'Fraud cloaks everything and avoids all judicial acts': SC

New Delhi, Mar 7 (UNI) "Fraud cloaks everything and avoids all judicial acts and a decree obtained by playing fraud is a nullity and can be challenged in any court, even in collateral proceedings," the Supreme Court has laid down.

The ruling was handed down by a bench comprising Mr. Justice H.K. Sema and Mr. Justice A.R. Lakshmanan vide their judgement dated March 6, 2006 while setting aside the high court order in a family dispute among the legal heirs of ex minister and retired judge of high court of Patiala Diwan Niranjan Parsad.

Justice Niranjan Parsad had two sons and three daughters and he had an ancestral kothi in Patiala and on Oct. 14,1956, the judge had gifted three plots to his daughters with the consent of his wife Amar Devi which were in the rear part of the kothi.

Since none of the daughters came to take possession of the plots gifted, Diwan Niranjan Parsad revoked the gift deed and paid Rs.

10000 to each of them in lieu of the plots. Justice Niranjan died on Jan. 15, 1975 and his daughter Saraswati died in 1966.

Dispute arose among the legal heirs of the judge after his death regarding the rear part of the compound of the Kothi called 'Nishkam'.

It appears that on Jan.22,1977 the respondents fraudulently managed to get the mutation of the portion of the property in question recorded in revenue records in their favour showing Diwan Niranjan Parsad who had died in 1975 and his daughter Saraswati who had died in 1966 as present and witnessing the said mutation.

The arbitrator also found that the mutation in favour of the respondents was obtained by fraudulent means and therefore, non-est.

When two sons of the judge namely K.J. Khosla and N. Khosla moved an application for making award of the arbitrator as absolute, the same was rejected on the grounds that since the award having value of more than Rs.100 as unregistered it could not be made a rule.

First appellate court and the high court also took the same stand and dismissed the appeals.

The respondent Raj Lakhshmi also died during the pendency of the case. The Supreme Court rejected the plea of the respondents that since appeal against Raj Lakhshmi abated it also automatically stood abated against other respondent also .

The apex court held,'' All the decisions of the court below are erroneous and are set aside and the award of the arbitrator is made rule of the court." The court also allowed appellants to file a suit against legal heirs of Raj Lakhshmi whose appeal has been abated. If the suit is filed within two months from today it shall not be dismissed as being barred by limitation.

UNI AKS/XC RP KN1735