1. The point for decision in this appeal is whether the plaintiff--appellant's suit is governed by Article 62 of the Limitation Act, in which case it is time barred, or by Article 120, in which case the suit will be in time.
2. The appellant was auction-purchaser at a Court-sale of certain items of property sold by defendants 5 to 10 in execution of a decree obtained by them in a Rent suit against defendants 3 and 4. The date of the sale was 25th September, 1918, and it was confirmed on 11th December, 1918. The purchase price was Rs. 2,525 which was duly deposited in Court. In the meantime a stranger in these proceedings had brought a suit O.S. No. 723 of 1918, for recovery of possession, alleging that in as much as the judgment-debtors had already sold the lands to him they had no saleable interest in the land, and that there were irregularities in the sale to the appellant. This suit was decreed on 15th December, 1919, the Court holding that there were irregularities in the conduct of sale sufficient to set it aside. A prohibitory order had been obtained against the Deputy Collector that he should not part with the purchase-money deposited by the appellant. But this order expired on 20th November, 1918 and a payment of Rs. 1,200 odd was made to the defendants in July, 1919. In consequence of the decree setting aside his sale the appellant on 30th April, 1920, put in a petition to the Court of the Deputy Collector for a refund of the purchase-money. In reply he was informed on 1st November, 1920, that the money had been paid to the decree-holders towards the decretal amount. A further petition was made on 18th December, 1922, but this was rejected. As a matter of fact, only half of the purchase money had been paid away and the statement that all had been paid was a mistake of the Deputy Collector.
3. The appellant filed his suit on 6th July, 1925. The plaint does not say in so many words that the claim is for money payable by the defendants to the plaintiff for money received by the defendants for the plaintiff's use. But that is the substance of the claim set out in his pleadings. The basis of a suit for money had and received will be found described in Bullen and Leak's Precedents of Pleadings (8th Edition), p. 265 thus:
When a person receives money which injustice and equity belongs to another, as a rule a debt is created and the money can be recovered by an action for money received to the use of the plaintiff.
4. If the appellant's suit is, as I have no doubt it is, one for money had and received, Article 62 of the Limitation Act governs it, as both the lower Courts have held, and the suit is time barred.
5. The learned Advocate for the appellant, however, takes his stand on certain rulings of this High Court and contends that Article 120 of the Limitation Act governs the suit. In Nilakanta v. Imamsahib I.L.R. (1892)Mad. 361 : 3 M.L.J. 134, where a Court-sale had been set aside on the ground that the judgment-debtor had no saleable interest in the property sold, it was held that Article 120 governed the plaintiff's suit to recover the purchase money from the decree-holder. The explanation of that decision is, I think, that the suit was one under Section 315 of the Code of Civil Procedure, 1882. The case was followed in Mohideen Ibrahim v. Mahomed Mura Levvai : (1912)23MLJ487 . The head-note which appears to accurately express the gist of the judgment, says:
An auction-purchaser had a substantive right of suit under the Code of 1882, i.e., Section 315) for the refund of the price money paid by him when it was found that the judgment-debtor had no saleable interest; and Article 120 of the Limitation Act applied to such suits.
6. The Court therefore, held that a suit founded upon a substantive right to a refund of purchase money on the setting aside of a Court sale must be regarded as outside the category of a suit for money had and received. Certain observations of their Lordships of the Judicial Committee in Juscurn Bold v. Pirthichand Lal , suggest a doubt whether a suit framed as a suit for money had and received, in circumstances that would support such a suit, would not be subject to Article 62 notwithstanding that the plaintiff has a right to a refund reserved to him by a particular enactment. In the case in question the sale of a patni taluk for arrears of rent had been set aside in proceedings under Bengal Regulation VIII of 1819. The purchaser was a party to the proceedings, but had not been awarded an indemnity for his loss in accordance with the Regulation. He accordingly sued the Zemindar to recover the purchase money paid to him. Their Lordships, referring to Article 97 which governs the period of limitation for suits ' for money paid upon an existing consideration which afterwards fails', said:
If regard be had to the peculiar character of a sale under the Regulation it is manifest that the facts but imperfectly fit the phrase, they perhaps more nearly approach the formula of ' money had and received by the defendant for the plaintiff's use ', if read as a description and apart from the technical qualifications imported in English law and procedure.
7. Their Lordships dealt with the case on the assumption } that Article 97 was applicable. In the present appeal the suit was not founded on any express right reserved to the appellant by, the Civil Procedure Code to recover the money. The sale was not set aside under Order 21, Rule 92, Civil Procedure Code but, in a suit, and consequently an order for refund under Rule 93 would not be available to the appellant; so that his only remedy would be a suit to recover the purchase money as money had and received.
8. Another case to which I must refer is Baisnath Lala v. Ramadoss I.L.R.(1914)Mad. 62 : 27 M.L.J. 640, where it was held that a suit under Section 73, Clause (2), Civil Procedure Code, for a refund of money improperly paid to a person in a rateable distribution of assets was governed by Article 62. In the course of the judgment it is observed:
If on such a re-adjustment being made the plaintiff in a suit under Section 73 is found to be entitled to a portion of the assets which have been paid to the defendant, we are of opinion that the latter must be regarded as having received the portion so paid to him, for the use of the plaintiff.
9. This line of reasoning appears to me to be equally appropriate to the case of a defendant who has received payment of the purchase money through the court and the sale has been subsequently set aside.
10. In my judgment the plaintiff's suit is governed by Article 62 and was time barred. His appeal must therefore be dismissed with one set of costs as against defendants 5 to 10, and with costs as against the first defendant respondent, the Secretary of State. The plaint discloses no cause of action against this defendant. Assuming for the purpose of argument that the retention of a part of the purchase money by the Deputy Collector would furnish a ground of action it is clear that he was acting as a judicial officer, and that he would have the protection of Act XVIII of 1850. With regard to the balance of the purchase money which remains with the Government the learned Government Pleader has indicated the means provided by the Devolution rules for its recovery by the appellant. As defendant 3 was merely a formal party against whom no claim was made in the plaint there will be no order for costs as regards him. It is stated that second defendant drew Rs. 856-9-0 under an attachment. In the plaint it is alleged that plaintiff came to know of this payment to second defendant on 15th December, 1922. The case will have to go back for a finding as to the date on which second defendant drew the money. If it was within 3 years from the date of plaint, plaintiff's claim against this defendant in respect of the money so received will not be barred. Findings to be returned in two weeks from re-opening of the High Court. Ten days for objections.
11. In pursuance of the directions contained in the above judgment the District Judge of Ganjam submitted the following:
Finding. - The High Court has called for a finding from this Court as to the date on which the 2nd defendant drew the sum of Rs. 850-9-0.
12. Civil Register No. 37 of the years 1919-1920 of the Court of the District Magistrate, Aska, at page 153, Dr. side second entry shows that the sum was drawn on 16th July, 1919. There is a slight mistake in the year of the suit but there can be no doubt, that the sum drawn on that day was the sum referred to. Mr. D. V. Narasinga Rao, Advocate for the plaintiffs, does not now dispute the fact that the money was drawn oh 16th July, 1919. It is found accordingly.
13. This Second Appeal as against the second respondent coming on for final hearing after the return of the finding of, the lower Appellate Court upon the point referred by this Court for trial, the Court delivered the following judgment:
The finding is accepted. The appeal is dismissed with costs as against the second respondent also.