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Smart Summary

Factual and Procedural Background

The plaintiff-appellant challenged, by way of an appeal under Section 100 of the Code of Civil Procedure, 1908, concurrent findings of fact recorded by the lower Courts which upheld an allotment authority's order dated 30 January 1990 cancelling the allotment of certain surplus land. The original allotment in question had been made on 13 March 1981 and was later cancelled by the allotment authority on 30 January 1990 on the ground that the plaintiff-appellant was not eligible for the surplus allotment and had obtained it by misrepresentation and concealment of material facts. The appeal to the Commissioner was dismissed on 15 December 1991 and a revision petition to the Financial Commissioner failed on 22 May 1992.

The plaintiff-appellant also filed two civil suits (Civil Suit Nos. 1516-C and 1518 of 1990-1993). Both suits were dismissed on 18 November 1995 by the Additional Senior Sub-Judge, Sirsa. Separately, the defendant-respondents had executed a sale-deed dated 27 October 1988. A civil suit dated 20 November 1994 sought a declaration that the plaintiff-appellant was the owner of 16 marlas as per the jamabandi for 1987-88, alleged that revenue records naming the defendants as owners were incorrect, and sought a permanent injunction restraining construction (a service station) on the property.

The Courts below treated the judgments and decrees dated 18 November 1995 as having attained finality and concluded that the allotment of surplus area in favour of the plaintiff-appellant had been correctly dealt with by the revenue authorities. The lower Courts also found that the plaintiff-appellant had obtained the allotment by fraud on the allotment authority, which was treated as fraud on the State and the public.

Legal Issues Presented

  1. Whether the order dated 30.1.1990 (cancelling the allotment made on 13.3.1981) suffered from any legal infirmity and whether concurrent findings of fact recorded by the Courts below could be interfered with under Section 100 CPC.
  2. Whether the allotment authority (and the State through the Financial Commissioner) had the power to review/cancel the allotment order—i.e., whether there was any power of review or cancellation available under the statutory scheme.
  3. Whether allegations of fraud by the plaintiff-appellant disentitle him to relief and permit collateral or direct challenge to earlier judgments/decrees obtained in his favour.
  4. Whether the civil court had jurisdiction to entertain and decide the plaintiff-appellant's suit in the face of Section 26 of the Haryana Ceiling of Land Holdings Act, 1972 (i.e., whether the civil court was barred from trying the suit).
  5. Whether limitation would preclude the plaintiff-appellant's suit or whether the question of fraud makes limitation irrelevant to entitlement to relief.

Arguments of the Parties

Plaintiff-Appellant's Arguments

  • The allotment authority had no power of review, and therefore the orders cancelling the allotment dated 30.1.1990, 15.12.1991 and 22.5.1992 should be set aside.
  • The suit brought by the plaintiff-appellant could not be considered beyond the period of limitation, and merely alleging fraud should not automatically grant jurisdiction to the civil Court.
  • Once the civil Court recorded findings that, by reason of Section 26 of the Haryana Ceiling of Land Holdings Act, 1972, the civil Court's jurisdiction is barred, the suit should have been decided on the merits and the plaintiff-appellant should have been given an opportunity to challenge the impugned administrative orders before an appropriate forum.

The opinion does not contain a detailed account of specific arguments advanced by the defendant-respondents in these proceedings.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
S.P. Chengalvaraya Naidu (Dead) by LRs v. Jagannath (Dead) by LRs and Ors. (1995-1)109 P.L.R. 293 (S.C.) Fraud vitiates judicial acts; a judgment or decree obtained by playing fraud on the Court is a nullity and can be treated as such even in collateral proceedings. The Court applied this principle to hold that the plaintiff-appellant's allotment, obtained by concealment and misrepresentation, amounted to fraud and therefore disentitled him to relief; the fraud doctrine justified upholding the cancellation of allotment.
Sahu Madho Das and Ors. v. Mukand Ram and Ors., A.I.R. 1955 S.C. 481 Earlier judgments and decrees may be relevant even if not inter partes, where they relate to the same land and same allotment/cancellation. The Court relied on this authority to treat earlier judgments and decrees (though not inter partes) as relevant to the present controversy because they concern the same land and same allotment/cancellation letters.
Virupakshayya Shankarayya v. Neelakanta Shivacharya Pattadadevaru, A.I.R. 1955 S.C. 2187 Support for the proposition that prior judgments may be relevant where they deal with the same subject matter even if not inter partes. Used to justify treating prior decrees relating to the same land and allotment as relevant authorities in assessing the plaintiff-appellant's entitlement.
Ram Chandra Singh v. Savitri Devi; Rampreet Yadav v. U.P. Board of High School Subsequent Supreme Court decisions that followed and applied the principle in S.P. Chengalvaraya Naidu regarding the effect of fraud on judgments/decrees. The Court noted that these later decisions applied the same fraud principle and relied on them to reinforce the conclusion that the plaintiff-appellant's fraudulent conduct precludes relief and supports non-interference with the cancellation order.

Court's Reasoning and Analysis

The Court's analysis proceeded in several interlinked steps, applying factual findings to established principles:

  1. Factual finding of fraud: The record showed that the plaintiff-appellant and his wife held substantial land (154 kanals 15 marlas in the plaintiff's name and 26 kanals 18 marlas in his wife's name) which was not disclosed when obtaining the allotment from the surplus pool. The allotment was therefore obtained by concealment of material facts and misrepresentation.
  2. Effect of fraud on entitlement and prior orders: Relying on the settled principle that fraud "avoids all judicial acts", the Court held that fraudulent procurement disentitles the plaintiff-appellant to any relief. A judgment or administrative act obtained by fraud is a nullity for purposes of the present controversy; hence, cancellation of the allotment after due investigation was justified.
  3. Relevance of earlier proceedings: The Court treated earlier dismissed suits and the judgments/decrees dated 18.11.1995 relating to the same land and same allotment/cancellation as relevant, citing precedents (Sahu Madho Das and Virupakshayya) that permit such prior determinations to be treated as material even if not strictly inter partes.
  4. Authority to cancel/review: The Court rejected the appellant's contention that the allotment authority lacked power to review/cancel the allotment. It reasoned that the allotment authority had taken the precaution of obtaining orders from the Financial Commissioner, who possesses suo motu review powers under Section 18(6) of the Haryana Ceiling of Land Holdings Act, 1972. The State Government had also issued instructions conferring cancellation powers to the allotment authority in cases of fraud.
  5. Jurisdiction of civil court and preliminary issues: The Court addressed the appellant's contention about the civil court's limitations. It observed that Order XIV Rule 2 of the Code requires a court to pronounce judgment on all issues (law and fact) unless it records that the case can be disposed of on a point of law alone. There is no blanket bar under Order XIV that a court must decide only preliminary issues. Where the civil court records findings that would be inconsistent with a finding of fraud, that might create jurisdictional questions; but in the present case the civil court's findings did not negate the finding of fraud. Under Section 26 of the Act the civil court normally lacks jurisdiction to try suits in respect of such matters, and the proven fraudulent conduct meant that the civil court could not properly interfere with the cancellation order.
  6. Limitation argument: The Court did not decide the limitation point in detail, stating it was unnecessary to do so; but it held that even if limitation were favorable to the plaintiff-appellant, the established fraudulent conduct would bar relief and render the cancellation order immune from successful challenge.

Holding and Implications

DISMISSED — The appeal fails and is dismissed.

Direct consequences and orders imposed by the Court:

  • The Court upheld the order dated 30.1.1990 cancelling the allotment made on 13.3.1981 as valid and free from legal infirmity.
  • Costs were awarded against the plaintiff-appellant in the sum of Rs. 10,000/-. The plaintiff-appellant was directed to deposit this amount with the Legal Services Authority, Haryana within two months from the date of the judgment.
  • An intimation regarding the realisation of costs was to be sent to the concerned authority, and if the costs were not deposited the case would be listed in the Urgent List (subject to any contrary order from the Supreme Court).
  • The Court refused the plaintiff-appellant's prayer for permission to challenge the administrative orders before any other forum, finding no justification for such relief and concluding that substantial justice had been done to the parties by upholding the cancellation.

Broader legal implications: The opinion applied established principles (notably the doctrine that fraud vitiates judicial acts) and relied on prior Supreme Court authorities to support its conclusion. The Court did not purport to lay down any new legal principle; it applied existing precedents to the facts and concluded that fraud disentitled the plaintiff-appellant to relief and justified non-interference with the administrative cancellation orders.

    Devi Lal v. Balwant Singh

    1. This is plaintiffs appeal filed under Section 100 of the Code of Civil Procedure, 1908 (for brevity, 'the Code') challenging concurrent findings of facts recorded by both the Courts below holding that the order of allotment authority dated 30.1.1990 cancelling allotment of the suit land did not suffer from any legal infirmity. It is appropriate to mention that order dated 13.3.1981 cancelling allotment of the surplus area was cancelled by the allotment authority vide order dated 30.1.1990 the ground that the plaintiff-appellant was not eligible to the allotment of surplus area and the allotment was obtained by making misrepresentation of facts and also by concealment of true and material facts. Order dated 30.1.1990 was upheld by the Commissioner when the appeal filed by the plaintiff-appellant "was dismissed on 15.12.1991 and the revision petition also failed before the Financial Commissioner on 22.5.1992. The plaintiff-appellant has also filed two suits being Civil Suit Nos. l516-C and 1518 of 1990-1993. The first suit was filed against the State of Haryana and other challenging the aforementioned orders of the revenue authorities which was dismissed by the Additional Senior Sub-Judge, Sirsa on 18.11.1995. The other suit was filed against Shanker etc. by making the State of Haryana as respondent in respect of land measuring 86 kanals 12 marlas which has also been dismissed on 18.11.1995 by the same Subordinate Judge at Sirsa. The defendant-respondents had sold the suit property vide sale-deed dated 27.10.1988 and a civil suit from which the instant proceedings have arisen was filed on 20.11.1994 seeking a declaration to the effect that the plaintiff-appellant is owner of land measuring 16 marlas as per jamabandi for the year 1987-88. It was further claimed that the revenue record showing to the contrary that the defendant-respondents were owners, was wrong, against law and facts and that they were in unauthorised possession. A decree for permanent injunction as a consequential relief has also been sought restraining them from raising any construction of a service station etc. As the plaintiff-appellant has already lost litigation in respect of the other allotment vide order dated 30.1.1990 as upheld by the Financial Commissioner on 22.5.1992, both the Courts below have held that the judgments and decrees dated 18.11.1995 have attained finality inasmuch as the civil Court had upheld that the allotment of surplus area in favour of the plaintiff-appellant. The argument with regard to lack of power to review has been rejected on the ground that the plaintiff-appellant obtained allotment of surplus area by playing fraud on the allotment authority which has been considered as fraud on the State and the general public.

    2. Learned counsel for the plaintiff-appellant has raised the argument that there was no power of review with the allotment authority and, therefore, the orders cancelling the allotment dated 30.1.1990, 15.12.1991 and 22.5.1992 are liable to be set aside. Learned counsel has further submitted that suit of the plaintiff-appellant could not be considered beyond the period of limitation nor it could be concluded that merely because of the allegation of fraud, the civil Court would acquire jurisdiction. Learned counsel has further argued that once the civil Court has recorded the; findings that on account of Section 26 of the Haryana Ceiling of Land Holdings Act, 1972 (for brevity, 'the Act'), the jurisdiction of the civil Court is barred, then the suit should have been decided on merits and the plaintiff-appellant should be granted an opportunity to challenge the impugned order at an appropriate forum.

    3. It is well settled that fraud transcends all barriers and no technical rules concerning jurisdiction etc. would come in the way of pronouncing against such an act. In this regard reference may be made to the observations made by the Supreme Court in the case of S.P. Chengalvaraya Naidu (Dead) by LRs v. Jagannath (Dead) by LRs and Ors. (1995-1)109 P.L.R. 293 (S.C.). It has been held that the fraud is an act of deliberate deception with the decision of securing something by taking unfair advantage of another. It is a deception in order to gain by causing loss to another. It is a cheating intended to get an advantage over the other. Referring to the celebrated observations of Chief Justice Edward Coke, their Lordships observed as under-

    Fruad 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 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 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.

    4. In the present case, it has come on record that the plaintiff-appellant was not eligible for allotment because there was land measuring 154 kanals 15 marlas in the name of the plaintiff-appellant and 26 kanals 18 marlas in the name of his wife Smt. Chando. The allotment from the surplus pool was obtained by concealing the aforementioned facts. It has been held that the State does not have unlimited land in surplus pool which deserves to be allotted to eligible persons. Accordingly, the allotment made in favour of the plaintiff-appellant vide allotment order dated 13.3.1981 was cancelled after due investigation by the allotment authority on 30.1.1990. The order has been upheld upto the Financial Commissioner. It has also been found that earlier also, the plaintiff-appellant has lost the legal battle when two Civil Suit Nos. l516-C (Exs.D4 and D5) and Civil Suit No. 1518 of 1990-1993 were dismissed. Both the judgments and decrees passed in the earlier suits would be relevant as has been held by the Supreme Court in the cases of Sahu Madho Das and Ors. v. Mukand Ram and Ors. A.I.R. 1955 S.C. 481 and Virupakshayya Shankarayya v. Neelakanta Shivacharya Pattadadevaru. A.I.R. 1955 S.C. 2187 despite the fact that the aforementioned judgments are not inter parties because both the judgments and decrees relate to the same land, same letter of allotment and same letter of cancellation. Even otherwise, the fraudulent conduct of the plaintiff-appellant has dis-entitled him to claim any relief. The order of cancellation passed by the authorities has to be upheld because those who are land-less, according to the provisions of the Act and the rules framed thereunder deserve to be allotted the surplus land. A person like the plaintiff-appellant cannot be permitted to grab the land from the surplus pool despite the fact that his wife and the father have owned huge landed prop-erty. The view of the Supreme Court in S.P. Chengalvaraya Naidu's case (supra) would fully apply to the facts of the present case. The aforementioned principle has also been followed and applied by the Supreme Court in its later judgment in the case of Ram Chandra Singh v. Savitri Devi and Rampreet Yadav v. U.P. Board of High School . Therefore, there is no room to interfere in the findings of fact recorded by both the Courts below holding that the allotment of surplus area obtained by the plaintiff-appellant is a fraudulent act as he was not eligible under the Act and the rules framed thereunder.

    5. The argument of the learned counsel that there was no power of review has not impressed me because the allotment authority before passing the order of cancellation has taken precaution of obtaining the orders from the Financial Commissioner, Revenue who enjoys suo mutu powers of review etc. under Section 18(6) of the Act. Moreover, the State Government has also issued clear instructions conferring powers of cancellation to the allotment authority in the cases of fraud. Therefore, there is no substance in the argument that the authorities under the Act did not enjoy any power of reviewing the allotment order dated 13.3.1981.

    6. The other argument that the suit is in fact within limitation does not require to be gone into. If the aforementioned argument is accepted, then the findings of fact with regard to fraudulent conduct of the plaintiff-appellant is sufficient to hold that he is not entitled to any relief and that the orders passed by the competent authority cancelling the allotment from the surplus pool is not open to any challenge. It cannot be accepted that the civil Court could not have recorded findings with regard to correctness of orders cancelling allotment of the land from the surplus pool to the plaintiff-appellant because there is no such blanket bar contemplated by Order XIV of the Code that the Court has to pronounce judgment on the preliminary issues alone. On the contrary, under Order XIV Rule 2 of the Code, it has been postulated that in cases where issues both of law and fact arise in the same suit, the Court is under an obligation to pronounce judgment on all the issues, unless it records an opinion that the case or any part thereof could be disposed of on an issues of law alone. In the present case, it has been found that the authorities under the Act have to be given free hand as long as the conduct of the plaintiff-appellant has been found to be fraudulent and, therefore, the Civil Court would not enjoy jurisdiction to interfere with such an order of cancellation of allotment because under Section 26 of the Act, the Civil Court has no jurisdiction to try a civil suit. Had the Civil Court arrived at a conclusion contrary to the fraudulent conduct of the plaintiff-appellant, then it might have been held that the authorities have not acted within the statutory limits resulting into acquisition of jurisdiction which would go beyond the bar created by Section 26 of the Act. Therefore, there is no substance in the argument raised by learned counsel for the plaintiff-appellant.

    7. For the reasons aforementioned this appeal fails and the same is dismissed with costs which is determined at Rs. 10,000/-. The prayer of the learned counsel to grant permission to the plaintiff-appellant to challenge order dated 30.1.1990 passed by the allotment authority cancelling the allotment made on 13.3.1981, order dated 15.12.1991 passed by the Commissioner, Haryana and the order dated 22.5.1992 passed by the Financial Commissioner before any other forum cannot be accepted because there is no justification and substantial justice has been done to the parties. The plaintiff-appellant shall deposit the costs awarded by this Court with the Legal Services Authority, Haryana within a period of two months from today. An intimation with regard to realisation of costs be sent to the concerned authority and in case the costs is not deposited, then the case be listed in the Urgent List, subject to any contrary orders from the Supreme Court.

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    Devi Lal v. Balwant Singh
    (Sep 12, 2005)