Gujarat High Court
Maheshbhai Ramanbhai Patel vs Karmajyot Co-Operative Hosg. Society ... on 5 December, 2024
Author: Sunita Agarwal
Bench: Sunita Agarwal
NEUTRAL CITATION
C/LPA/609/2023 JUDGMENT DATED: 05/12/2024
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/LETTERS PATENT APPEAL NO. 609 of 2023
In R/SPECIAL CIVIL APPLICATION NO. 2204 of 2004
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2023
In R/LETTERS PATENT APPEAL NO. 609 of 2023
FOR APPROVAL AND SIGNATURE:
HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE SUNITA
AGARWAL
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
=============================================
Approved for Reporting Yes No
✔
=============================================
MAHESHBHAI RAMANBHAI PATEL
Versus
KARMAJYOT CO-OPERATIVE HOSG. SOCIETY LTD & ORS.
=============================================
Appearance:
MR MEHUL H SHAH, SR ADVOCATE with JENIL M SHAH(7840)
for the Appellant(s) No. 1
MS HETAL PATEL, AGP for the Respondent(s) No. 3
MR BS PATEL, SR. ADVOCATE with MR CHIRAG B PATEL(3679)
for the Respondent(s) No. 1
RULE SERVED for the Respondent(s) No. 6
RULE UNSERVED for the Respondent(s) No. 7,8
=============================================
CORAM:HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE
SUNITA AGARWAL
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
Date : 05/12/2024
ORAL JUDGMENT
(PER : HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE SUNITA AGARWAL) Page 1 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined
1. By means of the instant appeal, the appellant herein seeks to challenge the judgment and order dated 03.03.2023 passed by the learned Single Judge in granting the prayers made by the original petitioner for quashing the consent decrees dated 24.08.2000 passed in Special Civil Suit No. 637 of 2000 and dated 17.05.2003 in Regular Civil Suit No. 538 of 2003. Further the direction issued by the learned Single Judge that any action taken pursuant to the aforesaid consent decrees against the petitioner society be also quashed and set aside. A further direction has been given to the appropriate officer as authorised by the court of Principal Senior Civil Judge, Vadodara and the District Collector, to register criminal proceedings against the perpetrators of fraud.
2. We may note that the original Writ petition was filed by the society registered under the Gujarat Cooperative Societies Act, 1961, constituted for the purpose of construction of residential units for its members. The original respondent no.4 who was holding the agricultural land bearing Revenue survey no.640 in the sim of village Gotri, District Vadodara had executed two sale deeds in favour of the petitioner society on 10.11.1985 with regard to an area of 1440 sq. mtrs. of land, which was declared as retainable land under the provisions of the Urban Land (Ceiling And Regulation) Act, 1976. It is noted by the learned Single Judge that the ULC authority disposed of the declaration form submitted by the original owner, viz. respondent no.4 of Page 2 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined by order dated 30.03.1991, whereunder an area of 3861 sq. mtrs. of Revenue survey no. 650 was declared surplus and vested with the State Government, while the remaining 1440 sq. mtrs. of land was declared in the holding of respondent no.4. It is also noted that the possession of the surplus land was already taken by the State authorities on 02.11.1985.
3. Much after the completion of the ceiling proceedings and execution of the sale deeds in favour of the original petitioner society, a civil suit was instituted by a third party, viz. respondent no.5 in the original petition before the Court of Civil Judge (SD), Vadodara seeking right in the entire piece of land bearing Revenue survey no. 650 admeasuring 5261 sq.mtrs. by praying for specific performance of an agreement. The said suit was registered as Special Civil Suit No. 637 of 2000. It is pertinent to note that only respondent no.4-original owner of the land in question was impleaded in the said suit and it was got disposed of on a compromise purshis dated 08.08.2000 submitted before the Civil Judge (SD), Vadodara. A decree dated 24.08.2000 in terms of the compromise was passed for execution of the sale deed.
4. It is an admitted fact of the matter that neither the State Government with which the area of 3861 sq. mtrs. of surplus declared land already vested nor the original petitioner society which had purchased the area of 1440 sq. mtrs. vide sale deeds dated 10.11.1985, were joined as parties in the suit. The result is that the suit was Page 3 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined decreed on a compromise arrived between the original owner namely respondent no.4 and a third party plaintiff in order to frustrate the interest of the State and the society.
5. On coming to know about the compromise decree dated 24.08.2000, the petitioner society filed a Review application no.301 of 2000 before the Civil Judge (SD) Vadodara pointing out the correct facts.
6. During the pendency of the said review application, the appellant herein viz. the original respondent no.7 instituted a Regular Civil Suit No. 535 of 2003 in the Court of Civil Judge, Vadodara on 15.05.2003 on the plea of adverse possession over the area of 1440 sq. mtrs. of Revenue survey no. 650. Within a period of 2 days of the institution of the said suit, on a compromise purshis, the decree dated 17.05.2003 was passed granting declaration in favour of the appellant of being in possession of the land in question (Revenue suit no. 650 paiki 1440 sq. mtrs.) adverse to the original owner, viz. original respondent no.4. The respondent no.4 has been restrained from interfering in the right of the appellant herein to enjoy the property in question and further from recording his name in the revenue records.
7. It was further noted by the learned Single Judge that the petitioner Society was constrained to institute Regular Civil Suit no. 159 of 2004 wherein notices were issued and further a court commissioner has been appointed, who has drawn panchnama on 12.02.2004, which reveals Page 4 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined that the petitioner society is in possession of the property admeasuring 1440 sq. mtrs. of land. The copy of the panchnama is appended as Annexure 'M' to the original Writ petition. The Writ petition invoking extraordinary supervisory jurisdiction of the High Court under Article 226/227 has been filed to restrain the private respondents from interfering in the right of the petitioner society to enjoy the property on account of repeated litigation instituted by one or the other person(s) to grab the land in question.
8. On the presentation of the Writ petition, an order dated 27.02.2004 was passed by this Court while issuing notices to the respondents directing the parties to the petition to maintain status quo as to the possession and user of the land in question. By common order dated 17.12.2004, this Court has protected the interest of the petitioner society by recording the statement of the learned advocate appearing for respondents no.4 to 6 that in addition to the ad-interim relief granted earlier, the said respondents shall not act upon the consent decree in any manner whatsoever, which may result into changing the position of the land either way.
9. On 22.12.2004, while taking on record the affidavit-in- reply filed on behalf of the respondent no.7, the appellant herein, the order passed by this Court reads as under :-
"The affidavit in reply filed on behalf of the respondent No.7 is taken on record. This court on Page 5 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined 17.12.2004 had passed the following order:
"Mr.Majmudar, Ld.Advocate for respondent Nos 4 to 7 seeks time to file reply. Mr.Desai, Ld.AGP also seeks time to declare before the court as to whether the land in question which is a part of the socalled consent decree is a land declared as surplus land by ULC authorities even as on today or not . He states that as per the record produced in the petition the land is declared as surplus land. As per the statement made in the suit if any scheme is sanctioned under section 21 of the ULC Act for the remaining land excluding the land of the petitioner, the respondent Nos 4 to 6 may produce such details. Under the circumstances SO to 22.12.2004.
Mr.Majmudar learned counsel for respondent Nos 4 to 6 declares that in addition to the ad interim relief granted earlier, the respondent Nos 4 to 6 shall not act upon the consent decree in any manner whatsoever which may result into changing the position of the land either way."
2. Today, as recorded hereinabove, affidavit in reply has been filed on behalf of the respondent No.7. Primafacie, it appears that there is no dispute on the point that the total land held by the petitioner was admeasuring 5261 Sq.Mtrs bearing S.No.650 out of which the land admeasuring 4221 Sq.Mtrs was declared as surplus land under Urban Land (Ceiling & Regulation) Act, 1976 and the land admeasuring 1446 Sq.Mtrs was held as retainable land for the original owner-Pratapsinh Dahyabhai Parmar-the respondent No.4 herein. It is also admitted position that a registered sale deed is executed in favour of the petitioner-society for the land admeasuring 1440 Sq.Mtrs which was clear land and the said sale deed is executed by the Power of Attorney of the respondent No.4. However, the stand of the respondent No.4 in the Page 6 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined affidavit in reply is that the society was a proposed society and it was not an agriculturist and therefore the transaction can be said as illegal. It is also the case of the respondent No.7 in the affidavit in reply that the transaction of sale can be said as invalid in view of the provisions of section 63 of the Bombay Tenancy & Agricultural Lands Act. It is also an admitted position that no competent authority under the Tenancy Act has declared the transaction entered into by way of registered sale deed as null and void. Further, from the record it it is apparent that the first suit was filed for the total area of the land admeasuring 5261 Sq.Mtrs which includes the land which is declared as surplus land. Thereafter, the suit is filed for the area of land admeasuring 1440 Sq.Mtrs which is declared as retainable land. The consent purshis is filed in both the suits and it is required to be noted that when the petitioner moved the application for recalling of the order for consent decree in the first suit, i.e. Spl.Civil Suit No.637/00 another suit being Reg.Civil Suit No.538/03 is filed and another consent purshis is submitted. Primafacie, it appears that it is a design to frustrate the rights of the State Govt over the land which is declared as surplus land and the rights of the petitioner herein over the land which is purchased by the petitioner by registered sale deed. Neither the State Govt nor the petitioner is impleaded as party in the said suit and on the basis of the said consent decree the rights are sought to be frustrated. Prima facie, it appears that it is a designed adopted tofrustrate the rights of the parties over the property which were in existence as per the provisions of Transfer of Property Act and as per the provisions of ULC Act. Unfortunately, application was made to the learned judge but the same is rejected. In a matter where fraud is primafacie played before the civil court while getting the consent decree it would be a case for interference under the supervisory jurisdiction of this court under Article 226/227 of the Constitution of India. Merely because an appeal is not preferred against the consent decree or Page 7 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined application for recalling of the order or fresh suit is not filed in my view should not operate as a bar for exercising the power of this court. Reference may be made to the decision of this court in the matter of United India Insurance Co.Ltd vs Rajendra Singh & Ors reported in AIR 2000 SC 1165 wherein at para 3 and 4 the Apex Court observed as under:
"3. Fraud and justice never dwell together. (Frans etjus nunquam cohabitant) is pristine maxim which has never lost its temper over all these centuries. Lord Denning observed in a language without equivocation that 'no judgment of a court, no order of a Minister can be allowed to stand if it has been obtained by fraud, for, fraud unravels everything.'(Lazarus Estate Ltd vs Beasley 1956 (1) QB 702).
4. For a High Court in India to say that it has no power even to consider the contention that the awards secured are the byproducts of stark fraud played on a tribunal, the plenary power conferred on the High Court by the Constitution may become a mirage and people's faith in the efficacy of the High Courts would corrode. We would have appreciated if the Tribunal or at least the High Court had considered the plea and found them unsustainable on merits, if they are meritless. But when the courts preempted the Insurance Company by slamming the doors against them, this court has to step in and salvage the situation." Therefore, the contention that as the appeal is not preferred or as the suit for setting aside of the consent decree is not filed this court may not exercise the power in writ jurisdiction can not be accepted.
3. In view of the above, I am inclined to pass the following order:
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(i) Rule.
(ii) By interim order the operation and implementation of both the consent decrees passed in Special C.S.No.637/00 and Reg.C.S.No.538/03 shall remain stayed and suspended.
(iii) It is further directed that the Ld.Civil Judge (SD), Baroda shall hold inquiry regarding alleged fraud played by the parties to the proceedings of the aforesaid suits and the persons who are directly or indirectly connected and shall complete such inquiry after giving opportunity to all concerned and shall report to this court within a period of six months from today. After the report is submitted to this court it would be open to either side to move this court for further orders and/or for final hearing of the matter.
(iv) The District Collector, Vadodara shall also additionally examine the matter qua the rights of the Govt in respect of land which is declared as surplus land under ULC Act and shall also examine as to whether the action in accordance with law should be taken including for initiating prosecution against the persons who have made an attempt to frustrate the rights. However, before taking any final action for lodging of prosecution or otherwise, report shall be made to this court and after appropriate permission is obtained from this court the action shall be taken."
10. A perusal of the order dated 22.12.2004 indicates that the respondent no.4 had admitted that the registered sale deeds were executed in favour of the petitioner society for the land admeasuring 1440 sq. mtrs. which was a clear land and the said sale deeds were executed Page 9 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined by the Power of Attorney of the respondent no.4, the original owner. The stand of the respondent no.4 in his affidavit-in-reply filed before the Writ court, was also noted to the effect that the society was a proposed society and it was not an agriculturist and, therefore, the transaction can be said as illegal and invalid in view of the provisions of Section 63 of the Bombay Tenancy And Agricultural Lands Act.
11. The above stand of the respondent no.4 has been dealt with while recording that no proceeding under the Tenancy Act has been initiated to declare the registered sale deed as null and void. After passing of the consent decree in the suit, i.e. first Special Civil Suit No. 637 of 2000 with respect to the total area of land admeasuring 5261 sq. mtrs., which included the land declared as surplus, while the recall application filed by the petitioner society was pending, another suit being Regular Civil Suit No. 538 of 2003 was filed for the area of land admeasuring 1440 sq. mtrs., which was declared as retainable land.
12. It is noted therein that the manner in which the first suit had been filed and the compromise purshis was filed in the second suit during the pendency of the recall application, it appeared to be an act designed to frustrate the rights of the State Government over the land which was declared as surplus land and also the rights of the petitioners who purchased the remaining area by registered sale deeds. It was, thus, opined that Page 10 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined in a manner where fraud is prima facie played before the Civil Court while getting the consent decree, it would be a case for interference under the supervisory jurisdiction of the High Court under Article 226/227 of the Constitution of India. The remedy of appeal against the consent decree or an application for recalling the order or filing of fresh suit, should not operate as a bar for exercising the power of this Court.
13. Taking note of the judgment of the Apex Court in United India Insurance Co.Ltd vs Rajendra Singh & Ors [AIR 2000 SC 1165], it was noted by the Court that fraud and justice never dwell together. The plenary power conferred on the High Court by the Constitution may become a mirage and people's faith in the efficacy of the High Courts would corrode if the High Court says that it has no power even to consider the contention that the awards secured are the byproducts of stark fraud played on a tribunal.
14. The plea of the respondent no.7-appellant herein that as the appeal is not preferred or a suit for setting aside of the consent decree is not filed this Court may not exercise its power in Writ jurisdiction, has been turned down while suspending the operation and implementation of both the consent decrees passed in Special Civil Suit no.637 of 2000 and Regular Civil Suit no. 538 of 2003.
15. On the directions issued by this Court in the aforesaid order dated 22.12.2004, two reports of inquiry Page 11 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined conducted by the Civil Judge (SD), Vadodara and the District Collector, Vadodara were filed. The learned Single Judge taking note of the aforesaid reports records in the judgment impugned that both the civil suits wherein compromise decrees had been obtained were decided behind the back of the petitioner society. The sole issue before the Court, therefore, remained as to whether the consent decree which was obtained by fraud and is a nullity can be set aside by this Court in wake of undisputed facts on record.
16. It was, thus, noted that the respondent no.4, namely Pratapsinh Dahyabhai Parmar, the original owner was defendant no.1 in the Special Civil Suit no.637 of 2000 and the sale deed in favour of the petitioner society was executed by Ranjikant Jashbhai Brahmbhatt, the power of attorney of respondent no.4, namely Pratapsinh Dahyabhai Parmar who was also defendant no.1 in the second suit viz. Special Civil Suit No. 535 of 2003. The original defendant no.1, however, did not disclose the said fact in both the suits and also the factum of compromise arrived in the first suit, viz. Special Civil Suit no. 637 of 2000, while filing compromise purshis in the second suit, viz. Regular Civil Suit no. 535 of 2003.
17. The original owner respondent no.4 who was defendant no.1 in both the suits, thus, entered into compromise fraudulently in order to frustrate the rights of the State Government over the parcel of land which was declared as surplus, as also the rights of the original petitioner Page 12 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined society for the lands purchased by it in the year 1985.
18. These turn of events for dealing with one piece of land by filing two suits wherein the original owner was party as defendant no.1, by compromise purshis fraudulently filed, could not be disputed before us. The fact remains that the defendant no.1 in the aforesaid two suits viz. Pratapsinh Dahyabhai Parmar, (respondent no.4 in the original petition) had left with no right, title or interest in the land in question being Revenue survey no. 650 admeasuring 5261 sq. mtrs. out of which 3861 sq. mtrs. land was declared as surplus and vested in the State Government, while remaining 1440 sq. mtrs. land was sold in favour of the petitioner society through power of attorney Ranjikant Jashbhai Brahmbhatt by executing the two sale deeds dated 10.11.1985.
19. It is an admitted fact of the matter that the Sale Deeds dated 10.11.1985 executed in favour of the petitioner society are registered sale deeds and are surviving as on date as valid documents. No proceedings under the Tenancy Act have been initiated by the revenue authority. The original owner viz. respondent no.4 has never challenged the existence or the validity of the sale deeds by drawing any proceedings before any competent court of law.
20. During the existence of the registered sale deeds, whereby the right in the land in question, viz. Survey No. 650 area 1440 sq. mtrs. was transferred to the petitioner Society, both the consent decrees dated 24.08.2000 and Page 13 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined 17.05.2003 in two suits filed by the third parties against the original owner, namely respondent no.5 claiming declaration of their independent right without impleading the petitioner society and the State Government, would be an outcome of fraud played by the original owner, viz. the respondent no.4 with the aid and assistance of the third parties.
21. As noted hereinbefore, while the recall application filed by the petitioner society was pending seeking recall of the consent decree dated 24.085.2000 passed in the first suit, the second suit was filed and a consent decree was obtained within a period of two days on a compromise purshis. After the consent decree dated 17.05.2003 was passed in the second suit, viz. Regular Civil Suit No. 538 of 2003, the recall application filed by the petitioner society was dismissed on 17.09.2003 on the ground of being devoid of merits.
22. From the above turn of events, we may also note that we have serious doubts about the functioning of the Court, which has passed the decrees dated 24.08.2000 and 17.05.2003 on the basis of the compromise purshis and further rejected the recall/review application on 17.09.2003. However, as more than 20 years have passed by, we cannot initiate any inquiry into the manner in which the consent decrees were passed.
23. However, as noted by the learned Single Judge in light of the reports, as directed in the order dated 22.02.2004, submitted by the Senior Civil Judge and the District Page 14 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined Collector, Vadodara, we find that in the fitness of things, no interference is called for in the order of the learned Single Judge.
24. However, before reaching at a final conclusion in the matter, we may deal with the submissions of the learned Senior counsel appearing for the appellant on the maintainability of the petition under Article 226/227 of the Constitution of India wherein the consent decrees passed by the Civil Court has been quashed and set aside.
25. Shri Mehul H. Shah, learned Senior advocate for the appellant would vehemently argue that the suit filed by the appellant-respondent no.7, namely Regular Civil Suit No.535 of 2003 was only with respect to the retainable land with the original owner-respondent no.4 who was party to the suit. The sale deed in favour of the petitioner Society was executed by the power of attorney of respondent no.4, whose stand before the learned Single Judge was that the transaction can be held to be illegal being in breach of Section 63 of the Bombay Tenancy And Agricultural Lands Act, 1948. The consent decrees dated 17.05.2003 having been passed by the competent court of law, the High Court under Article 226/227 of the Constitution of India cannot be said to be justified in setting aside the decree. The decree remain alive being a judicial decree till it is set aside by the competent court of law in an appropriate proceeding.
26. Order XXIII Rule 3 CPC has been read over to submit Page 15 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined that the Court passing consent decrees dated 17.05.2003 was completely justified to record the consent terms and on the satisfaction recorded by it, the decree was passed in accordance with the said provision. Proviso to Rule 3 of Order XXIII clearly says that in a case where one party alleges satisfaction or adjustment of rights and another denies the same, the Court shall decide the question. Explanation to Rule 3 Order XXIII further categorically states that an agreement or a compromise, which is void and voidable under the Indian Contract Act, 1872 shall not be deemed to be lawful within the meaning of this Rule.
27. The validity of a consent decree depends wholly on the legal validity of the agreement on which it rests. A compromise entered into between the parties in the suit is recorded in writing and signed by the parties. The result is that only option before the petitioner society was either to seek recall of the decree by approaching the same Court passing the compromise decree or file a separate suit wherein the plea of fraud has to be established by leading evidence. Only the Court which has passed the compromise decree can look to the correctness of the compromise, in case there is a challenge to the legal validity of the compromise on which it rests. Even no separate suit is maintainable in view of the bar of Rule 3A of Order XXIII.
28. Placing Section 96(3) of the Code of Civil Procedure, it was vehemently submitted by the learned Senior counsel Page 16 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined that even no appeal shall lie from a decree passed by the Court with the consent of the parties. The allegation of fraud is a matter of inquiry into the questions of facts and the only option before the petitioner was to approach the same court to seek recall or setting aside of the compromise decree. Reliance is placed on the decisions of the Apex Court in Sadhana Lodh v. National Insurance Co. Ltd. [(2003) 3 SCC 524], Horil v. Keshav [(2012) 5 SCC 525], Virudhunagar Hindu Nadargal Dharma Paribalana Sabai v. Tuticorin Educational Society [(2019) 9 SCC 538], Triloki Nath Singh v. Anirudh Singh [(2020) 6 SCC 629], Shree Surya Developers and Promoters vs. N. Shailesh Prasad & Ors. [(2022) 5 SCC 736] and the Full Bench decision of this Court in Sakina Sultanali Sunesara (Momin) v. Shia Imami Ismaili Momin Jamat Samaj [2019 SCC OnLine Guj 7042], to submit that even no suit shall lie to set aside the decree passed under Rule 3 of Order XXIII on the ground that the compromise on which the decree is passed was not lawful in view of the bar contained in Rule 3A of Order XXIII. The only remedy available to the aggrieved party against the consent decree is to file an application under the proviso to Rule 3 of Order XXIII of disputing such compromise.
29. In a case where the aggrieved party was not the party to the suit, the remedy available to him to challenge the decree passed by the Court on the basis of the compromise between the parties to the suit (consent Page 17 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined decree), would be to file an appeal under Section 96(1) of CPC with the leave of the appellate court or to file a review application before the Court, which passed the decree as may be permissible under Section 114 read with Order XLVII of CPC.
30. It was vehemently argued that the recourse available to the petitioner society to challenge the decree passed by the competent civil court on the basis of which the compromise between the parties (consent decree) was either to file an application under the proviso to Rule 3 of Order XXIII CPC disputing such compromise; or to file an appeal under Section 96(1) CPC with the leave of the Court; or to file a review application before the Court, which passed the decree on the basis of the compromise, as may be permissible under Section 114 read with Order XXIII CPC. There is no other remedy available in law and moreover, from any angle, the petition under Article 226/227 challenging the compromise decree was not maintainable.
31. The learned Senior counsel has further proceeded to address the Court on the issue of validity of the sale deeds executed in favour of the Society by submitting that on the date of execution of the sale deeds, the Society was not in existence. The execution of the sale deeds is doubtful, inasmuch as, in the document of registration of the society in the year 1990, at page '44' of the paper book, various survey numbers are mentioned, but the land in dispute is not indicated Page 18 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined therein.
32. Lastly, it was argued that in the report of the Civil Judge, submitted in compliance of the order passed by this Court, it is clearly stated that the appellant has not committed any fraud in obtaining the compromise decree. The fraud, if any, has been committed by the original owner, viz. respondent no.4.
33. The prayers in the Writ petition are for correction of the revenue records by deleting the entries in the name of the petitioner and setting aside of the consent decrees passed by the competent court of law dated 24.08.2000 and 17.05.2003 holding the same to be fraudulent compromise without authority. The contention is that obtaining compromise decree by fraudulent means and the fraud committed in obtaining such decree are not interchangeable and, moreover, the fraud alleged, if any, would also be covered by order XXIII Rule 3 CPC where the aggrieved person challenging the compromise decree has to approach the same court, which has passed the decree. It was, thus, vehemently argued that the decision of the learned Single Judge cannot be sustained in the eye of law.
34. The learned counsel for the respondent/original petitioner society in rebuttal, has relied upon the decision of the Apex Court in State of U.P. v. Ehsan [2023 SCC OnLine SC 1331] to submit that existence of an alternative remedy is not an absolute bar on the exercise of writ jurisdiction. More so, when a writ Page 19 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined petition has been entertained in the year 2004, parties have exchanged their pleadings/affidavits and the matter has remained pending for long, it would not be justifiable to relegate the Writ petitioner to the alternative remedy unless there are compelling reasons to do so. There is no dispute between the parties on the question of fact and material/evidences available on record to enable the Writ court to come to a definite conclusion. There is, thus, no justification to turn down the Writ petition on the only plea that the Writ petitioner has an alternative remedy when no disputed questions of fact remained to be adjudicated.
35. Considering the rival submissions of the learned counsels for the parties, as noted hereinbefore, we may note, at the outset, that the present appeal has been filed only by one person who was impleaded as respondent no.7 in the original Writ petition and who is a party to the compromise decree dated 17.05.2003 passed in Regular Civil Suit No. 358 of 2003. The other respondents in the Writ petition including the original owner impleaded as respondent no.4 have not come forward to challenge the decision of the learned Single Judge.
36. As noted hereinbefore, the decree dated 17.05.2003 was obtained by the appellant herein in connivance with the respondent no.4 by filing the second suit Regular Civil Suit No. 538 of 2003, while recall application filed by the petitioner Society, seeking for recall of the consent Page 20 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined decree dated 24.08.2000 was pending in the same Court. After the consent decree, the recall application filed by the petitioner Society was dismissed on 17.09.2003. The consent decree dated 17.05.2003 was passed in a suit filed by the appellant herein seeking for declaration on the ground of adverse possession that too when the respondent no.4 had already parted away his right in the suit property by executing sale deeds in favour of the petitioner society, much prior to the institution of the Suit. It is evident from the record that the compromise decree has been obtained by the appellant respondent no.7 in connivance with the respondent no.4-original owner who had kept silent about the first decree dated 24.08.2000, as also the pending recall application filed by the petitioner society on the date when the Regular Civil Suit No. 538 of 2003 was instituted.
37. There is no doubt about the fact established from the record that the compromise decree dated 17.05.2003 in Regular Civil Suit No. 538 of 2003 filed by the respondent no.7 is a result of fraud played by the respondent no.4, the original owner in connivance with the appellant herein in order to frustrate the right of the petitioner society in the land in question, viz. Survey No. 650 area 1440 sq. mtrs. The fact that the suit filed by the appellant herein was pertaining to an area of 1440 sq. mtrs. of retainable land of Survey no. 650 held in favour of the respondent no.4 (original owner) would of no consequence, inasmuch as, the respondent no.4 had left with no right, title or interest in the land in question Page 21 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined after execution of the sale deeds in favour of the petitioner society in the year 1985.
38. The submission of the learned senior counsel for the appellant to address on the validity of the sale deed executed in favour of the petitioner society do not impress us for the simple reason that there is no answer to the question that the sale deeds executed by the respondent no.4 in favour of the respondent society are valid documents as they have not been declared void or voidable by any court of law. There is no challenge to the validity of the sale deeds executed by the power of attorney of the original owners. The submission of the original owner before the Writ court that the sale deed is hit by Section 63 of the Tenancy Act is neither here nor there.
39. Taking note of the above, we do not find any substance in the arguments of the learned senior counsel for the appellant about the availability of alternative remedy to the Writ petitioner viz. respondent society herein.
40. On the issue of fraud, as rightly noted by the learned Single Judge, the position of law is well settled. It is trite in law that a judgment or decree obtained by playing fraud on the Court is a nullity and nonest in the eye of law. Such a judgment/decree either 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.
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41. The Apex Court in the case of S.P. Chengalvaraya Naidu v. Jagannath [(1994) 1 SCC 1], has held that the "finality of litigation" cannot be pressed to the extent of such an absurdity that it becomes an engine of fraud in the hands of dishonest litigants. The courts of law are meant for imparting justice between the parties. One who comes to the court, must come with clean hands. A person whose case is based on falsehood has no right to approach the court. He can be summarily thrown out at any stage of the litigation.
42. It has been held therein by the Apex Court that the High Court has fell into a patent error in not addressing the question before it as to whether the preliminary decree was obtained by playing fraud on the court, in the facts and circumstances of the said case. It was observed that fraud is an act of deliberate deception with the design of securing something by taking unfair advantage of another. It is a deception in order to gain by another's loss. It is a cheating intended to get an advantage. The Apex Court observed that :-
"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 eyes 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."
(para 1) Page 23 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined
43. We also may note the law laid down by the Apex Court in Ganpatbhai Mahijibhai Solanki v. State of Gujarat [(2008) 12 SCC 353], wherein it was observed that :-
"19. It is now a well-settled principle that fraud vitiates all solemn acts. If an order is obtained by reason of commission of fraud, even the principles of natural justice are not required to be complied with for setting aside the same.
20. In T. Vijendradas v. M. Subramanian [(2007) 8 SCC 751 : (2007) 12 Scale 1] this Court held: (SCC p. 766, paras 27-28) "27[21]. ... When a fraud is practised on a court, the same is rendered a nullity. In a case of nullity, even the principles of natural justice are not required to be complied with. (Kendriya Vidyalaya Sangathan v. Ajay Kumar Das [(2002) 4 SCC 503 : 2002 SCC (L&S) 582] and A. Umarani v. Registrar, Coop. Societies [(2004) 7 SCC 112 : 2004 SCC (L&S) 918] , SCC para 65.) 28[22]. 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 nullity, in our opinion, it would be wholly inequitable to confer a benefit on a party, who is a beneficiary thereunder."
44. The principles noted hereinabove have been reiterated with approval in K.D. Sharma v. SAIL [(2008) 12 SCC 481] :-
"26. It is well settled that "fraud avoids all judicial acts, ecclesiastical or temporal" proclaimed Chief Justice Edward Coke of England about three centuries before. Reference was made by the Page 24 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined counsel to a leading decision of this Court in S.P. Chengalvaraya Naidu v. Jagannath [(1994) 1 SCC 1] wherein quoting the above observations, this Court held that a judgment/decree obtained by fraud has to be treated as a nullity by every court.
27. Reference was also made to a recent decision of this Court in A.V. Papayya Sastry v. Govt. of A.P. [(2007) 4 SCC 221] Considering English and Indian cases, one of us (C.K. Thakker, J.) stated:
(SCC p. 231, para 22) "22. It is thus 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 the law. Such a judgment, decree or order--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."
The Court defined "fraud" as an act of deliberate deception with the design of securing something by taking unfair advantage of another. In fraud one gains at the loss and cost of another. Even the most solemn proceedings stand vitiated if they are actuated by fraud. Fraud is thus an extrinsic collateral act which vitiates all judicial acts, whether in rem or in personam."
45. In a recent decision in the Ram Kumar v. State of U.P. [2022 SCC OnLine SC 1312], it was observed that :-
"28. This Court, in the case of S.P. Chengalvaraya Naidu (Dead) By LRs. v. Jagannath (Dead) by LRs8 has held that non-disclosure of the relevant and material documents with a view to obtain an undue advantage would amount to fraud. It has been held that the judgment or decree obtained by fraud is to be treated as a nullity. We find that respondent No. 9 has not only suppressed a material fact but has also tried to mislead the High Court. On this ground also, the present appeal deserves to be Page 25 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined allowed."
46. In light of the law stated hereinabove, we do not find any good ground to interfere in the opinion drawn by the learned Single Judge that the consent decree dated 17.05.2003 in Regular Civil Suit No. 358 of 2003 filed by the appellant herein was a result of fraud and is to be treated as nullity.
47. We may further note that the instant appeal before the Division Bench within the meaning of Clause 15 of the Letters Patent is against the exercise of discretion by the learned Single Judge. The law as stated in Wander Ltd. And Anr. vs Antox India P. Ltd. [1990 SUPP SCC 727] and reiterated in a recent decision of the Apex Court in Shyam Sel & Power Ltd. v. Shyam Steel Industries Ltd. [(2023) 1 SCC 634] is that in such appeals, the appellate court will not interfere with the exercise of discretion of the court of first instance (learned Single Judge herein) and will not substitute its own discretion except where the discretion has been shown to have been exercised arbitrarily, or capriciously or perversely or where the court had ignored the settled principles of law in the exercise of discretion.
48. It was noted in Wander Ltd. (supra) that an appeal against exercise of discretion is said to be an appeal on principle. The appellate court will not reassess the material and seek to reach a conclusion different from the one reached by the court below if the one reached by Page 26 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024 NEUTRAL CITATION C/LPA/609/2023 JUDGMENT DATED: 05/12/2024 undefined that court was reasonably possible on the material. The appellate court would normally not be justified in interfering with the exercise of discretion under appeal solely on the ground that if it had considered the matter at the first stage it would have come to a contrary conclusion. If the discretion has been exercised by the trial court reasonably and in a judicial manner the fact that the appellate court would have taken a different view may not justify interference with the exercise of jurisdiction by the learned Single Judge. The law as to the reversal by a court of appeal of an order made by a learned Single Judge in the exercise of his jurisdiction is well established. It was held in Shyam Sel & Power Ltd. (supra) that the approach of the Division Bench of the High Court was totally unwarranted and uncalled for when it was not even observed as to how the discretion exercised by the learned Single Judge can be said to have been exercised arbitrarily, capriciously or perversely.
49. In light of the above discussion, we are not impressed by the arguments of the learned senior counsel appearing for the appellant. No case is made out for interference in the discretion exercised by the learned Single Judge in holding the consent decree as a nullity and resultantly setting aside the same.
50. The appeal is, thus, dismissed being devoid of merits. No order as to costs.
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(SUNITA AGARWAL, CJ ) (PRANAV TRIVEDI,J) BIJOY B. PILLAI Page 28 of 28 Uploaded by BIJOY B. PILLAI(HC00202) on Tue Dec 17 2024 Downloaded on : Fri Dec 20 22:26:10 IST 2024