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Smart Summary

Analytical Summary of the Court's Opinion

Factual and Procedural Background

This matter arises from Suit No. 749 of 1923, brought by Bhikaji against Kulkarni seeking to set aside a decree obtained by Kulkarni in Suit No. 750 of 1918 on the ground that fraud was perpetrated on the court in the 1918 suit.

The trial Judge in Suit No. 749 found for Kulkarni, treating the matter as res judicata because the alleged new evidence had been mentioned to the High Court in a second appeal (which was eventually dismissed). The lower appellate Court in the present suit also dismissed the claim but did so on a different ground: it regarded the plaintiff's suit as an attempt at a re-hearing of the previous suit on the same allegation of perjury and therefore held that it ought not to proceed.

The plaint's particulars of alleged fraud were noted by the court to be unusually vague. Sub-paragraphs (a), (b), (c) and (f) were essentially allegations that the opponent's witnesses gave false evidence (perjury). Sub-paragraph (e) alleged deliberate concealment by the defendant of account books in the defendant's own handwriting that contained entries material to the suit.

Legal Issues Presented

  1. Whether a suit to set aside a prior decree on the ground that it was obtained by fraud is maintainable under Section 44 of the Indian Evidence Act, and if so, under what limitations.
  2. Whether allegations of perjury or false evidence in the earlier suit (as pleaded in sub-paragraphs (a), (b), (c) and (f)) amount to a basis for setting aside the earlier decree, or whether such allegations merely require a re-trial and are barred by the need for finality/res judicata.
  3. Whether the alleged suppression of account books (sub-paragraph (e)) constitutes newly discovered or suppressed evidence of such character that, if produced, it would probably have led the earlier court to a different conclusion (the test applied in Birch v. Birch).
  4. Whether the particulars of fraud in the plaint are sufficiently specific in the manner required by authorities to permit relief under Section 44.

Arguments of the Parties

Appellant (Bhikaji) — Primary contentions (as pleaded)

  • The decree in Suit No. 750 of 1918 should be set aside because fraud was perpetrated on the court in that suit.
  • Specific pleaded grounds included allegations that certain witnesses gave false evidence (sub-paragraphs (a), (b), (c), (d) and (f)).
  • Sub-paragraph (e) alleged deliberate concealment by the defendant of account books written in the defendant's own hand that contained material entries relevant to the suit.

Respondent (Kulkarni) — Primary positions (as recorded)

  • The trial Judge treated the matter as res judicata, noting that the alleged new evidence had been mentioned in the second appeal to the High Court, which was dismissed.
  • The lower appellate Court treated the present suit as an improper attempt to re-hear the previous litigation on substantially the same allegations (particularly allegations of perjury) and therefore considered it non-maintainable on that ground.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Nanda Kumar Howladar v. Ram Jiban Howladar (Sir Lawrence Jenkins) Recognizes jurisdiction to impugn a prior decree for fraud under Section 44 of the Evidence Act; such jurisdiction must be exercised with care and reserve; particulars of fraud must be clearly shown; not a licence to re-try merits (must show how, when, where and in what way fraud was committed). The court adopted Sir Lawrence Jenkins' formulation as the governing principle. Applying it, the court concluded that most of the plaint's allegations (paras (a), (b), (c), (f)) were merely perjury allegations amounting to a retrial of merits and thus should be struck out; the court left only sub-paragraph (e) (and possibly (d)) for further consideration under the stricter test.
Kadirvelu Naindr v. Kuppuswami Naiher (Full Bench, Sir John Wallis) Decision concerned allegations confined to perjury at the first trial (i.e., allegations similar to paras (a), (b), (c), (f) here) and the Full Bench's view on such allegations. The court interpreted the Full Bench decision as confined to perjury issues and expressed respectful agreement: allegations amounting only to perjury at the prior trial should not sustain a suit to impeach the prior decree.
Wyatt v. Palmer (Court of Appeal) It is dangerous and undesirable to summarily stop an action to set aside a judgment on the ground that it has been obtained by fraud; rejects the contention that there is no jurisdiction to try such an action. The decision was cited to show that jurisdiction exists to try actions to set aside decrees obtained by fraud and caution against summarily stopping such proceedings; balanced against other authorities requiring caution and specificity.
Birch v. Birch (Court of Appeal) When considering staying a second suit, the court should treat as frivolous any cause of action where the plaintiff does not produce evidence of facts discovered since the former judgment that raise a reasonable probability of success; asks whether the newly discovered fact is so evidenced and material as to make success reasonably probable (a question of degree). The court adopted the Birch test (substantially the same as Sir Lawrence Jenkins' test) to assess sub-paragraph (e): Bhikaji had to satisfy the court that the alleged suppressed accounts were such that, if produced, the probabilities are that the earlier court would have reached a different conclusion; because particulars were inadequate, the test was not met and the claim failed on facts.
Vadala v. Lawes Discussed whether a foreign judgment may be impeached on the ground of fraud and the difficulty of reconciling competing principles (finality vs. fraud). Referred to as an authority that grapples with reconciling finality of judgments and the right to impeach for fraud; used to contextualize the competing principles rather than as a direct precedent controlling the result.
Rajwant Prasad Pande v. Mahant Ram Ratan Gir (Privy Council) Holds that a suit to rescind and destroy a former decree on ground of fraud practised on courts below is maintainable; but particulars of fraud must be clearly set out. Cited by Baker, J. to support that such suits can lie but require clear particulars of fraud. Applied in evaluating the sufficiency of the plaintiff's pleadings regarding the alleged suppression of accounts and in concluding the plaintiff had not taken a sufficiently definite stand to justify relief.

Court's Reasoning and Analysis

The court proceeded by first assessing the pleadings and the procedural history: the trial Judge had regarded the matter as res judicata because the alleged evidence had been mentioned in the second appeal to the High Court (which dismissed that appeal), and the lower appellate Court rejected the present suit on the basis that it was effectively an attempt to re-hear the prior suit on the same allegations.

The court emphasized the need to limit the use of Section 44 of the Indian Evidence Act (the statutory recognition that judgments obtained by fraud may be impugned). It identified the policy tension between permitting relief for genuine fraud on the court and preserving finality in litigation. The court reasoned that if every instance of alleged perjury in a prior suit could give rise to a fresh action simply because the prior court believed the perjured evidence, there would be an end to finality and res judicata.

Applying leading authorities (notably Sir Lawrence Jenkins in Nanda Kumar Howladar v. Ram Jiban Howladar and the Birch v. Birch formulation), the court drew a distinction between two types of allegations:

  • Allegations that certain witnesses merely gave false evidence or committed perjury (sub-paragraphs (a), (b), (c) and (f)) — these amount to, in effect, a retrial of the merits and cannot be the basis for setting aside the prior decree under Section 44 unless the plaintiff can show particulars that go beyond mere general allegations of perjury.
  • Allegations that certain material evidence was deliberately concealed from the court so that the court proceeded on the basis that such material did not exist (sub-paragraph (e)) — this is the kind of case where setting aside may be appropriate, but only if the newly discovered or suppressed evidence is of such nature that it is reasonably probable the earlier court would have reached a different result. The plaintiff must give full and fair particulars of the exact nature of the evidence and what essential matters it contains that would likely produce a different result.

On the facts, the court found the plaint's particulars to be extraordinarily vague. It applied the Birch test to sub-paragraph (e) and held that Bhikaji had not supplied the necessary particulars as to the account books: their exact nature, the essential entries they contained, and how those entries would have materially affected the decision. The court also observed factual indications that undercut the plaintiff's position: the accounts in question were actually those of Rameharan Beharilal (in whose business Kulkarni had an interest), and in sanction proceedings the plaintiff admitted to having copies but did not produce them or press for production of the originals in the Poona proceedings. The court concluded that the plaintiff's failure to make a definite stand (for example, by producing copies and asserting that originals could be called for from the Poona Court) cast suspicion on his claim and deprived him of a strong position.

Consequently, the court held that most of the pleadings amounted to attempts at retrial of the merits and should be struck out, and that the plaintiff had failed to meet the narrower test for relief based on suppressed documents. Both the Chief Justice and Baker, J. concurred in these conclusions.

Holding and Implications

Holding: The appeal is dismissed and the order of the lower appellate Court dismissing the suit is upheld.

Implications:

  • Direct effect: The plaintiff Bhikaji's suit (No. 749 of 1923) to set aside the decree obtained in Suit No. 750 of 1918 was dismissed; the decree obtained by Kulkarni stands.
  • The court reaffirmed established limits on actions under Section 44 of the Indian Evidence Act: general or vague allegations of perjury that amount to asking for a re-trial of the merits will not sustain a suit to impeach a prior decree. Allegations of suppressed documentary evidence may permit relief only where the document is shown with sufficient particularity and is of such character that it would probably have led to a different result.
  • No broader change in law was announced by the court; the decision applies the accepted tests from prior authorities to the facts before it and emphasizes the requirement of clear, specific particulars when alleging fraud practiced on the court.

Disposition recorded in the opinion: "Appeal dismissed." (per the text of the opinion)

    Bhikaji Mahadev Gund v. Balvant Ramchandra Kulkarni

    Marten, C.J:— The present suit, No. 749 of 1923, is brought by one Bhikaji against one Kulkarni to set aside a decree obtained by Kulkarni in Suit No. 750 of 1918. The ground is that a fraud was perpetrated on the Court in the 1918 suit. The trial Judge, in the present case, has found in favour of Kulkarni, because he considered the matter was res judicata seeing that the alleged new evidence was mentioned to the High Court in second appeal before the High Court eventually dismissed that second appeal. The lower appellate Court, in the present suit, arrived at the same conclusion, not on the ground of res judicata, but on a different ground. The learned Judge held, in effect, that the present suit was an attempt to have a re-hearing of the previous suit on the same allegation of perjury, and that consequently on that ground it ought not to proceed. Looking at the plaint in the present case, it will be found that the particulars of the alleged fraud, as set out in para. 3, are extraordinarily vague. Sub-paras (a) (b) (c) (d) and (f) practically amount to this: that the opponent's witnesses gave false evidence. The other sub-para. (e) runs as follows:

    The defendant deliberately and falsely eoncealed from the Court the account books, written by the defendant in his own hind, and which contained entries that would have been material to the disposal of the suit by the Court.

    2. A considerable number of authorities have been cited to us with reference to Section 44 of the Indian Evidence Act, which provides that any party to a suit may show that any judgment was obtained by fraud. It is clear that some limitation must be put upon that section. For instance, if party A and his witnesses in a particular suit came into the box and committed deliberate perjury on material points, that is clearly fraud. On the other hand, if a decree is eventually passed in favour of that party, even on that perjured evidence, it cannot be open for the opponent to start a new action on exactly the same evidence, on the sole allegation that the previous evidence was wrongly believed by the Court. If that were so, there would be an end to the doctrine of res judicata. There would be no finality in litigation, because either party might alternatively bring these cross-actions with varied results ad infinitum. Consequently, the authorities show, I think, that if the case merely turns on, in effect, a re-hearing of the previous suit on substantially the same evidence, then the Court will not hear the second suit. On the other hand, it is to my mind clear that in a proper case the Court has jurisdiction to set aside a decree which has been obtained by fraud practised on the Court. If, for instance, the existence of certain evidence has been stoutly denied by one party, and the Court has been induced to frame its decree on the basis that evidence did not exist, then, if that evidence is afterwards discovered, and it is of such a nature that if it had been before the first Court, the probabilities are that the Court would have arrived at a different conclusion, then, it may be, when all the circumstances are looked at, that in that case the Court would set aside the original decree. In Nanda Kumar Howladar v. Ram Jiban Howladar(1) Sir Lawrence Jenkins stated the law with his characteristic lucidity. He says (p. 998):

    The jurisdiction to impugn a previous decree for fraud is beyond question: it is recognized by Section 44 of the Evidence Act and is confirmed by a long line of authority. But it is a jurisdiction to be exercised with care and reserve, for it would be highly detrimental to encourage the idea in litigants that the final judgment in a suit is to be merely a prelude to further litigation.

    3. Then lower down he says:

    A prior judgment, it has been said, cannot be upset on a mere general allegation of fraud or collusion; it must be shown how, when, where and in what way the fraud was committed.

    4. Then on, p. 999, he says:

    There is, however, no suggestion that the decree in the previous suit was fictitious, or that the plaintiffs in this suit were prevented by contrivance from placing before the Court in the former suit any material relevant to the issue, nor has there been any subsequent discovery of evidence that goes to show fraud, or that the Court was misled in the former suit. In effect, when analyzed, the judgment of the lower appellate Court is no more than a retrial of the merits of the original suit and a determination that the Judge who decided that suit was mistaken. But the Court in this suit has no jurisdiction to decide on the merits of the former judgment; its function is to decide whether that judgment was vitiated by fraud.

    5. As regards the Full Bench decision in Kadirvelu Naindr v. Kuppuswami Naiher(2), in which the opinion of the Court was delivered by Sir John Wallis, I understand that decision to relate to a case which was confined to questions of perjury at the first trial. In other words, the case related solely to allegations like those we get in paras. (a) (b) (c) and (f) of the present plaint. This, I think, will be seen to be so on looking at the allegations made in the pleadings at p. 744 of the report. In that view of the case, I would respectfully agree with the opinion of the Full Bench. Next, if one turns to the English authorities, the law has been considered on several occasions, and I may refer to two cases both in the Court of Appeal. Wyatt v. Palmer(3) is a case on one side of the line, where the Court thought that the suit ought not to be summarily stopped. Lord Lindley said (p. 110):

    As a general proposition, I think it dangerous and undesirable to summarily stop an action to set aside a judgment on the ground that it has been obtained by fraud.

    6. And the learned Judge then overruled the contention that there is no jurisdiction in the Court to try an action to set aside a decree obtained by fraud.

    7. On the other hand, in Birch v. Birch(4), which was also a case of stopping a second suit in limine, the Court of appeal stayed the second suit on certain further evidence and reversed the decision of Mr. Justice Gorell Barnes, which was to the contrary effect. There, Lord Justice Vaughan Williams says (p. 136):

    I think that the Court ought to treat as frivolous and vexatious any cause of action in support of which the plaintiff does not produce evidence of facts discovered since the former judgment which raise a reasonable probability of the action succeeding.

    8. Then lower down he says:

    In each case it is a question of degree. Is the fact alleged to have been discovered so evidenced and so material as to make it reasonably probable that the action will succeed? If it is, I think the action ought not to be stayed.

    9. Lord Justice Cozens-Hardy, as he then was, at p. 139 says:

    If the present plaintiff were appealing, and all questions of time were got rid of, he might apply for leave to adduce further evidence on the appeal. But I think such an application must have failed, Such a document as the alleged confession, which cannot be adduced in evidence, must be wholly disregarded. No documentary evidence recently discovered is suggested. A mere suspicion is not sufficient. The supposition which I have made of an appeal, coupled with an application to adduce fresh evidence, is probably too favourable to the present plaintiff. Certainly the plaintiff cannot be in a better position when he seeks to set aside a solemn judgment. The importance of finality in litigation is very great; and I think it would be wrong to allow the issue to be again tried between these parties as to the validity of the will, which has been admitted to probate.

    10. The suit was accordingly stayed.

    11. I may refer to another case of Vadala v. Lawes(5), where the Court, in dealing with the question as to whether a foreign judgment may be impeached on the ground of fraud, and holding that it may, goes into the question at page 316 of the difficulty of reconciling the two competing principles.

    12. Applying what has been laid down in Nanda Kumar Howladar v. Ram Jiban Howladar, by Sir Lawrence Jenkins, as the law, which, speaking for myself, I respectfully accept, all the allegations of fraud in the plaint in the present case would have to be struck out, except sub-paragraph (e), and possibly sub-paragraph (d). Sub-paragraphs (a) (b) (c) and (f) merely amount to allegations that the witnesses in the previous suit committed perjury. To try that would really involve retrial. Consequently, at any rate, as regards those particular paragraphs, I would hold that the judgment of the lower appellate Court was correct.

    13. Similarly, in the view I take, I think it would not be open under the present circumstances for Bhikaji to litigate over again the question now raised in subparagraph (d). We are, therefore, left with sub-paragraph (e). Now here to adopt the test in Birch v. Birch, which is substantially the same test as that adopted by Sir Lawrence Jenkins, Bhikaji has to satisfy us that this alleged suppressed evidence was of such a character that if it had been produced the probabilities are that the Court in the other suit would have arrived at a different conclusion. To do that the plaintiff should have given, in my judgment, full and fair particulars of the exact nature of these account books, and what essential matters they contained which would have been likely to produce a different result to the litigation. (His Lordship then dealt with the questions of fact and dismissed the appeal.)

    14. Baker, J.:— I agree with my Lord the Chief Justice, and have very little to add to his exhaustive judgment. In regard to this country the law is laid down by Sir Lawrence Jenkins in Nanda Kumar Howladar v. Ram Jiban Howladar and also by the Privy Council in Rajwant Prasad Pande v. Mahant Ram Ratan Gir(6), where their Lordships say (p. 761):

    This suit… is equivalent to a suit for the rescission and destruction of a former decree of a competent Court. That rescission and destination could be obtained on the ground of fraud “practised on the Courts below.” On the authorities, therefore, I entertain no doubt that such a suit could lie. It is a fundamental maxim that particulars of fraud must be clearly set out. The fraud alleged, on which the present suit is based, is, according to the plaint, the suppression by Kulkarni the plaintiff in the former suit, of his accounts. It now appears that the accounts referred to are not the accounts of Kulkarni himself, but the accounts of one Rameharan Beharilal, in whose business Kulkarni is stated to have an interest.

    15. In the sanction proceedings before the Sub-ordinate Judge of Khed—not the same Sub-ordinate Judge who tried the suit—the fact that the accounts of Kulkarni had been produced in Suit No. 1080 of 1921 of the Poona Sub-ordinate Judge's Court, does not appear to have been clearly set out. It appears to me that, if the present plaintiff had relied on the fraud which he now alleges, namely the suppression of accounts by the opponent Kulkarni, he should have taken a much more definite stand on the point. It appears from the proceedings that he admitted the possession of copies of the accounts, but he did not produce those copies with the object of showing that the claim against him was false, or, what is more important, for the purpose of supporting an application for the production of the original account books which were in the possession of the Poona Court filed in Suit No. 1080 of 1921. It appears to me that if the plaintiff had said:

    I am in a position to prove that these accounts have been suppressed, I can produce copies of them, a the originals are with the Court of Poona, and can be called for, he would have been in a very strong position, and it would have been difficult for the Court to refuse to call for the original accounts. But the plaintiff, for reasons beat known to himself, did not choose to adopt this attitude, and this throws a cloud of suspicion on his case. In these circumstances I do not think that this is a suit of the nature covered by the section of the indian evidence act referred to. I agree that the order of the lower appellate Court dismissing the suit should be upheld.

    16. Appeal dismissed.

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    Bhikaji Mahadev Gund v. Balvant Ramchandra Kulkarni
    (Jan 28, 1927)