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Chintamoni Moharana and ors. Vs. Krushnaparsad Singh and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty;Civil
CourtOrissa High Court
Decided On
Case NumberCivil Revn. No. 115 of 1958
Judge
Reported inAIR1960Ori75
ActsLimitation Act, 1908 - Sections 18; Evidence Act, 1872 - Sections 101 and 104; Tenancy Law; Orissa Tenancy Act, 1913 - Sections 228(2); Code of Civil Procedure (CPC) , 1908 - Sections 115
AppellantChintamoni Moharana and ors.
RespondentKrushnaparsad Singh and anr.
Appellant AdvocateS. Misra and ;D. Singh, Advs.
Respondent AdvocateK.M. Swain, Adv.
DispositionRevision allowed
Cases Referred and Bharat Dharma Syndicate Ltd. v. Harish Chandra
Excerpt:
.....or conducting a sale of a tenure or holding for alleged arrears of rent due thereon. the rent suit deputy collector dismissed the said application as 'prima facie time-barred' finding that the applicants had failed to prove fraud. --effect of fraud, where any person having a right to institute a suit or make an application has, by means of fraud been kept from the knowledge of such right or of the title on which it is founded, or where any document necessary to establish such right has been fraudulently concealed from him, the time limited for instituting a suit or making an application- (a) against the person guilty of fraud or accessory thereto, or (b) against any person claiming through him otherwise than in good faith and for a valuable consideration, shall be computed from..........dismissing the said appeal from an order made in execution case no. 1092 of 1953-54 by which the rent suit deputy collector dismissed the petitioners' said application under section 228(2) of the orissa tenancy act on his finding that the application was time-barred.2. the matter arose in these circumstances: by a registered kabala dated august 4, 1931, the petitioners purchased certain properties mentioned in the said kabala from one panu sahu. thereafter, by another registered kabala dated march 3j, 1934, the petitioners purchased certain other properties from one bimbadhar sahu. it is stated that the area of the land purchased is a.o. 37 decimals and the market price thereof is not less than rs. 500/-. the petitioners used to pay rent and had obtained rent receipts from the landlord.....
Judgment:
ORDER

S. Barman, J.

1. In this Civil revision the petitionersare certain judgment-debtors who were unsuccessful in both the Courts below in their application under Section 228(2) of the Orissa Tenancy Act (Bihar and Orissa Act II of 1913) for setting aside a sale on the ground of alleged material irregularity or fraud in publishing or conducting a sale of a tenure or holding for alleged arrears of rent due thereon. This revision is directed against the order made by the learned Additional District Magistrate, Cuttack in Execution Appeal No. 25 of 1956-57 dismissing the said appeal from an order made in Execution Case No. 1092 of 1953-54 by which the Rent Suit Deputy Collector dismissed the petitioners' said application under Section 228(2) of the Orissa Tenancy Act on his finding that the application was time-barred.

2. The matter arose in these circumstances: By a registered kabala dated August 4, 1931, the petitioners purchased certain properties mentioned in the said Kabala from One Panu Sahu. Thereafter, by another registered Kabala dated March 3J, 1934, the petitioners purchased certain other properties from one Bimbadhar Sahu. It is stated that the area of the land purchased is A.O. 37 decimals and the market price thereof is not less than Rs. 500/-. The petitioners used to pay rent and had obtained rent receipts from the landlord in respect of the rents that they were paying to him.

In 1951/1952 a rent suit against the vendors of the petitioners was filed by the landlord being opposite party No. 2 ignoring the purchases made by the petitioners under the said Kabalas. The suit was decreed against the vendors of the petitioners for alleged arrears of rent. Thereafter there was the said execution case being Execution Case No. 1092/ 1953-1954 purported to be in execution of the said decree against the said vendors defendants in the said rent suit for realisation of the arrears of rent for the years 1954-1955, 1955-1956, 1956-1957 and 1937-1958.

The present petitioners, however were not made parties in these execution proceedings and it is alleged that all these proceedings, in the rent suit as also the execution case, were all behind the back of the present petitioners. On August 14, 1954 the property in suit was sold in execution case for a petty sum of Rs. 23/- only and the opposite party no. 1 purchased the same property as auction purchaser. On November 20, 1954 the petitioners made an application for setting aside the sale under Section 228(2) of the Orissa Tenancy Act (Bihar and Orissa Act II of 1913) read with Section 18 of the Limitation Act.

On the facts of it the said application made on November 20, 1954 for setting aside the sale under Section 228(2) Orissa Tenancy Act was out of time by four days, -- the period of limitation beingthree months from the date of the sale, that is August 16, 1954 which expired on November 16, 1954. The petitioners sought to take protection under Section 18 of the Indian Limitation Act (IX of 1908) on the ground of alleged fraud. The Rent Suit Deputy Collector dismissed the said application as 'prima facie time-barred' finding that the applicants had failed to prove fraud. In appeal, the learned Additional District Magistrate as Collector under the Orissa Tenancy Act confirmed the decision of the Rent Suit Deputy Collector. Hence this revision.

3. It appears from the judgment of the Rent Suit Deputy Collector and the Additional District Magistrate that they both proceeded on the basis that there was no fraud under Section 18 of the Limitation Act and hence they took the view that the application was barred by limitation. Mr. D. Singh, learned Counsel for the petitioners, contended that the petitioners were only out of time by four days. His main contention was that it was by reason of suppression of fact and consequent fraud played on the petitioners that the petitioners did not know either of the rent suit or of the execution proceedings thereon.

In this context the learned Counsel referred to Exts. 3 and 4 being the rent receipts, stated to have been given to the petitioners on behalf of the landlord by his dismissed Tahasildar. Ext. 3 is a rent receipt dated March 3, 1952 and Ext. 4 is a rent receipt dated April 15, 1953. It is thus clear that rents were being paid by the petitioners to the landlord during 1952 and 1953. It gives rise to suspicion that the rent suit was filed by the landlord against the vendors of the petitioners ignoring the purchase by the petitioners from the said vendors by the said Registered Kabala dated August 4, 1931 and March 31, 1934.

In view of the order of remand in this revision, the Court does not express any opinion on merits. The allegation is that there was a fraud played in the petitioners keeping them in the dark as to what was taking place in the rent suit and in the execution proceedings. Section 18 of the Indian Limitation Act reads as follows:--

Effect of fraud,

'Where any person having a right to institute a suit or make an application has, by means of fraud been kept from the knowledge of such right or of the title on which it is founded, or where any document necessary to establish such right has been fraudulently concealed from him, the time limited for instituting a suit or making an application-

(a) against the person guilty of fraud or accessory thereto, or

(b) against any person claiming through him otherwise than in good faith and for a valuable consideration,

shall be computed from the time when the fraud first became known to the person injuriously affected thereby, or in the case of the concealed document, when be first had the means of producing it or compelling its production.'

Section 228(2) of the Orissa Tenancy Act under which the petitioners filed the application for setting aside the sale provides as follows:

'where a tenure or holding has been sold for arrears of rent due thereon, the decree-holder the judgment-debtor or any person whose interests are affected by the sale, may, at any time 'within three months from the date of the sale' apply to the Court to set aside the sale on the ground of a 'material irregularity or fraud in publishing or conducting the sale.

Provided as follows :

(a) no sale shall be set aside on any such ground unless the court is satisfied that the applicant has sustained 'substantial injury' by reason of such irregularity or fraud ........'

(For convenience of ready attention I have underlined (here in ' ') the relevant portions of the two sections quoted above.)

The language of Section 228(2) is almost similar to that of Order 21, Rule 90, Civil Procedure Code permitting application to set aside sale also on the ground of material irregularity or fraud. Mr. D. Singh relied on a decision of this Court reported in babaji Krishna Chandra v. Dasarathi Das, (C.R. No. 251 of 1949): 16 Cut. L. T. (Notes) 65 at p. 26: (A.I.R. 1951 Orissa 149) where to save limitation the appellant sought protection under Section 18 of the Limitation Act on the ground of alleged fraud, in his application for setting aside the sale under order 21 Rule 90, Civil Procedure Code.

It was held that the fraud envisaged in Section 18 of the Limitation Act, contemplates some definite act committed by the decree-holder. But it may well be that the concealment of facts which would otherwise amount to notice or bring the sale to the knowledge of the judgment debtor would equally be an act of fraud. Where a person gets property by committing fraud of this sort, it is for him to show that the person injured by his act and seeking to recover tbe property, has had clear and definite knowledge of those facts which constitute fraud at a time which is too remote to allow him to make the application.

A person, who in such circumstances desires to invoke the aid of Section 18 of the Limitation Act must establish that there has been fraud and that by means of such fraud he has been kept from his knowledge of his right to sue or of the title whereon it is founded. Once this is established, the burden is shifted on the other side to show that the plaintiff had knowledge of the transaction beyond the period of limitation. The other circumstance, on which the learned counsel for the judgment debtors petitioners in the present case strongly relied, was the circumstance that the properties were sold for a very low price of Rs. 23A.

The learned Counsel relied on a decision of this High Court in Sitaram Das v. Lokenath Das, 21 Cut. L. T. 406 at p. 409 where it was held that the very fact that half an acre of land had been sold for the petty sum of Rs. 23/- is itself indication of fraud and the sale was directed to be set aside,

4. It appears from the judgments of the Rent Suit Deputy Collector and the Additional District Magistrate that they both only gave a finding on fraud under Section 18 of the Limitation Act. They did not however deal at all with the question whether there was any alleged material irregularity or fraud in publishing or conducting the sale so as to get relief under Section 228 (2) of the Orissa Tenancy Act. Both the courts below overlooked tbe aspect that the meaning of fraud in Section 18 of the Indian Limitation Act has some other context different from the meaning; and import of the word 'fraud' in Section 228 (2) of the Orissa Tenancy Act.

The fraud contemplated by Section 18 of the Limitation Act is an actual and active fraud and not what is called constructive fraud. The words 'has . ....been kept' in Section 18 point to the conclusion that in order to constitute a fraud, it is not enough that there should be merely a tortuous act unknown to the injured party but that there must be some abuse of a confidential position, some intentional imposition, or some deliberate concealment of facts; there must be something actually said or done which is directly intended to prevent discovery.

It is incumbent on a plaintiff seeking the benefit of Section 18 to distinctly allege the particular fraud, by which he has been kept from the knowledge of his right of suit against the defendant, specifically and with detailed particulars, (Gulab Rai v. Tulsi Bam, AIR 1927 All 437 and Bharat Dharma Syndicate Ltd. v. Harish Chandra, AIR 1937 P. C. 146). Under Section 228 (2) of the Orissa Tenancy Act, fraud, by reason of which the appellant is alleged to have sustained substantial injury has been used in a context different from that under Section 18 of the Limitation Act.

The words 'on the ground of material irregularity or fraud' in Section 228 (2) clearly indicate that the nature of fraud which has to be proved is essentially different. The initial point to be considered under Section 18 is not whether fraud was committed in publishing or conducting the sale but whether fraud was committed on the applicant to set aside the sale. The enquiry as to nature of fraud under Section 18 of the Limitation Act and the enquiry as to 'material irregularity or fraud' under Section 228 (2) of the Orissa Tenancy Act must thus necessarily be different.

5. That apart, there is another aspect which both the courts below overlooked. It was this. The question of material irregularity or fraud under Section 228 (2) of the Orissa Tenancy Act relates to the merits of the application for setting aside the sale. The ground on which a sale may be set aside is either material irregularity or fraud in publishing or conducting the sale by reason of which the applicant sustained substantial injury. The determination of the such alleged material irregularity or fraud decides the merits of the application for setting aside the sale. While on the other land, the question of fraud under Section 18 of the Limitation Act does not at all relate to the merits of the application itself. The fraud under Section 18, if proved, only saves limitation and nothing more. Therefore, if there is no proof of fraud by means of which the applicant has been 'kept from the knowledge' of his right to make the application for setting aside the sale or of the title on which such right to apply is founded, it will decide that the applicant will not be entitled to the benefit of the section and the application is to be held as time-barred. If, however, there is evidence of fraud, then the application is to be treated as having been made within time. If thus, by proving fraud, the judgment debtor establishes his right to file a time-barred application, it will then be for him further to prove material irregularity or fraud in publishing or conducting the sale as required by Section 228 (2) of the Orissa Tenancy Act, sufficient to enable him to have the sale set aside under that section.

6. It appears from the judgments of the Courts below that they both came to the finding that the judgment-debtor-petitioner failed to prove fraud for the purpose of saving the limitation without discussing the evidence--oral or documentary. The Courts below should also have given a finding whether there was material irregularity or fraud in publishing or conducting the sale under Section 228 (2) of the Orissa Tenancy Act Piecemeal adjudication of issues in a perfunctory manner has been repeatedly deprecated by tbe Privy Council and the Supreme Court, and any finding based on such adjudication is clearly vulnerable and cannot be sustained in law. The Courts below appear to have acted in the exercise of their jurisdiction illegally or with material irregularity. This calls for interference by this court in its revisional jurisdiction under Section 115 Civil Procedure Code. I, therefore, allow this revision, set aside the orders of the courts below and remand the case to the Rent Suit Deputy Collector to give, on reconsideration, specific finding as to fraud underSection 18 of the Limitation Act on the question of limitation; and also specific finding on merits as to the alleged material irregularity or fraud in publishing or conducting the sale and whether by reason of such irregularity or fraud, if any, the petitioners sustained substantial injury as required by Section 228 (2) of the Orissa Tenancy Act and give his decision according to law. I must make it clear that the Kent Suit Deputy Collector is not bound by any of my observations on facts in this judgment and that he is free to decide the case according to law. The parties will be at liberty to adduce fresh evidencebefore the Rent Court Deputy Collector as they maybe advised. As to costs of this application will abidethe result of the case.


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