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The Municipal Borough of Ahmedabad Vs. Vadilal Dalsukhram Shah - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMumbai
Decided On
Case NumberCivil Revision Application No. 263 of 1942
Judge
Reported inAIR1944Bom233(1); (1944)46BOMLR408
AppellantThe Municipal Borough of Ahmedabad
RespondentVadilal Dalsukhram Shah
Excerpt:
.....to law-high court-revision-jurisdiction.; where a municipality refunds, under an order of the court, a sum of money wrongfully recovered from a ratepayer by way of rates, the latter is not entitled, under the interest act, 1839, to claim interest upon the amount for the period during which he was deprived of the use of his money.; in a case which does not fall within the interest act, 1839, interest cannot be allowed by way of damages ; it may be allowed where there is an agreement for the payment of interest, or it is payable by the usage of trade having the force of law.; bengal nagpur ry. co. v. ruttanji ramji (1937) l.r. 65 i.a. 66 : s.c. 40 bom. l.r. 746, followed. ; abdul saffur rowther v. hamida bivi ammal (1919) i.l.r. 42 mad. 661, not good law. - - it is however contended..........23, 1937, when the amount was paid, to april 30, 1940, when the amount was refunded. the learned judge allowed the plaintiff's claim, and the contention of the defendant municipalityis that interest cannot be allowed in law. if i were dealing with the matter free from authority, i should be inclined to say that whenever it is shown that a person has got money in his hands which belongs to somebody else, or when he is bound to pay money to somebody else, and does not do so, he ought to be liable to pay interest by way of damages for non-payment of the money on the due date. however, the matter is not free from authority.4. under the interest act (act xxxii of 1839), which introduced into india the english interest act 31 & 4 will. iv, c. 42, the court can allow interest if the amount.....
Judgment:

John Beaumont, Kt., C.J.

1. This is a revision application against an order of the Small Cause Court Judge of Ahmedabad made under Section 25 of the Provincial Small Cause Courts Act. The ground of the application is that such a claim as this does not lie and, therefore, the learned Judge had no right to pass the order which he did, and such order was not ' according to law ' within Section 25.

2. The suit arose in these circumstances. In the year 1936-37 a bill was issued to the applicant by the Ahmedabad Municipality claiming certain rates, including drainage rate, and a demand was duly made under Section 104 of the Bombay Municipal Boroughs Act, 1925. The applicant appealed against the demand under Section 110, but his appeal was dismissed by the Magistrate. Then he went in revision to the Sessional Court under Section 111, and that application was also dismissed. Then he came in revision to this Court under Section 115 of the Civil Procedure Code, and it has been held that, although the Magistrate and the Sessions Court are exercising criminal jurisdiction, a revision application lies to this Court in a proper case under Section 115. (See Lokmanya Mills Ltd. v. Municipal Borough, Barsi : (1939)41BOMLR937 . Why the provisions of Section 115 were held to apply in this case, I do not know. It looks rather as if the only point at issue was one of law, and therefore of appeal and not revision. However, the matter was entertained in this Court, and the learned Judge on January 17, 1940, held that the levy of a drainage tax was illegal, and directed refund of the amount paid in respect of that tax, the amount having been paid by the applicant on January 23, 1937, under protest.

3. In this suit the applicant claims from the Municipality in the Court of Small Causes interest on the amount of drainage tax which has been refunded, interest that is for the period from January 23, 1937, when the amount was paid, to April 30, 1940, when the amount was refunded. The learned Judge allowed the plaintiff's claim, and the contention of the defendant Municipalityis that interest cannot be allowed in law. If I were dealing with the matter free from authority, I should be inclined to say that whenever it is shown that a person has got money in his hands which belongs to somebody else, or when he is bound to pay money to somebody else, and does not do so, he ought to be liable to pay interest by way of damages for non-payment of the money on the due date. However, the matter is not free from authority.

4. Under the Interest Act (Act XXXII of 1839), which introduced into India the English Interest Act 31 & 4 Will. IV, c. 42, the Court can allow interest if the amount claimed is a sum certain which is payable at a certain time by virtue of a written instrument. But it is clear that the terms of that Act do not apply to the present case. This Court having made no order for payment of interest, there is no written instrument under which interest is payable. It is however contended that interest can be claimed on the principle of justice, equity and good conscience, as was suggested by the High Court of Madras in Abdul Saffur Rowther v. Hamida Bivi Ammal I.L.R. (1919) Mad.661. But it seems to me that the recent decision of the Privy Council in Bengal Nagpur Ry. Co. v. Ruttanji Ramji (1937) L.R.65 IndAp66 is opposed to that view. The Court there held that in a case which does not fall within the Interest Act, interest cannot be allowed by way of damages ; it may be allowed where there is an agreement for the payment of interest, or it is payable by the usage of trade having the force of law. But there is nothing of that sort in this case. The law has been altered in England by Section 3 of the Law Reform (Miscellaneous Provisions) Act, 1934, but that alteration of the law has not been introduced into British India, and in the circumstances it seems to me that the Court has no power to allow interest in a case of this sort.

5. Mr. Patel for the opponent suggests that he is really suing in tort. His position would not be improved by suing in tort, and in any case there was no tortious act on the part of the Municipality. They claimed a sum to which they thought they were entitled. Moreover if the liability was in tort, it is plain that the cause of action arose when the wrongful demand was made, and the delay in filing the suit is much more than the six months allowed under Section 206 of the Bombay Municipal Boroughs Act for the filing of a suit. Indeed I think that, even if interest could be allowed under the law, Section 206 would be an answer, on whatever basis the plaintiff puts his case.

6. However, in my opinion, on the authorities, in a case of this sort the plaintiff is not entitled to recover interest, and, therefore, I think the learned Judge's order was not according to law within the meaning of Section 25 of the Provincial Small Cause Courts Act, and I must set the order aside, with costs throughout.


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