Quick Summary: Chengalpet Steel Rolling Mill opposed a decision made by the Lok Adalat and a paper showing the sale of property to someone else. The High Court canceled these decisions, questioning if the process was done correctly.
Chengalpet Steel Rolling Mill had used its property as security for a loan from the State Bank of India and failed to pay back the loan. The bank took the matter to court, and the court decided the property could be taken over.
The State Bank of India started the process to take over the property, but a third person, Mr. B. Mahaveer, paid off the full amount. Because of this payment, the process was stopped.
"The execution petition was closed by order dated 25.09.1997."
Years later, Mr. Mahaveer complained to the Lok Adalat. The Lok Adalat recorded an agreement between him and the bank and gave him a paper showing he owned the property.
"The Lok Adalat passed an award dated 02.09.2016."
Justice G.K. Ilanthiraiyan pointed out that the Lok Adalat is supposed to help people agree, not make decisions. The paper showing Mr. Mahaveer owned the property was given without a public sale, which was not the right way to do it.
"The award passed by the Lok Adalat itself cannot be sustained and it is non-est in the eye of law."
The court agreed with Chengalpet Steel Rolling Mill, canceling the Lok Adalat's decision and the paper showing the sale of the property. Mr. Mahaveer was told he could go to the proper court process to try and get his money back.
"The third respondent is at liberty to approach the Execution Court for appropriate relief."
This case shows how important it is to follow the right steps in legal agreements, especially when it involves property and money matters.
