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Ramalinga Kalingarayar Vs. the Village Panchayat, Vadakkur South by Its President A. Swaminathan and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai High Court
Decided On
Reported in(1980)2MLJ345
AppellantRamalinga Kalingarayar
RespondentThe Village Panchayat, Vadakkur South by Its President A. Swaminathan and ors.
Cases ReferredPanchayats Act. In Subbiah Thevar v. Samiappa Mudadiar
Excerpt:
- .....suit and for recovering the amount. the collector of thanjavur gave sanction for the filing of the suit. the suit was actually filed on 12th june, 1967 for the recovery of the two sums with which the appellant was surcharged, namely, rs. 1,984.70 being the expenses incurred for the construction of the unauthorised dam and rs. 535.82 being the legal expenses incurred with respect to the above construction work. in the suit, the panchayat represented by the present president impleaded not only the appellant but also certain other individuals who were members of the panchayat in the relevant time and also the legal representatives of a deceased member. the appellant and other defendants put forward various defences to the action for the recovery of the amounts. their principal defence.....
Judgment:

V. Balasubrahmanyan, J.

1. The appellant, Kamalinga Kalingarayar, was a former President of the Vadakkur South Village Panchayat from February, 1961 to February, 1965. The appellant, functioning as President of the Panchayat, along with the other members constructed a dam or weir on a drainage channel in the village, spending monies from out of the panchayat funds. This construction work was subsequently declared by the Executive First Class Magistrate, Thanjavur, as unauthorised. He also ordered demolition of the dam. The appellant took the matter in revision before this Court, but without success. He then filed a regular suit, O.S. No. 370 of 1963 against the Magistrate, the State of Madras and others for a permanent injunction against the demolition of the dam. He also filed an application for an interim injunction. The application was dismissed. But the appellant took the matter to the District Court, where the order was reversed. But on further appeal by the opposite parties, this Court restored the order of the trial Court. Meanwhile, the appellant filed another suit in O.S. No. 426 of 1964 on the very same cause of action and filed an interlocutory application for an interim injunction. But this application was also dismissed. The appellant took the matter to the District Court. Later, both the suits for injunction were dismissed with costs. The legal expenses for the conduct of the suit and other proceedings were found from the funds of the panchayat. The Tahsildar, Orathnad under orders of the Collector removed the appellant from the office of the president of the panchayat. The Executive Officer of the panchayat made an audit of the panchayat accounts. He found that a sum of Rs. 1,984.70 was incurred towards the construction of the unauthorised dam. He further found that a sum of Rs. 535.82 was expended by the appellant towards legal charges and fees as respects the several legal proceedings filed by the appellant arising out of the unauthorised construction of the dam. The Collector called for an explanation from the appellant with reference to the irregularities disclosed by the audit. The appellant did not respond to the notice. In consequence, the Revenue Divisional Officer, Thanjavur, issued orders on 28th May, 1965 requiring the new president to take steps to recover the amounts which were surcharged against the appellant as the person who had unauthorisedly incurred those expenses. The panchayat also passed resolutions for the filing of the suit and for recovering the amount. The Collector of Thanjavur gave sanction for the filing of the suit. The suit was actually filed on 12th June, 1967 for the recovery of the two sums with which the appellant was surcharged, namely, Rs. 1,984.70 being the expenses incurred for the construction of the unauthorised dam and Rs. 535.82 being the legal expenses incurred with respect to the above construction work. In the suit, the panchayat represented by the present president impleaded not only the appellant but also certain other individuals who were members of the panchayat in the relevant time and also the legal representatives of a deceased member. The appellant and other defendants put forward various defences to the action for the recovery of the amounts. Their principal defence however was that the suit was barred by limitation.

2. The learned District Munsif rejected all other contentions of the appellant and other defendants on merits. On the issue as to limitation, however, the learned District Munsif held that since the suit was filed on 12th June, 1967, all claims against the appellant and other members of the panchayat arising prior to 12th June, 1964 would be barred by limitation. According to the learned District Munsif, the cause of action for recovery of the amounts arose in July, 1962 when the dam was constructed. He held that the cause of action for the recovery of money unauthorisedly spent on such construction must be held to have arisen only at that time. Hence, the suit should have been filed within three years from the said date.

3. As for the claim for recovery of amounts that had been spent towards legal charges, the learned District Munsif held that the expenses incurred prior to 1964 cannot be recovered. He however held that amounts which were spent subsequently were not barred by limitation. He dissected the legal expenses and found that out of the total expenses incurred towards legal charges amounting to Rs. 535.82, expense amounting to Rs. 119.25 were well within the period of limitation. He accordingly decreed the suit only to this extent of Rs. 119.25 with proportionate costs. Against this decree, the panchayat appealed. The only question argued in the appeal was, whether the suit was barred by limitation in respect of the amount claimed by the panchayat other than Rs. 119.25 for which the trial Court had passed a decree? The learned Subordinate Judge disagreed with the District Munsif that the suit was barred by limitation with reference to some of the items claimed by the panchayat. He did not agree with the view that the cause of action relating to the claim for recovery of unauthorised expenses in connection with the construction of the weir arose only in July, 1962, when the weir was constructed. In his view, at the time when the expenses were incurred, the appellant was the president of the panchayat and the other defendants were also members of the, panchayat and all of them were parties to the said construction and expenses connected therewith. In such an event, it was unthinkable that any of them acting for the panchayat would have filed a suit for recovery of the very expenses which they had incurred in the name, of the panchayat. On this basis, the learned Subordinate Judge held that the cause of action for recovery of these amounts from the appellant and other members of the panchayat could only be said to arise after the new panchayat came to be constituted. He referred to the limitation provisions Contained in Section 173(2) of the Tamil Nadu Panchayats Act. 1958, which prescribed a three years period of time for filing a suit for recovery of the, amount surcharged against the president and other members of the panchayat. The learned Subordinate Judge held that this three years' period must be computed from the date when the new panchayat assumed office. In construing Section 173(2) of the Act in this manner, he relied on the principle laid down by the Full Bench of this Court in Subbiah Thevar v. Samiappa Mudaliar : AIR1938Mad353 . The learned Subordinate Judge found that after removal of the appellant a new panchayat was constituted and the president and other members of the new panchayat assumed office only in February, 1965. He accordingly held that the cause of action for the suit arose only in February, 1965 on the basis of which the suit filed in 1967 was well within the period of limitation. He, therefore, modified the decree of the lower Court and granted a decree in favour of the plaintiff for the entire amount for which the, suit claim was made against the appellant.

4. In this second appeal brought by the appellant, the only question argued is one of limitation. Mr. R. G. Raj an for the appellant could not and did not contest the finding of the trial Court that the amount spent by the appellant as president of the panchayat for the construction of the weir and for incurring legal expenses were unauthorised, improper and illegal. Learned Counsel how-ever referred me to Section 173(2) of the Tamil Nadu Panchayats Act, 1958. This provision prescribes the period of limitation to enforce the liability of the president, the executive authority and other members of the panchayat for loss, waste or misapplication of any money or property of the panchayat where such loss, waste or misapplication was a direct consequence of their neglect or misconduct. Section 173(1) provided that a suit for compensation may be instituted against the president, executive authority and members of the, panchayat in any Court of competent jurisdiction by the panchayat with the previous sanction of the Inspector in respect of the liability for loss waste or misapplication of funds or property. Section 173(2) prescribed the period of limitation in the following terms:

Every such suit shall be commenced within three years after the date on which the cause of action arose.

5. There is no dispute that this provision prescribes the period of limitation and since this is a special Act, the prescription in this section would prevail over the general provisions of the Limitation Act, in view of the saving provision of Section 29(2) of that Act. The question, however, is to decide the date on which the cause of action must be held to have arisen for the purpose of the present suit for recovery of the money from the the appellant and other members of the panchayat. According to the trial Court, the cause of action for this suit must be held to have arisen on the date when the weir or dam was built by the appellant out of panchayat funds. According to the learned Subordinate Judge, however, there could be no cause of action at all which could be said to arise, so long as the appellant himself was secure in his office as president of the panchayat, for it would be beyond contemplation that he would file a suit against himself, surcharging himself and recover the money from himself.

7. Mr. R. G. Rajan, learned Counsel however submitted that there was no room for introduction of this theory of impossibility of the cause of action arising on the date when the impugned transaction took place. The section according to him plainly stated that the period of limitation must run from the date on which the cause of action arises. The section did not say that the, date of arisal of the cause of action should be postponed merely on the score that the person against whom the suit should be filed him-self occupied the head of the administration of the panchayat.

7. I am, however, unable to accept this submission of learned Counsel. Under the Tamil Nadu Panchayats Act, 1958, a panchayat is constituted for a vilage specified by the Government. The panchayat shall be a body corporate and known by the name of the village concerned. It shall have perpetual succession and shall have the capacity of suing or being sued in its corporate name, of acquiring, holding and transferring property, movable or immovable, of entering into contracts, and of doing all things necessary, proper or expedient of for the purposes for which it is constituted. The panchayat is to consist of several members, all of whom are to be, elected. The president is to be regarded as the executive authority of the panchayat. His function would be to carry out the resolutions of the panchayat and discharge other duties imposed on him by the Act. Under Section 17(1) the term of office of the members of every panchayat, including the President, Vice-President and other office-bearers shall be five years from the date on which the vacancy occurred in which they are fitted in. This short summary of the provisions relating to the constitution of the panchayat and the President and other office-bearers and their tenure of office would show that their position is one of public trust and responsibility. It is further seen that once elected, the President and other office-bearers and other members of the panchayat shall continue to hold that office for a period of five years unless their tenure is terminated either by dissolution or supersession of the panchayat or otherwise on charges of misconduct.

8. Mr. R. G. Rajan's thesis was that in a suit against a panchayat president or other member it should be filed within three years, the cause of action being held to arise on the very date on which the misapplication or loss caused by the president arises. Since in practice it is the president as the executive authority who should move in the matter and since he would have normally a term of five years, in practice, no such suit would be filed if the misapplication etc., are made within the first two years of the office of the panchayat president. Mr. R. G. Rajan's argument in effect comes to this that a president can misapply funds, cause loss and do anything and play ducks and drakes with the funds of the panchayat for the first two years and if these things are not found out for the whole term of his office, then the suit against him would get automatically barred. Having regard to the importance of the office of the president of the panchayat in the local administration and the fact that it is a position of a public trust, I am unable to agree that the erring office-bearers should be allowed to go scot-free or to break the law with impunity in a too liberal rendering of the limitation provision. I agree with the learned Subordinate Judge in holding that the principle enunciated by the Full Bench, as a matter of construction of a similar provision in the, Limitation Act, must be adopted for the purpose of Section 173(2) of the Panchayats Act. In Subbiah Thevar v. Samiappa Mudadiar : AIR1938Mad353 , two questions arose for consideration; Whether Article 36 or the residuary Article 120 of the First Schedule to the Indian Limitation Act, 1908 would apply to a case of that kind. The Full Bench held that Article 36 related to suits for compensation for malfeasance, misfeasance or non-feasance independent of contract. The Bench held that this Article will not apply to suits against trustees. The, Full Bench held that Article 36 does not apply to wrongs committed by the trustees in respect of the trust and the only Article, which would apply is the residuary Article 120. Article 120 of the Indian Limitation Act, 1908 provided that a suit under that Article, for which no period of limitation was provided for elsewhere in the schedule must be filed within six years from the date when the right to sue accrues. The question before the Full Bench was as to when the right to sue accrued as against a sole trustee who was guilty of breach of trust. Leach., CJ., who spoke for the Full Bench observed as under:

It will be observed that Article 120 declares that limitation shall start to run when the right to sue accrues. There can be no cause of action until there is a party capable of suing and until there is a cause of action there can be no question of the law of limitation coming into operation....

The learned Chief Justice referred to some earlier cases and then continued as under:

It follows that if a sole trustee of a public trust commits a breach of trust the loss cannot be made good, without voluntary action on the trustee's part, until there is a new trustee. The right to sue in such a case would have to lie in abeyance until a new trustee was appointed, in which case the period of six years' limitation would not commence until a new trustee had been appointed. If there are other trustees who are themselves not liable, the period of limitation will start running immediately the loss is occasioned, because they will have in themselves the right to sue their co-trustee for the loss occasioned by him. Of course, if the co-trustees have also made themselves liable for the breach of trust, the position would be the same as in the case of a defaulting sole trustee.

The principle enunciated in the above passage, in my opinion, applies with equal force to a situation arising under Section 173(2) of the Panchayats Act which deals with the liability of the president, the executive authority and other members of the panchayat for loss, waste or misapplication of funds and property belonging to the panchayat. In the present case, it is common ground that the appellant as well as all the other members of the panchayat were responsible for the unauthorised expenditure of the funds of the panchayat. Although the minutes-book of the panchayat was not produced at the trial, from the other evidence before it, the trial Court had recorded a finding that the appellant as well as the other members of the panchayat participated in the resolution in and by which the panchayat passed the accounts relating to the expenses for construction of the weir and for payment of the legal fees. In these circumstances, when the panchayat council, as a whole, had been implicated in these matters, it would be beyond contemplation that any of them would have come forward for surcharging themselves or for filing a suit against themselves for recovery of the amount. It is, therefore, a classic example of a case, where the cause of action cannot be said to arise till those persons against whom the cause of action is said to arise cease to hold any office. This happened only in February, 1965. Hence, according to the principle laid down by the Full Bench in the case cited above, the, cause of action itself could not be said to arise till' the new panchayat came to office. I am, therefore, in entire agreement with the reasoning and conclusion of the learned Subordinate Judge and hold that the cause of action for the entire claim filed by the plaintiff arose only in February, 1965 and the suit, as a whole, with reference to the entire cause of action was well within time.

9. Mr. R. G. Rajan referred me in detail to some of the rules relating to surcharge, disallowance and the like. These rules are statutory rules. But a study of these rules does not support Mr. R. G. Rajan's contention that the cause of action must be held to arise the moment malfeasance or misfeasance occurred despite the fact that the entire body of the panchayat was involved. On the contrary, the relevant rules framed by the Government only go to show that the position which the panchayat president and other members occupied is one of public trust.

10. In the result, this appeal is dismissed and the judgment and decree of the Sub-Court are confirmed. The appellant will pay the costs of the first respondent-panchayat.


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