Saju George vs Unknown on 28 February, 2014

[Cites 18, Cited by 0]

Kerala High Court

Saju George vs Unknown on 28 February, 2014

Bench: P.Bhavadasan

       

  

  

 
 
                          IN THE HIGH COURT OF KERALA AT ERNAKULAM

                                                      PRESENT:

                          THE HONOURABLE MR.JUSTICE P.BHAVADASAN

              FRIDAY,THE 28TH DAY OF FEBRUARY 2014/9TH PHALGUNA, 1935

                                             RSA.No. 886 of 2012 ()
                                                  -----------------------
AGAINST THE JUDGMENT IN AS 119/2008 OF II ADDL.DISTRICT COURT, ERNAKULAM
     AGAINST THE JUDGMENT IN OS 49/2006 OF I ADDL.SUB COURT, ERNAKULAM
                                                    ------------------

APPELLANT IN R.S.A-APPELLANT IN A.S- ADDITIONAL DEFENDANT NO.3 IN SUIT :
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            SAJU GEORGE
            CHERUVATHOOR HOUSE,
            THRIKANARVATTOM, ERNAKULAM.

            BY ADVS.SRI.P.B.KRISHNAN
                          SRI.V.B.HARINARAYAN

RESPONDENTS IN RSA - RESPONDENTS IN A.S-PLAINTIFF & DEFENDANTS 1 AND 2
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IN SUIT :
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        1. MOHAMMED SHERIF
            S/O.KUNHIMUHAMED, PUTHENPURAYIL, NETTOOR P.O.
            MARADU, ERNAKULAM-682 304
            NOW WORKING AT THE TRAVANCORE TITANIUM PRODUCTS
            KOCHUVELIL, THIRUVANANTHAPURAM.

        2. M.K.RAJAN
            S/O.KRISHNAN, RESIDING AT 'THUSHARAM', BTS CROSS ROAD
            CHUTTUPADU KARA, EDAPPALLY NORTH VILLAGE, ERNAKULAM
            PIN-682 024.

        3. V.K.ABDUL KAREEM
            PUTHIYAPURAYIL, NETTOOR.P.O., ERNAKULAM-682 304.

            R1 BY SENIOR ADVOCATE SRI.K.RAMAKUMAR
                  BY ADVS. SRI.M.MANOJKUMAR (CHELAKKADAN) (CAVEATOR)
                                 SRI.C.ANILKUMAR (KALLESSERIL)
                                SRI.S.M.PRASANTH
                                SMT.SMITHA GEORGE
            R3 BY ADV. SRI.S.NIRMAL KUMAR


            THIS REGULAR SECOND APPEAL HAVING BEEN FINALLY HEARD
            ON 12-02-2014, THE COURT ON 28-02-2014 DELIVERED THE
            FOLLOWING:

Mn



                       P. BHAVADASAN, J.
                  - - - - - - - - - - - - - - - - - - - - - -
                     R.S.A. No. 886 of 2012
                   - - - - - - - - - - - - - - - - - - - - - -
           Dated this the 28th day of February, 2014.

                               JUDGMENT

The additional third defendant in O.S. 49 of 2006 before the Sub Court, Ernakulam, who along with the other defendants suffered a decree is the appellant. The suit was one for declaration that the decree obtained by the first defendant in the O.S. 475 of 1998 before the Sub Court, Ernakulam is vitiated by fraud and that the further proceedings in pursuance thereto are not binding on the plaintiff in the present suit.

2. The parties are hereinafter referred to as they are arrayed before the trial court. According to the plaintiff, he obtained the plaint schedule property as per Ext.A1 dated 16.5.1995, a partition deed in which D schedule consisting of 13 cents of land in Sy. No.184/3 of Maradu Village was set apart to him. Ever since then, he has been in absolute R.S.A.886/2012.

possession and enjoyment of the property. The plaintiff stays in the tarwad house. The house in the property was in the name of the mother of the plaintiff and after the death of the mother it was to vest with the plaintiff. It is alleged that the brother of the plaintiff got assignment of the house from the mother to his daughter who in turn assigned the house to the first defendant. In 1996 the plaintiff obtained employment in Travancore Titanium Products and thereafter had resided at Thiruvananthapuram for attending his work. He occasionally used to come to the property to collect yield. While so, in December, 2005 he got information that the property was sold in court auction. He then made enquiries and found that a false and fabricated agreement for sale between the plaintiff and the first defendant had been drawn up. As per the said agreement, the plaintiff had agreed to sell his property at Rs.15,000/- per cent and the agreement was dated 18.2.1998 and a sum of Rs.1,75,000/- was paid as advance. The period R.S.A.886/2012.

for execution of the sale deed was six months. The plaintiff came to know that alleging that he had not honoured the terms of the agreement, a suit for specific performance had been filed and a decree obtained. He was not aware of the agreement and subsequent proceedings. He was not in receipt of the lawyer's notice alleged to have been issued by the first defendant nor has he received any process or summons from the court regarding the institution of O.S. 475 of 1998. He had no notice of the execution proceedings also and all proceedings were taken behind his back and therefore, the decree in O.S.475 of 1998 is not binding on him and is infact null and void. If that be so, it is further contended that further proceedings taken in pursuance to such a fraudulent decree cannot be sustained.

3. The first defendant resisted the suit pointing out that the allegations lack merits. The property was brought to sale in execution of the decree in O.S.475 of 1998 and was R.S.A.886/2012.

purchased by the first defendant. He sold it to the third defendant on 19.1.2006. The agreement which was the subject matter of O.S. 475 of 1998 was a genuine document executed by the plaintiff and advance amount was infact paid to him. He then gives details of what transpired thereafter and when the plaintiff failed to perform his part of the contract, lawyer's notice was issued. It was returned with the endorsement no such addressee. He thereafter filed the suit. On the date when the suit was posted for return of summons, a counsel had appeared on behalf of the plaintiff and represented that he wanted to file a written statement. Thereafter there was no participation on the part of the plaintiff and he was set ex parte and an ex parte decree was passed. E.P. 318 of 2001 was filed for execution of the decree. The notice issued to the judgment debtor was returned unserved. Therefore, publication was effected in Mathrubhumi daily dated 9.10.2002. The sale was held on R.S.A.886/2012.

29.11.2002 and certificate was issued. When the matter was posted for delivery, notice was again issued to the plaintiff which also returned unserved and publication was effected. It is thereafter that delivery was given to the first defendant and later he sold the property to the third defendant. This defendant contended that the decree in O.S.475 of 1998 is binding and valid and there are no grounds to ignore that decree.

4. The second defendant denied the allegations and contended that the accusation against him are without any basis and the suit is devoid of merits.

5. The third defendant also filed a written statement pointing out that he is a bonafide purchaser from the first defendant and then adopted almost all the contentions taken by the first defendant.

6. Issues were raised by the trial court and the parties adduced evidence. The evidence consists of the R.S.A.886/2012.

testimony of P.W.1 and documents marked as Exts.A1 and A2 from the side of the plaintiff. The defendants examined D.W.1 and had Exts.B1 to B9 marked. On an appreciation of the evidence, the trial court reached the following conclusions:

i) The first defendant did not produce the agreement and prove that it contained the signature of the plaintiff.

ii) The first defendant had not produced any document to show that he had paid the advance amount as claimed by him.

iii) The evidence of the first defendant cannot be accepted as he is an interested witness.

iv) The first defendant did not prove what kind of summons was served on the plaintiff in O.S.475 of 1998.

v) Exts. B7 and B8 publications are within the territorial limits of Ernakulam while the plaintiff was R.S.A.886/2012.

residing in Thiruvananthapuram. Therefore, he could not take notice of the publication.

vi) The first defendant had not taken steps as against the second defendant inspite of the claim made by the plaintiff. The first defendant ought to have examined the second defendant.

vii) Oral evidence adduced by the first defendant as against the agreement is inadmissible.

viii) The second defendant remained away from the proceedings to conceal the truth.

ix) There is no manner of service of notice in O.S.475 of 1998.

Based on the above finding, the suit was decreed.

7. Aggrieved by the judgment and decree, the third defendant carried the matter in appeal as A.S.119 of 2008. The appellate court rendered its judgment based on the decision reported in Kerala Solvent Extractions Ltd. v. R.S.A.886/2012.

Unnikrishnan (1994(1) K.L.T. 651). Referring to the decision reported in Saroja v. Chinnu Swamy (AIR 2007 SC 3067) the appellate court has observed that the ex parte decree obtained is as good as a decree obtained on merits and it can be executed. The lower appellate court also found that an adjudication on the validity of the agreement is not possible since the same has not been produced by the plaintiff. However, the lower appellate court held that the defendants have not proved that the plaintiff has notice of O.S.475 of 1998 and entered the following finding:

i) Relying on the decision reported in Anil Rishi v.

Gurbaksh Singh (2006(2) K.L.T. SB Case No.95) it was held that the burden was on the plaintiff to prove that he was staying at Thiruvananthapuram at the time of execution of the agreement.

ii) Ext. B4 notice returned unserved.

R.S.A.886/2012.

iii) The appellate court noticed that D.W.1 had admitted that summons was not served on the plaintiff in O.S. 475 of 1998.

iv) The lower appellate court also held that since the plaintiff did not got the documents in O.S.475 of 1998 marked, it is not possible to ascertain the facts.

v) It was held that from the E.P. proceedings it could seen that the suit was not instituted in the address in which the plaintiff was resided.

vi) It was also held that the first defendant claimed that the plaintiff was not residing in the address shown in the plaint in O.S.475 of 1998 so went on to hold that the decree was obtained by fraud. On the basis of the above findings, the court below dismissed the appeal confirming the decree of the trial court. R.S.A.886/2012.

8. The said judgments and decrees are assailed in this second appeal.

9. At the time of admission, the following questions of law were formulated:

"(i) Has plaintiff pleaded and proved fraud in the transaction and/or court proceedings?

(ii) In the absence of agreement and/or the suit records in evidence, is it legal or proper to enter a finding of fraud in regard thereto?

(iii) Is the lower appellate court justified in proceeding as though the address of plaintiff was wrongly shown in the prior proceedings when plaintiff has not pleaded or proved any such fact.

(iv) When plaintiff has not produced the best evidence, i.e., records of his alleged employer to show that he was not in Kochi to execute the agreement on 18.2.1998 is it not necessary to draw an adverse inference against the plaintiff?

(v) When property is delivered through court in execution, it is legal or proper to pass a decree restraining taking possession of the property?"

R.S.A.886/2012.

10. Shri. P.B.Krishnan, learned counsel appearing for the appellant contended that both the courts below have misdirected themselves on facts and in law. The definite stand taken by the plaintiff in the suit is that the decree in O.S. 475 of 1998 was obtained by fraud and misrepresentation. According to the learned counsel, the agreement which formed the basis for the cause of action in O.S.475 of 1998 is not produced. Apart from the fact that there are no pleadings regarding the details of the fraud or misrepresentation alleged to have been practiced by the plaintiff. It is significant to notice, according to the learned counsel, that neither the agreement which is alleged to be a concocted document nor the records in O.S.475 of 1998 were got marked by the plaintiff to show that his claims are true. He has not produced any documents to show that at the relevant time he was working in Travancore Titanium Products and was not available in the address shown in the plaint in O.S.475 of R.S.A.886/2012.

1998. Learned counsel also referred to the fact that even in the present plaint, the address of the plaintiff is the same as in the plaint in O.S.475 of 1998. Learned counsel went on to point out that fraud as contemplated for setting aside a decree obtained by a party is extrinsic fraud and it is for the the plaintiff to plead and prove that fraud has been played on the court and a fraudulent decree had been obtained. Even when P.W.1 was examined, he admitted that the address shown in the present plaint is his address and any notice taken in that address will be served on him. Learned counsel went on to point out that the courts below were totally in error both on facts and in law in holding that the burden is on the defendants to establish that in O.S.475 of 1998 notice has been served on the plaintiff herein. Every decree is presumed to be valid and unless otherwise proved, the decree is good and binding on the parties to the decree. It is not for the defendants to show that the agreement is a genuine one and R.S.A.886/2012.

also that the procedures have not been violated in the suit. The initial burden is on the plaintiff to show that the agreement was a fraudulent document and also that misrepresentation or fraud was practiced in the suit. He had to necessarily show that the plaintiff in the earlier suit was aware of the fact that the plaintiff in the present suit was not residing in the address shown in the plaint and thereafter had caused the court to believe that summons has been served on the defendant in the suit. Learned counsel relied on the decision reported in Bishundeo v. Seogeni Rai (AIR 1951 SC

280) and pointed out that there should be a specific plea regarding fraud and the entire burden is on the plaintiff to establish that fact. If that principle is applied to the facts in the present case, it can easily be seen that there is no evidence adduced by the plaintiff in the case to show that the decree in O.S.475 of 1998 is a fraudulent one.

R.S.A.886/2012.

11. Relying on the decision reported in Gopalakrishnan v. Rajamma (2006(4) K.L.T. 377), Shri. K. Ramakumar learned Senior Counsel appearing for the respondent pointed out that the decree was obtained by fraud and is a nullity. It can be seen from the evidence of D.W.1, according to the learned Senior Counsel, that he was aware of the fact that the plaintiff was not residing in the address shown in the plaint in O.S.475 of 1998 and thereafter he had managed to obtain a decree. He therefore deliberately misled the court. According to the learned Senior Counsel, it was for the defendants to show that proper procedures were followed in the earlier suit and a proper decree was obtained. According to the learned Senior Counsel, both the courts below have found that the plaintiff in the earlier suit had played fraud and the decree in the earlier suit is null and void. Being a finding on facts, unless it is shown to be perverse or against the documents on record, interference under Section R.S.A.886/2012.

100 of the Code of Civil Procedure is not warranted. For the above proposition, learned Senior Counsel relied on the decision reported in Karnataka Board of Wakf v. Anjuman-E-Ismail Madris-un-Niswan ((1999) 6 SCC 343).

12. In the decision reported in Gireesh Chandra Babu v. Divisional Forest Officer (2009(2) K.L.T. 909) it has been held that when a decree is found to be null and void, it is not necessary to have it set aside and it can be ignored. If on the other hand, if it is only a voidable decree, then necessary relief will have to be sought for to set aside the decree.

13. The sum and substance of the plaintiff's case is that he had not executed the agreement which furnished the cause of action in O.S.475 of 1998 and is a fraudulent document. The further claim is that he had no notice of the proceedings in O.S.475 of 1998 and the plaintiff in the said suit had managed to misrepresent to the court that summons was served on him and a decree has been obtained. R.S.A.886/2012.

14. "Fraud" is defined in Indian Contract Act. Section 17 of the said Act reads as follows:

"17. 'Fraud' defined.- 'Fraud' means and includes any of the following acts committed by a party to a contract, or with his connivance, or by his agent, with intent to deceive another party thereto or his agent, or to induce him to enter into the contract:-

(1) the suggestion, as a fact, of that which is not true, by one who does not believe it to be true;

(2) the active concealment of a fact by one having knowledge or belief of the fact;

(3) a promise made without any intention of performing it;

(4) any other act fitted to deceive;

(5) any such act or omission as the law specially declares to be fraudulent.

Explanation.- Mere silence as to facts likely to affect the willingness of a person to enter into a contract is not fraud, unless the circumstances of the case are such that, regard being had to them, it is the duty of the person keeping silence to speak, or unless his silence, is, in itself, equivalent to speech."

R.S.A.886/2012.

As to what constitutes fraud, one may refer to the decision reported in Bhaurao Dagdu Paralkar v. State of Maharashtra ((2005) 7 SCC 605) wherein it was held as follows:

"11. "Fraud" as is well known vitiates every solemn act. Fraud and justice never dwell together. Fraud is a conduct either by letter or words, which includes the other person or authority to take a definite determinative stand as a response to the conduct of the former either by words or letter. It is also well settled that misrepresentation itself amounts to fraud. Indeed, innocent misrepresentation may also give reason to claim relief against fraud. A fraudulent misrepresentation is called deceit and consists in leading a man into damage by wilfully or recklessly causing him to believe and act on falsehood. It is a fraud in law if a party makes representations, which he knows to be false, and injury enures therefrom although the motive from which the representations proceeded may not have been bad. An act of fraud on Court is always viewed seriously. A collusion or conspiracy with a view to deprive the rights of the others in relation to a property would render the transaction void ab initio. Fraud and deception are synonymous. Although in a given case a R.S.A.886/2012.

deception may not amount to fraud, fraud is anathema to all equitable principles and any affair tainted with fraud cannot be perpetuated or saved by the application of any equitable doctrine including res judicata. (See Ram Chandra Singh v. Savitri Devi and Ors. (2003 (8) SCC 319).

12. In Shrisht Dhawan v. Shaw Bros, it was observed as follows:

""Fraud" and collusion vitiate even the most solemn proceedings in any civilized system of jurisprudence. It is a concept descriptive of human conduct. Michael Levi likens a fraudster to Milton's sorcerer, Comus, who exulted in his ability to, 'wing me into the easy-hearted man and trap him into snares'. It has been defined as an act of trickery or deceit. In Webster's Third New International Dictionary "fraud" in equity has been defined as an act or omission to act or concealment by which one person obtains an advantage against conscience over another or which equity or public policy forbids as being prejudicial to another. In Black's Legal Dictionary, "fraud" is defined as an intentional perversion of truth for the purpose of inducing another in reliance upon it to part with some valuable thing belonging to him or surrender a legal right; a false representation of a R.S.A.886/2012.

matter of fact whether by words or by conduct, by false or misleading allegations, or by concealment of that which should have been disclosed, which deceives and is intended to deceive another so that he shall act upon it to his legal injury. In Concise Oxford Dictionary, it has been defined as criminal deception, use of false representation to gain unjust advantage; dishonest artifice or trick. According to Halsbury's Laws of England, a representation is deemed to have been false, and therefore a misrepresentation, if it was at the material date false in substance and in fact. Section 17 of the Indian Contract Act, 1872 defines "fraud" as act committed by a party to a contract with intent to deceive another. From dictionary meaning or even otherwise fraud arises out of deliberate active role of representator about a fact, which he knows to be untrue yet he succeeds in misleading the representee by making him believe it to be true. The representation to become fraudulent must be of fact with knowledge that it was false. In a leading English case i.e. Derry and Ors. v. Peek (1886-90) All ER 1, what constitutes "fraud" was described thus : (All ER p. 22 B-C) "fraud" is proved when it is shown that a false representation has been made (i) knowingly, or (ii) without belief in its truth, or (iii) R.S.A.886/2012.

recklessly, careless whether it be true or false".

But "fraud" in public law is not the same as "fraud" in private law. Nor can the ingredients, which establish "fraud" in commercial transaction, be of assistance in determining fraud in Administrative Law. It has been aptly observed by Lord Bridge in Khawaja v. Secretary of State for Home Deptt. (1983)1 All ER 765, that it is dangerous to introduce maxims of common law as to effect of fraud while determining fraud in relation of statutory law. "Fraud" in relation to statute must be a colourable transaction to evade the provisions of a statute.

"If a statute has been passed for some one particular purpose, a Court of law will not countenance any attempt which may be made to extend the operation of the Act to something else which is quite foreign to its object and beyond its scope. Present day concept of fraud on statute has veered round abuse of power or mala fide exercise of power. It may arise due to overstepping the limits of power or defeating the provision of statute by adopting subterfuge or the power may be exercised for extraneous or irrelevant considerations. The colour of fraud in public law or administration law, as it is developing, is assuming R.S.A.886/2012.

different shades. It arises from a deception committed by disclosure of incorrect facts knowingly and deliberately to invoke exercise of power and procure an order from an authority or tribunal. It must result in exercise of jurisdiction which otherwise would not have been exercised. The misrepresentation must be in relation to the conditions provided in a section on existence or non-existence of which the power can be exercised. But non-disclosure of a fact not required by a statute to be disclosed may not amount to fraud. Even in commercial transactions non-disclosure of every fact does not vitiate the agreement. "In a contract every person must look for himself and ensures that he acquires the information necessary to avoid bad bargain". In public law the duty is not to deceive." (See Shrisht Dhawan (Smt.) v. M/s. Shaw Brothers, (1992 (1) SCC 534).

15. Order VI Rule 4 of C.P.C. reads as follows:

"4. Particulars to be given where necessary.- In all cases in which the party pleading relies on any misrepresentation, fraud, breach of trust, wilful default, or undue influence, and in all other cases in which particulars may be necessary beyond such as are R.S.A.886/2012.

exemplified in the forms aforesaid, particulars (with dates and items if necessary) shall be stated in the pleading."

A reading of the above provision shows that in a case of fraud, misrepresentation etc., the entire details will have to be given by the person alleging the same. In the decision reported in Bishundeo Narain's case (supra) it was held as follows:

"25. It is also to be observed that no proper particulars have been furnished. Now if there is one rule which is better established than any other, it is that in cases of fraud, undue influence and coercion, the parties pleading it must set forth full particulars and the case can only be decided on the particulars as laid. There can be no departure from them in evidence. General allegations are insufficient even to amount to an averment of fraud of which any Ct. ought to take notice, however strong the language in which they are couched may be and the same applies to undue influence and coercion. See O. 6, R. 4, Civil P. C."

R.S.A.886/2012.

16. It is also well settled that the burden is on the plaintiff to plead fraud and establish the same. In the decision reported in Satis Chandra v. Satish Kantha (AIR 1923 Privy Council 73) it was held as follows:

"Charges of fraud and collusion must, no doubt, be proved by those who make them- proved by established facts or inferences legitimately drawn from those facts taken together as a whole. Suspicions and surmises and conjectures are not permissible substitutes for those facts or those inferences, but that by no means requires that every puzzling artifice or contrivance resorted to by one accused of fraud must necessarily be completely unravelled and cleared up and made plain before a verdict can be properly found against him. If this were not so, many a clever and dexterous knave would escape."

17. In the decision reported in Union of India v. M/s. Chaturbhai M. Patel & Co. (AIR 1976 SC 712), it was held as follows:

R.S.A.886/2012.

"7. ........It is well settled that fraud like any other charge of a criminal offence whether made in civil or criminal proceedings, must be established beyond reasonable doubt: per Lord Atkin in A. L. N. Narayanan Chettyar v. Official Assignee, High Court Rangoon, AIR 1941 PC 93. However suspicious may be the circumstances, however strange the coincidences, and however grave the doubts, suspicion alone can never take the place of proof. In our normal life we are sometimes faced with unexplainable phenomenon and strange coincidences, for, as it is said, truth is stranger than fiction."

18. The question that necessarily arises is what constitutes "fraud" which would vitiate a decree.

19. Kerr on Fraud and Mistake, Seventh Edition, at page 416, it was observed as follows:

"In applying this rule, it matters not whether the judgment impugned has been pronounced by an inferior or by the highest Court of judicature in the realm, but in all cases alike it is competent for every Court, whether superior or inferior, to treat as a nullity R.S.A.886/2012.

any judgment which can be clearly shown to have been obtained by manifest fraud, discovered after the judgment. An innocent party cannot now prove in one Court that a judgment against him in another Court was obtained by fraud and ask for it to be disregarded, as it would be in his power to apply directly to the Court which pronounced it to vacate it. But however this may be, it is evident that a guilty party would not be permitted to defeat a judgment by showing that in obtaining it he had practised an imposition on the Court.

In order to sustain an action to impeach a judgment, actual fraud must be shown; mere constructive fraud is not, at all events after long delay, sufficient. The Court has jurisdiction to set aside a judgment obtained by fraud in a subsequent action brought for that purpose, the proper remedy being an original action and not a re-proof that the judgment was obtained by perjury.

An action to set aide a judgment in a probate action on the ground of fraud ought not to be allowed to proceed unless the plaintiff can produce evidence showing a reasonable probability of the alleged fraud being established; but such evidence need not R.S.A.886/2012.

necessarily be of such a character that it would be evidence in the action itself."

20. In Words and Phrases Permanent Edition Vol. 37A at page 128, the following observation is made:

" "Frauds" for which a court may set aside a former judgment between the same parties are limited to matters which are extrinsic and collateral to the issue tried in the former case, and do not include fraud in procuring a judgment by false testimony, unless it is shown among other things that the witness had been convicted of perjury."

21. In the Law of Fraud and Fraudulent Transfers in India by Dhodi at page 94, it is observed as follows:

"Section 44 of the Evidence Act makes provision for contesting or impeaching on the ground of fraud, judgments between parties, judgments regarding public matters and judgments in rem. A party to a judgment or decree can show that it had been obtained by fraud. It is settled law that a decree, whether it be a consent decree, or an ex parte decree or a decree passed after contest, can be impeached, on the ground of fraud by a separate suit. A party to a proceeding is never disabled from R.S.A.886/2012.

showing that a judgment or order has been obtained by the opposite party by fraud. But the party who has by fraud procured a judgment cannot allege fraud to defeat that judgment. If a fraudulent decree is procured, it is fraud on the court and on the parties, except in case of compromise decrees. Third person can treat a fraudulent decree as nullity but a party to it can so treat it only if it is set aside within limitation. The jurisdiction to impugn a previous decree for fraud is recognized by Section 44 of the Evidence Act but it must be exercised with due care and reserve.

At page 95, it is observed as follows:

"Fraud is no doubt an extrinsic collateral act which vitiates the most solemn proceedings of a court of justice but it must be proved to have been in relation to those proceedings so as to entitle one court to differ as to the decision on a point of fact. The fraud must be actual positive fraud, a meditated and intentional contrivance to keep the parties the parties and the court in ignorance of real facts, thus obtaining a decree by that contrivance and misleading of the curt. The fraud should be proved to be a contrivance preventing the opponent from placing his case before the court."

R.S.A.886/2012.

22. In Corpus Juris Secundum Vol.37 at page 175, it is observed as follows:

"Extrinsic fraud.

Extrinsic fraud means fraud that induced a party to default or to consent to judgment against him. Intrinsic fraud Intrinsic fraud is any fraudulent conduct of the successful party which has practiced during the course of an actual adversary trial of the issues joined and which had no effect directly or affirmatively to mislead the defeated party to his injury after he announced that he was ready to proceed with the trial."

At page 183, it is observed as follows:

"Comprehensively stated, the elements of actionable fraud consist of: a representation; its falsity; its materiality; the speaker's knowledge of its falsity or ignorance of its truth; his intent that it should be acted on by the person and in the manner reasonably contemplated; the hearer's ignorance of its falsity; his reliance on its truth; his right to rely thereon; and his consequent and proximate injury. Similarly, it has been held that to constitute actionable fraud it must appear:

that defendant made a material representation; that it R.S.A.886/2012.

was false; that, when he made it, he knew that it was false, or made it recklessly, without any knowledge of its truth and as a positive assertion; that he made it with the intention that it should be acted on by plaintiff; that plaintiff acted in reliance on it; and that he thereby suffered injuy."

At page 186, it is observed as follows:

"Fraud taints and vitiates everything it touches. Whatever from it may assume, the law furnishes a remedy therefor when it is exposed. If the essential elements of actionable or remedial fraud requisite to the particular remedy sought are present, the nature of the transaction or the subject matter of the representation is immaterial. Consequently, in the many and varied transactions in which fraud has been found to exist when, but only when, the elements thereof were present."

At page 264, it is observed as follows:

"The rule that misrepresentations of value are not actionable, has no application to misrepresentations of extrinsic facts affecting value, and the latter may constitute fraud. This is especially true if the extrinsic facts are peculiarly within the knowledge of the speaker R.S.A.886/2012.

and the hearer lacks an equal opportunity of ascertaining the truth. In such cases the hearer has a right to rely on the representations. Thus, redress may be had for misrepresentations a to the source of a chattel; the mind, nature, or condition of personal property; and, the mount and extent of a business or trade, the good will of which is the subject of sale."

23. In American Jurisprudence Vol 23 at page 757, it is observed as follows:

"As applied to fraud, the term "intrinsic usually means that fraud was practiced in procuring the transaction, as distinguished from extrinsic fraud, which means that fraud was practiced in the act of obtaining a judgment in the course of litigation involving a transaction. The latter is actual fraud, but collateral to the transaction in litigation. Extrinsic or collateral fraud is also defined as actual fraud, such that there is on the part of the person chargeable with it the malus animus, since the mala mens puts itself in motion and acts in order to take any undue advantage of some other person for the purpose of actually and knowingly defrauding him."

R.S.A.886/2012.

24. In the case on hand, there are two specific allegations. One is that the agreement which is the subject matter of O.S.475 of 1998 is a forged document and it is null and void. A false claim was put up on the basis of the said document and therefore, the decree is not binding on the plaintiff. It must be remembered here that a document may be void or voidable. If the fraud is with regard to the character of the document, it is void ab initio. But if on the other hand it is with reference to the contents of the document, it is voidable. In the decision reported in Prem Singh v. Birbal ((2006) 5 SCC 353) it was held as follows:

"Fraudulent misrepresentation as regards character of a document is void but fraudulent misrepresentation as regards contents of a document is voidable. Respondent 1 has not alleged that fraudulent misrepresentation was made to him as regards the character of the document. According to him, there had been a fraudulent misrepresentation as regards its contents."

R.S.A.886/2012.

25. In the decision reported in Gopalakrishnan v. Rajamma (2006(4) K.L.T. 377), it was held as follows:

"If the fraudulent representation was with regard to the character of the document, then the document would be void and a suit for setting aside the document buy recourse to S.31 of the Specific Relief Act, 1963 would be unnecessary. But where the fraudulent representation is with regard to the contents of the document, it is only voidable for which a suit for setting aside the document will have to be filed within 3 years as provided under Art.59 of the Limitation Act, 1963. Even where the document is void, once a suit is filed for cancellation of the document, it would be governed by Art.59, which, if not attracted, the residuary Art.113 will apply."

26. In the decision reported in T. Vijendradas v. M. Subramanian ((2007) 8 SCC 751) it was held as follows:

"If any judgment or order is obtained by fraud, it cannot be said to be a judgment or order in law, and the same is rendered a nullity. In a case of nullity, even the principles of natural justice are not required to be R.S.A.886/2012.

complied with. Once it is held that by reason of commission of a fraud, a decree is rendered to be void rendering all subsequent proceedings taken pursuant thereto also a nullity, it would be wholly inequitable to confer a benefit on a party who is a beneficiary thereunder."

27. There can be no doubt that the burden is on the plaintiff to show that the decree in O.S. 475 of 1998 was obtained by fraud. In the light of the principle laid down in various decisions, the burden is on the plaintiff to show that the agreement is a fraudulent document. What is significant is that even though the plaintiff claims that the agreement does not contain his signature and the signature has been forged, he did not take any steps to have the agreement produced before court and marked. In fact, the lower appellate court has taken note of this fact though the trial court was greatly impressed by the argument that since the first defendant had not caused the agreement to be produced before court, the decision should go against the defendants. R.S.A.886/2012.

As already noticed, it is for the plaintiff to establish that the document was a fraudulent one. There was no attempt to do so except his interested testimony at the time of evidence.

28. One of the reasons given by the plaintiff to allege that the agreement is a fraudulent document is that on the relevant date, he was employed in Travancore Titanium Products and he was attending his work on that day. For reasons best known to the plaintiff, he had not produced any document to establish or substantiate his claim. It is indeed strange that both the courts blamed the first defendant for not establishing that the plaintiff was available on the date of execution of the document. It must be remembered here that based on that agreement a decree has been passed. The plaintiff has admitted that the address shown in the plaint in O.S.475 of 1998 was his address. But his claim was that at the relevant time he was working elsewhere and that was known to the plaintiff in the said suit. It is interesting to note that even R.S.A.886/2012.

in the present plaint, the address shown is the same address as the one shown in O.S.475 of 1998 and it is also significant to notice that the plaintiff has not in the present suit disclosed his residential address at Thiruvananthapuram.

29. It cannot be said that the burden is on the defendants to prove that the agreement which furnished the cause of action in O.S.475 of 1998 was not a fraudulent one. It is trite that it is for the person who alleges fraud or misrepresentation etc., or other vitiating circumstances to plead and prove the same. There have been no attempt from the side of the plaintiff in this case to establish that the alleged agreement is a fraudulent one.

30. The other finding of the court below is that the defendants in the present case have not proved that the plaintiff had notice of the earlier suit. Or in other words, summons had been served on the defendant in the earlier suit. R.S.A.886/2012.

31. The evidence in the present case is to the effect as spoken to by D.W.1 is that on the date on which O.S.475 of 1998 was posted for return of summons, a counsel had represented on behalf of the defendant in the said suit and stated that he was appearing for the defendant and he wanted time to file written statement. Thereafter, according to D.W.1, there was no representation and the defendant was set ex parte. Here, one must remember that it is for the plaintiff in the present suit to show that no summons was in fact served on him in O.S.475 of 1998.

32. It is surprising to note that there was no attempt from the side of the plaintiff in the present suit to establish that no notice or summons in the earlier suit was infact served on him. Both the courts blow relied on the fact that since the first defendant in the present suit knew that the plaintiff was employed elsewhere, Exts.B7 and B8 publications are of no use.

R.S.A.886/2012.

33. One may at this juncture refer to Article 123 of the Limitation Act which reads as follows:

"123. To set aside a decree Thirty days The date of the decree or passed ex parte or to re-hear where the summons or an appeal decreed or heard notice was not duly ex parte. served, when the applicant had knowledge of the decree.

Explanation.- For the purpose of this article, substituted service under Rule 20 of Order V of the Code of Civil Procedure, 1908 shall not be deemed to be due service."

Going by Column 3 of the above Article, the person concerned gets 30 days from the date of the decree and in a case where summons was refused or not duly served, time begins to run from the date on which the appellant had knowledge of the decree. What is significant is the explanation contained in Column 1 which is quoted above. A reading of the above provision shows that the legislature has treated that substituted service for the purpose of the said Article i.e., for R.S.A.886/2012.

the purpose of setting aside the ex parte decree, will not be treated as duly served.

34. P.W.1 in his evidence has stated that he had knowledge about the passing of the decree much before and if that be so, there is no justification why he did not resort to legal remedies to have the decree in O.S.475 of 1998 set aside. What is significant is that the law takes care of a situation where it is proved that summons or notice has not been served on the defendant, the period begins to run from the date of knowledge. It is also significant to notice that substituted service will not be treated as due service in which case also it means that time begins to run from the date of knowledge of the decree.

35. Duly served means, service as contemplated under Order V of the Code of Civil Procedure. The intention is that the nature of the claim must be brought to the notice of the defendant. In the decision reported in M/s.Shalimar R.S.A.886/2012.

Rope Works v. M/s. Abdul Hussain (AIR 1980 SC 1163), it was held that mere handing over of summons to the employee of a Company not authorized to receive summons is not amount to due service of notice.

36. It is not possible to concur with the finding of the courts below that the burden was on the defendant to show that the agreement which forms the subject matter of O.S.475 of 1998 was not a fraudulent one and also that the decree obtained therein was not by practicing fraud or misrepresentation.

37. One may recall here that it is the plaintiff who claims that there was no service of summons and fraud has been practiced on him. Normally official acts are deemed to have been performed in accordance with law. If a person has a grievance that it is not so, it is for him to establish the said fact. The courts below were therefore not justified in coming to the conclusion that since the first defendant did not have R.S.A.886/2012.

the records in O.S.475 of 1998 produced, it could not be held that service was proper.

38. One may here again recollect that the plaintiff has not proved or shown that he was residing elsewhere or that his address is not the one shown in the plaint in O.S.475 of 1998 and is different. He could have produced evidence in the form of a certificate from his employer to show that he was working on the relevant date at Travancore Titanium Products and also could have produced evidence to show that he was residing at Thiruvananthapuram at the relevant time. One cannot expect the defendants to go in search of the address of the plaintiff in this case. It is not disputed that the plaintiff in O.S.475 of 1998 had taken steps in the address shown in the agreement which is shown in the present suit also. If the plaintiff shifts his residence, it is for him to inform post office concerned and also take steps to inform about the change of address.

R.S.A.886/2012.

39. It is true that D.W.1 at the time of evidence has stated that he came to know from the sister of the plaintiff in the present suit that P.W.1 was employed. It is this which is taken note of by the court below to come to the conclusion that there was fraud played on the court in obtaining decree in O.S.475 of 1998. The lower appellate court was concerned more with the fact that in the execution proceedings notice was served by publication and that can be related back to the suit to come to the conclusion that there was no proper service of notice. One fails to understand how that could have been done. One may remember that the definite case of D.W.1 in the present suit who is the plaintiff in O.S.475 of 1998 was that on the date on which the said case was posted for return of summons, a counsel had represented on behalf of the defendant therein and that he wanted time to file written statement. At any rate, the burden was on the plaintiff to show that there was no proper service of summons in the R.S.A.886/2012.

suit and in the execution petition. Again, it is for the plaintiff in the subsequent suit to show that dubious methods had been adopted in the previous suit to obtain a decree in execution also. Having not taken any steps to have the agreement which he alleges as fraudulent produced and also having the records in O.S.475 of 1998 produced to show that there has been a fraud played or a misrepresentation by the plaintiff in the said suit, merely because paper publication was effected at the execution stage cannot be taken as a ground to doubt the validity of the decree passed in O.S.475 of 1998. At the risk of repetition, one may observe that the burden is certainly on the plaintiff to establish that fact which will show that fraud has been played on court.

40. There is yet another fact. The first defendant in his written statement has stated that in pursuance to the decree the property was brought to sale, the sale certificate has been issued and delivery has also been made. He further R.S.A.886/2012.

pointed out that the property has been transferred to the third defendant. When possession has gone out of the hands of the plaintiff, it becomes difficult to understand how without a prayer for recovery of possession, the plaintiff can succeed.

41. It therefore follows that there has not been a proper appreciation of the law and the facts of the case by the courts below and as rightly pointed out by the learned counsel for the appellant, the courts below have misdirected themselves both on facts and in law in coming to the conclusion that the decree in O.S.475 of 1998 is a fraudulent decree.

42. It is felt that a reconsideration at the hands of the trial court is necessary in this regard.

In the result, the appeal is allowed, the impugned judgments and decrees of the courts below are set aside and the matter is remanded to the trial court for fresh consideration and disposal in accordance with law and in the R.S.A.886/2012.

light of what has been stated above. The parties will be at liberty to adduce further evidence if they so choose. The parties shall appear before the trial court on 12.03.2014. The trial court may make every endeavour to dispose of the suit within a period of six months from the date of appearance of the parties. Court fee paid shall be refunded to the appellant.

P. BHAVADASAN, JUDGE sb.

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