Holding

A decree is not void for fraud unless fraud is proved with evidence of intent to deceive; mere concealment or non‑disclosure without such intent is insufficient.

Summary

Harjas Rai Makhija appealed to the Supreme Court alleging that the decree of 4 October 1999, which granted possession of a Bhopal plot to Pushparani Jain, was obtained by fraud because she allegedly concealed a Power of Attorney dated 30 April 1983. The Court held that fraud must be proved with evidence of intent to deceive; mere non‑disclosure or a bald allegation does not render a decree fraudulent. Makhija had previously been given a chance to produce additional evidence under Order XLI Rule 27 of the CPC but failed to do so, and his later suit was a collateral attack on the earlier decree. The Power of Attorney he relied upon was a photocopy of a photocopy and could not be admitted as secondary evidence. Since no specific fraud was pleaded or proved, the appeal was dismissed with costs.

Issues considered

Whether a decree can be set aside on the ground of fraud when the alleged fraud consists only of non‑disclosure of material facts without proof of intent to deceive.
Whether the appellant had a sufficient opportunity to prove fraud in the earlier proceedings and whether a fresh suit constitutes a permissible collateral attack.
Whether a photocopy of a photocopy of a Power of Attorney can be admitted as evidence to establish fraud.

Legislation cited

Code of Civil Procedure, 1908s. Order XLI Rule 27

Subjects

frauddecreeCivil Procedure Codeadditional evidencePower of Attorneyspecific performancecollateral attackintent to deceive

Judgment

[2017] l S.C.R. 1

HARJAS RAl MAKHIJA (D) THR. LRS. A
v.
PUSHPARANI JAIN & ANR.
(Civil Appeal No. 11491 of2016)
' B
JANUARY 02, 2017
[MADAN B. LOKUR AND AD,\RSH KUMAR GOEL, JJ.]
Fraud - Suit alleging that the defendant had obtained decree
in her favour fraudulently by non-disclosure of necessary and
relevant facts or concealment of material facts - Held: A mere C
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 as fraudulent - It is only after evidence is led,
coupled with intent to deceive, that a conclusion of fraud could be
arrived at - Fraud must be proved and not merely alleged or inferred
- The plaintiff had an opportunity to prove allegation of fraud in D
the previous suit, which he failed right upto Supreme Court - Even
in the plaint of the present suit, the plaintiff has not made any specific
a/legation of fraud having been played by the defendant while
obtaining the decree - In the present case, fraud has only been
alleged and not provej - Suit liable to be dismissed - Cost of E
Rs.50, 0001- imposed. .~

Dismissing the appeal, the Court
HELD: 1. There is no doubt th~t a decree was passed in
favour of respondent No.1 by the Distfict Judge on 4" October,
1999 after a full-fledged trial and thllt decree was upheld not only F
by the High Court but also by this Court. In that suit, the appellant
had made an application before the High Court to produce
additional evidence to suggest that the agreement for sale entered
into by him with respondent No.1 through her attorney on 16"
October, 1988 was genuine and based on the Power of Attorney
given by her on 30'' April, 1983. Not only was the application for G
bringing on record addilional evidence dismissed by the High
Court but the decree dismissing the suit for specific performance
of the agreement for sale filed by the appellant was also dismissed
by the High Court. That dismissal attain~d finality when the
petitions for special leave to appeal filed by the appellant were H
1

.---
2 SUPREME COURT REPORTS (2017) 1 S.C.R.

A dismissed by this Court. [Para IS) [6-G-H; 7-A)
2. Through a collateral attack, the appellant has now sought
to deprive respondent No.I of her allotment of the suit property
by alleging in the present suit that she had concealed the Power
of Attorney executed by her on 30" April, I983 and had thereby
B committed a fraud on the courts. [Para I7] [7-C-D]
3. When there is an allegation of fraud by non-disclosure of
necessary and relevant facts or concealment ,,; ::nateri;rl, 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 ar.rived
c 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.
D [Para 21] [8-B-D] ·
A. V. Papayya Sastry v. Government of A.P. [2007) 3
SCR 603 : (2007) 4 SCC 22I; Union of India v. Ramesh
Gandhi [2011] I6 SCR I26 : (2012) .I SCC 476 :-
referred to.
E
4. Fraud has a definite meaning'in'law and it must be proved
and not merely alleged and inferred. The appellant had an
opportunity to prove the allegation of fraud when he had filed an
application under Order XLI Rnle 27 of the CPC in the previous
suit. However, he missed that opportunity right up t>o this court.
F He took a second shot at alleging fraud and filing another suit. In
the plaint of the present suit, the appellant has nowhere made
·any specific allegation of a fraud having been played by respondent
No.I on the trial court while obtaining the decree dated 4"
October, I999. However, the evidence that he relied upon was
G very thin and could not even be considered as secondary evidence.
Accordingly both the trial court as well as the High Court rejected
the allegation of fraud by not accepting the evidence put forward
by the appellant to allege that fraud had been committed by
respondent No.I when she obtained the decree dated 4'' October,
I999. Fraud was not proved but merely alleged. [Paras I8, 22,
H 23 and 24) [7-D; 8-E, F-G; 9-A-B)
HARJAS RA! MAKHIJA (D) THR. LRS. v. PUSHPARANI JAIN 3
&ANR.

Meghmala & Ors. v. G Narasimha Reddy & Ors. [2010] A
10 SCR 47 : (2010) 8 SCC 383; Bhaurao Dagdu
Paralkar v. State of Maharashtra & Ors. [2005] 2
Suppl. SCR 774 : (2005) 7 SCC 605; State of Orissa &
Ors. v. Harapriya Bisoi (2009] 7 SCR 34 : (2009) 12
sec 378 - relied on. B
Case Law Reference
[21)071 3 SCR 603 referred to para 19
[20111 16 SCR 126 referred to para 20
[21)101 10 SCR 47 relied on para 22
(20051 2 Suppl. SCR 774 relied on para 22 c
[2009] 7 SCR 34 relied on para 22
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 11491
of2016 .
. From the Order dated 03.04.2012 by the High Court of Madhya o
Pradesh at Jabalpur in First Appeal No. 961 of2010.
Dr. Rajeev Dhavan, Sr. Adv., Ms. Pragati Neekhra, Kabira S.
Ghosh, Advs. for the Appellants.
'
Niraj Sharma, Sum it Kr. Sharma, Advs. for the Respondents.
E
The Judgment of the Court was delivered by
MADAN B. LOKUR, J. 1. The appellant (Harjas Rai Makhija
represented by his legal representatives) is aggrieved by the judgment
and order dated 3'' April, 2012 passed by the High Court of Madhya
Pradesh at Jabalpur in FA No.961 of2010 whereby his appeal has been
F
dismissed with costs ofRs.25,000/-.
2. Respondent No. I, Pushparani Jain (Pushparani) was allotted
Plot No.251 in Major Shopping Centre Zone - II, Habibganj, Bhopal
under Scheme No.13 of the Bhopal Development Authority (for short
BDA). Since she was a resident of the United States of America and
G
had some difficulty in completing the formalities with regard to the
allotment, she appointed her brother Jinendra Jain as her attorney on or
about 28'" August, 1981. This was communicated by her to the Chairman
of the BDA by a letter of the same date.
3. On the basis of the communication sent by Pushparani to the
H
4 SUPREME COURT REPORTS [2017] I S.C.R.

A BOA, and on the basis of the Powerof Attorney given by her to Jinendra
Jain, she was able to obtain possession of the plot allotted to her and
complete the necessary formalities ..
4. According to the appellant Harjas Rai Makhija (Makhija),
another Power of Attorney had been executed by Pushparani on 30"'
B April, 1983 in favour ofJinendra Jain. The original of this document has
not been produced by anybody. Be that as it may, on the basis of the
alleged Power of Attorney dated 30'h April, 1983, an agreement was
entered into between Jinendra Jain and Makhija on : o·'· October, 1988
to sell the plot allotted to Pushparani in favour of Makhija. In terms of
the agreement, the sale deed was to be executed on or before 30'h April,
c 1989.
5. When Pushparani came to know about the agreement for sale
in respect of the plot allotte11 to her, she filed a civil suit before the
District Judge, Bhopal and that suit subsequently came to be numbered
as Suit No. 51 ·A of 1999. The prayer made by Pushparani in the plaint
D was for a declaration that the agreement for sale dated I 6'h October,
1988 was without any authority given to Jinendra Jain. She also made a
prayer for recovery of possession and grant of mesne profits since
possession of the plot had been given by Jinendra Jain to Makhija.
6. Makhija also filed a civil suit before the District Judge which
E subsequently came to be numbered as Suit No.52-A of 1999. The prayer
made by Makhija was for specific performance of the agreement dated
I 6'h October, 1988 entered into by him with Pushparani through her
attorney Jinendra Jain.
7. Both the suits one filed by Pushparani irnd the other by Makhija
F were taken up and heard together. By a judgment-and decree dated 4'h
October, 1999 the suit filed by Pushparani was decreed with the result
that the agreement for sale dated I 6'h October, 1988 was declared to be
illegal. It was also decreed that Makhija shall handover possession of
the suit property to Pushparani and pay monthly compensation of
G Rs.5,000/- per month. The suit filed by Makhija was dismissed.
8. Feeling aggrieved by the result of the two suits mentioned above,
Makhija preferred two appeals before t!ie High Court being F.A; No.
607of1999 and F.A. No.638 of 1999 challenging the decree granted in
favour of Pushparani and the dismissal of his suit.
H
HARJAS RAJ MAKHIJA (DJ THR. LRS. v. PUSHPARANl JAIN 5
& ANR. [MADAN B. LOKUR, J.]

9. During the pendency of the aforesaid appeals, Makhija filed an A
application before the High Court under Order XU Rule 27 of the Code
of Civil Procedure' (for short the CPC) for adducing additional evidence.
By virtue of this application; Makhija sought to bring on record an
application said to have been filed by Jinendra Jain with the BDA on
behalf of Pushparani as her attorney for the grant of a No Objection
B
Certificate in respect of the suit property. According to the averment
made in the application, Jinendra Jain had moved the application before
the BDA on I" June, 1983.
I 0. By a judgment and order dated 13'h September, 2002 the High
Court dismissed both the appeals filed by Makhija as well as the
application under Order XL! Rule 27 of the CPC. While dismissing the
c
appeals and the application, the High Court held that no document was
produced before the Trial Court to establish that Pushparani had executed
a Power of Attorney in favour of J inendra Jain on 30'" April, 1983. The
High Court also noted that according to Makhija what was produced
before the BDA as the Power of Attorney dated 30'h April. 1983 was in D
fact a photocopy of the alleged Power of Attorney. Therefore, the High
Court took the view that a photocopy produced before it was a photocopy
of another photocopy (filed before the BDA) and as such it could not
even be considered as secondary evidence. Even otherwise, the "High
Comt concluded that there was no material to indicate that J inendra Jain
was authorized to enter into an agreement for sale the suit property on E
behalf of Pushparani.
11. Feeling aggrieved by the dismissal of the appeals as well as

1
Order XLI Rule 27. - Production of additional evidence in Appellate Court. - (I) The
parties to an appeal shall not be entitled to produce additional evidence, \Vhether oral F
or documentary, in the Appel late Court. But if -
(a) the Court from \vhose decree the appeal is preferred has refused to ad1nit evidence
\Vhich ought to have been ad111illed. or
(aa) the party seeking to produce additional evidence, estabui:ihcs that not\vithstanding
the exercise of due diligence, such evidence \Vas not \Vithin his kno\vledge or could
not, after the exercise of due diligence, be produced by hi1n at the tin1e \Vhcn the
decree appealed against \Vas passed. or
G
(b) the Appellate Court requires any docu1ncnt to be produced or any witness to be
exan1incd to enable it to pronounce judg1nent, or tbr any other substantial 'cause,
the Appellate Court n1ay allO\V such evidence or document to be produced, or \vitncss
to be examined.
(2) Wherever additional evidence is allo\\ ed to be produced by an Appellate
Courl. the Court shall record the reason for its admission. H
6 SUPREME COURT REPORTS [2017] 1 S.C.R.

A the application, Makhija preferred S.L.P.(C) Nos.524-525 of2003 which
came to be dismissed by this Court on 25" July, 2003. The review
petitions filed by Makhija also came to be dismissed by this Court on 9'h
September, 2003.
12. Notwithstanding the dismissal of Makhija's case, he was
B unrelenting and filed yet another suit before the Additional District Judge,
Bhopal which came to be numbered as Suit No.471-A of2008. In this
suit, he produced a certified copy of the Power of Attorney dated 30'h
April, 1983 allegedly filed by Jinendra Jain before the BOA. The prayer
made in the plaint filed by Makhija was for a declaration that the decree
dated 4'" October, I 99<fpassed in favour of Pushparani was obtained in
c a fraudulent manner and is void ;md not worthy of being executed. This
suit came to be dismissed by the Additional DistrictJudge by the judgment
and decree dated 28'" September, 20 I 0.
13. Feeling aggrieved by the dismissal of the suit filed by him,
Makhija preferred FA No. 961 of 2010 in the High Court of Madhya
D Pradesh. The appeal was taken up for consideration by the High Court
and by judgment and order dated 3'' April, 2012 (impugned) the appeal
was dismissed. The High Court took the view that the alleged Power of
Attorney dated 30'" April, 1983 could not be accepted as a valid piece of
documentary evidence being a certified copy of a photocopie<;l-document.
E It was also held that Makhija had an opportunity to raise the same issue
when the application for leading additional evidence was filed but did not
do so and cannot have a second shot for the same purpose. The allegation
of fraud leveled by Makhija was not accepted by the High Court.
14. Leariied counsel for Makhija raised quite a few submissions
F before us but in our opinion, the present appeal deserves to be dismissed
on the ground that no fraud has been alleged in the plaint fil~d by Makhija
or found in respect of the decree dated 4'" October, 1999.
a
15. There is no doubt that decree was passed in favour of
Pushparani by the District Judge on 4'" October, 1999 after a full-fledged
G
trial and that decree was upheld not only by the High Court but also by
this Court. Makhija made an application before the High.Court to produce
additional evidence to suggest that the agreement for sale entered into
by him with Pushparani through her attorney Jinendra Jain on 16'"
October, 1988 was genuine and based on the.Power of Attorney given
by her to JinendraJain on 30'" April, 1983. Not only was the application
H
HARJAS RAI MAKHIJA (D) THR. LRS. v. PUSHPARANI JAIN 7
& ANR. (MADAN B. LOKUR, J.]

for bringing on record additional evidence dismissed by the High Court A
but the decree dismissing the suit for specific performance of the
agreement for sale filed by Makhija was dismissed by the High Court.
That dismissal attained finality when the petitions for special leave to
I appeal filed by Makhija were dismissed by this Court.
16. It is significant to note that Makhija has not sought (and indeed B
could not seek) to reopen the proceedings pertaining to the dismissal of
his suit for specific perfonnance. As such, as mentioned above, the decree
dismissing his suit for specific performance of the agreement dated l 6'h
. October, 1988 has become final. Therefore, under no circumstances
can Makhija now collaterally pray for a decree of specific performance
in respect of that agreement.
c
17. Through a collateral attack, Makhija has now sought to deprive
Pushparani of her allotment of the suit property by alleging that she had
concealed the Power of Attorney executed by her in favour of Jinendra
Jain on 30'h April, 1983 and had thereby committed a fraud on the courts.
D
18. We have been taken through the plaint filed by Makhija.in Suit
No. 471-A of 2008 and find that he has nowhere made a)ly specific
allegation ofa fraud having been played by Pushparani on the Trial Court
whife obtaining the decree dated 4'h October, 1999.
19. During the course of submissions, it was contended on behalf E
of Makhija that it is a settled proposition of law that a decree obtained by
playing fraud on the court is a nullity and that such a decree could be
challenged at any time in any proceedings. Reliance was placed on A. V.
Papayya Sastry v. Govemme11t of A.P.' This proposition is ce11ainly
not in dispute.
F
20. Learned counsel also placed reliance on U11io11 of llldfrt v.
Ramesh Ga11dhP which reads as under:-
"27. If a judgment obtained by playing fraud on the court is a
nullity and is to be treated as 11011 est by every cou11, superior or
inferior, it would be strange logic to hear that an enquiry into the
G
question whether a judgment was secured by playing fraud on
the court by not disclosing the necessary facts relevant for
the adjudication of the controversy before the court is

2
(2007) 4 sec 221
'(2012) 1 sec 416
H
8 SUPREME COURT REPORTS (2017] I S.C.R.

A impermissible. From the above judgments, it is clear that such
an examination is permissible. Such a principle is required to
be applied ·with greater emphasis in the realm of public law
jurisdiction as the mischief resulting from such fraud has larger
dimensionaffeciing the larger public interest." (Emphasis supplied
by us).
B
21. 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
c allegation of fraud without proofand 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
vanishiQg point.
D 22. What is fraud has been adequately discussed in Meghmalt~
& Ors. v. G Narasimha Reddy & Ors.' Unfortunately, this decision
does not refer to earlier decisions where also there is an equally elaborate
discussion on fraud. These two decisions are Blwurao Dagtlu Paralkar
v. State of Maharashtra & Ors. .< and State of Orissa & Ors. v.
E Harapriya Bisoi. 6 In view of the elaborate discussion in these and
several other cases which have been referred to in these decisions, it is
clear that fraud has a definiie IJ1eaning in law and it must be prpved and
not merely alleged and inferred.
23. In so far as the present appeal is concerned, there is no doubt
F that Makhija had an opportunity to prove the allegation of fraud when he
filed an application under Order XLI Rule 27 of the CPC. However, he
missed that opportunity right up-to this court. Makhija took a second
shot at alleging fraud.and filingancither suit against Pushparani. However,
the evidence that he relied upon was very thin and could not even be
considered as secondary evidence. Accordingly both the Trial Court as
G well as the High Court rejected the allegation of fraud by not accepting
the evidence put forward by Makhija to allege that fraud had been

'(2010) 8 sec 383 (paragraphs 28 to 36)
'(2005) 7 SCC605
H '· (2009) 12 sec 378
HARJAS RA! MAKHIJA (D) THR. LRS. v. PUSHPARANl JAlN 9
& ANR. [MADAN B. LOKUR, J.]

committed by Pushparani when she obtained the decree dated 4'" October, A
1999.
24. Fraud not having been proved but merely alleged, we do not
find any reason to differ with the judgment and order passed by the High
Court and the Trial Court.
25. The appeal is dismissed with costs quantified at Rs.50,000/-. B

Kalpana K. Tripathy Appeal dismissed.