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TMI Blog1965 (8) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... nsideration in this appeal, which are of general and considerable importance, and not free from difficulty, it is necessary and we shall refer to the facts leading up to the present appeal. The Hanuman Bank Ltd. (in liquidation) was incorporated as a public limited company under the Indian Companies Act, 1913. The subscribed J and paid up capital is stated to be Rs. 5,75,000 and Rs. 4,31,000 respectively. It is needless to refer to the circumstances leading to the creditor's petition for winding up, which was presented on July 26, 1947. A provisional liquidator was appointed on August 19, 1947, and the final order, directing the bank to be wound up, was passed on November 5, 1947. By an order dated January 12, 1948, the present respondents, Messrs. Brahmayya and Company, were appointed the official liquidators. The lather of the present appellants, one Dewan Bahadur Swaminatha Iyer, a retired Chief Engineer of the Madras Government, was a director of the bank, and, according to the liquidators, intimately connected with the management of the bank, till its crash. While, under article 52 of the articles of association of the bank, the general supervision and control of the busines ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ank by reason of improper loans and advances was estimated at about Rs. 11,12,947. In all, under three counts, the loss to the bank was totalled at Rs. 14,08,647. The liquidators initiated proceedings under section 235 of the Indian Companies Act, 1913, by way of misfeasance summons in Application No. 2826 of 1960 against the directors and officers of the bank, charging the respondents therein with acts of misfeasance, misapplication of funds, breach of trust, etc. The enquiry in the application was protracted, and when arguments on the application were coming to an end, and no orders had been passed, Swaminatha Iyer above referred died on August 16, 1959,. On his death, following the decision of this court in Peerdan Juharmal Bank Ltd., In re [1958] 28 Comp. Cas. 546 , i t was held that the application under section 235 of the Companies Act could not be continued against the legal representatives of Swaminatha Iyer in those very proceedings. In Peerdan Juharmal Bank Ltd. s case ( supra ) the question directly arose for consideration, whether proceedings initiated under section 235 of the Indian Companies Act against a director of a bank ordered to be wound up could b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n law are preliminary and go to the root of the matter. Apart from challenging the factual basis on which the claim is made, and questioning the liability of Swaminatha Iyer himself in law, the appellants, who are the legal representatives of Swaminatha Iyerj contend, inter alia , that, in a case of the present kind, the cause of action does not survive the death of the director against his estate. It is further contended that the claim preferred in 1963, assuming that it is otherwise tenable, is hopelessly barred by limitation. There is also a plea that the dismissal of Application No. 2826 of 1950 would bar the present proceedings. The propriety of challenging the release deed executed by Swaminatha Iyer, which would properly come under section 53 of the Transfer of Property Act, by an application under section 45B of the Banking Companies Act, was also questioned. So far as the validity of the deed of release executed by Swaminatha Iyer is concerned, it is agreed before us by the counsel for the official liquidators and the counsel for the appellants, that this question may be left over for consideration, if and when the bank in liquidation makes out its claim against the est ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Banking Companies Act. The learned judge negatived the contention of the appellants that the claim against them as legal representatives of Swaminatha Iyer was barred by limitation, holding that the cause of action against the legal representatives arose only after the death. It was held that clause ( i ) of section 45-O of the Banking Companies Act would save it and that the claim was within time. Now, in this appeal before us, though the memorandum of grounds raised a number of contentions, the arguments were confined to two principal contentions, namely, ( i ) the extinction of the cause of action with the death of Swaminatha Iyer, and ( ii ) the bar of limitation, the entire claim being out of time. When the appeal was opened, Mr. S. Swaminathan, learned counsel appearing for the respondent-official liquidators, raised a preliminary objection to the maintainability of the appeal. In the memorandum of the grounds of appeal, as preferred, the provision of law under which the appeal was preferred was indicated as clause 15 of the Letters Patent. However, when the appeal was taken up, after due notice to the respondents, an application in C. M. P. No. 8004 of 1965 was t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l is provided for from "any order or decision" and that "decision " meant only a pronouncement or determination on a controversy. In our view, there is nothing to limit the scope for appeal under section 45N of the Banking Companies Act to a decree or final order, as contended by the learned counsel for the liquidators. The fact that Part III-A is headed as "Special provisions for speedy disposal of winding up proceedings" cannot control the plain language of the section and take away a valuable right of appeal, which the words convey. The object, it is seen, is achieved in many ways, without encroaching on the provisions as to appeal. The headings in an Act of Parliament may be resorted to only to resolve any ambiguity in the words, but the effect of the plain words of a section, if there is nothing incongruous in their application according to their ordinary meaning with the rest of the provisions of the Act, cannot be curtailed by reference only to the heading. To a certain extent, the right of appeal is curtailed by the requirement as to value in the section itself. Then the jurisdiction under section 45B is exclusive and all embracive, and the exclusive jurisdiction to enter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... specifically made decisions also, appealable; and the preceding word "any" has also to be given its due force in the context. The right of appeal conferred is a substantial and valuable right and the court should be slow to limit and cut down the prima facie operation of the words if it could be avoided. The only limitation that could be placed on the words in the context is that the order or decision should not be merely procedural in character, and that is the limitation that has been placed on these words as they occurred in section 202 of the Indian Companies Act, 1913 (section 453 of Act 1 of 1956). Section 202 of Act VII of 1913 ran thus: "Re-hearings of, and appeals from, any order or decision made or given in the matter of the winding up of a company by the court may be had in the same manner and subject to the same conditions in and subject to which appeals may be had from any order or decision of the same court in cases within its ordinary jurisdiction. " One argument on this provision for appeal had been that any order or decision to be appealable must, in view of the later provisions in the section, satisfy the requirements of clause 15 of the Letters Patent. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... observed: "But section 202 is general in its nature and it provides for appeals against any order or decision made or given in the matter of the winding up of a company. Therefore, the first fact which strikes one is that the legislature attached particular importance to the winding up of a company and made orders, made in the course of the winding up, subject to appeal Another important fact that must be borne in mind in construing section 202 is that it is not only any order in the matter of the winding up which is made appealable, but every decision in the matter of the winding up, and the importance of its being made appealable can be realised from the fact that under section 199 the Act provides that all orders made by a court may be enforced in the same manner in which decrees of such court made in any suit pending therein may be enforced. Therefore, the legislature; knew the distinction between an order and a decision, and whereas section 199 talks of how an order should be enforced, section 202 does not limit the right of appeal merely against an order, but also confers that right of appeal against a decision. In our opinion, the right conferred is not only a substantial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in appeal there, were proceedings under section 235 of the Indian Companies Act, and not proceedings under the Banking Companies Act; and all that was laid down in that decision was that the right of appeal conferred by section 45N was limited to orders in original civil proceedings contemplated by the Banking Companies Act, and did not extend to orders passed in civil proceedings u nder the Indian Companies Act. Mr. V.K. Thiruvenkatachari, learned counsel for the appellants, contended that the order appealed against in the present case would also be a judgment under clause 15 of the Letters Patent. The definition of a judgment under the Letters Patent, as enunciated in Tuljaratn Ro w v. Alagappa Chettiar [1912] ILR 35 Mad. 1 (FB) was relied upon, and it was submitted that the definition of judgment in Tuljaram's case ( supra ) has been adhered to by this court ever since. There has been a conflict between the various High Courts as to the meaning of "judgment" under clause 15 of the Letters Patent, and this conflict is noticed by the Supreme Court in Asr umat i Debt v. Kumar Rupendra Deb Rajkot [1953] SCR 1159, Shankarlal Aggarwala v. Shankarlal Poddar [196 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceeding is pending is concerned, or if its effect, if it is not complied with, is to put an end to the suit or proceeding, I think the adjudication is a judgment within the meaning of the clause. An adjudication on an application which is nothing more than a step towards obtaining a final adjudication in the suit is not, in my opinion, a judgment within the meaning of the Letters Patent." The learned Chief Justice, while discussing the observations of Sir Richard Couch C.J. in Justices of the Oriental Gas Company s case ( supra ), was not prepared to say that, in order that a decision could be a judgment, it must be one which affects the merits by determining some right or liability; but, according to the learned Chief Justice, whatever its form it must terminate the suit or proceeding. However, in Tuljaram's case ( supra ) Krishnaswami Aiyar J. observed: "But I do not think we shall be justified in confining the term judgment' to final disposal of suits, appeals or original petitions or proceedings in execution. Preliminary or interlocutory judgments which ascertain rights and direct further enquiries which determine liabilities though further directions are given fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er it terminates the suit or proceeding; and ( ii ) Whether it affects the merits of the controversy between the parties in the suit itself. This two-fold requirement of a judgment under the Letters Patent is re-stated again in another Full Bench case of this court in Southern Roadways v. Veeraswatni Nadar [1964] 1 MLJ 25 (FB) , whe re it is observed at page 29 that the decision in Asrumati Debt v. Kumar Rupcndra Deb Raikot [1953] SCR 1159 substantially proceeds on the basis that an order by the court which relates to a suit, but which has the effect of keeping that suit alive cannot be regarded as a final judgment. Again in Cork Industries v . Govindarajulu Mudaliar [1964] 2 MLJ 265 this court has held that though an order would be a "judgment" against which an appeal is maintainable under clause 15 of the Letters Patent, the same cannot follow in regard to an order granting leave. In this state of the law, as the present appeal could, in our opinion, be sustained under section 45N of the Banking Companies Act, it is needless to examine the tenability of the appeal under the Letters Patent or the further question whether an appeal outside section 45N is open in civil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had gained for himself any pecuniary advantage, it is argued that forms of action for recovery based on the theory of unjust enrichment have no application. Strong reliance is placed on the scope of the maxim actio personalis mor itur cum persona stated by Bowen L.J. in Phillips v. Homfray [1883] 24 Ch. D. 439, 444 thus: "The only cases in which, apart from questions of breach of contract, express or implied, a remedy for a wrongful act can be pursued against the estate of a deceased person who has done the act, appear to us to be those in which property or the proceeds or value of property, belonging to another, have been appropriated by the deceased person and added to his own estate or moneys. " Elaborating the arguments, learned counsel covered a wide field, referring to the development of the law relating to liability in torts, the distinction between actions on contract and actions on tort, between implied contract and what is commonly referred to as quasi contract, and actions based on the obligations in the nature of trusts, provided for under Chapter IX of the Indian Trusts Act, referring particularly to section 88 of Indian Trusts Act. The arguments principall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the funds of the bank, the improper outlay of the funds, and unlawful advances contrary to rules and regulations, could come either as breaches of contract, implied, if not express, or, at any rate, as breach of trust, or under quasi contract, and that in such cases the estate of the wrongdoer would be liable. Learned counsel argues that the maxim actio personates moritur cum persona is limited to personal wrongs arising. out of tort, and does not relate to the liability arising out of breach of trust, express, implied or constructive. It is submitted that the relationship between the director and the bank, apart from being contractual, was also fiduciary, and that any actionable negligence in respect of fiduciary obligations would be outside tort. Learned counsel points out that the liability in this case was sought to be made out not on negligence simpliciter of Swaminatha Iyer. As set out already, in the report filed by the liquidators in support of the application, averments are found that the managing committee, of which Swaminatha Iyer was a member, had toll control of the business of the bank carried on by the managing director, and that Swaminatha Iyer had a prepon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was relied upon. The other case was a suit for damages for malicious prosecution. It should be noticed that Act XII of 1855 does not permit the continuance of an action, which has been commenced against the wrongdoer himself in his lifetime. In Rustomji D orabji v. Nurse [1921] ILR 44 Mad. 357 (FB) where it became necessary to refer to a Full Bench the question, whether in a suit for malicious prosecution, if the' defendant died more than a year after the prosecution in question, and before judgment, the right to sue survived within the meaning of Order XXII, Rule 1, of the Civil Procedure Code, so as to prevent abatement of the suit, on the order of reference, Wallis C.J. adverting to the maxim actio personalis moritur cum persona, observed thus : "That rule, which is of post-classical origin and is referred to in Pollock on Torts as barbarous, is far from embodying the principles of justice, equity and good conscience in so far as it deprives an injured party of redress if the alleged wrong-doer happens to die, as in the present case, before a decree has been obtained against him. It has not been applied to contracts, and has been limited by statute as regards torts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xcept also cases where, after the death of the party, the relief sought could not be enjoyed or granting it would be nugatory." It will be seen that while Act XII of 1855 enacted the survival of the right to sue for all kinds of tort, section 268 of the Indian Succesaion Act excluded causes of action for ( i ) defamation; ( ii ) assault under the Indian Penal Code; ( iii ) other personal injuries not causing the death of the party and (iv) cases where the relief sought could not be enjoyed or granting it would be nugatory (say, restitution of conjugal rights). As the Succession Act did not apply to Hindus, Mohamadans or Buddhists, a similar provision was enacted in the Probate and Administration Act, 1881, by section 89, which runs as follows: "All demands whatsoever, and all rights to prosecute or defend any suit or other proceeding, existing in favour of or against a person at the time of his decease, survive to and against his executors or administrators, except causes of action for defamation, assault as defined in the Indian Penal Code or other personal injuries not causing the death of the party, and except also cases, where after the death of the party the relief soug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts in which a defined word may be found." In the view we are ultimately taking as to the applicability of the maxim to a claim of the kind agitated in the present proceedings, it is unnecessary for us to consider further the applicability of section 306 to heirs. We have referred above to the statutory modifications of the rule in India, which, as is apparent, leaves much to be desired. The general rule at common law in England was that the maxim had no application to any breach of contract except breach of promise to marry. Several exceptions to the applicability of the maxim were introduced in England by statutes in the case of claims to property arising out of tort. The Administration of Estates Act, 1925, section 26(2) and (5), replacing 4 Edw. 3, c. 7, and the Civil Procedure Act, 1883, section 2, made considerable inroads on this rule by permitting actions to survive for the benefit of the estate if based on wrong to the deceased's real estate, and to survive against the estate if based on wrongs committed by the deceased to the property of other persons, subject in each case to a special period of limitation. There was the Fatal Accidents Act, 1846, commonly known as L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f much of our modern law of tort, began life with a strong quasi-criminal character and on that ground the action for it did not survive the death of either plaintiff or defendant. Nor did there appear to be any injustice in this. If one has the habit of looking on a wrong as something very like a crime, it is a natural inference that nobody ought to be liable for it except the man who committed it. True, the argument is not so strong where it is the plaintiff in trespass who dies. Why should not his successors sue the defendant if he is still alive ? The answer apparently is that the rule that an appeal perished, whether it was, the appellor or appellee who died, seems to have infected the law as to transmissibility of the action of trespass, and the infection passed from trespass to actions in tort generally,". The learned author, referring to the maxim actio personalis moritiur cum persona itself, observes at page 118: "The maxim is derived from neither Roman law nor the Canon law. Bracton was unjustly accused by a later generation of its parentage. Others have hinted that Coke invented it, but that is not so, though it is just the sort of thing that was a savoury bakemeat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t will give rise to a common law action for damages. Thus, although a breach of trust will often cause loss to beneficiaries, and breaches of trust are not permitted in equity, a breach of trust is not a tort; for, on the one hand, it gives rise to an equitable (as opposed to a legal) claim in the parties injured, and on the ether hand it is remediable by proceedings in the Chancery Division, and not by an action for damages at law." In Winfield on Tort, at page 7, it is stated thus: " The duty in tort is towards persons generally: The emphasis here is to be laid upon ' generally.' If the duty is towards a specific person or specific persons, it cannot arise from tort. There the duty is always general. Thus, I am under a duty not to commit assault, or battery, or any other tort against any one who can sue me in any court which can entertain the action. My duty not to commit a tort is not limited to John or to Mary or to any other named person or persons. This element of generality is an important factor in the definition and it is sufficiently workable in the majority of cases, but it must be admitted that in some instances it is hard to say who exactly are ' persons generall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. Obligations of trustees are included in this class. We are setting out this aspect of the matter to show that obligations of trustees are outside, delictal or tortious liabilities. In Paton's Jurisprudence, already referred to, in Chapter 14 dealing with rights directly created by law, the learned author states, at page 307; "The right of contract arises directly from a juristic act. Other rights are granted by the law, whether the person bound by the duty consents or not. The American Restatement contrasts three broad branches contract, tort and restitution. In contract the underlying postulate is that a person shall obtain what was freely promised ; in tort that a person has a right not to be harmed by an unlawful act; in restitution that a person has a right to have restored to him a benefit gained at his expense by another, if the retention of that benefit would be unjust. Since both in tort and restiturtion the rights do not arise from consent but are granted by the law, there will naturally be some overlapping of the boundaries in actual systems." It may be stated that, till the nineteenth century English law possessed no classification of personal actions, being c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made against the estate, cannot be different from the claim that could have been made against Swaminatha Iyer when alive, on the same cause of action. In this connection, reference is made to a decision of the Supreme Court in Andhra Bank Ltd. v. Srinivasan [1962] 3 SCR 391; [1963] 1 An . WR (SC) 14; [1962] 2 SCJ 676; [1963] 1 MLJ (SC) 14; AIR 1962 SC 232 At p age 19 of the report, after referring to the true legal position under section 52 of the Code of Civil Procedure, and Order 22, rule 4, sub-rule (2), of the Code of Civil Procedure, which provides that the defence which the legal representatives can make has to be appropriate to their character as legal representatives, it is observed: "That emphatically brings out the character of the contest between the legal representatives and the appellant. The appellant in substance is proceeding with its claim originally made against the deceased Raja Bahadur and it is that claim which respondents Nos. 2 to 12 can defend in the manner appropriate to their character as legal representatives." Their Lordships referred, with approval, to the statement in Salmond's Jurisprudence on this aspect of the matter, that: "Inheritance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1954 Mad. 113. But, in our view, it is unnecessary to consider, whether the articles, particularly relating to the directors and the managing committee referred to in the report of the liquidators in support of their application, constituted a contract between the concerned directors and the company. It is sufficient for our purpose to hold that the management of the business was vested in the managing committee and the managing committee had control over the funds of the bank. The cause of action relied upon is not mere negligence, but a breach of duty, specifically undertaken by accepting the office as director and a member of the managing committee. Reference was made by learned counsel for the appellants to Letang v. Cooper [1964] 2 All. ER 929 , pointing out that the tort of negligence is firmly established. Certain observations in the decision were referred to, but we find that they are of little help to the appellants in the present case. The question there was as to the applicability of the provisions of the Law Reform (Limitation of Actions, etc.) Act, 1954, which ran thus: "Provided that, in the case of actions for damages for negligence, nuisance or breach of dut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ally be liable for breach of contractual duty. In addition the defendant is under a great duty in tort to exercise a proper degree of skill and care wherever failure or omission is likely to cause physical injury to persons or property ... Where the prospect of physical injury is absent, the duty to exercise skill is only contractual, as with accountants, architects and surveyors, auctioneers, bankers, company directors, insurance brokers ..." It was pointed out that the recent case of the House of Lords in Hedley Byrne Co. Ltd. v. Heller Partners Ltd. [1963] 2 All. ER 575; [1964] 34 Comp. Cas. 96 (HL) established that there was no distinction between cases in which there is a prospect of physical injury and cases in which there is a prospect of financial loss. Learned counsel pointed out that even when financial loss is caused, and there is no physical injury, the liability could be in tort. Our attention was drawn to the Cumulative Supplement {1964), to the third edition of Halsbury's Laws of' England, where, with reference to the passage in Halsbury's Laws of England above cited, the Supplement states as follows (for paragraph 17 of volume 28): "There is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the latter, the liability of the person follows his estate, on his death. Though directors may not be express trustees, they are in the position of trustees, and their office is fiduciary. Section 88 of the Indian Trusts Act (2 of 1882) emphasises the fiduciary ) character of the director of a company. It provides that, where a trustee, executor, partner, agent, director of a company, legal adviser, or other person bound in a fiduciary character to protect the interests of another person, avails himself of his character, and gains for himself any pecuniary advantage or, where any person so bound enters into dealings under circumstances in which his own interests are, or may be, adverse to those of such other person, and thereby gains for himself a pecuniary advantage, he must hold for the benefit of such other person the advantage so gained. While, under section 88, a person in a fiduciary position, who had gained an advantage to himself, would be compelled to disgorge the gain, so as to benefit the person whose interest he was fiduciarily bound to protect section 95 of the Indian Trusts Act equates his position to that of a trustee in respect of his liabilities and disabilities ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ors are called trustees. They are no doubt trustees of assets which have come into their hands, or which are under their control..." At page 518, the learned author states: "For most purposes it is sufficient to say that directors occupy a fiduciary position and all the powers entrusted to them are only exercisable in this fiduciary capacity." No doubt, as pointed out by Palmer, the fiduciary relationship of a director exists with the company; a director is in no sense a trustee for individual shareholders. Passages to similar effect are found in Buckley on the Companies Acts, thirteenth edition. At page 864 it stated: "The directors of a company fill a double character. They are ( i ) agents of the company, and ( ii ) trustees for the shareholders of the powers committed to them." Expanding the latter, at page 865, instances of the powers are given, as, for instance, of the power of approving transfers of shares; of the power of allotment of shares; of the power of employing the funds of the company; of the power of making calls; or receiving payment of calls in advance; of the power of forefeiting shares, etc., and it is pointed out that as trustees they may be ren ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... forty-first edition, at page 374, it is stated: "In the case of the death of a director his estate remains liable for any breach of trust he may have committed (including any wrongful dealing with the company's property, such as a payment of dividend out of capital or sale of its assets at an undervalue)." The distinction as to cases in which there is no survival of causes of action is found at page 182 of the book, where it is stated: "In regard to actions for deceit and other wrongs, the principle actio personalis moritur cum persona may be mentioned. Under this principle, with regard to actions for wrongs, independent of contract, done either to or by a deceased person in his lifetime, his legal personal representative could neither sue nor be sued. This is still so in some cases, e.g., defamation. Even at common law this principle is subject to the modification that where loss results to the estate of the plaintiff or direct profit to that of the defendant, the action survives to the extent of the loss or profit." In Williams on Executors and Administrators, fourteenth edition, volume 2, referring to the liability of the executor or administrator in respect of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sentatives." Section 333 of the English Companies Act, 1948, corresponds to the old section 165, there, that is, section 235 of the Indian Companies Act, 1913, or section 543 of the present Companies Act. The liability which is enforced Under the summary procedure by these sections, and that is the liability that is sought to be agitated in the present proceedings, the learned author points out, is not in tort, but on a different footing. Of course, as pointed out by the learned author, at page 1017, the procedure by summons may not survive the death. In Flitcroft's case ( supra ), the directors of a limited company for several years presented to the general meetings of shareholders reports and balance-sheets in which various debts known by the directors to be bad were entered as assets, so that an apparent profit was shown though in fact there was none. The shareholders, relying on these documents, passed resolutions declaring dividends, which the directors accordingly paid. An order having been made to wind up the company, the liquidator applied under section 165 of the Companies Act, 1862, for an order on the directors to replace tile amount of dividends thus paid out of c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cept in certain cases enumerated, in a sub-ordinate clause, namely, where the claim was founded on fraud or when it was to recover trust property, retained by the trustee or converted to his use, This section was not confined to express trustees. In Ramskill v. Edwards [1885] 31 Ch. 100 , the directors of a company advanced some Honeys of the company upon an unauthorised security, and two sums so lent were lost. One of the directors, against whom a judgment had been obtained by the company for the amount lost, commenced the action claiming contribution from his co-directors and the administrator of one of his co-directors, who had died since the issue of the writ. On behalf of the deceased director the claim for contribution was sought to be met with the plea that inasmuch as the director was dead, his estate could not be made. liable. Pearson J. overruled the objection observing: "It was undoubtedly a bold contention, and if it succeeded, the result would be that any defaulting trustee would have only to die, and his estate would cease to be liable for his misfeasance. Not only is there no authority for such a proposition, but it seems to me that it would be most pernicio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r persons, it is by no means easy-to do so, and these considerations have induced the courts to treat a, misapplication of the money of a company by its directors as a breach, of trust to which the Statute of Limitations has no application at least while they are directors: see Flitcroffs case ( supra ), which is a dear decision of this court on this very point. The liability of a director, in the case supposed being treated as a breach of trust, I apprehend that the Statute of Limitation would not apply, even after a director had ceased to be a director." At page 170 of the report, there is a further observation, in considering what interest should be awarded, that: "The trustee is treated as if he had the funds still in his hands." In In re Faure Electric Accumulator Company [1889] LR 40 Ch. D. 141 , it is observed that of the directors of a limited company apply the money of the company for purposes so outside its powers that the company could not sanction such application, they may be made personally liable as for a breach of trust but if they apply the money of the company, or exercise any of its powers, in a manner which is not ultra vires , then a strong and clea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [1878] LR 10 Ch. D. 450, that the directors "are no doubt trustees of assets which have come into their hands, or which are under their control, but they are not trustees of a debt due to the company". The case, Concha v. Murrieta [1889] LR 40 Ch. D.. 543, though not a case of directors of a company, effectively illustrates the scope and limitation of the maxim. It related to the estate of a father who, under the law of Peru, was entitled to administer the estate of his infant child, and to receive for his own benefit the income during the child's minority. It was alleged in the case that the father, during the infancy of his daughter, improperly sold a part of her property for much less than it proved to be worth. After his death the daughter claimed compensation out of his estate for the loss occasioned by the disadvantageous sale. It was held that the father stood in such a fiduciary position towards the daughter that the rule actio personalis moritur cum persona did not apply to the demand, and that, as the sale tad been made without justification, the father's estate must account for the amount which would have been received from the property had it been retained in s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entitled to the benefit of the Statute of Limitations which was passed for the benefit of trustees. I cannot be a party to any decision so supremely absurd. Although directors are not properly speaking trustees- yet they have always been considered and treated as trustees of money which conies to their hands or which is actually under their control; and ever since joint stock companies were invented directors have been held liable to make good moneys which they have misapplied upon the same footing a if they were trustees, and it has always been held that they are not entitled to the benefit of the old Statute of Limitations because they have committed reaches of trust and are in respect of such moneys to be treated as trustees." Kay L.J. observed at page 638: "Now, case after case has decided that directors of trading companies are not for all purposes trustees or in the position of trustees, or quasi-trustees, or to be treated as trustees in every sense; but if they deal with the funds of a company, although those funds are not absolutely vested in them but funds which are under their control, and deal with those funds in a manner which is beyond their powers, then as to that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this liability to the representatives of a person who stood in a fiduciary position, even where the estate has not been benefited by the breach of trust Walsham v. Stainton [1986] 1 DG J. Sm. 678 . It was urged on behalf of Sakerchand Nagerdas (the deceased director) that this liability, if any, did not survive his death as a charge on his assets, because it was, at the most, a mere personal default productive of no benefit to his estate. Two well- known cases were cited in support of this contention- Overend, Gurney Company v. Gurney [1869] LR 4 Ch. D. App. 701 and Peek v. Gurney [1873] 6 HL Cas. 377, 393. But neither of those cases are on all fours with the present case. In the first case Lord Hatherley, in his judgment, says that he would have decided differently if the charge had been one of a breach of trust in the disposal of money actually entrusted to the care of the defendants. In the second case Lord Chelmsford, in his judgment, expressly stated that the case before him was not one of bread of trust, but of inducing people to subscribe by deceit and misrepresentation. The present case is one distinctly of breach of trust; and the English law is clear on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st others, for the proposition that the misfeasance of a director was a breach of trust. Again in Malik v. Thiruvengadaswa mi Mudaliar [1885] ILR 9 Bom. 373 , another Division Bench of this court has relied upon the above case, New Fleming Spinning and Weaving Company Limited v. Kessowji Naik [1949] 19 Comp. Cas. 311. There the question arose whether, where a director is ordered to pay in misfeasance proceedings a sum of money, he can be arrested in execution proceedings, though he was a pauper and was quite unable to raise the money to discharge the decree. This court held that the director of a company occupied a fiduciary position with regard to the members of the company, and relied upon the above cases of New Fleming Spg. Wvg. Co. Ltd. s case ( supra ) and Ramaswami v. Streeramulu Chetty [1896] ILR 19 Mad. 149. Our attention has not been drawn to a single case where a claim against a director, based on a breach of trust, has been held not to survive against his estate in the hands of his legal representatives. In Phillips v. Homfray [1883] LR 24 Ch. D. 439, 454 , the cause of action was in tort, and there was no pre-existing fiduciary relationshi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case arose out of a suit by a bank against two directors of a branch office for compensation for misconduct in sanctioning a loan in violation of the rules. Pending the suit, one of the directors died, and the contention was raised by the sons, who had been brought on record as legal representatives, that the right to sue did not survive against them. It was urged that the suit was really for compensation for loss alleged to have been suffered by the bank due to tortious acts, independent of contract, committed by the deceased director. Jai Lai J., dealing with this contention, observed: "In the first instance, I do not agree that the suit is for compensation merely for a tort committed by Hargopal. It is a suit for breach of a fiduciary obligation towards the bank by Hargopal and thus arises out of the breach of a quasi-contract. Hargopal was one of the local directors of the bank and according to the rules governing the conduct of the local directors he was not competent to sanction this loan and he defied those rules' fraudulently. Such rules must be deemed to be a contract between the bank and Hargopal. Secondly, it may be that, as was contended by respondent's counsel, acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y. The section does not give a right to continue proceedings against heirs as representing an estate ... The terms 'executors or administrators' are defined in section 2 of the Act. When terms are defined in an Act of the legislature, such terms must be given the meanings contained in the definitions wherever the terms are used in a statute, unless it is clear that they must be given some different meaning." In view of the decision of the Division Bench of this court, cited above, as to the limitations in the applicability of section 306 of the Indian Succession Act, we would rest our decision that the cause of action survives in a case like the present against the legal representatives on other grounds. The foundation of the liability is not on mere tort, but on the breach of fiduciary relationship, the failure to perform duties undertaken by a person j in the position of a trustee. The liability in such cases is as on a breach of trust or, as observed by Cotton LJ in Concha v . Murieta [1889] LR 40 Ch. D. 543 on breach of a, quasi-contract. Not being laid on tort, in the light of the foregoing discussion, the maxim actio personalis moritur cum persona does not apply t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Banking Companies Act against the representatives of the deceased director was filed on 25th January, 1963. Of the three counts, on which the claim is based, the first count, viz ., payment of dividends out of capital, is stated to be between the years 1941 and 1946. Misapplication of the funds of the bank, by utilising the same for the purchase of the Coorg Coffee Plantations Limited, is stated to have commenced from about 11th August, 1945, and continued till the crash of the bank. Under the third count, improper advances, fictitious advances of loans, by the managing director to cover up fraudulent abstraction of funds, etc., the liability starts, the earliest, from 8th March, 1945. There can be no doubt that prior to the Banking Companies Act, as the summary procedure under section 235 was not available against representatives, action against representatives would be governed by the law relating to the limitation of suits in such cases. It is only by virtue of the provisions of the Banking Companies (Amendment) Act (52 of 1953), which came into force on 30th December, 1953, giving exclusive jurisdiction to the High Court, that proceedings against representatives have bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r of a banking company which is being wound up or for the enforcement by the banking company against any of its directors of any claim based on a contract, express or implied; and in respect of all other claims by the banking company against its directors, the period of limitation shall be twelve years from the date of the accrual of such claims (or five years from the date of the first appointment of the liquidator, whichever is longer). (3) The provisions of this section, in so far as they relate to banking companies being wound up, shall also apply to a banking company in respect of which a petition for the winding up has been presented before the commencement of the Banking Companies (Amendment) Act, 1953." Part III-A, now current, in which section 45-0 is found, was brought in as an amendment of the Banking Companies Act, 1949, Act 52 of 1953 substituting the present Part III for the former Part III. Amended Act 52 of 1953 came into force on 30th December, 1953. The amending Act was preceded by an ordinance . Ordinance No. 4 of 1953, dated 24th October 1953, containing similar provisions. It is the interpretation of section 4S-O as found in the ordinance dated 24th October ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dded in respect of banking companies in Part X-A, and in 1946 the Banking Companies (Inspection) Ordinance came into force. In the same year was passed another Act, the Banking Companies (Restriction of Profits) Act. This was followed up by the Reserve Bank of India (Temporary Amendment) Ordinance, 1947, and then we got the Banking Companies Act X of 1949. This Act, entitled the "Consolidating and amending Act of the law relating to Banking Companies", provided by section 2 that the provisions of the Act shall be in addition to, and not, save as otherwise expressly provided by the Act, in derogation of the Companies Act and any other law for the time being in force. This has replaced Part X-A of the Companies Act. In the Banking Companies Act, as originally enacted. Part III-A, providing for certain special provisions for speedy disposal of winding up petitions, was not present. By Ordinance 23 of 1949, Part III-A, consisting of sections 45A to 45H, was first inserted in the Act on 19th September, 1949. This was later replaced by the Banking Companies (Amendment) Act of 1950, which came into force on 18th March, 1950. The Amending Ordinance of 1949 and the Amendment Act of 1950 int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court to entertain and decide any claim made by or against a banking company, which is being wound up. The non-obstante clauses in sub-clauses (1) and (2) of section 45-0 further emphasise the overriding effect of the provision as to limitation in Part III-A. Sub-clause (3) of section 45-O expressly states that the provisions of the section; in so far as they relate to banking companies being wound up, shall also apply to a banking company in respect of which a petition for the winding up has been presented before the commencement of the Banking Companies (Amendment) Act, 1953. The language is quite clear that the section applies to winding up proceedings in respect of a banking company, which were pending at the time the Act of 1953 came into force, having commenced on a winding up petition presented before the commencement of the Act. To take up first sub-clause (1) of section 45-O, it will be seen that, while the earlier Act 20 of 1950 provided for the exclusion of a period of one year, immediately before the date of the order for winding up, in the computation of the period of limitation, the effect of sub-clause (1) is to arrest the running of limitation after the pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o run, will, as a rule, continue to do so, even though subsequent events occur, which make it impossible that action should be brought, and which rule holds good with respect to all limitation enactments (vide Halsbury's Laws of England, third edition, volume 24, page 197, and section 9, Indian Limitation Act, 1908), sub-clause (2), in fact, while removing the limitation on certain actions, provides also a special period of limitation in certain cases. Directors of companies, who had been in a special position of privilege and responsibility in relation to the banking company, are placed in a special category, and limitation of claims against them are dealt with under this sub-clause. Sub-clause (2) deals with three classes of claims, namely, ( i ) recovery of arrears of calls from any director of a banking company which is being wound up; ( ii ) enforcememt by the banking company against any of its directors of claims based on, ft contract, express or implied; and ( iii ) all other claims by the banking company against its directors. With regard to claims falling under the first and second classes, all periods of limitation are ruled out. With regard to all other claims which co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is incongruity or repugnancy could be avoided only if sub-clauses (1) and (2) are held to be mutually exclusive. This argument, of course, would not be available in respect of sub-clause (2) as it stood prior to the amendment in 1959 . Ostensibly and statedly the effect of the amendment in 1959 of sub-clause (2) was to extend the period of limitation, and the Act applies not only to banking companies which are being wound up, but to companies which may get wound up in future. One can visualize, and it is not unlikely, the twelve-year period expiring just before the presentation of the winding up petition. In respect of such a claim sub-clause (1) would be of no avail, and only the amended provision of sub-clause (2) would enable the liquidator to take the necessary action in that case within five years of his appointment, the latter being a more favourable mode of computation. In such cases, as sub-clause (1) cannot come into play, there is no incongruity or repugnancy. When sub-clause (1) comes into effect, then the latter amended part of sub-clause (2), providing a period of five years from the date of the first appointment of the liquidator, will have no application, it being to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed he takes action within five years of the first appointment of the liquidator. As, in our view, the five-year period in sub-clause (2) would come into play only in cases where sub-clause (1) does not apply, there is no repugnancy or incongruity in construing sub-clauses (1) and (2) together as not mutually exclusive. There is nothing unreasonable, harsh or illogical in the view we are taking. Directors, who have been in the position of trustees, and themselves in control of the company and its funds, with opportunity to conceal their misdeeds and acts of misfeasance, are not entitled to claim a liberal interpretation in their favour of the provisions of the statute relating to limitation. We see no reason to depart from the true intent and purport of the section, as apparent from its plain language, and to exclude the operation of sub-clause (1) to the law of limitation prescribed in sub-clause (2). In our view, even against directors and their representatives, apart from the special provision of sub-clause (2), sub-clause (1) also would apply. The application of sub-clause (2) does not necessarily call for the exclusion of sub clause (1). In this view, any claim against a dire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her sub-clause (1) is applied or not. Sub-clause (3) provides for the application of the section to a banking company, which can only mean in respect of actions taken by a banking company. It can have no other meaning, as the whole of this section provides for suits and applications by a banking company which is being wound up. No doubt, the provisions of the section have to be construed on the general principle against the retrospective intendment of the statute to the prejudice of the subject. But it is undoubted that Parliament has jurisdiction by statute or amendment of statute to affect the subject even in respect of past transactions to its prejudice. It may, and often, does so, by words leaving no possibility of doubt. It can, in certain cases, be a matter of pure construction, and may be self-evident' from the language of the statute. The real question for consideration in all cases is whether Parliament has, on a proper construction of the statute, expressed or sufficiently implied its intention of giving a retrospective force to its Act. Undoubtedly, it is an accepted principle of our law that in the case of alteration of a substantive law, as opposed to a mere procedur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d M. C. Printing Co. v. S.G. Mehta [1963] 48 ITR (SC) 154, 170 the Supreme Court has observed thus: "The date on which the amendment comes into force is the date of the commencement of the amendment. It is read as amended from that date. Under ordinary circumstances, an Act does not have retrospective operation on substantial rights which have become fixed before the date of the commencement of the Act. But this rule is not unalterable. The legislature may affect substantial rights by enacting laws which are expressly retrospective or by using language which has that necessary result. And this language may give an enactment more retrospectivity than what the commencement clause gives to any of its provisions. When this happens the provisions thus made retrospective, expressly or by necessary intendment, operate from a date earlier than the date of commencement and affect rights which, but for such operation, would have continued undisturbed." If the clear language of sub-clause (3) of section 45-O, without mutilating its application, could be limited to claims which were alive on the date of the Act, the court should do so. But when the retrospectivity cannot be limited ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and post-partition period, that the procedure for the liquidation of joint stock companies was totally inadequate for the liquidation of banking companies in a manner satisfactory to the depositors. The committee constituted in 1950 found that 321 banks were in liquidation under the various courts, dating from 1926, with outside liabilities of about thirty crores of rupees. First the ordinance was promulgated on the 24th October, 1953, and later came the Act, 52 of 1953. The lacuna found in sub-clause (2) of section 45-0 was later removed by the amendment of 1959. Right through, it will be seen that the legislative effort had been to extend the period of limitation in favour of the bank, and there is nothing to be surprised at in this, as ultimately it is the innocent depositors of the bank that suffer in its crash. The 1936 amendment itself was to enlarge the period of limitation for applications under section 235, by providing that a liquidator may within three years from the date of his first appointment take action against directors, promoters, etc., in respect of misapplication, retainer, misfeasance or breach of trust. The result of the amendment was to enable the liquid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o my mind, in the least unreasonable or illogical that it should have taken the view that it was anomalous and contrary to the public interest that directors at least, and probably other officers of the company, should be protected by a period of limitation running prior to the liquidation during a period when they themselves were in control of the company and had both the opportunity and incentive to conceal their own misdeeds ". At page 473 it is observed: "It is as clear as anything can be that the 1936 amendment of section 235 of the Indian Companies Act, 1913, was intended to affect the position of delinquent directors, and to affect it adversely ". Of course, the view as to retrospectivity taken in that case is to a certain extent, founded also on the discretion in the court under section 235 of the Indian Companies Act, to take up the view in any particular case that it would be unjust in that particular case to hold a director or other officers liable for some act of misfeasance which took place long ago. The principle of the above case has been accepted by Clark J. in Official Liquidator, S. S. R.S . Nidhi v. Krishnaswami Iyengar [1947] 17 Comp. Cas. 77 Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1950. The application for liquidation was filed on February 26, 1953. The order for liquidation was made on May 26, 1953, and an application under section 45D of the Act was made on June 28, 1954. It was observed by the Division Bench on appeal: "Of course, if the debt had become barred under the law of limitation before the initiation of the liquidation proceedings or the presentation of the application, the debt could not be revived merely because an application was presented within time under section 45D of the Act for adjudging the debtor concerned as a debtor of the bank in liquidation; but, where on the date of initiation of the liquidation proceedings, the debt has not been extinguished, then by virtue of section 45-O the debt will continue to subsist... In other words, the obvious intention of section 45-0 of the Act is that the period of limitation, as it were, remains suspended throughout the liquidation proceedings. " The point to be noticed is that in that case, the debt was alive, when the Ordinance 4 of 1953 came into force on October 24,1953. In Suburban Bank Ltd. v. Nistaran Chakrabart i [1954] 24 Comp. Cas. 273; AIR 1955 Cal. 172, 175 Bachawat J., the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held that the right to apply for execution of a decree which had become barred under the Limitation Act, 1877, could not be revived under the Limitation Act, 1908, in the absence of any provision in the latter Act so retrospective in its effect as to revive and make effective a judgment or decree which before that date had become unenforceable by lapse of time. Observing that the relevant enquiry, therefore, is whether there is anything in section 45-O of the Banking Companies Act which makes its provisions applicable to rights which had already become barred before the date on which it came into operation, the learned Chief Justice states: "On this point it is significant to note that sub-section (3) of section 45-O makes the provisions of the section applicable only to a banking company in respect of which a petition for winding up has been presented before the commencement of the Banking Companies (Amendment) Act of 1953;but does not make the provisions of the section applicable to debts due to : the banking company which had become barred by lapse of time before the date of such commencement. Then again sub-section (1) of section 45-O provides that the period commencing from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered to be wound up after the section had been enacted, but also to companies which had been ordered to be wound up earlier. There is nothing in sub-section (3) on the basis of which it can be argued that the provisions of sub-sections (1) and (2) of the section were to have the effect of reviving dead claims or of extending limitation for suits and applications which had already become time-barred. Advantage of those sub-sections could, therefore, be taken only if the cause of action either arose after the enactment of the section, or the claim in respect of it, if it had arisen earlier, was still within time." But in the Mysore High Court, Narayana Pai J. in In re Varthakavardhini Bank Ltd. [1964] 34 Comp. Cas. 225, 230-231 has held that the necessary intendment of the Banking Companies Act is that even if a claim is barred by the expiry of a period of limitation prescribed for its enforcement by any other law, that bar is removed by section 45-0(2). The learned judge holds that the net result of the provisions of section 45-0 is that claims which are governed by section 45-O(1) and in respect of which the provisions thereof can operate must he claims which are alive on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... king Companies Act may be said to have retrospective operation, especially in view of sub-section (3) thereof, the general principles of law governing the interpretation of statutory provisions purporting to have retrospective effect is that, in the absence of an express provision or clear intendment of the -statute, claims which are dead or barred should not be taken to have been revived, the learned judge observed : "If regard be had to the general overriding effect given to Part III-A of the Banking Companies Act by section 45-A and also to the language of -section 45-O(2), it appears to me that the contention of Mr. Bopanna is unavailable. If the two conditions regarding the claim are satisfied, viz , that the claim is made by a banking company in winding up and that the said claim is made against its director, it is governed exclusively by the provisions of sub-section (2) of section 45-O, and, consequently, there is no limitation of time for its enforcement notwithstanding anything to the contrary contained in any other law. It may be noted that the said sub-section prescribes a period of limitation only in respect of claims falling under the third category and expressly d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in force, in computing the period of limitation prescribed for a suit or application by a banking company (in respect of which a petition for the winding up has been presented, before the commencement of the banking companies (Amendment) Act, 1953) the period commencing from the date of the presentation of the petition for the winding up of the banking company shall be excluded." When read as above stated, we find nothing in Part III-A of the Act to limit the plain language of sub-section (1) so read with sub-section (3). It must be noticed that apart from section 45-A making the provisions of Part III-A override all laws for the time being in force inconsistent with the provisions of Part III-A, section 45-O(1) and section 45-O(2), each start with a non-obstante clause, emphasising the overriding effect of the sub-clauses. The provisions of the Indian Limitation Act to the contrary are specifically excluded. We fail to see what other retrospectivity Parliament intended by providing sub-clause (3). In Maxwell on the Interpretation of Statutes, eleventh edition, it is stated at page 277: "The defence of lapse of time against a just demand is not to be extended to cases whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... course, it is obviously competent for the legislature, if it pleases, in its wisdom to make the provisions of an Act of Parliament retrospective: Smith v. Callander [1901] AC 297, 305. We may usefully read here what Bowen L.J. said in Reid v. Reid [1886] 31 Ch. D. 402, 408. 'Now the particular rule of construction which has been referred to, but which is valuable only when the words of an Act of Parliament are not plain, is embodied in the well-known trite maxim ominis nov a constitutio f uturis formam imponere debet non praeteritis, that is, that except in special cases the new law ought to be construed so as to interfere as tittle as possible with vested rights.' We wish to emphasise that it is not as if all efforts should be made so as-not to give a statute a retrospective operation whatever its language is. The rule does not require of the courts an 'obdurate persistence' in refusing to give a statute retrospective operation." As, in our view, not merely intendment, but by the plain and express language, sub-sections (1) and (2) have been made retrospective and applicable to banking companies already being wound up, we are unable to limit or curtail the op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the present case must be a breach of trust or misfeasance in the nature of a breach of trust as pointed out by Lord Mac-naghten in Cavendish Bentinck v. Fenn [1887] 12 App. Cas. 652 , and that article 115 is not strictly applicable to a misfeasance of that character, nor is article 116, as 'breach of contract' is not the sole liability sued on, nor is it the usual nomenclature for a breach of trust whether specific or quasi. But whichever answer is adopted, this leaves us only with article 120." In Rustomji's Law of Limitation, sixth edition, at page 127, it is stated thus: "In India, directors are not considered "express trustees" as the company's property is not vested in them within the meaning of section 10( a ). The residuary article 120 would be applicable in the case of a breach of trust by a director." In Subbiah Thevar v. Samiappa Mudaliar ILR 1938 Mad. 586; AIR 1938 Mad. 353, 356 (FB), it is stated at page 595 : "Article 36 applies to torts not specially provided for, and if it stood alone there would be little to indicate that it was not intended to apply to breaches of trust of the nature of those we have now in mind. But there i s article 98, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed for any suit or application by a banking company, the period of one year immediately preceding the date of the order for the winding up of the banking company shall be excluded." There is no restriction or qualification in applying section 45F to the banking company then in liquidation. In Kalipada Banerjee v. Sree Bank Ltd. [1960] 30 Comp. Cas. 234 it has been held that banking Companies, which were ordered to be wound up before the Banking Companies Act, 1949, came into force, were also entitled to the benefit of the special period of limitation provided by section 45F. Of course, as the effect of section 45F is only to provide for the exclusion of a period of one year in the computation of the limitation, the claim must be subsisting; when the provision was first introduced into the Banking Companies Act, namely, on September 19, 1949, when Ordinance 23 of 1949 came into force. Section 45F will, therefore, apply only to claims within six years prior to September 19, 1949. The order for winding up in this case was made on November 5, 1947. The liquidators will be entitled to exclude, for computing the period of limitation, a period of one year immediately prior to Novemb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the decision of the Supreme Court in Bombay Gas Co. v. Gopal Bhiva AIR 1964 SC 752 . The following passage at 757 of the report was relied on: "In dealing with this question, it is necessary to bear in mind that though the legislature knew how the problem of recovery of wages had been tackled by the Payment of Wages Act and how limitation had been prescribed in that behalf, it has omitted to make any provision for limitation in enacting section 33C(2). The failure of the legislature to make any provision for limitation cannot, in our opinion, be deemed to be an accidental omission. In the circumstances, it would be legitimate to infer that legislature deliberately did not provide for any limitation under section 33C(2). It may have been thought that the employees who are entitled to take the benefit of section 33C(2) may not always be conscious of their rights and it would not be right to put the restriction of limitation in respect of clam which they may have to make under the said provision ..It seems to us that where the legislature has made no provision for limitation, it would not be open to the courts to introduce any such limitation on grounds of fairness or j ..... X X X X Extracts X X X X X X X X Extracts X X X X
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