Bhaurao
Dagdu Paralkar Vs. State of Maharashtra & Ors [2005] Insc 425 (22 August 2005)
Arijit
Pasayat & B.N. Srikrishna
(Arising
out of SLP) Nos. 11344-11349/2004) ARIJIT PASAYAT, J.
Leave
granted.
When
one talks of freedom fighters' the normal image that comes to one's mind is a
person who had suffered physically and mentally for unshackling chains of
foreign rule in our country. The normal reaction when one sees such person is
one of reverence, regard and respect. The brave courageous deeds of these persons
is a distinctive part of India's fight for freedom. Many persons
lost their lives, many were injured and large number of such persons had
languished in jails for various periods. The common thread which must have
passed through the minds of these people is their sole objective to see that
their motherland has a government of its own, free from foreign rule. But these
images get shattered when one hears that with a view to gain financially, vague
documents have been produced, false claims of participation in the freedom
movement have been made. It is a sad reflection on the moral values of the
citizens of our country that a large number of cases have surfaced where it has
been established that people who were not even born when the freedom fight was on
or the country got independence or were toddlers when the country got
independence have applied for and managed to get "Sammanpatra", pensionary
and other allied benefits. The appeals at hand deal with such allegations. This
is "Asanman" (disrespect) to the whole country and such dishonourable
ventures have to be dealt with sternness to send out a message that they are
not freedom fighters, but are traitors sullying the name of freedom fight.
In
these appeals challenge is to the judgment delivered by a Division Bench of the
Bombay High Court at Aurangabad Bench by which several writ petitions were
disposed of.
Writ
petitions came to be filed before the High Court challenging the grant of
benefits to such phantoms masquerading to be freedom fighters. The basic
allegation in the writ petitions was that in the Beed District of Maharashtra,
there were large number of persons who had been granted pensionary benefits
under the Freedom Fighters' Pension Scheme (in short the 'Scheme'). Such writ
petitions were purported to have been filed by persons in public interest. In
one case the petition was filed by a freedom fighter who claimed that he was
surprised to see the number of persons falsely claiming to be freedom fighters.
The prayer essentially was to hold detailed enquiry and to cancel the pensionary
benefits and for a direction to recover the amounts which had already been paid
along with the prayer for initiation of criminal proceedings against the bogus
claimants. It was pointed out that in as many as 354 bogus claims have been
allowed in the concerned district. Such persons were availing pensionary and
other benefits which are to be availed only by genuine freedom fighters. It was
highlighted in the petitions that some of the so called freedom fighters were all
of tender age and/or were not born when freedom struggle was fought. In respect
of others it was alleged that they managed to get freedom fighters' pension by
submitting forged, false and fabricated documents. A Division Bench of the High
Court taking cognizance of the petitions and the serious allegations made
therein constituted a three-member Enquiry Committee headed by a retired Judge
of the Maharashtra Administrative Tribunal and two other members who were practising
advocates from the Beed District. They were required to enquire into the claims
of so called freedom fighters. The Committee was constituted by order dated
3.12.2002. Allegations were made that out of 3000 applications filed, 354 were
ineligible and the High Power Committee of the State had wrongly recommended
payment of pension holding them to be freedom fighters. It is stated that there
are two Committees i.e.
District
Level Committee (District Gaurav Committee) and State Level High Power
Committee which are required to examine the claims. The High Court after
perusing the 3000 applications retained the files of these suspected 354 cases.
Order passed prior to the appointment of the Enquiry Committee revealed that
the Court prima facie was of the view that in 26 cases the persons were less
than 10 years of age when the freedom struggle was fought. The Enquiry
Committee submitted its report. After the enquiry report was submitted, the
High Court passed orders at various stages.
It
appears that some of the persons whose names were included in the list of 354
suspected beneficiaries filed the writ petitions. While the High Court directed
the Collector, Beed District not to release pension to these freedom fighters
whose cases were covered by the Enquiry Committee until further orders. The said
order of the High Court was also made applicable to the freedom fighters whose
civil writ applications were already rejected. Aggrieved by the order, Special
Leave Petition was filed before this Court which was disposed of by the
following order:
"Heard
the learned counsel for the petitioners.
We
decline to grant permission to file the Special Leave petitions but give
liberty to the petitioners to file independent writ petitions, challenging the
order of the Enquiry Committee, if so desired.
At
this stage, the learned counsel for the petitioners states that certain
observations made in the impugned order will come in their way and/or affect
the case of the petitioners on merits. We make it clear that the observations
made in the impugned order shall not affect the merits of the case of the
petitioners in the writ petitions that may be filed." After hearing the
cases, the High Court by the impugned judgment held that the foundation on
which the allegations were made was really factually incorrect. The High Court
took five sample cases and came to hold that the report of the Enquiry
Committee was not to be accepted and accordingly dismissed the writ petitions.
It was of the view that the documents produced were sufficient to substantiate
the claims. It found that the parameters fixed by this Court for dealing with
the applications for freedom fighters' pension were fulfilled and therefore no
interference was called for. It also held that the petitions filed as 'Public
Interest Litigation' were not really so. It was observed that the enquiries
conducted before grant of pension cannot be upset by contrary findings recorded
by the Enquiry Committee and, therefore, the petitions challenging grant of
freedom fighters' pension were dismissed while the petitions questioning
correctness of the Enquiry Committee appointed by the High Court were allowed.
In
support of the appeals, Mr. A.V. Savant, learned senior counsel submitted that
the approach of the High Court is clearly erroneous. The fact that it took up 5
sample cases itself shows that the High Court was not adopting the proper
course. Even if it is accepted for the sake of argument that the persons
covered by the five sample cases were genuine freedom fighters that does not
necessarily lead to an inference that all others were also genuine freedom
fighters. After elaborate analysis of the materials the Committee came to hold
that the claims were bogus and tainted with fraud. The High Court should not
have lightly interfered with the findings on suppositions and presumptions.
Per
contra, learned counsel for the beneficiaries whose eligibility was questioned
submitted that all relevant documents had been submitted, were scrutinized and
thereafter pension was granted and, therefore, the Committee appointed by the
High Court was not justified in lightly brushing aside the intrinsic value of
the documents produced to hold otherwise.
The
object of the scheme was highlighted by this Court in Mukundlal Bhandari v.
Union of India and Ors. (AIR 1993 SC 2127) "The object was to honour and
where it was necessary also to mitigate the sufferings of those who had given
their all for the country in the hour of its need. In fact, many of those who
do not have sufficient income to maintain themselves refuse to take benefit of
it since they consider it as an affront to the sense of patriotism with which
they plunged in the freedom struggle. The spirit of the scheme being both to
assist and honour the needy and acknowledge the valuable sacrifices made, it
would be contrary to its spirit to convert it into some kind of a programme of
compensation. Yet that may be the result if the benefit is directed to be given
retrospectively whatever the date the application is made. The Scheme should
retain its high objective with which it was motivated..." Again in Gurdial
Singh v. Union of India (2001 AIR SCW 3843) this Court observed:
"It
should not be forgotten that the persons intended to be covered by the scheme
have suffered for the country about half a century back and had not expected to
be rewarded for the imprisonment suffered by them. Once the country has decided
to honour such freedom fighters, the bureaucrats entrusted with the job of
examining the cases of such freedom fighters are expected to keep in mind the
purpose and object of the scheme...." We are in respectful agreement with
the view expressed in Mukundlal's and Gurdial Singh's cases (supra). As noted
at the threshold, the genuine freedom fighters deserve to be treated with
reverence, respect and honour. But at the same time it cannot be lost sight of
that people who had no role to play in the freedom struggle should not be
permitted to benefit from the liberal approach required to be adopted in the
case of the freedom fighters, most of whom in the normal course are septuagenarians
and octogenarians. It baffles one, beyond comprehension, when claim is made by
a person who was not even born during the freedom struggle to be a freedom
fighter. Learned counsel for the appellant has submitted a list which makes an
interesting reading. Some of the beneficiaries were born in 1951 and some in
1955. Accepting claims of such persons to be freedom fighters would be making a
mockery of the scheme which is intended for genuine freedom fighter. The
approach of the High Court is clearly untenable. Sampling cannot be the method
for determining the truth or otherwise of the allegations or claims made. Each
case was required to be individually examined. On that score alone, the High
Court's judgment is vulnerable. Allegations made were to the effect that fraud
has been practiced.
By
"fraud" is meant an intention to deceive; whether it is from any
expectation of advantage to the party himself or from the ill will towards the
other is immaterial. The expression "fraud" involves two elements,
deceit and injury to the person deceived. Injury is something other than
economic loss, that is, deprivation of property, whether movable or immovable
or of money and it will include and any harm whatever caused to any person in
body, mind, reputation or such others. In short, it is a non-economic or
non-pecuniary loss. A benefit or advantage to the deceiver, will almost always
call loss or detriment to the deceived. Even in those rare cases where there is
a benefit or advantage to the deceiver, but no corresponding loss to the
deceived, the second condition is satisfied.
(See
Dr. Vimla v. Delhi Administration (1963 Supp. 2 SCR
585) and Indian Bank v. Satyam Febres (India) Pvt. Ltd. (1996 (5) SCC 550).
A
"fraud" is an act of deliberate deception with the design of securing
something by taking unfair advantage of another. It is a deception in order to
gain by another's loss. It is a cheating intended to get an advantage. (See
S.P. Changalvaraya Naidu v. Jagannath (1994 (1) SCC 1).
"Fraud"
as is well known vitiates every solemn act.
Fraud
and justice never dwell together. Fraud is a conduct either by letter or words,
which includes the other person or authority to take a definite determinative
stand as a response to the conduct of the former either by words or letter. It
is also well settled that misrepresentation itself amounts to fraud. Indeed,
innocent misrepresentation may also give reason to claim relief against fraud.
A fraudulent misrepresentation is called deceit and consists in leading a man
into damage by willfully or recklessly causing him to believe and act on
falsehood. It is a fraud in law if a party makes representations, which he
knows to be false, and injury enures therefrom although the motive from which
the representations proceeded may not have been bad. An act of fraud on court
is always viewed seriously.
A
collusion or conspiracy with a view to deprive the rights of the others in
relation to a property would render the transaction void ab initio. Fraud and
deception are synonymous. Although in a given case a deception may not amount
to fraud, fraud is anathema to all equitable principles and any affair tainted
with fraud cannot be perpetuated or saved by the application of any equitable
doctrine including res judicata. (See Ram Chandra Singh v. Savitri Devi and
Ors. (2003 (8) SCC 319).
"Fraud"
and collusion vitiate even the most solemn proceedings in any civilized system
of jurisprudence. It is a concept descriptive of human conduct. Michael Levi
likens a fraudster to Milton's sorcerer, Comus, who exulted in
his ability to, 'wing me into the easy hearted man and trap him into snares'.
It has been defined as an act of trickery or deceit. In Webster's Third New
International Dictionary "fraud" in equity has been defined as an act
or omission to act or concealment by which one person obtains an advantage
against conscience over another or which equity or public policy forbids as
being prejudicial to another. In Black's Legal Dictionary, "fraud" is
defined as an intentional perversion of truth for the purpose of inducing
another in reliance upon it to part with some valuable thing belonging to him
or surrender a legal right;
a
false representation of a matter of fact whether by words or by conduct, by
false or misleading allegations, or by concealment of that which should have
been disclosed, which deceives and is intended to deceive another so that he
shall act upon it to his legal injury. In Concise Oxford Dictionary, it has
been defined as criminal deception, use of false representation to gain unjust
advantage; dishonest artifice or trick. According to Halsbury's Laws of
England, a representation is deemed to have been false, and therefore a
misrepresentation, if it was at the material date false in substance and in
fact. Section 17 of the Indian Contract Act, 1872 defines "fraud" as
act committed by a party to a contract with intent to deceive another.
From
dictionary meaning or even otherwise fraud arises out of deliberate active role
of representator about a fact, which he knows to be untrue yet he succeeds in
misleading the representee by making him believe it to be true. The
representation to become fraudulent must be of fact with knowledge that it was
false.
In a
leading English case i.e. Derry and Ors.
v. Peek (1886-90) All ER 1 what constitutes "fraud" was described
thus: (All ER p. 22 B-C) "fraud" is proved when it is shown that a
false representation has been made
(i) knowingly,
or
(ii) without
belief in its truth, or
(iii) recklessly,
careless whether it be true or false".
But
"fraud" in public law is not the same as "fraud" in private
law. Nor can the ingredients, which establish "fraud" in commercial
transaction, be of assistance in determining fraud in Administrative Law. It
has been aptly observed by Lord Bridge in Khawaja v. Secretary of State
for Home Deptt. (1983) 1 All ER 765, that it is dangerous to introduce maxims
of common law as to effect of fraud while determining fraud in relation of
statutory law. "Fraud" in relation to statute must be a colourable
transaction to evade the provisions of a statute. "If a statute has been
passed for some one particular purpose, a court of law will not countenance any
attempt which may be made to extend the operation of the Act to something else
which is quite foreign to its object and beyond its scope. Present day concept
of fraud on statute has veered round abuse of power or mala fide exercise of
power. It may arise due to overstepping the limits of power or defeating the
provision of statute by adopting subterfuge or the power may be exercised for
extraneous or irrelevant considerations. The colour of fraud in public law or
administration law, as it is developing, is assuming different shades. It
arises from a deception committed by disclosure of incorrect facts knowingly
and deliberately to invoke exercise of power and procure an order from an
authority or tribunal. It must result in exercise of jurisdiction which
otherwise would not have been exercised. The misrepresentation must be in
relation to the conditions provided in a section on existence or non-existence
of which the power can be exercised. But non-disclosure of a fact not required
by a statute to be disclosed may not amount to fraud. Even in commercial
transactions non-disclosure of every fact does not vitiate the agreement. "In
a contract every person must look for himself and ensures that he acquires the
information necessary to avoid bad bargain. In public law the duty is not to
deceive. (See Shrisht Dhawan (Smt.) v. M/s. Shaw Brothers, (1992 (1) SCC 534).
In
that case it was observed as follows:
"Fraud
and collusion vitiate even the most solemn proceedings in any civilized system
of jurisprudence. It is a concept descriptive of human conduct. Michael levi
likens a fraudster to Milton's sorcerer, Comus, who exulted in his ability to,
'wing me into the easy-hearted man and trap him into snares'. It has been
defined as an act of trickery or deceit. In Webster's Third New International
Dictionary fraud in equity has been defined as an act or omission to act or
concealment by which one person obtains an advantage against conscience over
another or which equity or public policy forbids as being prejudicial to
another. In Black's Legal Dictionary, fraud is defined as an intentional
perversion of truth for the purpose of inducing another in reliance upon it to
part with some valuable thing belonging to him or surrender a legal right; a
false representation of a matter of fact whether by words or by conduct, by
false or misleading allegations, or by concealment of that which should have been
disclosed, which deceives and is intended to deceive another so that he shall
act upon it to his legal injury. In Concise Oxford Dictionary, it has been
defined as criminal deception, use of false representation to gain unjust
advantage; dishonest artifice or trick. According to Halsbury's Laws of
England, a representation is deemed to have been false, and therefore a
misrepresentation, if it was at the material date false in substance and in
fact.
Section
17 of the Contract Act defines fraud as act committed by a party to a contract
with intent to deceive another. From dictionary meaning or even otherwise fraud
arises out of deliberate active role of representator about a fact which he
knows to be untrue yet he succeeds in misleading the representee by making him
believe it to be true. The representation to become fraudulent must be of the
fact with knowledge that it was false. In a leading English case Derry v. Peek
[(1886-90) ALL ER Rep 1: (1889) 14 AC 337 (HL)] what constitutes fraud was
described thus:
(All Er
p. 22 B-C) 'Fraud is proved when it is shown that a false representation has
been made
(i) knowingly,
or
(ii) without
belief in its truth, or
(iii) recklessly,
careless whether it be true or false'."
This
aspect of the matter has been considered recently by this Court in Roshan Deen
v. Preeti Lal (2002 (1) SCC 100) Ram Preeti Yadav v. U.P. Board of High School
and Intermediate Education (2003 (8) SCC 311), Ram Chandra Singh's case (supra)
and Ashok Leyland Ltd. v. State of T.N.
and Another (2004 (3) SCC 1).
Suppression
of a material document would also amount to a fraud on the court. (see Gowrishankar
v. Joshi Amba Shankar Family Trust (1996 (3) SCC 310) and S.P. Chengalvaraya Naidu's
case (supra).
"Fraud"
is a conduct either by letter or words, which induces the other person or
authority to take a definite determinative stand as a response to the conduct
of the former either by words or letter. Although negligence is not fraud but
it can be evidence on fraud; as observed in Ram Preeti Yadav's case (supra).
In
Lazarus Estate Ltd. v. Beasley (1956) 1 QB 702, Lord Denning observed at pages
712 & 713, "No judgment of a Court, no order of a Minister can be
allowed to stand if it has been obtained by fraud. Fraud unravels
everything." In the same judgment Lord Parker LJ observed that fraud
vitiates all transactions known to the law of however high a degree of
solemnity. (page 722) These aspects were recently highlighted in the State of Andhra Pradesh and Anr. v. T. Suryachandr Rao
(2005 (5) SCALE 621) To give finality to the controversy, we appoint Mr.
Justice A.B. Palkar, a retired Judge of the Bombay High Court to examine the
354 cases. The relevant files shall be handed over to the Commission
immediately. The Commission is requested to complete the verification within
four months and submit its report to the State Government for necessary action.
The claimants whose cases are to be examined shall be given opportunity to have
their say before the Commission. The records of the Zilla Gaurav Samittee, High
Power Committee and the Committee appointed by the High Court shall be examined
by the Commission before issuing notice to he individual applicants to decide
the acceptability or otherwise of the claims for freedom fighters' pension. On
getting report of the Commission, the State Government shall take necessary
action. We make it clear that we have not expressed any opinion on the
acceptability or otherwise of the claims as the Commission appointed by this
Court shall examine those aspects.
The Commission
appointed by this Court shall be paid the same emoluments as are admissible to
a sitting Judge of the High Court for the duration of its work, which we expect
will be finished within a period of 4 months. The emoluments admissible to the
Commission shall be paid by the State Government, apart from other expenses
that may be incurred for functioning of the Commission.
The
appeals are allowed with no order as to costs.
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