Code of Civil Procedure

Introduction

In this case the court held that the courts of law are meant for imparting justice between the parties. One who comes to the court, must come with clean hands.

Facts

• The appellant was the owner of 18 acres of land, 39 cents of Village Kancharapalem, District Visakhapatnam.
• Visakhapatnam Port Trust (Port Trust) wanted to acquire land for public purposes i.e. for the construction of quarters for employees.
• Chairman of the Port Trust sent a requisition letter to the District Collector for acquiring the land.
• Advance possession of the land taken over by the Estate Manager of the Port Trust by private negotiations.
• Port Trust requested state authority to take appropriate proceedings for acquisition of land under the Land Acquisition Act, 1894.
• The land acquisition was approved by Port trust as well as by government of India.
• On 17^th February 1976 the Ceiling Act came into force in the State of Andhra Pradesh. It, inter alia, covered the Visakhapatnam Urban Agglomeration.
• The contention of the appellants was that possession of land had already been handed over to Port Trust Authorities even before the Act came into force and the provisions of the Ceiling Act, therefore, would not apply to such land.
• The Special Officer and Competent Authority, Urban Land Ceiling declared that the landowners ’non-surplus land holders’.
• The statement of appellants disclosed the Chief Engineer of Port Trust in his reply to the query by the Land Acquisition Officer said that actual and physical possession of the land was not taken by Port Trust as the tenant did not vacate possession of the land.
• The landowners filed a writ petition before the High Court praying therein that the High Court may direct the State Authorities to complete proceedings under the Land Acquisition Act and pass an award.
• The High Court directed the authorities to complete Land Acquisition Proceedings and pass the award within three months.
• Thereafter a recall application was filed by the state authorities and stated that fraud was committed by the landowners and material facts were suppressed by them. It was alleged that possession of land was never handed over to Port Trust Authorities.
• The High Court allowed the recall petitions by setting aside the common judgment passed in earlier writ petition. And held that the case was of fraud and by suppressing material facts.
• The appellants challenged the said order of High Court before the Supreme Court.

Issues Involved

• Whether a judgment or an order obtained through a Court by fraudulent means or by suppression of material fact binding or not?

Observations

• The Supreme Court stated that it is the settled proposition of law that a judgment, decree or order obtained by playing fraud on the Court, Tribunal or Authority is a nullity and non est in the eye of law.
• The principle of finality of litigation cannot be stretched to the extent of absurdity that it can be utilized as an engine of oppression by dishonest and fraudulent litigants.
• The judiciary in India possesses inherent power, specially under Section 151 Code of Civil Procedure, 1908 (CPC) to recall its judgment or order if it is obtained by Fraud on Court.
• A litigant, who approaches the court, is bound to produce all the documents executed by him which are relevant to the litigation. If he withholds a vital document to gain advantage on the other side, then he would be guilty of fraud in the court and on the opposite party.
• All the facts prima facie showing commission of fraud and initiation of criminal proceedings, etc. if the High Court was pleased to recall the earlier order by issuing directions to the authorities to pass an appropriate order afresh in accordance with law, it cannot be said that there is miscarriage of justice which calls for interference in exercise of discretionary and equitable jurisdiction of this Court. We, therefore, hold that this is not a fit case which calls for our intervention under Article 136 of the Constitution of India, 1950. We, therefore, decline to do so.
• Supreme Court quote the statement of Chief Justice Edward Coke: "Fraud avoids all judicial acts, ecclesiastical or temporal".
• A judgment, decree or order based on fraud by the first Court or by the final Court has to be treated as nullity by every Court, superior or inferior. It can be challenged in any Court, at any time, in appeal, revision, writ or even in collateral proceedings.

Conclusion

Fraud is thus an extrinsic collateral act which vitiates all judicial acts, whether in rem or in personam.