Case: Ram Chandra Singh Vs. Savitri Devi

3. Respondent No. 2 herein Arun Prakash Pandey (hereinafter called as the Mortgagor) had taken loan from State Bank of India, wherefor lands were mortgaged in favour of the Bank. He became a defaulter in the matter of repayment of loan. The Bank filed a suit claiming a sum of Rs. 1,15,312,62 withand future interest as also for a preliminary decree as regard mortgaged property admeasuring 95.20 acres. In the said suit, the sisters of the mortgagor were claiming 6 annas shares in the suit properties purporting to be relying on or on the basis of a preliminary decree passed in a partition suit dated 19.7.1979 filed by the respondent No. 1 in relation to the said mortgaged land. A preliminary decree in favour of the bank for the aforementioned amount withA First Appeal was preferred thereagainst by the respondents herein and by an order dated 22.5.1988 a Division Bench directed that the decretal amount be paid in two instalments. Allegedly, the said direction had not been complied in letter and spirit. However, on an Execution Application filed by the Bank, 30 acres out of total area of 57.12 acres of land was put on auction sale on or about 7.6.1988 wherein the petitioner became the highest bidder upon offering a sum of Rs. 1,61,598.53 therefor. The said auction sale had been confirmed by the Executing Court on 7.7.1988 pursuant whereto, the appellant deposited the amount. The brother of the mortgagor, thereafter filed an objection in the said Execution case purported to be in terms of Section 47 of the Code of Civil Procedure for setting aside the auction sale which was marked as Misc. Civil Case No. 11/88. The said application was dismissed by judgment dated 27.8.1988 inter alia on the ground that keeping in view the extent of land inherited by the parties from their father being 95.20 acres, 60 acres of land belonged to the mortgagor out of which only 30 acres had been auctioned. The appellant herein in terms of order passed on or about 11.12.1990 took delivery of possession of the auctioned land. Questioning the judgment and order dated 27.8.1988 the respondents filed a Revision Petition Application before the High Court in the year 1990 marked as Revision Petition No. 1700 of 1990. The auction sale was set aside by reason of the judgment dated 21.5.1992 by the High Court inter alia directing that the following remedy be taken recourse to by theto seek a partition by filing a separate suit for causing out a separate area from the share of Arun Prakash Pandey or(b) to file an application in the aforesaid partition suit for including the area purchased by him in the Takhta of Arun Prakash Pandey.The appellant filed a Special Leave Petition thereagainst which was marked as SLP(C) No. 8119/92 before this Court which was disposed of by an order dated 25.6.1992counsel for the Petitioner withdraws this petition to cash upon the order impugned against. Special Leave Petition is disposed of as withdrawn.The appellant contends that upon obtaining possession, he made the land cultivable wherefor he had spent a sum of about Rs. 2 lakhs.7. The appellant herein, however, filed a Title Suit being No. 4/1994 inter alia for setting aside the decree passed in Partition Suit No. 17/1976 as also for setting aside the order in CR No. 1700 of 1990.8. The appellant herein also filed an application in the said partition suit No. 17/76 inter alia on the ground that the preliminary decree dated 19.7.78 was a collusive and fraudulent one and the final decree proceeding initiated on the basis thereof is null and void; inter alia on the ground that Ugam Prakash Pandey, father of the mortgagor having died in the year 1944, the mortgagor alone succeeded to the properties and not his sisters as the Hindu Succession Act, 1956 did not come into force thence. In support of the said contention the appellant filed various documents. The said application was allowedUgam Pandey died in the year 1944 when the Hindu Succession Act, 1956 had not come into force.(b) the documents prove that the plaintiff Smt. Savitri Devi had no interest in the suit property and that the preliminary decree prepared in the partition suit is fraudulent, collusive and void documents obtained in collusion with Arun Prakash Pandey by suppressing the death of Uttam Pandey in the plaint and in her evidence by playing fraud.(c) the final decree proceeding initiated by the Plaintiff on the basis of preliminary decree in collusive and nullity and therefore final decree proceeding is dropped.A Civil Revision application was filed thereagainst which has been allowed by the High Court. S.L.P. (Civil) No. 6535 of 1999 arises out of the said order.10. The appellant furthermore filed a Civil Review application being No. 245 of 1998 for reviewing the order dated 22.5.1988 passed in First Appeal No 450 of 1981 whereby and whereunder the High Court of Patna modified the judgment and preliminary decree dated 22.6.1981 by directing that the decretal amount be paid in two instalments inter alia on the ground that the fact relating to the sale of the mortgage property in favour of the petitioner has not been brought to its notice. The said Civil Review application was dismissed by a learned Judge on 10.5.1999. S.L.P. (Civil) No. 20273 of 2000 arises out of the said order.

Court's reasoning:
35. Once it is held that a judgment and decree has been obtained by practising fraud on the court it is trite that the principles of resjudicata shall not apply. The High Court, therefore, in our opinion committed a serious error in referring to the earlier orders passed by it so as to shut the doors of justice on the face of appellant for all time to come. We, therefore, are of the opinion that the impugned judgment dated 10.12.1998 cannot be sustained.36. So far as the order dated 10.5.1999 passed in Civil Review No. 245/1998 is concerned, suffice it to say that the High Court should have considered the question as to whether the right of the auction purchaser could have been set at naught by reason of a consent order passed in his absence. The appellant was not a party in the First Appeal. He was also not a party to the compromise.37. The consent order, as isis an agreement between the parties with the seal of the Court superadded to it. The appellant herein in the Review Application categorically stated that the parties to the appeal had suppressed the auction sale as also the confirmation thereof. The effect of the events appearing subsequent to the filing of First Appeal resulting in creation of a third party right was bound to be taken into consideration by the High Court. A third party right cannot be set at naught by consent. The High Court, therefore was required to consider the contention of the appellant in their proper perspective. The High Court, in our opinion, was obligated to address itself on these questions for the purpose of reviewing its order.38. In Dwarka Prasad Agarwal (D) By Lrs. and Another vs. B.D. Agarwal and Others [ 2003 (6) SCC 230 ], it wasissues of grave importance were required to be addressed by the High Court. The High Court sought to take a short cut in holding that the said compromise was not binding upon Dwarka Prasad Agarwal and thereby no writ was issued. The consequence of recording of the said compromise wasNot only pursuant thereto or in furtherance thereof the Registrar of Newspapers, New Delhi, passed an order dated 3.9.1992; it was construed to be a judgment of the High Court which had been taken aid of by the respondents herein for the purpose of withdrawal of suits wherein various disputed questions of facts and law including the genuineness or otherwise of the agreements were n question and required adjudication. The High Court was also required to address itself, more so while disposing of the review application, as to whether the purported settlement on the grounds raised by the appellants herein, was a lawful one. Without any application of mind, the High Court proceeded to hold that the agreement was lawful. It did not pose unto itself the right question so as to enable himself to arrive at a finding of fact resulting in correct answer thereto and, thus, the same would amount to a misdirection in law.It was furtherled that an order passed by a court without jurisdiction is a nullity. Any order passed or action taken pursuant thereto or in furtherance thereof would also be nullities. In the instant case, as the High Court did not have any jurisdiction to record the compromise for the reasons stated hereinbefore and in particular as no writ was required to be issued having regard to the fact that public law remedy could not have been resorted to, the impugned orders must be held to be illegal and without jurisdiction and are liable to be set aside. All orders and actions taken pursuant to or in furtherance thereof must also be declared wholly illegal and without jurisdiction and consequently are liable to be set aside. They are declared as such.It will bear repetition to state that any order obtained by practising fraud on court is alsoin the eyes of law.41. It is true that pursuant to or in furtherance of the consent order, the respondents had deposited the amount and the State Government has appropriated the same. The legal issues as regard the effect of commission of fraud on courtthe conduct of the parties are still at large. The High Court was, therefore, required to adjust the equities between the parties. The Bank cannot also unjustly enrich itself insofar as; while enforcing a preliminary decree of mortgage, it cannot take also recourse to recover the decretal amount from theat the expense of the auction purchaser.42. In such an event also, the Court may have to find out a remedy which would be just and equitable.43. The High Court furthermore failed to notice the principle actus curiae neminem gravabit.44. In Rajesh D. Darbar & Others vs. Narasingrao Krishnaji Kulkarni & Ors. 2003 (7) JT 209 ], this Courtcourts can take notice of the subsequent events and can mould the relief accordingly. But there is a rider to these well established principles. This can be done only in exceptional circumstances, some of which have been highlighted above. This equitable principles cannot, however, stand on the way of the court adjudicating the rights already vested by a statute. This well settled position need not detain us, when the second point urged by the appellants is focused. There can be no quarrel with the proposition as noted by the High Court that a party cannot be made to suffer on account of an act of the Court. There is a well recognised maxim of equity, namely, actus curiae neminem gravabit which means an act of the Court shall prejudice no man. This maxim is founded upon justice and good sense which serves a safe and certain guide for the administration of law. The other maxim is, lex non cogit ad impossibilia, i.e. the law does not compel a man to do that what he cannot possibly perform. The applicability of the abovesaid maxims has been approved by this Court in Raj Kumar Dey and ors. vs. Tarapada Dey and Ors. 1987 (4) SCC 398 , Gursharan Singh vs. New Delhi Municipal Committees 1996 (2) SCC 459  and Mohammed Gazi vs. State of M.P. and Ors. 2000 (4) SCC 342."