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Surendra Nath Bhuyan Vs. Official Liquidator, Puri Bank Ltd. - Court Judgment

LegalCrystal Citation
SubjectLimitation
CourtOrissa High Court
Decided On
Case NumberO.S. No. 1 of 1957
Judge
Reported inAIR1961Ori57; [1962]32CompCas584(Orissa)
ActsLimitation Act, 1908 - Sections 14 and 14(1); Banking Companies Act, 1949 - Sections 45B
AppellantSurendra Nath Bhuyan
RespondentOfficial Liquidator, Puri Bank Ltd.
Appellant AdvocateB.M. Das, Adv.
Respondent AdvocateJ. Rath, Adv.
DispositionSuit dismissed
Cases ReferredKedar Mull v. Wazifunessa
Excerpt:
.....to or arise in course of the winding up of the company. 393 of 1954 from october 1, 1954 when the puri suit was filed till september 9, 1957, when the present suit was filed in the high court as the proper court and thus whether he is entitled to the benefit of section 14 of the limitation act which provides that in computing the period of limitation prescribed for any suit, the time during which the plaintiff has been prosecuting with due diligence another civil proceeding in another court shall be excluded where the proceeding is founded upon the same cause of action and is prosecuted in good faith in a court which from defect of jurisdiction or other cause of like nature is unable to exercise it. good faith' as defined in section 2(7) of the limitation act is that nothing shall be..........suit in puri court the bank had taken defence that the puri court had no jurisdiction to try the suit.bhuyan however pursued the suit in puri court which ultimately was dismissed on the ground of want of jurisdiction of the puri court to entertain the suit by reason of the provisions of the banking companies act as aforesaid. the said suit was dismissed on august 30, 1957. thereafter the present suit was filed on september 9, 1957 in the high court.the question here is whether bhuyan is entitled to the exclusion of the period of the pendency of the said puri suit no. 393 of 1954 from october 1, 1954 when the puri suit was filed till september 9, 1957, when the present suit was filed in the high court as the proper court and thus whether he is entitled to the benefit of section 14 of.....
Judgment:

S. Barman, J.

1. This is a suit by the plaintiff one Surendra Nath Bhuyan against the liquidator, Puri Bank Ltd. for setting aside an ex parte decree passed against him for a sum of Rs. 1,698/- on the facts and circumstances hereinafter stated.

2. This litigation had a chequered career beginning from January 29, 1948 when the Bank filed in the court of the Subordinate Judge, Puri, a petition along with a plaint, being Misc. Case No. 9 of 1948 to sue in forma pauperis the said Surendranath Bhuyan, on his current account with the Bank as appears from the relevant order-sheet (Ext. T). The whereabouts of the said Surendra Nath Bhuyan, defendant in the said suit, were reported fo be unknown and accordingly an order for substituted service was obtained as hereinafter stated. On July 17, 1948 the said petition in forma pauperis was allowed and it was converted to Money Suit No, 437 of 1948.

On August 31, 1948 there was an order for fresh service of summons on the said Bhuyan. The service was found to be insufficient and accordingly On October 26, 1948 there was an order for substituted service. On November 20, 1948 the Bank filed a Hazira and proved service. On November 25, 1948 the return of summons was received after having been duly served under Order 5, Rule 20; the defendant was absent on the date and was set ex parte. Thereafter after several adjournments, as appears from the order sheet (Ext. T) the suit was decreed, ex parte as against the said Bhuyan on December 2, 1948 and in due course a decree was drawn up and notified on December 6, 1948.

Thereafter, the execution proceeded in this High Court being the first Execution Case No. 6 of 1952 relating to the attachment of moveables of the said Bhuyan in execution of the said decree. In course of the execution, as appears from the order dated 23-4-54 in the order sheet (Ext. T-1), a sum of Rs. 200/-was credited towards the decretal amount as requested. On that date the petition dated March 12, 1954 by the said Bhuyan for payment in instalments was objected to by the decree-holder. Thereafter on November 23, 1956 an order was made by this Court on the said Bhuyan's application for adjustment of the decree and by the said order the application was rejected for the reasons stated therein.

There was also another execution case in this High Court being Execution Case No. 7 of 1953 in respect of immoveables (Ext. T-2) commencing from March 30, 1953. It appears from the order dated August 25, 1954 that the learned Advocate for Bhuyan stated that the petition for stay of issue of attachment will not be pressed by him. On November 1, 1954 a petition was filed in Court by the Advocate for Bhuyan with a prayer to strike out and drop the execution cases.

On Nov. 12, 1954, as appears from the order-sheet, this Court made certain observations with regard to an application for injunction in which connection the learned Advocate for Bhuyan pressed that there was an order for temporary injunction issued against the decree-holder Bank not to proceed with the execution. However, apparently there was some controversy with regard to the position with which this Court is not concerned for the present purpose. It is however clear from the said order-sheet that ultimately on February 11, 1955 execution was directed to proceed.

The order-sheet in the Execution Case no. 6 of 1952 with regard to moveables (Ext. T-1) shows that it covered a period from February 15, 1952 to September 2, 1957. The other execution case with regard to immoveables being Execution Case No. 7 o 1953, as appears from the order-sheet (Ext. T-2), covered a period from March 30, 1953 to November 23, 1956. During this period, it is apparent from the order-sheets that the defendant Bhuyan through his Advocate had been asking for different reliefs in connection with the execution of the decree against him. So far as this Court is concerned, during three years at the stage of execution Bhuyan had not made all the alleged grievances that he is making now.

Prior to the filing of this suit in this Court, Bhuyan had filed a suit being Suit No. 393 of 1954 Class I in the Court of Munsif, Puri, when it was found that the Puri Court had no jurisdiction to try the said suit, that the High Court alone had the exclusive jurisdiction by reason of the provisions of the Banking Companies Act and accordingly by an order dated August 30, 1957 made by the Puri Court, the plaint was directed to be returned to the plaintiff Bhuyan for presentation in proper Court within ten days from the date of the said order. Thereafter the present suit was filed in this Court on September 8, 1957 for setting aside the ex parte decree which is alleged to have been obtained by fraudulent suppression of summons. The Bank took the defence denying all allegations of alleged fraud. The issues raised on the pleadings are these:

(1) Is the suit barred by limitation?

(2) Has the plaintiff any cause of action for the suit?

(3) Was the decree in Money Suit No. 437 of 1958 obtained by fraudulent suppression of summons and postal notices on the defendant as alleged and is the decree liable to be set aside?

(4) Was the claim in money suit No. 437 of 1948 in the court of the Subordinate Judge of Puri, a false and excessive one?

(5) To what relief, if any, is the plaintiff entitled?

ISSUE No. 1 Re: LIMITATION.

3. Article 95 of the Limitation Act, applicable to this case, provides that three years is the period of limitation from the time when the alleged fraud became known to the party wronged. The case of the defendant Bank in this suit is that Bhuyan, in any event, came to know of the ex parte decree passed against him from a letter of the Additional District Magistrate, Puri being a notice referring to Orginal Suit No. 437 of 1948 in the Court of the Subordinate Judge, Puri (Ext. U) whereby he was directed to show cause by June 20, 1952 why execution proceeding will not start against him.

Bhuyan in his evidence in this Court as P. W. 4 admitted that he in 1952 came to know from the said letter from the A. D. M., Puri, that Puri Bank had taken an ex parte decree in Puri Court against him. In October 1954 Bhuyan filed a suit in Puri Court being Suit No. 393 of 1954 for setting aside the ex parte decree, although under the Banking Companies Act the High Court alone had the exclusive jurisdiction to entertain such suit and not the Munsif's Court, Puri. Clearly Bhuyan was wrongly advised to file the said suit in the Puri Court having regard to Section 45B df the Banking Companies Act, 1949.

With a view to conferring on the appropriate High Court exclusive jurisdiction in regard to matters appertaining to Banking Companies, Section 45A and 45B and other sections were inserted in this Act by the amendment Act 1950. These sections conferred powers on the High Court to decide all claims made by or against a Banking Company and all questions of priorities and all other questions whatsoever whether of law or of fact which may relate to or arise in course of the winding up of the company.

Thus it is clear that only the High Court (and no other court) has jurisdiction to entertain any matter relating to or arising out of the winding up of a Banking Company, including claims made by the banking company which was being wound up or for claim made against the banking company which was being wound up. In the said suit in Puri Court the Bank had taken defence that the Puri Court had no jurisdiction to try the suit.

Bhuyan however pursued the suit in Puri Court which ultimately was dismissed on the ground of want of jurisdiction of the Puri Court to entertain the suit by reason of the provisions of the Banking Companies Act as aforesaid. The said suit was dismissed on August 30, 1957. Thereafter the present suit was filed on September 9, 1957 in the High Court.

The question here is whether Bhuyan is entitled to the exclusion of the period of the pendency of the said Puri Suit No. 393 of 1954 from October 1, 1954 when the Puri suit was filed till September 9, 1957, when the present suit was filed in the High Court as the proper court and thus whether he is entitled to the benefit of section 14 of the Limitation Act which provides that in computing the period of limitation prescribed for any suit, the time during which the plaintiff has been prosecuting with due diligence another civil proceeding in another Court shall be excluded where the proceeding is founded upon the same cause of action and is prosecuted in good faith in a Court which from defect of jurisdiction or other cause of like nature is unable to exercise it.

'Good faith' as defined in Section 2(7) of the Limitation Act is that nothing shall be deemed to be done in good faith which is not done with due care and attention. Here it is to be considered whether the lawyer for Bhuyan had taken due care and attention in filing suit No. 393 of 1954 in Puri Court and pursuing the same there although and even after the point of jurisdiction had been taken therein. The position in law that such a suit is only maintainable in the High Court and not in any other Court had been well settled by a decision of this Court which was decided on December 1, 1953 and reported early in 1954 in H. Naik v. Jitendra Nath Das, ILR 1954 Cut 65: (AIR 1954 Orissa 139) where it was decided that the High Court alone had exclusive jurisdiction under Section 45A and Section 45B (1) of the Banking Companies Act as amended in 1950 to decide this question and all other questions arising out of the same.

That apart, when the Bank had taken the defence challenging the jurisdiction of the Puri Court to entertain the suit the lawyer for Bhuyan should have taken care not to pursue the suit any further in Puri Court and should have filed the suit in the High Court within three years from the date of knowledge of the alleged fraud as provided in Article 95 of the Limitation Act. As hereinbefore stated Bhuyan came to know of the ex parte decree in 1952 from the letter of the A. D. M. Puri (Ext, U); accordingly it was open to him to file the suit in the High Court by 1955 which would have been within time prescribed by the Act.

It appears from records that an advocate was appearing for Bhuyan in the Puri Court in the said suit No. 393 of 1954. The legal position ought to have been apparent to his lawyer that there was a clear provision of the statute that it was the High Court alone which had the jurisdiction to entertain such a suit. It is evident that the lawyer in charge of Bhuyan's case in Puri Court had completely ignored the actual position in law nor did he take due care and attention to ascertain the legal position.

The position, as appears to me, is manifest that slightest care and attention would have impelled the learned Advocate to file the suit in the High Court. The well settled position in law was made clear on review of several cases on the point in a Bench decision of this Court reported in Tirumala Bhaskara Rao Naidu v. Panasa Narayanamma, ILR 1956 Cut 135: ((S) AIR 1956 Orissa 124) that it cannot be the rule of law that any mistaken advice given by a counsel is a sufficient ground for condoning the delay.

A party is not completely absolved of the responsibility and automatically becomes entitled to the benefit of Section 14 of the Limitation Act or to the protection under Section 5 of the Limitation Act by merely entrusting his work to an advocate. But if the view taken by the legal adviser is a reasonable view even though mistaken and if the said advice could be given by any senior lawyer in spite of due care and attention, then only the party is entitled to the provisions of section 5 or section 14 of the Limitation Act.

But this is not the position in the instant case. The learned Advocate invited a great risk to his client without any justification whatsoever in filing and pursuing the suit in the Puri Court. It is quite apparent that nobody concerned looked up either the Banking Companies Act or the Indian Companies Act or the judicial decision of this Court on the point reported as early as in 1954 as aforesaid, which clearly shows want of due care and attention as required by law in order to entitle the plaintiff to the benefit of Section 14 of the Limitation Act. Raja Gopal Rao v. Dolgovinda Sahu, ILR 1959 Cut 265: (AIR 1959 Orissa 31).

On this point Mr. B. M. Das, learned counsel for the plaintiff Bhuyan in this Court, relied on a decision of this Court in Sri Baldev Jiu Thakur v. Dhaneswar Misra, 1959 Orissa JD 609: (AIR 1961 Orissa 54) : where on the facts and circumstances of that particular case it was held that the suit was not barred by limitation. In that particular case the defendant, who was a Tahasildar of the plaintiff deity installed in its temple, was dismissed for alleged misappropriation of monies and negligence for the management of the said Thakur's property; the plaintiff deity filed a suit for recovery of the monies, accounts and other incidental reliefs against the Tahasildar in the 2nd Munsif's Court at Cuttack, in defence a point of jurisdiction was taken that the Munsif's Court had no jurisdiction to entertain the suit.

Ultimately the Munsif returned the plaint to be filed in the Revenue Court on the ground that the Civil Court had no jurisdiction; when the plaint was filed in the Revenue Court a point of limitation was taken on behalf of the defendant that the time limit expired from the date of the dismissal of the defendant Tahasildar the suit was barred by limitation; the point for consideration in that matter was whether the plaintiff was entitled to the exclusion of the period covered in the Civil Court under Section 14 of the Limitation Act.

In that particular case, there were allegations of damages and negligence as alleged in the plaint; furthermore, the question whether the relationship between the plaintiff Thakur and the dismissed Tahasildar was of principal and agent within the meaning of Section 193 (b) of the Orissa Tenancy Act or whether the relationship was one of mere master and servant was of involved nature and this uncertain legal position quite justifiably gave rise to doubt in the mind of the lawyer as to the scope of the forum where the suit should be filed, namely, whether it should be the Civil Court which has all embracing jurisdiction to entertain all suits of civil nature or the Revenue Court which had only exclusive jurisdiction within certain specified limits as provided in the Orissa Tenancy Act.

Considered from this aspect, this Court to that particular case took the view that it cannot be said that the lawyer in that case was unreasonable or negligent even though he might have been ultimately found to have been mistaken in the view that he took with regard to jurisdiction. That, however, is not the position in the present case before me in this suit. Here, the legal position was patently clear and with a little care and attention it could have been easily found that the Puri Court had no jurisdiction and it was only the High Court's exclusive jurisdiction to entertain such a suit. Thus the case relied on by the learned counsel for the plaintiff Bhuyan does not help him.

With reference to an order dated. November 17, 1953 made in the said Execution Case No. 8 of 1952 (Ext. E-1) whereby Bhuyan's objection petition was rejected on the ground that the objection to execution should have been raised before the passing of the decree, Mr. B. N. Das further contended that the meaning of the said order, according to him, was that unless the ex parte decree was set aside, no objection to execution could be considered and that it was then he for the first time realised the position in November 1953.

But even so, Bhuyan did not take any step until October 1954 when he filed the said suit No. 393 of 1954 for setting aside the ex parte decree and that also in a court without jurisdiction as aforesaid and that the suit was dismissed as aforesaid. There was no excuse for filing the suit in a wrong forum for reasons as discussed above. I do not accept this explanation made on behalf of Bhuyan.

In this view of the matter on the point of limitation, I am of opinion that the plaintiff Bhuyan is not entitled to the benefit of Section 14 of the Act and accordingly this suit is barred by limitation.

ISSUE Nos. 2 and 3 Re : FRAUD.

4. On merits, Mr. J. Rath, learned counsel for the defendant Bank, contended that there was no fraud on the part of the Liquidator of the Bank in the matter of service of summons on the plaintiff Bhuyan in the Bank's said previous Money Suit No. 437 of 1948. In order to charge a party with fraud in suppression of summons, it is essential to prove that the non-service was the result of some active part taken by that party in not having the summons served and thereby keeping the opposite party from the knowledge of the suit.

The present suit was instituted under Article 95 of the Limitation Act to set aside a decree alleged to have been obtained by fraud or for relief on the ground of fraud; if it was an application merely to set aside a decree passed ex parte, under Order 9, Rule 13 Civil Procedure Code, the plaintiff Bhuyan would have to come within 30 days from the date of the decree or, where the summons was not duly served, (as it is alleged to be in the present case) when the applicant has knowledge of the decree; but Bhuyan did not choose to seek relief under Order 9, Rule 13. Now that in this suit for setting aside the ex parte decree, Bhuyan claims the limitation of three years under Article 95, he must show that the decree was obtained by fraud; he must show that summons was fraudulently suppressed and by fraud of the Bank he was kept ignorant of the decree; mere non-service of summons is not sufficient.

There is no doubt as to the position in law that a decree passed by a competent court cannot be set aside by a suit, simply on the ground that it is based on a false claim or on the mere ground that there was no service of summons or notice; but after the court comes to a finding as to the non-service of summons or notice, the Court may go into the question whether there was a motive for wilful or fraudulent suppression of the notice or summons in order to obtain a decree based on a false claim: Rani Chhatta Kumari Debi v. Radhamohan Singari, AIR 1922 Pat 291 at p. 292; Abbasalli Bhuiya v. Ramkanai Majumdar, AIR 1935 Cal 95; Jagdeo Prasad v. Bhagawan Hajam, AIR 1936 Pat 135; Memon Aba Isa Haji Adhareman v. Memon Mamad Haji Suleman Chamadia, (S) AIR 1955 Sau 28.

5. In this background of the legal position, the main question for consideration in the present case is whether there was service of summons on plaintiff Bhuyan in the said previous Money Suit No, 437 of 1948; and if not, whether the ex parte decree obtained on such service was by fraudulent suppression of the summons as alleged. In the plaint no particulars of alleged fraud have been specifically mentioned as required by law.

6. Fraud must be specifically proved and cannot be based on mere suspicion; the party alleging fraud is bound to establish it by cogent evidence and suspicion cannot be accepted as proof; unless, therefore, the proved circumstances are incompatible with the hypothesis of the person charged with fraud having acted in good faith, they cannot be accepted as affording sufficient proof of fraud; fraud like any other charge of criminal offence, whether made in Civil or Criminal proceedings, must be established beyond reasonable doubt; the finding of fraud cannot be based on suspicion and conjecture (Satyanarayan Agarwalla v. Lakhiram Agarwalla, ILR 1959 Cut 526. (Then after discussing evidence Tegarding service of summons His Lordship came to the conclusion):

7. In the ultimate analysis of all the surrounding facts and circumstances I am of opinion that the alleged fraud in the matter of service of summons has not been proved. Mere non-service of summons is not sufficient to set aside the ex parte decree in the state of the law, as well settled as aforesaid.

Mr. B. M. Das, learned counsel for the plaintiff Bhuyan, relied on a decision of the Lahore High Court in Tara Chand Singh v. Santosh Singh, AIR ,1935 Lah 129 where it was held that where the plaintiff knew the whereabouts of the defendant and in spite of that fact he obtained by a false representation, an order for substituted service by giving the Court to understand that the defendant had been deliberately avoiding service, the defendant had not been properly served as required by law and that the ex parte proceedings against him were not binding on him. The learned counsel also, for the same purpose, relied on a decision of the Calcutta High Court in Kedar Mull v. Wazifunessa, AIR 1934 Cal 745 where it was held that even though the substituted service may be considered as personal service on the defendants under the provisions of Order 5, Rule 20 clause (2), this does not preclude the defendants from afterwards showing that in fact there had been no service on him at all and that the order for substituted service was procured on misrepresentation of facts; when the order for substituted service is made on the representation that the defendants had been residing at a particular place where as a matter of fact the defendant never resided for sometime past and it was on such representation that the Court was induced to hold that the substituted service was properly effected, the service effected upon the defendant under Order 5. Rule 20 is not due service. This indeed is good law in the context of an application for setting aside an ex parte decree passed against a defendant under Order 9, Rule 13, Civil Procedure Code. Indeed, it was open to Bhuyan to make an application under Order 9, Rule 13 within 30 days from the date of the decree or when the summons was not duly served, as his alleged case is in the present case, when he had the knowledge of the decree. It was open to him to apply which course, however, be did not choose to take; he instead filed a suit for setting aside the ex parte decree long beyond the time allowed under Article 95 of the Limitation Act. Thus on the facts and circumstances of this case neither of these decisions relied on by the learned counsel are applicable here in the present case. The question in each of these cases, cited above, was whether it was due service under Order 5, Rule 20 in the context of an application under Order 9, Rule 13 Civil Procedure Code which could be filed within 30 days under Article 164 of the Limitation Act.

8. IN this view of the matter as discussed above on Issues Nos. 2 and 3, I am of opinion that the plaintiff failed to prove the alleged fraud and that he has no cause of action for the suit; and accordingly the decree is not liable to be set aside.

ISSUE NO. 4:

9. This issue was by consent of the parties not pressed.

10. The result, therefore, is that this suit isdismissed; but in the circumstances of the case Imake no order as to costs of this Court.


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