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Harij Gram Panchayat Vs. Thakkar Lakhiram Ramji and ors. - Court Judgment

LegalCrystal Citation
SubjectLimitation
CourtGujarat High Court
Decided On
Case NumberA.F.A.D. No. 40 of 1960
Judge
Reported inAIR1962Guj14; (1961)GLR660
ActsLimitation Act, 1908 - Schedule - Articles 60, 62, 97 and 120
AppellantHarij Gram Panchayat
RespondentThakkar Lakhiram Ramji and ors.
Appellant Advocate S.N. Patel, Adv.
Respondent Advocate C.K. Shah, Adv. and; B.R. Sompura, Asstt. Govt. Pleader
DispositionAppeal dismissed
Cases ReferredLingangouda Marigouda v. Lingangouda Fakirgouda
Excerpt:
.....construed because a liberal construction would result in more plaintiffs losing in a large number of cases on the ground of limitation, because if article 62 is strictly construed, then the suit would fall under article 120 which gives to the plaintiff a longer period of limitation......5 cal 830. now article 62 applies to suits for money payable by the defendant to the plaintiff for money received by the defendant for the plaintiff's use. by reason of the use of this language which is borrowed from english cases, the courts in some cases have been misled into thinking that the cause of action envisaged by article 62 is that for money had and received as understood in england. but as observed by chagla c. j., in lingangouda marigouda v. lingangouda fakirgouda, 54 bom lr 829 : (air 1953 bom 79) though the language used in this article is the language taken from english cases.'..... there is one important fact that should be borne in mind that in england it was necessary for the courts to find an implied contract in order that suits may be maintainable. a suit in personam.....
Judgment:

P.N. Bhagwati, J.

1. The second contention of Mr. S.N. Patel was founded on the plea of limitation. According to Mr. S.N. Patel the suit as originally filed claimed a decree in favour of the firm of Thakkar Lakhiram Ramji and it was only by the application for leave to amend that a decree in favour of Thakkar Lakhiram Ramji as an individual was sought for the first time against the Harij Village Panchayat. The contention of Mr. S.N. Patel was that on 19th March 1953 when the application for leave to amend the plaint was made, the cause of action for refund of the amount of the deposit was time-barred since a period of three years had already elapsed from the date of accrual of the cause of action and that no relief could, therefore, be granted in favour of Thakkar Lakhiram Ramji as an individual. In my opinion this contention is also without any substance. The cause of action in the suit was for recovery of the amount deposited by Thakkar Lakhiram Ramji with the Harij Municipality as and by way of security for the due performance of the contract. The period of the contract expired on 31st July 1949 and the amount of the deposit, therefore, became repayable to Thakkar Lakhiram Ramji on 1st August 1949. The suit in so far as the claim of Thakkar Lakhiram Ramji as an individual is concerned must obviously, having regard to the provisions of Section 22 of the Limitation Act, be taken to have been filed on 19th March 1953 i.e., more than three years after the date of accrual of the cause of action. It is, therefore, clear that if the period of limitation is three years, no relief could be granted in favour of Thakkar Lakhiram Ramji as an individual and the suit would have to be dismissed. But it would be otherwise if the period of limitation is six years. The question which, therefore, arises for consideration is as to which is the article which applies to the claim made in the suit.

2. Mr. S.N. Patel relied on Articles 60, 62 and 97 of the Limitation Act. So far as Article 60 is concerned it is obvious that that Article cannot apply for it is only to suits for money deposited under an agreement that it shall be payable on demand that Article applies. The amount claimed in the suit cannot be said to have been deposited under an agreement that it shall be payable on demand. The amount was in fact deposited as security for due performance of the contract and it was only on the due performance of the contract that the amount became repayable to Thakkar Lakhiram Ramji. The amount was certainty not payable on demand. Article 60 must, therefore, be left out of consideration. Article 97 is equally inapplicable for by its very language it applies only to suits for money paid upon an existing consideration which afterwards fails. There is no question in the present case of any failure of consideration. I need not, therefore, discuss any further the applicability of Article 97. The only other Article on which reliance was placed by Mr. S.N. Patel was Article 62 and in support of his contention that this Article applied, Mr. S.N. Patel invoked the aid of a decision of the Calcutta High Court reported in Johuri Mahton v. Thakoor Nath Lukee, ILR 5 Cal 830. Now Article 62 applies to suits for money payable by the defendant to the plaintiff For money received by the defendant for the plaintiff's use. By reason of the use of this language which is borrowed from English cases, the Courts in some cases have been misled into thinking that the cause of action envisaged by Article 62 is that for money had and received as understood in England. But as observed by Chagla C. J., in Lingangouda Marigouda v. Lingangouda Fakirgouda, 54 Bom LR 829 : (AIR 1953 Bom 79) though the language used in this Article is the language taken from English cases.

'..... there is one important fact that should be borne in mind that in England it was necessary for the Courts to find an implied contract in order that suits may be maintainable. A suit in personam would not lie unless there was an express or implied contract and therefore the Courts were at pains in many cases to infer or imply a contract so that the plaintiff should not fail by reason of a defect in procedure. Therefore, in the English books there are many cases where an implied contract has been arrived at in order to sustain the action. In India there never was any reason to stretch a point in favour of the plaintiff, in order to sustain his action. As Courts here were both Courts of law and equity, the question of formal procedure which was of such importance at one stage in England never troubled our Courts and our Judges, and therefore it is not always safe to follow English decisions in construing Article 62. If anything, in India Article 62 should be more strictly construed because a liberal construction would result in more plaintiffs losing in a large number of cases on the ground of limitation, because if Article 62 is strictly construed, then the suit would fall under Article 120 which gives to the plaintiff a longer period of limitation.'

3. I must bear these observations in mind while determining whether the present case is governed by Article 62. I must not import into the determination of the question the consideration whether the present suit would be a suit for money had and received under the common law in England but I must see whether on a strict construction of the language Article 62 applies to the present suit. It is no doubt true that the Calcutta High Court hasheld in Johuri Mahton's case, ILR 5 Cal 830 (supra) that Article 62 applies to a suit for recovery of an amount deposited as security for due performance of a contract but that decision proceeds on the assumption that such a suit is a suit for money had and received as understood in England and that Article 62 refers to all cases where a suit for money had and received would lie at common law in England. This assumption is unjustified and as Chagla, C. J., has pointed out, if Article 62 is construed in the manner in which the Calcutta High Court hag done, a large number of cases would be liable to be dismissed on the ground of limitation. I cannot therefore, follow the decision of the Calcutta High Court referred to above. Turning to the language of Article 62, it is obvious that this Article can apply only where money has been received by the defendant for the plaintiff's use and the period of limitation in such a case is three years from the date when the money is received. Now can it be said in the present case that the amount of the deposit was received by the Harij Municipality for the use of Thakkar Lakhiram Ramji? The answer is obvious. The amount was received not for the use of Thakkar Lakhiram Ramji but as and by way of security for the due performance of the contract. At the date when the amount was received, it must be seen whether it was received for the use of Thakkar Lakhiram Ramji and judged by this test it is clear that it was not received for the use of Thakkar Lakhiram Ramji. This being the position, Article 62 cannot possibly apply to the suit. Since there is no specific article which applies to the suit, the period of limitation for the suit must be governed by Article 120 which prescribes a period of six years from the date of accrual of the cause of action and in that view of the matter the suit cannot be said to he barred by the law of limitation. The contention of Mr. S.N. Patel founded on the plea of limitation must therefore be rejected.


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