had lowered the pre-suit interest rate to 24% annually. The plaintiff has agreed to the impugned order’s reduction in interest rates from 36% to 24% annually, even though it is not discussed in it. We see no need to investigate this further as a result. 

 

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Judgment reviewed by Riddhi S Bhora. 

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If a party fails to comply with the deadline of the agreement it is not entitled to the extension of limitations – High court of MP

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Case Title: RAMESH KUMAR MANSANI, ENGINEERS & CONTRACTORS Versus MADHYA PRADESH RURAL ROAD DEVELOPMENT AUTHORITY and others

Case No: ARBITRATION REVISION No. 47 of 2022

Decided on:16th April, 2024

Quorum: HON’BLE SHRI JUSTICE SHEEL NAGU & HON’BLE SHRI JUSTICE VINAY SARAF

Facts of the case

The facts of the present case show that the termination occurred on June 25, 2004. While the petitioner filed a claim against termination on September 16, 2004, well past the 30-day window specified in condition 29 for bringing up a disagreement with the Authority’s Chief Executive Officer. As a result, the petitioner is not eligible to benefit from the extended three-year statute of limitations granted by Section 7-B (2-A) since they did not follow the schedule stipulated in clause 29 of the agreement.

Petitioner’s Contentions

The petitioner disputed the validity of an award made by the M.P. Arbitration Tribunal, claiming that the reference petition was rejected because it failed to comply with the agreement’s mandatory elements within the allotted time . The reference petition was dismissed by the Tribunal after it was determined that the petitioner had not used the internal remedy within the allotted time . The argument that Clause 29’s time limit is not required was denied, highlighting the significance of timely submissions to avoid evidence loss . The petitioner was not entitled to the extended three-year statute of limitations since they did not follow the deadline stipulated in Clause 29 of the agreement . The Tribunal denied the revision petition after finding no anomalies in the award.

Respondent’s Contentions

Rejecting the idea that the time restriction in Clause 29 is not required, the respondent contended that timely claims are essential to prevent loss of evidence . They stressed that in order to invoke the jurisdiction of the Tribunal, a reference petition must first be filed with the authority in accordance with the conditions of the work contract . Furthermore, the respondent argued that the contractor was still required to adhere to the administrative authority’s timeframe in accordance with the internal remedy outlined in Clause 29 , despite the additional three-year limitation period.

Court Analysis and Judgement

The ruling underlined how crucial it is to abide by the conditions of the work contract before utilizing the Tribunal’s jurisdiction and how the disagreement must be submitted to the final authority first . It was emphasized that an aggrieved party may file a complaint with the Tribunal within three years after the date of the cause of action in situations where the works contract does not contain a dispute resolution clause such as Clause 29 . The ruling further said that a party may not be eligible to receive the extended three-year statute of limitations if they do not comply with the deadline stipulated in Clause 29 of the agreement .

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Judgement Analysis Written by – K.Immey Grace

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BMC should have been cautious relying on the agreement- SC

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Case Title: THE STATE OF MADHYA PRADESH VERSUS SATISH JAIN (DEAD) BY LRS & ORS

Case No: 6884 OF 2012

Decided on:18th April, 2024

Quorum: Honourable Justice VIKRAM NATH

Facts of the case

A civil claim was filed by Satish Jain, the son of Dayanand Jain, naming one Rama, the son of Parasram, as defendant No. 1 a mandatory injunction, and a permanent injunction through Collector, Bhopal, as respondent No. 2. Defendant No. 1 has, however, been enjoying calm and continuous adverse possession over the suit land for the past 50–60 years, and as a result, he has perfected his rights through adverse possession and has turned the land into his own. Additionally, it was claimed that defendant No. 1 had given the plaintiff all of his rights, title, and interest over the suit land. The plaintiff installed wired fencing and began to enjoy possession of the suit land. The plaint also alleges that defendant No. 1 learned that some State agents and workers had visited the suit land and attempted to remove the fencing, and that he was likely to transfer the aforementioned land once more in favor of the third party. Under these conditions, the plaintiff was obliged to file a lawsuit seeking a declaration, a mandatory injunction, and a permanent injunction. BMC filed an application under Section 89 of the CPC, requesting that the plaintiff be ordered to pay Rs. 30,00,000 (Rupees Thirty Lakhs only) in accordance with the terms of the agreement of July 30, 1991, against the value of the granted land. It was also mentioned that BMC is prepared to fulfill its responsibilities should the entire sum be deposited. The objections made it clear that BMC did not have the authority or business to deal with the land without the State’s express approval or agreement, and that the State of Madhya Pradesh still retains title of the site.

Contentions

The plaintiff has not received any such declaration. Since the ex-parte decree was overturned, the plaintiff had no opportunity to take further action regarding the agreement because no rights had become clear to the parties. The plaintiff’s ex-parte decree of declaration and injunction served as the foundation for that arrangement. This is assuming that the agreement ever had any validity in the first place. There seems to be evidence of BMC and the plaintiff working together in some way. The entire foundation for entering into the agreement was thrown aside, therefore regardless of whether the agreement contained a provision for the appointment of an arbitrator, none of the parties could have relied on the agreement itself. BMC could not have handled it or treated it as being in the plaintiff’s ownership or possession, even if the State had given it to them to build a bus station. BMC would be required to use the aforementioned land for the reason it was given as an allottee of the State. It was legally required to take the necessary actions to remove the plaintiff’s possession, which was completely unauthorized and unlawful.

Court Analysis and Judgement

The agreement itself would not have any legal validity, even between the parties, after both orders were overturned and the lawsuit moved forward from the point where the appellant-state filed its written declaration. Because the plaintiff’s entitlement established by the ex-parte order was extinguished, BMC should have been cautious to avoid depending on the agreement going forward. By reversing the award, the Trial Court was justified in granting the application. The High Court made an error in grave error in failing to take into account pertinent factors and relying solely on the appellant-state’s declaration made in front of the trial court that the state had no interest because it had given BMC the land for a bus stand and, as a result, should be removed from the list of parties as defendant no. 2. In any event, unless the State has already disposed of or withdrew all of the applications, they are all still pending before the Trial Court. Considering the aforementioned, the appeal is justified and granted as a result. The High Court’s contested order is overturned. The lawsuit will be heard by the Trial Court, which will make a merits decision based on the evidence .

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Judgement Analysis Written by – K.Immey Grace

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