March 21, 2006. DELHI DEVELOPMENT AUTHORITY & OTHERS

20.       Moreover, it is well settled that fraud vitiates all proceedings. The issue of misrepresentation and fraud has been considered by the Courts time and again.  A Constitution Bench of the Supreme Court in Pratap Singh v. State of Punjab, AIR 1964 SC 72, placed reliance upon the judgment in Lazarus Estates Ltd v. Beasley, 1956 All ER 341, wherein it has been observed:

No judgment of a Court, no order of a Minister, can be allowed to stand if it has been obtained by fraud.”

21.  It is a settled proposition of law that where an applicant gets an order by making misrepresentation or playing fraud upon the competent authority, such an order cannot be sustained vide S.P. Chengalvaraya Naidu v. Jagannathan, AIR 1994 SC 853.

22.   In Andhra Pradesh State Financial Corporation v. Gar Re-Rolling Mills,AIR 1994 SC 2151 and State of Maharashtra v. Prabhu, 1994(2) SCC 481, the Supreme Court has observed that a writ Court, while exercising its equitable jurisdiction, should not act as to promote perpetration of a legal fraud as the Courts are obliged to do justice by promotion of good faith.  Equity is also known to prevent the law from the craft evasions and subtleties invented to evade law.”

23.  The ratio laid down by the Supreme Court in various cases is that dishonesty should not be permitted to bear the fruit and benefit to persons who played fraud or made misrepresentation, and in such circumstances the Court should not perpetuate  the fraud by entertaining the petitions on their behalf vide District Collector and Chairman, U.S.W School Society v. M. Thirupura Sundri Devi, 1990(3) SCC 655; and Union of India v. M. Bhaskaran, 1996(73) FLR 1676(SC).

24.   In United India Insurance Company Ltd v. V. Rajendra Singh, AIR 2000 SC 1165, the Apex Court observed that Fraud and justice never dwell together” (fraus et jus nunquam cohabitant) and it is a pristine maxim which has never lost its temper over all these centuries.

 

25.    A similar view has been reiterated in K.G. Ashok v. Kerala Public Service Commission, AIR 2001 SC 2010; and Kendiya Vidyalaya Sangathan v. Ram Ratan Yadav, 2003(97) FLR 117 (SC).

26. In Upen Chandra Gogai v. State of Assam, AIR 1998 SC 1289, the Apex Court held that the Court should not validate an action which was not lawful at inception.”  Nor should the Court permit an appointment made by giving a go-bye to the essential mode of recruitment as provided by the Statutory Rules or the rules framed under the proviso to Article 309 of the Constitution which have binding force and  the same cannot be permitted to be over looked/violated vide R.K. Trivedi v. Union of India, 1998 (9) SCC 58.

27.   Similarly, in New India Assurance Co, Shimla v. Kamla, AIR 2001 SC 1419, the Apex Court held that an order which is null and void remains inexecutable and unenforceable forever as it cannot acquire legal validity by any process of sanctification whatsoever for the reason that forgery is anti-thesis to legality and law cannot afford to validate a forgery.

 

28.  In Virendra Kumar Gupta v. State of U.P, 2004 (1) All WC 6, a Division Bench of  Allahabad High Court held that a lease executed in favour of a certain party which had been bequeathed by the original owner to a trust for building an eye hospital was wholly fraudulent, and hence was null and void.

29.   In United India Insurance Company Ltd v. V. Rajendra Singh (supra), the question whether a decree or an order of a Court obtained by fraud is void was again considered and it was held that such an order is wholly void.

30.  The Supreme Court followed its own earlier judgment in S.P. Chengalvaraya Naidu (dead) by L.Rs v. Jagannathan (dead) by L.Rs (supra), in which the Supreme Court observed:

Fraud avoids all judicial acts, ecclesiastical or temporal” observed Chief Justice Edward Coke of England about three centuries ago.  It is the settled proposition of law that a judgment or decree obtained by playing fraud  on the Court is a nullity and non est in the yes of law.  Such a judgment/decree by the first Court or by the highest Court has to be treated as a nullity by every Court, whether superior or inferior.  It can be challenged in any Court even in collateral proceedings.”

31.  The Supreme Court also relied on its earlier decision in Indian Bank v. Satyam Fibres (India) Pvt Ltd, where it was observed that since fraud amounts to an abuse of the process of the Court the Court has inherent power to set aside an order obtained by fraud.

32.  Similar view has been taken by the Supreme Court in Kumari Madhuri Patil & Another v. Addl. Commissioner, Tribal Development & Others, JT 1994 (5) SC 488.

33.  In view of the above, we are of the opinion that there is no merit in the writ petition.  The appeal is, therefore, allowed and the impugned judgment is set aside and the writ petition is dismissed.

Sd./-

CHIEF JUSTICE

Sd./-

March     21,2006              SHIV NARAYAN DHINGRA, J

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