Supreme Court: Any sale by auction or other public procurement methods once confirmed ought not to be set-aside except on grounds of collusive, fraudulent or vitiated by inadequate pricing or underbidding

  Any sale by auction or other public procurement methods once already confirmed or concluded ought not to be set-aside or interfered with lightly except on grounds that go to the core of such sale process, such as either being collusive, fraudulent or vitiated by inadequate pricing or underbidding. Mere irregularity or deviation from a Rule which does not have any fundamental procedural error does not take away the foundation of authority for such proceeding. In such cases, courts in particular should be mindful to refrain entertaining any ground for challenging an auction which either could have been taken earlier before the sale was conducted and confirmed or where no substantial injury has been caused on account of such irregularity. {Para 218}

IN THE SUPREME COURT OF INDIA

Contempt Petition (C) Nos. 158-159 of 2024.

Decided On: 13.12.2024

Celir LLP Vs. Sumati Prasad Bafna and Ors.

Hon'ble Judges/Coram:

J.B. Pardiwala and Manoj Misra, JJ.

Author: J.B. Pardiwala, J.

Citation: 2024 INSC 978,MANU/SC/1343/2024.

Read full Judgment here: Click here.

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Whether the court should hold an enquiry about the fraudulent transfer as per 53 of TP Act in execution of decree?

 In Alamelu Ammal Vs. Chinnaswamy Reddiar MANU/TN/0296/1988, it was held that in view of amendment of Order XXI Rule 58, the attaching creditor need not file a separate suit under Section 53 of the Transfer of Property Act to put forth his case that the transfer was in fraud of creditors and the decree holder is entitled to plead so by way of a defence in the claim proceedings.

10. The view of the Division Bench of the High Court of Bombay is found to be the same in SBI Home Finance Ltd. Vs. Credential Finance Ltd. MANU/MH/0148/2001 : AIR 2001 Bom 179. To the same effect are the judgments of the Division Bench of Kerala in Rajan alias Rajan Gopinathan Vs. Dr. D. Jayashree Nayar MANU/KE/0677/2009 and of the High Court of Karnataka in S.K. Gangadhara Vs. Ramachandra MANU/KA/2000/2015 and the High Court of Andhra Pradesh in Ayitam Venkata Anjani Vs. Ganeshula Uma Parvathi MANU/AP/0579/2015.

11. I respectfully concur and do not find any reason to interpret the fourth paragraph of Section 53(1) of the Transfer of Property Act pedantically, by holding that the creditor and which term includes a decree holder, instead of having the questions under Section 53 adjudicated in execution, be relegated to a separate suit.

IN THE HIGH COURT OF DELHI

EX. P. 43/2019 and EX. P. 44/2019

Decided On: 15.01.2020

Rajeev Kumar Batra  Vs. Kewal Krishan Kumar

Hon'ble Judges/Coram:

Rajiv Sahai Endlaw, J.

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Whether a person can be held bound by recitals of deed even if he has signed said deed without reading it?

Their Lordships wish to add that in a case where the person executing the deed is neither blind nor illiterate, where no fraudulent misrepresentation is made to him, where he has ample opportunity of reading the deed and such knowledge of its purport that the plea of non est factum is not open to him, it is quite immaterial whether he reads the deed or not. He is bound by the deed because it operates as a conclusive bar against him-not because he has read it or understands it, but because he has chosen to execute it. 

BEFORE THE PRIVY COUNCIL

Privy Council Appeal No. 16 of 1937

Decided On: 13.01.1938

Martin Cashin and others  Vs. Peter J. Cashin

Hon'ble Judges/Coram:

Lords Atkin, Thankerton, Bussell of Killowen, Wright and Maugham

Citation:AIR 1938 Privy Council 103

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When insurance company has failed to prove that policy holder has fraudulently suppressed material facts?

 The opposite party-Corporation has taken a plea that the
answer given by the deceased policy-holder was not correct and he has
fraudulently suppressed the material facts because while he was treated
as an indoor patient before his death, there was an endorsement of the
doctor to the effect that he was suffering from “Seizure Disorder” since
1995 and stopped medication since 2001. It is not brought out by the
learned counsel for the Corporation as to who has made such statement
to the doctor of the Corporation and the said endorsement does not
disclose that for such disease, he was ever hospitalized. Moreover, such
endorsement does not disclose that he has undergone any test for such
disease. It may not be out of place to mention here that the Corporation
has not examined any doctor to prove such endorsement. It may not be
also out of place to mention here that the deceased policy-holder died
on 26.9.2004 after remaining for five days as an indoor patient. The
deceased policy-holder took the policies in the year 2002 and 2004.
Even if assuming that his medication continued up to 2001, obviously on
the date of policy undertaken, he was not suffering from any serious
illness and Annexure-7, which is the opinion of the treating doctor of
SCB Medical College and Hospital, Cuttack shows that the deceased
policy-holder died due to “Septicaemia” as primary cause and “Drug
Rash” is a secondary cause. The doctor has not been examined to prove
the basic source of information about “Seizure Disorder” the deceased
policy-holder was suffering from 1995 till 2001 and thereafter on the
date of taking the policies also, the policy-holder was suffering from
such disease.
HIGH COURT OF ORISSA,CUTTACK
W.P. (C) No.5265 of 2009

Mrs. Mamata Satpathy 
Versus
The Zonal Manager,
LIC of India and others 
PRESENT :
THE HON’BLE DR. JUSTICE D.P.CHOUDHURY
Date of judgment:16.01.2017
Citation: AIR 2017 Orissa 54

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When junior members of family are bound by decision made by karta relating to family business and property?

 The status of the head of the family acting as a Karta

under the traditional Hindu law deserves to be kept in mind in
such a situation. The junior members of the family are bound by
decisions of a Karta in matters of family business and property
unless it can be pleaded and proved that the head of the family has
acted fraudulently or for immoral purposes. 
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 3687 OF 2006
Rajni Sanghi 
V
Western Indian State Motors Ltd. & Ors
Citation:December 01, 2015.
Citation:(2015) 16 SCC631
SHIVA KIRTI SINGH, J.

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When decree obtained by party by concealment or non-disclosure will not be treated as fraudulent?

 We agree that when there is an allegation of fraud by non-disclosure of
necessary and relevant facts or concealment of material facts, it must be inquired
into. It is only after evidence is led coupled with intent to deceive that a conclusion
of fraud could be arrived at. A mere concealment or non-disclosure without intent
to deceive or a bald allegation of fraud without proof and intent to deceive would
not render a decree obtained by a party as fraudulent. To conclude in a blanket
manner that in every case where relevant facts are not disclosed, the decree
obtained would be fraudulent, is stretching the principle to a vanishing point.
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.11491 OF 201

HARJAS RAI MAKHIJA VS. PUSHPARANI JAIN & ANR

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Whether fraudulent character of decree can be assailed in execution proceeding?

This Court has in 2001 (3) AMR 720 : (2001 AIHC 3500) taken the view that fraudulent character of decree can be assailed even in execution by persons like present respondents, paragraph 6 of this ruling reads as under.

"6. On plain reading of the aforesaid provisions, as amended after 1976, it is not open to contend that the question relating to decree obtained by fraud cannot be gone into by the executing Court at the instance of the third party who is neither judgment debtor nor claiming through the judgment-debtor. Rule 101, as it presently stands clearly bars a separate suit and instead postulates that all questions arising between the parties shall be determined by the Court dealing with the application filed under Rule 97 or Rule 99. There is no dispute that the present proceedings are arising out of the obstructionist notice taken out by the petitioner under Rule 97 to remove obstruction. Therefore, in such proceedings the issue regarding the decree having been obtained by fraud can surely be adjudicated by the executing Court at the instance of a stranger to the decree. Reliance placed on the decision of this Court in Bank of India's case (supra) would be of no avail in as much as the observations made therein are in context of the issue that was considered by that Court. Moreover the decision of the Apex Court in Hiralal Patni's Case (supra) deals with the pre-amendment situation, which his inapplicable to our case. On the other hand, the respondents have rightly relied on the decision of the Apex Court inBrahmdeo Chaudhary v. Rishikesh Prasad Jaiswal. In the said decision the Apex Court has held that it cannot be said that the only remedy available to the stranger to the decree for possession who has resisted its execution, to have his claim agitated is the one Under Rule 99 of order XXI after he has lost possession to the decree-holder and that he has no locus standi to get adjudication of his claim prior to the actual delivery of possession to the decree-holder in the execution proceedings. The Apex Court after considering the scheme of order XXI has observed that the provisions of Order XXI lay down a complete Code for resolving all disputes pertaining to execution of decree for possession obtained by a decree-holder and whose attempts at executing the said decree meet with rough weather. In para 5 of this decision the apex Court has observed that the amended provision of Order 21 clearly guards against the pitfall and provides a statutory remedy both in the decree-holder as well as to the obstructionist to have their respective say in the matter and to get proper adjudication before the Executing Court and it is that adjudication which is subject to the hierarchy of appeals would remain binding between the parties in such proceedings and separate suit would be barred with a view to seeing that multiplicity of proceedings and parallel proceedings are avoided and the gamut laid down by Order 21, Rules 97 to 103 would remain a complete Code and the sole remedy for the concerned parties to have their grievances once and for all finally resolved in execution proceedings themselves. In view of the aforesaid settled legal position it is too late in the day for the Petitioner to contend to the contrary."

10. From this judgment also it is clear that respondents could resist the execution on implementation of decree on lines of succession certificate obtained by petitioner from Chandrapur Court before Wardha Court. In fact some amounts have been withdrawn from bank account in Wardha jurisdiction.

Bombay High Court

Manda R. Pande vs Smt. Jankibai S. Dubey on 8 September, 2005

Equivalent citations: AIR 2005 Bom 397, 2006 (2) MhLj 162

Bench: B Dharmadhikari

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How to prove essential ingredients of offence of forgery?

The condition precedent for an offence under sections 467, 468 and 471 is forgery. The condition precedent for forgery is making a false document (or false electronic record or part thereof). This case does not relate to any false electronic record. Therefore, the question is whether the accused (petitioners), in executing and registering the general power of attorney purporting to sell a property, can be said to have made and executed false document. 

An analysis of section 464 IPC shows that it divides false documents into three categories: 

The first is where a person dishonestly or fraudulently makes or executes a document with the intention of causing it to be believed that such document was made or executed by some other person, or by the authority of some other person, by whom or by whose authority he knows it was not made or executed. 

The second is where a person dishonestly or fraudulently, by cancellation or otherwise, alters a document in any material part, without lawful authority, after it has been made or executed by either himself or any other person. 

The third is where a person dishonestly or fraudulently causes any person to sign, execute or alter a document knowing that such person could not by reason of (a) unsoundness of mind; or (b) intoxication; or (c) deception practiced upon him, know the contents of the document or the nature of the alteration. 

In short, WHEN , if (i) he made or executed a document claiming to be someone else or authorized by someone else; or (ii) he altered or tampered a document; or (iii) he obtained a document by practicing deception, or from a person not in control of his senses. 

In Mohd. Ibrahim and others vs. State of Bihar (2009) 8 SCC 751 upon examining Section 463, 467 to 471 IPC as noted, herein above, the Court while dealing with sale-deeds executed by the accused held:

"There is a fundamental difference between a person executing a sale deed claiming that the property conveyed is his property, and a person executing a sale deed by impersonating the owner or falsely claiming to be authorized or empowered by the owner, to execute the deed on owner's behalf. When a person executes a document conveying a property describing it as his, there are two possibilities. The first is that he bonafide believes that the property actually belongs to him. The second is that he may be dishonestly or fraudulently claiming it to be his even though he knows that it is not his property. But to fall under first category of `false documents', it is not sufficient that a document has been made or executed dishonestly or fraudulently. There is a further requirement that it should have been made with the intention of causing it to be believed that such document was made or executed by, or by the authority of a person, by whom or by whose authority he knows that it was not made or executed. When a document is executed by a person claiming a property which is not his, he is not claiming that he is someone else nor is he claiming that he is authorized by someone else. Therefore, execution of such document (purporting to convey some property of which he is not the owner) is not execution of a false document as defined under section 464 of the Code. If what is executed is not a false document, there is no forgery. If there is no forgery, then neither section 467 nor section 471 of the Code are attracted. 

ALLAHABAD HIGH COURT

Case :- CRIMINAL MISC. WRIT PETITION No. - 17783 of 2010

Rajesh Gandhi And Others Vs State Of U.P. And Another

Hon'ble Suneet Kumar,J. 

Order Date :- 30.5.2016 

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Issue of false certificate -when offence U/S 420 of IPC is not made out?

Criminal - Conviction - Challenge thereto - Sections 177 and 420 of Indian Penal Code, 1860 - Present appeal filed against order whereby Appellant was convicted for offences of cheating and furnishing false information - Whether conviction and sentence of Appellant under Sections 420 and 177 of Code was sustainable - Held, Appellant being Sarpanch of Gram Panchayat issued false certificate in favour of Co-Accused that he did not own any land except land which he made fit for cultivation - Appellant furnished information which he knew to be false - Therefore, ingredients of Section 177 of Code were proved - However, there was no evidence to show that there was such fraudulent dishonest intention on part of Appellant in issuing certificate - Issuance of false certificate could not be said to be with dishonest intention to make wrongful gain for himself - Therefore, conviction of Appellant under Section 420 of Code could not be sustained and same was set aside - Appeal disposed of. 


SUPREME COURT OF INDIA
(T.S. THAKUR AND R. BANUMATHI, JJ.)
BISHAN DAS

VERSUS
STATE OF PUNJAB AND ANR.
Respondents
Criminal Appeal No. 1837 of 2014 (Arising out of S.L.P. (Crl.) No. 2331/2014)-Decided on 26-8-2014.
Citation;2015CriLJ281, 2014(4)Crimes181(SC),2015 ALLSCR861

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Fraudulent Divorce petition through imposter can not be permitted

 Having given our anxious consideration to the rival contentions advanced we find that so far as the record of the case which was minutely examined by the High Court goes, no other conclusion was possible save and except the one that in hot haste by collusion between the parties, a decree for divorce was almost snatched from the Court. It certainly amounted to perpetration of fraud on the Court. This conclusion to which the learned Single Judge of the High Court reached on perusing the record of the case was based on the following well-established and indisputable facts and circumstances revealed from the record:

(i) The unauthentic photograph of the petitioner (present respondent) of her young age was affixed on the first page of the divorce petition though it was not required under any rule of law.

(ii) The register of the Oath Commissioner did not bear the signatures of respondent Smt. Garima Singh on the dates when the affidavit was alleged to have been sworn by her at Sitapur.

(iii) There was non-compliance of Order V CPC regarding issuance of process, service etc. There was no service report of service of summons on the respondent (present appellant) and as to how and when the service was effected.

(iv) No notice inviting objections to the decree or pro forma-proposed decree were invited on 3-4-1995 as required under the rules and one week's time which was mandatory for being granted for filing objections was not granted and the decree was drawn on 5-4-1995.

(v) Written statement was not filed on the date fixed, i.e., 15-3-1995, though the written statement was ready and sworn on 14-3-1995. Interestingly as per the record the process was filed on 14-3-1995 and the written statement was also sworn on the same day at Sitapur. The record does not reveal as to when and how it was filed.

(vi) The petitioner (present respondent) was not called upon to appear herself to depose to prove the averments made in the plaint even though she was said to be at Sitapur that day and the evidence on affidavit was accepted.

(vii) The provisions of Section 23(2) of the Hindu Marriage Act and Order 32-A of the Rules and XXXV of the CPC were given a complete go-by and no attempt whatsoever was made by the Presiding Officer to bring reconciliation between the parties which is the mandate of this special law.

(viii) The petition under Section 13 of the Hindu Marriage Act and the written statement filed by the respondent (present appellant) appear to be in the same language and to have been typed on the same typewriter.

On the basis of the aforesaid salient features clearly discernible from the record the learned Single Judge came to the conclusion that a fraud was practised by the parties to the litigation on the Court. It was observed by the learned Single Judge in this connection that the learned trial Judge failed to notice that the decree of divorce granted in Suit No. 78 of 1995 was wholly collusive. Divorces are not granted for the asking, but the parties are put to trial to prove that the ingredients for grant of the divorce as provided in the Hindu Marriage Act do exist. In this connection it was also observed that if the parties come to a mutual agreement to get divorced as they cannot live together any more, then they have to apply for consent decree of divorce under Section 13B of the Hindu Marriage Act after fulfilling the prerequisites for the same, otherwise it is the duty of the Court to ensure that collusive decree of divorce is not granted. Under these circumstances it was observed that in this case even if it is assumed that the real Garima Singh filed the suit in question, the petition was clearly collusive and the decree had been granted without application of mind. Consequently, on this finding alone the application under Section 151 CPC was required to be allowed and is rightly allowed by the learned Single Judge of the High Court. Hence the ex parte decree also must be held to be rightly set aside.

Supreme Court of India

Sanjay Singh vs Garima Singh on 3 March, 1998

Equivalent citations: (1998) 8 SCC 375

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