M/S SCIEMED OVERSEAS INC. vs. BOC INDIA LIMITED .

REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION PETITION FOR SPECIAL LEAVE TO APPEAL (C) NO. 29125 OF 2008 M/s Sciemed Overseas Inc. ….Petitioner Versus BOC India Limited & Ors. …Respondents J U D G M E N T Madan B. Lokur, J. 1. The only question for our consideration is whether the High Court was correct in imposing costs of Rs. 10 lakhs on the petitioner for filing a false or misleading affidavit in this Court. In our opinion, the imposition of costs, although JUDGMENT somewhat steep, was fully justified given that the High Court also held that the contract in favour of the petitioner was awarded improperly and was of a commercial nature, the last two findings not being under challenge. 2. A global search of cases pertaining to the filing of a false affidavit indicates that the number of such cases that are reported has shown an alarming increase in the last fifteen years as compared to the number of such cases prior to that. This ' is illustrative of the malaise that is slowly but surely creeping in. This ‘trend’ is SLP (C) No. 29125 of 2008 Page of 1 13 Page 1 certainly an unhealthy one that should be strongly discouraged, well before the filing of false affidavits gets to be treated as a routine and normal affair. nd 3. The petitioner is aggrieved by a judgment and order dated 22 September,

1 212 of 2008 only to the extent of imposition of costs. In our opinion, there is no merit in this petition and it deserves to be dismissed. 4. The Rajendra Institute of Medical Sciences, Ranchi, (for short “the RIMS”) th issued a notice inviting tender on 10 February, 2007. The tender was for installation and supply of a complete system of Centralized Liquid Medical Oxygen with medical gas pipe line for Oxygen, Carbon Dioxide, Nitrous Oxide and compressed air, etc. The work was to be executed on a turnkey basis within 150 days in the 1000 bedded departments and wards of the RIMS. 5. Responses to the notice inviting tender were submitted by the petitioner JUDGMENT (Sciemed Overseas) and respondent No.1 (BOC India). Their tenders were th processed by the RIMS and a memorandum dated 25 June, 2007 was issued by its Director informing Sciemed and BOC regarding opening of the price bid of commercially and technically successful bidders. 6. According to BOC, the conditions of the technical bid were not fulfilled by Sciemed and, therefore, there was no reason to invite it for opening the price bid. 1 BOC India Limited v. State of Jharkhand, MANU/JH/0938/2008 SLP (C) No. 29125 of 2008 Page of 2 13 Page 2 A representation was made in this regard by BOC to the RIMS but that was not considered and, therefore, BOC filed W.P.(C) No. 4203 of 2007 in the High Court of Jharkhand in respect of its grievance against Sciemed and the RIMS.

st dated 31 July, 2007 the writ petition was disposed of giving liberty to BOC to file another representation in continuation of its earlier representation to the RIMS. It was directed that both the representations should be considered by the Director of the RIMS and an appropriate reasoned order be passed thereon. 8. It is important to note that when the aforesaid writ petition was disposed of st on 31 July, 2007 no intimation was given to the High Court by the RIMS or by th Sciemed to the effect that about a week earlier, that is, on 25 July, 2007 a work order had already been issued to Sciemed in respect of the notice inviting tender. 9. This fact was first brought to the notice of BOC when the Director of the JUDGMENT th RIMS in his letter dated 8 September, 2007 informed BOC, in response to the th representations, that the work order had already been issued to Sciemed on 25 July, 2007. 10. Under these circumstances, BOC preferred yet another petition being W.P. (C) No. 4830 of 2007 challenging the issuance of the work order in favour of Sciemed. th 11. By an order dated 10 September, 2007 the High Court dismissed the second SLP (C) No. 29125 of 2008 Page of 3 13 Page 3 writ petition filed by BOC holding that the question whether the work order had or had not been issued to Sciemed was a question of fact. That apart, BOC had also raised several other questions of fact. The High Court was of the opinion that since

there was no reason to entertain the writ petition and it was, accordingly, dismissed. 12. Feeling aggrieved, BOC preferred L.P.A. No. 319 of 2007 which was heard th and dismissed by a Division Bench of the High Court on 10 October, 2007 thereby upholding the view taken by the learned Single Judge that the second writ petition filed by BOC raised disputed questions of fact. 13. Feeling dissatisfied with the order passed by the Division Bench, BOC preferred a petition for Special Leave to Appeal to this Court in which leave was th granted on 14 March, 2008. This Court disposed of the appeal being Civil Appeal JUDGMENT No.2028 of 2008 on that day itself holding that there is hardly any disputed question of fact. On the contrary, the facts of the case were evident from the documents already on record and oral evidence was required to be led. Accordingly, this Court was of the view that the matter ought to be heard on merits by the High Court and an appropriate direction was given in this regard. th 14. During the pendency of the Civil Appeal, an affidavit was filed on 20 February, 2008 by Sciemed through its proprietor Shailendra Prasad Singh in SLP (C) No. 29125 of 2008 Page of 4 13 Page 4 which it was stated as follows:-

15. It is this passage in the affidavit that has given rise to the controversy before us. 16. Pursuant to the order passed by this Court, the writ petition filed by BOC was taken up for consideration by a learned Single Judge of the High Court. By an th order dated 14 May, 2008, the learned Single Judge dismissed the writ petition. While disposing of the writ petition, it was held that though the decision making process by which Sciemed was declared to be qualified was improper, it could not be held that the RIMS had acted in an arbitrary, mala fide or discriminatory manner. The learned Single Judge noted that Sciemed had stated before this Court JUDGMENT that the work was almost complete. The High Court observed that since the work awarded to Sciemed had progressed to a considerable extent and a major portion of money had been advanced or paid to Sciemed, therefore if the work order were to be set aside it would involve dismantling and uprooting the system that had so far been fixed which would not be in the interest of the patients or the exchequer. Accordingly, the learned Single Judge declined to interfere with the award of the SLP (C) No. 29125 of 2008 Page of 5 13 Page 5 contract to Sciemed but left it open to BOC to file a suit for damages against Sciemed. 17. Feeling aggrieved, Sciemed preferred a Letters Patent Appeal before the

nd judgment and order dated 22 September, 2008. While doing so, the Division Bench of the High Court noted that the reason why the learned Single Judge did not interfere with the award of the contract to Sciemed was because of its statement made before this Court on affidavit that the work was almost near completion. It was also noted that cancellation of the award of contract at his stage would entail a heavy administrative and financial burden on the Government and lead to increase and double expenditure to the tune of crores of rupees. 18. However, the High Court, on the submission of learned counsel for BOC decided to verify whether the installation and supply of the complete system as per JUDGMENT the notice of tender was near completion as stated by Sciemed in its affidavit filed in this Court. For this purpose, the High Court appointed a respected advocate of that Court as a one-man committee to visit the work site and submit a report with regard to the extent of work completed or at the stage of completion. 19. The learned advocate so appointed by the High Court submitted his Report rd on 3 July, 2008. It was stated in the Report, which was accepted by the High Court, that the originating point/inlet of the main Liquid Oxygen Gas Tank of the SLP (C) No. 29125 of 2008 Page of 6 13 Page 6 required specification had not yet been installed. It was also found that a separate 3-Phase Electric Supply System for commissioning the project had not yet been installed. In view of these two major deficiencies, the commissioning of the

Gas Tank was in transit from Bangalore at that time. 20. On a consideration of the Report, the High Court took the view that Sciemed had given a false affidavit in this Court to the effect that the work was near completion. In this view of the matter, the High Court dismissed the appeal filed by Sciemed and imposed costs of Rs. 10 lakhs to be deposited with the Jharkhand State Legal Services Authority. 21. At this stage, it is important to mention that Sciemed through its proprietor Shailendra Prasad Singh son of Rameshwar Prasad Singh, had filed an affidavit on th or about 10 July, 2008 in the High Court in which it was explained that the JUDGMENT statement made in this Court on affidavit was because the deponent was of the view that the installation of the complete system of gas pipeline is one part of the award and installation of liquid oxygen tank is a separate work. It was stated that the affidavit filed in this Court was due to some misconception and was not with a view to mislead this Court. In other words, the deponent sought to justify his affidavit in this Court notwithstanding the Report of the learned advocate. The deponent after giving the above explanation, tendered an unconditional and SLP (C) No. 29125 of 2008 Page of 7 13 Page 7 unqualified apology to the High Court for the statement regarding the near completion of the project. 22. The High Court did not accept the apology given by the proprietor of

23. While impugning the order passed by the High Court, it was submitted by the learned counsel for Sciemed that in fact the statement made in the affidavit filed in this Court was not a false statement but was bona fide and not a deliberate attempt to mislead this Court. It was also submitted that the allegedly false or misleading statement had no impact on the decision taken by this Court and should, therefore, be ignored. 24. We are unable to accept either contention raised by learned counsel. 25. The correctness of the statement made by Sciemed was examined threadbare not only by the learned Single Judge but also by the Division Bench and JUDGMENT it was found that a considerable amount of work had still to be completed by Sciemed and it was not as if the work was nearing completion as represented to this Court. Additionally, the Report independently given by the learned advocate appointed to make an assessment, also clearly indicated that a considerable amount of work had still to be performed by Sciemed. The Report was not ex parte but was carefully prepared after an inspection of the site and discussing the matter with Shailendra Prasad Singh the proprietor of Sciemed and an engineer of Sciemed as SLP (C) No. 29125 of 2008 Page of 8 13 Page 8 well as officers from the RIMS. 26. The conclusion drawn by the learned advocate after a thorough inspection and discussion of the issues is as follows:-

It appears that on account of delay in installation of the Main Liquid Oxygen Tank and the 3 Phase electrical connection, the commissioning of the complete system of Liquid Medical Oxygen Gas together with other gases. Vacuum and Air are being delayed. The entire outlet system upto the individual outlets have been put in place as already stated above. I also noticed that at the point of the final outlets at the end of the Branch pipeline at the Bed heads wherever they are specified by the Work Order, the double lockout with parking facility has been installed but the electrical switches for which space is left in the panel has not yet been fixed.” JUDGMENT 27. After the Report was filed in the High Court, Sciemed also realized that it had in fact misled this Court. Nevertheless, Sciemed tried to justify the false or misleading affidavit filed in this Court. After giving the justification, Sciemed tendered an unconditional and unqualified apology through Shailendra Prasad SLP (C) No. 29125 of 2008 Page of 9 13 Page 9 Singh, proprietor of Sciemed. There was no need for the proprietor to have tendered an unconditional and unqualified apology unless there was an admission that the statement made before this Court was false or misleading. It would have

apology without tendering a justification. 28. As far as the alternative submission of the learned counsel is concerned, we are not in a position to accept this submission also particularly if the entire matter is looked at in a broad conspectus. th 29. In the first instance, the work order was issued to Sciemed on 25 July, 2007 but this was not disclosed to the High Court when it disposed of W.P.(C) No.4203 st of 2007 on 31 July, 2007. Had the factual position been disclosed to the High Court, perhaps the outcome of the writ petition filed by BOC would have been different and the issue might not have even travelled up to this Court. JUDGMENT Furthermore, apparently to ensure that work order goes through, a false or misleading statement was made before this Court on affidavit when the matter was th taken up on 14 March, 2008 to the effect that the work was nearing completion. It is not possible to accept the view canvassed by learned counsel that the false or th misleading statement had no impact on the decision rendered by this Court on 14 March, 2008. We cannot hypothesize on what transpired in the proceedings before this Court nor can we imagine what could or could not have weighed with this SLP (C) No. 29125 of 2008 Page of 10 13 Page 10 th Court when it rendered its decision on 14 March, 2008. The fact of the matter is that a false or misleading statement was made before this Court and that by itself is enough to invite an adverse reaction.

Court had observed that the sanctity of affidavits filed by parties has to be preserved and protected and at the same time the filing of irresponsible statements without any regard to accuracy has to be discouraged. It was observed by this Court as follows: “Courts are entrusted with the powers of dispensation and adjudication of justice of the rival claims of the parties besides determining the criminal liability of the offenders for offences committed against the society. The courts are further expected to do justice quickly and impartially not being biased by any extraneous considerations. Justice dispensation system would be wrecked if statutory restrictions are not imposed upon the litigants, who attempt to mislead the court by filing and relying upon false evidence particularly in cases, the adjudication of which is dependent upon the statement of facts. If the result of the proceedings are to be respected, these issues before the courts must be resolved to the extent possible in accordance with the truth. The purity of proceedings of the court cannot be permitted to be sullied by a party on frivolous, vexatious or insufficient grounds or relying upon false evidence inspired by extraneous considerations or revengeful desire to harass or spite his opponent. Sanctity of the affidavits has to be preserved and protected discouraging the filing of irresponsible statements, without any regard to accuracy.” JUDGMENT 3 31. Similarly, in Muthu Karuppan v. Parithi Ilamvazhuthi this Court expressed the view that the filing of a false affidavit should be effectively curbed 2 (2001) 5 SCC 289 3 (2011) 5 SCC 496 SLP (C) No. 29125 of 2008 Page of 11 13 Page 11 with a strong hand. It is true that the observation was made in the context of contempt of Court proceedings, but the view expressed must be generally endorsed to preserve the purity of judicial proceedings. This is what was said:

32. On the material before us and the material considered by the High Court, we are satisfied that the imposition of costs by the High Court was justified. We find no reason to interfere with the impugned judgment and order. The petition is dismissed. 33. However, we grant six weeks to the petitioner to make the deposit of costs as directed by the High Court with the Jharkhand Legal Services Authority (JHALSA). On the deposit being made, the JHALSA should forward the amount to JUDGMENT BOC India. The matter should be listed in the High Court after eight weeks for compliance. .....…………………….J (Madan B. Lokur) ..... …………………….J (R.K. Agrawal) SLP (C) No. 29125 of 2008 Page of 12 13 Page 12 New Delhi; January 11, 2016 JUDGMENT SLP (C) No. 29125 of 2008 Page of 13 13 Page 13