IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) SATURDAY, THE THIRTIETH DAY OF APRIL TWO THOUSAND AND ELEVEN :: PRESENT :: THE HONOURABLE SRI JUSTICE B.PRAKASH RAO AND THE HONOURABLE SRI JUSTICE SANJAY KUMAR W.A.No.1560 of 2002 And W.P.No.680 of 2003 Between M/s Viva Granites, Cheemakurthy village Cheemakurthy Mandal, Prakasam district Represented by its Production Manager Sri K. Parthasarathy S/o K. Narayan Rao APPELLANT AND 1. The Government of Andhra Pradesh represented by its Secretary, Industries & Commerce Department, Secretariat, Hyderabad 2. The Director of Mines & Geology, Hyderabad 3. The Dy. Director of Mines & Geology, Guntur 4. The Asst. Director of Mines & Geology, Ongole 5. M/s Rainbow Exporters represented by its proprietor H.No.7/315, Ongole-Kurnool main road, Cheemakurthy, Prakasam District 6. K.C. Chandran S/o Chinnappa Setty, R/o 67 Aspirian Gardens, Killpauk, Chennai RESPONDENTS THE HONOURABLE SRI JUSTICE B.PRAKASH RAO AND THE HONOURABLE SRI JUSTICE SANJAY KUMAR W.A.No.1560 of 2002 And W.P.No.680 of 2003 COMMON JUDGMENT: This Appeal under clause 15 of the Letters Patent arises against the order passed by the learned Single Judge, dated 28-08-2002 passed in W.P.No.18643 of 2000. The Writ Petition No.680 of 2003 is filed assailing the transfer of the land to respondent No.7 by the respondents 5 and 6, who are same respondents in the W.P.No.18643 of 2001 in W.A.No.1560 of 2002, while the W.P.No.18643 of 2001 was pending. The result in W.P.No.680 of 2003 mainly depends upon the out come of the decision of the W.A.No.1560 of 2002. There are apparently similar and identical facts in both the mattes. Therefore, in the interest of justice both the matters are taken up together for disposal. Coming to the factual matrix, most of the facts are not in dispute, namely on 09-10-1991 the respondent No.5 filed an application before the respondent No.2, Director of Mines for grant of Quarry Lease over an extent of Ac.3.20 gts in Sy.No.975/4 & 5 of Cheemakurthy Village Mandal, Prakasam District, Andhra Pradesh. The said application was rejected by respondent No.2 as deemed rejection. On such rejection, the respondent No.5 (Proprietor Soundrayapandyam) filed the revision before the Government on 09-04-1992 and the same was dismissed on the ground the revision was time barred, as per Memo No.628/DM.II/92-1 on 16-04-1992. Later, on 22-01-1994 the Writ appellants have filed an application before the respondent No.2 for grant of quarry over the land in the same Sy. No. 975/4 of Cheemakurty Village on the basis that it is a government land. On 11-08-194 after delay of 2 years 4 months while the application of the writ appellant (Viva Granites) is pending before the respondent No.2 for grant of Quarry Lease. The respondent No.6 based on a G.P.A given by the respondent No.5, on 06-09-1993 filed Writ Petition No.14776/94, seeking a direction to treat the revision order passed by the 1st respondent as time barred is illegal. While so, Writ appellant (Viva Granites) has field W.P.No.19578 of 1996 to declare the action of the respondent No.2 in not disposing the application filed by him on 22-01-1994 as illegal. This Court had passed an order dated 18-07-1996 directing the respondent No.2 to consider and dispose of the application of the appellant dated 22-01- 1994 for grant of Quarry Lease within 8 weeks from the date of receipt of the order. On 09-12-1996 another Writ in W.P.No.26427 of 1996 was filed by the K.C.Chandran (respondent No.6), G.P.A Holder on behalf of the respondent No.5 for not considering their application dated 09-10- 1991 for grant of Quarry Lease. Both the Writs W.P.No.26427 of 1996 and W.P.No.14776 of 1994 were heard together and as per order on 27-01-1997 directed the respondent No.2 to consider the application dated 09-10-1991 in W.P.No.26427 of 1996 with in a period of three months while holding other Writ W.P.No.14776 of 1994 as infructuous. The writ appellant filed another W.P.No.13746 of 1997 seeking the Court to direct the respondent No.2 to consider the application for grant of the Quarry Lease within a reasonable time and it was disposed off by this Court on 01-07-1997 by directing the Respondent No.1 to 4 to consider the application for grant of Quarry lease of the writ appellant (Viva Granites), dated 22-01-1994 within a period of 6 weeks. On 07-07-1997, the respondent No.2 granted lease to M/s. Rainbow Exports, in proceedings No.3361/Q3(2)/1996. Aggrieved by it the present writ appellant filed W.P.No.16717 of 1997 on 23-07-1997 against the said proceedings and obtained interim stay on 24-07- 1997. It appears that certain disputes were cropped up between respondent No.5 (Soundraya Pandayan) and respondent No.6 (K.C.Chandran), which culminated in filing a suit by the respondent No.5 in O.S.No.371 of 1998, on the file of District Court at Ongole, making the respondent No.2 and 6 as parties, seeking a direction on the respondent No.6 not to carry on any quarrying or sale or export of granite of said disputed land (Sy.No.975/4 & 5 of Cheemakurthy Village) alleging that the respondent No.6 is not maintaining the accounts properly disclosing the fact of execution of the G.P.A dated 06-09-1993 and its cancellation on 10-10-1995. Armed with the order of lease granted by the respondent No.2, the respondent No.6 filed review WPMP.No.1255 of 1999 to review the order passed in W.P.No.14776 of 1994 on 27-01-1997 treating as infructuous, since suppressing the fact of passing an order already by respondent No.2 granting the lease in favour of respondent No.6. It appears that without knowing the fact that the respondent No.2 already considered the case of the respondent No.6, this Court quashed the government order dated 16-04-1992 by setting aside the order dated 27-01-1997 thereby directing the respondent No.2 to consider the application dated 09-06-1991 in accordance with law and on merits. It was further submitted that the respondent No.6 (K.C.Chandran) sought to get the stay orders vacated in W.P.No.16717 of 1997 by filing WVMP.No.3383 of 2000 on 07-12-2000. The said W.P.No.16717 of 1997 along with Writ Vacate petition No.3383 of 2000 was disposed of on 21-12-2000 by this Court directing to file a revision before the Government with in four weeks from the date of disposal. Since, the appellant came to know the fact of respondent No.6 cancellation of his G.P.A by respondent No.5 long back as in the year 10-10-1995, a review WPMP.No.1078 of 2000 on 27-12-2000 in W.P.No.16717 of 1997 was filed as this was not known to the appellant counsel when the W.P.No.16717/1997 came up for hearing. However, during the pendency of the review WPMP.No.1078 of 2000 that writ appellant filed the revision before the respondent No.1 on 23-01-2001 with a short delay of 4 days. When the review WPM.P.No.1078 of 2000 came up for hearing, due to the fact of filing Revision before the Government, it was disposed off on 19-06-2001 by directing the respondent No.1 to consider the matters raised in review. Thereupon, the Revisional Authority (respondent No.1) had dismissed it as time barred, 2) Director had no powers to grant the lease through proceedings No.3361/Q3(2)/1996 on 07-07-1997 as the application of Respondent No.5 was deemed rejected and his revision was dismissed by none other than his superior authority the Government (Respondent No.1) 3) knowledge about Respondent No.6 G.P.A cancellation 4) Completely failed to see that there is no such new rule under which the Director treated the 5th respondent’s application dated 09-10-1991 takes preference over the Writ Appellant application dated 07-02-1994 or at least failed to state or mention the new rule or quote the details under which the Director considered the application of the respondent No.5 stands in priority over the Writ Appellant 5) Sufficiently failed to see that Revenue Divisional Officer in his report D/6532/94 dated. 23-12- 1994 has categorically stated that subject matter of land is an assigned land and the same was resumed by the Mandal Revenue Officer and it is under the control of the Government. 6) exclusively failed to see that the District Collector recommended to grant the lease in favour of the Appellant on 08-02-1996, while ignoring the recommendation of the Dy. Director (Respondent No.3) grant of lease should be considered as the government land 8) As against the fraud played with the Court by suppressing the facts in the Court 9) For accepting the notarized affidavit from the respondent No.5 transferring the proprietorship to respondent No.6. It is to be noted that Writ Petition No.18643 of 2001 filed by the Writ Appellant challenging the order of the respondent No.1 was dismissed without assigning any reasons and findings on the above facts and circumstances. The learned Senior Counsel Sri E.Manohar appearing for respondent No.6 while supporting the order passed by the single Judge mainly contends that the appellant failed to prove the fraud by way of pleading and failing to file the revision within 4 weeks as per the opportunity accorded to him by the orders in W.P.No.16717 of 1997. Having heard the counsel in detail and perusing the entire material, the points which arise for consideration are: 1. Whether on the facts and circumstances the order dismissing the Writ in W.P.No.18643 of 2001 is correct? 2. Whether the respondent No.6 played fraud with the Court? 3. Whether the appellant failed to file the revision in time as contended by the respondent No.6? Inasmuch as the sum and substance found by the learned single judge was that though the respondent No.5’s application was rejected under the old rules but the said application was considered under new rules and there is no illegality in transferring the proprietorship by way of notarized affidavit from respondent No.5 to Respondent No.6 during the course of hearing of the revision by the respondent No.1. The respondent No.2, considered the application of the respondent No.5 pursuant to the orders of this Hon’ble High Court, dated 27-01-1997 in writ petition No.26427/1996. On examining the rival contentions of both the parties, we are of the considered view that no point of time the respondents cited or stated in their counter or taken us to the provisions of law about the new rules under which the respondent No.1 has power to consider the case. We see force in the argument by the learned counsel Sri Subba Reddy on behalf of the appellant submits that it is impermissible to effect transfer on the notarized affidavit as per the rule provision Rule 12(5), which reads as, “The licensee or lessee shall not assign, sub-let, transfer or otherwise dispose of the under license or lease without obtaining the previous sanction in writing of the Director. The transfer application shall be made to the Assistant Director of the District concerned in Form R along with non-refundable application fee of Rs.5,000/- (Rupees five thousand only). The license or lease deed shall be executed as per the provision under clause (c) provided that such sanction shall be accorded that there is no speculation involved in the transfer of license or lease.” Thus the rule is very clear that no such transfer based on mere Notarized Affidavit is permissible under the rules. The single judge appears to have heavily placed reliance on major element in respect of third aspect that the lease was considered pursuant to orders of this Hon’ble Court. On perusing the order of the said writ petition, we found that this Hon’ble Court directed to consider the application within three months. It cannot be a positive direction in favour, without considering the merits and in accordance with law. The learned single Judge failed considering that the government (respondent No.1) completely ignored deliberatively the fact of the application, dated 09-10-1991 was dismissed by themselves on 16-04- 1992 while considering the revision filed by the appellant against the orders passed by the respondent No.2 through proceedings 3361/Q3(2)/96, dated 07-07-1997, though it is quite apart that the order passed by the government, dated 16-04-1992 was quashed in Rev W.P.No.1255/1999. As pointed out, the learned single Judge sufficiently failed to consider the fact against the finding that NOC issued by the M.R.O. was validated by the Collector. On perusal of the material available, we find that Collector have treated the land as government land and recommended to allot the same to the appellant through proceedings No.R.Dist.B3/6004/95, dated 08-02-1996, so was the deputy director through Lr.860/02/96, dated 22-11-1996. Therefore, in view of these reasons, it cannot be said that the writ is liable to be dismissed. It is a well established principle that fraud vitiates everything. Similarly, the judgment or decree obtained by playing fraud on the Court is a nullity and nonest in the eyes of law. On hearing the rival contentions of both the parties, we observed that the respondent No.5 granting GPA to respondent No.6 on 06-09-2003 was cancelled on 10- 10-1995 and the same was pleaded by the respondent No.5 himself in a suit filed in O.S.No.371/1998 in the District Court of Ongole. The learned single Judge while considering the writ petition observed that the cancellation of GPA was an internal matter in between the respondent Nos.5 and 6 which is to be settled among themselves. In our considered opinion it is not so. It certainly will have an impact legally which cannot be overlooked nor it can be said of a case of no logical consequence in law. It is shows that the respondent No.6 knew very well that the order passed by the respondent No.2 on 07-07-1997 is invalid because the respondent No.1 have dismissed his revision on 16-04-1992 and yet filed review W.P.M.P.no.1255/1999 on 19-01-1999 against the order passed in the year 27-01-1997 in W.P.No.14776/1994. This court unaware of the said fact of respondent No.2 granting the lease on 07- 07-1997 quashed the Government order, dated 16-04-1992 and set aside the order passed in the year 27-01-1997 in W.P.No.14776/1994 paving the way for the said decision from the respondent No.1. Further the respondent No.6 knew that the interim orders passed in W.P.No.16717/1997 against the orders of respondent No.2 granting lease on 07-07-1997 in favour of respondent No.5 and he filed a vacate stay petition No.3383/2000 on 07-12-2000 and mislead the court by stating that the respondent No.2 had considered his application because the government order was quashed, when the truth is the respondent No.2 considered the lease long back i.e., on 07- 07-1997 prior to the quashing of the government order. It is pertinent to mention that the government order, dated 16-04-1992 was quashed only in Rev. W.P.M.P.No.1255/1999 on 19-01-1999. The counter affidavit in W.V.M.P.No.3383/2000 and Rev. W.P.M.P.No.1255/1999 are not amply reflects the magnitude. The respondent No.6 did not bring to the notice of the Court the factum of respondent No.2 considering the lease prior to filing the Rev. W.P.M.P.No.1255/1999 or at least at the time of hearing in W.V.M.P.No.3383/2000 in W.P.No.16717/1997 the respondent No.2 granting the lease prior to getting the government order, dated 16-04-1992 quashed. It could have avoided the multiplicity of proceedings. On analyzing and examining the available material, as alleged by the appellant specifically the fraud in the affidavit filed by the appellant in W.P.No.18643/2001, the same is writ large. In CHENGALVAAYA NAIDU v. JAGANATH [1], the Supreme Court held that: “The Courts of law are meant for imparting justice between the parties. One who comes to the Court, must come with clean hands. We are constrained to say that more often than not, process of the Court is being abused. Property-grabbers, tax-evaders, bank-loan- dodgers and other unscrupulous persons from all walks of life find the court-process a convenient lever to retain the illegal gains indefinitely. We have no hesitation to say that a person, who’s case is based on falsehood, has no right to approach the Court. He can be summarily thrown out at any stage of the litigation.” In HAMZA HAJI v. STATE OF KERALA AND ANOTHER [2], the Supreme Court held while relying the decision rendered by the Full bench of the Bombay High Court in Guddappa Chikkappa Kurbar V. Balaji Ramji Dange, observed that: “No Court will allow itself to be used as an instrument of fraud, and no court, by the application of rules of evidence or procedure, can allow its eyes to be closes to the fact that it is being used as an instrument of fraud.” In Hip Foong Hong V. H. Neotia and Co., the Privy Council held that if a judgment is affected by fraudulent conduct it must be set aside. In R. v. Recorder of Leicester, it was held that a certiorari would lie to quash a judgment on the ground that it has been obtained by fraud. The basic principle obviously is that a party who had secured a judgment by fraud should not be enabled to enjoy the fruits thereof. In A.V. PAPAYYA SASTRY v. GOVT. OF A.P. [3], the Hon’ble Supreme Court held: Now, it is well-settled principle of law that if any judgment or order is obtained by fraud, it cannot be said to be judgment or order in law. Before three centuries, Chief Justice Edward Coke proclaimed: “Fraud avoids all judicial acts, ecclesiastical or temporal.” 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 nonest 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. In the leading case of LAZARUS ESTATES LTD. v. BEASLEY LORD DENNING (ALL ER p. 345 C) observed: “No judgment of a court, no order of a Minister, can be allowed to stand if it has been obtained by fraud.” In Duchess of Kingstone, Smith’s Leading Cases, 13th Ed., P.644, explaining the nature of fraud, de Grey, C.J. stated that though a judgment would be res judicata and not impeachable from within, it might be impeachable from without. In other words, though it is not permissible to show that the Court was “mistaken” it might be shown that it was “mislead”. There is essential distinction that an action to set aside a judgment cannot be brought on the ground that it has been decided wrongly, namely, that on the merits, the decision was one which should not have been rendered, but it can be set aside, if the Court was imposed upon or tricked into giving the judgment. I n PRESTIGE LIGHT LTD v. STATE BANK OF INDIA [4], the Supreme Court held that: “It is well settled that a prerogative remedy is not a matter of course. In exercising extraordinary power, therefore, a writ court will indeed bear in mind the conduct of the party who is invoking such jurisdiction. If the applicant does not disclose full facts or suppress relevant materials or is otherwise guilty of misleading the court, the Court may dismiss the action without adjudicating the matter. The rule has been revoked in larger public interest to deter unscrupulous litigants from abusing the process of court by deceiving it. The very basis of the writ jurisdiction rests in disclosure of true, complete and correct facts. If the material facts are not candidly stated or are suppressed or are distorted, the very functioning of the writ courts would become impossible.” In WELCOME HOTEL v. STATE OF A.P. [5], the Supreme Court held that the party which mislead the Court in passing the order in its favour is not entitled to be heard on the merits of the case. Therefore, in view of the above considerations, we are of the view that the respondent No.6mislead the Court and suppressed the material facts. In regard to the directions to the appellant to file the revision before the respondent No.1 within 4 weeks from 21st day of December, 2000, it is seen that upon passing the order in writ petition No.16717/1999, the appellant filed a review writ petition No.1078/2000 on the ground that the GPA of respondent No.6 was cancelled by respondent No.5. However, when the matter came up for hearing, it was brought to the notice of the court that revision petition was already filed and the same is posted for hearing on 23-06-2001. Hence, this Court taking into consideration that revision was filed it directed the respondent No.1 to consider and dispose expeditiously. Therefore, it is a fact that it was filed after the 4 weeks period fixed by him. Moreover keeping in view of the above aspects, the question of limitation does not arise or find its place. In writ petition No.680/2003, the sole contention is that the land in question was transferred in favour of respondent No.7 in writ petition No.680/2003 which is against the rules laid down in 12(5) VIII and that such transfer is impermissible in law. On the other hand, the learned counsel appearing for respondent No.7 contends that they have invested huge amounts of money, therefore, their case should be considered leniently. We are unable to agree that the amounts invested in quarrying the land would protect their interest as the order of transfer itself reflect clearly that the transfer of lease was granted subject to the result to the writ petition No.18643/2001 investing the money in the said project by the respondent No.7 is nothing but, taking the risk knowingly that in case if the matter pending in the Court turns out to be unsuccessful the respondent No.7 will surely loose amounts. Therefore, we feel that the amounts are invested knowingly that the writ petition No.18643/2001 was pending and investing in such case would amounts to taking the risk. In the circumstances, we hereby allow the appeal and the writ petition directing the respondents 1 to 4 to take necessary action to stop the quarrying operations of the respondent No.7 in W.P.No.680/2003 and handover the same on following due process of law within one month from the date of receiving a copy of this order. No order as to costs. _________________ B. PRAKASH RAO, J ________________ SANJAY KUMAR, J Date:30-04-2011 grk+ycr [1] 1994 (1) SCC 1 [2] 2006 (7) SCC 416 [3] 2007 (4) SCC 221 [4] 2007 (8) SCC 449 [5] 1983 (4) SCC 575