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Ammanibai Vs. Anant Narayan Shanbhog - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMumbai
Decided On
Reported inAIR1931Bom365
AppellantAmmanibai
RespondentAnant Narayan Shanbhog
Excerpt:
.....293, 295a of i.p.c., - , was of opinion that if a person with whom money had been kept for payment to a third person, does not act up to the agreement, he is liable for damages as for breach of contract to the extent of the loss which the person depositing the money has suffered by reason of such failure or delay, and that article 83, lim. , the date when either there was a repudiation of the liability under it, or when the contract had become impossible of performance on account of the vendor's debt having been satisfied. the learned subordinate judge is not satisfied that the date mentioned referred to the payment to kencha or whether it referred to the deposit with the purchaser......effect of article 116 read with article 83, lim. act, gave the period of six years for the suit, time running from the date when the plaintiffs were actually damnified. to the same effect is the decision in kumar nath bhuttacharjee v. nobo kumar bhuttacharjee [1896] 26 cal. 241. the patna high court in ram rachhya singh thakur v. raghunath prasad misser : air1930pat46 , held that in a suit to recover the amount of the unpaid purchase money from the defendant which he had agreed to pay to a third person, the suit was governed by article 116, lim. act, and terminus a quo was not the date of the execution of the sale deed but the date on which the contract was deemed to have been broken, viz., the date when either there was a repudiation of the liability under it, or when the.....
Judgment:

Patkar, J.

1. This was a suit brought by the plaintiff to recover Rs. 300 on the ground that the money was recovered from her in execution by her husband's creditor in contravention of the agreement made by defendant 1 with the plaintiff's husband.

2. The plaintiff's husband had passed a promissory note on 30th July 1910, in favor of one Kencha. On 14th August 1912 he sold his property to defendant 1 who agreed to pay Rs. 121-10-4 due to Kencha, the creditor of the vendor, Defendant 1 did not pay the amount as agreed and Kencha sued the plaintiff's husband and defendant 1 on the promissory note and obtained a decree against the plaintiff's husband in January 1916. The present suit was brought by the plaintiff on 22nd August 1924. The amount was recovered by Kencha from the plaintiff in execution of his decree on 31st August 1921. The point arising in the case is whether the plaintiff's suit is barred by limitation. The learned Subordinate Judge held that the suit was within time. The learned District Judge came to the contrary conclusion.

3. It is urged on behalf of the appellant that the plaintiff's suit is to recover the unpaid purchase money as a charge on. The property and to recover it by sale, and therefore Article 132, Lira. Act, applies. The vendor has a charge Under Section 55, Sub-section 4(b), T.P. Act, and this charge is not lost by a direction to the vendee to pay the debt. In Sivasubramania Ayyar v. Subramania Ayyar [19l6] 39 Mad. 997 it was held that a contract to forego the vendor's charge for unpaid purchase money is not to be necessarily inferred when the whole or part of the consideration of the purchase of immovable property is to be paid by the purchaser to a third party on behalf of the vendor. The question however arises when the cause of action for the purposes of Article 132 arose. The saledeed was passed and the sale was complete on 14th August 1912, and under Article 132 limitation would begin to run from the date of the sale dead. Under Article 111, Lim. Act, for a suit by a vendor of immovable property for personal payment of unpaid purchase money, the time begins to run from the time fixed for completing the sale. I think therefore that, if Article 132 were held applicable to the present suit, the claim would be barred by limitation as the suit is not brought within twelve years from the date of the saledeed.

4. It is urged on behalf of the appellant that by the combined operation of Articles 83 and 116 and Section 24, Lim. Act, the plaintiffs suit is within time. The learned District Judge has principally relied on the case of Raghubar Rai v. Jaij Raj [1912] 34 All. 429, where it was held that in a suit by the vendors for compensation for breach of the contract to pay the amount to a third person, it was not necessary that the vendors should have suffered any loss before they could bring the suit, and that as no time was specified in the sale deed for payment of the amount, limitation ran from the date of the execution of the deed. The judgment is based principally on the decision in Buttley v. Faulkner [1820] 3 B. & Ald. 288, and dissented from the view in Kumar Nath Bhuttacharjee v. Nobo Kumar Bhuttacharjee [1896] 26 Cal. 241, where it was held that no authority has been shown to the effect that a suit could not be brought for damages subsequent to the injury sustained. The basis for the decision is that the plaintiff may bring an action even before sustaining damages on the ground that the person making the covenant may place him in a position to meet the liability he has taken on the latter's behalf. In Raghubar Rai v. Jaij Rai (at p. 432) the point as to whether a suit for actual damages sustained by the vendor owing to subsequent recovery of the debt could be maintained was not considered, but the reasoning underlying the judgment appears to be against the maintainability of such a suit. The decision in the case of Kedar Nath v. Har Govind : AIR1926All605 has shaken the authority of Raghubar Rai's case [1912] 34 All. 429. Kanhaiya Lal, J., was of opinion that if a person with whom money had been kept for payment to a third person, does not act up to the agreement, he is liable for damages as for breach of contract to the extent of the loss which the person depositing the money has suffered by reason of such failure or delay, and that Article 83, Lim. Act, would be applicable on the ground of implied agreement to indemnify, and the suit, if brought within three years from the date of the payment, would be within time. Ashworth, J., on the other hand, was of opinion that neither Article 61 nor Article 83 was applicable, and held that Article 116, Lim. Act, read with Section 24 of the said Act would bring the suit within time. With regard to the decision in Raghubar Rai's case [1912] 34 All. 429, it is held by Ash worth, J., that the authorities cited in that case are not applicable to contracts in India, and that a reference to the terms of Section 73, Contract Act shows that a suit can only be brought for injury or loss already caused and not for prospective loss. In Ram Ratan Lal v. Abdul Wahid Khan A.I.R. 1926 All. 435 the authority of Raghubar Rai's case [1912] 34 All. 429 was doubted, and it was held that there was a healthy and consistent current of authority in recent years that the statute runs from the time when the loss was incurred, or, in other words, when the payment was made. It appears therefore that the case of Raghubar Rai v. Jaij Raj [1912] 34 All. 429 has not been followed in the subsequent decisions of the Allahabad High Court.

5. The Lahore High Court in Abdul Aziz Khan v. Muhammad Bakhsh A.I.R. 1921 Lah. 260 held that the combined effect of Article 116 read with Article 83, Lim. Act, gave the period of six years for the suit, time running from the date when the plaintiffs were actually damnified. To the same effect is the decision in Kumar Nath Bhuttacharjee v. Nobo Kumar Bhuttacharjee [1896] 26 Cal. 241. The Patna High Court in Ram Rachhya Singh Thakur v. Raghunath Prasad Misser : AIR1930Pat46 , held that in a suit to recover the amount of the unpaid purchase money from the defendant which he had agreed to pay to a third person, the suit was governed by Article 116, Lim. Act, and terminus a quo was not the date of the execution of the sale deed but the date on which the contract was deemed to have been broken, viz., the date when either there was a repudiation of the liability under it, or when the contract had become impossible of performance on account of the vendor's debt having been satisfied.

6. It appears therefore that the trend of the recent decisions has been opposed to the ruling in Raghubar Rai's case [1912] 34 All. 429. It is urged on behalf of the respondent that these rulings ought to be distinguished from the present case on the ground that there was a specific date mentioned for payment of the money to Kencha, and that was the date of the execution of the deed. The learned Subordinate Judge is not satisfied that the date mentioned referred to the payment to Kencha or whether it referred to the deposit with the purchaser. This point was not taken in the lower appellate Court, and the only question argued was that a suit to recover damages must be brought within six years from the date of the sale deed irrespective of the question whether the loss had occurred or not. I think, having regard to the recent decisions to which I have referred, that this view is not sustainable. I am inclined to hold that the cause of action would arise on the date when the plaintiff suffered the loss, and that under Article 116, the time would begin to run when the agreement of the defendant became impossible of performance by reason of the payment made by the plaintiff according to the ruling in Ram Rachhya Singh Thakur v. Raghunath Prasad Misser : AIR1930Pat46 .

7. I think therefore that the suit is within time and the view of the Subordinate Judge is right and the view taken by the lower appellate Court, in my opinion, is incorrect.

8. I would therefore reverse the decree of the lower appellate Court and restore that of the Subordinate Judge with costs throughout on the respondent.


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