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Shamsheryar Khan and anr. Vs. Babu Gopal Chand and anr. - Court Judgment

LegalCrystal Citation
Decided On
Reported in7Ind.Cas.11
AppellantShamsheryar Khan and anr.
RespondentBabu Gopal Chand and anr.
civil procedure code (act v of 1908), sections 47, 158 - execution--fraudulent decree--separate suit or application--nullity--remedy against fraudulent decree--application for execution treated as suit--rules of procedure, alterations in--retrospective effect. - cantonments act[c.a. no. 41/2006]. section 346 & cantonment fund (servants rules, 1937, rules 13, 14 & 15: [h.l. gokhale, ag. cj, p.v. hardas, naresh h. patil, r.m. borde & r.m. savant, jj] jurisdiction of school tribunal constituted under maharashtra employees of private schools (conditions of service) regulations act, (3 of 1978) held, school run by the cantonment board is a primary school and it is not a school recognised by any such board comparable to the divisional board or the state board. the school tribunal constituted..........not be competent to get the hypothecated property sold by auction without paying the debt due to jwahir bibi, if a decree is passed in her favour by the appellate court. the plaintiff shall be competent to recover the amount of the decree from the principal judgment-debtors by gale of the property.3. on the 29th january 1897, the decree-holder applied for an order absolute; at the end of the application he stated that he would pay the prior mortgage of jwahir bibi should she obtain a decree from the appellate court.4. the court, on the 26th march 1897, ordered that as the prior charge of jwahir bibi had not been paid, 110 order absolute could be prepared.5. on the 16th may 1898, the decree-holder again applied for an order absolute and in paragraph 3 of the application he alleged: 'the.....

1. This is an execution second appeal by the judgment-debtors, Shamsheryar Khan and Ismdar Khan.

2. The facts are these:

One Ram Chander Das on the 27th May 1895 obtained a decree under Section 88 of the Transfer of Property Act. The material portion of it is as follows:It is ordered that the plaintiff's claim, for recovery of Rs. 4,945-1-0 by enforcement of the hypothecation lien against and sale of the property, be decreed and that a decree be prepared in conformity with the terms of the compromise stating therein that the plaintiff shall not be competent to get the hypothecated property sold by auction without paying the debt due to Jwahir Bibi, if a decree is passed in her favour by the appellate Court. The plaintiff shall be competent to recover the amount of the decree from the principal judgment-debtors by gale of the property.

3. On the 29th January 1897, the decree-holder applied for an order absolute; at the end of the application he stated that he would pay the prior mortgage of Jwahir Bibi should she obtain a decree from the appellate Court.

4. The Court, on the 26th March 1897, ordered that as the prior charge of Jwahir Bibi had not been paid, 110 order absolute could be prepared.

5. On the 16th May 1898, the decree-holder again applied for an order absolute and in paragraph 3 of the application he alleged: 'The suit of Jwahir Bibi was dismissed by the Court of first instance on the 15th September 1894 and its decision was upheld by the Court of appeal on the 27th April 1898; hence no prior charge of Jwahir Bibi is due and it is prayed that an order absolute in favour of the plaintiff against the defendant be passed.' The application was made against Shamsheryar Khan and Ismdar Khan only on the 25th of June 1898, the Court ordered as follows: 'The opposite party is not present even to-day, it is ordered that an order absolute be made.' In the order absolute, the duty cast upon the decree-holder to pay off the prior mortgage of Jwahir Bibi was left out and the decree-holder was authorised to have sold the property of the appellants for his mortgage money only. Although the application was not against Jwahir Bibi her name also appeared in the order absolute as a defendant. The objection of the appellants to the effect that without paying the prior mortgage of Jwahir Bibi the decree-holder could not sell their property was disallowed on the 27th August 1898. The order is to the effect: 'The pleader of the objector states that the appellate Court has dismissed Jwahir Bibi's appeal. As the debt claimed by Jwahir Bibi has not been found due to her by the appellate Court, the condition in the decree (of 1888) vanishes. The objection is, therefore, rejected with costs.'

6. Jwahir Bibi raised objections in execution proceedings which were rejected. She then brought a suit and the learned Subordinate Judge gave her a decree on the 25th September 1905. The operative portion of it is: 'It is ordered and decreed that the plaintiff's claim be decreed with the entire costs of the suit i.e., the decree absolute dated the 25th Jane 1898, which Babu Ramchander Das, ancestor of the defendants, obtained fraudulently and without making the plaintiff a party is void. The defendants, the subsequent mortgagors, are ordered first to pay the plaintiff and then to have the property mentioned in the decree sold by auction.'

7. On appeal to the learned District Judge, the decree of the Subordinate Judge was set aside but it was restored by the High Court on the 28th March 1907.

8. The learned Judges in their judgments say: 'The admitted facts of this case disclose gross fraud on the part of the father of the defendants-respondents.'

This fraud is set forth very fully in the judgment of learned Subordinate Judge. ... The Court of first instance appears to us to have rightly decided that an order absolute for sale obtained by Bam Chander Das could not be allowed to stand to the prejudice of the plaintiff-appellant, who admittedly holds the first mortgage on the property, the subject of the sale. The order absolute was obtained on a false and fraudulent representation that the plaintiff's mortgage had been satisfied. We, therefore, allow the appeal, set aside the decree of the Court of first instance.

9. The decree-holders, then, on the 1st December 1908, applied for the renewal of the execution proceedings. They said: 'The said case of Jwahir Bibi was on the 28th March 1907 decided with this order that the decree-holders should bring the property aforesaid to sale on payment of Rs. 4,391, the prior debt due to Jwahir Bibi. Accordingly a settlement having been made the prior lien was purchased for Rs. 3,000 under a deed of conveyance, dated the 1st November 1908 and the prior lien due to Jwahir Bibi has been paid off.'

10. Shamsheryar Khan and Ismdar Khan on the 22nd December 1908 objected that:

(a) The application was barred by time inasmuch as previous applications were not in accordance with law.

(b) The order absolute dated the 25th June 1908 was obtained by fraud and was not, therefore, capable of execution.

(c) The decree-holders had acquired no right by the purchase of Jwahir Bibi's rights.

(d) The application for execution dated the 9th July 1904 was illegal and the judgment-debtors were no parties to it.

(e) The decree holders realised nothing from the judgment-debtors after the order absolute. -

(f) The decree-holders were not entitled to bring the property to sale so long as the prior mortgage subsisted.

(g) The application for sale of the appellant's property is against the order of the first Court dated the 25th September 1908, which was upheld by the High Court on the 28th March 1907.

11. The Court of first instance disallowed the objections and its decree relating to the objections by the judgment-debtors was affirmed by the lower appellate Court.

12. The judgment-debtors come to this Court in second appeal. The following points are pressed by their learned counsel:

(a) The order absolute which was obtained by a gross fraud practised upon the Court is not capable of execution.

(b) The application is barred by time inasmuch as the previous applications which were not in accordance with law could not save limitation [See Bhagwan Sahai v. Bhagwan Din 12 A. 387 : 17 I.A. 98, Munawar Hussain v. Jani Bijai Shankar 27 A. 619; Janki v. Ram Pertab Singh 28 A. 286 : 2 A.L.J. 833 : A.W.N. (1906) 2 and Pandari Nath Bapuji v. Lalachand Hathibai 13 B. 237.]

(c) According to the terms of the decree under Section 88, the holder is bound to pay off the prior mortgage of Jwahir Bibi, to add it to his own mortgage and to bring the mortgage property to sale for the consolidated sum. [See Mata Din Kasodhan v. Kazim Hussain 13 A. 432.] The learned Advocate for the decree-holder contends that the executing Court cannot go behind the order absolute, that the objection as to fraud, which the appellants did not raise in previous applications, is barred by the principle of res judicata [See Bihari Lall v. Majid Ali A.W.N. (1896) 29, Sheuraj Singh v. Kamesharnath 24 A. 282, Qamuruddin Ahmed v. Jawahir Lall 27 A. 334 : 1 C.L.J. 381 : 15 M.L.J. 258 : 9 C.W.N. 601 : 2 A.L.J. 397 : 7 Bom. L.R. 433, Abadi Begam v. Muhammed Abdul Ghafur 3 A.L.J. 198 : A.W.N (1906) 70, Coventry v. Tulsi Pershad Narayan Singh 31 C. 288, and Murli Dhar v. Musammat Goma 7 A.L.J. 401 : 5 Ind. Cas. 210].

13. We take up the plea of fraud first. The judgment of this Court dated the 28th March 1908 leaves no room for doubt that the decree-holder was guilty of gross fraud in obtaining the order absolute. The law relating to decrees obtained by fraud is as follows:-- See Kerr on Fraud, 4th Edition, 325-26, Ed:--A judgment or decree obtained by fraud upon a Court binds not such Court or any other and its nullity upon this ground, though it has not been set aside or reversed, may be alleged in a collateral proceeding [Shedden v. Patrick 1 Macq. H.L. 535; Reg. v. Saddlers' Co., per Wallis J. 10 H.L.C. 404 at p. 431] 'Fraud' said DeGrey, C.J. 'is an extrinsic collateral act which initiates the most solemn proceedings of Courts of Justice. Lord Coke says it avoids all judicial acts ecclesiastical and temporal.' [Rex v. Duches of Kingston 20 How. St. Tr. 544 : 2 Smith L.C. 687].

14. In applying this rule it matters not whether the judgment impugned has been pronounced by an inferior or by the highest Court of Judicature in the realm, but in all cases alike it is competent for every Court whether superior or inferior to treat as nullity any judgment which can be clearly shown to have been obtained by manifest fraud. [Shedden v. Patrick 1 Macq. H.L. 535].

15. Whether an innocent party would be allow-ed to prove in one Court that a judgment against him in another Court was obtained by fraud, is a question not equally clear, as it would be in his power to apply directly to the Court which pronounced it to vacate it.

16. See also Burkatunnissa v. Fazl Haq 26 A. 272, and Nistarini Dasi v. Nundo Lal Bose 26 C. 891 : 3 C.W.N. 694, in which the effect of fraud upon a decree is discussed.

17. Considering the fact that the order absolute in consequence of the fraud practised upon the Court is a nullity, the appellants must have some remedy to vacate it and it remains to discuss the remedy to which they are entitled. A separate suit and not an application under Section 244, Civil Procedure Code, has been held to be the remedy of a victim of fraud. In Sudindra v. Budan 9 M. 81 at p. 83, it is observed 'that in execution the appellant cannot dispute the correctness of the decree. Under Section 244 the questions to be decided in execution are questions relating to the execution, discharge or satisfaction of the decree. A question whether the decree was obtained by fraud or collusion is not one which relates to the execution of the decree, but which affects its very subsistence and validity. Such a question can only be raised by a separate suit.'

18. The following cases also throw light on the subject. Abdul Mazumdar v. Muhammad Ghazi 21 C. 605, Ram Nath v. Mahesh Chandra 24 C. 546, Moti Lal Chakerbutty v. Chundra Banragi 26 C. 326 at pp. 328, 332 : 3 C.W.N. 395, Ram Narayan Tiwari v. Sheu Bhan jan Roy 27 C. 197, Bansi Lall v. Ramji Lal 20 A. 370, and Bowen v. Evans 2 H.L.C. 257 at p. 281 : 1 Jo. and Lat. 178 : 6 Ir. Eq. R. 569, quoted in Chelcmbar v. Krishnappa 26 B. 545 at p. 547.

19. The law, however, under the new Code of Civil Procedure is that an application in execution may be treated as a suit. Section 47(2) is as follows:

'The Court may, subject to any objection as to limitation or jurisdiction, treat a proceeding under this Section as a suit or a suit as a proceeding, and may, if necessary, order payment of the additional Court-fee.' A Court of Justice can have no sympathy with a person who obtains a decree by gross fraud practised upon Court and must do all it can to defeat the object of the fraud. We, therefore, are of opinion that the case before us is a fit and proper one for treating the appellants' application as a plaint subject to the condition set forth in Section 47(2).

20. The questions that the fraud does not affect the appellants, that they are debarred from raising that objection and any other questions that may arise are questions on which we pronounce no opinion. They will be dealt with by the Court which will try the case. It may, however, be argued that Section 47(2) of the Civil Procedure Code applies only to such applications as are put in under the new Code, and not to applications which were pending when the new Code came into force. There is no substance in this argument, ' No person has a vested right in any course of procedure [per Mellish, L.J. in Costa Rica v. Erlanger 3 Ch. D. 69 : 46 L.J. Ch. 375 : 36 L.T. 332, Maxwell p. 388 4th Edition] which prescribes the mode of enforcing rights. When an Act deals with procedure, it applies to all actions pending as well as future.' 'The general principle indeed seems to be that alterations in the procedure are always retrospective, unless there be some good reason against it' [See per Lord Blackburn in Gardiner v. Lucus 3 A.C. 603; Kimbrary v. Draper 3 Q.B. 160 : 9 B. and S. 80 : 37 L.J.Q.B. 80 : 17 L.T. 540 : 16 W.R. 539; Maxwell p. 339 4th Ed.]

21. Holloway, J. in Morris v. Sambamurthi 6 M.H.C.R. 122 at p. 126, observes as follows:

Rights already acquired shall not be affected by the retro-action of a new law. Rules as to procedure are an exception. The law as to the acquisition of rights is that prevailing at the period of the arising of the matters of fact which generate them. Their enforcement must be according, to the rules of process at the period of suit.

22. In re Bhagwan Dan Hnrjivan 8 B. 511 at p. 518, it is said:

It is clear that this question is simply one of procedure and the rule with, regard to the effect of legislation upon matters of procedure is well-known. The rule is clearly stated by Wildy, B. in Wright v. Hale 30 L.J. Ex. (N.S.) 40 : 6 H. and N. 227 : 6 Jur. (N.S.) 1212 : 3 L.T. 444 : 9 W.R. 157. He says:'Where you are dealing with a right of action, and an Act of Parliament passes, unless something express is contained in that Act, the right of action is not taken away but where you are dealing with mere procedure, unless something is said to the contrary and the language in its terms applies to all actions whether before or after the Act, there I think the principle is that the Act does apply without reference to the former law or procedure.' Further on in his judgment he says: 'What is the right the suitor has The right of action is the right to bring the action and what is the right to bring the action To have it conducted in the way and according to the practice of the Court in which he brings it, and if any Act of Parliament or any rule founded on the authority of an Act of Parliament alters the mode of procedure, then he has a right to have it conducted in that altered mode. That, therefore, takes away nothing. The right of action does not involve the right to keep all the consequences of that right as they were before. It gives him the right to have that action conducted according to the rules that are then in force with respect to procedure.'

23. Trevellian, J. in Bhobo Sundari Debt v. Rakhal Chandra Bose 12 C. 583 at p. 589 observes:

There is, I think, a clear distinction between relief and the mode or procedure for obtaining such relief. The relief remains unaffected by the change of the procedure.

24. In Hajrat Akramulnissa Begum v. Wahulnissa Begum 18 B. 429 at p. 432, it is observed: 'The case would be governed by the general principle that alterations in forms of procedure are retrospective in effect and apply to pending proceedings; Sha Jasraj Himraj v. Chandasama Wakaht Sarey 2 P.J. (1896) 294.' See also Ganga Ram v. Puran Chand 21 B. 822, Vidavithi Nasariah v. Mangamma 27 M. 538 and China Nasariha v. Mangamma 14 M.L.J. 340.

25. The principle set forth in the rulings already cited is embodied in Section 158 of the new Code of Civil Procedure (Act V of 1908), In this view of this case it is unnecessary to consider the authorities relied on by either side.

26. The result is that we set aside the orders of the Courts below and send down the case to the Court of first instance through the lower appellate Court with the direction that the application of objections, filed by the appellant on the 22nd December 1903, be treated as a plaint subject to the conditions set forth in Section 47(2), of the Code of Civil Procedure. We make no order as to the costs of this appeal.

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