REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 4270 OF 2008 ARISING OUT OF

SPECIAL LEAVE PETITION (CIVIL) NO. 17005 OF 2006

K.D. SHARMA … APPELLANT

VERSUS

STEEL AUTHORITY OF INDIA  LTD. & ORS. …  RESPONDENT

J U D G M E N T C.K. THAKKER, J. 1. Leave granted.

2.     The present appeal arises out of the

judgment and order dated February 16, 2005 in

Miscellaneous Case Nos. 9 and 10 of 2005 and

Miscellaneous Case No. 57 of 2004 in Review

Petition No. 4 of 2002 passed by the High Court

of Orissa.

3. Shortly stated the facts of the case

are that respondent No. 1, Steel Authority of

India Ltd. (‘SAIL’ for short) issued tenders

for raising, transporting and loading of iron

ore lump and fines into railway wagons at Kalta

Iron  Mine.   The  tender  was  required  to  be

submitted in two parts: (i) Techno-Commercial

Parameters (Part-I) and (ii) Price Bid (Part-

II).  Price bid of the tender was to be opened

only  after  opening  of  the  Techno-Commercial

Parameters  and  if  the  bidder  was  found

qualified.  In response to the first notice

dated June 5, 2000, 19 tender papers were sold.

The  authorities,  however,  received  response

only  from  10  persons.   Techno-Commercial

Parameters (Part-I) was opened and it was found

that only one bidder, namely, M/s Ores India

Pvt.  Ltd.  (respondent  NO.  2  herein)  was

qualified.  The process, therefore, had to be

cancelled  because  for  opening  of  Price  Bid

(Part-II),  minimum  three  Techno-Commercially

qualified offers ought to have been there as

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per Clause 7.7 of Purchase/Contract Procedure,

2000.   Re-tender  was,  therefore,  issued  on

September 8, 2000, but it was also required to

be  cancelled  owing  to  ‘no  perceptible

improvement’ in the situation. The tender was

floated  for  the  third  time,  which  was

unsuccessful.   The  fourth  notice  inviting

tenders was issued on January 22, 2001. It met

with the same fate.  Then fifth time, tenders

were  invited  on  May  7,  2001  wherein  the

appellant was found eligible and qualified. His

bid was the lowest.  The said bid was accepted

and  the  work  was  entrusted  to  him.   The

decision taken by the first respondent (SAIL)

came to be challenged by respondent No. 2 in

the  High  Court  of  Orissa  by  filing  a  Writ

Petition being OJC No. 3508 of 2002.  The main

allegation of the petitioner before the High

Court (respondent No. 2 herein) was that first

respondent  (SAIL)  cancelled  previous  four

notices inviting tenders only with a view to

oblige the appellant and to entrust work to him

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who could not qualify himself earlier for want

of  requisite  eligible  criteria  in  tender

process. Ultimately, the standard as prescribed

earlier was relaxed and lowered down in the 5th

tender  notice.  When  the  present  appellant

became eligible and qualified, the tenders were

opened and his bid was illegally accepted by

SAIL.  The petition was heard on merits and the

High Court  vide its judgment and order dated

May  30,  2002  dismissed  the  petition.

Respondent No. 2, however, came to know that he

was  eligible  and  yet  his  case  was  not

considered.  He, therefore, filed a review in

the High Court which was registered as Review

Petition No. 4 of 2002.  By a judgment and

order  dated  February  3,  2003,  the  Division

Bench allowed the Review Petition and directed

the authorities (SAIL) to open fourth tender

and  consider  the  case  of  the  petitioner

(respondent  No.  2)  and  respondent  No.  3

(appellant)  afresh  in  accordance  with  law

within a period of one month from the receipt

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of the writ.  The above order was challenged by

the appellant by filing Special Leave Petition

in this Court. Special Leave Petition was also

filed  by  SAIL.   Both  the  Special  Leave

Petitions,  however,  were  dismissed  by  this

Court on November 28, 2003.

4. It  is alleged by the appellant that

after dismissal of Special Leave Petitions by

this Court, SAIL opened tender in presence of

the second respondent only without intimating

the appellant and in his absence.  SAIL also

negotiated the rates with the second respondent

and  decided  to  entrust  the  work  to  him.

Meanwhile,  several  applications  were  filed

before the High Court for clarification and/or

modification/ alteration of the order passed in

Review Petition.  Miscellaneous Case No. 46 of

2004  was  filed  by  respondent  No.  2  seeking

implementation of the order of the High Court

dated February 3, 2003. Miscellaneous Case No.

48 of 2004 was filed by SAIL for clarification

while Miscellaneous Case No. 57 of 2004 was

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filed  by  the  appellant  to  decide

disqualification  of  respondent  No.  2.

Miscellaneous Cases 9 and 10 of 2005 were also

said to have been filed requesting the High

Court  to  dispose  of  matters  in  view  of

compromise  and settlement  arrived at  between

the parties.  

5. The High Court by the impugned order

dated February 16, 2005, disposed of all the

applications  on  the  basis  of  the  settlement

said  to  have  been  arrived  at  between  the

parties which was duly recorded in the order

wherein the present appellant was also a party-

respondent.  The appellant came to know that

fraud  had  been  committed  by  the  respondents

upon  him  as  well  as  upon  the  Court.   He,

therefore, filed Miscellaneous Case No. 63 of

2005 on June 28, 2005 to recall the order dated

February  16,  2005  alleging  inter  alia  that

fraud  has  been  perpetrated  by  the  opposite

party on him as well as on the Hon’ble Court.

A  prayer  was  also  made  to  investigate  the

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matter by Central Bureau of Investigation (CBI)

or Vigilance Authorities.  Since nothing was

done by the High Court, he again approached

this  Court  by  filing  Special  Leave  Petition

which was registered as Special Leave Petition

(Civil) No. …… of 2006 (CC 2486 of 2006).  The

said petition came up for hearing before this

Court and was dismissed on May 12, 2006 as “not

pressed at this stage”.  It was observed that

if the petitioner would make a prayer before

the High Court for expeditious disposal of the

application  to  recall  the  order,  the  said

prayer  would be  considered appropriately  and

application would be disposed of accordingly.

It  is  the  case  of  the  applicant  that  even

thereafter the recall application had not been

placed before the Court and was not decided as

directed by this Court.  In the circumstances,

the appellant approached this Court by filing a

Special Leave Petition on September 6, 2006.

6. On  October  9,  2006,  the  matter  was

placed before this Court for admission hearing.

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Notice was issued to the respondents.  When the

matter was placed for further hearing on March

8, 2007, the following order was passed;

“Service is complete.

Though served, nobody appears on behalf of respondent No. 2 (original petitioner).  With a view to give one more  opportunity,  list  the  matter after two weeks”.

7. According to the appellant, it is only

after the above order that the wheels moved

very fast.  The respondents made all attempts

to  get  the  matter  on  Board  before  the  High

Court. The Court finally rejected the prayer of

the appellant for recalling of the order and

dismissed the application.  According to the

appellant,  all  those  actions  were  illegal,

contrary  to  law  and  deserve  interference  by

this Court.

8. We have heard the learned counsel for

the parties.

9. Learned  counsel  for  the  appellant

contended that fraud has been played upon the

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Court as well as upon the appellant and all

orders passed by the High Court deserve to be

quashed  and  set  aside  only  on  that  ground.

According to the appellant, when Miscellaneous

Petitions were placed before the High Court,

the  Court  was  bound  to  decide  them  in

accordance with law after hearing the parties.

Instead, the High Court disposed of all the

petitions  on  the  basis  of  `so-called’

settlement said to have been arrived at between

the parties.  So far as appellant is concerned,

he had never entered into any settlement or

compromise.   Mr.  C.M.  Ramesh,  Chairman  and

Managing Director of Rithwik Projects who was

earlier representative of the appellant and in

whose favour the appellant had issued Power of

Attorney had joined hands with respondent No. 2

and  was  virtually  won  over  by  him.  The

appellant had also revoked and withdrawn Power

of Attorney issued in favour of Ramesh and,

obviously  therefore,  he  had  no  authority  to

represent  the  appellant  and  could  not  have

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appeared  either before  SAIL for  negotiations

for  him  or  entered  into  any  compromise  or

settlement on behalf of the appellant.  It was

also contended that though for a substantial

long period, application for recalling of order

instituted by the appellant had not come on

Board and he had to approach this Court making

grievance  about  non-hearing  of  the  matter,

there was no progress whatsoever.  It was only

after  the  order  passed  by  this  Court  and

affording  an  opportunity  to  the  respondent

stating  that  if  he  would  not  appear,  an

appropriate  order  would  be  passed  that

respondent  No.  2  got  the  matter  hurriedly

disposed of in the High Court.  It was also the

allegation of the appellant that at the time of

hearing of Miscellaneous Cases, a new advocate

appeared on his behalf who was not engaged by

the appellant.  Some blank papers on which the

appellant might have singed earlier came to be

utilized for the purpose of making applications

for settlement showing that the appellant was

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agreeable  to such  settlement; the  settlement

was  produced  before  the  Court  and  on  that

basis, the matter were finally disposed of on

the  assumption  that  all  the  parties  had

compromised and amicably settled the matter and

nothing was required to be done. Accordingly

all the three Miscellaneous Petitions Nos. 46,

48 and 57 of 2004 were disposed of.  It was

submitted  that  in  these  circumstances,  the

order passed by the High Court deserves to be

quashed and set aside by remitting the matter

to  the  High  Court  so  that  the  recall-

application filed by the appellant be decided

afresh after hearing the parties.

10. The learned counsel for Respondent No.

1-SAIL  strongly  refuted  the  allegations

levelled by the appellant.  An affidavit-in-

reply is filed denying all the averments and

allegations against SAIL.  It was stated that

the order passed by the High Court in Review

Petition was challenged by SAIL, but Special

Leave  Petition  was  dismissed.   Thereafter

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obviously,  SAIL  was  required  to  act  in

accordance with the order passed by the High

Court in the Review Petition and confirmed by

this Court.  It was also submitted by learned

counsel  for  SAIL  that  bald  allegations  have

been  levelled  against  SAIL  by  the  appellant

without there being any material whatsoever in

support of such allegations.  On the contrary,

all  throughout  SAIL  has  acted  strictly  in

consonance with law.  The Counsel stated that

in accordance with the order passed by the High

Court  in  Review  Petition,  4th Tender  was

considered, notices were issued to respondent

No. 2 as also to the appellant herein.  The

appellant received the notice.  He addressed a

letter to SAIL stating therein that he would

remain  present  in  pursuance  of  the  notice

issued by SAIL through his Power of Attorney

and representative Ramesh of Rithwik Projects.

Accordingly,  Rithwik  Projects  through  its

Chairman and Managing Director Ramesh appeared

and a decision was taken to entrust contract to

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respondent No. 2.  In the circumstances, it

cannot  be  said  that  any  fraud  has  been

committed by SAIL either on the appellant or on

the Court.  The counsel for SAIL further stated

that the appellant has not been affected at

all.  It was stated that work entrusted to the

appellant was under tender notice 5 and not

under tender notice 4.  Period of tender notice

5 was for three years.  The said period of

three  years  was  over  and  the  appellant  had

completed the said work.  Thereafter there was

no  right  in  favour  of  the  appellant  nor  he

could insist continuance of the contract. The

counsel, therefore, submitted that the appeal

should be dismissed by this Court.

11. Even  otherwise,  according  to  the

counsel, no communication was sent at any point

of time by the appellant to SAIL that though

earlier  he  had  issued  Power  of  Attorney  in

favour of Ramesh of Rithwik Projects, it was

subsequently withdrawn or revoked and that he

would  not  represent  the  appellant  in  future

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before SAIL.  On the contrary, though notice

was  issued  by  SAIL  and  received  by  the

appellant, he did not remain present and sent a

communication to SAIL that Ramesh of Rithwik

Projects  would  represent  him.   It  was,

therefore, not open to the appellant thereafter

to turn round and make wild allegations against

SAIL nor is he entitled to any relief.

12. On behalf of respondent No. 2 - M/s

Ores  India  Pvt.  Ltd.,  the  counsel  contended

that no case whatsoever has been made out by

the appellant so as to interfere with the order

passed by the High Court.  According to the

counsel,  in  fact  SAIL  had  obliged  appellant

which was clear from the facts and proved from

the decision in the Review Petition by the High

Court.  When 4th tender notice was cancelled,

respondent  No.  2  instituted  a  writ  petition

challenging  the  said  action  of  SAIL.

Meanwhile, 5th tender notice was issued and the

bid of the present appellant was accepted by

SAIL.  The petition filed by respondent No. 2

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in  relation  to  4th tender  notice came  to  be

dismissed.  Subsequently, however, respondent

No. 2 came to know that though respondent No. 2

was eligible and qualified, SAIL had obliged

the present appellant by canceling the process

of 4th tender notice considering other bidders

ineligible and unqualified.  He, hence, filed

Review Petition.  In Review Petition, the Court

was  convinced  that  the  grievance  voiced  by

respondent No. 2 was correct and the action of

SAIL was wholly illegal and improper. Review

Petition was, therefore, allowed and SAIL was

directed  to  reconsider  the  Tender  Notice  by

treating the respondent No. 2 as eligible and

qualified.  Even observations were made by the

High Court against the conduct of officers of

SAIL.  The said order was challenged by SAIL as

also by the appellant but this Court did not

interfere.   4th Tender  was  thereafter

considered.  Notices were given to all bidders

including the appellant.  The bid of respondent

No. 2 was accepted and the work was entrusted

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to him.  It is, therefore, submitted that the

appellant  has  no  reason  or  ground  to  make

grievance against that action and the appeal

filed by him is liable to be dismissed.

13. We  have  considered  rival  contentions

of the parties.

14. The learned counsel for the appellant

alleged that fraud had been committed by the

respondents on the appellant as well as on the

Court. Only on that ground, the impugned action

of  SAIL  granting  contract  in  favour  of

respondent  No.2  deserves  to  be  set  aside.

According to the counsel, Ramesh, Chairman and

Managing Director of Rithwik Projects, in whose

favour  the  appellant  had  issued  Power  of

Attorney, had taken side of respondent No.2.

The Power of Attorney was, therefore, later on

withdrawn  by  the  appellant  and  yet  he  was

allowed  to  be  represented  for  the  appellant

before SAIL as also before the High Court and

‘so  called’  compromise  and  settlement  was

arrived at.  He was not authorized to do so

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against the interest of the appellant and on

his representation, the High Court could not

have disposed of Miscellaneous Cases.

15. It is well settled that “fraud avoids

all judicial acts, ecclesiastical or temporal”

proclaimed Chief Justice Edward Coke of England

before  about  three  centuries.  Reference  was

made by the counsel to a leading decision of

this Court in  S.P. Chengalvaraya Naidu (Dead)

by Lrs. V. Jagannath (Dead) by Lrs. & Ors.,

(1994)  1  SCC  1  wherein  quoting  the  above

observations,  this  Court  held  that  a

judgment/decree  obtained  by  fraud  has  to  be

treated as a nullity by every Court. 16. Reference  was also made to a recent

decision of this Court in A.V. Papayya Sastry

& Ors. V. Govt. of A.P. & Ors.,  (2007) 4 SCC

221. Considering English and Indian cases, one

of us (C.K. Thakker, J.) stated:

“It is thus settled proposition of law that  a  judgment,  decree  or  order obtained  by  playing  fraud  on  the Court,  Tribunal  or  Authority  is  a

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nullity and non est in the eye of law. Such a judgment, decree or order —by the first Court or by the final Court— has to be treated as nullity by every Court, superior or inferior. It can be challenged in any Court, at any time, in appeal, revision, writ or even in collateral proceedings”.  

17. The Court defined fraud as an act of

deliberate  deception  with  the  design  of

securing something by taking unfair advantage

of another. In fraud one gains at the loss and

cost  of  another.  Even  the  most  solemn

proceedings stand vitiated if they are actuated

by fraud. Fraud is thus an extrinsic collateral

act which vitiates all judicial acts, whether

in rem or in personam.

18. So far as the proposition of law is

concerned, there can be no two opinions. The

learned counsel for the respondents also did

not dispute the principles laid down in the

above  decisions  as  also  in  several  other

judgments. They, however, stated that on the

facts and in the circumstances of the case, the

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ratio  laid  down  in  the  above  cases  has  no

application.

19. As  already  adverted  to  earlier,

according to SAIL, pursuant to the order passed

by the High Court in Review and after dismissal

of Special Leave Petitions by this Court, it

issued  notices  to  the  parties  including  the

present  appellant.  Respondent  No.2  remained

present for negotiation. The appellant received

the notice but intimated SAIL that Ramesh of

Rithwik Projects would remain present on his

behalf. At no point of time, the appellant had

made any grievance against Ramesh nor he had

informed SAIL that he had withdrawn Power of

Attorney issued earlier in favour of Ramesh.

It,  therefore,  cannot  be  said  that  the

appellant was deceived or cheated, either by

SAIL or by anyone else.

20. The  argument  of  the  learned  counsel

for the appellant of violation of principles of

natural  justice  and  fair  play  also  has  no

force.  When notice was issued by SAIL to the

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appellant and he had informed SAIL by a written

communication that Ramesh would remain present

as his representative, it does not lie in the

mouth of the appellant that SAIL had acted in

breach of natural justice.

21. SAIL  in  its  written  submissions

contended  that  the  appeal  filed  by  the

appellant is liable to be dismissed on account

of suppression of material facts and deliberate

misrepresentation  by  him.  An  impression  was

sought  to  be  created  by  the  appellant,

submitted the counsel, that the appellant could

not  complete  the  work  given  to  him  and  was

assigned to respondent No.2. It is clear that

after  tender  notice  No.  4  was  cancelled,

albeit illegally as held by the High Court and

by this Court, tender notice No. 5 was issued.

The  bid  of  the  appellant  was  accepted  and

contract was given to him. It was for 2002-05

i.e. for three years. The appellant was allowed

to complete the said period and the contract

had  not  been  terminated  or  abruptly

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discontinued  during  the  said  period.  It  was

over in 2005 by efflux of time.  What was done

by  SAIL  was  to  implement  the  order  of  High

Court in connection with tender notice No. 4

which  was  not  acted  upon.  In  that  process,

parties were called for negotiations, offer of

respondent No.2 was accepted and work was given

to him. It is, therefore, not correct to say

that the appellant had suffered. The appellant

wanted to continue the work even though the

period of tender notice No. 5 was over and he

had  taken  the  benefit  thereunder.   The

appellant  had  no  right  or  reason  to  make

grievance so far as tender notice No. 4 was

concerned.   Hence,  the  appellant  is  not

entitled to any relief.

22. We  find  considerable  force  in  the

argument  of  the  learned  counsel.  From  the

record, it is clear that tender notice No.4 was

wrongly ignored and no process thereunder was

undertaken by SAIL. What was granted to the

appellant was a contract under tender notice

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No.5. The appellant was working under tender

notice  No.5.  Meanwhile,  the  review  of

respondent No.2 against tender notice No.4 was

allowed  and  after  the  order  passed  by  this

Court dismissing Special Leave Petitions, SAIL

implemented the said order, bid of respondent

No.2 was accepted and contract was given to

him. To us, SAIL is right in urging that the

appellant  cannot  insist  that  even  under  the

contract under tender notice No.5, he should be

allowed to continue the work. We, therefore,

see no substance in the argument of the learned

counsel for the appellant and the contention is

rejected.

23. The learned counsel for SAIL is also

right  in  urging  that  the  appellant  has  not

approached  the  Court  with  clean  hands  by

disclosing all facts.  An impression is sought

to be created as if no notice was ever given to

him nor he was informed about the consideration

of cases of eligible and qualified bidders in

pursuance of the order passed by the High Court

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in Review and confirmed by this Court. The true

facts, however, were just contrary to what was

sought to be placed before the Court. A notice

was  issued  by  SAIL  to  the  appellant,  he

received the notice, intimated in writing to

SAIL that he had authorized Ramesh of Rithwick

Projects to appear on his behalf. Ramesh duly

appeared at the time of consideration of bids,

bid of respondent No.2 was found to be lowest

and was accepted and contract was given to him

(under tender notice No.4). The said contract

had nothing to do with tender notice No.5 and

contract thereunder which had been given to the

appellant herein and he had completed the work.

Thus, it is clear that the appellant had not

placed all the facts before the Court clearly,

candidly and frankly.

24. The jurisdiction of the Supreme Court

under Article 32 and of the High Court under

Article  226  of  the  Constitution  is

extraordinary,  equitable  and  discretionary.

Prerogative writs mentioned therein are issued

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for  doing  substantial  justice.  It  is,

therefore,  of  utmost  necessity  that  the

petitioner approaching the Writ Court must come

with clean hands, put forward all the facts

before  the  Court  without  concealing  or

suppressing  anything and  seek an  appropriate

relief. If there is no candid disclosure of

relevant and material facts or the petitioner

is guilty of misleading the Court, his petition

may  be  dismissed  at  the  threshold  without

considering the merits of the claim.

25. The  underlying  object  has  been

succinctly  stated  by  Scrutton,  L.J.,  in  the

leading case of  R. v. Kensington Income Tax

Commissioners, (1917) 1 KB 486 : 86 LJ KB 257 :

116 LT 136 in the following words:

“[I]t has been for many years the rule of the Court, and one which it is of the greatest importance to maintain, that when an applicant comes to the Court to obtain relief on an ex parte statement he should make a full and  fair  disclosure  of  all  the material  facts-  it  says facts,  not law. He must not misstate the law if he can help it; the Court is supposed

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to know the law. But it knows nothing about  the  facts,  and  the  applicant must state fully and fairly the facts; and  the  penalty  by  which  the  Court enforces that obligation is that if it finds out that the facts have not been fully  and  fairly  stated  to  it  the Court will set aside any action which it  has  taken  on  the  faith  of  the imperfect statement”.

(emphasis supplied)

26. A prerogative remedy is not a matter

of course. While exercising extraordinary power

a Writ Court would certainly bear in mind the

conduct  of  the  party  who  invokes  the

jurisdiction  of  the  Court.  If  the  applicant

makes a false statement or suppresses material

fact  or  attempts  to  mislead  the  Court,  the

Court may dismiss the action on that ground

alone and may refuse to enter into the merits

of the case by stating “We will not listen to

your  application  because  of  what  you  have

done”.  The  rule  has  been  evolved  in  larger

public interest to deter unscrupulous litigants

from abusing the process of Court by deceiving

it.

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27. In Kensington Income Tax Commissioner,

Viscount Reading, C.J. observed: “Where  an  ex  parte  application  has been  made  to  this  Court  for  a  rule nisi  or other  process, if the  Court comes  to  the  conclusion  that  the affidavit in support of the applicant was  not  candid  and  did  not  fairly state the facts, the Court ought, for its own protection and to prevent an abuse  of  its  process,  to  refuse  to proceed  any  further  with  the examination of the merits. This is a power inherent in the Court, but one which  should  only  be  used  in  cases which bring conviction to the mind of the Court that it has been deceived. Before  coming  to  this  conclusion  a careful  examination  will  be  made  of the facts as they are and as they have been  stated  in  the  applicant’s affidavit,  and  everything  will  be heard that can be urged to influence the view of the Court when it reads the  affidavit  and  knows  the  true facts.  But  if  the  result  of  this examination and hearing is to leave no doubt  that  this  Court  has  been deceived, then it will refuse to hear anything further from the applicant in a proceeding which has only been set in  motion  by  means  of  a  misleading affidavit”.

     (emphasis supplied)

28. The  above  principles  have  been

accepted  in  our  legal  system  also.   As  per

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settled  law,  the  party  who  invokes  the

extraordinary jurisdiction of this Court under

Article 32 or of a High Court under Article 226

of the Constitution is supposed to be truthful,

frank and open. He must disclose all material

facts without any reservation even if they are

against him. He cannot be allowed to play `hide

and seek’ or to `pick and choose’ the facts he

likes to disclose and to suppress (keep back)

or not to disclose (conceal) other facts. The

very basis of the writ jurisdiction rests in

disclosure  of  true  and  complete  (correct)

facts.  If  material  facts  are  suppressed  or

distorted, the very functioning of Writ Courts

and  exercise  would  become  impossible.   The

petitioner must disclose all the facts having a

bearing  on  the  relief  sought  without  any

qualification.   This  is  because,  “the  Court

knows law but not facts”.   

29. If the primary object as highlighted

in Kensington Income Tax Commissioners is kept

in mind, an applicant who does not come with

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candid facts and ‘clean breast’ cannot hold a

writ  of  the  Court  with  `soiled  hands’.

Suppression or concealment of material facts is

not  an  advocacy.  It  is  a  jugglery,

manipulation, maneuvering or misrepresentation,

which has no place in equitable and prerogative

jurisdiction.  If  the  applicant  does  not

disclose  all  the  material  facts  fairly  and

truly but states them in a distorted manner and

misleads  the  Court,  the  Court  has  inherent

power in order to protect itself and to prevent

an abuse of its process to discharge the rule

nisi  and refuse to proceed further with the

examination of the case on merits. If the Court

does not reject the petition on that ground,

the  Court  would  be  failing  in  its  duty.  In

fact, such an applicant requires to be dealt

with  for  contempt  of  Court  for  abusing  the

process of the Court.

30. Let  us  consider  some  important

decisions on the point:

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31. In  State  of  Haryana  v.  Karnal

Distillery, (1977) 2 SCC 431, almost an agreed

order was passed by the Court that on expiry of

the  licence  for  manufacturing  of  liquor  on

September 6, 1976, the distillery would cease

to manufacture liquor under the licence issued

in  its  favour.  Then,  the  Company  filed  a

petition  in  the  High  Court  for  renewal  of

licence for manufacture of liquor for 1976-77,

and the Court granted stay of dispossession. In

appeal, the Supreme Court set aside the order

granting stay of dispossession on the ground

that  the  petitioner-Company  in  filing  the

petition in the High Court had misled it and

started  the  proceedings  for  oblique  and

ulterior motive. 32. In  Vijay Kumar v. State of Haryana,

(1983)  3  SCC  333,  it  was  the  case  of  the

petitioners  that  the  provisional  admissions

granted to them were not cancelled and they

were continuing their studies as post-graduate

students  in  Medical  College  on  the  relevant

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date.  On  the  basis  of  that  statement,  they

obtained an order of  status quo.  The Supreme

Court ordered inquiry and the District Judge

was  asked  to  submit  his  report  whether  the

provisional  admissions  granted  to  the

petitioners were continued till October 1, 1982

or were cancelled. The report revealed that to

the  knowledge  of  the  petitioners  their

provisional  admissions  were  cancelled  long

before  October  1,  1982  and  thus,  the

petitioners  had made  false representation  to

the Court and obtained a favourable order.

33.  Dismissing the petition, this Court

observed:

“But  for  the  misrepresentation  this Court would never have passed the said order. By reason of such conduct they have  disentitled  themselves  from getting any relief or assistance from this  Court  and  the  Special  Leave Petitions are liable to be dismissed”.

34. Deprecating the reprehensible conduct

of the petitioners as well as of their counsel,

the Court stated;

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“Before  parting  with  the  case, however, we cannot help observing that the  conduct or behaviour of the two petitioners as well as their counsel (Dr. A.K. Kapoor who happens to be a medico-legal consultant practising in Courts)  is  most  reprehensible  and deserves  to  be  deprecated.  The District Judge's report in that behalf is eloquent and most revealing as it points out how the two petitioners and their counsel, (who also gave evidence in  support  of  the  petitioner's  case before  the  District  Judge)  have indulged  in  telling  lies  and  making reckless allegation of fabrication and manipulation  of  records  against  the College  Authorities  and  how  in  fact the boot is on their leg. It is a sad commentary  on  the  scruples  of  these three young gentlemen who are on the threshold of their carriers. In fact, at one stage we were inclined to refer the  District  Judge's  report  both  to the Medical Council as well as the Bar Council for appropriate action but we refrained  from  doing  so  as  the petitioners' counsel both on behalf of his  clients  as  well  as  on  his  own behalf  tendered  unqualified  apology and sought mercy from the Court.  We, however,  part  with  the  case  with  a heavy  heart  expressing  our  strong disapproval  of  their  conduct  and behaviour…”

              (emphasis supplied)

35. In  Welcom  Hotel  v.  State  of  A.P.,

(1983) 4 SCC 575, certain hoteliers filed a

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petition in this Court under Article 32 of the

Constitution challenging the maximum price of

foodstuffs fixed by the Government contending

that it was uneconomical and obtained ex parte

stay order. The price, however, was fixed as

per the agreement between the petitioners and

the  Government  but  the  said  fact  was

suppressed.

36. Describing the fact as material, the

Court said:

“Petitioners who have behaved in this manner  are  not  entitled  to  any consideration  at  the  hands  of  the Court”.

37. In  Agricultural  &  Process  Food

Products v. Oswal Agro Furnae,  (1996) 4 SCC

297, the petitioner filed a petition in the

High  Court  of  Punjab  and  Haryana  which  was

pending.  Suppressing  that  fact,  it  filed

another petition in the High Court of Delhi and

obtained an order in its favour. Observing that

the  petitioner  was  guilty  of  suppression  of

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‘very important fact’, this Court set aside the

order of the High Court. 38. In  State  of  Punjab  v.  Sarav  Preet,

(2002) 9 SCC 601,  A  obtained relief from the

High Court on her assertion that a test in a

particular  subject  was  not  conducted  by  the

State. In an appeal by the State, it was stated

that not only the requisite test was conducted

but the petitioner appeared in the said test

and failed. Observing that the petitioner was

under an obligation to disclose the said fact

before the High Court, this Court dismissed the

petition. 39. In  Union of India v. Muneesh Suneja,

(2001) 3 SCC 92, the detenu challenged an order

of detention under the Conservation of Foreign

Exchange and Prevention of Smuggling Activities

Act, 1973 (COFEPOSA) by filing a petition in

the High Court of Delhi which was withdrawn.

Then he filed a similar petition in the High

Court of Punjab & Haryana wherein he did not

disclose the fact as to filing of the earlier

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petition  and withdrawal  thereof and  obtained

relief.  In  an  appeal  by  the  Union  of  India

against the order of the High Court, this Court

observed  that  non-disclosure  of  the  fact  of

filing  a  similar  petition  and  withdrawal

thereof  was  indeed  fatal  to  the  subsequent

petition. 40. A special reference may be made to a

decision of this Court in All India Sate Bank

Officers  Federation  v.  Union  of  India,  1990

Supp SCC 336. In that case, promotion policy of

the Bank was challenged by the Federation by

filing a petition in this Court under Article

32 of the Constitution. It was supported by an

affidavit and the contents were affirmed by the

President of the Federation to be true to his

‘personal  knowledge’.  It  was  stated:   “The

petitioners have not filed any other similar

writ petition in this Honourable Court or any

other High Court”.  

41. In  the  counter-affidavit  filed  on

behalf of the Bank, however, it was asserted

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that the statement was `false’. The Federation

had filed a writ petition in the High Court of

Andhra Pradesh which was admitted but interim

stay  was  refused.  Another  petition  was  also

filed in the High Court of Karnataka. It was

further pointed out that Promotion Policy was

implemented and 58 officers were promoted who

were not made parties to the petition.  

42. In affidavit-in-rejoinder, once again,

the stand taken by the petitioner was sought to

be justified. It was stated: “The deponent had

no knowledge of the writ petition filed before

the High Court of Andhra Pradesh, hence as soon

as it came to his knowledge the same has been

withdrawn. Secondly, the petitioners even today

do not know the names of all such 58 candidates

who  have  been  promoted/favoured”.  It  was

contended on behalf of the Bank that even that

statement was false. Not only the petitioner-

Federation was aware of the names of all the 58

officers who had been promoted to the higher

post,  but  they  had  been  joined  as  party-

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respondents in the writ petition filed in the

Karnataka High Court, seeking stay of promotion

of  those  respondents.  It  was,  therefore,

submitted that the petitioner had not come with

clean  hands  and  the  petition  should  be

dismissed on that ground alone.

43. ‘Strongly  disapproving’  the

explanation  put  forth  by  the  petitioner  and

describing  the  tactics  adopted  by  the

Federation as ‘abuse of process of court’, this

Court observed:  

“There is no doubt left in our minds that  the  petitioner  has  not  only suppressed  material  facts  in  the petition but has also tried to abuse judicial process. . . .  

Apart  from  misstatements  in  the affidavits  filed  before  this  Court, the petitioner Federation has clearly resorted to tactics which can only be described as abuse of the process of court. The simultaneous filing of writ petitions  in  various  High  Courts  on the same issue though purportedly on behalf  of  different  associations  of the  Officers  of  the  Bank,  is  a practice which has to be discouraged. Sri Sachhar and Sri Ramamurthy wished to  pinpoint  the  necessity  and importance of petitions being filed by

3

different  associations  in  order  to discharge  satisfactorily  their responsibilities  towards  their respective members. We are not quite able  to  appreciate  such  necessity where there is no diversity but only a commonness of interest. All that they had  to  do  was  to  join  forces  and demonstrate  their  unity  by  filing  a petition in a Single Court.  It seems the  object  here  in  filing  different petitions  in  different  Courts  was  a totally  different  and  not  very laudable one”.   (emphasis supplied)

44. ‘Deeply grieved’ by the situation and

adversely  commenting  on  the  conduct  and

behaviour  of  the  responsible  officers  of  a

Premier  Bank  of  the  country,  the  Court

observed;

“We have set out the facts in this case  at  some  length  and  passed  a detailed order because we are deeply grieved to come across such conduct on the part of an association, which claims  to  represent  high  placed officers of a premier bank of this country.  One  expects  such  officers to  fight  their  battles  fairly  and squarely  and  not  to  stoop  low  to gain,  what  can  only  be,  temporary victories  by  keeping  away  material facts from the court. It is common knowledge that, of late, statements are  being  made  in  petitions  and affidavits  recklessly  and  without

3

proper verification not to speak of dishonest  and  deliberate misstatements.  We,  therefore,  take this  opportunity  to  record  our strong and emphatic disapproval of the  conduct  of  the  petitioners  in this ease and hope that this will be a lesson to the present petitioner as well as to other litigants and that at least in future people will act  more  truthfully  and  with  a greater sense of responsibility.                 (emphasis supplied)

45. Yet in another case in  Vijay Syal & Anr. v. State of Punjab & Ors.,  (2003) 9 SCC

401; this Court stated; “In  order  to  sustain  and  maintain sanctity  and  solemnity  of  the proceedings  in  law  courts  it  is necessary  that  parties  should  not make false or knowingly, inaccurate statements  or  misrepresentation and/or  should  not  conceal  material facts  with  a  design  to  gain  some advantage or benefit at the hands of the  court,  when  a  court  is considered  as  a  place  where  truth and justice are the solemn pursuits. If  any  party  attempts  to  pollute such a place by adopting recourse to make  misrepresentation  and  is concealing material facts it does so at  its  risk  and  cost.  Such  party must be ready to take consequences that follow on account of its own making. At times lenient or liberal

3

or generous treatment by courts in dealing with such matters are either mistaken or lightly taken instead of learning proper lesson. Hence there is a compelling need to take serious view  in  such  matters  to  ensure expected  purity  and  grace  in  the administration of justice”.

46. In the case on hand, the appellant has

not come forward with all the facts. He has

chosen to state facts in the manner suited to

him by giving an impression to the Writ Court

that an instrumentality of State (SAIL) has not

followed  doctrine  of  natural  justice  and

fundamental principles of fair procedure. This

is not proper. Hence, on that ground alone, the

appellant cannot claim equitable relief. But we

have also considered the merits of the case and

even on merits, we are convinced that no case

has been made out by him to interfere with the

action of SAIL, or the order passed by the High

Court.

47. For the foregoing reasons, the appeal

deserves  to  be  dismissed  and  is  accordingly

dismissed with costs.

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    ………………………………………………J. (C.K. THAKKER)

NEW DELHI, …………………………………………………J. JULY 09, 2008.   (D.K. JAIN)

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