It is really good to note that the Supreme Court has once again reiterated in a learned, laudable, landmark and latest judgment titled Ram Kumar vs. State of Uttar Pradesh And Ors. in Civil Appeal No. 4258 of 2022 and cited in 2022 LiveLaw (SC) 806 that was pronounced as recently as on September 28, 2022 that a judgment or decree obtained by fraud is to be treated as a nullity. The Bench of Apex Court comprising of Justice BR Gavai and Justice CT Ravikumar minced absolutely no words to observe that, “Non-disclosure of the relevant and material documents with a view to obtain an undue advantage would amount to fraud.” In this case, it must be mentioned that the Allahabad High Court had set aside the order passed by the Deputy Collector of Rasoolabad cancelling the fair price shop licence of the writ petitioner. It was found that the cancellation was done without following the full-fledged inquiry process.
At the very outset, this brief, brilliant and balanced judgment authored by Hon’ble Mr Justice BR Gavai for a Bench of Apex Court comprising of himself and Justice CT Ravikumar sets the ball rolling by first and foremost putting forth in para 1 that, “This appeal challenges the judgment and order of the High Court of Judicature at Allahabad dated 21st February 2019 thereby allowing the writ petition filed by respondent No. 9 herein, setting aside the order dated 18th November 2017 passed by the Deputy Collector, Rasoolabad cancelling the fair price shop licence of respondent No. 9 and the order dated 20th July 2018 passed by the Additional Commissioner (Judicial), Kanpur Division, Kanpur, (hereinafter referred to as “the Appellate Authority”) dismissing the appeal of respondent No.9 and restoring the Fair Price Shop licence to the respondent No.9 forthwith.”
To put things in perspective, the Bench then envisages in para 2 that, “The facts, in brief, giving rise to the present appeal are as under: 2.1 Respondent No.9 herein-Kiran Devi (the original writ petitioner) was granted a licence for running a fair price shop at Gram Panchayat Anta, Tehsil Rasoolabad, District Kanpur Dehat. Various complaints were received by the Sub-Divisional Officer, Rasoolabad, District Kanpur Dehat (hereinafter referred to as “the SDO”), with regard to malpractices committed by the said fair price shop dealer. As such, a site inspection of the fair price shop was done on 3rd June 2017 through the Regional Supply Inspector. In the site inspection also, various irregularities and malpractices were found in the running of the said fair price shop. As such, a show cause notice came to be issued to respondent No.9 by the SDO on 7th July 2017. Initially, on the date fixed, respondent No.9 did not file her explanation. Subsequently, she submitted her explanation on 16th August 2017.”
As it turned out, the Bench then discloses in para 2.2 that, “Thereafter, an inquiry was conducted by the SDO. Various statements were recorded. At the conclusion of the inquiry, the SDO found the charges to be proved and as such, vide order dated 18th November 2017, cancelled the Fair Price Shop licence of respondent No.9.”
As we see, the Bench then lays bare in para 2.3 stating that, “Being aggrieved by the order passed by the SDO, respondent No.9 carried an appeal to the Appellate Authority. The said appeal also came to be dismissed by the Appellate Authority vide order dated 20th July 2018.”
Be it noted, the Bench then mentions in para 2.4 that, “It is to be noted that, in the meantime, licence to run the said fair price shop was granted in favour of the present appellant-Ram Kumar vide order dated 15th May 2018. This was done on the basis of the decision taken by the Tehsil Level Selection Committee dated 19th April 2018. This fact was specifically noted in the order of the Appellate Authority dated 20th July 2018.”
Needless to state, the Bench then brings out in para 2.5 that, “Being aggrieved by the aforesaid order passed by the Appellate Authority, respondent No.9 preferred a writ petition before the High Court of Judicature at Allahabad being Civil Misc. Writ Petition No. 29832 of 2018.”
It merits mentioning that the Bench then points out in para 2.6 that, “The High Court came to a finding that the cancellation of the Fair Price Shop licence of respondent No.9 was done without following the full-fledged inquiry process and, therefore, relying on the Full Bench decision of the Allahabad High Court in the case of Puran Singh vs. State of U.P. and others (2010) 2 UPLBEC 947 = 2010 SCC OnLine All 2707, allowed the writ petition as aforesaid.”
To say the least, the Bench then observes in para 2.7 that, “Being aggrieved thereby, the present appeal.”
Do note, the Bench then reveals in para 4 that, “Mr. Udayaditya Banerjee, learned counsel, submits that though respondent No.9 was very well aware that during the pendency of the appeal before the Appellate Authority, the licence to run the fair price shop was allotted to the present appellant, she has not only suppressed the said fact in the writ petition but has also made a statement which is totally false to her knowledge. It is submitted that, on this short ground of non-joinder of the appellant in the proceedings before the High Court, the present appeal deserves to be allowed. He relies on the judgment of this Court in the case of Pawan Chaubey vs. The State of Uttar Pradesh & Ors. (Civil Appeal No.3668 of 2022, decided on May 6, 2022) in support of his submission that the appellant being the subsequent allottee was a necessary party and as such, the impugned judgment and order of the High Court, without impleading him as a party, is not sustainable in law.”
It cannot be glossed over that the Bench then deems it apposite to mention in para 14 that, “It is further to be noticed that in the said case, i.e., Pawan Chaubey (supra), the order of appointment of the appellant therein was subject to the outcome of the proceedings pending in court. The case at hand stands on a much better footing. The appellant herein had been selected by the Tehsil Level Selection Committee in its meeting dated 19th April 2018 and thereafter, he was appointed as Fair Price Dealer vide order of the Competent Authority dated 15th May 2018, on a regular basis.”
Quite naturally, the Bench then observes in para 15 that, “In this background, we find that the appellant was a necessary party to the proceedings before the High Court. The present appeal deserves to be allowed on this short ground. However, there is another more serious ground on which the present appeal deserves to be allowed.”
Simply put, the Bench then states in para 16 that, “The Appellate Authority in its order dated 20th July 2018 has categorically observed thus:
“At present, new dealer Sh. Ram Kumar Singh s/o Chhote Singh has been approved as Fair Price Dealer, village Anta Tehsil Rasoolabad, Kanpur Dehat vide District Magistrate’s order dated 15.05.2018. In the end, prayer has been made that the appeal being devoid of merits, may be dismissed.””
Furthermore, the Bench then observes in para 17 that, “It has further been observed thus:
“As per the proposal made by Block Development Officer in the public interest, an open meeting was called on ………2018 for the selection of Fair Price Dealer at Gram Panchayat, Anta, in which the name of Sh. Ram Kumar Singh s/o Sh. Chhote Singh, resident of Gram Panchayat Anta, Tehsil Rasoolabad, Kanpur Dehat was taken into consideration and after discussion, in view of the decision taken by the Tehsil Level Selection Committee, dated 19th April 2018, as per the order of District Magistrate, Rasoolabad, Kanpur Dehat dated 15.05.2018, Sh. Ram Kumar Singh S/o Sh. Chhote Singh, resident of Gram Panchayat Anta, Tehsil Rasoolabad, Kanpur, Dehat has been appointed as new Kotedar in accordance with the orders issued by the Dy. Commissioner (Food) Kanpur Division and Hon’ble High Court, Allahabad.””
What is quite discernible is then encapsulated in para 18 wherein it is enunciated that, “It could thus be seen that respondent No. 9 was very well aware that during the pendency of the proceedings, the appellant was appointed as a Fair Price Dealer on 15th May 2018. The order of the Appellate Authority has been passed on 20th July 2018. Even this being the position, respondent No.9 has been bold enough to aver thus in the memo of the writ petition:
“33. That it is also noteworthy to mention here that during the pendency of the Fair Price Shop, no third party allotment was made and as per the direction of this Hon’ble Court, the shop of the petitioner was attached to another Fair Price Shop Holder.””
Quite ostensibly, the Bench then notes in para 19 that, “It could thus be seen that, though respondent No.9 was very well aware that during the pendency of the proceedings before the Appellate Authority, an allotment was done in favour of the present appellant, she has averred in her writ petition that no third party allotment was made. She has further gone on to state that, as per the directions of the High Court, the fair price shop of respondent No.9 was attached to another fair price shop holder. The statement is factually incorrect to the knowledge of respondent No.9. The same has been reiterated in the Ground thus:
“N. Because during the pendency of the Fair Price Shop, no third party allotment was made as per the direction of this Hon’ble Court, the shop of the petitioner was attached to another Fair Price Shop Holder.””
On expected lines, the Bench then minces no words to observe unequivocally in para 20 that, “It is thus clear that respondent No.9 has not only suppressed the fact about the subsequent allotment of the fair price shop to the appellant herein but has also tried to mislead the High Court that the fair price shop of respondent No.9 (the writ petitioner before the High Court) was attached to another fair price shop holder.”
Most significantly, to buttress what it viewed and analyzed, the Bench then minced just no words to hold in para 21 what forms the cornerstone of this notable judgment that, “This Court, in the case of S.P. Chengalvaraya Naidu (Dead) By LRs. Vs. Jagannath (Dead) by LRs and others (1994) 1 SCC 1 has held that non-disclosure of the relevant and material documents with a view to obtain an undue advantage would amount to fraud. It has been held that the judgment or decree obtained by fraud is to be treated as a nullity. We find that respondent No.9 has not only suppressed a material fact but has also tried to mislead the High Court. On this ground also, the present appeal deserves to be allowed.”
What’s more, the Bench then directs in para 22 that, “In the result, the appeal is allowed. The impugned order of the High Court dated 21st February 2019 is quashed and set aside. The order dated 18th November 2017 passed by the Deputy Collector, Rasoolabad cancelling the Fair Price Shop licence of respondent No. 9 and order dated 20th July 2018 passed by the Additional Commissioner (Judicial), Kanpur Division, Kanpur dismissing the appeal of respondent No.9 are affirmed.”
Finally, the Bench then concludes by holding in para 23 that, “Pending applications, if any, shall stand disposed of. No order as to costs.”
On the whole, the Apex Court minces no words to make it indubitably clear that judgment or decree obtained by fraud with a view to obtain undue advantage is to be treated as a nullity. It merits no reiteration that all courts must comply without reservation to what the Apex Court has laid down in this leading case so very cogently, composedly and convincingly! No denying it!
Sanjeev Sirohi
