Suppression of material documents can justify recall of an order and modification of interest under inherent court powers.

Suppression of material documents showing withdrawal of the contractor's interest condition justified recall or modification of the earlier order, because deliberate nondisclosure of a relevant fact amounts to fraud on the Court. The Delhi HC held that its inherent power under Section 151 CPC could be invoked to correct an order obtained by suppression and misrepresentation, and the plea of functus officio did not prevent such correction. On that basis, the Court modified the award of interest and costs and held the contractor not entitled to interest for the relevant period.

---

---

Issues: Whether the earlier judgment deserved recall or modification on the ground that material documents showing withdrawal of the contractor's condition had been suppressed, and whether interest payable under the award should be denied or reduced accordingly.

Analysis: The original record showed that the contractor had initially inserted a handwritten condition for monthly payment with 24% interest for delay, but contemporaneous documents, including the negotiation letter and office noting, recorded withdrawal of that condition before award of the contract. Those documents were material to the dispute and were not placed before the arbitral tribunal or the Court when the earlier judgment was decided. Suppression of a material fact or document, whether by active misstatement or deliberate silence, amounts to fraud on the Court. In such a situation, the Court's inherent power under Section 151 of the Code of Civil Procedure could be invoked to recall or modify its order, and the plea of functus officio could not defeat correction of an order obtained by suppression and misrepresentation.

Conclusion: The application was allowed in part. The earlier understanding regarding the contractor's interest condition was corrected, the award of interest and costs was modified, and the contractor was held not entitled to interest for the relevant period.

---