Dharmarth Trust J &
K Jammu & Ors. Vs. Dinesh Chander Nanda  INSC 714 (8 September 2010)
IN THE SUPREME COURT
OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. OF 2010 (Arising out of
S.L.P. (C) No. 11363 of 2008) Dharmarth Trust J&K Jammu & Ors. ....
Appellant(s) Versus Dinesh Chander Nanda .... Respondent(s)
P. Sathasivam, J.
appeal is directed against the judgment and order dated 18.10.2007 passed by
the High Court of Jammu & Kashmir at Jammu in Civil Revision No. 177 of
2005 whereby the High Court dismissed the revision filed by the Dharmarth Trust
(hereinafter referred to as "the Trust")-appellants herein.
(a) The Respondent, a
qualified, registered and licensed Architect, is engaged in his professional
business in the name of M/s Nanda Designers Consortium having its office at 60
Purani Mandi, Jammu. On 19.10.1992, he was engaged by the Trust for the purpose
of providing professional consultancy services as an architect for various
projects at different sites in Jammu. As per the terms of the said contract, a
fee of 2.5% of the total project cost was fixed for providing such services.
(b) On 14.12.1993,
the appellants-Trust telephonically communicated the respondent not to work further
for their projects and terminated his services as an Architect.
communication was also served on 16.01.1994 regarding the termination of his
(c) On 16.10.1996,
the Respondent served a legal notice to the Trust claiming compensation
amounting to Rs. 38,77,263.75 towards professional charges including interest
thereon for various projects. After not getting any reply from the Trust, after
a gap of four years, on 29.01.1998, a suit was filed by the Respondent in the
Court of the Ist Additional District Judge, Jammu, claiming an amount of Rs,
43,30,797/-. During the pendency of the suit, on 08.02.1999, the Respondent
filed an application under Order VI Rule 17 of the Code of Civil Procedure for
amendment in the Plaint. On 22.09.1999, the Trust filed their reply objecting
to the maintainability of the application. By order dated 08.10.1999, the trial
Court allowed the application. Challenging the said order, the Trust filed
Civil Revision No. 162 of 1999 before the High Court praying that the trial
Court had committed an error in law by allowing the amendment in the plaint
without addressing the legal issue regarding its maintainability. The High
Court, vide order dated 19.07.2001, disposed of the civil revision petition
filed by the Trust and remanded the matter back to the trial Court to address
the legal issue regarding maintainability/limitation. Thereafter, on
27.09.2005, Ist Additional District Judge framed the issue and passed an order
holding that the case is governed by Article 119 and not by Article 56 of the
Jammu & Kashmir Limitation Act, 1995 (hereinafter referred to as "the
Act") and consequently, allowed the amendment to the Plaint.
d) Challenging the
said order, the Trust filed Civil Revision No. 177 of 2005 before the High
Court. Vide order dated 18.10.2007, the High Court dismissed the revision and
upheld the order dated 27.09.2005, passed by the Ist Additional District Judge.
Aggrieved by the said order, the Trust has filed this appeal by way of special
leave before this Court.
Mr. Ashok Mathur, learned counsel for the appellants and Mr. V. Giri, learned
senior counsel for the respondent.
short question that arises for consideration in this appeal is whether the suit
filed by the respondent-Architect is covered under Article 56 of the Act or
whether the said suit is covered under Article 119 of the Act.
Trial Court and the High Court have held that the suit is covered by Article
119 of the Act. According to the appellants, the suit filed by the
respondent-Architect is governed by Article 56 of the said Act and the same was
barred by limitation on the date of its institution. On the other hand, the
submission of the respondent is that the same was covered by the residuary
Article 119 which provides for a period of 6 years on the ground that the
nature of services provided was professional services and the remuneration for
the same being termed as `fee' and the same does not fall within the expression
`price' for `work done'.
56 and Article 119 of the Schedule to the Jammu and Kashmir Limitation Act,
1995 provides as follows:- Article For the price of work done by the Three When
the 56 Plaintiff for the Defendant at his Years work is done.
request, where no
time has been fixed for payment.
Article Suit for
which no period of limitation Six When the 119 provided elsewhere in the
Scheduel. Years right to sue accrues.
term `price', as appearing in Article 56, is to be understood in common
parlance/ordinary or normal sense. It takes it colour from the meaning attached
to the term `price' in the Articles immediately preceding `Articles 52 to 55'.
`Price' does not cover the services provided by the professionals such as
Architect, Lawyer, Doctor etc., as professionals charge a `fee'. Also, the term
`work done' in Article 56 will not be applicable to professionals such as
Architect, Lawyer, Doctor etc. as these professionals render services to their
clients. The remuneration of a professional is in the form of a `fee' and therefore,
it cannot be said that the professional earns a `price'. In common usage, the
term `price' refers to goods sold.
For illustration, the
term `price' is defined in Section 2 (10) of the Sale of Goods Act, 1930 as
"price" means the money consideration for a sale of goods.
word `price' according to Webster’s Encyclopedic Unabridged Dictionary means:
"Price- 1. the
sum or amount of money or its equivalent for which anything is bought, sold, or
offered for sale 2. a sum offered for the capture of a person alive of dead:
The authorities put a price on his head. 3. the sum of money, or other
consideration, for which a person's support, consent, etc., may be obtained,
esp. in cases involving sacrifice of 6 integrity: They claimed that every man
has his price. 4. that which must be given, done, or undergone in order to
obtain a thing: He gained the victory, but at a heavy price. 5. Odds (def.2).
6. Archaic, value or worth: The price of an honest man is beyond measure. 7.
Archaic, great value or worth (usually prec by of): Among the inventory were
many articles of price. 8. at any price, at any cost, no matter how great:
There were no bananas
to be had at any price. He would have his own way at any price. 9. beyond or
without price, of incalculable value; priceless: The crown jewels are beyond
price.-v.t. 10. to fix the price of. 11. to ask or determine the price of: We
spent the day pricing furniture at various stores.
Twentieth Century Dictionary defines "price" to mean:
usually in money, for which a thing is sold or offered; that which one for goes
or suffers for the sake of or in gaining something: money offered for capture
or killing of anybody; that for which one can be bribed; betting odds;
According to P.
Ramanatha Iyer, Law Lexicon (2nd Edn. 1997), "the term `price' is the
value which a seller places upon his goods for sale. It is not a fixed or
unchangeable thing. It may be one thing today and another tomorrow and one
valuation to one customer and a different one to another on the same day or
hour. Whether a seller asks any one to give is the price until he changes it
for another. The price asked is changed to another price, the former price is
no longer an existing fact. "
The Law Lexicon also
defines the term `price' as "the sum or amount of money or its equivalent,
which a seller asks or obtains for goods in market--the exchangeable value of a
commodity--and hence, as used in a contract providing for the sale of articles
at a fixed price, and that if 7 the price falls below such fixed price, a
rebate will be given..."
`price' is sometimes also used for "work done" in the context of work
done by masons such as land filling etc.
contracts. In view of the above, the term `price' is in common usage used in
correlation to either goods bought or sold or work done."
There is further
indication of this word in the Act itself. The setting of Article 56 i.e.
immediately after Articles 52 to 55 is important. Articles 52 to 55 uses the
expression `price'. These are reproduced hereinbelow:- Article For the price of
goods delivered where Three The date of the 52 no fixed period of credit is
agreed years delivery of upon. goods.
Article For the price
of goods sold and Three When the 53 delivered to be paid for after the expiry years
period of credit of fixed period of credit. expires.
Article For the price
of goods sold and Three When the 54 delivered to be paid for by a bill of years
period of the exchange, no such bill being given. proposed bill elapses.
Article For the price
of trees or growing crops Three The date of the 55 sold by the plaintiff to the
defendant years sale where no fixed period of credit is agreed upon.
The term `price' has
been used in Articles 52 to 55 in correlation to goods delivered, goods sold
and delivered and trees or growing crops sold. In this way, `price' would take
a similar meaning when used in Article 56.
intention of the Legislature can also be ascertained by referring to Article
114 of the Act where the Legislature has specifically provided for the period
of Limitation for suits filed by an attorney/vakil. Article 114 is as follows:-
Article By an attorney or vakil for Six The date of the termination 114 his
costs of a suit or a Years of the suit or business, or particular business,
there (where the attorney or vakil being no express properly discontinues the
agreement as to the time suit or business) the date of when such costs are to
be such discontinuance. paid.
rightly pointed out by Mr. Giri, learned senior counsel for the respondent that
the specific treatment of attorneys/vakils who provide professional services is
a reflection of the intention of the Legislature to treat the services provided
by professionals differently from work done by others. The word `price' was
never intended to be used synonymously with the word `fee' and, therefore, the
fee charged by an Architect for services rendered by him would not be covered
under Article 56 of the Act. In the case on hand, the Trial Court as well as
the High Court have made a clear distinction between the terms `work done' and
The `work done' would
refer work done by masons such as land filling or engineering projects etc.
is useful to refer to the tax treatment of Architects under the Service Tax Law.
Chapter V of the Finance Act, 1994, which contains the law relating to Service
tax in India defines an "architect" in Section 65(6) as:- "any
person whose name is, for the time being, entered in the register of architects
maintained under section 23 of the Architect Act, 1972 and also includes any
person engaged in any manner, whether directly or indirectly, in rendering
services in the field of architecture."
It is brought to our
notice that the services provided by an architect are taxable under the Service
Tax law. Under the Service Tax Laws, the architects are considered as persons
providing a service and are liable to pay service tax. The term `work done' has
not been defined anywhere. We have already pointed out the dictionary meaning
to the definition of `work`.
The Law Lexicon
defines `work' as:- "the word "work" has a very wide meaning. It
is really used in two senses of bestowing labour and that upon which labour has
been bestowed. When used in plural the word certainly means some outstanding or
important result of the labour that has been bestowed and large industrial and
scientific establishment are called works"
We have already
referred to Articles 52 to 55 which are placed above Article 56. It is clear
that the term `work done' as appearing in Article 56 does not apply to the
respondent, who is an architect providing services for a fee.
is also pointed out that Article 56 of the Act is a verbatim of Article 18 of
the Indian Limitation Act, 1963.
Article 18, in turn
is the same as Article 56 of the old Indian Limitation Act, 1908.
High Court of Allahabad in Kaviraj Baroda Kant Sen vs. Court of Wards in Charge
of Baraon Estate, AIR 1931 All. 752, as early as in 1931, while interpreting
Article 56 of the Indian Limitation Act, 1908 has stated as follows:
difficult to apply Article 56 which relates to a suit for the price of work
done by the Plaintiff for the Defendant at his request. No special article
appears to be applicable to a claim by a medical practitioner for recovery of
his fees for attendance on a patient. The residuary Article 115 which applies
to all breaches of contract, would therefore apply, for there was undoubtedly a
contract, at east, an implied one, to pay the fee, and the non-payment of that
fee amounted to a breach for which the plaintiff would be entitled to
compensation. In Harish Chander Surmah vs Brojonath Chackerbutty  13 W.R.
96 a suit for recovery of compensation for the fees of a medical practitioner
was held to lie under the corresponding article of the Limitation Act then in
High Court of Gauhati in Kakodonga Tea Estate vs. J.N. Saikia, AIR 1973 Gau.
27, has also held that "a suit to recover unpaid professional fees by a
Chartered Accountant falls under Article 113 and not under Article 18 or
Article 55...". The High Court of Gauhati further specifically held as
"8. It is easy
to assume that very deep thought must have been devoted by the Legislature in
giving shape to the various Articles of the old as well as the new Limitation
It is equally
legitimate to assume that the words of each Article must have been used in
their commonly accepted connotation unless contrary intention is expressed in
the body of the Act just as is apparent from Section 2 wherein certain
expressions have been defined to mean something less or more than what their
commonly known attributes are. The expression "price" used in Article
18 must, therefore, be taken to convey the commonly accepted sense implicit in
it. According to the Chambers Twentieth Century dictionary the word
"price" means: the amount, usually in money, for which a thing is
sold or offered; that which one forgoes or suffers for the sake of or in
money offered for
capture or killing of anybody: that for which one can be bribed; betting odds;
values. In common parlance what a client pays to a professional person like an
Advocate and a CA is described as "fee" and not "price".
Likewise, what a
patient pays to a medical-man for the services rendered to him by the latter is
called "fee" and not "price". Therefore, it would be unduly
straining the expression "price" used in Article 18 if it were held
synonymous in connotation with the fee paid to an Advocate, a Medical-man or a
CA. For this reason alone, I believe, Article 18 does not provide for a suit
for the professional fee of the nature just stated....."
agree with the ratio laid down by the Allahabad and Gauhati High Court relating
to Article 56 of the Indian Limitation Act, 1908 that the term "price of
work done" cannot be made applicable to professions where the
professionals merely provides services for a "fee". We accept the
claim of the respondent that the profession of an Architect is one such
service, hence Article 56 is not applicable to the present case.
Both the Trial Court
as well as the High Court has arrived correct conclusion.
the light of the above discussion, we do not find any error in the conclusion
arrived at by the Trial Court and affirmed by the High Court. Consequently, the
appeal fails and the same is dismissed with no orders as to costs. We further
make it clear that our conclusion is confined to the interpretation relating to
limitation and we have not expressed anything on the merits of the claim made
by the parties.
( P. SATHASIVAM )
(ANIL R. DAVE)