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Lok adalats to decide on chque bounce cases

The law ministry is working on amendments to the Legal Services Authority Act that woudl see setting up of permanent lok adalats by banks to handle disputes relating to bouncing of cheques. Retired district judges or additional district judges will be appointed as chairpersons of such lok adalats in consultation with the high court concerned and the state government. A draft note has been circulated to departments concerned. By the time the new government is formed, the amendment bill may be ready for the cabinet to take a decision. The finance ministry had earlier proposed to amend the Negotiable Instruments Act that would restrict banks from dragging offenders of cheque bounce cases to courts. It is estimated that more than 30% of all the pending cases in courts across the country are either related to cheque bounce or traffic challans and once these amendments are passed by Parliament, the pendency of court cases are likely to come down substantially. Ruling of Lok Adalats is deemed to be decree of a civil court and considered binding on all parties concerned.

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