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2012 DIGILAW 388 (HP)

National Insurance Company Limited v. Manu

2012-07-16

DEV DARSHAN SUD

body2012
JUDGMENT Dev Darshan Sud, J (oral) The Insurance Company challenges the award of the learned Motor Accident Claims Tribunal, Fast Track Court, Solan awarding a sum of ‘ 7 lacs along with costs and interest to the respondent-claimant, who filed the claim petition in his capacity as a son of deceased Chuni Lal. 2. The only point urged before me in this appeal is that the award deserves to be set aside as it is the outcome of the fraud and active concealment of facts by the claimant. Learned counsel appearing for the appellant refers to Ext.RX, which is the judgment passed by the learned Motor Accident Claims Tribunal, Panchkula in MAC Petition No. 294 filed on 25.10.2001 and decided on 1.10.2002. Smt. Neelam Bajaj, widow, and Ashish Bajaj son of the deceased had instituted this claim petition before the learned Tribunal claiming compensation for the death of deceased Shri Chuni Lal. The learned Tribunal dismissed the petition in the absence of any positive evidence. I do not find any judgment/order on the record to the contrary whereby this award has been reversed/varied or modified. 3. Before the learned Claims Tribunal in the present petition, the claimant herein pleaded that he was a minor at the time when the accident took place. He claimed compensation on account of the death of his father late Shri Chuni Lal without disclosing the fact that prior to this, another petition had been instituted (supra), which had been dismissed by the learned Tribunal at Panchkula. 4. What I find from the material placed before the Court below is that though the point regarding the concealment of facts seems to have been urged indirectly but no attention has been paid by learned counsel for the Insurance Company, who seems to have been very casual about the entire case. But that did not exonerate the learned Tribunal from adjudicating on this issue if it was otherwise disclosed from the facts. True, the active concealment of facts and fraud as required by Order 6 Rule 4 of the Code of Civil Procedure were not pleaded by the Insurance Company but these facts were plain and evident from the material on record and in this eventuality, present petition was not maintainable. 5. Learned counsel appearing for the claimant submits that the claimant was a minor at the time of the accident. 5. Learned counsel appearing for the claimant submits that the claimant was a minor at the time of the accident. He was not a party to the proceedings before the learned Tribunal at Panchkula and in this eventuality, his interest could not be adversely affected by the two petitioners before the learned Tribunal. 6. If the claimant was minor, in that eventuality, his interest should and ought to have been protected by the claimants in the previous petition. If the award had been obtained by fraud, it was for the Insurance Company to urge the particular facts of concealment. Learned counsel appearing for the appellant urges that in this fact situation, the entire award requires to be set aside as being based on fraud and active concealment of facts. She places reliance on the judgment of the Supreme Court in United India Insurance Co. Ltd. vs. Rajendra Singh and others, 2000 ACJ 1032 holding: “2. ‘Fraud and justice never dwell together’ (Fraus et jus nunquam cohabitant) is a pristine maxim which has never lost its temper over all these centrueis. Lord Denning observed in a language without equivocation that “no judgment of a court, no order of a Minister can be allowed to stand if it has been obtained by fraud, for, fraud unravels everything.” (Lazarus Estate Ltd. v. Beasley, 1956(1) QB 702).3. For a High Court in India to say that it has no power even to consider the contention that the awards secured are the by-products of stark fraud played on a Tribunal, the plenary power conferred on the High Court by the Constitution may become a mirage and people’s faith in the efficacy of the High Courts would corrode. We would have appreciated if the Tribunal or at least the High Court had considered the pleas and found them unsustainable on merits, if they are meritless. Bus when the courts pre­empted the insurance company by slamming the doors against it, this court has to step in and salvage the situation 11.No one can possibly fault the insurance company for persistently pursuing the matter up to this court because it is dealing with public money. If it has discovered that such public fund, in a whopping measure, would be knocked off fraudulently through a fake claim, there is full justification for the insurance company in approaching the Tribunal itself first. If it has discovered that such public fund, in a whopping measure, would be knocked off fraudulently through a fake claim, there is full justification for the insurance company in approaching the Tribunal itself first. At any rate the High Court ought not to have refused to consider its grievances. What is the legal remedy when a party to a judgment or order of court later discovered that it was obtained by fraud?12.In S.P. Changalvaraya Naidu (dead) by L.Rs. v. Jagannath (dead) by L.Rs., 1994(1) SCC 1, the two Judges Bench of this court held:“Fraud avoids all judicial acts, ecclesiastical or temporal, observed Chief Justice Edward Coke of England about three centuries ago. It is the settled proposition of law that a judgment or decree obtained by playing fraud on the court is a nullity and non est in the eyes of law. Such a judgment/decree-by the first court or by the highest court-has to be treated as a nullity by every court, whether superior or inferior. It can be challenged in any court even in collateral proceedings....”13.In Indian Bank v. Satyam Fibres (India) Pvt. Ltd., 1996 CCJ 1272 (SC), another two Judges Bench, after making reference to a number of earlier decisions rendered by different High Courts in India, stated the legal position thus:“Since fraud affects the solemnity, regularity and orderliness of the proceedings of the court and also amounts to an abuse of the process of court, the courts have been held to have inherent power to set aside an order obtained by fraud practiced upon that court. Similarly, where the court is misled by a party or the court itself commits a mistake which prejudices a party, the court has the inherent power to recall its order.” (at pp. 1035-1036)She urges that this proposition of law now stands established beyond any pale of doubt. She places reliance on the judgment of Karnataka High Court in Branch Manager, United India Insurance Co. Ltd. vs. Chandrashekara and another 2007 ACJ 488, United India Insurance Co. Ltd. vs. Pawan Kumar Tikkiwal and others, 2007 ACJ 2570, National Insurance Co. Ltd. vs. Gaisuddin Khan and another 2007 ACJ 1140 in support of this contention. In particular, she submits that the facts of the present case are akin to those which have been adjudicated by the High Court of Karnataka in United India Insurance Co. Ltd. vs. Pawan Kumar Tikkiwal and others, 2007 ACJ 2570, National Insurance Co. Ltd. vs. Gaisuddin Khan and another 2007 ACJ 1140 in support of this contention. In particular, she submits that the facts of the present case are akin to those which have been adjudicated by the High Court of Karnataka in United India Insurance Co. Ltd. vs. Gaviyappa and others 2011 ACJ 2409. Lastly she places reliance on the judgment of the High Court of Jammu and Kashmir in New India Assurance Co. Ltd. vs. Raj Kumar and others 2010 ACJ 2535. 7. I have gone through these judgments and need not reproduce the principles of law as laid down there as I have already considered the point of law supra. I find that the learned Tribunal was casual in brushing aside the effect of the judgment of the previous litigation. I do find that the petitioner has not (a) pleaded his minority; (b) the fact that he was not aware about any prior claim petition having been filed; (c) or any other ground for not joining the previous proceedings. 8. Considering the entirety of the controversy, it would be in the fitness of things if the case is remanded to the learned Motor Accident Claims Tribunal at Solan which shall re-admit the case and proceed to determine the real controversy between the parties. It will be open to both the parties (a) to file such other or further pleadings/documents in support of their respective contentions that the award has/has not obtained by the concealment of facts etc.; (b) the reason if any as to why the claimant could not join the previous proceedings which included his disability of minority etc.; (c) to lead such other or further evidence in support of this issue only. For this purpose, the learned Tribunal shall grant an opportunity to both the parties to put their respective cases. 9. The order has been passed keeping in view the fact that serious allegations have been made by the Insurance Company against the claimant which are disputed by the claimant. Appeal stands disposed of. No order as to costs. Parties to appear before the learned Tribunal on 3rd September, 2012. Record of the case be sent back immediately. 9. The order has been passed keeping in view the fact that serious allegations have been made by the Insurance Company against the claimant which are disputed by the claimant. Appeal stands disposed of. No order as to costs. Parties to appear before the learned Tribunal on 3rd September, 2012. Record of the case be sent back immediately. The amount deposited by the Insurance Company in this Court shall remain invested in Fixed Deposit and shall not be disbursed to any party without prior permission of this Court.