Equitas Small Finance Bank Ltd. vs. Mrs Nirmala Bai Shanthilal & Ors.
Background
The petitioner bank's own counsel had told both the trial court and, later, the National Lok Adalat that the bank had received full and final settlement from the loan defaulters and that a cheque-bounce complaint under the Negotiable Instruments Act could be treated as compounded. Over a year later, the bank tried to get the case revived, claiming its counsel had misunderstood instructions and no settlement or payment had actually occurred.
Decision Breakdown
The Court found the bank's own nominated counsel had made the settlement statement on two separate occasions before two different forums, that the bank waited thirteen months before disputing it, never sought any clarification from or took action against that counsel, and continued to be represented by the same lawyer thereafter. Holding that a litigant cannot resile from voluntary statements made by its own counsel, an officer of the court, after such statements have already resulted in court orders, the Court dismissed the writ petition as devoid of merit.
Lesson Learnt
A party is generally bound by representations its own lawyer makes to a court, and cannot later disown them as a "misunderstanding", especially after long, unexplained delay and without ever confronting that lawyer about the alleged error.