Supreme Court of India (Division Bench (DB)- Two Judge)

Appeal (Civil), 8880 of 2016, Judgment Date: Feb 03, 2016

                                                                  Reportable

                        IN THE SUPREME COURT OF INDIA

                        CIVIL APPELLATE JURISDICTION

                        CIVIL APPEAL NO…………. OF 2016
                  [Arising out of S.L.P. [C] No.8880/2011]


State of U.P. & Ors.                                            … Appellants

                                      Vs.

Ravindra Kumar Sharma & Ors.                                   … Respondents



                               J U D G M E N T



ARUN MISHRA, J.



Leave granted.

2.    The question involved in  the  appeal  is  as  to  the  right  of  the
appellant to verify the disability certificates issued by the Medical  Board
under the provisions of the Persons with Disabilities (Equal  Opportunities,
Protection of Rights and Full Participation) Rules,  1996.  The  respondents
applied for BTC training course under the  physically  handicapped  category
on the basis of certificates  issued  under  the  aforesaid  Rules.  It  was
claimed that they completed the training and had  been  offered  appointment
in the primary schools run and managed by the  State  Government.  Complaint
was received from Bhartiya Viklang Sangh of illegal usurpation of the  quota
reserved for handicapped persons  on  the  basis  of  fraudulently  procured
certificates without suffering  from  the  disability  certified  under  the
Rules of 1996. The State Government issued an order dated  3.11.2009  making
a provision for constitution of fresh Medical Board in order to  verify  and
assess  the  disability  of  the  candidates.  The   candidates   questioned
communication dated 15.7.2010 issued by  the  Director,  State  Council  for
Educational  Research  &  Training  based  upon  the  G.O.  dated  3.11.2009
requiring them to appear before the Medical Board constituted  in  order  to
assess the  disability.  Out  of  the  234  candidates  selected  under  the
handicapped category on being examined by the Medical  Board  it  was  found
that 21% of the candidates were not handicapped.

3.    A Single Bench of the High Court of Allahabad vide judgment and  order
dated 31.8.2010 dismissed the writ application holding that under  the  Rule
framed in exercise of the powers under sub-sections (1) and (2)  of  section
73 of the Persons with  Disabilities  (Equal  Opportunities,  Protection  of
Rights and Full Participation) Act, 1995, the general eligibility  to  apply
for facilities, concessions and benefits admissible under the scheme of  the
Act is subject to such conditions as the State  Government  may  impose  and
the State Government has imposed a condition in the  order  dated  3.11.2009
of constitution of the Medical Board for  verification  of  the  disability.
Even otherwise under the rules there can be a review of  the  decision  upon
representation by the applicant and fresh order  can  be  passed.  Thus  the
certificate issued is not final.

4.    On appeal being preferred a  Division  Bench  of  the  High  Court  of
Allahabad by the impugned order has allowed the appeal  and  has  held  that
while the certificate has been issued in accordance with the Rules of  1996,
roving enquiry cannot be made until and unless fraud has been  detected,  it
is not permissible to reopen medical certification  carried  out  under  the
Rules of  1996.  However  the  High  Court  has  directed  that  a  physical
verification  may  be  made  and  if  the  candidate  has  not  been  issued
certificate of disability or otherwise or that he does not suffer  from  any
disability so certified which entitles him to such a  certificate,  in  that
event the candidate can be subjected to fresh medical  test  not  otherwise.
Accordingly the directions by the Government in order  dated  3.11.2009  and
by the Director on 15.7.2010 for physical verification be construed  in  the
aforesaid manner.

5.    It is apparent from Rules  of  1996  that  disability  certificate  is
required to be issued by Medical Board.  It can issue  permanent  disability
certificate or the Medical Board shall indicate the period  of  validity  in
the certificate in case where there is  any   chance  of  variation  in  the
degree of disability. In  case  of  refusal  of  disability  certificate  an
opportunity is required to be given to the applicant  of  being  heard,  and
there can be a  review  by  the  Medical  Board  on  representation  by  the
applicant and Rules contains a provision to the effect that the  certificate
issued by the Medical Board shall make a person eligible to apply.

6.    In the facts of the instant case there was a serious complaint  lodged
by Viklang Sangh of illegal usurpation of the quota reserved  for  specially
abled by large number of persons who were not in fact  specially  abled  and
have procured certificates  fraudulently  from  their  districts  under  the
Rules of 1996. On the basis of the said complaint Government has  issued  an
order for the purpose of verification of such  certificates  issued  by  the
Medical Board and certificates of 21% of selected candidates of  handicapped
category were found to be fraudulent. It is settled proposition of law  that
fraud vitiates and in such a case  when  large  number  of  candidates  have
illegally  usurped  the  reserved  seats  of  the  persons  suffering   from
disability the action of State Government did not call for interference.

7.    In Bhaurao Dagdu Paralkar v. State of Maharashtra & Ors. (2005) 7 SCC
605, it was observed :

“16. In Lazarus Estates Ltd. v. Beasley (1956) 1 All ER  341,  Lord  Denning
observed at QB pp. 712 and 713: (All ER p. 345 C)
“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, L.J.  observed  that  fraud  vitiates  all
transactions known to the law of however high a  degree  of  solemnity.  (p.
722) These aspects  were  recently  highlighted  in  State  of  A.P.  v.  T.
Suryachandra Rao (2005) 6 SCC 149.”

8.    In Ram Chandra Singh v. Savitri Devi (2003) 8  SCC  319  it  was  held
thus:
“15. x x x Fraud as is well known  vitiates  every  solemn  act.  Fraud  and
justice never dwell together.
16.  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 word or letter.
17.  It is also  well  settled  that  misrepresentation  itself  amounts  to
fraud. Indeed, innocent misrepresentation may  also  give  reason  to  claim
relief against fraud.
18. A fraudulent misrepresentation is called deceit and consists in  leading
a man into damage by wilfully 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 ensues therefrom although the  motive  from
which the representations proceeded may not have been bad.
                                  x x x x x
23. An act of fraud on court is always  viewed  seriously.  A  collusion  or
conspiracy with a view to deprive the rights of  others  in  relation  to  a
property would render the transaction void ab initio.  Fraud  and  deception
are synonymous.
                                  x x x x x
25. 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.

26. In Shrisht Dhawan v. Shaw Bros.  (1992) 1 SCC  534,  it  has  been  held
that: (SCC p. 553, para 20)

“20. Fraud and collusion vitiate even the most  solemn  proceedings  in  any
civilized system of jurisprudence. It is  a  concept  descriptive  of  human
conduct.”
                                  x x x x x
29. In Chittaranjan Das v. Durgapore Project Ltd.  (1995)  99  CWN  897,  it
has been held: (Cal LJ p. 402, paras 57-58)

“57. Suppression of a material  document  which  affects  the  condition  of
service of the petitioner, would amount to fraud in such matters.  Even  the
principles of natural justice are not required to be complied with  in  such
a situation.

58. It is now well known that a fraud vitiates all solemn acts.  Thus,  even
if the date of birth of the petitioner had  been  recorded  in  the  service
returns on the basis of the certificate  produced  by  the  petitioner,  the
same is not sacrosanct nor the respondent company would be bound thereby.”

9.    This Court in Express Newspapers (P) Ltd.& Ors.  v. Union of India  &
Ors. (1986) 1 SCC 133 at para 119 has held thus:

   “119. Fraud on power voids the order if it is  not  exercised  bona  fide
for the end design. There is a distinction  between  exercise  of  power  in
good faith and misuse in bad faith. The  former  arises  when  an  authority
misuses its power in breach of law, say, by taking into account  bona  fide,
and with  best  of  intentions,  some  extraneous  matters  or  by  ignoring
relevant matters. That would render the impugned act or order  ultra  vires.
It would be a case of fraud on powers. The misuse in bad faith  arises  when
the power is exercised for an improper motive, say, to satisfy a private  or
personal grudge or for wreaking vengeance of a  Minister  as  in  S.  Partap
Singh v. State of Punjab AIR 1964 SC 72. A power  is  exercised  maliciously
if its repository is motivated by personal animosity towards those  who  are
directly affected by its exercise. Use of a power  for  an  ‘alien’  purpose
other than the one for which the power is conferred  is  mala  fide  use  of
that power. Same is the position when an order is made for a  purpose  other
than that which finds place in the order.  The  ulterior  or  alien  purpose
clearly speaks of the misuse of the power and it was observed  as  early  as
in 1904 by Lord Lindley in General Assembly of Free Church  of  Scotland  v.
Overtoun (1904) AC 515, ‘that there is a condition implied in this  as  well
as in other instruments which create powers, namely, that the  powers  shall
be used bona fide for the purpose for which  they  are  conferred’.  It  was
said by Warrington, C.J. in Short v. Poole Corpn. (1926) Ch 66, that:

‘No public body can be regarded as having statutory authority to act in  bad
faith or from corrupt motives, and any  action  purporting  to  be  of  that
body, but proved to be committed in  bad  faith  or  from  corrupt  motives,
would certainly be held to be inoperative.’”

10.      The Division Bench of the High Court  has  ignored  and  overlooked
the material fact that verification has already been  done  by  the  Medical
Board and it has been found  that  certificates  of  21%  were  fraudulently
obtained. The High Court has issued a direction in the  impugned  order  for
physical verification of the candidate by the authorities  and  in  case  he
does not suffer from disability so certified candidate can be  subjected  to
fresh medical test. The High Court has  overlooked  that  on  mere  physical
verification it may not be possible to know various  kinds  of  disabilities
such as that of eyes, ear impairment etc. That  can  only  be  done  by  the
medical  examination  and  particularly  when  the  High  Court  itself  has
observed that in  case  there  is  genuine  suspicion  and  fraud  has  been
committed medical certification can be reopened. Direction  issued  in  this
regard has not been questioned by the respondents and in fact process of re-
verification was already over when High Court issued aforesaid directions.

11.   In our considered opinion in the peculiar facts of this case  of  such
a fraud and genuine suspicion raised in the  representation  lodged  by  the
Viklang Sangh and when 21% of  such  certificates  have  been  found  to  be
fraudulently  obtained  there  was  no  scope  for  the  Division  Bench  to
interfere and issue order to perpetuate fraud, writ is  to  be  declined  in
such a scenario and no equity can be claimed by the respondents.

12.   In the circumstance we set  aside  the  impugned  judgment  and  order
passed by the Division  Bench  of  the  High  Court  and  dismiss  the  writ
petition. However before taking any  action  against  the  individuals  they
shall be issued show cause in the matter and  thereafter  decision  will  be
rendered in accordance with law. Let this exercise  be  completed  within  a
period of four months. The appeal is allowed to the aforesaid extent.




                                                               ………………………..J.
                                                               (M.Y. Eqbal)



New Delhi;                                                      …………………….J.
February 3, 2016.                                             (Arun Mishra)