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1958 (5) TMI 48 - SC - Companies Law

Issues Involved:
1. Whether the suit was barred by limitation.
2. Whether the suit was barred under Order 2, Rule 2 of the Civil Procedure Code.

Issue-Wise Detailed Analysis:

1. Whether the suit was barred by limitation:

The primary contention was whether the suit filed by Raghunath Das was within the prescribed period of limitation. The High Court held that the suit was governed by Article 49 of the Indian Limitation Act, which provides a three-year limitation period for a suit for "other specific moveable property or for compensation for wrongful taking or injuring or wrongfully detaining the same." The High Court concluded that the suit was for the recovery of specific Government promissory notes (G.P. Notes) and, therefore, fell under Article 49. Consequently, the High Court dismissed the suit as barred by limitation since the plaintiff would be out of time even if the period between November 15, 1939, and March 15, 1945, was excluded.

However, the Supreme Court disagreed with the High Court's interpretation. It noted that the decree upon the award only declared the rights of the parties concerning the G.P. Notes and did not actually divide them. Until the G.P. Notes were divided by consent or by the court, neither brother could claim any particular piece of G.P. Notes as his separate property. Therefore, the suit could not be regarded as one for "specific moveable property." The Supreme Court held that the suit was essentially for partition or division of the moveable properties held jointly or as tenants-in-common and, thus, governed by Article 120, which provides a six-year limitation period.

The Supreme Court further held that Raghunath Das was entitled to the benefit of Section 14(1) of the Indian Limitation Act, which allows the exclusion of the time spent in prosecuting another civil proceeding in good faith in a court that was unable to entertain it due to a defect of jurisdiction. Since Raghunath Das had prosecuted the execution proceedings with due diligence and good faith, the period from November 15, 1939, to March 15, 1945, should be excluded. Therefore, the suit was filed well within the prescribed period of limitation.

2. Whether the suit was barred under Order 2, Rule 2 of the Civil Procedure Code:

The High Court did not address this issue as it had already dismissed the suit on the ground of limitation. However, the Supreme Court remanded the case back to the High Court for determination of this issue. The Supreme Court noted that the Subordinate Judge had held that the cause of action in the earlier suit for the recovery of the sum of Rs. 7,310-11-3 was not the same as the cause of action in the present suit and, therefore, the present suit was not barred under Order 2, Rule 2 of the Civil Procedure Code.

Conclusion:

The Supreme Court allowed the appeal, set aside the judgment and decree of the High Court, and remanded the case back to the High Court for a decision on the issue of whether the suit was barred under Order 2, Rule 2 of the Civil Procedure Code. The appellant was awarded the costs of the appeal and the costs of the hearing in the High Court resulting in the decree under appeal. The general costs of the appeal and the costs of further hearing on remand were to be dealt with by the High Court.

 

 

 

 

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