Full Judgment Text
NON-REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
IVIL PPEAL O F
C A N . 5784 O 2022
IVIL O
(@ S.L.P (C ) N . 7015/2022)
M Y P ALACE M UTUALLY A IDED …A PPELLANT ( S )
C O O PERATIVE S OCIETY
ERSUS
V
B. M AHESH & O RS . …R ESPONDENT ( S )
J U D G M E N T
N. V. Ramana, CJI
Leave granted.
1.
The present Civil Appeal has been filed by the appellant against
2.
impugned final judgment and order dated 21.09.2021, passed by
the High Court of Telangana in Interlocutory Application No.
5/2020 in Application No. 837/2013 in CS No. 7/1958.
3. The brief facts of this case necessary for the disposal of the appeal
Signature Not Verified
Digitally signed by
Rajni Mukhi
Date: 2022.08.23
17:18:34 IST
Reason:
are as follows: the present dispute relates to Sy. No. 57 (Old Sy.
1
No. 274) in Shamsguda Village, Ranga Reddy District, Telangana
forming part of S. No. 252 of the list of Mukthas in the preliminary
decree dated 06.04.1959 by the erstwhile High Court of Andhra
Pradesh in CS No. 7/1958.
The underlying original suit was filed in 1953 before the City Civil
4.
Court, Hyderabad by one Smt. Sultana Jahan Begum, the
daughter of Nawab Moinuddowla Bahadur. The plaintiff was
seeking partition of properties of the Nawab known as ‘Asman Jahi
Paigah’. This suit was ultimately transferred to the file of the High
Court numbered as C.S. No. 7/1958. The suit along with certain
applications were disposed of by a preliminarycumfinal decree
dated 06.04.1959 passed by the learned Judge of the High Court
of Andhra Pradesh. The judgment recorded that the plaintiff
withdraws the suit against defendant Nos. 27 to 49. It also
recorded that a compromise was affected amongst some of the
defendants. The litigation relating to this original suit
subsequently enters a complicated phase, wherein several different
parallel proceedings take place. Suffice to state, that even after 60
years, the issues in the same are not settled.
5. It is the say of the present appellant that they acquired the property
in Sy. No. 57 of Shamsguda Village under an Assignment Deed
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dated 16.09.2000 executed by the earlier predecessorininterest
under the preliminary decree. The predecessorsininterest had
also executed a Conveyance Deed dated 03.08.2003 in favour of
the appellant, conveying the schedule property with specific
boundaries. As the earlier Assignment Deed dated 16.09.2000 and
Conveyance Deed dated 03.08.2003 were unregistered documents,
the predecessorsininterest also executed a registered document
in favour of the appellant, namely a ‘Deed of Declaration/
Confirmation’ dated 12.08.2011.
6. On the above basis, an application (No. 837/2013) was filed in C.S.
No. 7/1958 by the appellant herein along with a party (not before
us) for passing a final decree in their favour in respect of property
measuring Acs 92.56 cts. and Acs. 27.00 gts land in Sy. No. 57 of
Shamsguda Village, Balanagar Mandal, Ranga Reddy District. A
further prayer was made for a direction to deliver the physical
possession of the said properties.
7. The learned Single Judge of the High Court of Andhra Pradesh
allowed the said Application in part vide final decree dated
19.09.2013 as sought by the appellant, and granted a declaration
that they are the absolute owners of Acs. 92.56 cts in Sy. No. 57 of
Shamsguda Village.
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The State of Andhra Pradesh challenged the said order in OSA SR
8.
No. 3744 of 2014. After formation of the State of Telangana on the
bifurcation of the composite State of Andhra Pradesh, the State of
Telangana filed IA No. 2 of 2016 seeking condonation of delay of
182 days in filing the Appeal. Responding to the said IA, the
appellant stated that the delay in filing of the Appeal is much
longer, amounting to 729 days. Thereafter, I.A. No. 2 of 2017 was
filed by the State of Telangana to condone a delay of 913 days in
filing the Appeal.
9. By order dated 22.12.2020, the Division bench of the High Court of
Telangana dismissed the two applications for condonation of delay
in filing the appeal, being I.A. No. 2 of 2016 and I.A. No. 2 of 2017.
As a consequence of the same, the State of Telangana’s appeal,
OSA SR No. 3744 of 2014 was dismissed.
10. In these circumstances, after lapse of nearly 7 years since the final
decree was granted in favor of the appellant herein, the
respondents herein filed 6 IAs (in Application 837/2013 in CS No.
7/1958) before the High Court of Telangana in 2020. The details of
the applications are as follows:
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| I.A No. | Prayer |
|---|---|
| 1/2020 | To grant leave to the respondents to file implead petition<br>in the abovementioned application. |
| 2/2020 | To dispense with the filing of a neatly typed copy of<br>material papers in application filed in the<br>abovementioned application |
| 3/2020 | To allow impleadment |
| 4/2020 | To allow impleadment. |
| 5/2020 | To recall the order dated 19.09.2013 passed in the<br>abovementioned application and to set aside and pass<br>such other order or orders as deemed fit and proper in<br>the circumstances of the case |
| 6/2020 | To direct the appellant to not to alienate, not to<br>interfere, not to change peaceful possession, not register<br>any documents in scheduled property in Sy No.57 and<br>any subdivision numbers in Sy No 57 of Shamsguda in<br>the abovementioned application. |
11. A Division Bench of the High Court of Telangana vide order dated
05.01.2021, allowed IA No. 1/2021 preferred by the respondents
and granted them leave to file the application recalling the final
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decree dated 19.09.2013, passed by the learned Single Judge of
the High Court in Application No. 837/2013 in C.S No. 7/1958.
12. The aforesaid order was challenged before this Court in an earlier
Special Leave Petition, being SLP(C) No. 8025/2021. This Court, by
order dated 06.07.2021, dismissed the said petition and gave the
parties liberty to raise all objections when the substantial
application for recalling the final decree was being heard.
13. After hearing the submissions of the parties, the Division Bench of
the High Court in I.A No. 5/2020 in Application No. 837 of 2013 in
CS No. 7 of 1958, passed the impugned order dated 21.09.2021,
allowing the recall of the final decree dated 19.09.2013.
14. One of the primary objections taken by the appellant herein before
the Division Bench of the High Court related to the fact that the
senior member of the Bench hearing the recall application was
presiding over the Bench which had heard and dismissed the
appeal filed by the State of Telangana against the same final
decree dated 19.09.2013. On this issue, the Division Bench held
that the earlier appeal filed by the State of Telangana had been
dismissed as a consequence of the dismissal of the application for
condonation of delay in filing the appeal filed by the State. There
was no discussion on the merits of the matter, particularly the
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claim of the appellant. Further, the Division Bench held that as
per the roster prepared by the Hon’ble Chief Justice of the High
Court of Telangana, all matters arising out of C.S. No. 7 of 1958
were placed before it. As such, the Division Bench held that there
were no strong reasons put forth by the appellant for the said
member of the Bench to recuse from the hearing of the present
matter.
15. The High Court, on merits, held that the appellant had obtained the
final decree dated 19.09.2013 by suppressing certain information
and by exercising its powers under Section 151, Code of Civil
Procedure, 1908 (“ CPC ”), has recalled its earlier final decree dated
19.09.2013. At the same time, the High Court clarified that
recalling of the order would not enure to the benefit of the State of
Telangana, whose appeal had already been dismissed, or the
respondents, who would have to establish their right, title and
interest in the subject property in appropriate proceedings.
16. Aggrieved by the impugned judgment of the High Court recalling the
final decree dated 19.09.2013, the appellant has approached this
Court by way of the present Civil Appeal.
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17. It is appropriate to mention here that the State of Telangana,
despite dismissal of its appeal in 2020, and the specific
observations of the High Court in the impugned order, initially
filed an impleadment application, being IA No. 98965/2022, in the
present Civil Appeal. This Court dismissed the abovementioned
application for impleadment vide order dated 22.07.2022.
18. The State of Telangana also filed separate Special Leave Petitions
challenging the present impugned order dated 22.12.2020, as well
and the earlier order dated 22.12.2020 dismissing their intra court
appeal [SLP (C) No. 13453 of 2022 and SLP (C) No. 13454 13456
of 2022]. These Special Leave Petitions were heard on 01.08.2022
by this Court and were dismissed in light of the observations made
by the High Court in paragraph 116 of the impugned order. In any
case, the claim of the State over the scheduled property is not
sufficiently supported by any documentary evidence.
19. Dr. A. M. Singhvi, learned Senior Counsel appearing on behalf of
the appellant, submitted as follows:
(i) No recall application could have been filed by the respondents.
Their only remedy was a separate civil suit for declaration of
title.
(ii) The preliminary decree in the matter was passed on
06.04.1959 and the final decree in favour of the appellant was
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passed on 19.09.2013. The appeal preferred by the State of
Telangana challenging the final decree was dismissed by the
High Court on 22.12.2020. The respondents’ application for
recall of final decree, in which the impugned order has been
passed, was filed before the High Court on 16.12.2020, raising
issues of fraud for the first time. The High Court ought to have
dismissed the application for recall on the grounds of delay.
(iii) A reading of the impugned order shows that the survey
numbers claimed by the respondents are distinct from those
claimed by the appellant.
(iv)
The Senior Judge heading the Division Bench, Justice M.S.
Rama Chander Rao who passed the impugned judgment
appeared on behalf of one of the parties who were claiming
possession in parallel proceedings relating to the subject
property, which party had also filed an FIR against the
appellant herein.
(v) The respondents alleged fraud on the basis of nondisclosure
of certain orders passed against the appellant. The first such
order is of 10.06.2003, whereby the High Court set aside
recognition of the assignment deed in favor of the appellant.
The second order is of 26.08.2013, passed in injunction
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proceedings preferred by the appellant against the revenue
authorities. However, both these orders were passed at a time
when the assignment deed in favour of the appellant was
unregistered. At the time when final decree was passed in
2013 the appellant had a registered assignment deed in their
favour with respect to the subject property. The earlier orders
are therefore not relevant.
(vi) The fact that the subject property had certain proceedings
pending against it was recorded in the preliminary decree, and
the same was in the notice of the learned Single Judge at the
time of passing of the final decree in 2013. No fraud can be
alleged on this ground by the respondents.
20. Mr. Dushyant Dave, learned Senior Counsel also appearing on
behalf of the appellant, submitted as follows:
(i) After the final decree was passed on 19.09.2013, the
respondents, who are rank outsiders to the proceedings, filed
the application for recall only in 2020. The respondents have
neither provided an explanation as to the delay, nor have they
filed any application for condonation of delay.
(ii) The affidavit supporting the application for recall was filed by
power of attorney holders. The person who signs the affidavit
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must have personal knowledge of the facts. Without such
personal knowledge, such an affidavit could not have been
filed.
(iii) The present litigation is nothing but a proxy litigation.
Unrelated third parties are seeking to interfere in the present
matter as the value of the subject property is very high.
(iv)
The allegations of fraud were never taken before any forum
until the impugned recall application before the High Court.
Such plea taken by the third party without any supporting
documents cannot be raised at a belated stage.
(v)
Once the State’s appeal against the final decree was dismissed
on grounds of delay, the respondents’ recall application
should have been similarly dismissed.
21. Mr. C. S. Sundaram, learned Senior Counsel appearing on behalf
of respondent No. 1, submitted as follows:
(i)
respondent No.1 is claiming through the original pattedar of the
property. The recall applications were filed soon after his
possession over the property was sought to be disturbed.
Therefore, the question of delay does not arise.
(ii) The preliminary decree indicates that the title to the suit
property was conditional. The respondents’ claim was upheld
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in the Atiyat Court, which was not shown before the learned
Single Judge at the time of passing of the final decree on
19.09.2013.
(iii)
Respondents had also filed another application seeking leave
to file the recall application, which was allowed by the High
Court on 05.01.2021. The Special Leave Petition against the
same was dismissed by this Court on 06.07.2021 and, as
such, the locus of the parties to file recall application cannot
be questioned at this stage.
(iv)
The Court always has the power to recall its order, if such an
order was obtained by playing fraud upon the Court.
(v) Ultimately, the impugned order does not decide the title of the
parties. The parties have been relegated to file a civil suit to
decide title. The appellant may exercise its right and do the
same.
22. Mr. V. Giri, learned Senior Counsel appearing on behalf of the
respondents no. 3 to 8, submitted as follows:
(i) The preliminary decree was a conditional decree as it was subject
to pending Revenue Court proceedings.
(ii)
The respondents are the pattedars of the property who were
owners in possession.
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(iii) The appellant’s earlier application seeking delivery of the
property on the basis of assignment deed was remanded to the
Single Judge and subsequently dismissed for nonprosecution
as it was not pressed. They abandoned their original
application. Additionally, the civil suit filed by the appellant for
injunction in 2007 was also dismissed.
(iv)
None of these facts and findings against the appellant were
disclosed by them in 2013 when the final decree was sought. It
is a clear case of fraud on the Court.
(v) In any event, no final decree could have been passed on the
assignment deed as no order for partition of property was ever
passed.
(vi)
These points moved the learned Division Bench in allowing the
recall application filed by the respondents. The impugned order
therefore, merits no interference by this Court.
23. Mr. Yatin Oza, learned Senior Counsel appearing on behalf of the
respondent no. 4, submitted as follows:
(i)
The conduct of the appellant is clear for all to see. They
committed fraud on the Court to have the final decree dated
19.9.2013 passed in their favour by supressing judgement of
Nazim Atiyat.
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(ii)
The fundamental principle of equity is that the parties must
come to Court with clean hands. In the present case, this
Court should not show any indulgence to the appellant by
interfering with the wellreasoned impugned judgment of the
High Court under Article 136 of the Constitution.
24. We have heard the learned Senior counsel on either side, perused
the entire material on record. Though several grounds have been
raised, the first ground taken is that the High Court erred in
exercising jurisdiction under Section 151 of the CPC, when
alternate remedies exist under the CPC. Second ground is that the
Senior Judge on the Bench, who appeared for one of the parties,
ought not to have heard the matter.
25. In response to the first leg of challenge, i.e. , on the procedural
aspect, we may note that the recall application was filed under
Section 151 of the CPC against the final decree dated 19.09.2013.
It is in this context that we must ascertain whether a third party to
a final decree can be allowed to file such applications, by invoking
the inherent powers of the Court under Section 151 of the CPC.
26. Section 151 of the CPC provides for Civil Courts to invoke their
inherent jurisdiction and utilize the same to meet the ends of
14
justice or to prevent abuse of process. Although such a provision is
worded broadly, this Court has tempered the provision to limit its
ambit to only those circumstances where certain procedural gaps
exist, to ensure that substantive justice is not obliterated by hyper
technicalities. As far back as in 1961, this Court in
Padam Sen v.
State of U.P ., AIR 1961 SC 218, observed as under:
“8. …The inherent powers of the Court are in
addition to the powers specifically conferred on
the Court by the Code . They are complementary
to those powers and therefore it must be held
that the Court is free to exercise them for the
purposes mentioned in Section 151 of the Code
when the exercise of those powers is not in any
way in conflict with what has been expressly
provided in the Code or against the intentions of
the Legislature. It is also well recognized that the
inherent power is not to be exercised in a
manner which will be contrary to or different
from the procedure expressly provided in the
Code.”
( emphasis supplied )
27. In exercising powers under Section 151 of the CPC, it cannot be
said that the civil courts can exercise substantive jurisdiction to
unsettle already decided issues. A Court having jurisdiction over
the relevant subject matter has the power to decide and may come
either to a right or a wrong conclusion. Even if a wrong conclusion
is arrived at or an incorrect decree is passed by the jurisdictional
15
court, the same is binding on the parties until it is set aside by an
appellate court or through other remedies provided in law.
28. Section 151 of the CPC can only be applicable if there is no
alternate remedy available in accordance with the existing
provisions of law. Such inherent power cannot override statutory
prohibitions or create remedies which are not contemplated under
the Code. Section 151 cannot be invoked as an alternative to filing
fresh suits, appeals, revisions, or reviews. A party cannot find
solace in Section 151 to allege and rectify historic wrongs and
bypass procedural safeguards inbuilt in the CPC.
29. The respondents in the present case had access to recourse under
Section 96 of the CPC, which allows for appeals from an original
decree. It must be remembered that the present matter was being
heard by the High Court exercising its original jurisdiction. The
High Court was in effect conducting a trial, and the final decree
passed by the High Court on 19.09.2013 was in effect a decree in
an original suit. As such, there existed a right of appeal under
Section 96 of the CPC, for the respondents. Though they were not
parties to the suit, they could have filed an appeal with the leave of
the Court as an affected party. Section 96 of the CPC reads as
under:
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96. Appeal from original decree .(1) Save where
otherwise expressly provided in the body of this
Code or by any other law for the time being in force,
an appeal shall lie from every decree passed by any
Court exercising original jurisdiction to the Court
authorized to hear appeals from the decisions of
such Court.
(2) An appeal may lie from an original decree passed
ex parte .
(3) No appeal shall lie from a decree passed by the
Court with the consent of parties.
[(4) No appeal shall lie, except on a question of law,
from a decree in any suit of the nature cognizable by
Courts of Small Causes, when the amount or value
of the subjectmatter of the original suit does not
exceed [ten thousand rupees.]
30. Sections 96 to 100 of CPC deals with the procedure for filing
appeals from original decrees. A perusal of the above provision
makes it clear that the provisions are silent about the category of
persons who can prefer an appeal. But it is well settled legal
position that a person who is affected by a judgment but is not a
party to the suit, can prefer an appeal with the leave of the Court.
The sine qua non for filing an appeal by a third party is that he
must have been affected by reason of the judgment and decree
which is sought to be impugned.
31. In the light of the above, it can be safely concluded any aggrieved
party can prefer an appeal with the leave of the Court.
17
32. The High Court, in the impugned judgment, relied on the judgment
of this Court in .,
Indian Bank vs Satyam Fibres (India) Pvt. Ltd
(1996) 5 SCC 550, wherein this Court acknowledges the possibility
of maintaining a recall application against a judgement if it is
obtained by fraud on the Court. However, it went on to hold that in
cases of fraud, the Court may direct the affected party to file a
separate suit for setting aside the decree obtained by fraud. The
Court held as follows:
“ 22. The judiciary in India also possesses
inherent power, specially under Section 151
CPC, to recall its judgment or order if it is
obtained by fraud on court. In the case of fraud
on a party to the suit or proceedings, the court
may direct the affected party to file a separate
suit for setting aside the decree obtained by
fraud…”
33. The subsequent judgment of this Court in
Ram Prakash Agarwal
v. Gopi Krishan , (2013) 11 SCC 296 further clarifies the law on
the use of the power under Section 151 of the CPC by the Court in
cases of fraud and holds as follows:
“13. Section 151 CPC is not a substantive
provision that confers the right to get any relief of
any kind. It is a mere procedural provision which
enables a party to have the proceedings of a
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pending suit conducted in a manner that is
consistent with justice and equity. The court can
do justice between the parties before it. Similarly,
inherent powers cannot be used to reopen
settled matters. The inherent powers of the Court
must, to that extent, be regarded as abrogated by
the legislature. A provision barring the exercise of
inherent power need not be express, it may even
be implied. Inherent power cannot be used to
restrain the execution of a decree at the instance
of one who was not a party to suit. Such power is
absolutely essential for securing the ends of
justice, and to overcome the failure of justice.
The Court under Section 151 CPC may adopt any
procedure to do justice, unless the same is
expressly prohibited.
Xxx
19. In view of the above, the law on this issue
stands crystallised to the effect that the
inherent powers enshrined under Section 151
CPC can be exercised only where no remedy
has been provided for in any other provision
of CPC . In the event that a party has obtained a
decree or order by playing a fraud upon the
court, or where an order has been passed by a
mistake of the court, the court may be justified
in rectifying such mistake, either by recalling the
said order, or by passing any other appropriate
order.
However, inherent powers cannot be
used in conflict of any other existing
provision, or in case a remedy has been
provided for by any other provision of CPC.
Moreover, in the event that a fraud has been
played upon a party, the same may not be a
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case where inherent powers can be exercised .”
(emphasis supplied)
34. The High Court, relying upon the above judgments of this Court
which recognizes the power to recall, seems to have lost sight of
the restrictions imposed while exercising jurisdiction under
Section 151 of the CPC, which were elaborately discussed by this
Court in the above referred judgment about exercising of the power
under Section 151 of the CPC being only in circumstances where
alternate remedies do not exist.
35. Therefore, we are of the firm opinion that recalling a final decree in
such circumstances cannot be countenanced under Section 151 of
the CPC. The High Court erred in exercising its jurisdiction under
Section 151 of the CPC, to hear and pass a detailed judgment
recalling its earlier final decree dated 19.09.2013, rather than
directing the respondents to pursue the effective alternate
remedies under law. Having said the above, we must clarify that
we are not, in any way, doubting the proposition of law that fraud
nullifies all proceedings, or that the Court has power to recall an
order which was passed due to a fraud played on the Court.
However, while exercising the power under Section 151 CPC for
20
setting aside the final judgment and decree, the Division Bench
should have taken into consideration the restriction which was
observed by this Court in the captioned judgment. Once we have
come to the irresistible conclusion that exercising power under
Section 151 CPC in the facts and circumstances of the case is bad,
we are not inclined to go into further issues that were extensively
argued.
36. The other ground that the learned senior judge who passed the
present impugned order had represented one of the opposite
parties in certain collateral proceedings related to the subject
property, merits some discussion. It appears that although the
appellant raised this ground before us, it was neither raised before
the High Court nor brought to the attention of the learned senior
Judge. The party ought to have raised this issue also at the time of
arguments, particularly when the issue of recusal of the learned
Judge had been specifically raised on the other ground that he had
been the presiding member of the Bench which had dismissed the
appeal filed by the State.
When an issue was not raised before the learned Division Bench,
37.
we do not wish to spill much ink on this issue. However, the
21
material placed on record by the counsel for the appellant cannot
be ignored. Annexure P8 of the appeal paper book indicates that
the Senior Judge heading the Division Bench, while being an
advocate, had represented the Andhra Pradesh State Financial
Corporation in one of the connected proceedings related to this
case.
38. Although we have no doubt in our mind about the absence of bias
of any form of the learned senior Judge, we must at the same time
also look at the issue of whether right minded persons could
consider there exists any real likelihood of bias. In the case of
State of West Bengal v. Shivananda Pathak, 1998 5 SCC 513,
this Court held as under:
“34. In Metropolitan Properties Co. v. Lannon
[(1968) 1 WLR 815 : (1968) 1 All ER 354] it was
observed “whether there was a real likelihood of
bias or not has to be ascertained with reference
to rightminded persons; whether they would
consider that there was a real likelihood of bias”.
Almost the same test has also been applied here
in an old decision, namely, in Manak Lal v. Dr
Prem Chand Singhvi [AIR 1957 SC 425 : 1957
SCR 575] . In that case, although the Court
found that the Chairman of the Bar Council
Tribunal appointed by the Chief Justice of the
Rajasthan High Court to enquire into the
misconduct of Manak Lal, an advocate, on the
complaint of one Prem Chand was not biased
22
towards him, it was held that he should not
have presided over the proceedings to give
effect to the salutary principle that justice
should not only be done, it should also be
in view of the fact that the
seen to be done
Chairman, who, undoubtedly, was a Senior
Advocate and an exAdvocate General, had, at
one time, represented Prem Chand in some case.
These principles have had their evolution in the
field of administrative law but the courts
performing judicial functions only cannot be
excepted from the rule of bias as the Presiding
Officers of the court have to hear and decide
contentious issues with an unbiased mind. The
maxim nemo debet esse judex in propria sua
causa and the principle “justice should not only
be done but should manifestly be seen to be
done” can be legitimately invoked in their cases.”
( emphasis supplied )
It is a wellestablished principle, both in our jurisprudence and
39.
across the world, that “ [N]ot only must justice be done; it must also
1
”. In the present circumstances, it may have
be seen to be done
been more apposite for the concerned Judge to have recused from
this case. The appellant should have brought it to the notice of the
learned senior Judge at the very first instance, and not at this
belated stage.
1 R v. Sussex Justices, ex parte McCarthy, 1924 (1) KB 256.
23
40. In the above circumstances, we are of the opinion that the High
Court should not have decided the recall application filed by the
respondents, let alone pass such extensive orders which has the
effect of unsettling proceedings and transactions which have a
history of more than 60 years in a proceeding, basing on an
application filed under Section 151 of the CPC.
41. In view of the above, the appeal is allowed by setting aside the order
dated 21.09.2021 passed in I.A No. 5/2020 in Application No. 837
of 2013 in CS No. 7 of 1958.
............................CJI.
(N. V. RAMANA)
..…..........................J.
(KRISHNA MURARI)
.........…………….......J.
(HIMA KOHLI)
NEW DELHI;
AUGUST 23, 2022.
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