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Union of India (Uoi) and anr. Vs. Hem Chandra and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty;Civil
CourtAllahabad High Court
Decided On
Case NumberSecond Appeal No. 1110 of 1962
Judge
Reported inAIR1970All228
ActsAdministration of Evacuee Property Act, 1950 - Sections 4, 17, 28, 40 and 46; Administration of Evacuee Property (Central) Rules, 1950 - Rule 22; Limitation Act, 1908 - Sections 9 - Schedule - Articles 97, 116 and 120
AppellantUnion of India (Uoi) and anr.
RespondentHem Chandra and ors.
Appellant AdvocateN.D. Pant, Adv.
Respondent AdvocateL.M. Pant, Adv.
DispositionAppeal dismissed
Excerpt:
property - claim on evacuee property - sections 4, 17, 28, 40 and 46 of administration of evacuee property, 1950, rule 22 of administration of evacuee property (central) rules, 1950 and articles 97, 116 and 120 of limitation act, 1908 - property purchased declared as evacuee property - application for sale confirmation dismissed - application for registration also dismissed - suit for refund of sale consideration filed in civil court - where transaction of transfer is done in good faith, claim is not required to be established at civil court - preference to be given to interpretation which does not bar a suit over one that bars in interest of justice - once period of limitation starts to run, it cannot be stopped. - - the trial court came to the conclusion that the civil court had..........and shall not be called in question in any court by way of appeal or revision or in any original suit, application or execution proceedings.'the suit giving rise to the present appeal has not been filed to challenge any order of the custodian: rather the suit has been filed in obedience to the order of the custodian. thus, section 28 of the act also has no application to the facts of the present case.11. next sri pant relied upon sections 17 of the act. it reads thus:--'17(1): save as otherwise expressly provided in this act, no evacuee property which has vested or is deemed to have vested in the custodian under the provisions of this act shall, so long as it remains so vested, be liable to be proceeded against in any manner whatsoever in execution of any decree or order of any court.....
Judgment:

R.B. Misra, J.

1. This is a defendant's appeal against the judgment and decree of the District Judge Budaun, dated 7th December, 1961. The facts in this case are not in dispute and, succinctly put, are as follows.

2. Smt. Umatul Khatun, wife of Moulvi Tawakkul Husain, was the owner in possession of house No. N-7/6, situate in Mohalla Sheikh Patti. She sold this house to Hem Chand respondent No. 1 (since dead and represented by his heirs) and Tribhuwan Nath respondent No. 2 for a sum of Rs. 1,500 under a registered gale deed dated 25th May, 1951. The two respondents paid the full price to the vendor. On llth August, 1951 the Assistant Custodian, Evacuee Property, Budaun declared the house as evacuee property. The respondents, as required by the statute, applied for confirmation of the sale under Section 40 of the Administration of Evacuee Property Act (hereinafter referred to as the Act). Their application was, however, dismissed on 19th October, 1951. The appeal and thereafter revision preferred against the order of dismissal of the application under Section 40 also met the same fate. The respondents, therefore, applied under Rule 22 of the Administration of Evacuee Property (Central) Rules, 1950 (hereinafter referred to as the Rules). That application was also rejected, and the respondents were directed to go to the Civil Court. The respondents accordingly, after giving notice under Section 80, C. P. C., filed the suit giving rise to the present appeal for the recovery of Rs. 2075-42 together with interest and costs from the appellant.

3. The suit was contested by the appellant on the grounds that it was barred by time; that the jurisdiction of Civil Court was barred by Section 46 of Act 31 of 1950; and that the transaction. Was not a bona fide one.

4. The pleadings of the parties gave rise to a number of issues, the main being the issues of jurisdiction and of limitation. The trial Court came to the conclusion that the Civil Court had jurisdiction to try the suit, and that the suit was well within time. It also accepted the finding of the Custodian that there was no mala fides on the part of the respondents who paid the sale consideration under the bona fide belief that they would get possession of the house and they had no apprehension that such an old lady aged about 92 years would migrate to Pakistan so soon after the sale. The trial Court held that the conditions required under Rule 22 of the Administration of Evacuee Property Rules were fulfiled in the present case. On these findings the trial Court decreed the suit for Rupees 1,501-52 P.

5. The defendants went up in appeal, and the learned Judge confirmed the findings of the trial Court on the issues of jurisdiction and of limitation. The finding about the bona fide transaction on the part of the respondents does not appear to have been challenged before the lower appellate Court, and therefore, the finding of the trial Court on that issue would also be deemed to have been confirmed by the lower appellate Court. The defendants have now come to this Court in Second Appeal.

6. On the findings recorded by the trial Court, as confirmed by the lower appellate Court, only two points survive for decision in this appeal. The question of bona fides on the part of the respondents is now concluded as finding of fact.

7. Sri N.D. Pant, counsel for the appellants, first took up the issue of jurisdiction. He relied upon Section 46(d) of the Act. Section 46 reads thus:--

'Save as otherwise expressly provided in this Act, no civil or revenue Court shall have jurisdiction:

(a) to entertain or adjudicate upon any question whether any property or any right to or interest in any property is or is not evacuee property; or

(b) (Omitted).

(c) to question the legality of any action taken by the Custodian-General or the Custodian under this Act; or

(d) in respect of any matter which the Custodian-General or the Custodian is empowered by or under this Act to determine.'

Sri Pant admits that it is only Clause (d) of Section 46 which can apply to the facts of the present case. Clauses (a) and (c) have no application. In my opinion. Section 46(d) of the Act does not stand as a bar to the civil suit. The respondents, asindicated earlier, first applied for confirmation of the sale under Section 40 of the Act; but that was rejected. Thereafter they applied under Rule 22 of the Rules. Rule 22 so far as it is pertinent to our case reads-

'22(1). Any person claiming the right to receive any payment from any evacuee or from the property of such evacuee whether in re-payment of any loan advanced or otherwise, may present petition to the Custodian for registration of his claim. Such application shall be signed and verified by the claimant in the same manner as a plaint is required to be signed and verified under the Code of Civil Procedure, 1908.

Explanation:-- An application under this sub-rule shall lie in respect of a claim for refund of money paid as consideration for the transfer by an evacuee of any property, where such transfer is not confirmed by the Custodian under Section 40 of the Act.

(2) (a) Where a claim made under sub-rule (1) is supported by-

(i) ........................

(ii) ........................

(iii) ........................

(iv) .......................; or

(b) where such claim is of the nature referred to in the 'Explanation' to Sub-rule (l) and the Custodian holds that the transfer of the property in respect of which the claim is made was a bona fide transaction, the Custodian may register the claim or such part thereof as has not been satisfied:

Provided that in the case of a claim of the nature referred to in the Explanation to Sub-rule (1), the claim shall be registered only for that amount of money which is proved to have been paid as consideration for the transfer of the property. (2-A) In any case which does not fall under Sub-rule (2), the Custodian shall direct the claimant to establish his claim in a Civil Court.

(3) ........................

(4) ........................

Explanation-- Nothing in this rule shall debar the Custodian from meeting the day to day expenses incurred in the management of evacuee property and such expenses may be paid without sanction. Sanction of the Central Government or the Custodian-General is also not required to the discharge by the Custodian of the legitimate obligations and liabilities incurred in the oridinary course of business of a trading concern carried on by the Custodian whether such liabilities and obligations are incurred before or after the vesting of the business in the Custodian.'

8. The aforesaid rule makes It evident that it was open to the respondents to apply for registration, of their claim, andthe respondents did so apply. The Custodian could register the claim on being satisfied with the conditions contemplated by Rule 22 (2) (b), viz.. that the transfer of the property in respect of which the claim was made was a bona fide transaction. Sub-rule (2-A) of Rule 22 provides for a situation where the transaction was not found by the Custodian to be a bona fide one. In such a situation the Custodian 'shall' direct the claimant to establish his claim in a Civil Court, and actually the Custodian did direct the respondents in this case to Set their claim established in a Civil Court. It was under these circumstances that the respondents had to file the suit giving rise to this appeal.

9. In view of Rule 22. Section 46(d) cannot possibly stand as a bar to the suit Section 46 has to be read along with Rule 22. The Rule itself provides that in case a transaction of transfer was not found to be bona fide the Custodian 'shall' direct the claimant to get his claim established in a Civil Court. The filing of such a suit for establishing the claim is clearly contemplated by the Rules framed under the Administration of Evacuee Property Act.

10. Sri Pant next referred to Sections 4 and 28 of the Act. Although from the lower Court's judgment it appears that these sections were never referred to before the Court below, I permitted Sri Pant to refer to them as on the admitted facts of the case it was a pure question of law. Section 4 provides:--

'The provisions of this Act and of the rules and order made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any such law.'

This section only contemplates that this Act and the rules framed thereunder override other laws. We have, therefore, to examine whether there is any rule or law in the Act or the Rules framed thereunder barring the jurisdiction of the Civil Court. If there is such a provision, the jurisdiction of the Civil Court would be barred; otherwise Civil Court will have jurisdiction. But it has already been noticed earlier that Rule 22 instead of creating any bar provides for such a suit.

Section 28 of the Act reads:--

'Save as otherwise expressly provided in this Chapter, every order made by the Custodian-General, District Judge, Custodian, Additional Custodian, Authorised Deputy Custodian, Deputy Custodian or Assistant Custodian shall be final and shall not be called in question in any Court by way of appeal or revision or in any original suit, application or execution proceedings.'

The suit giving rise to the present appeal has not been filed to challenge any order of the Custodian: rather the suit has been filed in obedience to the order of the Custodian. Thus, Section 28 of the Act also has no application to the facts of the present case.

11. Next Sri Pant relied upon Sections 17 of the Act. It reads thus:--

'17(1): Save as otherwise expressly provided in this Act, no evacuee property which has vested or is deemed to have vested in the Custodian under the provisions of this Act shall, so long as it remains so vested, be liable to be proceeded against in any manner whatsoever in execution of any decree or order of any Court or other authority, and any attachment or injunction or order for the appointment of a receiver in respect of any such property subsisting on the commencement of the Administration of Evacuee Property (Amendment) Act. 1951, shall cease to have effect on such commencement and shall be deemed to be void.

(2) Where, after the 1st day of March, 1947, any evacuee property which has vested in the Custodian or is deemed to have vested in the Custodian under the provisions of this Act has been sold in execution of any decree or order of any Court or other authority, the sale shall be set aside if an application in that behalf has been made by the Custodian to such Court or authority on or before the 17th day of October, 1950.'

On the strength of this section, Sri Pant submitted that after the property had vested in the custodian no evacuee property would be liable to be proceeded against in any manner whatsoever. Sub-section (2) of Sections 17 even provides for setting aside the sale of evacuee property in execution of such a decree on the application in that behalf being made by the Custodian. To my mind even this section has no application to the facts of the present case. The respondents have filed their suit for the refund of the sale consideration in respect of a bona fide transfer of property which was subsequently declared to be an evacuee property. The respondents are not proceeding against the evacuee property itself. The, learned counsel also referred to a similar provision in Section 15 of Act 44 of 1954. But that section also will have no application for the same reasons as indicated above in respect of the application of Section 17 of the Act.

12. Sri Pant strongly relied upon The 'Custodian Evacuee Property Punjab v. Jafran Begam', : [1967]3SCR736 . In that case it was held by their Lordships of the Supreme Court that the Act is a complete Code in itself in the matter of dealing with evacuee property. Section 7 of the Act gives the power to Custodian to determine what properties are evacuee properties. The jurisdiction of the Civil Court or the Revenue Court is barred under Section 46, and no such Court can entertain any suit or adjudicate upon any question whether a particular property or right or interest therein is or is not evacuee property. Where the question whether certain properties are evacuee properties has been decided under Section 7 etc., whether that decision is based on issues of fact or issues of law, the jurisdiction in such a case was held to be clearly barred under Section 46. It would be noticed that the facts in the above case were entirely different from the facts of the present case. In the case in hand there is no question about adjudication of the property as being evacuee or otherwise. The above ruling is, therefore, clearly distinguishable.

13. Sri Pant next relied upon the Explanation added to Sub- rule (4) (a) of Rule 22 of the Rules and urged that the Custodian has been given the power under the said Rule to discharge the 'legitimate obligations and liabilities', and on this basis he argued that the Civil Court had no jurisdiction and it is open to the respondents to approach the Custodian in the matter. In support of his argument he relied upon Raja Bhanu Pratap Singh v. Assistant Custodian E.P. Bahraic : [1966]1SCR304 . It was held in this case that the Custodian can entertain the claim of the holder of a money decree against the evacuee for satisfaction of his dues out of the assets vested in the Custodian by Section 7 of the Act. It was further held that, in view of Section 17(1) of the Act the evacuee property cannot be attached in execution of any decree or order of any Court or other authority whether the claim is against the evacuee or it is against the Custodian arising out of any act of administration done by him. The facts of this case are also distinguishable from the facts of the present case.

14. Next Sri Pant relied upon 'Assistant Custodian Evacuee Property, Meerut v. Virendra Kumar : AIR1965All70 . It was held in this case that, in view of the provisions of Section 17(1) once the property vests in the Custodian it cannot be proceeded against in any manner unless expressly provided is the Act itself Section 16, totally bars the jurisdiction of the Civil Court in respect of certain matters set out therein. It was, however, held that the effect to be given to a notice under Section 50 is not to make the Custodian a legal representative of the evacuee in a suit filed against him but only to keep him in the picture. It was also held that the amendment of Section 10(2)(m) of Act 91 of 1956 had completely taken away the right of the Custodian to make any payment to the decree-holder of an evacuee. The respondents in the present case are not proceeding against the evacuee property. They bona fide claim the refund of the amount paid by them as sale consideration in respect of transfer of property which was later declared to be evacuee property. Section 17, therefore, has no application to the facts of the present case.

15. Sri Pant also relied upon Sections 10(2)(a) of the Act, and relied upon the case of : [1966]1SCR304 in support of his contention that the respondents should approach the Custodian and put up tbeir claim before him. I am unable to accept this argument. So far as the aforesaid Supreme Court Case is concerned, the facts were entirely different and it has got no application to the facts of the present case. The respondents had already been to the Custodian and the Custodian had directed him to establish their claim in a competent Court of law. There is, therefore, no question of their approaching the Custodian now.

16. For the reasons given above I am of the view that the suit is maintainable in Civil Court and the jurisdiction of the Civil Court is not barred in any manner.

17. The next point involved in the case is the question of limitation. The question to be determined is whether Article 97 or Article 120 of the First Schedule of the Limitation Act is applicable to the present case.

18. In order to appreciate the point urged by the counsel for the appellant it would be necessary to read Article 97 and 120 of the First Schedule to the Limitation Act, quoted below:--

Description of suit

Period of limitation

Time from which period begins

to run

97 :For money paid upon an existing consideration which afterwards fails.

Three years

The date of the failure

120 :Suit for which no period of limitation is provided elsewhere In thisSchedule.

Six years

When the right to sue accrues.

19. According to Sri Pant. Article 97 would be applicable to the facts of the present case, while for the respondent it is urged that it is the residuary Article 120 that would be applicable. In interpret-ting the Articles of the Limitation Act certain well-established principles have to be borne in mind, e.g., (i) an interpretation which is penal should be avoided; (ii) if possible, the interpretation which does not bar the suit should be preferred to the one which bars the suit; (iii) if there is a specific Article applicable to the facts of the case, the residuary Article should not be applied; and (iv) all the columns of the Article should be construed. That these principles are well established would be evident from the following cases:

(1) 'Makhan Lal Rai Pramanik v. Pramath Nath Basu : AIR1953Cal50 ;

(2) 'K.S. Rama Swami Ayyar v. S.V. Krishnier : AIR1957Mad431 .

20. We may examine these cases here. In : AIR1953Cal50 it was held that a Court ought not to put such an interpretation upon a statute of limitation by implication and inference as may have a penalizing effect unless the Court is forced to do so by the irresistible force of the language used. The Limitation Act being an Act which takes away or restricts the right to take legal proceedings must, where its language is ambiguous, be construed strictly. To the same effect is the case in : AIR1957Mad431 .

21. Bearing the aforesaid principles in mind we have now to examine whether Article 97 would be attracted in the present case.

22. Article 97 can have no application to the facts of the present case for various reasons. In the first place the period of three years is to be calculated from the date of the 'failure of the consideration'. Now, the question is what will be deemed to be the date of failure. Will it be the date when the application for confirmation of the sale under Section 40 of the Act was dismissed on 19th October, 1951. or it will be the date when the appeal or revision arising out of that order was finally disposed of, or whether it will be the date when the application under Rule 22 of the Rules was rejected on 7-6-1954. If we accept 19th October, 1951, and there is no reason why it should not be accepted, as the date of the failure of the consideration, the limitation would start from that date.

It is well established that once a period of limitation starts running, it cannot be arrested. The law of Administration of Evacuee Property Act--the self-contained Act--provides various remedies open to the purchaser under the Act. It also provides that the transferee has to proceed only in the manner provided by the Act. The respondent in this case did proceed in the manner provided by the Act and the Rules, and he filed the suit only when he had exhausted the remedies open to him under the Act If the respondent could not file the suit just after the 19th of October, 1951, the date of the failure of the consideration, because of certain other obligatory intervening proceedings, that cannot be taken to be the starting point of limitation. In this, the respondent gets support from the case reported in : AIR1955Ori57 ' Panchanan Das v. Province of Orissa wherein it was held that the plaintiff could not bring the suit on the date of cause of action as it was barred by the provisions of the Defence of India Rules. Thus, if the three columns of Article 97 are construed, it is evident that this Article will have no application to the facts of the present case.

23. Another reason for holding that Article 97 will have no application is that if there is a registered document, it is Article 116 which would be applicable and not Article 97. Article 116 of the Limitation Act reads:--

Description of suit

Period of limitation

Time from which period begins to run.

116.For compensation for the breach of a contract in writing registered.

Six years

When the period of limitation would begin to run againsta suit brought on a similar contract not registered.

Admittedly the sale deed in question was a registered document and, therefore, the Article most near and most specific to the facts of the present case could be Article 116, and not 97 (See ' : AIR1946All159 .' If Art. 97, which was sought to be applied by the counsel for the appellant as the relevant Article to the facts of the present case, has no application, we have to fall back upon Article 120 of the Limitation Act. Which of the two Articles -- Article 116 or 120 -- would apply, should not detain us, as in either case the period of limitation is six years, and if any of these Articles applied to the present suit, it would be well within time.

24. Sri. Pant relied upon 'Ram Bali Singh v. Shyam Sunder Misra', AIR 1922 All 475. In this case a pre-emptor impleaded in the suit only one of the four brothers alienees of the property purchased, due to a mistake of fact. The suit was decreed, and the entire consideration was realized by the alienee who was impleaded and he was given formal possession. The pre-emptor's application for mutation was resisted by the three brothers of the alienee, who were not impleaded, and their objection was allowed except for l/4th share of the alienee who had been impleaded. Thereafter the pre-emptor filed a suit for possession of the property released in favour of the three brothers or, in the alternative, for proportionate refund of the pre-emption money. It was held in these circumstances that the cause of action arose when the pre-emptor's claim for mutation was resisted, i.e., when the consideration failed or when the mistake of fact was discovered.

25. In the present case, however, the respondents were not in a position to bring the suit as there were certain intervening proceedings which they had to take before they could file a suit. The above ruling has, therefore, no application to the facts of the present case, Mr. Pant cited a few other cases also, but they are all clearly distinguishable.

26. Sri Agrawala, appearing for the respondents, relied upon : AIR1965Ker154 ', C. Ittycheria v. O. Varughese. In this case a mortgagee brought a suit for realization of money advanced by him on a usufructuary mortgage to the mortgagor on the latter's failure to put the former in possession of the property. It was held that money was advanced not on the strength of a mere promise to execute a mortgage deed but as consideration for a mortgage with possession; payment of money could not be considered as 'money paid upon an existing consideration' and the plea that the suit was barred by Article 97 of the Limitation Act was unsustainable.

27. He also relied upon 'AIR 1967 Delhi 91' Ram Lal Puri v. Gokalnagar Sugar Mills Co. Ltd. It was a suit for recovery of earnest money paid under a sale which did not materialize. It was held that the suit would be governed by Article 120 of the Limitation Act and not by Articles 62, 97 or 115. In my opinion the cases cited by Mr. Agarwala are more near the case than the cases relied upon by Sri Pant.

28. For the reasons given above I am unable to hold that the view taken by the Courts below was erroneous in any manner on both the points, and so the appeal must be dismissed.

29. The appeal is accordingly dismissed with costs.


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