Judgment or Decree obtained by Fraud is as a Nullity: SC

Ram Kumar Vs State of Uttar Pradesh (Supreme Court of India)

Conclusion: Non-disclosure of the relevant and material documents with a view to obtain an undue advantage would amount to fraud. Therefore, the judgment or decree obtained by fraud was to be treated as a nullity as the respondent had not only suppressed a material fact but had also tried to mislead the High Court.

Held: 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 with regard to malpractices committed by the said fair price shop dealer. As such, a site inspection of the fair price shop was done 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. At the conclusion of the inquiry, SDO found the charges to be proved and as such, vide order cancelled the Fair Price Shop licence of respondent No.9. Being aggrieved by the order passed by SDO, respondent carried an appeal to the Appellate Authority. It could thus be seen that respondent was very well aware that during the pendency of the proceedings, the appellant was appointed as a Fair Price Dealer. She had averred in her writ petition that no third party allotment was made. She had further gone on to state that, as per the directions of the High Court, the fair price shop of respondent was attached to another fair price shop holder. It was thus clear that respondent had not only suppressed the fact about the subsequent allotment of the fair price shop to the appellant herein but had also tried to mislead the High Court that the fair price shop of respondent was attached to another fair price shop holder. This Court, in the case of P. Chengalvaraya Naidu (Dead) By LRs. Vs. Jagannath (Dead) by LRs and others⁸ had held that non-disclosure of the relevant and material documents with a view to obtain an undue advantage would amount to fraud. It had been held that the judgment or decree obtained by fraud was to be treated as a nullity. Thus, the respondent had not only suppressed a material fact but had also tried to mislead the High Court. On this ground also, the present appeal deserved to be allowed.

FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER

1. This appeal challenges the judgment and order of the High Court of Judicature at Allahabad dated 21^st February 2019 thereby allowing the writ petition filed by respondent No. 9 herein, setting aside the order dated 18^th November 2017 passed by the Deputy Collector, Rasoolabad cancelling the fair price shop licence of respondent No. 9 and the order dated 20^th 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.

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