By "fraud" is meant an intention to deceive; whether it is from any expectation of advantage to the party himself or from ill will towards the other is immaterial. The expression "fraud" involves two elements, deceit and injury to the person deceived. Injury is something other than economic loss, that is, deprivation of property, whether movable or immovable or of money and it will include any harm whatever caused to any person in body, mind, reputation or such others. In short, it is a non-economic or non-pecuniary loss. A benefit or advantage to the deceiver, will almost always cause loss or detriment to the deceived. Even in those rare cases where there is a benefit or advantage to the deceiver, but no corresponding loss to the deceived, the second condition is satisfied.

By "fraud" is meant an intention to deceive; whether it is from any expectation of advantage to the party himself or from ill will towards the other is immaterial. The expression "fraud" involves two elements, deceit and injury to the person deceived. Injury is something other than economic loss, that is, deprivation of property, whether movable or immovable or of money and it will include any harm whatever caused to any person in body, mind, reputation or such others. In short, it is a non-economic or non-pecuniary loss. A benefit or advantage to the deceiver, will almost always cause loss or detriment to the deceived. Even in those rare cases where there is a benefit or advantage to the deceiver, but no corresponding loss to the deceived, the second condition is satisfied.

10. A "fraud" is an act of deliberate deception with the design of securing something by taking unfair advantage of another. It is a deception in order to gain by another's loss. It is a cheating intended to get an advantage.

11. "Fraud" as is well known vitiates every solemn act. Fraud and justice never dwell together. Fraud is a conduct either by letters 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 words or letters. It is also well settled that misrepresentation itself amounts to fraud. Indeed, innocent misrepresentation may also give reason to claim relief against fraud. 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. 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. 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.

IN THE SUPREME COURT OF INDIA

Civil Appeal Nos. 6805, 6803-6804 of 2013 and 8627 of 2014

Decided On: 17.04.2017

 Delhi Development Authority and Ors. Vs. Bankmens Co-operative Group Housing Society Ltd. and Ors.

Hon'ble Judges/Coram:

Pinaki Chandra Ghose and Deepak Gupta, JJ.

Citation: (2017) 7 SCC 636

Head Note

Allotment of Land – Possession – Appellant issued provisional Letter of Allotment of land to Society – Though land was allotted yet same was not handed over to Society – Aggrieved by this, Respondent filed Petition before High Court,Petition was disposed of with direction that land be provided to Respondent – Appellant directing that verification of members be undertaken either by Appellant or by Registered Socities and, thereafter, possession of land be handed over to Society as demanded by Appellant -

Court held – revival of Societies is illegal and memberships are not genuine and hence appeals are allowed – there may be some members of Societies who must have been duped by promoters – Court direct Appellant to refund money deposited to Societies along with interest – Societies shall in turn ensure that within given weeks thereafter amount deposited by members is returned to them along with interest said – This will alleviate hardship of genuine members – Accordingly, Appeal filed by appeal are allowed and judgments - orders of High Court are set aside and Petitions are dismissed – Appeal allowed.

(Paras 19, 20)

Cases Referred:
Operative Group Housing Society vs. Registrar, Cooperative Society and Ors.
Bhaurao Dagdu Paralkar v. State of Maharashtra (2005) 7 SCC 605).

Comparative Citations:
2017 AIR(SC) 2011, 2017 (4) Scale 672, 2017 (4) MLJ 308, 2017 (3) AWC 2207, 2017 (7) SCC 636, 2017 (2) BBCJ 500, 2017 (5) RAJ 13,