Andhra Pradesh High Court - Amravati
Sadara Hotels Pvt Ltd vs Lok Adalat on 22 November, 2024
Author: R Raghunandan Rao
Bench: R Raghunandan Rao
1
RRR, J & HN, J
W.P.No.13782/2024
APHC010276222024
IN THE HIGH COURT OF ANDHRA PRADESH
AT AMARAVATI [3488]
(Special Original Jurisdiction)
FRIDAY, THE TWENTY SECOND DAY OF NOVEMBER
TWO THOUSAND AND TWENTY FOUR
PRESENT
THE HONOURABLE SRI JUSTICE R RAGHUNANDAN RAO
THE HONOURABLE SRI JUSTICE HARINATH.N
WRIT PETITION NO: 13782/2024
Between:
Sadara Hotels Pvt Ltd ...PETITIONER
AND
Lok Adalat and Others ...RESPONDENT(S)
Counsel for the Petitioner:
1. P BALAJI VARMA
Counsel for the Respondent(S):
1. GP FOR REVENUE
2. S LAKSHMINARAYANA REDDY
3.
4. MALLAVOLU NIKITHA
The Court made the following Judgment:
(Per Hon'ble Sri Justice R. Raghunandan Rao)
Heard Sri P. Balaji Varma, learned counsel appearing for the petitioner,
Sri S. Lakshminarayana Reddy, learned Standing Counsel appearing for the
1st respondent and learned G.P. for Revenue appearing for the 4th respondent.
RRR, J & HN, J
2. The case of the petitioner is as follows:
a) The petitioner entered into an agreement of sale dated
27.11.1996 with the 3rd respondent for a property, admeasuring 1600 Sq. yds,
situated at Sarojini Devi Road, Secunderabad. As the 3rd respondent was not
coming forward to execute the deed of sale, the petitioner filed O.S.No.60 of
2000 in the Court of the I Additional Chief Judge, City Civil Court,
Secunderabad, which came to be decreed on 28.04.2000, on the basis of a
compromise. As the 3rd respondent was not coming forward to execute the
deed of sale, the petitioner filed E.P.No.11 of 2006 and the Court executed a
registered sale deed dated 17.06.2006 transferring the property in favour of
the petitioner. After this, necessary mutation in the municipal records was
done by the petitioner who started paying applicable taxes, electricity and
water charges in relation to this property.
b) The petitioner, who was in continuous possession of the property
since 17.06.2006, came to know of a deed of sale dated 02.08.2022,
registered as document No.3290 of 2022, in favour of the 2nd respondent,
when the petitioner approached the municipal office for payment of property
tax. The petitioner, on further verification, came to know that this document
was executed , in favour of the second respondent, in E.P.No.32 of 2008
before the I Additional Chief Judge, City Civil Court, Secunderabad, which had
been filed by the 2nd respondent, for execution of an award dated 15.12.2005
in O.S.No.41 of 2005 passed by the Lok Adalath, Machilipatnam.
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c) The petitioner also came to know that the 2nd respondent had
again moved E.P.No.419 of 2022 before the I Additional Chief Judge,
Secunderabad, for eviction and obtaining possession of the property by the
2nd respondent. After coming to know of these developments, the petitioner
moved E.A.No.71 of 2022 in E.P.No.419 of 2022.
d) The petitioner made further enquiries in relation to O.S.No.41 of
2005 said to have been filed before the District Judge, Krishna District, at
Machilipatnam. This suit is said to have been filed, against the vendof the
Petitioner, for specific performance of an agreement of sale, dated
04.01.2984, for sale of two properties, viz., Schedule-A consisting of 3110 sq.
yds., on Sarojini Devi Road and Schedule-B consisting of Ac.3.00 in
Sy.No.512 of Pedda Guduru Village in Krishna District. After filing of the suit,
the dispute is said to have been referred to the Lok Adalath, at Machilipatnam,
where the vendor of the petitioner is said to have agreed to sell Plaint-A
schedule property while the 2nd respondent agreed not to press his claim
against plaint-B schedule property.
e) The petitioner made further enquiries regarding plaint-B schedule
property and filed an application, under the Right to Information Act, before
the concerned Tahsildar. In reply, the Tahsildar had stated that there is no
survey No.512 in Pedda Guduru Village.
f) The petitioner, on the basis of these facts, contends that a fraud
had been perpetrated on the Court and the Lok Adalath. The petitioner
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contends that the 2nd respondent deliberately moved the District Judge at
Machilipatnam by incorporating a non-existent property in the agreement of
sale. He would submit that the suit for specific performance of the alleged
agreement of sale, in relation to the property at Sarojini Devi Road, would
have to be filed before the 1st Additional District Judge, at Secunderabad and
a non-existent property was created for the purpose of conferring jurisdiction
on the District Judge, Krishna District. The petitioner contends that this
attempt to obtain a decree in a far away Court was made to ensure that the
petitioner would be unaware of the filing of this case. The petitioner also
alleges that the agreement of sale itself is a fabricated document on the basis
of which the Lok Adalath award was obtained.
3. The 2nd respondent has filed a counter affidavit disputing and
denying all the allegations made by the petitioner. It is the case of the 2 nd
respondent that the agreement of sale is a genuine agreement and the
common vendor, of the land in question, had entered into a genuine
compromise with the 2nd respondent on account of which the disputed deed of
sale had been executed in favour of the 2nd respondent. It is further contended
that the property purchased by the 2nd respondent is 3110 sq. yds. The
petitioner claims to have purchased 1620 sq. yds. As far as the remaining land
is concerned, one M/s. Kapil Consultancy Services Private Limited claiming
that it had entered into an agreement of sale, dated 27.11.1996 for an extent
of 1505 sq. yds, had filed O.S.No.121 of 2006, on the file of the I Additional
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Chief Judge, City Civil Court, Secunderabad, for specific performance of the
agreement of sale. The suit is said to have ended in a compromise, which was
recorded and a judgment was rendered, in terms of the compromise, on
25.11.2006. Subsequently, E.P.No.53 of 2006 was filed for execution of the
said judgment and decree. This resulted in a deed of sale, dated 24.02.2007,
being executed through the Court and registered as Document No.478 of
2007. On the basis of these facts, M/s. Kapil Consultancy Services Private
Limited filed W.P.No.33736 of 2014 before the Hon'ble High Court at
Hyderabad for setting aside the award, which is now being challenged in the
present writ petition. This writ petition was dismissed on the ground that the
challenge to the award should be raised in the Civil Court. Review petition
therein, in W.P.M.P.No.13757 of 2015, filed against this order, was also
dismissed on 01.09.2016. It is further contended that the very same M/s. Kapil
Consultancy Services Private Limited opposed E.P.No.32 of 2008, which had
been filed by the 2nd respondent for execution of the deed of sale, by way of a
claim petition, which was rejected by the Civil Court on 31.01.2022.
C.C.C.A.No.61 of 2022 filed against the order of the claim petition, came to be
dismissed by a Division Bench of the Hon'ble High Court of Telangana.
Aggrieved, by this order of dismissal, M/s. Kapil Consultancy Services Private
Limited approached the Hon'ble Supreme Court by way of S.L.P.(C) Diary
No.39651 of 2022, which also came to be dismissed. The 2nd respondent
contends that in view of the dismissal of the challenge to the award by M/s.
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Kapil Consultancy Services Private Limited, nothing further survives in the
present writ petition.
4. The 2nd respondent would also contend that the petitioner has
already moved E.A.No.71 of 2022 as a claim petition. It is contended that the
issues raised by the petitioner in the present writ petition can be agitated in
the said claim petition.
5. Smt. M.V. Ramana Kumari, learned counsel appearing for the 2nd
respondent would also contend that the award had been passed in the year
2005 while the present writ petition came to be filed in the year 2024, i.e., after
a lapse of 19 years. She would submit that such a challenge, after a long
lapse of time, is not maintainable. She would further contend that the entire
case of fraud is built upon the information that is said to have been obtained
under the Right to Information Act and the same is not admissible. She
contends that no material has been placed before this Court to demonstrate
fraud except to state that the award had been obtained in Krishna District
while the main property is in Secunderabad.
6. Smt. Ramana Kumari, would further contend that the suit was
maintainable in Krishna District also, as one of the properties was within the
territorial jurisdiction of the District Judge at Machilipatnam. The whole case of
the petitioner that the property in Pedda Guduru Village is a non-existent
property, is not supported by any cogent evidence placed before this Court.
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7. Sri S. Lakshminarayana Reddy, learned Standing counsel
appearing for the Lok Adalath, would contend that the writ petition itself is not
maintainable in as much as the petitioner was not a party to the award. He
would contend that only the parties to the award are entitled to challenge a
Lok Adalat award. Sri S. Lakshminarayana Reddy would rely upon Sri Durga
Malleswara Educational Society, Vijayawada vs. District Legal Services
Authority (Lok Adalath), Vijayawada 1 ; Vadiga Amose vs. Vadiga
Anjaneyulu2; and Nellore Sujannamma vs. Attipalli Nagi Reddy and Ors.,3
for this proposition. He would also contend that the laches in approaching this
Court also disentitles the petitioner from seeking any relief from this court and
relies upon P.V. Narayana vs. APSRTC, Hyderabad and Ors.,4.
8. In reply to these averments, Sri P. Balaji Varma, learned counsel
appearing for the petitioner would submit that the petitioner came to know
about the passing of the award, and the subsequent proceedings, in the year
2022 and as such there are no laches in approaching this Court. He would
also submit that the limitation and laches do not arise in a case of fraud. He
would submit that fraud obliterates all objections and question of limitation and
laches. He relies upon the judgment of the Hon'ble Supreme Court in A.V.
Papayya Sastry and Ors., vs. State of A.P. rep. by Secretary, and Ors.,5.
2012 (4) ALD 27 (DB) (para 24)
2014 (2) ALD 676 (Paras 8 & 9)
2018 (1) ALD 24 (DB)
2013 (4) ALD 386 (para 54)
(2007) 4 SCC 221
RRR, J & HN, J
Consideration of the Court:
9. At the outset, the question of Locus of the petitioner, to file this
writ Petition has to be decided. Sri S. Lakshmi Narayana Reddy, citing Sri
Durga Malleswara Educational Society, Vijayawada vs. District Legal
Services Authority (Lok Adalath), Vijayawada; Vadiga Amose vs. Vadiga
Anjaneyulu; and Nellore Sujannamma vs. Attipalli Nagi Reddy and Ors.,
would contend that the petitioner as a third party to the suit and award cannot
file a writ petition assailing the award. All the three judgments cited above
placing reliance on Balchu Subba Lakshmi vs. Sannidhi Srinivasulu6, had
held that a party to the award, can file a writ petition assailing such an award
and the only course available to a third party is to assail the award, by way of
a suit. However, it was also noticed in these judgments, that even a third party
can assail an award, by way of a writ petition, if special circumstances are
made out. These judgments have not shutout writ petitions completely. They
have only held that writ petitions, cannot be instituted normally, but such
petitions can be maintainable, on the facts of that case.
10. Both Sri S. Lakshmi Narayana Reddy as well as Smt. M.V.
Ramana Kumari, would contend that there are laches, on the part of the
petitioner, in approaching this court after a lapse of 19 years. However, the
contention of the petitioner that it had obtained knowledge of the award, only
in 2022 has not been seriously contested. Further, the challenge is on the
(2010) 1 ALT 483
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ground of fraud. In A.V. Papayya Sastry and Ors., vs. State of A.P. rep. by
Secretary, and Ors., the Hon'ble Supreme court had held :
21. Now, it is well-settled principle of law that if any
judgment or order is obtained by fraud, it cannot be said to
be a judgment or order in law. Before three centuries, Chief
Justice Edward Coke proclaimed:
―Fraud avoids all judicial acts, ecclesiastical or temporal.‖
22. It is thus settled proposition of law that a judgment,
decree or order obtained by playing fraud on the court,
tribunal or authority is a nullity and non est in the eye of the
law. Such a judgment, decree or order--by the first court or
by the final court--has to be treated as nullity by every court,
superior or inferior. It can be challenged in any court, at any
time, in appeal, revision, writ or even in collateral
proceedings.
23. In the leading case of Lazarus Estates
Ltd. v. Beasley [(1956) 1 All ER 341 : (1956) 1 QB 702 :
(1956) 2 WLR 502 (CA)] Lord Denning observed : (All ER p.
345 C)
―No judgment of a court, no order of a Minister, can be
allowed to stand if it has been obtained by fraud.‖
24. In Duchess of Kingstone, Smith's Leading Cases,
13th Edn., p. 644, explaining the nature of fraud, de Grey,
C.J. stated that though a judgment would be res judicata and
not impeachable from within, it might be impeachable from
without. In other words, though it is not permissible to show
that the court was ―mistaken‖, it might be shown that it was
―misled‖. There is an essential distinction between mistake
and trickery. The clear implication of the distinction is that an
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action to set aside a judgment cannot be brought on the
ground that it has been decided wrongly, namely, that on the
merits, the decision was one which should not have been
rendered, but it can be set aside, if the court was imposed
upon or tricked into giving the judgment.
25. It has been said : fraud and justice never dwell
together (fraus et jus nunquam cohabitant); or fraud and
deceit ought to benefit none (fraus et dolus nemini patrocinari
debent).
26. Fraud may be defined as an act of deliberate
deception with the design of securing some unfair or
undeserved benefit by taking undue advantage of another. In
fraud one gains at the loss of another. Even most solemn
proceedings stand vitiated if they are actuated by fraud.
Fraud is thus an extrinsic collateral act which vitiates all
judicial acts, whether in rem or in personam. The principle of
―finality of litigation‖ cannot be stretched to the extent of an
absurdity that it can be utilised as an engine of oppression by
dishonest and fraudulent litigants.
28. Allowing the appeal, setting aside the judgment of the
High Court and describing the observations of the High Court
as ―wholly perverse‖, Kuldip Singh, J. stated : (SCC p. 5,
para 5)
―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,
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whose case is based on falsehood, has no right to approach
the court. He can be summarily thrown out at any stage of
the litigation.‖
(emphasis supplied)
27. In S.P. Chengalvaraya Naidu v. Jagannath [(1994) 1
SCC 1] this Court had an occasion to consider the doctrine of
fraud and the effect thereof on the judgment obtained by a
party. In that case, one A by a registered deed, relinquished
all his rights in the suit property in favour of C who sold the
property to B. Without disclosing that fact, A filed a suit for
possession against B and obtained preliminary decree.
During the pendency of an application for final
decree, B came to know about the fact of release deed
by A in favour of C. He, therefore, contended that the decree
was obtained by playing fraud on the court and was a nullity.
The trial court upheld the contention and dismissed the
application. The High Court, however, set aside the order of
the trial court, observing that ―there is no legal duty cast upon
the plaintiff to come to court with a true case and prove it by
true evidence‖. B approached this Court.
28. Allowing the appeal, setting aside the judgment of the
High Court and describing the observations of the High Court
as ―wholly perverse‖, Kuldip Singh, J. stated : (SCC p. 5,
para 5)
―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
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indefinitely. We have no hesitation to say that a person,
whose case is based on falsehood, has no right to approach
the court. He can be summarily thrown out at any stage of
the litigation.‖
(emphasis supplied)
11. The award of the Lok Adalath at Machilipatnam, dated
15.12.2005 is challenged on the ground of fraud. The petitioner cannot be non
suited, at the threshold, on the ground of delay or laches.
12. The ground of fraud, raised by the petitioner, is that, O.S.No.41 of
2005, has been filed in a court, which does not have jurisdiction by
incorporating a fictitious asset in the agreement of sale to create jurisdiction.
The contention that one of the properties, viz., Schedule-B property, in the
agreement of sale, is a fictitious property is again based on the information
that is said to have been obtained by the petitioner under the Right to
Information Act. The question of whether such a property is a fictitious
property and the question of Sy.No.512 in which property is said to have been
situated, exists in Pedda Guduru Village, cannot be determined simply on the
basis of the information said to have been given by the revenue authority
under Right to Information Act. These facts would have to be pleaded and
proved before the court, by way of cogent evidence, before the court can
consider the plea of fraud. This cannot be done in the present proceedings,
initiated under Article 226 of the Constitution of India.
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13. The petitioner herein has already filed E.A.No.71 of 2022 in
E.P.No.419 of 2022. This application filed under Order XXI Rule 58 C.P.C.,
would have to be dealt with as if the said application is a plaint. This would
necessitate a full fledged trial in the matter where the petitioner would have an
opportunity to adduce necessary evidence and the 2nd respondent would have
an opportunity to rebut the said evidence.
14. Before parting with this case, the contention of the 2nd
respondent, that the issues raised by the petitioner are now covered by the
orders of this Court in W.P.No.33736 of 2014 and the orders of the Hon'ble
High Court of Telangana, in C.C.C.A.No.61 of 2022, would have to be
considered afresh, as the facts in that case are different from the present
case. In the earlier case, the Hon'ble High Court had taken note of the fact
that the applicant therein had filed its suit in 2006, after the 2nd respondent
herein had obtained his award/decree. In the present case, the petitioner
herein had filed his suit and had also obtained a decree even before the 2nd
respondent had filed a suit or obtained a decree. The significance of this fact
is a matter for decision by the Executing Court. This Court is refraining from
making any comment on this fact, as any observation by this Court would
have a conclusive effect on the issue before the Executing Court.
15. In the circumstances, it would be appropriate to dismiss this writ
petition while leaving it open to the petitioner to agitate its rights in E.A.No.71
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of 2022 in E.P.No.419 of 2022 or in any suit or proceeding that the petitioner
may choose to initiate. There shall be no order as to costs.
As a sequel, pending miscellaneous applications, if any, shall stand
closed.
R. RAGHUNANDAN RAO,J
HARINATH.N,J
Js.
RRR, J & HN, J
HONOURABLE SRI JUSTICE R. RAGHUNANDAN RAO
And
HONOURABLE SRI JUSTICE HARINATH.N
WRIT PETITION No.13782 of 2024
(Order of the Bench pronounced by RRR, J)
22nd November, 2024
Js.
