Bank refused to obey the order of Lok Adalat

This legal guidance explains the remedies available when a bank fails to comply with a compromise order passed by the Lok Adalat despite receiving the settled amount. It discusses enforcement of the award, execution proceedings, contempt-related remedies, and the legal course available against arbitrary action of the bank.

by Shivendra Pratap Singh | Mar 9, 2025 | Civil Matters

Bank refused to obey the order of Lok Adalat which was passed upon the compromise. There was a dispute regarding the payment of credit card outstanding. The matter was resolved and I deposited the amount fixed by the bank after deliberation. Then the court has forwarded our case to the Mega Lok Adalat. After passing of the award the bank has sent a notice to me for readjustment of the outstanding amount. When I refused to pay that additional amount the bank lodged a FIR against me by stating that I had concealed that amount of loan to the bank. 

Asked from: Uttar Pradesh

Once the loan has been closed and the award has been passed by the Lok Adalat with the consent of both parties, any criminal proceedings initiated by the bank become non-est. There is no justification for initiating criminal proceedings against you after the final settlement of the dispute.

As per Section 21 of the Legal Services Authorities Act, 1987, the award of Lok Adalat is treated as a decree. In K. N. Govindakutti (2012) 2 SCC 51, the Supreme Court held that every award of Lok Adalat is deemed to be a decree of a civil court and is, therefore, executable by the civil court.

You should file an execution petition in the civil court to enforce the award of Lok Adalat. If the bank has any objections to the award, it may raise them in the execution proceedings. After filing the execution petition, you should also file a writ petition in the High Court to quash the FIR.

Once both parties have amicably settled their dispute, no further proceedings can be initiated on the same cause of action. This is purely a civil dispute, and hence, no criminal proceedings can be instituted against the parties involved. The High Court shall quash the FIR on the above basis.

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Tags: FIR | Lok Adalat

Shivendra Pratap Singh

Shivendra Pratap Singh

Advocate

Advocate Shivendra, practicing law since 2005, specializes in criminal and matrimonial cases, extensive litigatin experience before the High Court, Sessions court & Family Court. He established kanoonirai.com in 2014 to provide dependable and pragmatic legal support. Over the years, he has successfully assisted thousands of clients, making the platform a trusted resource for criminal and matrimonial dispute resolution in India.

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