Ex-gratia relief obtained through fraud is recoverable.

The petitioner sought to quash communications directing recovery of ₹6 lakh in ex-gratia relief paid to him in 1997 for the alleged deaths of six family members in 1993, and to prevent further recovery.

The respondents alleged that the family members had migrated to PoK and that the relief had been fraudulently obtained; they relied on an inquiry and records concerning the petitioner’s application and the sanction of relief.

The petitioner disputed fraud and contended that he had not received a hearing before recovery was ordered.

He also challenged the reliability of the allegation that his family members were alive in PoK.

1. Whether the respondents’ direction to recover the ₹6 lakh ex-gratia payment was liable to be quashed, given the petitioner’s challenge to the finding that the relief had been fraudulently obtained.

2. Whether recovery was initiated in breach of natural justice because the petitioner was not afforded an opportunity of hearing.

The Court applied the principle that fraud vitiates proceedings and that a person cannot retain a benefit procured by fraud; it relied on Vishnu Vardhan v. State of U.P., 2025 SCC OnLine SC 1501, which discussed Nidhi Kaim v. State of Madhya Pradesh, S.P. Chengalvaraya Naidu v. Jagannath, and Lazarus Estates Ltd. v. Beasley.

The Court also treated the opportunity-of-hearing question as one to be assessed against the respondents’ account that notice was issued, the petitioner appeared, and statements were recorded; in the absence of a rebuttal, it found no violation of natural justice.

No specific statutory provision was identified as the basis for the Court’s decision.

The Court found material inconsistencies in the petitioner’s account, including the timing and nature of the alleged incident, the date and character of the police record, and the delay of four years before the report was entered and death certificates issued.

It also noted that no bodies had been recovered or handed over, and that the petitioner had not explained why relief was paid to him alone despite a report referring to a surviving sister.

On the record, the Court concluded that the relief had been procured in collusion with police and revenue officials and that allowing the petitioner to retain it would result in unjust enrichment.

As to natural justice, the respondents’ assertion that the petitioner had received notice and participated in the inquiry was not rebutted; the Court therefore rejected that ground.

It found that the ex-gratia relief had been fraudulently obtained and that the petitioner had not established a breach of natural justice.