This article is written by Samriddha Ray of 3rd Year of St Xavier’s University, Kolkata, an intern under Legal Vidhiya
Abstract
The development of alternative dispute resolution mechanisms in India reflects a constitutional mandate to provide quick and inexpensive access to justice. Lok Adalats, or “People’s Courts”, are an integral part of this framework, created under the Legal Services Authorities Act, 1987. With the growing number of consumer grievances in India, the traditional litigation system is increasingly burdened. Lok Adalats serve as an effective platform to resolve consumer disputes efficiently through compromise and mutual consent. This article analyses the evolution, functioning, and impact of Lok Adalats in addressing consumer grievances, supported by judicial precedents and suggestions for reform.
Introduction
India’s judicial system is often criticized for delays, mounting pendency, and complex procedural technicalities. In the field of consumer law, while dedicated consumer forums have been established under the Consumer Protection Act, 2019, these too face significant backlog and procedural constraints. Lok Adalats offer an alternative pathway for justice, enabling dispute resolution through dialogue and consensus. Their relevance in consumer law has grown considerably, particularly for low-stake, non-criminal, and settlement-friendly disputes.
The Legal Concept of Lok Adalat
The term “Lok Adalat” translates to “People’s Court.” Rooted in ancient Indian practices of informal community justice, its formal incarnation was introduced to supplement the overburdened judiciary.
The Legal Services Authorities Act, 1987 institutionalized Lok Adalats as an alternative forum for dispute resolution. Chapter VI of the Act (Sections 19 to 22) governs their establishment and powers. Lok Adalats are empowered to handle:
• Pending cases before courts,
• Pre-litigation disputes,
• Civil disputes, including matrimonial and property matters,
• Compoundable criminal offences, and
• Disputes involving public utility services under Permanent Lok Adalats.
The awards of Lok Adalats are deemed to be civil court decrees and are final, binding, and non-appealable.
3. The Rise of Consumer Disputes in India
With liberalisation, digitisation, and an expanding consumer market, there has been a surge in consumer grievances in India. Common categories of disputes include:
• Defective goods or services,
• Unfair trade practices,
• Medical negligence,
• Insurance claim rejections,
• Real estate delays or fraud, and
• Telecommunication and e-commerce grievances.
Although the [1]Consumer Protection Act, 2019 provides a three-tier redressal mechanism — District, State, and National Commissions — the sheer volume of cases results in prolonged litigation, legal expenses, and procedural delays.
This makes Lok Adalats an attractive alternative for consumers seeking quick redressal through mutual agreement.
4. Statutory Link Between Lok Adalats and Consumer Law
Though the [2]Legal Services Authorities Act and the Consumer Protection Act operate independently, they are interlinked by the principle of access to justice. Section 19 of the 1987 Act allows Legal Services Authorities to organise Lok Adalats for any case pending before any court or for disputes that are likely to be filed.
Moreover, Section 37 of the Consumer Protection Act, 2019 encourages mediation in suitable cases. Since Lok Adalats use conciliation as their primary tool, they fit seamlessly into this objective.
Many State Legal Services Authorities (SLSAs) now conduct Consumer Lok Adalats regularly, where consumer cases are settled on the basis of compromise, especially with banks, telecom, insurance, and electricity departments.
Types of Lok Adalats Addressing Consumer Disputes
a. Regular Lok Adalats
Organised at regular intervals by District or State Legal Services Authorities. Consumer cases pending in District Forums are often referred here with the parties’ consent.
b. National Lok Adalats
Conducted quarterly across India on a single day under the guidance of the National Legal Services Authority (NALSA). These Lok Adalats have disposed of millions of consumers and civil disputes.
c. Permanent Lok Adalats (PLAs)
Established under Section 22B for disputes relating to public utility services (e.g., transport, electricity, water, postal services). Many consumer grievances, especially billing disputes, are settled here.
d. Mobile Lok Adalats
These are specially designed to reach remote areas, offering redressal to consumers who may not have easy access to legal forums.
e. [3]Procedure for Settlement of Consumer Disputes in Lok Adalat
1. Filing of Dispute or Referral: A consumer can directly approach the Legal Services Authority or request the referral of a pending matter.
2. Consent of Both Parties: Settlement is possible only if both parties agree to participate.
3. Panel Composition: Each Lok Adalat bench consists of a judicial officer (often retired) and legal experts or social workers.
4. Hearing and Conciliation: Parties present their version. The panel suggests solutions and encourages compromise.
5. Award: If a settlement is reached, the Lok Adalat passes an award binding on both parties under Section 21.
6. No Court Fee: No court fee is charged. If already paid, it is refunded.
7. Non-Adjudicatory Role: The Lok Adalat cannot decide the case on merits; it can only facilitate a mutually agreed solution.
Key Judicial Pronouncements
(i) [4]State of Punjab v. Jalour Singh (2008) 2 SCC 660
The Supreme Court clarified that Lok Adalats have no jurisdiction to decide matters on merits if the parties do not agree to settle. Their function is strictly conciliatory.
(ii) [5]B.P. Moideen Sevamandir v. A.M. Kutty Hassan (2009) 2 SCC 198
The Court held that an award passed by Lok Adalat is final and enforceable as a decree of civil court. No appeal lies unless obtained by fraud or misrepresentation.
(iii)[6] Canara Bank v. S.K. Khasim (2010)
The Andhra Pradesh High Court recognised that bank-related consumer disputes, including loan recovery and service issues, can be effectively resolved in Lok Adalats.
Limitations and Concerns
Despite their benefits, Lok Adalats are not free from criticism:
• Consent-Based Limitation: If either party refuses to compromise, no decision can be rendered.
• Non-Adjudicatory Role: Cannot decide complicated issues of law or fraud.
• Lack of Legal Expertise: In some cases, panels may lack deep knowledge of consumer law.
• Corporates’ Reluctance: Many businesses prefer formal hearings and avoid ADR.
• Enforcement Challenges: Despite legal status, implementation of awards may face practical delays.
[7]Lok Adalat Data and Impact
• [8]NALSA Reports (2023): Over 1.89 crore cases (including pre-litigation and pending matters) were settled in National Lok Adalat held on 13 May 2023.
• Consumer Disputes Settled: Thousands of disputes involving banks, insurance companies, electricity departments, and telecom operators were resolved amicably.
• Banking Sector: Public Sector Banks have resolved significant volumes of non-performing loans (NPLs) and customer grievances through Lok Adalats.
These statistics reflect growing institutional reliance on Lok Adalats for consumer redressal.
Suggestions and Reforms
a. Statutory Amendment for Referrals
A structured framework within the Consumer Protection Act for mandatory pre-litigation referral of certain categories of disputes (e.g., telecom, insurance) can boost settlements.
b. Digital Lok Adalats
Expanding e-Lok Adalats for online consumer grievance resolution, especially post-COVID, can increase accessibility.
c. Public Awareness Campaigns
Use mass media, government schemes, and educational modules to make consumers aware of the option of Lok Adalats.
d. Expert Panels
Panels should include consumer law experts or sector-specific members for technical issues (e.g., medical, e-commerce).
e. Monitoring and Evaluation
A centralised system to track compliance with awards and identify repeat defaulters can enhance accountability.
Comparative International Insight
• United States: [9]The Federal Trade Commission encourages ADR for consumer disputes. Mediation and arbitration are commonly used.
• [10]European Union: Offers Online Dispute Resolution (ODR) platforms for cross-border consumer disputes.
• China: Promotes “People’s Mediation Committees” for informal resolution, similar to Lok Adalats.
India’s Lok Adalat model, if integrated with technology and sector-specific frameworks, can serve as a global example.
Conclusion
The role of Lok Adalats in consumer disputes exemplifies a transformative shift in the Indian legal system — from adversarial litigation to participatory justice. While statutory consumer commissions remain the primary forum, Lok Adalats supplement their role by offering a platform for consensual, timely, and low-cost resolutions. Their success, however, depends on structured institutional support, sectoral adaptation, and increased awareness among stakeholders.
If effectively harnessed, Lok Adalats can become a cornerstone of India’s consumer justice system — delivering on the constitutional promise of justice, not merely in law, but in practice.
References
- The Legal Services Authorities Act, No. 39 of 1987, India Code (1987). §§ 19–22B (Statutory basis of Lok Adalats).
- The Consumer Protection Act, No. 35 of 2019, § 37, India Code (2019) (For reference to mediation and redressal commissions under the 2019 Act).
- State of Punjab v. Jalour Singh, (2008) 2 S.C.C. 660 (India).
- B.P. Moideen Sevamandir v. A.M. Kutty Hassan, (2009) 2 S.C.C. 198 (India).
- Canara Bank v. S.K. Khasim, (2010) (Unreported, A.P. High Ct.) (India).
- The Constitution of India, art. 39A.
(Directive principle ensuring free legal aid and access to justice)
- National Legal Services Authority (NALSA), National Lok Adalat Disposal Reports – 13 May 2023, available at https://nalsa.gov.in/ (last visited July 9, 2025).
(Cites statistics of over 1.89 crore cases disposed of in one day.)
- Department of Consumer Affairs, Ministry of Consumer Affairs, Government of India, https://consumeraffairs.nic.in (last visited July 9, 2025).
(Use for general consumer law framework and Lok Adalat policies)
- European Commission, Online Dispute Resolution Platform, https://ec.europa.eu/consumers/odr (last visited July 9, 2025).
- Federal Trade Commission, Consumer Dispute Resolution, https://www.ftc.gov (last visited July 9, 2025).
[1] The Consumer Protection Act, No. 35 of 2019, § 37, India Code (2019) (For reference to mediation and redressal commissions under the 2019 Act).
[2] The Legal Services Authorities Act, No. 39 of 1987, India Code (1987). §§ 19–22B (Statutory basis of Lok Adalats).
[3] Department of Consumer Affairs, Ministry of Consumer Affairs, Government of India, https://consumeraffairs.nic.in (last visited July 9, 2025).
(Use for general consumer law framework and Lok Adalat policies)
[4] State of Punjab v. Jalour Singh, (2008) 2 S.C.C. 660 (India).
[5] B.P. Moideen Sevamandir v. A.M. Kutty Hassan, (2009) 2 S.C.C. 198 (India).
[6] Canara Bank v. S.K. Khasim, (2010) (Unreported, A.P. High Ct.) (India).
[7] The Constitution of India, art. 39A.
(Directive principle ensuring free legal aid and access to justice).
[8] National Legal Services Authority (NALSA), National Lok Adalat Disposal Reports – 13 May 2023, available at https://nalsa.gov.in/ (last visited July 9, 2025).
(Cites statistics of over 1.89 crore cases disposed of in one day.)
[9] Federal Trade Commission, Consumer Dispute Resolution, https://www.ftc.gov (last visited July 9, 2025).
[10] European Commission, Online Dispute Resolution Platform, https://ec.europa.eu/consumers/odr (last visited July 9, 2025).
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