*THE HONOURABLE SRI JUSTICE GHULAM MOHAMMED +SA No.749 of 2009 and batch % 13-08-2010 # V. Savitramma ( died ) per L.Rs, ….petitioner Vs. $ The Addl. Commissioner of Industries and Special Officer, Visakhapatnam, and others …. Respondents !Counsel for the petitioner : Counsel for the Respondents: <Gist : >Head Note: ? Cases referred: THE HON’BLE SRI JUSTICE GHULAM MOHAMMED SA Nos.749,779 797,798,799,800,803,804,805,,806,807, 808,839,840,843,844,845,846,847,848,849,850,851,852,853,857,858,860,861,905,90 of 2009 THE HON’BLE SRI JUSTICE GHULAM MOHAMMED SA.Nos.749,779,797,798,799,800,803,804,805,,806,807, 808,839,840,843,844,845,846,847,848,849,850,851, 852,853,857,858,860,861,905,909,917,918 of 2009 Common judgment: The subject matter of dispute in all these appeals pertains to issuance of Rehabilitation Cards ( R-Cards), which is said to be a beneficial provision provided to the displaced persons, consequent on the acquisition of the land for the purpose of laying railway line for Visakhapatnam Steel Plant, and as such they are clubbed, heard together and are being disposed of by this common judgment, at the request of both the counsel. For the purpose of convenience, the parties are referred to as arrayed before the trial Court in O.S.No.867 of 2001 and the facts in S.A.No.779 of 2009 are adverted to: O.S.No.867 of 2001 was filed for declaration that the proceedings of the 1st defendant in R.C.No.1140/90/R2 dated 26.10.1993 as illegal, improper and arbitrary and for consequential injunction restraining the defendants from taking any further action in pursuance of the above proceedings. It is inter alia alleged by the plaintiff that the family property of the plaintiff consisting of the land and building in S.No.19/B/3K in Gopalapatnam, Visakhapatnam was acquired by the Government for laying Railway lane for the benefit of the 3rd defendant, that award enquiry was conducted and compensation was granted. As per the policy of the Government, apart from compensation, the family members of the losers of the land were given R cards for employment facility with the 3rd defendant-Visakhapatnam Steel Plant. Realizing that there are some errors and complaints with regard to the obtaining R cards, a scheme has been formulated to identify the bogus R cards and to eliminate them and that a committee was also appointed for verification. The authorities having taken up the exercise, issued notices to the parties and they were called to participate in the enquiry and after making personal enquiries and inspections by D.Ws.1 and 3, the bogus cards have been identified and notices have been prepared and that consequently the proceedings dated 26.10.1993 were issued. Contending that the said proceedings have been passed against the principles of natural justice and that no opportunity and no enquiry was conducted, Writ Petition No.1702 of 1994 and batch were preferred before this Court and the learned Single Judge of this Court dismissed the Writ Petition. Challenging the said order, the matter was carried to the Division Bench of this Court and the Division Bench while dismissing the Writ Appeals found that as the issues involve disputed question of fact, no relief can be granted in the writ petitions and the petitioners therein may seek such remedies as may be available to them under law. Therefore, the present suit was filed. The 2nd defendant filed written statement which was adopted by the 1st defendant, inter alia, contending that the civil court has no jurisdiction to enquire into the competency of cancellation of R cards and that the suit is barred by limitation. The 3rd defendant also filed written statement denying the plaint averments and reiterating most of the contentions raised by the defendants 1 and 2. On the basis of the pleadings, the trial Court framed the following issues : i) whether this Court has jurisdiction to en tertian the suit ? ii) whether the suit is within time ? iii) whether the suit is bad for want of notice u/s 80 CPC ? iv) whether the cancellation of proceedings of R card in RC No.1140/90 dated 26.10.1993 is legal and valid ? v) whether the plaintiff is entitled for declaration and consequential injunction ? vi) to what relief ? Subsequently, the issues have been recast as follows by the trial Court. i) Whether the plaintiff is entitled for declaration and consequential injunction as prayed for ? ii) Whether the land losers or their agreement holders or nominees of land losers have played any fraud in obtaining R cards ? iii) Whether the suit is barred by limitation ? iv) Whether the subject matter is hit by res judicata in view of the orders passed in the Writ Petitions and Writ Appeals ? v) To what relief ? On behalf of the plaintiff, P.Ws. 1 and 2 were examined and Exs.A.1 to A.7 were marked. On behalf of the defendants D.Ws. 1 to 3 were examined and Exs.B.1 to B.14 were marked. The trial Court considering the material on record, dismissed the suit. Aggrieved by the said judgment, the plaintiff carried the matter in A.S.No.184 of 2008 before the lower appellate Court. Questioning the findings of the trial Court on the aspect of limitation, cross appeals were preferred by the Government. The lower appellate Court framed the following issues for consideration : i) Whether the R cards in dispute are obtained by fraud and if so, the cancellation of the same is legal and valid. ii) Whether the claim of the plaintiffs is barred by the principles of res judicata in view of the findings or observations of the Honourable High Court in the earlier Writ Petitions and Writ Appeals ? iii) Whether the suit of the plaintiffs is barred by limitation and the benefit u/s 14 of the Limitation Act cannot be extended ? iv) Whether the plaintiffs are entitled for the injunction prayed for ? v) Whether the judgment and decree passed by the learned Principal Senior Civil Judge, Visakhapatnam is legal and sustainable ? vi) To what relief ? ” The lower appellate Court on reconsideration of the entire evidence on record dismissed the appeal, and partly allowed the cross appeal filed by the Government holding that the principles of res judicata is applicable and that the suit is barred. Hence, the Second Appeal. Heard the learned counsel for both the parties. Learned counsel for the appellant-plaintiff contended that plaintiff receiving compensation amount clearly establishes the presence and possession of the lands on the notified date by the plaintiff and that no documentary evidence was produced to establish the alleged fraud played by the plaintiff. Learned counsel relying on the decision of the Supreme Court reported in KUNHAYAMMED v. STATE OF KERALA ( (1) 2000 (6) SCC 359 ) contended that in view of the orders of the Division Bench of this Court in the Writ Appeal Nos.1455 of 2001 and batch holding that the appellant can avail the remedies as may be available in law, the order of the learned single Judge dated 3.7.2001 in W.P.No.20542 of 2001 and batch merges with the order of the Division Bench dated 24.9.2001 in W.A.No.1455 of 2001 and consequently the order of the learned single Judge is of no consequence in view of principle of doctrine of merger. It is the contention of the counsel that the lower appellate Court erred in reversing the judgment of the trial Court to the extent that the suit is barred by limitation and is hit by res judicata and that there are no specific guidelines for issuance of R cards except to those who had received compensation and thus the plaintiff and others were rightly issued with the R cards and the same cannot be found fault. It is further contended that award passed by the Civil Court became final and that in utter violation of principles of natural justice R cards were cancelled and that plea of ‘fraud’ raised by the defendant has to be proved by positive evidence and not by surmises and conjectures and therefore sought for allowing of the appeal. On the other hand, learned counsel for the respondents contended that the lower appellate Court on proper appreciation of the evidence on record came to correct conclusion and that when fraud is played by the parties it vitiates every solemn act and it cannot be saved by the application of any equitable doctrine including res judicata. In support of his contentions he relied on the decision reported in RAMA CHANDRA SINGH v. SAVITRI DEVI ( (2) 2003 (8) SCC 319 ). The following issues are framed as substantial questions of law. “ a) Whether the lower court was justified in framing an issue in respect of fraud on mere mentioning in the statement without placing any credible evidence. ? b) Whether R- cards issued under the acquisition proceedings can be cancelled where the award under the Land Acquisition proceedings have become final ? c) Whether the lower appellate court is justified in dismissing the appeal on the ground of res judicata ? d) Whether the lower appellate court is justified in reversing and holding that the suit is bared by limitation ? Points : The plaintiff in the trial court is the appellant in the Second Appeal. The plaintiff filed the suit challenging the proceedings issued by the 1st defendant dated 26-10- 2003. The effect of the impugned order dated 26.10.1993 is the cancellation of R- Card (Rehabilitation Card ) issued to the persons whose lands were acquired for laying Railway Lane for the purpose of Visakhapatnam Steel Plant-3rd defendant by passing a Land Acquisition Award No.1/87, dated 9.1.1987. The main thrust of all the plaintiff in challenging the impugned proceedings dated 26-10-19093 is that the 1st respondent passed the said order without following the principles of natural justice and fair play. The effect of the impugned order is that the plaintiff fraudulently secured employment with the 3rd defendant steel plant pursuant to the R-Card issued to the persons whose lands were acquired under Award No.1/1987 dated 9.1.1987 and if the R-Cards are cancelled, the consequential effect is that the 3rd defendant may initiate proceedings for termination of services of the plaintiff with them. The plaintiff along with others, on an earlier occasion after issuance of proceedings dated 26.10.1993, approached this Court by way of Writ Petitions and the said Writ Petitions were dismissed by order dated 3.7.2001 in W.P.No.20542 of 1993 and batch. The unsuccessful petitioners carried the matter in appeal before the Division Bench of this Court in W.A.No.1455 of 2001 and batch. The question that arose for consideration in those batch of writ appeals was as to whether the appellants obtained R Cards by playing fraud or not. Adverting to the same, the Division Bench of this Court dismissed the said batch of Writ Appeals, holding that that it is open to the appellants to avail the remedies as may be available to them in law. The relevant portion of the order reads as under : “ Having regard to the fact that we can neither permit the appellants to adduce evidence to enable them to establish the genuineness of the R cards issued to them nor can in the writ proceedings such disputed question of fact can be gone into, which requires adducing of elaborate oral and documentary evidence, we are of the opinion that no case has been made out by the appellants warranting interference with the impugned order passed by the learned single Judge dismissing the review petitions filed by the appellants seeking review of the judgment passed in the writ petitions.” It is also to be taken note of that in the written statement filed by the Steel Plant, the particulars of fraud in obtaining R cards have been specifically mentioned with reference to the number of members that were granted R card. In the instance, the fraud was pleaded by the defendant. The written statement elaborately discloses as to the facts reflecting the non-entitlement of R-cards. Thus, the officials in discharge of official duties have inspected the places where the R Card holders are said to be residing, particularly with reference to the voter’s list and then submitted report, which forms basis for issuance of impugned proceedings. As such the concept of fraud is interlinked to the conduct of the parties. In this context it is apt to refer to the judgment of the Supreme Court reported in RAM CHANDRA SINGH’s case ( 2 supra ) wherein it was held that fraud, as is well known, vitiates every solemn act and that fraud and justice never dwell together. The relevant portion of the judgment reads as under: “… Fraud is a conduct either by letter or words, which induces the other person or authority to take a definite determinative stand as a response to the conduct of the former either by word or letter. It is also well settled that misrepresentation itself amounts to fraud. … Although in a given case a 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.” In view of the above judgment, I am of the view that the lower appellate Court rightly came to the conclusion on the issue of fraud. The Division Bench of this Court while dismissing the Writ Appeals categorically held that it is open to the appellants to avail the remedies as may be available to them under law and that the appellant approached the trial Court by filing the suits wherein the claim of the appellant was negatived by both the courts below. In the circumstances, the contention of the learned counsel for the appellant with regard to doctrine of merger is of no help and do not merit any consideration. The trial Court as well as the lower appellate Courts categorically found that notices have been given to the effected parties and they were called to participate in the enquiry and after making personal enquiries and inspections by D.Ws.1 and 3 the bogus cards have been identified and that notices have been prepared under Ex.B.14 and thereafter impugned order was passed. Exs. B.1 to B.6 clearly show about the material gathered by the officers during the inspection. The enquiry officers have considered the factum of residence in small premises and also the entry in the voters list. The main object of the Land Acquisition Act is to fix the just market value and to make payment of compensation and under the Award, every person, who has got a right in the property is entitled to receive compensation. However, the issuance of R-card is not at all part of the scheme under the Land Acquisition Act. In the instant case the Government in order to rehabilitate the land outstees, has come with the scheme of R-cards which facilitates employment in Steel Plant. R-Cards cannot be claimed as a matter of right. Therefore provision of issuance of R card is a separate scheme formulated by the Government subject to verification and confirmation. The lower appellate Court therefore rightly opined that merely because the award for acquisition of the land has become final, it does not mean that the benefit graciously extended by the Government create a right. In fact the improper obtaining of R cards would entitle the defendants to weed out bogus and fraudulent R cards and that the bogus R cards have been detected by the Government pursuant to the enquiry itself. It is seen from the evidence of Dws.1 and 3 that the affected persons were given notice. It is further seen from the record that the exercise taken up by the Government by issuing Ex.B.7-G.O is not very late and the order under attack is a consequence of Ex.B.7. Considering these aspect the lower appellate Court observed as follows : “ … Fraud which is apparent and undisputable and second thing is that fraud which could only be ascertained by investigation and the conduct or the feelings of the parties. When the fraud is apparent, and the facts disclosing the same, and when responsible Government officers against the beneficial enjoyers have conducted enquiry and came to the conclusion about the fraud basing on fair play, naturally, it cannot be said to be a fact which was not based on reasoning or verification. In fact, as can be seen from the report of the Enquiry Officer, these claimants raised several huts in small extent and several persons living in a single hut is improbable and by any sense of imagination, it is reflection of fraud by itself. The circumstance which is said to be the basic requirement for grant of R card and for rehabilitation, is a residence which can only be proved by voters list or otherwise. The Enquiry Officers have taken all pains to verify the records, made spot inspections and probabilities were recorded. In fact, from the cross examination of D.Ws.1 and 3 there is no aspersion against their bona fides in making enquiry. Therefore w hen such evidence has come on record, then the burden definitely shifts on to the plaintiff to prove that the findings arrived at by the Enquiry Officers are incorrect and they have evidence to show their right to R cards. …. Even before this Court there is no change of the situation and therefore the plaintiffs cannot canvass that the evidence on record is not sufficient to establish the fraud alleged against them. I have no hesitation that the evidence of D.Ws. 1 and 3 reflects the high improbabilities of the persons living at the place and consequently the way in which the bogus cards have been obtained. The lower court also considered the apparent fraud in obtaining the R cards by the persons, who are already employed and also finding it improbable that several families would have lived in a single hut. In paragraph 46 of the judgment the lower court has also given clear reasons about the apparent fraud by the parties. ” With regard to the issue of res judicata, the lower appellate Court observed that maintainability of the suit or filing of a suit are independent rights to be considered by the Court and even without the observations of the High Court the suit could have been filed, but at the same time, it does not give a right to the appellant to show that the merits decided by the High Court have to be ignored in the suit and therefore rightly set aside the findings of the trial Court on the issue of res judicata. The lower appellate court considering the report of the enquiry officer opined that the claimants raised several huts in small extents and several persons are said to be living in a single hut which is improbable and by any stretch of imagination, it is reflection of fraud by itself. In view of the judgment of the Supreme Court in RAMCHANDRA SINGH ‘s case ( supra ), I am of the view that once the R card has been obtained by practicing fraud, it is trite that the principles of res judicata, shall not apply. With regard to the last issue as to entitlement of benefit under section 14 of the Limitation Act the plaintiff filed suit questioning the impugned order and merely because on earlier occasion he approached this Curt for efficacious relief, his bona fides in pursuing the legal rights cannot be doubted and therefore the plaintiff is entitled for the above benefit. However, the appeal does not merit consideration warranting any interference of this Court, for the reason that the fraud when established by the conduct of the parties, it will not change the situation of the appellants on the issues of res judicata and whether the suit is barred by limitation or not, and it will not improve the case of the appellant on any count. For the foregoing reasons and on consideration of the entire material on record, I am of the view that the issues raised in the ground nos. (a) to (d ) are not substantial questions of law. In the circumstances, I do not see any merit in the Second Appeal and it is dismissed. Consequent upon dismissal of this Second Appeal and for the reasons given therein, all other Second Appeals are also dismissed. No costs. Kk 13-8-2010 THE HON’BLE SRI JUSTICE GHULAM MOHAMMED SA Nos.749,779,798,797,799,800,803,804,805,,806,807, 808,839,840,843,844,845,846,847,848,849,850,851,852,853,857,858,860,861,905,909,917,918 of 2009 13-8-2010