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Citation Codes
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citation codes
Case Number
Attorney(S)
Judges
Acts
  • Art. 91 or 92 of the Limitation Act,
  • Art. 95 of the Limitation Act
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
Judges
Acts
  • Art. 91 or 92 of the Limitation Act,
  • Art. 95 of the Limitation Act
Smart Summary

Structured Summary of the Opinion

Factual and Procedural Background

Defendant No. 3 (the mortgagee) brought mortgage Suit No. 79 of 1914 against the Plaintiffs and obtained an ex parte decree. Property sold in execution of that decree was purchased by Defendant No. 1 (the auction‑purchaser), who took symbolic possession on 20 February 1916.

The Plaintiffs filed the present suit on 28 February 1920 seeking confirmation of their possession after declaration of their title or, alternatively, recovery of possession after declaring the mortgage decree and auction sale fraudulent and void and, if necessary, setting aside the decree. In their plaint the Plaintiffs alleged that they only came to know of the decree on 10 December 1918.

At first instance the trial Court accepted the Plaintiffs' statement of knowledge and, finding the decree and sale fraudulent, decreed for all properties described in two schedules (Schs. (ka) and (kha)). On appeal the Subordinate Judge found that the mortgage bond had been interpolated in respect of the lands in Sch. (ka) (making the decree and sale as to those lands void), but that the lands in Sch. (kha) had been validly mortgaged and the suit should be dismissed so far as those lands were concerned. The Subordinate Judge also addressed limitation, holding Art. 95 of the Limitation Act applicable and recording a finding that the Plaintiffs had knowledge of the decree and sale on 20 February 1916.

The appeals now before the Court raised primarily the question of limitation and the legal effect of a decree obtained by fraud.

Legal Issues Presented

  1. Whether the Plaintiffs' suit to obtain relief from a decree and sale alleged to be fraudulent is barred by limitation under Article 95 of the Limitation Act, measured from the Plaintiffs' date of knowledge of the decree and sale.
  2. Whether a decree obtained by fraud (but by a Court having jurisdiction) and a sale in execution of such a decree are void or merely voidable, and the consequences of that characterization for the remedies available to a party to the decree.
  3. Whether the Plaintiffs could avoid the requirements of Articles 91, 92 or 95 by casting their action as a declaratory suit (relying on the residuary article, Article 120), rather than a suit to set aside the decree and sale.

Arguments of the Parties

Defendants-Appellants / Auction-purchaser (Appellant in S.A. No. 1253 of 1922)

  • The only point pressed on behalf of the Defendants-Appellants was limitation: Art. 95 of the Limitation Act applies to a suit challenging a decree and sale obtained by fraud.
  • The auction-purchaser (Appellant in S.A. No. 1253) contended that he was a third party who neither participated in nor colluded in the fraud, and that the relevant reliefs were subject to the limitation period under Art. 95 measured from the Plaintiffs' knowledge of the decree and sale.
  • On appeal before this Court the auction‑purchaser argued that the lower Appellate Court's finding that the Plaintiffs had knowledge more than three years before suit meant the suit was barred under Art. 95.

Plaintiffs / Respondents (including the Appellant in S.A. No. 1347 of 1922 when characterized as the mortgagee)

  • The Plaintiffs alleged that they became aware of the decree and sale only on 10 December 1918 (within three years of the suit date) and framed the suit accordingly.
  • The Respondents argued before this Court that Art. 95 was not applicable and that instead the residuary Article (Art. 120) applied, characterizing the present action as a declaratory suit rather than one to set aside the decree and sale.
  • The Respondents maintained that the suit was for a declaration that the decree and sale were not binding on them and that they remained in possession, attempting thereby to avoid the specific limitation periods that would apply to a direct attack on the decree.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Ram Sana Chaudhurani v. Sana Mala Chaudhurani Establishes that a judgment rendered by a Court having jurisdiction over the parties and subject‑matter is binding and not open to collateral attack unless reversed or annulled in an appropriate proceeding; only judgments void for want of jurisdiction are nullities. The Court relied on this authority to support the proposition that a decree passed with jurisdiction, even if tainted by fraud, is not void but voidable and cannot be impeached in a collateral proceeding; it must be set aside in an appropriate action before its effects can be removed.
Raj Kumar Sarkel v. Raj Kumar Mali Holds that a sale in execution of a fraudulent decree is not void but voidable; until the decree is set aside by appropriate proceedings, the rights created by the sale remain effective. The Court applied this principle directly, noting that where the right to have a decree set aside as fraudulent becomes barred by limitation, the sale executed under that decree cannot be set aside in isolation and the purchaser's rights subsist until the decree is annulled.
Bejoy Chand Mahtab v. Asutosh Chukraberty Affirms the view that a decree obtained by fraud is voidable, and related rulings on the necessity of vacating a decree in appropriate proceedings before obtaining certain consequential reliefs. The Court cited this case as an example of rulings adopting the same view; it reinforced the conclusion that the Plaintiffs could not obtain the relief sought without first removing the obstacle of the decree in a properly constituted proceeding within the period of limitation.

Court's Reasoning and Analysis

The Court's analysis proceeded along distinct legal and factual lines:

  1. Characterization of a decree obtained by fraud: The Court emphasized the settled legal principle that a transaction or decree tainted with fraud is generally voidable and not void where the Court that passed the decree had jurisdiction over the subject-matter and parties. Only judgments that are void for want of jurisdiction are nullities and open to collateral attack. The Court cited Ram Sana Chaudhurani and similar authorities to support this position.
  2. Consequences for sale in execution: Building on the view that a decree is voidable, the Court held that a sale in execution of a fraudulent decree is likewise voidable rather than void. Until the decree is set aside in appropriate proceedings, the rights created by the sale remain operative. The Court relied explicitly on Raj Kumar Sarkel v. Raj Kumar Mali and Bejoy Chand Mahtab v. Asutosh Chukraberty for this principle.
  3. Limitation (Article 95): The Court accepted the premise that Art. 95 of the Limitation Act applies to suits seeking to set aside a decree and sale obtained by fraud and that the relevant limitation period runs from the plaintiff's knowledge of the fraud/decree/sale. The Subordinate Judge had framed the issue as whether the Plaintiffs were within three years of their date of knowledge.
  4. Factual determination of knowledge: The Subordinate Judge found as a fact that the Plaintiffs knew of the decree and the sale on 20 February 1916 (the date of symbolic possession being delivered), whereas the Plaintiffs had alleged knowledge from 10 December 1918. The Court accepted the lower Appellate Court's finding on this factual point.
  5. Effect of framing the suit as declaratory: The Plaintiffs/Respondents attempted to avoid Art. 95 by framing their suit as declaratory (relying on Art. 120). The Court rejected this attempt as an evasion of statutory provisions. It explained that permitting a party to a decree to obtain a merely declaratory judgment that a decree is not binding — without first setting aside the decree in appropriate proceedings — would render the statutory limitation provisions nugatory. The Court distinguished cases where a plaintiff not party to the transaction might seek a declaration without first setting aside the transaction; that reasoning did not apply where the plaintiff was a party to the decree.
  6. Conclusion from law and fact: Applying the legal principles to the facts (voidable nature of the decree, necessity of setting it aside, applicability of Art. 95, and the factual finding of knowledge in February 1916), the Court concluded that the Plaintiffs failed to institute the appropriate proceedings within the period of limitation and therefore lost their right to attack the decree and sale.

Holding and Implications

Holding (core ruling): Both appeals are allowed; the decrees of the Courts below are set aside and the Plaintiffs' suit is dismissed.

Direct consequences and costs:

  • The appeals succeed and the decrees granted in favour of the Plaintiffs in the Courts below were set aside.
  • The Plaintiffs' suit challenging the decree and sale was dismissed on the ground that it was barred by limitation under Article 95, having regard to the Court's finding as to the Plaintiffs' date of knowledge (20 February 1916).
  • Costs were awarded as follows: in S.A. No. 1253 of 1922 the Appellant will get his costs in all the Courts; in S.A. No. 1347 of 1922 the Appellant will not get her costs in any Court.

Broader implications:

The opinion explains and applies established principles concerning the distinction between void and voidable decrees obtained by fraud and the necessity for a party to set aside such decrees by appropriate proceedings within the statutory period of limitation. The Court did not purport to lay down a novel rule of law beyond applying existing authorities to the facts of this case. No broader novel precedent or alteration of existing law is discussed beyond the direct effect on the parties here.

    Ambikamoni Dasi v. Khettra Ghosai

    The Judgment of the Court was as follows:—

    Suhrawardy, J.:— The facts of this case are that Defendant No. 3 brought a suit (being mortgage suit No. 79 of 1914) against the Plaintiffs and obtained an ex parte decree against them in execution of which the property in suit were sold and purchased by Defendant No. 1 who obtained symbolical possession of the properties on the 20th February 1916. The present suit was brought on the 28th February 1920 in which the Plaintiffs prayed “to have their possession confirmed after declaration of their alleged title to the lands in suit or in the alternative for recovery of possession of the disputed lands, after declaration that the decree in the mortgage suit No. 79 of 1914 and the auction sale in execution thereof were fraudulent and void, and if necessary, after setting aside the decree.” One of the pleas raised by the Defendants was that of limitation and that is the only point pressed before us on behalf of the Defendants-Appellants. The Plaintiff in his plaint alleged that he came to know of this decree on the 10th December 1918. The first Court accepted that statement and finding that the decree and sale were fraudulent gave the Plaintiffs a decree for all the properties in suit which were described in two schedules being Schs. (ka) and (kha). The Defendant No. 3 appealed and the learned Subordinate Judge found that in the mortgage bond the property described in Sell, (ka) was fraudulently interpolated and therefore the decree obtained by the Defendant on the strength of the bond so far as it related to that property was void as also the sale held under that decree. Regarding the properties described in Sch. (kha) he found that the properties were mortgaged to the Defendant under the bond and therefore so far as the properties of that schedule were concerned the suit should be dismissed.

    As regards Sch. (kha) the learned Subordinate Judge observes that the auction-purchaser is a third party and he was not a party to the fraud by which the decree was obtained nor did he collude with the other Defendants; so the Plaintiff cannot recover possession of the land described in Sch. (kha) unless he gets the sale and the decree set aside; and he thought that Art. 95 of the Limitation Act applied to the case. After making these observations the learned Judge raises the issue:— So the question is if the Plaintiffs are within three years of the date of their knowledge of the fraud, i.e, the forgery in the bond. On this issue he records his finding in these words: “In fact I am convinced that they (the Plaintiffs) knew of the same (the decree and the sale) on the 20th February 1916 when the symbolical possession was delivered and the Defendants wanted them to vacate the bastu. This suit is brought on the 28th February 1920. Therefore the suit is evidently after three years from the date when the Plaintiffs knew of that fraud.” As to Sch. (ka) the learned Subordinate Judge is of opinion that as the land described in that schedule was interpolated in the mortgage bond after its execution, “the decree and sale have not affected the lands of Sch. (ka).” The learned Judge seems to think that different legal considerations should apply to different portions of the decree obtained by the Appellant. If this is the view taken by the learned Judge it must be held to be wrong. A transaction tainted with fraud is voidable and not void. A decree obtained by fraud, collusion or any other unlawful means is a pronouncement of a Court of Justice and it cannot be treated as a waste paper. The only objection that can be made to a decree as being void or a nullity must be on ground that it was passed without jurisdiction or that the Court which passed it had no territorial or pecuniary jurisdiction over the subject-matter of the suit. It is conceded that the Court which passed the mortgage decree had jurisdiction over the properties in suit and was pecuniarily competent to try it. That decree therefore is a decree which is binding upon all the parties to the suit unless set aside in a properly constituted proceeding. The view that a decree passed with jurisdiction, however tainted it may be with fraud, is not void, hardly needs any support from authorities; for it has been repeatedly held that a Plaintiff will not succeed in obtaining any relief before he, if the decree passed against him was by a competent Court, gets it vacated. Reference may be made to the case of Ram Sana Chaudhurani v. Sana Mala Chaudhurani (1), where it is observed “that a judgment rendered by a Court having jurisdiction over the parties and the subject-matter, unless reversed and annulled in some appropriate proceeding, is not open to contradiction or impeachment in respect of its validity or binding effect by parties or privies in any collateral action or proceeding. The position is different when a judgment shows on its face that it is void for want of jurisdiction either of the person or the subject-matter. Such a judgment is treated as a nullity, collaterally impeachable by any person interested wherever it is brought in question.” The same view has been expressed in the case of Raj Kumar Sarkel v. Raj Kumar Mali (2), where it was held that a sale in execution of a fraudulent decree is not a void but a voidable sale; till vacated by an appropriate proceeding, the rights created thereby are effective. In that case which covers a greater part of the points raised in this case, the sale was sought to be set aside on failure to set aside the decree; and the learned Judges held “that it was essential that the Plaintiffs should seek, as they did in their plaint, to have the decree set aside on the ground of fraud before they could have the sale vacated. Consequently where the right to have the decree set aside as fraudulent has become barred by limitation, no decree can be made setting aside the sale only as made in execution of a fraudulent decree and as the Plaintiffs have lost their right to attack the decree, they cannot consequently attack the sale.” This view has been adopted in many rulings, one of which may be referred to, viz., the case of Bejoy Chand Mahtab v. Asutosh Chukraberty (3). The result of all these authorities is that the Plaintiffs cannot get the relief which they seek to obtain in this case before they get rid of the decree which stands in the way. According to the findings of the learned Judge the Plaintiffs came to know of the existence of the decree and the sale more than three years before the date of the institution of the suit which is a suit to all intents and purposes for setting aside the decree and the sale. The decree and the sale being only voidable, they must be avoided within the period of limitation fixed by statute. But it is argued on behalf of the Respondent that the suit was only one for a declaration that the decree and the sale were not binding on the Plaintiffs and therefore it may be treated as a declaratory suit. This is an attempt to evade the clear provisions of law. To hold that the Plaintiffs are entitled to have a declaration that a certain decree is not binding against them though they were parties to such proceedings would be to make nugatory such provisions of the law which makes it obligatory on a party to set aside the decree and the sale in order to remove an impediment which stands in the way of his obtaining the relief he seeks. For instance, the Plaintiff, to avoid Art. 91 or 92 of the Limitation Act, may not seek to have the instrument which purports to have been executed by him cancelled or set aside but may merely sue for a declaration and possession of property or other ancillary reliefs. This he cannot be allowed to do. It cannot be said that the Plaintiff is entitled to regard the transaction to which he is said to be a party a nullity.

    I am conscious of the view taken in some cases that there are cases where the Plaintiff may not be required to remove an apparent obstruction to his right before he seeks possession of the property from which he has been dispossessed. But the view taken in such cases is based upon a different ground. In the present case the Plaintiffs were parties to the transaction or proceeding; but in a case in which the Plaintiff is not such a party he may not be bound to have the transaction set aside; he may ask for a declaration that it is not binding on him. But where there is a judgment of a Court against him he cannot succeed unless he gets the hindrance removed. In the view I take of this case, the decree and the sale were not absolutely void but were voidable and the Plaintiff not having sought the proper remedy within three years from the date of his knowledge, i.e, 20th February 1916, the present suit for setting aside the decree and the sale thereunder is barred and therefore the Plaintiffs have lost their right.

    The result of the above consideration is that these appeals succeed, the decrees of the Courts below are set aside and the Plaintiffs' suit dismissed. In S.A No. 1253 of 1922 the Appellant will get his costs in all the Courts but in S.A No. 1347 of 1922 the Appellant will not get her costs in any Court.

    Duvau, J.:— I agree that these appeals must be allowed. The facts shortly are as follows:— The Respondents are the mortgagors and the Appellant in S.A No. 1347 of 1922 is the mortgagee. The latter brought a suit in 1916, obtained an ex parte decree on her mortgage, and put the properties to sale which were purchased by the Appellant in S.A No. 1253 of 1922. Thereafter this latter Appellant as auction-purchaser took symbolical possession on the 20th February 1916 and the present suit was brought on the 28th February 1920. The Plaintiffs-Respondents' case was that as a matter of fact one of the items in the schedule of the mortgage deed was fraudulently interpolated after the mortgage was executed. They brought the suit on the 28th February 1920 alleging before the Munsif that they only came to know of the decree and the sale on the 10th December 1918, i.e, within three years of the date of the suit. It is clear therefore that the suit as framed recognises that Art. 95 is the appropriate article. The learned lower Appellate Court, however, has found that as a matter of fact they were aware of the fraudulent decree more than three years before the suit was instituted. The lower Appellate Court also found (disagreeing with the first Court) that the Appellant in S.A No. 1253 of 1922 (the auction-purchaser) neither had any previous knowledge of any fraud in the decree nor acted in collusion with the Appellant in S.A No. 1347 of 1922. The only argument addressed to us on behalf of the Appellant is that a3 Art. 95 is the article applicable and as the learned lower Appellate Court has found that the Plaintiff had knowledge of the decree more than three years before he brought the suit, the suit is barred under that article. In this Court a defence is set up on behalf of the Respondents that as a matter of fact Art. 95 is not applicable but another article, namely, the residuary article, i.e, Art. 120 applies, and the learned vakil for the Respondents has argued that this is not a suit to set aside the decree but a suit for declaration that the decree and the sale under it are not binding on them: it is only a declaratory suit and the Plaintiff is still in possession. The only point therefore that appears to me to be arguable is whether, on the form of the suit as framed, this suit is one to set aside a decree. My learned brother has dealt with that point and I agree with him in his finding that it is a suit to set aside the decree passed in Suit No. 79 of 1914 and that the Plaintiffs cannot get over the limitation of three years by arguing that it is a suit for a mere declaration or that it is a case for declaration with certain reliefs. I therefore agree with my learned brother that both the appeals must be allowed.

    S.C.M

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    Comments

    Ambikamoni Dasi v. Khettra Ghosai
    (Mar 19, 1925)