- Bookmark
- Share
- CaseIQ
Oil And Natural Gas Corporation Ltd. v. Phula Bala Paul And Ors. (And Other Cases)
Structured Summary of the Provided Legal Opinion
Factual and Procedural Background
The Oil and Natural Gas Corporation Limited (appellant) filed a batch of Land Acquisition Appeals challenging the legality, validity and justifiability of a common Award dated 23.11.2001 passed by the District Judge, Cachar, Silchar in Misc. (LA) Case Nos. 170/98, 171/98, 346/2000, 347/2000, 348/2000 and 349/2000. These appeals arise from a single common Award and were heard together.
The Collector, Cachar, Silchar acquired an area of 140 B 12 K 14 Ch at the instance of the appellant after issuing the necessary notifications under the Land Acquisition Act. The Collector fixed the market value of the land by class (Chara: Rs. 15,000 per bigha; Bhit: Rs. 17,000 per bigha; No class: Rs. 11,000 per bigha). The claimants accepted compensation under protest and the matter was referred under section 18(1) of the Land Acquisition Act to the District Judge for determination of market value.
The reference court (learned District Judge) heard the claimants, who produced certified copies of various sale deeds, and the Collector (through an official witness). The District Judge assessed market value at a lump sum of Rs. 70,000 per bigha irrespective of class, granted solatium at 33% and interest at 12% per annum, and thereby enhanced the compensation by the order dated 23.11.2001.
The appellant contends that it was not impleaded in the reference proceedings and only discovered, during the appeal, that certain sale-deed exhibits relied upon by the claimants were fraudulently manufactured. The appellant produced certified copies obtained from the Sub-Registrar which contained materially different particulars (including much lower consideration amounts and different parties) for the same sale-deed numbers exhibited in the reference court.
Legal Issues Presented
- Whether the appellant (a person on whose behalf land is acquired but not a party before the Collector or reference court) is entitled to file appeals under section 54 of the Land Acquisition Act challenging the reference court's Award.
- Whether the Awards of the reference court enhancing compensation (based on sale-deed exhibits produced by the claimants) are vitiated by fraud and, if so, whether the Awards should be set aside and the matter remanded.
Arguments of the Parties
Appellant's Arguments (Mr. S. Dutta)
- The appellant (ONGC) is entitled to file appeals under section 54 of the Land Acquisition Act because a person who benefits from acquisition (or who is liable to pay compensation) is a person "aggrieved" and thus has the right to appeal.
- The sale-deed exhibits relied upon by the claimants in the reference were fraudulently manufactured. Certified copies obtained from the Sub-Registrar show different parties and materially lower consideration amounts than those exhibited in the reference proceedings.
- Because the reference court's enhancement of compensation was based on those allegedly fraudulent documents, the Awards are vitiated and unsustainable in law.
Respondents'/Claimants' Arguments (Mr. M.H.R. Borbuiya)
- A preliminary objection was raised (by Mr. Rajborbhuiya) that the appeals are not maintainable because the appellant was not a party before the Collector or the reference court.
- On the substantive challenge to the exhibited documents (the certified copies produced by the appellant), the respondents' counsel made no comment on those specific documents at the hearing (the opinion records that he "made no comment").
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Hindustan Paper Corporation, Jagiroad v. Sohan Lal Pugalia, (1993) 1 GLR 165 (Full Bench) | Interpreting section 54 of the Land Acquisition Act: where statute does not restrict the right of filing an appeal by “a party aggrieved,” “any person aggrieved” can file an appeal; a company liable to pay compensation is a person aggrieved. | The court relied on this Full Bench decision to hold that the appellant (liable to pay compensation) was a person aggrieved and therefore entitled to file the appeals; the maintainability objection failed. |
| Pipri Chinchwad New Town Development Authority v. Diwakar Gopal Khare, (2004) 13 SCC 587 | Interpreting sections 18, 50, 53 and 54 of the Land Acquisition Act: a person on whose behalf land is acquired has the right of appeal. | The court relied on this Apex Court authority, together with Hindustan Paper, to reject the maintainability objection and confirm the appellant's right to challenge the Award. |
| Indian Bank v. Satyam Fibres (India) Pvt. Ltd., (1996) 5 SCC 550 | Holds that fraud vitiates court proceedings; courts have inherent power to set aside an order obtained by fraud and to set aside a sale brought about by fraud practiced upon the court; inherent power also exists where the court is misled or where a mistake prejudices a party. | The court invoked this principle to support setting aside the reference Awards which were based on documents that raised a prima facie case of fraud practiced upon the reference court. |
| Ishwar Mahton v. Sitaram Pumar | Authority cited in Indian Bank as an example where a sale brought about by fraud before the court was set aside. | Referred to as supporting authority for the proposition that orders/sales obtained by fraud can be set aside; used as part of the chain of authorities justifying quashing the Awards. |
| Binoy Krishna Mukharjee v. Mohanlal Goenka; Gajanand Sha v. Dayanand Thakue; Krishnakumar v. Jawand Singh; Devendra Nath Sarkar v. Ram Rachpal Singh; Saiyed Md. Roza v. Ram Saroop; Bankey Behari Lal v. Abdul Rahman; Lakshmi Amma Chacki Amma v. Mammen Mammen | Series of authorities cited (within Indian Bank) for the proposition that courts possess inherent power to recall or set aside orders obtained by fraud or where the court is misled. | These cases were cited (via Indian Bank) as part of the legal basis for the proposition that fraud vitiates judicial proceedings; the present court relied on the settled principle to set aside the Awards. |
| Bhaurao Dagdu Paralkar v. State of Maharashtra, (2005) 7 SCC 605 | Considered definition and elements of "fraud": involves intention to deceive, two elements (deceit and injury), and explained that injury includes deprivation of property or other harm; clarifies concept of fraud in court proceedings. | The court cited this decision to explain the nature of "fraud" and to support its conclusion that the apparent fabrication of sale-deed exhibits amounted to fraud justifying setting aside the Awards and ordering further investigation. |
Court's Reasoning and Analysis
The court's reasoning proceeds in two principal strands: (A) the question of maintainability of the appeals and (B) the substantive challenge to the Award based on alleged fraudulent documentary exhibits.
(A) Maintainability
- Mr. Rajborbhuiya raised a preliminary objection that the appellant was not a party before the Collector or the reference court and therefore could not maintain the appeals.
- The court examined section 54 of the Land Acquisition Act and relied on the Full Bench decision in Hindustan Paper Corporation (1993) 1 GLR 165 which held that where the statute does not restrict the right to appeal to a defined class of "party," the phrase "a party aggrieved" should be read to permit "any person aggrieved" to appeal.
- The court further relied on the Apex Court's decision in Pipri Chinchwad New Town Development Authority v. Diwakar Gopal Khare (2004) 13 SCC 587 which held that a person on whose behalf land is acquired has a right of appeal under the relevant provisions.
- Applying those authorities, the court concluded that the appellant (being a person on whose behalf the land was acquired and/or the company liable to pay the compensation) had the statutory right to file the appeals. The maintainability objection was rejected.
(B) Substantive challenge — fraud in documentary evidence
- Factfinding: The reference court accepted certified copies of several sale deeds (recorded as Exts-1, 3, 4, 6, 7 and 8) produced by the claimants and on that basis assessed market value at Rs. 70,000 per bigha and awarded solatium and interest.
- The appellant produced certified copies obtained from the Sub-Registrar for the same sale-deed numbers; these official copies disclosed materially different transactions — different parties and much lower consideration amounts (examples: sale deed No. 416/88 in official copy recorded sale at Rs. 4,000; No. 413/85 at Rs. 3,100; No. 305/84 showed a transaction at Rs. 200 and appeared to be a mortgage deed rather than a sale deed; No. 1581/84 recorded Rs. 2,000).
- The court compared the two sets of documents and found that the versions exhibited in the reference court showed substantially inflated consideration amounts and different parties, prima facie indicating fabrication or fraudulent manufacture.
- The court noted that the reference court accepted those certified copies without calling for the originals because claimants did not claim title to the properties but only sought to show market values.
- Legal principle applied: The court relied on the well-settled principle that fraud vitiates judicial proceedings and that courts have inherent power to set aside orders or sales obtained by fraud (citing Indian Bank v. Satyam Fibres and other authorities). The court also relied on Bhaurao Paralkar for an exposition of the elements and consequences of fraud.
- Applying these principles to the facts (the prima facie evidence of fabricated sale deeds and the reference court's reliance on them), the court concluded that the Awards based on such documents were not sustainable in law.
- Resulting remedial steps: The court set aside and quashed the impugned Awards, remanded the matter to the learned District Judge for a fresh decision in accordance with law while providing the appellant adequate opportunity to place its case, and directed criminal investigation into the alleged fabrication.
Holding and Implications
Holding: The court SET ASIDE AND QUASHED the impugned Awards dated 23.11.2001 passed by the learned District Judge, Cachar, Silchar, and remanded the matter to the District Judge for fresh decision in accordance with law while providing adequate opportunity to the appellant.
Specific directions and immediate consequences:
- The Registry was directed to forward a copy of this Judgment along with Exts. 1, 3, 4, 6, 7 and 8 and the documents produced by the appellant to the Superintendent of Police, Cachar, Silchar.
- On receipt, the Superintendent of Police was ordered to register a criminal case under appropriate sections, investigate the genuineness/fraudulent manufacturing of the said documents, and investigate under strict supervision to identify and deal with culprits, if any.
- The learned District Judge, Cachar, Silchar was directed to render all necessary assistance for the investigation.
- The Registry was directed to register a Misc. Case and to appraise this court regarding the stage of investigation; the Superintendent of Police and the Officer-in-Charge, Silchar Police Station were directed to report progress to this court so that monitoring is possible.
- The interim order dated 17.5.2007 passed by this court was vacated and the Lower Court Records (LCRs) were ordered to be sent down forthwith.
Implications regarding precedent: The opinion applies and relies upon existing authorities concerning (a) the statutory right to appeal under the Land Acquisition Act (Hindustan Paper; Pipri Chinchwad) and (b) the doctrine that fraud vitiates court proceedings and permits courts to set aside orders obtained by fraud (Indian Bank; Bhaurao Paralkar and related authorities). The opinion does not purport to create a new legal principle but applies established precedent to the facts of this case.
1. Challenging the legality, validity and justifiability in passing the common Award dated 23.11.2001 passed by the learned District Judge, Cachar, Silchar, in Misc. (LA) Case Nos. 170/98,171/98,346/2000, 347/2000, 348/2000 and 349/2000 the present LA Appeals have been filed by the Oil and Natural Gas Corporation Limited. All these appeals have arisen out of a common Award giving rise to common facts and law, as agreed to by the learned counsel for the parties, these are heard together and disposed of analogously.
2. I have heard Mr. S. Dutta, learned counsel for the appellant and Mr. M.H.R Borbuiya, learned counsel for the respondents. A preliminary point has been raised by Mr. Rajborbhuiya about the maintainability of this batch of appeal, inasmuch as, the appellant was not a party either before the Collector or before the reference court and, as such, the appellant is not entitled to challenge the award by filing these appeals. However, Mr. Dutta referring to section 54 of the Land Acquisition Act, submits that such right to file is inherent upon a person on whose benefit certain area of land is acquired and such beneficiary is to receive the amount so enhanced by the District Judge in respect of such acquired land.
3. The aforesaid point came up before a Full Bench of this court in Hindustan Paper Corporation, Jagiroad… v. Sohan Lal Pugalia, (1993) 1 GLR 165, wherein the Full Bench interpreting section 54 has categorically held that wherein the statute does not restrict the right of filing an appeal by “a party aggrieved” it must follow that “any person aggrieved” can file an appeal. The company which is liable to pay the compensation fixed by the reference court is a person aggrieved by the decision of the reference court and can file an appeal invoking section 54 of the Act.
4. That apart, the Apex Court in the case of Pipri Chinchwad New Town Development Authority v. Diwakar Gopal Khare, (2004) 13 SCC 587, interpreting sections 18, 50, 53 and 54 of the Act has held that a person on whose behalf the land is acquired has a right of appeal. In view of the aforesaid legal position, the preliminary objection raised about the maintainability of the appeals is not sustainable and hence, stands rejected.
5. An area of 140 B 12 K 14 Ch was acquired by the Collector, Cachar, Silchar at the instance of the present appellant by complying with the necessary formalities, i.e, issuance of required statutory notification as required under the Land Acquisition Act. The present respondents/claimants are/were owners of the aioresaid land so acquired by the Collector, Cachar, Silchar. The Collector fixed the market value of the acquired land as under—
(1) Chara Class per Bigha = Rs. 15,000 (2) Bhit per Bigha = Rs. 17,000 (3) No class per bigha = Rs. 11,000
6. The claimants accepted the compensation on protest and on their prayer the matter was referred under section 18(1) of the Land Acquisition Act to the learned District Judge, Cachar, Silchar for deciding the market value of the land as the claimants were not satisfied with the fixation of the price of the acquired land. It is to be noted herein that the present appellants were not impleaded as party before the reference court and, as such, the entire proceeding proceeded against them without their knowledge and behind their back.
7. In course of the proceeding in the reference court, the claimants examined five CWs on their behalf and exhibited ten documents whereas the Collector examined one DW who is the official of the Land Acquisition Branch of the Silchar Collectorate who produced the necessary documents from the Land Acquisition Branch in respect of the acquired land. The ten documents so produced by the witnesses of the claimants are all certified copies of different sale deeds. The reference court on the basis of the price as quoted in the exhibited sale deeds and taking the view of increasing price of such landed property at the rate of 12 per cent per annum assessed the market value of the acquired land at lump sum basis at Rs. 70,000 per bigha irrespective of the class of the land. That apart, the learned District Judge granted solatium at the rate of 33% and interest at the rate of 12% per annum upon the enhanced rate under section 23(1)(a) of the Land Acquisition Act and finally terminated the proceeding vide order dated 23.11.2001 enhancing the compensation by the Collector in the manner aforesaid.
8. Challenging the impugned Award, it is submitted by Mr. Dutta that the certified copies of the sale deeds exhibited on behalf of the claimants which have been accepted as the basis of enhancement of the compensation were discovered to be fraudulently manufactured and, in fact, most of such exhibits are non-existent. The learned counsel submits that when necessary information regarding the aforesaid exhibited sale deeds was sought for from the office of the Sub-Registrar, Silchar, no information could be furnished to them by the Sub-Registrar, as those documents are non-existent. Certified copies of such seven sale deeds with identical numbers exhibited in the court obtained by the appellant have also been produced before this court by Mr. Dutta, in support of his contention that the sale deeds, in fact, are different than those exhibited. I have perused those sale deeds and those are put on record. Referring to the sale deeds, Mr. Dutta submits that the claimants resorted to fraud with a view to get enhanced compensation and were instrumental in getting enhanced compensation than awarded by the Collector and, as such, the same is vitiated.
9. Mr. Raj Borbhuiya, learned counsel for the respondents/claimants, upon perusal of those documents produced by Mr. Dutta, made no comment on those documents. In passing the impugned Award the learned District Judge accepted the following exhibits:
(1) Ext-1, Sale Deed No. 416/88 exhibited in favour of Amrit Lal Deb by one Roma Roy for Rs. 1,25,000.
(2) Ext-3, Sale Deed No. 413/85 exhibited on 12.4.1985 in favour of Md. Ayub Ali by one Amalendu Shyam for Rs. 1,20,000.
(3) Ext-4, Sale Deed No. 305/84 exhibited on 15.2.1984 in favour of Jamil Ahmed by one Rajiv Deb Purkayastha for Rs. 76,000.
(4) Ext-6, Sale Deed No. 1581/84 exhibited on 8.4.1986 in favour of Makkadas Ali and others by one Anjan Kumar Paul for Rs. 1,20,000.
(5) Ext-7, Sale Deed No. 913/83 exhibited on 17.3.1983 in favour of Akadas Ali and others by one Joynarayan Kurmi for Rs. 60,000.
(6) Ext-8, Sale Deed No. 285/84 exhibited on 5.2.1984 in favour of Makkadas Ali by one Akhil Dasgupta for Rs. 70,000.
10. The certified copies of the aforesaid, sale deeds of identical numbers submitted by Mr. Dutta disclose a different picture. The aforesaid sale deeds, i.e, which are exhibited as Exts-1, 3, 4, 6, 7 and 8 are not executed by the executants mentioned in the exhibits nor in favour of the persons as disclosed therein. The sale deed No. 416/88 is the sale deed wherein the land in question was sold at Rs. 4,000. Similarly, the sale deed No. 413/85, the transaction of sale took place at Rs. 3,100. In sale deed No. 305/84, the transaction took place at Rs. 200 and, in fact, its mortgage deed and not a sale deed. The sale deed No. 1581/84 was transacted for Rs. 2,000.
11. A bare reading of the two sets of sale deeds pertaining to the same Sub-Registrar office with identical numbers disclose that the exhibited sale deeds, the value have been shown to be fabulously higher and inflated than what is disclosed in the sale deeds so produced by Mr. Dutta as referred to above. Apart from the consideration of amount, the parties to the transaction also do not tally.
12. The aforesaid exhibits have been accepted by the learned District Judge in a judicial proceeding in the Reference cases, as produced by the respondents/claimants. The decision to enhance the market value of the acquired land is also based on the aforesaid exhibits so produced by the claimants. The picture that emerges from the aforesaid fact it is apparent prima facie that the claimants appear to have practiced fraud to get compensation at inflated rate going to the extent of manufacturing such sale deeds. In such a situation, the decision rendered by the learned District Judge enhancing the compensation based on fraud is not sustainable in law. Mr. Borbhuiya during the course of hearing could not justify to get enhanced rate on the basis of exhibited sale deeds dealing with the effect of practicing fraud, the Apex Court in the case of Indian Bank v. Satyam Fibres (India) Pvt. Ltd., reported in (1996) 5 SCC 550, at paragraph-23, held as follows:
“Since fraud affects the solemnity, regularity and orderliness of the proceedings of the court and also amounts to an abuse of the process of the court, the courts have been held to have inherent power to set aside an order obtained by fraud practiced upon that court. Similarly, where the court is misled by a party or the court itself commits a mistake which prejudices a party, the court has the inherent power to recall its order. (See Binoy Krishna Mukharjee v. Mohanlal Goenka, Gajanand Sha v. Dayanand Thakue, Krishnakumar v. Jawand Singh, Devendra Nath Sarkar v. Ram Rachpal Singh, Saiyed Md. Roza v. Ram Saroop, Bankey Behari Lal v. Abdul Rahman, Lakshmi Amma Chacki Amma v. Mammen Mammen). The court has also the inherent power to set aside a sale brought about by fraud practiced upon the court (Ishwar Mahton v. Sitaram Pumar) or to set aside the order recording compromise obtained by fraud. Bindesawri Pd. Choudhury v. Devendra Pd. Singh, Tara Bai v. V.S Krishnaswamy Rao).”.
13. In a recent decision of the Apex Court reported in (2005) 7 SCC 605, (Bhaurao Dagdu Paralkar v. State of Maharastra) had the occasion extensively to deal with the expression “fraud” and the effect of practice thereof in the Court of Law. The Apex Court held that—
‘By “fraud” is meant an intention to deceive, whether it is from any expectation of advantage to the party himself or from ill will towards the other is immaterial. The expression “fraud” involves two elements, deceit and injury to the person deceived. Injury is something other than economic loss, that is, deprivation of property, whether movable or immovable or of money and it will include any harm whatever caused to any person in body, mind, reputation or such others. In short, it is a non-economic or non-pecuniary loss. A benefit or advantage to the deceiver, will almost always cause loss or detriment to the deceived. Even in those rate cases where there is a benefit or advantage to the deceiver, but no corresponding loss to the deceived, the second condition is satisfied. [See Indian Bank v. Satyam Fibres (India) Pvt. Ltd.]”.
14. On perusal of the exhibited documents as well as documents submitted by Mr. Dutta (copies of which are kept on records), there appears a genuine doubt about the genuineness of the aforesaid exhibits, namely Exts. 1, 3, 4, 6, 7 and 8, as exhibited before the reference court. The records disclose that those certified copies of the sale deeds were accepted without calling for the originals, for the reason that by virtue of those sale deeds the claimants did not claim any title over the property covered by those sale deeds, but to show and establish the market value of the land etc. at the relevant time.
15. In view of the aforesaid discussions and grave doubt about the genuineness of the exhibited documents on the basis of which Awards have been passed, I have no hesitation to set aside the impugned judgment passed by the learned reference court, which I do accordingly. The impugned Awards are set aside and quashed. The matter is remanded back to the learned District Judge for fresh decision in accordance with law providing adequate opportunity to the appellant to place its case properly.
16. The Registry of this court is directed to forward a copy of this Judgment along with the Ext. 1, 3, 4, 6, 7 and 8 and the documents produced by Mr. Dutta, to the Superintendent of Police, Cachar, Silchar and on receipt of the same, the Superintendent of Police, Cachar, Silchar shall cause registering criminal case under appropriate sections of law and necessary investigation be caused regarding genuineness/fraudulent manufacturing of the aforesaid documents and investigate the matter under his strict supervision to unearth and identify the culprits, if any, and to deal with as per law. The learned District Judge, Cachar, Silchar shall render all assistance from his end whatever is necessary for the purpose of the aforesaid investigation. The Registry shall register a Misc. Case and shall appraise the court regarding the stage of investigation as directed to be conducted as aforesaid. The Superintendent of Police, Cachar, Silchar, and the Officer-in-Charge, Silchar Police Station are also directed to report back to this court from time to time about the progress of the investigation so that this court can well monitor the matter.
17. The interim order dated 17.5.2007 passed by this court stands vacated. Send down the LCRs forthwith.
Alert