U.P.S.R.T.C. Thru' Regional ... vs State Of U.P. & Others
2017 Latest Caselaw 2420 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

AFR
 
Court No. - 6
 

 
Case :- WRIT - C No. - 34524 of 2003
 
Petitioner :- U.P.S.R.T.C. Thru' Regional Manager Meerut
 
Respondent :- State Of U.P. & Others
 
Counsel for Petitioner :- Avanish Mishra,J.N.Singh,S K Mishra
 
Counsel for Respondent :- C.S.C.
 

 
Hon'ble B. Amit Sthalekar,J.

Heard Sri S.K. Mishra, learned counsel for the petitioner and Sri Shashi Kant Upadhyay, learned Standing Counsel for the respondents no.1 and 2. Notice on respondent no.3 is deemed to be sufficient in pursuance of the order of this Court dated 14.07.2017.

The allegation in the writ petition is that the respondent no.3 filed Motor Accident Claim Petition (MACP) No.886 of 1999 claiming that on 11.06.1999 he was travelling in Bus No.U.P. 07-4330 and on account of the negligence of the bus driver the bus overturned. It is stated that the respondent no.3 suffered serious injuries and claimed a sum of Rs.1,95,000/- as compensation. The case was referred to the Lok Adalat, Meerut on 19.12.1999 where a judgment was passed awarding Rs.40,000/- by way of compensation to the respondent no.3. When the Uttar Pradesh State Road Transport Corporation (hereinafter referred to as Corporation) enquired into the matter, it was found that the claimant was a fraudulent and non-existing person and that the compromise had been arrived at in the Lok Adalat through fraud and collusion of the officers of the petitioner's corporation with the claimant.

In paragraph 6 of the writ petition, it is alleged that this fact was brought to the notice of the then District Judge, Meerut by the Corporation through its letter dated 25.11.2002 and also the fact that about 18 claim petitions in connection with the same accident had been filed and in one case M.A.C.P. No.245/2000, S.P. Tyagi Vs. Uttar Pradesh State Road Transport Corporation when this whole issue was highlighted, the said S.P. Tyagi withdraw the Claim Petition No.245 of 2000.

The case of the petitioner, however, is that no FIR of the accident was lodged by anyone and the addresses of all the claimants was found to be forged and the award was obtained from the Lok Adalat by practising fraud upon the Court.

In this view of the matter an application was filed on behalf of the petitioner-UPSRTC in the court below for review of the order and award highlighting the manner in which the fraud had been played upon the court and the award obtained from the Lok Adalat. This application was considered by the Additional District Judge, Court No.8, M.A.C.T., Meerut and by the order dated 01.05.2003 the Additional District Judge rejected the application on the ground that in view of the provisions of Section 21 (2) of the Legal Services Authority Act, 1987 (hereinafter referred to as the Act, 1987) award made by the Lok Adalat had already become final and was binding on all the parties to the dispute and therefore, review could not lie against the order. The court below has held that Officers of the petitioner's Corporation were present when the award was made and besides the dispute was one which was well within the jurisdiction of the Lok Adalat in view of the provisions of Section 19 (5) of the Act, 1987 and that Sri P.P. Pandey, Regional Manager, who has moved the application for review had himself signed the compromise agreement. The court below has further held that in this view of the matter, there does not appear to be any mistake in passing the award by the Lok Adalat and the compromise amount under the award had already been paid to the claimant.

Learned counsel for the petitioner submits that when the internal enquiry was held through vigilance, it came on record that no FIR had been lodged and the address of the claimant was also not existing and that the person who appeared as the claimant in the Lok Adalat was the fraudulent person and this fraud was played upon the court through the collusion of the officers of the petitioner's corporation themselves in respect of which the Assistant Law Officer, Sri Jay Prakash and the departmental Pairokar, Sri Suresh Chandra Sharma have been placed under suspension vide order dated 12.08.2002 and 03.05.2002 and that in the following departmental enquiry Suresh Chandra Sharma has already been removed from service on 18.11.2004 by the then Regional Manager, M.P. Singh. So far as Jay Prakash, Assistant Law Officer is concerned, he has shifted to Uttrakhand on bifurcation of the State and the matter has been taken up with the Uttrakhand Government.

I have gone through the records of the case. No counter affidavit has been filed by the respondent no.3 disputing the allegations in the writ petition.

When the application has been filed by the petitioner alleging that award itself has been obtained by fraud collusion of the officers of the petitioner's Corporation with the party, who appeared before the Court claiming to be the claimant such application could not have been rejected by the court below on the ground that the award has been passed in proceedings of the Lok Adalat and that it was obtained by the consent of the parties and that the amount had already been paid to the claimant. Allegation of fraud is a very serious allegation and when such fraud was played upon the court, it was the duty of the court to have addressed itself with alacrity and proper application of mind.  Award which has been obtained by fraud is no award in the eye of law and the court below has held that the proceedings under sub section 2 of section 21 of the Act, 1987 had become final between the parties. The Question is who was the claimant and if department through its internal enquiry comes to the conclusion that fraud had been played upon it through the collusion of its own officers with the person claiming to be the claimant then the department has the right to apply to the court for review of the order and there is a duty cast upon the court to examine the matter.

In (1992) 1 SCC 534 (Shrisht Dhawan Vs. Shaw Bros.) the Supreme Court in paragraph 20 has held as under:

"20. Fraud and collusion vitiate even the most solemn proceedings in any civilized system of jurisprudence. It is a concept descriptive of human conduct."

In (1994) 1 SCC 1 (S.P. Chengalvaraya Naidu Vs. Jagannath) the Supreme Court in paragraph 5 has held as under:

"5.The principle of "finality of litigation" cannot be pressed to the extent of such an absurdity that it becomes an engine of fraud in the hands of dishonest litigants. The courts of law are meant for imparting justice between the parties. One who comes to the court, must come with clean hands. We are constrained to say that more often than not, process of the court is being abused. Property-grabbers, tax-evaders, bank-loan-dodgers and other unscrupulous persons from all walks of life find the court-process a convenient lever to retain the illegal-gains indefinitely. We have no hesitation to say that a person, who's case is based on falsehood, has no right to approach the court. He can be summarily thrown out at any stage of the litigation."

In (2003) 8 SCC 319 (Ram Chandra Singh Vs. Savitri Devi and Others) the Supreme Court has held as under:

"15. Commission of fraud on court and suppression of material facts are the core issues involved in these matters. Fraud as is well-known vitiates every solemn act. Fraud and justice never dwells together.

16. Fraud is a conduct either by letter or words, which induces the other person, or authority to take a definite determinative stand as a response to the conduct of former either by word or letter.

17. It is also well settled that misrepresentation itself amounts to fraud. Indeed, innocent misrepresentations may also give reason to claim relief against fraud.

18. A fraudulent misrepresentation is called deceit and consists in leading a man into damage by willfully or recklessly causing him to believe and act on falsehood. It is a fraud in law if a party makes representations which he knows to be false, and injury ensues therefrom although the motive from which the representations proceeded may not have been bad.

23. An act of fraud on court is always viewed seriously. A collusion or conspiracy with a view to deprive the rights of the others in relation to a property would render the transaction void ab initio. Fraud and deception are synonymous."

In (2005) 6 SCC 149 (State of U.P. and Another Vs. T. Suryachandra Rao) it was held by the Supreme Court in paragraph 8 as under:

"8.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 and 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 call loss or detriment to the deceived. Even in those rare cases where there is a benefit or advantage to the deceiver, but no corresponding loss to the deceived, the second condition is satisfied."

In (2007) 7 SCC 434 (Tanna & Modi Vs. CIT, Mumbai XXV and Others) it was held by the Supreme Court in paragraph 19 as under:

"19. It is, however, also well settled that fraud vitiates all solemn acts. Fraudulent actions shall render the act a nullity. It would be non est in the eyes of law. .............."

In this view of the matter, the order dated 01.05.2003 is wholly illegal and arbitrary and is accordingly quashed.

The writ petition is allowed.

The matter is remitted to the court below who shall enquire into the matter and pass appropriate orders in accordance with law.

Order Date :- 17.7.2017/N Tiwari