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TMI Blog2015 (12) TMI 1903X X X X Extracts X X X X X X X X Extracts X X X X ..... e impugned judgement is set aside - appeal allowed. - HON'BLE MR. JUSTICE RAJIV SHAKDHER For the Petitioner: Ms P. Rungta and Mr. Prashant Singh, Advocates. For the Respondent : None RAJIV SHAKDHER, J 1 This is an appeal preferred against the judgment and decree dated 16.09.2013, passed by the learned Additional District Judge (In short the ADJ). By virtue of the impugned judgement, the appellant‟s suit for recovery has been dismissed on the sole ground that it is barred by limitation. 1.1 The learned ADJ has come to this conclusion based on a perusal of the statement of accounts (Ex. PW1/9) filed by the appellant, which is dated 31.10.2009. As per the said statement of account, the last transaction with the respondent took place on 11.08.2008. The learned ADJ thus, concluded, that since, the suit was filed on 20.07.2012, it was hopelessly barred by limitation. 1.2 Since the respondent, during the course of the proceedings, chose not to appear before the trial court, he was proceeded ex parte, after the appellant‟s witness had been partially cross-examined. 1.3 A perusal of the impugned judgement shows that the trial court has taken recourse to Section 3 of the Li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3.6 It is, therefore, in this background that the appellant instituted the instant suit against the respondent, on 20.07.2012. It appears, that the respondent, despite being served in the suit, initially did not file his written statement, which resulted in his defence being struck out vide order dated 11.10.2012. On an application being moved, the said order was recalled and the respondent was permitted to file a written statement, subject to his surrendering the vehicle and paying a cost of Rs. 5,000/-. This direction was issued by the trial court vide order dated 20.10.2012. 3.7 The record shows that the trial court framed the following issues in the matter vide order dated 21.11.2012: ..1. Whether the suit is barred by limitation? OPD 2. Whether plaintiff is entitled for a decree of the suit amount? OPP 3. Whether plaintiff is entitled for pendente lite and future interest on decree amount? If so, at what rate? OPP 4. Relief... 3.8 The appellant cited one witness, namely, Mr. Vipin Goswami (PW1). Mr Vipin Goswami (PW1), was partially cross-examined by the respondent. Since the respondent chose, albeit midway, not to participate in the trial of the suit, vide order dated 22.08.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cle 55; firstly, the action instituted should be a suit for compensation for breach of contract, which may be express of implied. Secondly, it should not be an action qua which limitation is provided in other Articles of the same Part of the Schedule to the 1963 Act. Therefore, one has to examine, as to whether the term compensation would include only an action for damages, which involves recovery of unliquidated damages or, would it also cover a claim for recovering debt, that is, a sum certain. Apart from this, one would also have to examine whether the action can be covered under any other Article in Part II falling in First Division of the Schedule. 8. Taking the second aspect first, the only Articles which, perhaps, would have come in the way, were Article 19 and 21 of Part II to the Schedule to the 1963 Act. The said Articles are extracted hereinbelow for the sake of convenience: Description of suit Period of Limitation Time from which period begins to run 19. For money payable for money lent. Three years When the loan is made. 20. xxxx xxxx Xxxx 21. For money lent under an agreement that it shall be payable on demand Three years When the loan is made. 9. A closer scrutiny of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of limitation, the Kerala High Court examined the scope of Article 55 in the context of Article 19 and 21. The court concluded that Article 19 and 21 had no application to the case at hand, and that Article 55 would operate in the facts of that case. Importantly, qua the aspect as to whether the term compensation would include a suit for debt based upon a breach of contract, the court made the following observations in paragraph 15. For the sake of convenience the same are extracted hereinbelow: 15. The wording of Article 55 of the present Act and that of Article 115 of the old Act are identical. The basis of the above argument of the learned counsel for the respondent is that the word 'compensation' may not comprehend the concept of debt and as such a suit for a debt based upon a breach of contract as in this case may not come within the purview of Article 55 of the Act (Article 115 of the old Act). Dealing with the term compensation used in Article 115, Mookerjee, J. has made the following observations in the decision reported in Md. Mozaharal Ahmad v. Md. Azimaddin, AIR 1923 Cal 507 at page 511: ......the term used in Article 115 and Article 116 is not damages but compe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... due under a contract alleging breach of contract. In this view, it is clear that Article 55 may properly be considered as the Article which would apply to the suit in question as the loan in this case was made on the basis of an agreement specifying a fixed time for its repayment. 11. To my mind, Article 55 could have possibly been made applicable, to this case as well, as the loan agreement had a tenure extending from 10.08.2007 till 10.06.2012, but for one aspect of the matter which I have adverted to in the following paragraph. In so far as Article 55 is concerned, the fact that that the respondent failed to adhere to the schedule of repayment, would not deprive the right of the appellant to treat each breach as a fresh cause of action. The last breach, quite clearly, in the instant case, would have occurred only in May-June, 2012, assuming the last instalment was to be adjusted by virtue of the respondent having paid an initial amount of Rs. 7544/- as an advance. The suit, admittedly, was instituted on 20.07.2012. 12. Having said so, there is, as stated above, another aspect of the matter, as regards this case, which is that, under the loan agreement, the appellant, in terms of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t has not alluded to any specific Article of the 1963 Act. Recourse has been taken by the trial court to Section 3 of the 1963 Act. Section 3, inter alia, only empowers a court to dismiss a suit which is barred by limitation even if limitation is not set up as a defence. The section by itself could not have helped the trial court in coming to the conclusion as to what should be the period of limitation in a case such as this. Furthermore, the reference to Article 37 in the written statement is also of no relevance as the appellant did not sue either on a promissory note or a bond. 14. Having regard to the above, the appeal is allowed and, consequently, the impugned judgement is set aside. The learned trial Judge will thus proceed to decide the remaining issues i.e. issue no. 2, 3 4 in line with the evidence and the relevant provisions of law. The trial court will issue fresh notice to the respondent before it recommences proceedings in the matter. 15. The appeal is, accordingly, disposed of. There shall be, however, no orders as to cost. NOTE:- 1 48. On the happening of any of the Events of Default, ICICI Bank may, by a notice in writing to the borrower/s and without prejudice to t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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